HR0575 LRB095 12638 AMC 37921 r

1
HOUSE RESOLUTION

 
2     WHEREAS, Article XIII, Section 5 of the Illinois
3 Constitution of 1970 requires the State to provide pension
4 benefits to members of State-sponsored retirement systems; and
 
5     WHEREAS, The State of Illinois supports five retirement
6 plans on behalf of State employees, university employees,
7 teachers, judges, and members of the Illinois General Assembly;
8 and
 
9     WHEREAS, It is the State's responsibility to provide
10 adequate funding to support State pension liabilities so that
11 future generations are not held responsible for current
12 expenses; and
 
13     WHEREAS, Deferrals of the State's obligations to its
14 annuitants contributed to an unfunded pension liability in
15 State-sponsored systems of $19 billion in 1995 to $43 billion
16 in 2003, resulting in a funded ratio of 48% in 2003, the worst
17 funded ratio of any of the fifty States and significantly
18 under-funded in comparison to the national average of 91.1%
19 among 101 public retirement systems according to the 2003
20 Public Fund Survey conducted by the National Association of
21 State Retirement Administrators; and
 

 

 

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1     WHEREAS, The Civic Committee of the Commercial Club of
2 Chicago's Task Force on Illinois State Finance, in recognition
3 of this crisis, reported that unless changes are made
4 "commitments to State employees will become a huge burden on
5 future generations or will not be kept at all"; and
 
6     WHEREAS, Annuitants of the State's benefit systems rely on
7 the security provided by pension benefits to meet their daily
8 necessities, including food, housing, and healthcare; and, as
9 the Civic Committee has recommended, "Illinois should keep its
10 obligations and commitments to those who have worked for it and
11 who will work for it in the future. Failure to fund adequately
12 to cover such obligations is unfair to employees whose rights
13 have vested"; and
 
14     WHEREAS, Over the next three years, in order to meet the
15 statutory funding formula, the State will be required to
16 increase annual contributions to the pension systems and debt
17 service on outstanding pension obligation bonds, reducing
18 available State resources to fund growth in other core services
19 provided by the State, such as education and health care, to
20 less than $200 million (or less than 1% growth) of natural
21 revenue growth per year; and
 
22     WHEREAS, Further deferrals of the State's pension
23 liabilities will force future generations to pay billions in

 

 

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1 additional interest on the unfunded liabilities of the State
2 between fiscal years 2008 and 2045; and
 
3     WHEREAS, In recognition of the funding crisis caused by the
4 State's persistent under-funding of its pension obligations
5 and other past deferrals, the Civic Committee has stated that
6 "Good government in a democracy involves making hard choices.
7 The citizens who live in Illinois and pay taxes here, and the
8 businesses located here, all must make such choices. Their
9 government should do no less. Avoiding such choices undercuts
10 democracy."; therefore, be it
 
11     RESOLVED, BY THE HOUSE OF REPRESENTATIVES OF THE
12 NINETY-FIFTH GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, that
13 the State's pension funding system is in a state of crisis, and
14 that the State will continue to unnecessarily pay billions in
15 interest costs alone if the unfunded pension liability does not
16 receive an immediate and significant infusion of funding, the
17 General Assembly is in agreement that a solution to this crisis
18 must be adopted prior to adjournment of 2007 Spring Session of
19 the Ninety-Fifth General Assembly; this action is necessary to
20 adequately secure existing pension obligations, reduce
21 long-term interest costs on current obligations, more
22 effectively manage State funding requirements, and ensure that
23 future new revenues will not be consumed solely by escalating
24 pension contributions; and be it further
 

 

 

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1     RESOLVED, That the General Assembly shall enact any such
2 additional protections necessary to ensure that no further
3 State pension liabilities may be deferred to future generations
4 of Illinois citizens.