Pension Reform

Illinois’ SERS – Unchecked State-Sponsored Theft

View as PDF CHICAGO—Taxpayers United of America (TUA) today released the results of their updated analysis of Illinois’ State Employees’ Retirement System (SERS).
“SERS is the third largest of the government employee pension funds in Illinois, but in some ways, it’s even more efficient at stealing wealth from hard-working taxpayers for the benefit of the politically privileged,” stated Jared Labell, TUA’s director of operations. “Not only does SERS guarantee a 3% cost of living adjustment (COLA) compounded annually, but it also guarantees additional confiscation of taxpayers’ dollars through Social Security, and in some cases, Medicare.”
“Every annual pension featured on our list of the top 200 SERS government retirees exceeds $118,000. These retired government employees are set to collect multi-million dollar lifetime pension payouts that are largely taxpayer-funded. SERS, in line with Illinois’ irresponsible fiscal record, is critically underfunded at only 35.27%. SERS falls way short of even the commonly used standard to determine the overall health of a pension fund, a funding ratio of 80%. The optimal funding ratio is, of course, 100% or greater over a reasonable period of time, but SERS fails at meeting that reduced measurement by a large margin.”

  • Total number of 2016 SERS pension beneficiaries is approximately 66,465.
  • 880 collect pensions in excess of $100,000.
  • 13,960 collect pensions in excess of $50,000.
  • The average 2016 annual SERS pension is $35,568 (Many retirees also collect SS).
  • The average amount that employees paid into their own pension fund is $36,269, or 3% of their estimated lifetime pension payout.
  • The average estimated lifetime pension payout is $1,038,456 (SS not included).
  • The average age at retirement is 60.
  • The average years of employment are 24.
  • In fiscal year 2015, taxpayers were forced to pay $1,804,319,356 into the government pension fund.
  • In fiscal year 2015, SERS government employees paid $266,139,156 into their own pension fund.
  • The net return on investment for SERS in fiscal year 2015 was only 4.79%, or $681,377,052.
  • As of the end of fiscal year 2015, SERS had a 35.27% funded ratio with a $28 billion unfunded liability.

“Taxpayers are forced to pay 678% more than the multi-millionaire pensioners pay into their own SERS pension fund annually. This means for every dollar that an SERS government employee pays into their own retirement fund, taxpayers are forced to pay $6.78!”
“Taxpayers have paid more than their fair share for these lavish government employee benefits, and yet the unions, bureaucrats, and politicians continue to push for expanding the tax burden of Illinois residents to fund their pensions, instead of calling for reform to this broken system,” said Labell. “As shortfalls in the funding of these government pensions mount, the political class in Illinois should expect nothing short of bankruptcy of their constituents to guarantee these egregious pension payments continue. After all, the Illinois state constitution currently protects only the government pensioners, and not the taxpayers, so there is undoubtedly a lopsided caste system in Illinois, created and expanded over many decades for the benefit of the minority of Illinois residents who are employed by the government.”
“For private sector retirees, the maximum Social Security payout for 2016 is $31,668, and there are no cushy, automatic cost of living increases in Social Security benefits for taxpayers that compare to those received by retired government employees. And let’s not forget, nearly all SERS members also receive Social Security benefits in addition to their gold-plated pension payments highlighted in our study,” said Labell.
“We need political courage in Springfield to halt this rapidly growing government pension debacle. Without overstepping the constitutional limitations for reform, the Illinois General Assembly could offer legislation that would immediately place all new hires into individual retirement savings accounts, like a 401(k), and enact the legislation required to allow bankruptcy of municipalities and retirement funds as a way of beginning to protect taxpayers from decades of financially problematic policies.”
“Today’s taxpayers should not be required to pay for services rendered years ago, just as bureaucrats and politicians should not be allowed to balance today’s budgets on the backs of tomorrow’s taxpayers. Reforms are unquestioningly necessary. Reform will benefit all Illinoisans economically if the tax burden and unfunded liabilities are diminished before more benefits and services are cut to perpetuate the current unsustainable government pensions.”
Sadashiv D. Parwatikar, retired from Chester Mental Health Center, tops our list with a stunning $207,623 annual pension! The accumulation of those payments, over a normal lifetime, will reach about $3.8 million. Personal contributions to that gold-plated pension were only $121,041.”
Cindy L. Benson, retiring from Personal Services – Sworn, ties with her counterpart, James C. Morrisey, for the highest estimated lifetime pension payouts of this study. Both retiring at only 50, they could each collect more than $7.6 million in taxpayer funded pension payments over the course of their retirement. Their current annual pensions are a very cushy $125,539!
Kamal Modir tops our list for the highest total SERS pension collected to date at $2,652,929. His own payment into this extravagant government pension was a mere $101,605 – or 2.5% – of his estimated lifetime pension payout.”

