PEORIA -- The state of Illinois is bankrupt and many communities across the state need to be allowed to declare bankruptcy, themselves.
The problem is pensions, said Jim Tobin, president of Chicago-based Taxpayers United of America. "Most people have no idea that over 19,000 government retirees are receiving pensions over $100,000 a year," he said, speaking in Peoria on Tuesday.
"You're going to have to use all the property taxes to pay pensions, then you don't have money to pay police and fire, the services we need now. The pension system has bankrupted the state of Illinois," said Tobin.
Peoria City Manager Patrick Urich has said that the city could face a $6 million shortfall in its 2019 budget, citing rising pension costs as one of the biggest expenses. Urich warned members of the Peoria City Council last month that reductions in the city's fire and police departments could be necessary unless new revenue streams are found.
Tobin calls for Illinois to reform its pension system "before it collapses."
"There's no way to tax ourselves out of this mess. The higher the taxes, the more people leave Illinois. We've lead the country four years in a row in outmigration," said Tobin, adding that Peoria has also seen its population decline for four consecutive years.
"The pension data speaks for itself. The average Peoria taxpayer's Social Security pension is about $17,000 and is funded completely with private money from taxpayers and their employers," he said.
"It's ridiculous that taxpayers have to work into their 70s and 80s to fund generous government employees, many of whom start collecting pensions in their 50s," said Tobin, pointing out that many state pensions increase by 3 percent per year.
Tobin, who toured the city releasing the names of government retirees receiving the largest pensions, provided lists of those who held government posts or teaching jobs in the Peoria area with the largest pensions.
He pointed to two employees of the Peoria public school system with annual pensions over $200,000 each: Francis Hilton II, $211,087, and Annette Smith, $201,663.
"Illinois Central College retiree, Thomas Thomas (former ICC president), tops our Peoria pensions at $218,517 this year," said Tobin.
Topping the list of a group that Tobin referred to as "pension millionaires" was Leslie Heffez, a Chicago-area retiree whose current pension is $598,664. A complete list of Illinois pensions can be found at www.taxpayersunited.org.
Tobin suggested a series of moves to reform the Illinois system. "First, stop hiring government employees with new pensions. Switch new hires over to 401(k) plans. I've been recommending this for 10 years," he said.
"Next, the General Assembly needs to allow local governments to declare bankruptcy, allowing those communities to reorganize their finances," said Tobin, adding that Washington needs to allow states like Illinois to declare bankruptcy.
"We also need a constitutional amendment to allow local governments to cut pensions," said Tobin, who said the November election might bring more bad news for Illinois taxpayers.
"If J.B. Pritzker gets elected (governor), he and Illinois tyrant Mike Madigan will see to it that these lavish pensions are continued. They bring in thousands of union and government employee votes," he said.
On the campaign trail, Gov. Rauner has talked of a bill to allow municipal bankruptcy while Pritzker has addressed of paying off some of the state's pension debt through his graduated income tax idea but as yet hasn't provided details of the plan.