Illinois Joins Nation-Wide Push To Curb Pensions
Illinois is just the latest state to vote on legislation to overhaul public pension plans.
Heather Kerrigan, a contributor with Governing Magazine, said this year alone, state and local governments around the country have proposed more than 1,000 pieces of legislation to shore up pensions. She noted that almost all of them face the same challenge.
“The main experiment right now that’s going on is how much shared risk states can get their employees and their unions – if they’re negotiating with the unions – how much they can get them to agree to because at this point although it may have been the state raidingthe pension funds, it can’t bear the brunt of re-funding all by themselves,” Kerrigan said.
Like Illinois’ bill, Kerrigan said the pension overhauls in many states follow a similar pattern… raising the retirement age, reducing cost of living increases and adding a 401(k)-style plan instead of only a defined benefit.
Kerrigan said it will take years to determine whether any particular state’s approach is successful.