While Texas runs an $8.8 billion surplus, Illinois is heading in the opposite direction. A new report by the Civic Federation estimates that Illinois’ “unpaid bills” will triple to $22 billion in the next five years unless something can be done about the state’s pensions. The Chicago Sun-Times reports:
Without meaningful reform, pension costs will continue to overwhelm the state’s budget. Total pension payments – including contributions and debt service on pension bonds – would increase nearly 30 percent from $6.7 billion this year to $8.6 billion in fiscal year 2018, the Civic Federation warns.
If that scenario were to play out over the next half-decade, the state’s total pension payments would eat up nearly one-third of state-generated revenue, whereas today the payments consume about 22 percent.
The forecast has shown some improvement. Last year, the five-year backlog was estimated at $35 billion, but the state was able to cut it down to $22 billion by making major cuts to Medicaid last June.
Unfortunately, this didn’t come close to solving the state’s budget problems, and there doesn’t seem to be much appetite for further reforms on top of this already controversial measure. Governor Pat Quinn already gave pension reform his best shot earlier this year and came up short, and the chances that the legislature will agree to more cuts than they already have are not looking good for the immediate future.
In the meantime, Texas will continue to pull ahead.