State Rep. Jeff Keicher, R-Sycamore, was on hand for when Gov. JB Pritzker signed a bill to consolidate local pensions.
The law will consolidate the investment function of 649 suburban and downstate police and fire pension systems into two systems. By consolidating the smaller systems into two larger systems, investment returns are expected to grow by billions over the next 10 years, administrative costs will drop significantly, and taxpayers could end up paying less to support local pensions for first responders, according to a news release.
“This was a true bipartisan effort that was decades in the making,” Keicher said in the release. “After years of inaction and bills that didn’t gain traction in prior General Assemblies, the bipartisan Pension Consolidation Feasibility Task Force brought forward a solid recommendation that these systems be consolidated. Republicans and Democrats worked together to pen legislation that received nearly 100 bipartisan votes in the House.”
The task force’s report estimated that over the next five years, consolidation could result in up to an to $2.5 billion in investment returns, which could mean lower contributions funded by property taxes, according to the release. According to recent estimates, Illinois’ downstate and suburban police and fire pension funds are underfunded by $11 billion.
“When held and managed separately, these funds earn significantly lower investment returns than larger pension plans,” Keicher said. “While there remains much more work to be done, today’s bill signing represents a great step forward in addressing the state’s pension crisis. Today was a win for the Illinois taxpayer.”