Pritzker: State won’t force pension responsilities onto local schools, governments

Local governments won’t have to face paying back huge pension debts alone, but for the state to help a new taxing system is necessary, Gov. J.B. Pritzker told the Daily Herald editorial board Monday.

Asked if he viewed pension debt “as a state responsibility and not something the state is just suddenly going to dump on a school district or municipality,” Pritzker replied, “That’s right.”

“We’re all one state, he said. “I’m the governor of the state, so I’m worried about local property taxes just as I am about state income taxes. I want make sure we’re not overburdening people.”

Pritzker is leading the charge to switch from a flat income tax to a progressive system that charges different rates to people based on their earnings.

How to pay for out-of-control pension obligations to employees is a recurring theme expressed by candidates in the April 2 municipal elections.

In his budget address last week, Pritzker said a progressive tax is part of the long-term solution to pension debt and pledged to dedicate a portion of it — hundreds of millions of dollars — toward pensions.

“You cannot talk about a budget in the state of Illinois without trying to deal with pensions and one thing we’re trying to do is put more assets in the system,” he said Monday.

The state faces about $134 billion in unfunded pension liabilities.

Voters would have to pass a referendum to change the tax system. If approved, the earliest the new rates would go into effect is January 2021, Pritzker said.

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via > Illinois News

March 4, 2019 at 12:07PM

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