Tag: The News-Gazette

Guest Commentary | Politicians’ next pension ‘fix’: Gambling with your money

Mary Pat Campbell

Link: https://www.news-gazette.com/opinion/guest-commentary/guest-commentary-politicians-next-pension-fix-gambling-with-your-money/article_7865780f-7ed8-5c1e-8cc5-1ee4e43ca3cb.html#new_tab

Excerpt:

Gambling on the stock market to get out of financial troubles. It’s a fool’s game, but that’s exactly what some politicians in Illinois are considering now to address their cities’ growing pension crises. Lawmakers want to borrow money from the bond market to pay down pension debts by issuing what are known as pension-obligation bonds.

The borrowing scheme is a bit more complicated than the household example, but in essence, pension-obligation bonds are all about taking out a loan, then investing that money and hoping the returns beat out the costs of the loan.

It’s a lose-lose game for taxpayers. If politicians get it right, governments will have extra money to spend and grow even bigger. And if politicians get the bets wrong, they’ll come after taxpayers to pay off their gambling losses.

That’s one of the reasons why national organizations like the Government Finance Officers Association say “state and local governments should not issue POBs.”

Author(s): Ted Dabrowski and John Klingner

Publication Date: 12 September 2021

Publication Site: The News-Gazette

Jim Dey | After a year, Teachers’ Retirement System’s dirty laundry put on display

Mary Pat Campbell

Link: https://www.news-gazette.com/opinion/columns/jim-dey-after-a-year-teachers-retirement-systems-dirty-laundry-put-on-display/article_f9668f4b-1a9f-512f-b2b4-e04a58b7b08d.html#new_tab

Excerpt:

There was a personnel earthquake in the summer of 2020 at the Teachers’ Retirement System in Springfield.

Ultimately, five high-ranking employees were removed from their positions, including executive director Richard Ingram. The tumult generated clouds of uncertainly that only recently started to clear, revealing improper and possibly criminal behavior.

Although mum at first, TRS officials recently released their first lengthy statement about what occurred, disclosing that a new employee purposely maintained a conflict of interest that he falsely claimed to have ended.

…..

The OEIG report states the scandal dates back to 2018, when the TRS “began the process of constructing a new pension system that it called the Gemini Project.” Urbanek said the Gemini system recently went online.

That required hiring outside information technology professionals. Singh and his company — Singh 3 Consulting — were initially hired as a contractor. But in 2019, the TRS hired Singh as a permanent employee, the hiring predicated on Singh terminating his relationship with his company.

He told the TRS he had done so. But no one apparently ever checked, because subsequent investigations revealed Singh remained president and chief executive officer.

Author(s): Jim Dey

Publication Date: 12 September 2021

Publication Site: The News-Gazette

Editorial | When it comes to Illinois bond ratings, up definitely better than down

Mary Pat Campbell

Link: https://www.news-gazette.com/opinion/editorials/editorial-when-it-comes-to-illinois-bond-ratings-up-definitely-better-than-down/article_d17d487c-5ff3-5da1-a958-60d7edd5c3e6.html

Excerpt:

Citing a “material improvement in state finances,” Moody’s Investor Services recently raised the state’s bond rating by one notch — up to Baa2 from Baa3.

Ordinary mortals won’t know what that means. But Illinois has climbed the ladder from being one notch above junk bond status to two notches.

It’s the first time Illinois’ bond rating has been raised in 20 years. The improvement comes after a steady spiral downward.

Author(s): Editorial Board

Publication Date: 4 July 2021

Publication Site: The News-Gazette

Editorial | Legislative lunacy

Mary Pat Campbell

Link: https://www.news-gazette.com/opinion/editorials/editorial-legislative-lunacy/article_967b0ad5-3d2e-544a-b7ae-83f75d384af4.html

Excerpt:

When it comes to politics and government, Chicago is a force unto itself. Its strengths and weaknesses are, mostly, of its own making.

But the city was recently victimized by the General Assembly, and it’s important for the people of Illinois to know why. What happened speaks to a serious problem — a Legislature seemingly untethered to reality.

…..

Unfortunately, state legislators voted during the recent lame-duck session to increase retirement benefits for 2,200 Chicago firefighters.

Mayor Lori Lightfoot, as a newspaper headline put it, objected “strenuously” to the Legislature’s action.

She correctly described it as a “massive unfunded mandate to the taxpayers of Chicago at a time when there are no funds to cover this new obligation.”

Publication Date: 22 January 2021

Publication Site: The News-Gazette