Senator Rutherford voted against legislation that will allow Illinois to skip more than $2 billion in pension payments over the next two years. Governor Blagojevich introduced the measure to fill the state’s $1 billion budget hole, despite warnings from pension authorities who caution that looting the pension system—which is already $35 billion in debt and ranked as worst funded in the nation—will only serve to increase the deficit. “Skipping pension payments is a quick-fix that will allow the current Administration to escape from the responsibilities of implementing true reform,” said Rutherford .  “This legislation will allow the state to forgo payments to the Illinois pension systems for two years—incurring interest and billions of dollars in debt that future taxpayers and administrations will still be paying off decades from now.”

Springfield – The General Assembly recently approved legislation which will push Illinois ’ severely under-funded pension systems further into debt and burden future generations with massive financial obligations, said State Senator Dan Rutherford (R-Pontiac).

Senator Rutherford explained that the decision to skip payments would violate the 1995 pension funding law enacted under former Governor Jim Edgar’s administration, which established a fifty year funding plan to meet pension liabilities. Currently, under the law, Illinois owes $2,613.1 billion to the pension systems.

“Every dollar Illinois avoids paying right now will add $13 to the state’s future pension costs, effectively burdening future taxpayers with up to $26 billion to finance the pension system,” explained Rutherford . “In essence, what Governor Edgar fixed in 1995, Governor Blagojevich is breaking in 2005.”

“The Governor is touting this legislation as ‘reform,” but I refuse to support any type of reform that balances the budget on the back of Illinois downstate and suburban teachers, and burdens future generations of Illinois taxpayers with billions of dollars in debt.”