What is the debt of Illinois?

According to Moody’s Investors Service, it reached a record high of $317 billion in June 2020. Such massive debt is having great effects on the rest of the state.

Is Illinois broke?

Today, Illinois has nearly $140 billion in unfunded pension debt and its credit rating is just one notch above junk status. That debt now eats $31 of every $100 taxpayers send to the state. It has cut by one-third into essential services.

How much do Illinois pensions owe?

All told, state and local governments in Illinois owe more than $203 billion for pensions and retiree health insurance. This is more than $41,000 in retirement debt for every Illinois household.

What caused Illinois pension crisis?

Why Illinois has a pension crisis. Illinois’ massive, growing, government-worker pension debt is a direct result of three major factors: overgenerous pension benefits, political manipulation and inherent flaws of pension plans.

Why is Illinois economy so bad?

Long-run economic growth can be decomposed into three factors: population growth, employment growth and labor productivity growth. Another major factor contributing to Illinois’ lackluster economic performance is the state’s weak labor market.

Does Illinois still offer pensions?

Illinois is home to 667 government pension funds Illinois has 667 government-worker pension funds that are supposed to provide retirement security for more than 1 million government workers and retirees. Pension funds in each of these groups – the state, Chicago and other municipalities – are in crisis.

How much is Chicago pension debt?

In all, Chicago owes $32.9 billion to its four employee pension funds representing police officers, firefighters, municipal employees and laborers, according to the 2020 Certified Annual Financial Report. That is an increase of nearly 3.5\% from 2019, according to the report.

What caused the Illinois pension crisis?

Why is Chicago in so much debt?

The COVID-19 pandemic damaged many of the largest American cities financially. Chicago’s pension crisis has grown so severe it has more pension debt than 44 U.S. states. It is getting worse, as required pension contributions will jump by $1 billion just during Mayor Lori Lightfoot’s first term.

What went wrong with Illinois’ balanced budget?

Illinois politicians constantly used financial gimmicks – such as shifting funds and pushing off unpaid bills into the next year – to get around the balanced budget requirement. And they never left enough room in the current year to pay down the previous year’s unpaid bills.

What’s going on with Illinois’ finances?

While the budget impasse is throwing a spotlight on Illinois’s dire financial situation today, the fiscal problems go back at least to the 1980s and involve politicians from both parties. The most glaring evidence is the enormous pension crisis.

What happened to Illinois’ unpaid bills after tax hike expired?

The state’s bills weren’t paid off. Instead, they were reduced by less than $2 billion. The state still had $6.6 billion in unpaid bills to go when the tax hike expired. Illinois also suffered one of the weakest economic recoveries in the nation.

How did Illinois get to this financially tragic place?

“Illinois got to this financially treacherous place by ignoring the long-term consequences of short-term decision-making,” said Laurence Msall, the president of Civic Federation, a budget watchdog organization.