An appeal to the Illinois Governor to change the pension system

 May 10, 2025

Dear Governor Pritzker, 

I am writing to urge you to support SB2/HB2711 Fair Retirement and Recruitment Act aimed at improving Tier 2 public pension benefits.   The bill includes aligning Tier One and Tier Two average salary calculations, retirement age and  implementing a 3% cost of living increase, legal compliance and workforce sustainability.  

Tier Two affects employees hired after January 1, 2011.   It has created inequities in retirement security and undermines the recruitment and retention of essential public employees.  This bill is a matter of fairness but it also has legal and fiscal importance.    

Tier Two was enacted to reduce long-term pension liabilities to curb the state’s growing retirement liabilities due to the pension not being fully funded.   Public service employees that are newer have disproportionately lower retirement benefits.   In many cases these benefits fall below the safe harbor standards exposing the state to potential penalties and litigation.   These disparities between Tier Two and Tier One are a threat to retention and on the job morale, especially  affecting workers in education, law enforcement and state agencies.   This has to be fixed; staffing challenges are abounding and will continue to increase without action.   

The Fair Retirement and Recruitment Act would adjust the final average salary and retirement age thresholds, provide actuarially responsible enhancements to bring Tier Two benefits closer to parity of Tier One benefactors.   Public service worker are the backbone of our state.   Supporting this reform is a valuable step toward restoring trust and fairness in the pension system. 

Your support of the public service employees across the state that ‘make Illinois happen’ everyday.   You have the power to protect all employees retirement without regard to when they began working and as a natural result continue to attract qualified professionals for state public service.   By backing this legislation, you signal your commitment to long-term fiscal responsibility and respect for the people who server our state 

Please support this legislation and work with the General Assembly to ensure its passage.  

Sincerely, 

[Student]

Your three arguments for why the Governor should support the Fair Retirement and Recruitment Act are:

1) fairness; Tier Two benefits are unfairly lower than Tier One benefits.

2) risk; Tier Two benefits do not meet safe harbor status to allow the state not to collect Social Security payroll taxes from state employees.  If successfully sued, the State of Illinois could owe the Social Security Administration retroactively 12.4% of every paycheck it has paid to a state employee under Tier Two going back to 2011, and owe interest and penalties on all these payments.  This would effectively bankrupt the state, and there may be people in the current federal administration who would love to bankrupt the state (and thus, destroy the governor's hopes of being a presidential or vice presidential candidate for the Democrats in 2028). 

3) recruitment of a good workforce; Tier Two benefits are so bad that many potential state employees will seek employment elsewhere to avoid taking a job with such terrible retirement conditions.

I think your line about “commitment to long-term fiscal responsibility” is a powerful point to make with this specific politician. 

I think you could point out how ridiculous it may be for some types of state workers to tell them that they cannot qualify to retire until they are 67 years-old. Should school teachers be in the classroom for 43 years?  Should laborers in the Department of Transportation be working on road crews for 45 years? Yes, some state workers may want to work into their late 60s or even into their 70s, but requiring this of all state workers is creating situations that are obviously ridiculous.  The lack of cost-of-living adjustments to pensions in Tier 2 also creates horrible situations, especially if inflation rises significantly for a few years as it did in 2021-2023. 

Your request that the governor support the legislation and work with the General Assembly is also important.  The Governor needs to be encouraged to be more vocal in his support of specific bills, and this is a bill that you want him to support.

It seems to me that with this politician, you could emphasize the point that pension obligations in Illinois would now allow us to increase benefits to state employees hired in 2011 and later without putting the state's financials in danger, whereas failing to do so leaves our state vulnerable to fatal lawsuits.

With this politician, I would never miss an opportunity to explain that we need more revenue, and I would add that our sales taxes are too high, and our income taxes are too low, so why not raise the income tax and eliminate the general sales tax in such a way that we get enough of an increase in revenue to pay for pension reform, take care of mass transit infrastructure in Chicago, adequately fund higher education and K-12 education, pay for improved mental health services, implement the state's plan to end poverty, and pay for the creation of affordable housing to end homelessness in the state. I actually had a conversation with J.B. before he was even officially a candidate (he came to a demonstration when Rauner was governor, and he gave me about four or five minutes of his time for a short discussion, in which I complained about the structural deficit in the state and the need for politicians to be honest and explain that they needed to raise more revenue to do what is necessary). 

