Retiring Illinois Lawmakers Make Bank on the Way Out
The representatives and senators leaving office in January 2013 will see millions of dollars in pension payments, figures far more sizable than they would've seen in the private sector.
Are you worried about your own retirement? With the downturn in the economy, did your 401k and savings take a big hit? If so, you're like millions of other Americans forced to confront a dramatically different outlook for their post-work years. But one group of pensioners is largely insulated from such concerns — outgoing Illinois lawmakers.
The retirement benefits Illinois legislators receive are far more generous than those most of their constituents could collect working full-time jobs, reports Scott Reeder of the Reeder Report, using data from an Illinois Policy Institute analysis in a piece published on Watchdog.org.
The anticipated pension benefits of the 34 lawmakers who will depart the state legislature in January show these pensioners will see better returns than they ever could have investing on their own dime.
State Sen. Chris Lauzen, who has been in office since 1983 and served on the Committee on Pensions and Investments, the Subcommittee on Pension Enhancements and the Subcommittee on Pension Reform, put $141,358 into his state pension plan. The Kane County Republican will leave office with a projected annual pension of $63,384 and a lifetime payout of more than $1.8 million, reports Reeder.
An annuity with that kind of payout through the private sector would cost 10 times as much at $1.4 million, according to analysis by Jonathan Ingram at the Illinois Policy Institute, who computed the pensions of the outgoing legislators and the cash a private-sector worker would need to be able to purchase an annuity of equal benefit. (You can see the results of Ingram's work in the chart that accompanies this post.)
How do experts on pensions view these figures?
“Public pensions are inherently corrupt because it is the lawmakers deciding what their own pensions will be,” said Frank Keegan, an editor with State Budget Solutions. ...
Edward Zelinski, a law professor at Cardozo School of Law in New York and a national authority on pensions, called the Illinois legislative pensions “offensive.”
“I can’t say it is the most egregious in the nation, but I can say it is hard to believe there are many – or any – that are more egregious,” he said.
The lawmakers who leave office in January collectively are eligible for more than $25 million in pension payouts. The state legislature still has no plan to fix the $200 billion state pension shortfall, either.
Patch on Politics appears on the Patch network throughout the Chicago area.
Jim McMahon
11:28 pm on Saturday, December 15, 2012
I'm glad I voted for Jeanne Ives over the other candidates. Ives has said we need to get rid of these fat pensions for law makers.
Mike F.
1:23 am on Sunday, December 16, 2012
Don't worry, she'll do the same. When she loses or decides to step down, she'll make sure she gets a fat committee assignment to bump her pay.
Tom
6:48 am on Sunday, December 16, 2012
Jim, you might as well face it, politicians are only in office for one thing THEMSELVES. Would you spend millions to get a nickel and dime job if there wasn't a pot of gold at the end of the rainbow.
Wire Points
7:37 am on Sunday, December 16, 2012
The Patch covers this topic better than most major media: You got the size of the total problem right, which is $200 billion. Most other media continue to spew the state's lie that the problem is just $96 billion. We are covering this closely at www.wirepoints.com.
PAUL C.
8:02 am on Sunday, December 16, 2012
The public ( I included ) has slept through all of this pension entitlement over the past 30 years! Unless we all wake up and vote in new leaders who believe enough is enough and are willing to eliminate pensions and set term limits. The problem right now is too many of us are so apathetic and unaware of what these legislators earn and how much they''ll receive from these lucrative pensions.
Martha Hanna
8:28 am on Sunday, December 16, 2012
I think a lot of Americans want pension reform for elected officials. This is where we should start. Politicans do not need huge pensions and benefits. It's utterly ridiculous. It sickens me, and I am sick of it. We have BIG problems in this country, I want my tax money sovling problems, not paying politicans lifetime benefits...it is truly sickening.
Dan
8:51 am on Sunday, December 16, 2012
Step 1 Tax Pensions like any other income! Why are those blessed with pension income in a greater amount than many working people are earning in their jobs given a tax loop hole that allows some to get millions in taxfree income?
Ron
9:18 am on Sunday, December 16, 2012
Taxing pensions would also include your social security Dan. Illinois has no income tax on pensions or social security. Perhaps you should actually know what you are talking about before making unintelligent statements regarding what is taxed and what is not. I'm sure all of the people collecting social security in Illinois really support your statement. In fact, social security is not taxed federally unless it is more than $34k per year.