“Real reform must start immediately to halt the unfunded government pension liabilities, which grow exponentially as long as the status quo is maintained. Ousting politicians who answer to union thugs, rather than the taxpayers they are elected to represent, is also key to transforming Illinois from a financial pariah to an economic phoenix. Kicking political bosses out of office, like House Speaker Michael J. Madigan, who pushed for the government pension protections in the 1970 Illinois Constitution, as well as his likeminded cronies, is critical if taxpayers want to see substantive changes in the state government and our economic climate,” concluded Labell.
*Lifetime estimated pension payout includes 3% COLA (simple interest) and assumes life expectancy of 85 (IRS Form 590). Nearly all SERS pensioners also receive Social Security benefits in addition to their SERS

IMRF – The Gold Standard in Taxpayer Abuse

View as PDF CHICAGO—Taxpayers United of America (TUA) today released the results of their updated analysis of Illinois Municipal Retirement Fund (IMRF).
“The IMRF, although touted as the gold standard in government pension funds, is just as efficient at stealing taxpayer wealth to benefit the political elite as any Illinois State pension fund,” stated Jim Tobin, TUA president.
“The entire list of the top 200 IMRF annual pensions exceeds $116,000 with multi-million dollar lifetime payouts that are largely taxpayer funded. Although the IMRF is adequately funded, that doesn’t make it fair to taxpayers, especially considering that the total unfunded liabilities for Illinois government pensions is far in excess of $111 billion.”
“All of these top 200 ‘poor civil servants’ collected salaries of at least $100,000 with some as high as $400,000. Nearly all IMRF employees are also eligible for Social Security benefits in addition to their IMRF pensions,” added Tobin. “Let’s not forget that 80% of municipal taxes, including property taxes, go to pay government employee salaries, pensions, and benefits.”

  • Total number of IMRF pension beneficiaries is approximately 119,556.
  • 478 collect pensions in excess of $100,000.
  • 5,916 collect pensions in excess of $50,000.
  • The average 2014 annual IMRF pension is $17,268.
  • The average amount that employees paid into their own pension fund is $19,030, or 4.6% of their estimated lifetime pension payout.
  • The average estimated lifetime payout is $411,998*.
  • The average age at retirement is 62.
  • The average years of employment are 18.
  • In fiscal year 2014, taxpayers were forced to pay $923,382,825 into the government pension fund.
  • In fiscal year 2014, local and county government employees paid $351,089,445 into their own pension fund.
  • The net return on investment for IMRF in fiscal year 2014 was only 5.8%, or $2,001,440,028.
  • As of the end of fiscal year 2014, IMRF had an 87.3% funded ratio with a $4.8 billion unfunded liability.

“Taxpayers are forced to pay $2.63 for every $1 the multi-millionaire pensioners pay into their own IMRF pension fund annually, or 263%. I can’t think of a single private sector employer who does that. Social Security payments by the employer are an equal match to employee payments. You won’t see any gold-plated, multi-million dollar Social Security lifetime payouts. The maximum Social Security payout for 2016 is $31,668, and there are no cushy, automatic cost of living increases in Social Security benefits. And again, let’s not forget that nearly all of IMRF members also get Social Security payments in addition to the pension payments highlighted in our study.”
“Until all government employees are moved from the current defined-benefit pension system to 401(k) style retirement savings accounts, the system will remain unsustainable and unfair to taxpayers. But this type of positive, sweeping reform cannot occur without first amending the Illinois Constitution by removing the government employee pension protection clause. However, the Illinois General Assembly could immediately require that all new government employees be placed in a 401(k) style defined-contribution plan, which would eliminate additional unfunded government pension liabilities immediately.”
“Today’s taxpayers should not be required to pay for services rendered years ago, just as bureaucrats and politicians should not be allowed to balance today’s budgets on the backs of tomorrow’s taxpayers. Let’s make necessary reforms that will benefit all of Illinois economically and finally do something that actually is ‘for the children.’”
“To help the average taxpayer understand the problem, we list the names of the pensioners and the amounts they collect in retirement,” added Tobin. “It really hits home when people see the names of their local ‘civil servants,’ people in their community that they know at least by name, and the outrageous amount of taxpayer dollars they collect in retirement while doing absolutely nothing.”
“Edward A. Anderson, retired from CGH Medical-Sterling, tops our list with a mind-boggling $306,621 annual pension! The accumulation of those payments, over a normal lifetime, will reach about $6.2 million. His contribution to that gold-plated pension was only $312,570.”
“Roy F. McCampbell tops the list for estimated lifetime pension payouts. Retiring at only 56 from the Village of Bellwood, he could collect more than $6.8 million in taxpayer funded pension payments. His current annual pension is a very lucrative $263,809. He collects this wealth from taxpayers in a community where 12.8% of the population lives below the poverty level and the per capita income is only $20,395!”
“Albin D. Pagorski tops our list for the highest total IMRF pension collected to date at $3,083,099. His own payment into this extravagant government pension was a meagre $93,910 or 2% of his estimated lifetime pension payout.”

