According to the PMTF (Pension Modernization Task Force), any changes to a two tier system in state pensions would not reap any savings until the lower tier employees begin to retire in 25 years. The task force also concluded that lowering benefits now would not impact the current funding status of the pensions. The current benefit structure is NOT to blame for the fiscal crisis of the pension systems. Rather it is the "state's inability to fund its pension system according to actuarial principles." We need to stop the practice of "pension holidays".
As a SURS participant, I have talked to other annuity recipients about the possibility of a means test for income taxation on SURS payments. Most have no objection with that possibility.
Avg annuity= $43,460 (Avg wages in IL = $45,020) (Avg in the IL 94th District $36,000)
Contribution from employees = 8% per year every year
Contribution from the state varied due to under-funding and "holidays" from any payment.
1995 plan to fund pensions to the 90% level by 2045 failed.
Cause of the pension problem: IL hasn't appropriated enough to both maintain state services and required pension contribution (which have been raided for nearly 30 years to balance the budget).
IL ranks in the lowest 20% of the amount that states pay for retirements.
Only 5.3% of Illinoisans are enrolled in JRS-GARS-SERS-TRS-and SURS combined. That ranks 49th out of 50 states.Private sector retirees can double dip with both pensions and Social Security!
76% of state retirees DO NOT get Social Security benefits (even if they earned them).
Any two-tier pension system would not reap benefits until 25 years down the road. The impact on existing pension participants would be negligible.