The 'loophole' allows people who collect social security to do the same thing. Just because you hear something and tell yourself something doesn't necessarily make it true.
Dan
2:45 pm on Sunday, December 16, 2012
Ron, I'm fine with taxing both private and public pensions. What exactly don't you think I understand? Many other states tax pension income so I don't think it is such a far fetched idea for the state with the largest pension underfunding to start taxing retirement income. So why is it okay to tax someone currently working to say earn $40,000 but not okay to tax someone receiving a similar amount in retirement income. I guess you have to be retired to appreciate the diference.
Ron
5:17 pm on Sunday, December 16, 2012
Did you even take the time to actually read the article above? It says nothing about the private sector and you chose to pile on and say 'tax pensions' but you forgot to mention anything about social security or the private sector. Remember, the private sector never said a word about pensions for decades until it has now become a crisis. Now it's a big deal but only for public employees. That's the way your original message is intended. You now clarified your position on the State of Illinois taxing social security earnings which in a sense is a form of a pension for the private sector.
http://www.ncsl.org/issues-research/budget/state-personal-income-taxes-on-pensions-1.aspx
If you have any knowledge of an economy you would certainly understand the importance of this state remaining tax free for retirement income. It helps those who are not in the workforce, it attracts people from other states, and can serve as economic development for the state. Forty-three states impose state income taxes on retirement earnings. Why be the 44th so the citizens of this state can move to the remaining six? Then who will foot the bill when they aren't paying any taxes towards the state and they still get away with paying no state income tax. You should try just a basic google search before you just make baseless claims. Use evidence to support your claims.
Dan
10:09 pm on Sunday, December 16, 2012
Ron, 49 states are in better shape when it comes to having funded thier pension liabilities. Of course we should join the other 43 states that impose state income tax on retirement income that enables them not to just create a mirage of being able make good on the promises made but they actual will have the cash to do it. The reason few were talking about the pension mess in the past is because it has become an increasingly larger problem as pension incomes have increased and our population has aged. Over the past few decades promises were made and than our elected official under taxed us to fullfill those promises. Those that currrently are retired should help make up for the underfunding they benefited from through taxes on their retirement income. Why should our kids pay for the underfunding of the generation before them. If a person working raising a family starting out at relatively low pay level can afford income taxes than the retired person blessed with a similar level of pension income should also be able to pitch in too.
Gerard Schilling
9:17 am on Sunday, December 16, 2012
If this was the Mafia these crooks would be prosecuted under the RICO laws? Instead they collude on a daily bases (both parties) on how to screw the tax paying citizens and reward themselves and families with crony jobs, free college tuition, ghost jobs, meaningless board jobs and commissions etc.,etc.
Danni
11:27 am on Saturday, January 12, 2013
I have been thinking they should be prosecuted under the Hobbs Act.
Devils Advocate
9:34 am on Sunday, December 16, 2012
It's so ironic how these politicians are attacking teachers, police, and fire pensions. They do nothing about the legislators pensions. They blame the public employee's who work and contribute to the pension system for the pension problem. Yet they are the ones who vote to not put in the money they are supposed to, and in some cases take money out of the funds. I say there needs to be term limits for every elected position. Besides the legislators pensions, the way they live like kings off of "campaign money" is a joke. Cars, food expenses, tickets to sporting events. Just look up IL Legislator Perks.
Pat Stiles
12:02 pm on Sunday, December 16, 2012
Police and Fire pensions are not under attack they have been excluded. In fact In Mich. who just passed right to work Legislation Excluded Police and Fire.
Arlo
7:59 am on Monday, December 17, 2012
Not true Devils. Get your facts straight and do your homework. A bill was called for a vote in the house during Veto to eliminate general assembly members pensions. It didn't get enough votes, but look to see who voted and how they voted. Very interesting who's good and who's bad!
Tony
9:42 am on Sunday, December 16, 2012
What needs to be done is e-mail this story to the Governors web site and then wait and see how he responds to it. The people in Illinois need to flood him with copies of this story and let him know we are wise to the way they fill their pockets with our tax money and it needs to stop now.I would like to know how much he is going to take with him when he leaves?