“Illinois House Speaker Michael J. Madigan, AKA: Boss Madigan, has had the Illinois taxpayers in his death grip for far too long. Every taxpayer needs to vote in the upcoming Illinois Primary on March 15, 2016 and vote out every incumbent who has played a role in taxpayer abuse, stripping wealth from us to put in the pockets of the government retirees. The constitutional protection of this redistribution of taxpayer wealth is criminal,” charged Tobin. “The only way to enact real reform is to oust the guilty parties who answer to union thugs, rather than the taxpayers they are elected to represent,” he concluded.
*Lifetime estimated pension payout includes 3% COLA (simple interest) and assumes life expectancy of 85 (IRS Form 590). Nearly all IMRF pensioners also receive Social Security benefits in addition to their IMRF pension. Any blank spaces in the data are intentional and due to government redactions or withheld data points in response to Freedom of Information Act requests.

Madison Record|Haine and Haida among top IMRF beneficiaries in state; Though adequately funded, critic says pension system 'just as efficient at stealing taxpayer wealth'

President and founder of Taxpayers United of America (TUA), Jim Tobin, was quoted by Madison Record about the latest IMRF Pension data release.


The top Illinois Municipal Retirement Fund (IMRF) beneficiaries in Madison and St. Clair counties are among the state’s highest paid. And both of them – a lawmaker and a judge – are accruing benefits in other pension systems that will provide even more tax payer-supported income for life when they retire a second time.
State Sen. William Haine (D-Alton), who served as Madison County State’s Attorney for 14 years (1988-2002), began receiving IMRF pension benefits one month after he was elected to the 56th Senate District in November 2002.
According to Taxpayers United of America (TUA) pension analysis, Haine currently receives $148,042 annually from IMRF. He began receiving pension payments on Dec. 1, 2002 at age 58. He retired after 26.5 years of credited service at the county, which included work as a public defender and county board member.
To date, Haine has received $1,714,021 in IMRF payments. He contributed $110,031 into the system. Based on a life expectancy of 85, Haine will receive an estimated $3,033,922 in lifetime benefits from the IMRF.
His current salary as state senator is $67,836, plus he receives $111 per diem while in session. His total tax-payer supported annual income is approximately $228,804.
When he is no longer a state legislator, Haine will be eligible for benefits from another state pension system – the General Assembly Retirement System (GARS).
In St. Clair County, Circuit Judge Robert Haida, who served as St. Clair County State’s Attorney for 19 years (1991-2010), began receiving IMRF pension benefits in 2012, two years after he was elected to the Twentieth Judicial Circuit.
Haida currently receives $154,084 annually in IMRF benefits. He was 55 when he retired as state’s attorney; he is credited with having worked 24.6 years as a county employee, which also included time as an assistant state’s attorney.
To date, Haida has received $520,442 in IMRF payments. He contributed $209,176 into the system, and will have received an estimated $4,283,142 at age 85.
As a circuit judge he is paid $178,835, bringing his total tax-payer supported annual income to $332,919.
When he is no longer a judge, Haida will be eligible for benefits from another state pension system – the Judicial Retirement System (JRS).
The state senator and circuit judge – both of whom seek to keep their seats in the November general election – were named to the TUA’s list of top 200 IMRF beneficiaries, Haida in 40th place and Haine in 50th.
“The IMRF, although touted as the gold standard in government pension funds, is just as efficient at stealing taxpayer wealth to benefit the political elite as any Illinois state pension fund,” said Jim Tobin, TUA president, in a press release.
“The entire list of the top 200 IMRF annual pensions exceeds $116,000 with multi-million dollar lifetime payouts that are largely taxpayer funded. Although the IMRF is adequately funded, that doesn’t make it fair to taxpayers, especially considering that the total unfunded liabilities for Illinois government pensions is far in excess of $111 billion.”
The TUA reported these statistics regarding the IMRF:
