Transparency efforts in Illinois continue to moving forward but in fits and starts. The Governor announced this week that he is appointing a new actuary to closely monitor the financial activities happening within the state pension program. The effort comes after it was revealed that the program had given billions to investment managers in performance fees, despite only realizing minimal returns from their investments. More information will also be added to the state’s transparency website including some state salaries.
Currently, the state of Illinois has 5 state pension systems in place for various public workers including teachers, police, and fire fighters. Together, these give programs have an $89 billion unfunded liability – a common problem plaguing state pension systems across the country. However, in April, the state launched an investigation into the state teacher’s pension plan after it became clear that billions of dollars had been paid to various investment managers and consultants in performance fees even though, the fund itself was only realizing marginal returns.
As CivSource reported earlier this week, along with Medicaid, the state pension system accounts for nearly half of the state budget spend. The Governor pressed the statehouse to pass a cost containment package during this legislative session, but lawmakers were unable to close the deal. However, the legislature was able to pass a bill to create a new actuary position to oversee the funds. The actuary will work with state auditors to monitor future contributions and try to contain costs going forward.
“We must restore integrity and accountability to the state’s pension systems and we are headed in the right direction with this new law,” Governor Quinn said. “Now is the time to roll our sleeves up and continue to work together to fundamentally reform our pension system and rescue it from drowning in an ocean of unfunded liability.”
The Governor also signed another bill today that will ask state retirees to pay more into their after-retirement insurance benefit based on their ability to pay. The measure is another in ongoing efforts to control state retiree benefits which have been steadily taking more and more of the state budget each cycle.
The efforts are also designed to increase overall transparency of state government – an area where Illinois has had spotty success at best. A recent bill to make corporate tax incentive details public was coldly received by the Governor who has been relying on such deals in an effort to keep jobs in the state.
Despite some challenges in bringing more information to the public, the state did announce that it will expand the information available on Illinois Ledger a state transparency site operated by the Controller. The Ledger now shows how much the state has paid to groups and businesses that provide services to the government. Salary information and lobbyist reports from the General Assembly are also available.