John
9:43 am on Sunday, December 16, 2012
I live in Kane County and I have 2 legislators that can/or will take multiple pensions.
Lauzen is not taking a second pension which not one other legislator has offered to do. Are the other local legislators that represent the county and retiring also not accepting their second or even third public pension?
I am writing a statewide letter today asking my local legislators Tim Schmitz and Karen McConnaughay to choose only one pension for themselves and to sponsor legislation now not allowing current and incoming legislators to collect multiple pensions.
No second pensions from this day forward. Patch should ask them to help by declaring no second pensions. It could be caleed the pick and choose legislation. And they should not write it or accept it unless every sitting legislator is done collecting two pensions!
Will they do this or will they take two pensions and do nothing? Will they take action today?
I expect my legislators Tim Schmitz and Karen McConnaughay to join Lauzen in not taking two public pensions and pass a bill now not to let anyone else take two either.
Sue Klinkhamer
2:52 pm on Sunday, December 16, 2012
Not paying into a second pension fund is NOT the same as taking your pension while getting a salary from your current job. I need some clarification:
Is Chris Lauzen going to collect his pension from the State AND take the salary from the citizens of Kane County?? That, though completely legal, is double dipping. Not contributing to a second pension funds for a future payout is really not the issue. It would seem that Lauzens income in 2013 will be his salary plus his pension plus his free healthcare paid by the State of IL taxpayers. And John knows this. BTW, legally he may HAVE to pay into the second pension fund.
Doremus Jessup
9:43 am on Sunday, December 16, 2012
Not trying to defend the size of the pensions here but would like some clarity on this statement:"An annuity with that kind of payout through the private sector would cost 10 times as much at $1.4 million, according to analysis by Jonathan Ingram at the Illinois Policy Institute,...
Does this take into account a matching employer contribution which would be common? If it doesn't take into account an employee match then I would say it reduces the amount needed in the private sector to 5 times as much instead of the stated 10 times. Also, if it is so unfair, why not get a law passed that taxes pension windfalls of these legislators? You can target these particular pensions without taxing every pension.
anonymous
10:10 am on Sunday, December 16, 2012
What do you expect from one of the most corrupt governments in the country!! The politicians are going to have to make reservations at the Federal Country clubs to assure they get a good location, but they will leave with plenty of money !!!
Scotty
10:15 am on Sunday, December 16, 2012
The best way to fix the corruption and waste in Illinois is to ban all political elected offices from getting a pension. That would help to end the carrer politician problem. We would not have the same lifers running and ruining this state year after year. Then good people would serve for a limited time then go back to their careers to earn their pensions. It was never intended by the founding fathers for people to make a lifetime career out of politics.
This state and this country is bankrupt because of people like Mike Madigan, Dicky Durbin, Pat Quinn and countless othersfrom both parties.
MM
4:09 am on Monday, December 17, 2012
Thank you Scott. And don't forget the republican candidates as well, they were corrupt in Illinois also.
Danni
11:45 am on Saturday, January 12, 2013
thumbs up scotty-except Quinn is not a real person-he is a robot made from feathers and string and madigan pulls the strings. Quinn makes simpering a new art form-didn't you just vomit at "Squeezy the Pension Python?" Was that supposed to be cute? Is that what this mess is-CUTE? Maybe for them-who think they will still get millions in pension $ from us. But not cute for us who are frantic about what they are going to try to do to us next.
Judy Brower
10:18 am on Sunday, December 16, 2012
I agree with Devil's Advocate. Our legislators retire with 100,000, 200,000 or even 300,000 PENSIONS after less than 10 years in office and they dare to attack the pensions of teachers, fire fighters, police etc.!!!!! These people work at least 35 years and contribute to their own pension, which the state borrows from! 52% of retired teachers in the state of Illinois make less than $50,00 a year and these greedy legislators want to take that away from them.
Pat Stiles
12:04 pm on Sunday, December 16, 2012
Once again Police and Fire are NOT under any attack. I have met with Leader Tom Cross, and Police and Fire are excluded from Reform
Scotty
12:31 pm on Sunday, December 16, 2012
The teachers contribute less than 10%. Thats a pretty sweet deal too. That said they deserve it more than the politicians.
