Days after a massive Chicago teachers strike ended, the Teachers' Retirement System lowered investment estimates from 8.5 percent to 8 percent, which means Illinois will have to come up with an additional $670 million to fund its teachers pension program.
The newly adjusted figures indicate the state’s teachers pension plan deficit, already mired in red ink, is far worse off than previously reported, according to a Chicago Tribune report.
Many inaccurate assumptions were updated including how long teachers are expected to live after retiring.
Gov. Pat Quinn's administration said the $670 million budget hole buttresses the need to approve a pension overhaul “that would reduce costs at one of the worst-funded state retirement systems in the nation.”
Illinois is paying $2.7 billion its teachers pension fund in its current budget; however the state would have owed about $2.89 billion in the current fiscal budget taking effect on July 1.
In comparison, the new changes approved Friday pushes the teachers pension price tag up to $3.37 billion, leaving the state owing about than $670 million this year.
Illinois Democrats have postponed pension reform until January, after the elections, when lame duck legislators are more likely to vote for a bill.
For their part, Republican leaders Rep. Tom Cross of Oswego and Sen. Christine Radogno of Lemont say the changes “will deepen the teacher pension fund's total debt by billions of dollars over the years.” The Republicans expressed disappointment that Democrats have put off badly needed pension reform until January.