"Illinois is Broke" group calls for state pension, health care reforms

Wednesday, September 29, 2010

MOLINE, Illinois - Illinois business leaders are calling to reform the state's pension and retiree health care costs. The group, Illinois is Broke, wants elected officials to reduce the state's mounting debt with no time to wait.

This ticking financial time bomb already hit close to home at Skills Incorporated in January. Illinois money troubles left 50 disabled clients without the help they need. A four-decade history disappeared at an auction.

"This is our problem," said Jim Farrell, retired chairman and CEO of Illinois Tool Works. "This is our lifetime."

Reasons why top executives like Farrell are fronting the group. It's a non-partisan call to action for budget reform linked to the state's pension and retiree health care system.

The group made its case before some 30 local firms at Deere & Company on Tuesday morning.

"In 10 years, it's estimated that all of those pension funds will be out of money," he said.

Farrell and others warn that Illinois is following a recipe for disaster. The state is spending $3 for every $2 it takes in. That's making it impossible for cities, businesses and residents to thrive.

Moline Mayor Don Welvaert knows about the impact. Moline now pays 44% of its payroll on police and fire pensions. That's up from 17% ten years ago.

"I think that we need to do something very soon in the line of pension reform, or we're not going to have any money to operate the city," he said.

While the ripple forces everything from the University of Illinois to social service agencies to wait for state payments, the group calls for reforms before an income tax hike. It's recommending raising the state's retirement age from 55 to 67 while reducing and capping benefits into the future.

"The time is coming right up to midnight where if we don't solve this in the next few years, it will be literally insolvable," Farrell concluded. "Our state will be in dire, dire stress."

For more information check out the group's website, www.illinoisisbroke.com.