Arlo
8:06 am on Monday, December 17, 2012
Judy, your facts are way off. I understand your anger and frustration, but your math is incredibly wrong. You shouldn't just throw numbers our that are completely false and expect to be a credible source. For 10 years of service, they may receive a $100,000.00 pension (The total collected over the remainder of their life, not the annual pension) if they live 30 years after they retire. Please be sensible with your comments and facts.
Jim Palermo
10:39 am on Sunday, December 16, 2012
Would you please show the math behind the estimated cost of these pensions?
Jealous taxpayer
11:33 am on Sunday, December 16, 2012
I don't know why legislators even have a pension. The job is part-time and for some it is no-time. Maybe we should treat them like school board members and park district commissioners who don't get a pension.
Jim Palermo
12:27 pm on Sunday, December 16, 2012
Just because police and fire pensions are not currently being discussed by the GA doesn't mean that they will not be discussed in the not too distant future. Local governments have their own financial difficulties which can only be resolved with pension reform.
Jim Court
1:12 pm on Sunday, December 16, 2012
Social groups
Fraternities
Gangs
Colors
Loyalty
Allegiance
In the line of duty
Symbols
Brotherhood
Danger
I read some of these descriptions in an article the other day. The commonality intrigued me.
G.Ryan
1:24 pm on Sunday, December 16, 2012
Let's get it on the ballot and vote for term limits and no more pensions for the gangster politicians. I bet Blago will get his pension. Folks, these politicians are the new mafia. Is it also true that the US President gets 180,000 for life, House/Senate 174,000, Speaker 223,500 and the Majority/Minority leaders 193,400? If so, wake up America!
Marie
1:28 pm on Sunday, December 16, 2012
If the legislators choose not to explain their self-serving actions to their own constituents, maybe the Patch editors could do more than just report and actually interview them with specific follow-up questions and post the video on-line. Ask Cross, Kosel, Radogno, etc. what their pensions and benefits cost us now and what they will cost us and our children in the future, and what they have actually done to address the pension problem. They are not worth the money and benefits they are taking from us.
Martha Hanna
3:18 pm on Sunday, December 16, 2012
Great idea Marie, we here in Kane County can put them on the hot seat. The Geneva patch should interview all of our elected officials now! Before we attack teachers pensions let's attack politicans. Why do these elected officials get pensions for life, it needs to stop.
SonofJohn
4:58 pm on Sunday, December 16, 2012
Politicians will always take care of them selves, it is in their best interest. Tax the hell out of the citizens of Illinois to support big "public" unions and their pocketbooks and those of the politicians as well.
J rogers
5:00 pm on Sunday, December 16, 2012
The biggest crook in all of Illinois is outfit connected, Obama supporter Kirk Dillard who refused to investigate serious ethics violations under the Edgar administration because he could not stand up to the Cellinis. Now he is in Springfield pandering to illegals to give them drivers licenses--the ychould be deported. And Dillard is voting to increase pension of payrollers and appointees be and Janis Cellini put on the payroll.
John
5:06 pm on Sunday, December 16, 2012
Lauzen's ex opponent said...
Is Chris Lauzen going to collect his pension from the State AND take the salary from the citizens of Kane County?? That, though completely legal, is double dipping.
I don't know but maybe she can ask someone in her own very close family like circle? Do these politicians really think that their neighbors are so stupid?
Robert Enders
5:45 pm on Sunday, December 16, 2012
Government pension decisions need to taken out of their hands and given to a body of ordinary citizens. IL politicians seem to believe they have the approval to steal from their constituents to benefit themselves, whether it's back room deals (union heads getting 158K/year pensions from working one day...) to outright theft, Blagojevich is the recent poster child. Term limits and no pension would attract people who truly desire to serve only, and eventually return to private life.
Martha Hanna
6:15 pm on Sunday, December 16, 2012
How about you can only collect one pension if you serve in government. How many different pensions does Hastert collect. We keep having this same conversation and everything is the same. We the people need to get mad and demand action now. Forget all the other pension issues in Illinois, concentrate on elected officials in office right now. They all need to be put on the hot seat.
Fran Bram
6:47 pm on Sunday, December 16, 2012
Way to end it all, term limits of six years and pension for social security
CAROLE
7:22 pm on Sunday, December 16, 2012
Amen, Fran.
