The Illinois legislature overwhelmingly passed a full year budget Thursday. It includes a few plans to cut down on the state’s massive pension debt.
One of the ideas would let retired workers cash out in one big payday. Another idea is to offer an incentive to get retirees to significantly cut their 3% annual raises.
Those proposals come in part from State Representative Mark Batinick. The Plainfield Republican helped introduce a buyout program that would give retirees the option to take 60% of their lifetime pension in one lump sum, rather than continue getting regular payments with interest.
“You’re more likely to use your money in your 60s than maybe in your 90s," Batinick reasoned. "Maybe that’s when you wanna buy a motorhome, or you wanna travel or do whatever, or you wanna pay for your kid’s college.”
Batinick says the majority of people he's talked to about the plan are in favor of it. He explained it's all about giving retirees choices.
“You’re really locked in a box with your retirement savings," he said. This allows people in the pension system to kind of expand their options, and by giving them options, the state can save money at the same time, so it’s really a win-win.”
While courts have found past alterations to state pensions unconstitutional, Batinick says his plan is legal because it’s voluntary. Now that state lawmakers gave it the ok as part of the full budget, it goes to Governor Bruce Rauner, who issued a statement suggesting he’ll sign it.