Chicago under-funded
their government employee pensions. They should terminate their defined benefit
pension plans and transfer balances to a 401K plan. Instead, they are raising
taxes to cover the shortfall.
Truth
in Accounting awards Chicago 'F' grade,By Chriss Street, 7/12/19, American
Thinker.
The city’s shortfall between the end of 2017 and 2018 increased by $2,100, or
6.8 percent. With the annual rate of inflation at 2.4 percent last year, Chicago resident’s debt
to pay for the benefits of retired public employees jump almost three times
faster.
The City of Chicago continued to lead the nation in one 2018 category with a
net 156 more residents leaving the city each day than moving to the city, up
from about 100 in 2014. New York was second with loss 132 a day, followed by
Los Angeles with 128.
The
nonpartisan ‘Truth in Accounting’ (TIA) think-tank awarded the city of Chicago a
transparency “F” grade for failing to disclose that each resident now owes
$38,100.
TIA
for almost two decades has rapidly produced detailed forensic accounting
analysis of municipal, state and federal government fiscal health. Although
Illinois state law requires the city of Chicago to publish its audited
financial statement within six months of the end of the fiscal year for public
review, TIA reported that Chicago for the fourth year in a row failed to timely comply with its
June 30th mandated deadline.
But
on July 5, 2019, the 2018 fiscal year Comprehensive Annual
Financial Report (CAFR)
appeared on the city’s website with a letter of transmittal backdated to June
28, 2019. TIA found the CAFR data revealed the Chicago at the end of 2018
owed a net $34.4 billion, the majority is attributed to a $31.1 billion
unfunded public pension plan and about $685 million in unfunded retiree health
care.
TIA
cautions that the total Chicago taxpayer’s debt burden would be much higher,
but Chicago Public Schools and the Chicago Transit Authority are separate from
the city.
With
Chicago and the suburban fringe of liberal Cook County comprising 5.2 million
residents, or 41 percent of Illinois’ 12.7 million population, Illinois has the
highest combined state and local tax burdens of all 50 states and Washington,
D.C., according to a report by the WalletHub personal finance service site. The
“Land of Lincoln” effective state and local tax rate in a household earning the
median U.S. income is 14.9 percent, or about $8,653, and +38.5 percent
higher than the national average.
TIA
founder and CEO Sheila Weinberg summarized TIA’s verdict on transparency: “We found that
Chicago’s leaders have failed to address the structural problems weakening its
financial system, instead plugging the holes with short-term fixes. When the
bills come due, Chicago politicians are going to face a lose-lose dilemma:
reduce services and benefits or fix the problem on the backs of future
taxpayers."
Bottom
line: Chicago would need $38,100 from each of its taxpayers to pay all of its
bills, so it has received an “F” for its finances from Truth in Accounting.
According to Truth in Accounting’s grading scale, any government with a
Taxpayer Burden greater than $20,000 receives an “F."
Chicago
politicians did not disclose the CAFR’s dreary numbers until after the Illinois
state politicians passed a budget on June 6 to borrow another $20.6 billion and slap on another 21 new taxes that will cost every man, woman,
and child another $370 a year to supposedly repair “bridges and roads and
highways” that are “falling apart.”
But
the Illinois Policy Center
estimates that
the $40.6 billion operating
budget is out of
balance by as much as $1.3 billion, with at least $1.4 billion of “pork
projects” that fund dog parks, snowmobile paths, pickleball courts, school
playgrounds, swimming pools, and arts grants to rehabilitate a vacant theater.
Norb Leahy, Dunwoody
GA Tea Party Leader
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