As the Illinois Supreme Court considers the constitutionality of the state’s pension plan reform law and Gov. Bruce Rauner (R) considers proposing a 401(k)-style pension plan for many government employees, local cities must address immediate challenges posed by their pension plans. Rauner’s proposed 2016 budget, which includes a provision that would halve the local income tax allotment, could add to those pressures, according to the Daily Northwestern.
Northwest Municipal Conference Executive Director Mark Fowler observed that the plan would impair the ability of the 44 municipalities and one township that make up the Northwest Municipal Conference to address their pension problems, since in Illinois cities can use income tax revenue to help cover deficits.
Pension challenges are a catalyst in the northern suburbs of Chicago considering a plan that would consolidate local pensions, reports the Daily Northwestern. Evanston Chief Financial Officer and Assistant City Manager Marty Lyons expressed support for the idea, which he said could better enable cities that are part of a consolidation to make a broader range of investments than they can right now, a step that would help increase the revenue they could raise, he said.
But pension challenges are not reserved to the suburbs — Chicago feels them, too. And Standard & Poors recently reminded America’s third-largest city that now that its mayoral election is over, it can focus attention once again on its pension obligations.
S&P Credit Analyst Helen Samuelson said that S&P expects Chicago to take action to meet its budget and pension challenges in the short and long run. Failure to do so, S&P warns, would jeopardize Chicago’s A+/Negative general obligation debt rating.
Northwest Municipal Conference Executive Director Mark Fowler observed that the plan would impair the ability of the 44 municipalities and one township that make up the Northwest Municipal Conference to address their pension problems, since in Illinois cities can use income tax revenue to help cover deficits.
Pension challenges are a catalyst in the northern suburbs of Chicago considering a plan that would consolidate local pensions, reports the Daily Northwestern. Evanston Chief Financial Officer and Assistant City Manager Marty Lyons expressed support for the idea, which he said could better enable cities that are part of a consolidation to make a broader range of investments than they can right now, a step that would help increase the revenue they could raise, he said.
But pension challenges are not reserved to the suburbs — Chicago feels them, too. And Standard & Poors recently reminded America’s third-largest city that now that its mayoral election is over, it can focus attention once again on its pension obligations.
S&P Credit Analyst Helen Samuelson said that S&P expects Chicago to take action to meet its budget and pension challenges in the short and long run. Failure to do so, S&P warns, would jeopardize Chicago’s A+/Negative general obligation debt rating.
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