Illinois Motorists Feel the Pension Squeeze, Too
ITASCA - The Illinois Road and Transportation Builders Association (IRTBA) urges Springfield to act on fixing the public pension crisis. The current unfunded liability has a serious negative impact on investing in public infrastructure. This liability has lead Moody's Investors Service to list Illinois as the lowest-rated state, which leads to higher costs to borrow funds for needed transportation improvements. Dollars that could go to repairing bridges, fixing potholes, and improving transit go instead to pay for unnecessarily high interest rates - ultimately costing the taxpayers more money.
"Bonds funded the major multi-modal transportation improvements undertaken over the past few years. The future of such significant projects throughout the State of Illinois will be severely curtailed if the state does not get a handle on the pension crisis," said Jennifer Krug McNaughton, IRTBA chairman of the board.
The pension crisis also has a direct effect on the state's Road Fund. The Road Fund is the state's source of revenue to pay for highways, bridges, and roads. The Illinois Department of Transportation (IDOT), like all state agencies, must contend with pension shortfalls. The Road Fund pays for the valuable IDOT workforce, including their pension payments. IDOT has made significant cuts to their workforce to compensate for the budget cuts. Despite this, pension obligations are a looming threat to the Road Fund. Catching up for past pension shortchanges has caused an increase in these payments from $38.5 million in FY 2003 to $130 million in FY 2012. According to IDOT, that figure is expected to explode to $395 million in 2018.
"Considering the size of the current annual highway construction program is less than $2 billion , pension payments will take a massive cut out of worthy projects throughout Illinois," said IRTBA President & CEO Michael Sturino.
Each day that pension reform is not passed, the long-term pension deficit increases by $17.1 million. Each year, the pension system "squeezes" the State budget by another billion dollars. According to the Federal Highway Administration, every billion dollars spent on infrastructure creates over 32,000 jobs.
"The pension squeeze not only causes a further deterioration on the state's transportation system, it prevents putting people back to work," Krug McNaughton said.
The IRTBA encourages Illinois residents to find out more at "This is My Illinois: Thanks in Advance" at www.ThisIsMyIllinois.com. An engaged citizenry is needed to confront this issue once and for all - and to protect Illinois' infrastructure and jobs.
"We encourage the motoring public of Illinois to act now and express the need for a solution to this costly shortfall," Krug McNaughton said.
To contact your legislator, a legislator lookup can be found on the Illinois General Assembly website at www.ilga.gov.
About Illinois Road and Transportation Builders Association
The Illinois Road & Transportation Builders Association (IRTBA) was formed in 1938 to promote the transportation needs of the state and is now the largest statewide organization of companies designing, building and maintaining the state highways, transit systems, railways and aviation systems. The core purpose of IRTBA's existence is: "to protect, improve & promote the transportation design & construction industry in Illinois."
