Illinois state Rep. Dan Ugaste (R-Geneva) on the House floor | repugaste.com
Illinois state Rep. Dan Ugaste (R-Geneva) reasons that state lawmakers can be expected to do only so much to help the City of Chicago out from under its growing pension liability.
“It would be great if the state of Illinois had the funds to help out the city in a time of need,” Ugaste told the McHenry Times. “The sad statement is neither the city nor the state are very well situated financially. If there is something we can do within the laws that is fair and equitable to the workers where we can help Chicago out, we certainly need to do that but as far as the financial bailout, the state doesn’t have the resources.”
With Chicago Mayor Lori Lightfoot having recently floated the idea of a state bailout of Chicago’s pension funds, an Illinois Policy Institute (IPI) analysis finds that such debt would jump some $63 billion at around a bottom-line price-tag of at least $200 billion, which IPI deduces would almost guarantee more tax hikes.
Chicago Mayor Lori Lightfoot
With the state already spending upwards of one-fourth of its revenues on pension costs, Ugaste argues that would simply be untenable.
“I think at this point, anyone who becomes a government employee within the state needs to be put in a 401(k) plan just like in private industry,” Ugaste said. “Second, we need to amend the state constitution, not to take away anything from anyone that’s earned it, but to make it so these are workable and feasible situations going forward.”
According to IPI, Chicago’s pension debt burden is already worse than 44 states, easily making it one of the primary reasons why the state’s credit rates are the worst in the country.