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IPFS News Link • Pensions

Illinois Governor Furious After Pension Fund Cuts Returns Forecast...

• http://www.zerohedge.com, by Tyler Durden

Earlier this week, we reported of an daunting predicament facing the dramatically underfunded Illinois Teachers Retirement System (TRS), the state's largest pension fund which is only 41.5% funded: cut its existing future returns assumption from 7.5% to 7.0% (which was previously lowered from 8.0% in 2014) and suffer the wrath of the state's governor Bruce Rauner, who would be forced to implement even more unpopular tax hikes, or keep its existing projected returns, and potentially suffer an even greater shortfall - and greater taxpayer funding needs - over the long-run if it was unable to hit its bogey.

Despite tremendous political pressure, on Friday afternoon, the Board of Trustees for the Illinois Teachers' Retirement System, which serves almost 400,000 teachers, voted to cut the assumed rate of return to 7% from 7.5%. "We have to do what we believe is the right thing," Richard Ingram, the pension's executive director, said during the board meeting in Springfield.


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