Jim Court
8:17 pm on Sunday, December 16, 2012
That should also apply to the Presidency.
Tim T
8:20 pm on Sunday, December 16, 2012
The voters of Illinois get exactly the government they deserve....and the bill to go along with it. Why do voters continue to elect, then re-elect, then again re-elect numerous times these people? Derrick Smith, The Jackson's, Blago, Ryan, Berrios, Madigan (X2) and the list and the beat go on..........
Greg Nelson
8:00 am on Monday, December 17, 2012
Chris has been in office since 1983 people, what part of he worked for the pension don't you understand? The system is in play voted by the Democrats and frankly if it is there he has every right to it! It is funny when you point fingers when the finger should point back at many. It cost to run even a local election and for many I included paid out of pocket and got very, very little from anyone. Yes when millions are spent to get a 100K job it does look crazy but that is the facts of elections today. Do we need reform, sure but the question who is going to write the reform. Oh wait the people in office the ones that control ILLINOIS and AMERICA today so what is the answer? I think maybe we should grade the pay on what they have done, so with that Chris should be getting more. Remember if you don't like it vote against and write, call and email to your leaders because if we don't hear it enough we can't change it or just figure --- they don't care!
ag
8:45 am on Monday, December 17, 2012
What were they doing for the 30 years Lauzen was contributing his 140K in contributions? I'm assuming they invested it and it earned a conservative historical rate of return in the neighborhood of 10%. Pretty dumb article to not take into account this information when drawing comparisons.
and instead look at flat numbers.
Fred Cregier
8:31 pm on Tuesday, December 18, 2012
"Ron", I am curious about your statement that "social security is not federally taxed until it is over 34K". If that is true, I have been ripped off by our federal government for years, paying taxes on my social security at all levels, and my total social gross social security income annually even today is well under 34K!
Can you explain how you got this information? Where does it say in our tax code that social security is not taxable federally until it is over 34K/
Boy, I hope you are right, but unfortunately either you are misinformed or I am misreading your statement in the blog above.
Fred Cregier
Tim
9:11 pm on Tuesday, December 18, 2012
Fred,
http://www.irs.gov/publications/p915/index.html
Income Thresholds Used in Social Security Taxation Formula for Individual Filers
-If you file as an individual and your combined income exceeds $34,000, then up to 85% of your Social Security benefits may be taxable.
Note, this does not mean you will be taxed at an 85% rate, it means that for every $1 in SS you collect, you can be subject to whatever tax rate you are in (based on your TOTAL income) for $0.85 of that amount.
I bet if were to list the REST of your income(i.e. combined income), I could tell you exactly why your paying tax on your SS income.
Granny Gruntz
11:27 am on Thursday, January 10, 2013
*The logic tends to elude me as to why "former Illinois governors" and/or or other elected officials should receive pensions, etc.,
*When they have been sentenced and jailed for corruption and are serving terms in prison - and NOT even in "hard time" prison facilities.
*Also - it is about time to establish "term limits"!
*Yes - I know they have been "elected"...
*Government needs to have "fresh blood" not the same-o, same-o
of politicians being in office as long as they can be wheeled in on
a gurney.
*Why should politicians continue to receive salaries
*when they are on "prolonged sick leave" and
*unable to attend and participate in legislative sessions for which
*they accepted as their sworn obligations
*when they swore on the Holy Bible when they accepted office?
*Stupid question!!!
*Those duly elected officials make sure they receive their "entitlements",
regardless, when they are first sworn in to their respective office.
*Again - the logic continues to elude me.
Granny Gruntz
Danni
11:30 am on Saturday, January 12, 2013
wish I knew you Granny-you are correct-the only answer is a revolt-a revolution-as they try to take away our guns and assets the doomsday clock is at 11:59.
BobL
4:27 pm on Sunday, January 27, 2013
A Governor, a teacher, any public official convicted of a felony related to their job loses their pension. Also those of you that are living on a public pension, as I am, you do know what you feel about the legislators is similar to what the general public feels about all of us.
dale evans
3:16 pm on Sunday, February 3, 2013
The Federal Govt is 'borrowing' from their OWN employees pension fund. The Beast is eating it's own tail.