Berrios Votes to Reform Pension System, Reduce Unfunded Liability

April 17th, 2013   

CHICAGO, IL – Taking steps to ensure solvency of the state pension system, State Rep. Maria A. “Toni” Berrios (D-Chicago) voted in favor of three major pension reform bills that will significantly reduce the roughly $100 billion in unfunded pension liabilities.

“These past few years I continuously expressed how critical it is for our state to get the pension system under control. The strain caused by the unfunded pension system has been seen throughout many sectors including education, senior services, and services for the disabled,” Berrios said. “I will continue to support sensible and comprehensive legislation.”

With Berrios’ support the House was able to pass HB 1165 this week, reforming the automatic pension increases for current state employees and retirees. This measure is intended to rein in on the out-of-control automatic pension annuity increases that all retirees were receiving each year. Instead, for pensions $25,000 and above, retirees will receive a flat annuity increase of $750 a year. For pensions less than $25,000, the increase will continue to be compounded by 3% annually until it reaches $750, where then it will continue thereafter with an increase of $750 per year. These changes are drastically different from the current system in which all retirees receive a compounded increase of 3% each year. The projected savings of this legislation alone is approximately $100 billion over the next 30 years.

These reforms apply to Teacher Retirement System (TRS), State University Retirement System (SURS), State Employees’ Retirement System (SERS), and the General Assembly Retirement System (GARS).

“I have always voted on legislation that would cut my own salary and benefits first before making any changes to state employees’ pay or benefits,” Berrios said. “These reforms will strengthen the pension system and to continue to provide for current and future retirees.”

For more information, please contact Rep. Berrios’ constituent service office at (773) 736-3939 or email at repberrios39@gmail.com.

###