STUMP » Articles » Illinois Quickie: Pension Benefit Growth Rates » 7 June 2018, 17:52

Where Stu & MP spout off about everything.

Illinois Quickie: Pension Benefit Growth Rates  


7 June 2018, 17:52

Rather than paste this onto the Illinois post from earlier today, I’m giving this its own post.

How have pension benefits grown (in terms of cash flows) in Illinois?

First, there are 8 Illinois-based pension funds in the Public Plans Database. One of them, Chicago Municipal, has too little available data, so I will ignore them. But I will keep the other 7.

Using that data, and comparing against other pension plans in the system, I get that 4 of those 7 plans are in the top 20 public pensions in the U.S. for average benefit growth rate (over 2001-2015).

Interestingly, they aren’t really on tops with total benefit growth, primarily because they don’t have as high a growth rate in # of beneficiaries as do the D.C. plans, for instance.

So there’s all sorts of wacky stuff going on out there — I can believe high # of beneficiaries growth rate, because the peak Boomer birth years were 1957/1958… so they’re about 60/61 right now. That’s full retirement age for many public plans.

The average benefit amount growing rapidly… that’s not good for long-term solvency.

And finally — the total benefit growing ginormously… well, if you’ve put enough money by…but most of these aren’t terribly well-funded plans to begin with.


By the way, if you’d like to know where Wisconsin ranked:

  • 108 out of 121 for Average benefit growth rate
  • 61 out of 121 for Number of beneficiaries growth rate
  • 102 out of 121 for Total benefit growth rate

So yes, they are relatively keeping growth of benefits muted.


And who is dead last for each of these rankings?

Average benefit growth rate: TN State and Teachers had a negative growth rate – Detroit Police and Fire was close behind, both at -0.7% per year, which led to about 10% decrease in the 14-year period for both

Number of beneficiaries: LA Water and Power — also has a negative growth rate. -0.6% per year.

Total benefit growth rate: Detroit Police and Fire — you may have heard there was a bankruptcy, and their total benefit growth rate from 2001 to 2015 was 0.

So this is just one snapshot – Detroit Police and Fire can remind one that public pensions have been cut. That was a federal bankruptcy process.

So perhaps that’s what’s in store for Chicago and Cook County. We’ll see.

Underlying spreadsheet here.

Related Posts
Asset Grab Bag: Whistleblower Award for Blogger, Private Equity Fees and Returns, and more
Houston and Dallas Pension Bills Signed: Now What?
Connecticut Pensions: Pushing Off Payments Til Later Ain't Reform