CHICAGO (AP) – A report shows a pension buyout program offered to members in Illinois’ three largest retirement systems in hopes of saving the state millions of dollars has fallen considerably short of anticipated savings in its first year.
Buyout savings were expected to reduce Illinois pension contributions from general operating funds by more than $400 million for the fiscal year that ended June 30.
But the Chicago Tribune reports an analysis by budget watchdog, the Civic Federation, reveals the buyouts have only produced around $13 million in general funds savings, which came from the State Employees’ Retirement System.
Illinois has the nation’s lowest credit rating , partly due to its unfunded pension liabilities that totals nearly $134 billion. The state can sell up to $1 billion worth of bonds to fund the buyouts.
