CHICAGO (WBBM NEWSRADIO) — Chicago's pension burden climbed dramatically in 2022, after the City's retirement funds lost money due to what Mayor Brandon Johnson’s Administration described as “volatile markets.”
According to Chicago's annual financial report, the net pension burden from the City's four retirement funds rose a little more than 5% — from $33.7 billion to nearly $35.5 billion — as of December 31st.
The report adds, Chicago's four funds range from nearly 19% funded to about 40% funded.
That’s far short of other municipal plans. Around the U.S., funding ratios for the largest public pensions average above 70%.
Johnson, who took office in May 2023, set up a pension working group in June. That group will be charged with finding what he called "sustainable solutions" to the long-term challenge.
Shortly after Johnson announced the working group's formation, Northwest Side Ald. Gilbert Villegas (36th) said he wants to sit down with officials from the City's four employee pension funds. Villegas added that he'd like to suggest more investment in local development projects.
"[It] would get projects finally going; [it] would allow for jobs to be created...again, tax revenue being created," he explained. "Those are things that we want to continue to see going on. We need that positive activity to occur."
Bloomberg reported that decades of chronic underfunding helped balloon Chicago’s pension liability, which in turn have weighed on the city’s budget and credit ratings.
The full financial report can be found here.
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