Illinois Still Has Serious Fiscal Problems After December 2013 Pension Law Changes

Illinois has a chronic, structural fiscal problem so huge that it cannot be eliminated by increases in economic growth alone, increases in taxes alone, or—alas— aggressive pension changes alone.1 In early December 2013 the General Assembly passed, and Governor Quinn quickly signed, a major pension reduction bill. In this brief, we project Illinois’ budget gap with estimates of the fiscal impact of the new pension law. The state still has a large structural imbalance after the pension changes.