Illinois Governor Pat Quinn is out with his plan to reform the state's pension system.
The Governor's proposal, released Friday, would eliminate the current $83 billion dollar unfunded liability by 2042. The proposal would reduce the state's pension costs by $65 to $85 Billion based on current actuarial assumptions. The plan would make several changes to the existing pension system. The start with it would increase employee contributions by 3%; reduce COLA adjustments and tie them to the Consumer Price Index; Delay COLA increases until five years post retirement; Increase the state retirement age to 67; and limit public sector pensions to public sector employees. The plan also calls for shifting more pension responsibility to each employer including school districts, community colleges and the public universities.
Governor Quinn says in consideration of his proposed changes the state would continue to count pay increases in the pension calculation and state employees would receive a health care subsidy in retirement. Quinn says currently 90% of retired state employees pay nothing for their health care costs. Quinn says states comparable to Illinois in size and demographics provide little to no health care assistance for retirees.