As part of a situation that’s been ongoing since July 1, the state of Illinois announced they will be delaying pension payments in the month of November. State Comptroller Leslie Munger said in mid-October that $560 million in pension payments scheduled for November will be put on hold due to the state’s budget impasse, according to the media conglomerate Reuters.com.
“The fact is that our state simply does not have the revenue to meet its obligations,” Munger told a news conference in Chicago.
The news comes as no surprise to anyone with knowledge of the situation or Illinois’s track record in general. The Prairie State has the worst-funded pensions and lowest credit ratings among the 50 U.S. states. Despite those facts, Munger has promised the pensions will be paid in full by the end of the 2016 fiscal year on June 30.
Add Munger to the list of Illinois citizens who are sick and tired of the political standstill. She urged the Republican Governor Bruce Rauner and Democratic-controlled state legislature to come together and pass a budget. Currently, the state owes $3.4 billion to debt service payments on bonds in addition to the billions of dollars they owe in-state lottery winners. Any win over $600 cannot be paid out until a budget is passed.
The one piece of good news for the struggling state is that the delay shouldn’t affect the Illinois Teachers’ Retirement System (TRS), which is their largest pension obligation group. A spokesman for the TRS said they currently have enough money to provide the 100,000+ retired teachers with their annuity money at least until the end of the year.
“If they say we’ll get the money by the end of the year, that’s terrific,” TRS spokesman Dave Urbanek told Reuters. “We have enough money on hand in the trust fund now to pay all the pension payments.”