Reports

Update: Addressing Illinois’ Pension Debt Crisis With Reamortization

Release: October 21, 2019

Illinois' five state pension systems face a debt crisis after years of intentional borrowing from state contributions. The crisis is compounded by a backloaded repayment plan that calls for unrealistic, unsustainable state contributions in future years, putting funding for crucial public services at risk. Because the crisis is about debt, rather than benefits being earned by current and future employees, attempts to solve the problem through benefit cuts have failed. CTBA proposes resolving the pension debt crisis by reamortizing our payment schedule, creating a sustainable, level-dollar plan that saves the state $45 billion and gets the pension systems 70 percent funded by 2045. The state of Illinois has foregone $22 billion in savings since CTBA originally proposed to reamortize the debt in 2018. To bridge the higher contributions called for in the first several years of the reamortization plan, CTBA suggests using bonds to ensure current services do not have to be cut.

How a graduated rate income tax would help reduce after-tax income inequality in Illinois

Release: May 22, 2019

Since 1979, the nation has seen a rapid and significant increase in income inequality between low- and middle-income Americans on the one hand, and the wealthiest one percent on the other. Over that time span, the bottom 99 percent of American households saw their incomes increase by an average of just 14 percent after inflation. Meanwhile, the wealthiest one percent saw their inflation-adjusted incomes balloon by 175 percent on average—or fully 12.5 times more than the income growth realized by everyone else.

Press Release: A Graduated Rate Income Tax Would Help Reduce After-Tax Income Inequality in Illinois

Release: May 22, 2019

The Center for Tax and Budget Accountability (CTBA) released a report, How a Graduated Rate Income Tax Would Help Reduce After-Tax Income Inequality in Illinois, which shows that the implementation of a graduated rate income tax can reduce the regressivity of Illinois’ state and local tax system while lessening after-tax income inequality, which imposes lower tax rates on lower levels of income and higher rates on higher levels of income,

Fully Funding the Evidence-Based Formula: Four Scenarios

Release: March 27, 2019

On August 31, 2017, Illinois decision makers finally jettisoned one of the least-equitable K-12 public education funding formulas in the country and replaced it with the Evidence-Based Funding for Student Success Act, or EBF. The EBF represents the best practice in school funding because it ties the dollar amount taxpayers invest in schools to those educational practices which research shows actually enhance student achievement over time.  David G. Sciarra, Education Law Center, Is School Funding Fair?

Asset transfers to the state pension systems: Six questions to be answered

Release: February 18, 2019

One idea that has been proposed by a number of observers to repay some of Illinois’ pension debt is an “asset transfer.” Under this proposal, the state (or the City of Chicago, which is also facing a large pension debt problem) would make a contribution to the pension systems in the form of a publicly owned property, such as a tollway or lottery, rather than in the form of cash.

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