The Illinois General Assembly passed legislation extending a program that allows retiring public servants to be paid out a large portion of their pension, forfeiting a portion back to the state. The buyout program’s extension comes as the state has made a small dent in the largely unfunded $144 billion pension liability.
To date, the state has made roughly $2 billion in buyout payments, while reportedly reducing the liability by about $2.6 billion – showing the voluntary program has saved taxpayers some money in the long run.
As a result of the bill’s passage in Springfield, the state should soon be able to take out an additional $1 billion in bonds to fund the program for two more years.
LyLena Estabine, a senior policy analyst for the Illinois Policy Institute, told The Center Square the buyout program pays out between 60-70% of what a state pensioner would receive if they remained on the plan, while giving retirees more say over their money.
Gov. J.B. Pritzker touted the extension as part of his plan to further reduce the state’s historic liability when he proposed his requested version of the state budget earlier this year.
Another way he’s proposed to lower the liability is by using savings the state sees as a result of paying off earlier debts.
The bill was officially sent to Pritzker’s desk this week and is expected to be signed soon.
Story from Illinois Radio Network
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