The potential solutions:
1. Graduated income taxes versus their current flat tax.
2. Allowing more time to get to 90% funding -- shifting the target from 2045 to 2052.
3. Selling state assets.
Illinois needs to figure a way to deal with their pension obligations and this is just the latest plan to do so. Around a year ago, the state was considering borrowing $107 billion.
What about these new solutions?
Tax increases: via Moody's has already warned the state that increasing taxes could lead to citizens leaving the state.
Shifting the target date: that just seems like kicking the can down the road a few years.
Selling state asses: There are REITs that specifically deal with government properties so this one isn't unusual.
It seems like the first two solutions could result in poor outcomes while the third seems like something that is already being done by other government entities.
No comments:
Post a Comment