• Total number of pension beneficiaries is approximately 119,556
• 478 collect pensions in excess of $100,000
• 5,916 collect pensions in excess of $50,000
• The average 2014 annual pension is $17,268
• The average amount that employees paid into their own pension fund is $19,030, or 4.6 percent of their estimated lifetime pension payout
• The average estimated lifetime payout is $411,998, based on a life expectancy of 85 and an annual 3 percent cost of living adjustment
• The average age at retirement is 62
• The average years of employment are 18
• In fiscal year 2014, taxpayers were forced to pay $923,382,825 into the government pension fund
• In fiscal year 2014, local and county government employees paid $351,089,445 into their own pension fund
• The net return on investment for IMRF in fiscal year 2014 was only 5.8 percent, or $2,001,440,028
• As of the end of fiscal year 2014, IMRF had an 87.3 percent funded ratio with a $4.8 billion unfunded liability
Tobin and other pension reform advocates support changing public pension systems from the current defined-benefit system to 401(k) style retirement savings accounts.
“But this type of positive, sweeping reform cannot occur without first amending the Illinois Constitution by removing the government employee pension protection clause,” Tobin stated. “However, the Illinois General Assembly could immediately require that all new government employees be placed in a 401(k) style defined-contribution plan, which would eliminate additional unfunded government pension liabilities immediately.”
He said that taxpayers are forced to pay $2.63 for every $1 that pensioners pay into their own IMRF fund annually, or 263 percent.
“I can’t think of a single private sector employer who does that,” he stated. “Social Security payments by the employer are an equal match to employee payments.
“Today’s taxpayers should not be required to pay for services rendered years ago, just as bureaucrats and politicians should not be allowed to balance today’s budgets on the backs of tomorrow’s taxpayers. Let’s make necessary reforms that will benefit all of Illinois economically and finally do something that actually is ‘for the children.’”
A pension reform bill passed by the state legislature in 2013 was struck down by the Illinois Supreme Court last year when it sided with public unions in ruling that the state was obligated to protect public worker pensions.
And ever since Republican Gov. Bruce Rauner was elected in 2014 on a reform platform, Democrat lawmakers, who control both branches of state government, have resisted his proposals to transform the state’s under-funded pension systems.
Legislation introduced by Republicans this session would give retired government workers a choice in collecting benefits over several years, or cash out immediately but with a smaller lump sum.
Two bills on the subject were discussed during a testimony-only committee hearing last week – House Bill 4427 sponsored by State Rep. Mark Batinick (R-Plainfield) and House Bill 5625 sponsored by State Rep. Mike Fortner (R-West Chicago).
As reported by Illinois News Network last week, under one scenario in Batinick’s plan, it would take the state a $700,000 up-front investment to fund the pension of an employee projected to draw $50,000 annually.
The legislation would offer workers essentially three options: Accept the $50,000 annual pension; take an immediate payout at about 75 percent of $700,000; or take an immediate, partial amount and still get an annual pension payment — although smaller than $50,000, according to the report.
Chairperson of the House Personnel and Pensions Committee Elaine Nekritz (D-Northbrook) said the state should not force workers into reduced, lump sum payouts.
That decision, Nekritz said, “would have to be completely voluntary and only at the whim and desire of the participants,” the Illinois News Network report stated.

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Taxpayers United Of America: (TUA). is a nonpartisan, 501(c)(4) taxpayer advocacy group. Founded June 27, 1976 in Chicago, Illinois by activist and economist Jim Tobin, TUA works on behalf of taxpayers to reduce local, state, and federal taxes. In the past forty years, TUA has saved taxpayers more than $200 billion n taxes and has become one of the largest taxpayer organizations in America. Check All posts. s.

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