CHICAGO — A day after Illinois lawmakers approved legislation overhauling two of Chicago's pension funds, Cook County President Toni Preckwinkle said she will unveil her own plan to shore up the county's troubled pension fund.
Preckwinkle said Wednesday that she wants a reform plan to be introduced to the General Assembly within a month. Without reform, Preckwinkle warned, the county could face another downgrade.
"We're in the same position as the city, in that if we don't get action on our pension problems, we're looking at downgrades," Preckwinkle told reporters after a county board meeting Wednesday. "We've escaped the draconian downgrades that the city has suffered, but we were downgraded last summer and we were told by the rating agencies if we don't get some pension reform done this session, we'll be facing additional downgrades."
Moody's Investors Service rates Cook County A1 and Fitch Ratings has an AA-minus rating. Standard & Poor's rates it AA. Both Fitch and Moody's maintain a negative outlook on the county, chiefly due to the underfunded pension obligations.
The Cook County Employees' Retirement Fund's unfunded obligation grew to nearly $6.8 billion from $5.83 billion while its funded ratio dropped to 54% from 57% in fiscal 2012. That includes retire health care liabilities.
The Cook County Forest Preserve Employee Retirement Fund's unfunded obligations total $132 million, with a funded ratio of 57%.
Preckwinkle did not offer details of the plan, and did not rule out the possibility of a tax increase.
"We're looking at all the options," she said. "We've been fairly creative over the last four years in finding revenue sources and looking at ways to run the government more efficiently," said the president, who took over the long-troubled government of the nation's second most populous county in 2010.
The Chicago Tribune reported that the plan would boost employee contributions by 2 percentage points and that future retirees would receive lower cost-of-living increases than current retirees. Preckwinkle would raise the retirement age by five years, the Tribune said.