Chicago City Wire

Illinois’ heavily underfunded pension system has left many state pensioners worried about their retirement income, but a recent report from the Illinois Policy Institute reveals that House Speaker Michael Madigan (D-Chicago) and Senate President John Cullerton (D-Chicago) are poised to earn six-figure paychecks when they retire.

The General Assembly Retirement System includes a provision that grants lawmakers with lengthy stays in office annual spikes to their eventual pension rates. According to a recent article from institute senior writer Austin Berg, lawmakers who were elected before 2003 receive a 3 percent increase in their pension for every year they serve over 20 years or after the age of 55.

Were Madigan to retire this year, the provision would see his pension start at $81,000, jump to $130,000 in his second year of retirement and continue to grow by 3 percent each year after that.

The provision was added to the General Assembly’s pension system in 1989 in a bill that Cullerton helped finalize in committee. The measure received bipartisan support.

“While the speaker, Cullerton and other long-time lawmakers count their promised retirement money, they refuse to pass any real pension reform,” Berg wrote. “Meanwhile, ballooning pension costs crowd out essential services for vulnerable Illinoisans and put tapped-out taxpayers such as Fiorante on the hook for billions.”

Teresa Fiorante is a retiree who earns approximately $2,000 per month from her pension for a career as a secretarial worker for the Central States Pension Fund. A Cook County resident, Fiorante relies on her pension check, along with retirement benefits from her late husband and Social Security payments.

Speaking with the institute, Fiorante said she is worried about her ability to continue to live independently, as her pension fund is now bankrupt. Without that $2,000 per month, she will likely face significant lifestyle changes.

“I shouldn’t have to go live with my kids,” Fiorante said, according to the institute. “I’ve done everything right to be independent, but now I can’t be independent. My property taxes have doubled, and it’s going to force me out of my home. It’s like they have a gun to your head: Pay this bill or leave the state.”

Berg pointed to efforts from several lawmakers to address Illinois’ pension woes, as well as 40 lawmakers, including Gov. Bruce Rauner, who have opted out of the legislature’s system.

Berg endorsed an effort from Sen. Dale Righter (R-Mattoon) in the last legislative session to expand a retirement program currently in use in Illinois’ university system. Workers at the state’s higher education institutions can opt into a 401(k)-style plan rather than a pension plan, and nearly 20,000 have.

Under Righter’s proposal, all state workers would be given the opportunity to move to a 401(k)-style plan, while all new state employees would automatically be enrolled in it.

“It’s a retirement plan that the worker controls, not Springfield politicians, Berg wrote. "All lawmakers need to do is take that plan and expand it. But Madigan and Cullerton don’t like that idea. Instead, they nibble around the edges as the pension problem gets worse and worse. All while remaining in total control.”

Berg also proposed doing away with the General Assembly Retirement System, saying it currently has only enough funds to pay out two more years of benefits, and that state taxpayers are paying for both lawmakers and the pension fund that benefits retired lawmakers.

“Legislative leaders’ refusal to push real pension reform is another unfortunate symptom of their philosophy on so many other state issues: ‘It works for us, now pony up.’” Berg wrote. “It’s up to rank-and-file lawmakers to tell Madigan and Cullerton enough is enough.”