Growing Old in America

 The baby boomers are growing older and starting to enter the Social Security age range. Social Security doesn’t pay enough to cover all living expenses. The costs of housing are rising, as well as the costs of everything else. Unfortunately, the pay is not increasing to meet the costs of living. As you age it becomes harder to do things for yourself and to maintain a household. This requires additional help which costs additional money. Ideally by the time you reach the age of eligibility to draw Social Security, you should have your home paid off. However, that is not the case for most Americans. Many of the boomer population that I know still owe tens of thousands on their mortgages or they rent or have lot rent. Lot rent on a trailer park has gone up, and is now the price of what rent for a one-bedroom apartment used to be. The costs associated with maintaining a mobile home are also high, and typically don’t qualify for any type of repair assistance through local home maintenance programs sometimes available to older adults. For those that own their homes and still owe a mortgage it’s nearly impossible to pay the mortgage on the wage of social security. If you add a job to supplement the income, it can cause you to make too much money, and rules and case managers will subsequently decrease your benefits. 

Medical costs are also obnoxious. As you grow older, more health issues come out, and you typically require more medications, more appointments, and more assistance. These are all costly, so insurance is important. There is a gap in coverage with Medicare, and the costs of Medigap coverage can be out of reach for many people. I know some people who, in lean months, must choose between paying a bill or eating or paying for their medications or paying the mortgage. It’s a tough situation without much room for any change. 

Many people who receive Social Security are considered “over income” for SNAP benefits., and if they do qualify, they don’t receive nearly enough to be able to make ends meet each month. Many of our senior citizens rely on the food pantry for assistance each month. Our food pantries are a great resource, but typically only help a limited number of times per month. There also aren’t usually many choices for someone who has health conditions that require a special diet. This leaves many of the aging population in a tough place. 

The government has a responsibility to provide for its citizens, especially to those who have worked most of their lives to help pay taxes, etc and are no longer physically able to. Our country needs to do something different to help fill these gaps. 

The Baby Boomers are about 60 to 78 years-old. Probably most have retired by now, but no doubt a sizable minority of them still haven’t started collecting their Social Security or Medicare benefits.  My generation is 44 to 59 years-old, but there aren’t very many of us. 

About 37% of the population 65 or older is still paying off a mortgage. 

I wonder why Congress and the White House aren’t trying to raise the payroll tax to 7% (14% including employer contributions) from the 6.2% (12.4%) people currently pay into Social Security. The trust fund is rapidly depleted each year as expenditures for benefits exceed payroll tax collections by hundreds of billions, and in less than ten years, when the Social Security Trust Fund is exhausted, we will suddenly need to choose between a much steeper increase in the withholding tax, a significant (a quarter to a third) drop in benefits paid out, or a sudden increase in the budget deficit to cover the gap that the trust fund has been covering. 

You mention that Social Security benefits are not very generous.  Yeah, I think average monthly benefits are about $1,800 these days.  So, for most retired workers, the Social Security benefits are giving them about 37% of what they had been earning before retirement (see this report). So, consider that for about 40 to 45 years workers (and their employers) are paying about 12.4% of their incomes into Social Security, and then for 15 to 25 years in retirement they are getting about 37% of their former income back. Also, 

Your essay got me thinking about the Baby Boomer generation.  The Census Bureau says they were born between the summers of 1946 and 1964. Curiously, those of us in Generation X (born between 1965 and 1980) do not include those born in late 1964.  So, what about people born in late 1964?  Are they neither Baby Boomers nor Generation X?   Also, what was the best song by Generation X? Was it “Kiss Me Deadly”? Or, more likely, “Your Generation”?  And, since Billy Idol, (the toxic singer frontman of Generation X) was born in 1955, and his song is clearly a response to “My Generation” by The Who, whose members were mostly born before 1946 and are thus members of “The Silent Generation” rather than Baby Boomers, then isn’t the band “Generation X” really a Boomer band and their rebellion against the rock’n’roll of the 1960s an attack on the Silent Generation rather than the Boomers?    Also, which band is better, “The Millennials” or “Generation X” or “Generation Y”? Generation Y seems to play emo metal.  Generation X was a punk band, or new-wave, or something close to those genres. The Millennials do lots of covers of classic rock. I guess the answer depends upon musical genre preferences.

