To the Editor:
According to many reports, Illinois’ recently passed pension reform bill will do far less than originally projected to help the State’s pension crisis. Studies and newly published findings show that the savings estimates touted by supporters of this legislation are off the mark.
A recent article in Crain’s Chicago Business refers to the Civic Federation of Chicago’s website, which states “while sponsors of the bill estimated state taxpayers would have to contribute $1.2 billion less than previously required when the law is fully implemented in 2016, the latest figures from Gov. Pat Quinn’s office come in more than half a billion dollars short of that.”
In reality, the latest statements from the pension fund actuaries indicate that the savings to taxpayers is closer to $756 million for fiscal year 2016, almost $500 million short of the bill’s initial $1.2 billion savings estimate.
So what does this mean to every resident in Illinois? In short, higher interest rates when the state needs to borrow money, we will continue to have the worst credit rating in the nation and a continual shortfall in funding of vital services.
Three years ago Springfield leadership passed a 67 percent income tax increase, selling the idea that it was a temporary hike to help the state pay its bills and get its pension system back to solvency. This increase generated $7.5 billion a year, and yet our state continues to have the worst pension funding levels in its history. With the sunset of this tax fast approaching, many are concerned that this increase will become permanent.
Pension modifications passed last session will not provide enough budget savings to solve the deficit, which will balloon after the temporary tax increase expires because we have not fixed our poor spending habits.
Quinn failed to outline in his State of the State address what his plans are for the temporary tax increase. Much of his speech focused on increasing spending and creating new programs and services. Moreover, he did not illustrate how his administration plans to pay for additional and current growing expenses.
Over the past 10 years Illinois has been plagued with poor fiscal management. Illinois should not be toying with new taxing methods and more spending on programs. Rather we should focus on controlling spending and making the state friendly to business by having a stable tax structure that is competitive with other states.
State Rep. Joe Sosnowski