Illinois' University Pension Fund Is Underfunded by $20 Billion
The publicly funded university pension system in the state of Illinois is in such bad shape that it is in the red to the tune of $20 billion dollars.
The situation is a danger to the state's colleges. "Each passing day without pension reform threatens the excellence of higher education at the 65 colleges & universities" in Illinois, says the Institute of Government and Public Affairs at the University of Illinois.
A recent investigation by government watchdog OpenTheBooks.com reveals some of the more outrageous examples of out of control pensions noting that one school official is making $27,000 a month off the backs of the taxpayer.
Vernon O. Crawley of Moraine Valley Community College, Open The Books says, had a salary of $673,000 during his final year vs. a $260,000 inflation adjusted final salary. But upon retirement his pension is a whopping $330,000 per year which figures to $27,000 a month.
"With no skin-in-the-game, colleges are conferring excessive salaries and slamming taxpayers for the pension costs. Colleges pay zero in pension funding costs. Employees pay in 8% of salary. State taxpayers are on the hook for the rest.," the group says.
Open the Books also points out that since 2012 the number of college employees has exploded. College enrollment is only up eight percent, but the number of school employees has gone up an unsustainable 80 percent.
"Illinois colleges and universities employed 52,000 in 2002. By 2012, total employment has risen to 90,000. This is unsustainable," the watchdog group says.
The university system pension isn't the only pension crisis in the Land of Lincoln. Illinois has some 638 different public employee unions and many are drowning in red ink.
As the Washington Free Beacon noted in October, Illinois pays almost 5,000 teachers a six-figure salary. But the median household income of those who pay the bills in the state is only $56,576 a year.
The Beacon points out that the state has the worst funding ratio of any pension system in the country with debt estimates ranging from $100 billion to nearly $300 billion. The average family of four would have to pay from $300,000 to more than $880,000 to close this gap.