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Case Competition: Tough Choices for the Illinois Pension System

Case Competition: Tough Choices for the Illinois Pension System. Georgia Institute of Technology. Ben Staver Matthew Pjecha Shelley Stewart Loren Crawford . The Issue. Over 60% of teacher pensions in Illinois are unfunded Inadequate contribute to pensions Risky investments

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Case Competition: Tough Choices for the Illinois Pension System

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  1. Case Competition: Tough Choices for the Illinois Pension System Georgia Institute of Technology Ben Staver Matthew Pjecha Shelley Stewart Loren Crawford

  2. The Issue • Over 60% of teacher pensions in Illinois are unfunded • Inadequate contribute to pensions • Risky investments • Loose accounting practices

  3. Proposal: • Two-pronged approach • Short-term • Long-term • Values of Proposal • Transparency • Sustainability • Solidarity and fairness

  4. Short Term • Income tax increase • Aimed at funding the deficit • 1.25% income tax increase • 1% corporate tax increase • Informing the Public • Optional Pension Plan Introduced

  5. Long Term • Reformed Pension Scheme • Union-based Power Check

  6. Reformed Pension • Increased contribution to 11% • Redefined benefits • Increase retirement age to 65 • Reinstatement of 6% penalty • Opt-in Structure • Five-year Review by Third Party

  7. Union-based Power Check • Means of checks and balances • Initiate collective bargaining process to check government contributions • Measures up to and including strike

  8. Closing Remarks and Questions Thank you for your time!

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