As Illinois lawmakers struggle to find a way to manage a nearly $8 billion pension payment, $9 billion in unpaid bills and a $130 billion pension debt, one policy group this week said it had some simple solutions. The biggest change in The Illinois Policy Institute’s proposed budget would immediately switch Illinois’ five pension systems from defined benefit plans to a 401(k) style retirement system, where the employee manages his own money.
“Everything (public employees) have earned up until today they would keep,” said state Rep. Tom Morrison, R-Palatine, who wrote the pension proposal at the heart of the institute’s budget. “This makes so much sense to people back home. It is a simple plan; it doesn’t need to be a 300-page piece of legislation,” Morrison said Thursday.
Illinois has been trying to contain the skyrocketing costs of its pension plans, but lawmakers can’t agree on a single plan. There is also the question of which plan would survive a court challenge. Illinois has a constitutional guarantee that pension benefits will not be reduced.
Illinois Policy Institute CEO John Tillman said anything that passes the Legislature will end up in court, anyway, so he’s not worried about the Institute’s plan.