BGA Policy’s Pensions Hub

Pensions Hub

Welcome to BGA Policy’s Pensions Hub! We will update this page frequently with all the information you need on Illinois’ pension problems and the proposed solutions. 

On this page you’ll find: links to the various plans proposed by the Governor, the Center for Tax and Budget Accountability and the Civic Committee of the Commercial Club of Chicago, a breakdown of those very plans in a five-part opinion series for the Chicago Tribune by BGA President David Greising, and regularly updated tracker for pension legislation in Springfield.

10 Principles of Pension Reform

The following 10 principles were first presented in the Chicago Tribune by president of the Civic Committee of the Commercial Club of Chicago, Derek Douglas, president of the Civic Federation, Joe Ferguson and president of the Better Government Association, David Greising. They represent the ideals that any responsible pension legislation should adhere to.

1. Achieve and maintain 100% funding. 

Place the Illinois retirement systems on a path to 100% actuarially determined funding by 2055 or sooner, ensuring the long-term stability of the system and its ability to meet future obligations.

2. Improve Illinois’ credit rating.

Prioritize actions that lead to an upgrade to an AA credit rating for the state of Illinois within a five-year time frame, restoring investor confidence and reducing borrowing costs for the state.

3. Maximize long-term savings.

Prioritize accelerated pension funding that results in substantial long-term savings compared with the projected costs of inaction, which would free up money to go to important public services. These measures should ensure the most fiscally responsible approach to addressing pension liabilities, with a bias toward immediate implementation.

4. Ensure and protect dedicated funding.

Require that any new revenues raised specifically for pension reform are directed to a legally defined and protected “lockbox.” This would prevent the diversion of funds to other purposes and ensure transparency and accountability with strict enforcement mechanisms. Any future pension benefit increase must be funded annually from a separate, dedicated revenue source.

5. Eliminate the pension funding cliff.

Provide for a gradual reduction of pension funding over a long-term period to achieve 100% funding levels by 2055 or sooner without having a pension funding cliff, such as the one that exists in 2046 under current law.

6. Responsibly address the Tier 2 salary cap issue.

Implement a fiscally responsible solution to ensure changes to the Tier 2 benefit plan are limited to measures needed to meet Internal Revenue Service safe harbor requirements while preserving the overall structure of the Tier 2 plan. 

7. Prioritize intergenerational equity.

Fairly distribute the costs and benefits of any reforms across current retirees, active employees and future generations, avoiding disproportionate burdens on any single group while safeguarding existing retirement benefits.  

8. Promote transparency and predictability.

Employ realistic actuarial assumptions based on nationally recognized standards during consideration and implementation of any pension law. Ensure transparent annual reporting of pension liabilities and funding progress.

9. Policy proposals should focus on pension solutions.

The legislative process requires the consideration of various points of view and negotiation. Given the importance of solving the state’s pension issues, policy proposals unrelated to pensions should be kept to a minimum and align with these principles.  

10. Promote economic growth and jobs.

Implementation of pension policies should create a more attractive environment for job creation and the economic welfare of the people of Illinois.

Pension Plans

Below are three of the most talked about plans to address Illinois’ pension problems. They vary in how they achieve solvency, where they pull resources from and how they address Tier 2 — a lower set of benefits offered to state employees who began work on or after January 1, 2011. For a breakdown of these plans you can check out the five-part opinion series BGA President David Greising wrote for the Chicago Tribune. See here.

Governor Pritzker’s
Plan

Civic Committee of the Commercial Club of Chicago

Center For Tax and
Budget Accountability

BGA In Action

BGA Pension Puzzle

On October 15, BGA President David Greising led a discussion with four pension leaders: Deputy Governor for Budget and Economy Andy Manar, Senator Robert Martwick, Representative Stephanie Kifowit, and Representative Steve Reick, to discuss how to fix Illinois’ pension system.

After a brief recap of how Illinois found itself in this mess from Greising, the four panelists took turns offering various, and sometimes contradictory, paths forward. A diverse array of topics were covered, from how Illinois’ pension problems impact employment, how to address the Tier 2 IRS “Safe Harbor” requirements and even some mention of Chicago’s pensions.

During the discussion all four public officials on the panel endorsed the 10 Principles.

YouTube video

Pension Solutions:
How Illinois can address its biggest financial challenge

BGA President David Greising wrote a landmark five-part pension series for the Chicago Tribune. The series covers Illinois’ current pension problems, reforms by other states, an analysis of some of the current plans on how to address Illinois’ problems and how Illinois can move forward to end its pension woes for good.

The tribune series initiated a civic discussion and ultimately led the BGA, Civic Federation and Civic Committee to draft the 10 Principles of Pension Reform.

Part 1: The challenge to erase Illinois’ $140 billion in pension debt

Part 2: What Illinois can learn from other states’ pension reforms

Part 3: Examining the plans to tackle Illinois’ pension debt

Part 4: Without political support, Illinois can’t move forward on pension fix

Part 5: How Illinois can finally gain traction in solving its pension crisis

Pension Legislation

Below is our Pension Legislation Tracker, which is regularly updated by our BGA Policy team. If you’d like to follow along with how Springfield plans on addressing pensions you can subscribe to our email to get regular updates.



Pensions Working Group

On March 6, 2025 Illinois House Speaker Emanuel “Chris” Welch announced the creation of the Pensions Working Group. In the announcement he said the new group “will bring stakeholders together to discuss ways to provide competitive and sustainable retirement benefits for teachers, nurses, public safety workers and others who serve our communities.”

The members of the group are: