Subject: From IRTA-Unit 90
I would suggest that the following be shared with our members:
We would recommend that you watch and/or listen to Governor JB Pritzker deliver his first State of State next week Wednesday, February 20, traditionally at noon. With approximately twenty-five percent of state’s budget devoted to pensions and the new administration already noting that the upcoming budget is expected to be $3.2 billion out of balance. Pritzker is going to have to balance that status with big asks from state employees wanting raises, billions in increased spending requested by K-12 schools and more than $300 million additional money public universities are requesting. We fully expect that some sort of plan will be offered to deal with the “pension problem.” But will the plan call for a solution that results in more money being raised to pay for the pensions or a sleight of hand maneuver that attempts to cut costs by reducing benefits. Given the governor’s prior comments, I think he will call for more money for pensions.
I do believe Pritzker is likely to reset the clock on the Fifty Year Plan that currently call for funding to bring pension funding up to ninety percent by 2045 to instead make it 2050 or beyond, and to once again have the state borrow money to help pay the higher amounts needed by the payment plan. The state will pay approximately $8.54 billion to the five state pensions funds this year and $4.81 billion of that goes to TRS. And keep in mind that three-fourths of that number is what is owed because of past under funding of our pensions. The Fifty Year plan would require the state to put $9.2 billions into pensions.
Bob Lyons