* As of June 30, 2018, the General Assembly Retirement System had an unfunded liability of 85.16 percent. It had 132 “Active Contributing Members” and 302 retirement annuitants and another 115 survivors drawing benefits. Add in stuff like this and you can easily see why GARS is in such trouble. From the Center Square…
[Retiring Senate President John Cullerton’s] starting annual pension will be nearly $83,000, which is 85% of his final salary of roughly $97,600 a year. For most state retirees, the next year of retirement would come with a 3% automatic pension increase, bringing Cullerton’s pension to $85,500 a year.
But in July 2021, Cullerton will see his pension checks explode to nearly $128,000 a year, a 54% increase.
How? For each year he served at the Statehouse since 2003, when he turned 55 years old, Cullerton received an extra 3% increase to his eventual pension payment. After retirement, all of those increases are then applied to Cullerton’s pension as part of his first cost-of-living adjustment.
Should Cullerton retire in mid-January, he will have collected 3% increases for 17 years, good for a 51% pension boost. That will stack on top of his automatic first-year adjustment of 3%, coming to a total pension hike of 54%, according to his pension fund’s response to Freedom of Information Act requests. After that, he will continue to see a 3% bump each year.
This little-known benefit comes from a 1989 bill sponsored by former state Sen. Emil Jones Jr., which allows lawmakers who were elected prior to 2003 to hoard pension “spikes.” Cullerton, who was House Speaker Mike Madigan’s floor leader in the House at the time, was a member of the committee that finalized the bill. It passed both chambers with bipartisan support.
“(F)or those members of the General Assembly right now who … have maxed out … they are still contributing to that retirement system,” Jones told his colleagues at the time, according to the Chicago Tribune. “So all this does is give them a little 3% on their own money.” He was referring to lawmakers who had already maxed out their pension at 85% of their salary.
The same bill established a 3% automatic cost of living adjustment for all retired state workers and Chicago city workers. This benefit alone doubles a retiree’s pension in just 25 years. Even without the special sweetener provision, the 3% automatic benefit increases would bump Cullerton’s annual pension to more than $120,000 by the time he turns 85.