Pension costs projected to take up nearly a fifth of Illinois' general budget
Illinois Gov. Pat Quinn is expected to announce Wednesday that the state will spend almost a fifth of its general budget on pension payments next year.
In his budget address to state lawmakers, Quinn is expected to detail how he wants the state government to spend about $35.6 billion in the 2014 fiscal year. His budget office estimated the state will spend 19 percent of its general budget, more than $6 billion, on pension benefits alone.
“This is extremely painful presentation that we’re making,” said Quinn’s budget director, Jerry Stermer.
Stermer said that because more money would be going to pay teachers, judges and other state workers’ retirement benefits, there would be less cash for other state programs, including public schools.
Lawmakers have proposed some various measures to address the state's growing pension costs and $97 billion in unfunded liabilities, but legislative leaders and the governor have not come to an agreement.
Stermer said the governor is not proposing new taxes or fees in next year’s budget. After Quinn won election in 2011, he raised the personal income tax and corporate income tax. Those rates are scheduled to drop somewhat in 2015, although it’s likely to be a key topic of debate during next year’s race for governor.
Meanwhile, the state is also dealing with a backlog of bills in the billions, often paying vendors late. The governor’s staff wouldn’t say how he’s proposing to cut the money owed, but his budget office projects the total backlog will be cut from $7.5 billion to $6.8 billion next year.