The race is on to lock in current retirement packages before they can be altered, reduced or eliminated by state legislatures. For Illinois, that race to retirement has become a rush for the exits.
In the past 12 months ending June 30, there were 4,750 state government employees who retired, a figure that represents almost as many total retirees for the previous 24 months ending July 1, 2011.
At state universities in Illinois, almost as many retirees – 4,647 – left their jobs during the same period ending June 30, 2012, and that is an increase of 1,300 retirees from the previous 12-month period.
"That's just a big number," acknowledged Timothy Blair, executive director of the State Employees' Retirement System, told the Chicago Tribune. "A lot of it has to do with the unknowns of what's going to happen."
The reasons for the mad dash are obvious. Government pensions are coming under increased scrutiny as legislatures are running out of money and looking to cut funding obligations wherever they can. When pensions are examined for fat to cut, the first place the knife will cut is usually to future pension beneficiaries. Generally speaking, current and former retirees are spared the knife.
In 1970, retirements benefits were actually written into the state constitution, protecting such benefits from being reduced once they had been achieved. Many current and new retirees in Illinois feel this protects them from facing any cuts to benefits once they have retired.
Yet that may not be the case for much longer. Many legislatures are looking at any and every way they can legally cut costs, to include pension obligations. State workers retiring now are hoping that retirement deals in place at the time of retirement will not be touched.
Though retirees in Illinois feel safe, legislators are looking to see if the guaranteed-pension benefits protected by the state constitution can be legally altered in anyway, to include making retirees pay for more of their own health care costs.
Ten years ago, then-Governor George Ryan wanted to lure as many workers off the rolls as possible, so his office helped create lucrative packages to help entice state workers to take an early retirement. That deal prompted more than 11,000 workers to voluntarily leave.
Right now, those benefits remain intact. They may or may not be safe, however, since the state is facing a $93 billion pension deficit by summer 2013.