Please Support the Older Americans Act

As individuals grow older they often become less and less independent and have to rely on family members, aids, or services to help them through day to day living. Losing independence and having to rely on others can be quite depressing for the elderly population. The Older Americans Act (OAA) is an amazing resource for the elderly population. The OAA funds programs and services that work to enable the elderly population to enjoy healthy productive and independent lives in their homes and communities (National Association of Social Workers issue brief about the Older Americans Act). Some examples of services offered through this program are family caregiver support, long-term care ombudsman, nutrition programs, transportation, and programs to prevent and address elder abuse, neglect and exploitation (NASW letter supporting the Older Americans Act). If these policies are easily accessible, the elderly population’s mental health and well-being will benefit from the services listed. These services and programs work to still give elderly individuals a sense of being independent and capable of things they believed they never would be able to be capable of achieving again upon “losing independence.”

Funding is crucial and for the OAA increasing funding is absolutely necessary. Increasing funding is necessary for a couple different reasons. One reason is changing demographics within the US Population and another reason is because of new challenges that will be endured.

Changing demographics relates to the US population as a whole aging and the baby boom generation aging. Proactive policies and approaches are essential to ensure that older adults thrive and remain engaged with their families communities, and the broader society. New challenges that will need addressed as longevity increases and the population ages are the need for housing, economic security, health care, transportation, advocacy, and additional support services (Richard J. Fiesta’s consensus recommendations, 2019). Funding through OAA is crucial to ensure that as the elderly population continues to grow the necessary resources can be provided to the elderly individuals in need.

A reaction to Social Security

This reaction essay by a student is a bit more didactic than other reactions, but it offers a young adult’s understanding of the old age pensions provided by Social Security. 

Social Security is a social policy that was established by Franklin Delano Roosevelt and the Social Security Act of 1935. Social Security is the common name for, “Old Age, Survivors and Disability Insurance”. Social Security is a social insurance program but is not considered “welfare”, as that is known as public assistance. [interesting way to define welfare.  Public Assistance programs listed by the Illinois Department of Human Services include: SNAP, public housing, unemployment benefits, Temporary Assistance to Needy Families (TANF), Medicaid, and Supplemental Social Security (SSI). However, in Illinois I would think General Assistance (cash grants given by townships to poor residents) would also count.]  Social insurance programs and public assistance programs are the two categories of support programs that make up American social welfare. Old Age, Survivors and Disability Insurance is a universal program, and all Americans can participate as their social right [provided they aren’t excluded because they work abroad or work for an employer that has them in another program that substitutes for Social Security, and provided they are “Americans” by the definition of the American government, which doesn’t consider persons who grew up here to be Americans unless they were born here or their parents were citizens when they were born.] Participation in social security isn’t based on your financial need, but rather eligibility. Funding for this program is provided by a payroll tax that both an employee and employer must pay. Benefits of this social insurance are adjusted when the cost of living goes up. Social Security has been an effective way to raise individuals above the poverty line for several years.

In order for a person to receive benefits from Social Security, they must have paid their payroll taxes while they were working for a minimum of 10 years. In terms of Social Security, that is a total of 40 quarters. If an individual has paid their taxes and meets the age requirement at the time of retirement, they will be covered by this insurance permanently. The amounts of benefits that will be received are based on how much money was paid into the program. That makes up the “Old Age” part of the social insurance program. To be eligible for the “Survivor's” benefits of Social Security, an individual must be a child under 18 years of age, a dependent widow/widower, or a dependent parent. If he/she is one of those individuals and the insured worker dies, they will receive Social Security benefits. Along with that, to receive benefits from the “Disability” part of Social Security, an individual must be 18 to 64 years of age and unable to work. He or she will have to prove that they are disabled and unable to participate in “gainful employment”. When a disabled person turns 65, they will continue to receive benefits under the “Old Age” sector of Social Security. 

