Sunday, November 21, 2010

Illinois Pension Debt Service 1.7 Billion dollars in FY2011

The Chicago Civic Federation is out with their analysis of the states proposed FY2011 Budget, quite an eye opening read.

There is a lot in the document, but for the moment I am going to just focus on the costs of current and proposed pension borrowing (page 28 of the PDF file, 24 of the document).

The 2010 pension borrowing is going to cost the state $1.147 Billion dollars in FY2011 or roughly about 100 million more than the state expects to make off of the lottery and casino gaming.

But that is just the 2010 borrowing, we still have the pension borrowing from 2003 that we are still paying off, and that adds $543 million to the total so it comes to about 1.6 Billion.

If you include the proposed borrowing for FY2011 you end up with average yearly spending on pension debt service at over 1.5 billion FY2018 (it dips to $1.45 billion in FY2016 before going up another 140 million in FY2017. Why in part because the 2011 borrowing will be back loaded to the later years (be thankful for that otherwise the payments starting in 2012 would really be a problem).

So next time someone says "The lottery and casino gaming is used to pay for education, point out it is going to be used for a while to pay for the states inability and lack of desire to fund it's pensions properly"

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