Retirement systems to be paid in full by end of fiscal year
CHICAGO, IL – Illinois Comptroller Leslie Geissler Munger on Wednesday announced that a cash shortage caused by the ongoing state budget impasse will force Illinois to delay its November pension payment, but she stressed the retirement systems will be paid in full by the end of the fiscal year.
Without a budget in place, the state is operating under a series of court orders, consent decrees and continuing appropriations requiring it to pay bills at last year’s rates, despite projections showing a $5 billion decline in revenue. The resulting cash shortage has caused the state’s unpaid bill backlog to swell to $6.9 billion this month, and will force the Comptroller’s Office to delay a $560 million monthly pension payment in November.
Despite the delay in the state’s payment to the retirement systems, retirees will continue to receive their benefits checks as scheduled.
“This decision came down to choosing the least of a number of bad options and it saddens me that we’ve reached this point. But the fact is that our state simply does not have the revenue to meet its obligations,” Munger said. “We will use every available dollar in the higher revenue months this Spring to catch up with our commitments and ensure that our retirement systems are paid in full.”
Faced with the ongoing cash shortage, Munger has prioritized payments for nonprofits serving children, the elderly, people with disabilities and other most vulnerable residents. She is additionally required to ensure the state does not default on its debt service payments, and to meet state payroll.
Still, the consequences of the budget impasse are seen on a daily basis across the state, Munger added.
“Families, businesses and organizations are paying the price for inaction in Springfield every single day,” Munger said. “Nonprofits have had to shut their doors, our most vulnerable residents have lost access to services they depend on, college students are not receiving promised grant money and local governments are struggling to keep 911 Emergency call centers operating in the absence of funding.
“State government is not serving anyone well right now,” she added. “It is incumbent on the General Assembly and Governor to lock arms and pass an agreement that will allow Illinois to regain its fiscal footing.”