Tag: Justin Carlson

TAXPAYER PENSION COSTS EXCEEDED ILLINOIS PROJECTIONS BY $13.7 BILLION SINCE 2013

Mary Pat Campbell

Link: https://www.illinoispolicy.org/taxpayer-pension-costs-exceeded-illinois-projections-by-13-7-billion-since-2013/

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Unrealistic assumptions and missed investment returns have meant Illinois taxpayers paid $13.7 billion more for public pensions than state leaders projected five years earlier. Unless the estimates improve, taxpayers will pay an extra $21.3 billion during the next decade.

Illinois does a particularly poor job of figuring out how much money is needed to pay its public pensions: The past decade has seen the projections miss by 16%, which meant taxpayers needed to give $13.7 billion more than was estimated.

Author(s): Justin Carlson

Publication Date: 17 Jun 2022

Publication Site: Illinois Policy Institute

CHICAGO’S $43,100 DEBT PER TAXPAYER DRIVEN BY PENSION DEBT

Mary Pat Campbell

Link:https://www.illinoispolicy.org/chicagos-43100-debt-per-taxpayer-driven-by-pension-debt/

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Chicago once again earned a failing grade from Truth in Accounting in their latest Financial State of the Citiesreport thanks to over $38 billion in debt – $43,100 for each taxpayer.

Every Chicagoan would have to send the city that amount just for Chicago to pay the bills it owes. Chicago has just $9.9 billion available to pay $48.6 billion in bills. The Windy City came in 74th out of 75 cities studied in the report, only besting New York City’s massive $204 billion debt with a per-taxpayer burden of $71,400.

The city’s financial failings stem from pension promises the city cannot afford to keep. “Chicago’s financial problems stem mostly from unfunded retirement obligations that have accumulated over the years. The city had set aside only 23 cents for every dollar of promised pension benefits and no money for promised retiree health care benefits,” the report notes.

Author(s):Justin Carlson

Publication Date: 8 Feb 2022

Publication Site: Illinois Policy Institute

ILLINOIS SPENT 6% MORE THAN IT TOOK IN FOR 15 YEARS, SO COVID-19 HIT IT HARDER

Mary Pat Campbell

Link: https://www.illinoispolicy.org/illinois-spent-6-more-than-it-took-in-for-15-years-so-covid-19-hit-it-harder/

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From 2005-2019, Illinois revenues totaled just 94% of expenses. The state ran deficits in each of the 15 years prior to the COVID-19 pandemic. Only New Jersey overspent more.

Illinois was one of only eight states to see spending outpace its revenues from 2005-2019, leaving it fiscally ill-prepared to deal with the tumultuous COVID-19 pandemic, according to new data from The Pew Charitable Trusts.

Illinois ranked No. 2 for overspending.

According to the report, Illinois took in just 94.1% of the revenues it needed to cover its expenses from 2005-2019. That number was second worst in the nation, coming in just ahead of similarly troubled New Jersey.

Author(s): Justin Carlson

Publication Date: 12 Jan 2022

Publication Site: Illinois Policy Institute

ILLINOIS IS ONE OF FEW STATES WITH ‘DEATH TAX.’ BILL WOULD DOUBLE IT.

Mary Pat Campbell

Link: https://www.illinoispolicy.org/illinois-is-one-of-few-states-with-death-tax-bill-would-double-it/

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Many states have moved away from taxing assets after people die because of the harm to family businesses and farms, but a new proposal before state lawmakers would double Illinois’ estate tax.

House Bill 3920 would hike the existing state tax on estates of over $4 million to 9.95% from 4.95%. Unlike neighboring Wisconsin, Michigan, Indiana and Missouri, Illinois is one of just a dozen states that still have an estate or inheritance tax. Tax Foundation analyst Katherine Loughead noted, “The top marginal estate tax rate under this proposal would become the highest in the country at 21%.”

While the bill’s sponsors intend the extra revenues to be used to support Illinoisans with disabilities, hiking the estate tax would squeeze family farmers, reduce the accumulation of productive assets, encourage spendthrift behavior, fuel tax avoidance and evasion, and drive wealth to other states.

Author(s): Justin Carlson

Publication Date: 16 March 2021

Publication Site: Illinois Policy Institute

WEAK ACCOUNTING STANDARDS ENABLE ILLINOIS BUDGET DEFICITS

Mary Pat Campbell

Link: https://www.illinoispolicy.org/weak-accounting-standards-enable-illinois-budget-deficits/

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Bad accounting has helped Illinois politicians avoid balancing the budget for 20 years, despite a constitutional requirement to pass a balanced budget each year. Government accounting standards that fail to offer transparency and accuracy in financial reporting have also contributed to the state’s $260 billion pension crisis, the primary reason Illinois has the lowest credit rating any state has ever received.

The Governmental Accounting Standards Board has proposed changes it calls “improvements” to the accounting standards for governments. However, watchdog groups such as Truth in Accounting have criticized the proposed changes and urged the adoption of more stringent standards that would require governments to balance their budgets the way most businesses are required to do. Illinois has grown accustomed to using lax accounting methods to hide its budget deficits, racking up debt year after year. The state’s taxpayers would benefit from tougher standards that impose fiscal discipline.

Author(s): Justin Carlson

Publication Date: 19 February 2021

Publication Site: Illinois Policy Institute

WEAK ACCOUNTING STANDARDS ENABLE ILLINOIS BUDGET DEFICITS

Mary Pat Campbell

Link: https://www.illinoispolicy.org/weak-accounting-standards-enable-illinois-budget-deficits/

Excerpt:

Bad accounting has helped Illinois politicians avoid balancing the budget for 20 years, despite a constitutional requirement to pass a balanced budget each year. Government accounting standards that fail to offer transparency and accuracy in financial reporting have also contributed to the state’s $260 billion pension crisis, the primary reason Illinois has the lowest credit rating any state has ever received.

The Governmental Accounting Standards Board has proposed changes it calls “improvements” to the accounting standards for governments. However, watchdog groups such as Truth in Accounting have criticized the proposed changes and urged the adoption of more stringent standards that would require governments to balance their budgets the way most businesses are required to do. Illinois has grown accustomed to using lax accounting methods to hide its budget deficits, racking up debt year after year. The state’s taxpayers would benefit from tougher standards that impose fiscal discipline.

Author(s): Justin Carlson

Publication Date: 19 February 2021

Publication Site: Illinois Policy Institute

CHICAGO HAD $41,100 IN DEBT PER TAXPAYER BEFORE COVID-19, SECOND TO NEW YORK

Mary Pat Campbell

Link: https://www.illinoispolicy.org/chicago-had-41100-in-debt-per-taxpayer-before-covid-19-second-to-new-york/

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A new report from government finance watchdog Truth in Accounting gave the Windy City an “F” for financial health. Chicago’s massive $36 billion net debt stems primarily from pensions.

Chicago city taxpayers were just hit with $94 million in property tax increases and $38 million in higher fines and fees, including a policy for speed cameras to ticket drivers for going just 6 mph over the speed limit, to help close the city’s budget deficit. City leaders placed much of the blame on COVID-19’s impact on government revenues, but a recent report from fiscal watchdog Truth in Accounting shows Chicago’s problems existed long before the pandemic.

Author(s): Justin Carlson

Publication Date: 11 February 2021

Publication Site: Illinois Policy Institute