Pension Pressure Builds on Non-Existent State Budget

The decision by the state's largest pension fund to lower the assumed rate of return on investments will cost Illinois taxpayers $421 million in the next fiscal year.

In a 10-0 vote, the Teachers' Retirement System on Friday approved decreasing its investment return assumption from 7.5 percent to 7.0 percent, despite warnings from Gov. Bruce Rauner that such a move would have a "devastating impact" on education and social services and could lead to higher taxes.

TRS, which serves a little more than 400,000 members, had $62.7 billion in unfunded pension liabilities and a funded ratio of 42 percent as of June 30, 2015.

The decision deals a major blow to Illinois' finances, which already are reeling from an unprecedented budget crisis...

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