Keefe, Campbell, Biery attorney warns of looming state fiscal disaster
Thanks to a guaranteed annual cost of living pay increase for state pensioners, as well as years of inadequate pension funding, Illinois now sits on the edge of fiscal calamity, warns the law firm of Keefe, Campbell, Biery & Associates.
Once state employees retire, their pension provides them with 85 percent of their working salary, according to a May 16 blog post. For example, a $100,000-a-year worker who retires with $85,000 in annual pension income could double their pay over the course of 23 years, thanks to the state constitution, which compounds a 3 percent annual increase.
“Yes, that worker will be getting $170,000 a year in a fake and unfunded government pension when their pay was only $100,000 a year,” partner Eugene Keefe wrote in the post. “In 23 years after initial retirement, the government pension will quadruple and they will be getting more than $1 million every three years not to work.”
Out-migration caused by rising taxes, according to Keefe, is eroding the state’s tax base and causing a scarcity of jobs, as businesses and individuals relocate to more economically favorable states.
Keefe said the mathematics behind the pension crisis is “immutable,” and advised readers to emigrate elsewhere unless they wanted to “pay 100 percent of the spiraling fake pension costs for all those former state workers who are becoming wealthy off our dime.”
Over the years, Keefe said in the release, governors have borrowed money to shore up the debt crisis, causing 23 credit downgrades in the last decade. If the Democratic candidate for governor J.B. Pritzker were elected, Keefe warned the state income tax (now 4.95 percent) could double.
To remedy the situation, Keefe said cost-cutting from the consolidation of government entities could trim $5 million to $10 million from the state’s $30 million budget for the Workers Compensation Commission.
“Yes, it might take longer to get some things done (after cutting the budget), but I bet we can and would adjust,” Keefe said in the release.
Keefe also recommended downsizing state government, including consolidating the Treasury Department and Comptroller, eliminating the “do nothing” lieutenant governor, and abolishing remote offices and police departments for specific state agencies.
“I can’t help you avoid property taxes, specifically the new and huge tax increase proposed by these federal economists,” Keefe said in the post. “I can legally help you avoid skyrocketing IL income and estate taxes if you are interested in moving to a different state while maintaining a part-time Illinois residence.
Keefe said the procedure is fully legal, according to a recent Supreme Court decision.