It was recently reported that the budget impasse/revenue shortfall will cause the comptroller to temporarily delay the state’s statutorily required pension payments to all of the five state-funded pension systems beginning in November. The pension systems impacted are the Teachers’ Retirement System (TRS), the State Universities Retirement System (SURS), the State Employees’ Retirement System (SERS), the Judges Retirement System (JRS), and the General Assembly Retirement System (GARS). The IEA, TRS, SURS, and the comptroller are 100 percent confident that retirees in these affected retirement systems will continue to receive their retirement annuity. The Illinois Municipal Retirement Fund (IMRF) is not impacted.
With the state entering the fourth month of a budget impasse, the IEA continues to closely monitor how the state will manage and prioritize budgetary items since there is clearly an imbalance between state expenditures, such as education funding, and the actual revenues coming into the state’s coffers to meet those budgetary commitments.
The IEA was aware that this was an option being explored by the comptroller for some time. The delay of the state’s pension contribution to the state retirement systems is a budgetary tool previously utilized by comptrollers to manage the state’s cash flow needs. We will continue to work with the comptroller’s office and other state policy makers to ensure that the required pension payments that are being delayed will be paid in full to the respective pension systems. Additionally, the IEA is committed to finding the revenue needed to resolve the inadequacy of the state’s current revenue system.
Below is the news story from Bloomberg:
(Bloomberg) — Illinois will delay pension payments as a prolonged budget impasse causes a cash shortage, Comptroller Leslie Geissler Munger said.
The spending standoff between Republican Governor Bruce Rauner and Democratic legislative leaders has extended into its fourth month with no signs of ending. Munger said her office will postpone a $560 million retirement-fund payment next month, and may make the December contribution late.
“This decision is choosing the least of a number of bad options,” Munger told reporters in Chicago on Wednesday. “For all intents and purposes, we are out of money now.”