I believe that Social Security is a great form of insurance for eligible individuals. There are many different benefits it provides to such eligible individuals. As mentioned earlier, it has consistently lifted many people 65 and over above the poverty line [Yeah, it lifts about 22 million elderly Americans out of poverty]. It is a source of income for individuals who are unable to work, and it provides benefits to deceased individual’s families. However, there are certain problems that go hand in hand with the benefits that exist within the program today. Some employees that have paid into Social Security for many years aren’t getting the benefits they deserve. Part of that has to do with the budget issue that has arisen in Illinois within the last couple of years. As with any social welfare program, there are also ways to abuse the program that cause many problems. For example, a person who is insured under Social Security will receive benefits at the age of retirement which is their American right. But if such an individual has a family and is in the process of getting a divorce when he/she dies, their spouse will continue to get the benefits on behalf of the children. Although this is something that can’t exactly be monitored or fixed, it is a problem that happens more often that people think. The children should have the right to those Social Security benefits, but they should be set aside until they are 18 years of age. At 18 years old, the child will then have the option to do choose what to do with the benefits received from their deceased parent, as they are of an age to make responsible decisions. That is just one of the issues that prevails in the Social Security program. 

Any social welfare program will prove to provide a number of benefits to a range of different people. But as with all the other programs, social welfare policies will also have a number of abusers and issues that are existent within that program. Social welfare programs should continue to serve Americans but could stand to change a little for the better.

This is the first time I ever heard anyone raising this issue of survivor benefits going to a surviving spouse even if the surviving spouse and deceased Social Security Beneficiary were in an uncompleted process of divorce.  I think one reason there are survivor benefits for spouses is that we assume sometimes one adult works in the formal labor market and pays payroll taxes to get Social Security benefits, while the other adult works informally to rear children and keep house for the one who is working.  So, the spouse benefits are a reward for the working spouse who work just wasn't in the formal labor market.  It seems to me that such a spouse would deserve the benefits even if they were about to divorce the person who had paid the payroll taxes into Social Security.  Those payroll taxes were paid by a "household" as much as they were paid by the individual who earned them.  And, the spouse who didn't earn income may have been supporting the partner who did earn income for many years, and all those years of support don't get erased if in the final years the two part from each other. If the surviving spouse is taking care of the children, and paying for their living expenses, then it seems to make sense that the survivor benefits would go to that spouse.  But, yes, a surviving spouse might waste the survivor benefits on an addiction to gambling or substances, instead of using the benefits to care for the children.  That could happen.  Children's individual savings accounts are a good policy idea that could be made part of Social Security.  I think all children ought to get some money at birth, and have money added to it for various achievements in their lives.  The Child Individual Savings Accounts could be used to purchase a home, purchase education, invest in a business, pay for health expenses, and pay for relocation or moving expenses.  As adults people could continue adding money to this account, and then it could be passed on to children or grandchildren.  I'd have such savings accounts run as a supplement to the existing OASDI functions of Social Security.

Social Security Survivor's Benefits

Here is an example of a student paper on a policy.

As Americans, we work hard to provide a life for our families. As soon as we enter the work force we pay taxes to help make our country better and to create a basic retirement plan for ourselves. Social Security is meant to be a guaranteed retirement program, so hard working Americans across the country can support themselves after they have earned the right to retire. But what happens if that person dies before retirement? Where does all that money go? In these unfortunate cases, Social Security can act as a sort of life insurance for the surviving spouse and children. Losing a husband or wife can be devastating enough, let alone having to worry about earning enough money to keep a roof over your head or food on the table. Social Security Survivor's Benefits make sure that the families of hard working Americans are supported even after their loved one has passed on. 

Social Security has been around since the 1930's as a response to the economic downturn and widespread poverty, especially among the elderly, as a result of the Great Depression. It acts as a federal entitlement program in the United States, where individuals who meet certain criteria are entitled by law to receive certain benefits. There have been several amendments to Social Security made, mostly in the 1960s and 70s. Social Security was designed to lower the overall poverty rate of post-retirement individuals and to help combat the effects of ageism in the work place. Older adults are often seen as senile, infantile, and useless and are therefore discriminated against when it comes to getting jobs. Without some source of income, many elderly individuals would not be able to care for themselves and meet basic needs. The theory is that a person pays into Social Security their entire life so that they can have a guaranteed retirement plan, which is especially helpful if their job doesn't offer one or they are intentionally laid off just before they hit retirement age. But this money from Social Security can also come in handy for disabled workers or families of the deceased. If a person dies before they retire or after they retire and still have Social Security benefits left, then the surviving spouse and/or children may receive some of the money that their loved one worked so hard for over the years. 

 If the deceased has worked long enough and contributed enough to Social Security, their surviving family may be entitled to some benefits. Some of these benefits include the spouse receiving a payment on a one-time basis, so long as the spouse was living with the deceased or was at least receiving certain benefits under the deceased. In the absence of a spouse, the child becomes eligible for the benefits (Social Security Administration, 2015, p. 5). There are monthly benefits available for certain members of the deceased's family; any widows or widowers who are 60 years or older, or age 50 if they are disabled, any surviving spouse who is caring for a child of the deceased who is under the age of 16 and disabled, unmarried children of the deceased who are under the age of 18 (19 years of age in certain circumstances), any child 18 years of age or older who was diagnosed with a disability before age 22, stepchildren, grandchildren, or adopted children in certain circumstances, any dependent parents of the deceased over the age of 62, and in special circumstances, divorced spouses (Social Security Administration, 2009, p. 1).

So what are the benefits that your family will receive if you pass on? According to the Social Security Administration in 2015, "How much your family can get from Social Security depends on your average lifetime earnings. The more you earned, the more their benefits will be" (p. 6). Once the death has been reported to the Social Security Administration, the process for receiving benefits can begin. A one-time payment of $255 can be paid to qualifying survivors, but the amount is dependent on how long the deceased worked and paid into the program (Social Security Administration, 2015, p. 6). The amount of the following payments is also determined by how long the deceased worked, and by the survivor's relationship to the deceased, but the maximum amount that can be paid is around 150-180% of the deceased's total benefits (Social Security Administration, 2015, p. 9). Surviving children, or spouses with children under the age of 16 will receive 75% of the deceased's benefits, while widows or widowers who are under retirement age generally receive somewhere between 71-99% (Social Security Administration, 2015, p. 9). The only group that receives the full amount of the deceased's benefits are widows or widowers who are at full retirement age at the time of their spouses death or at the time of application for Survivor's Benefits (Social Security Administration, 2015, p. 8). There are several resources available for an individual to check to see what benefits they would be leaving behind for their families. 

Social Security is a publicly funded program through the government. The funding comes from a mandatory tax on income, up to $118,500 (Office of Retirement and Disability Policy, 2015, p. 1). Fortunately, there has always been a surplus created by Social Security, so on its own it would provide all the funding necessary for the payment of benefits. Unfortunately, the government continues to borrow from this surplus instead of simply investing all of it into Treasury bonds. This lack of responsibility and long-sightedness could potentially lead to cutting of the program to fill the government budget deficit. 

 While the theory of Social Security may seem like a simple idea, the practical application is much more complicated. Social Security on the whole is meant to be a supplement to private retirement plans and personal savings. But in recent years, it has become more difficult for individuals to save money, especially with the decrease in companies offering private pensions or guaranteed retirement plans. And since Social Security benefits are only meant to be supplemental, they are often not enough to cover basic needs, particularly for families. Another aspect that can make receiving these benefits is the red tape surrounding the application process. The last thing anyone wants to do when a loved one has passed on is deal with filing an application through the government. To apply, survivors will need birth certificates, death certificates, Social Security cards, W-2 forms for the deceased, marriage certificates, and bank account numbers (Social Security Administration, 2015, pp. 7-8). And Social Security benefits alone are not able to sustain families above the poverty line. So if the deceased was the sole breadwinner for the family, the survivors then have to make do with a fraction of the income they previously had. However, if the surviving family is simply a spouse who also receives Social Security Benefits, they may be able to get by slightly easier with this supplemental benefit. 

All told, Social Security is a great supplemental retirement and life insurance program, but it is just that: supplemental. For the surviving spouses and children of the deceased, this supplemental income may not be enough to sustain them. Children particularly who may be in high school or going through college that have lost a source of income may now be solely reliant on a portion of their deceased parent's benefits. While the program is better than nothing, it should not be entirely relied upon by surviving loved ones as a practical life insurance program.

References

Office of Retirement and Disability Policy (2015). OASDI and SSI program rates & limits.Retrieved from http://www.ssa.gov/policy/docs/quickfacts/prog_highlights/RatesLimits2015.pdf

Social Security Administration (2009). How Social Security can help you when a family memberdies. Retrieved from http://www.ssa.gov/pubs/EN-05-10008.pdf

Social Security Administration (2015). Survivors Benefits. Retrieved from http://www.ssa.gov/ubs/EN-05-10084.pdf