Illinois state rep. Skip Saviano lost his re-election bid last month, so his 20 years of work in the state legislature is soon coming to an end. But that doesn't mean Illinois taxpayers can stop sending him checks.
The retiring Republican contributed $146,000 towards his legislative pension during his two decades of service. Using the current Illinois pension fund's formula for retiring legislators and the Social Security Administration's life expectancy data, Saviano is likely to receive $2.5 million in his golden years, according to Scott Reeder of Illinois Watchdog.
"That's a far better deal than he could get in the private sector," Reeder said in a report today. "In fact, the $146,000 he contributed toward his retirement is a real bargain. If he wanted to buy an annuity in the private sector with the same anticipated payout as his public pension, it would cost him $1.7 million."
Saviano was one of 34 retiring state legislators studied by Reeder as part of his ongoing coverage of public pension costs in Illinois. He collected the necessary data on the lame-duck solons via the Illinois Freedom of Information Act.
Illinois is one of the nation's most indebted states, thanks largely to an extraordinarily generous public employee pension system. The system currrently has an unfunded liability - that is, benefits it has promised to pay but has yet to fund with necessary investments - that will exceed $200 billion in 2013.
Cardozo School of Law's Prof. Edward Zelinski, a nationally recognized pension authority, told Reeder the generous Illinois program is "offensive" because it amounts to a form of covert compensation.
"I can't say it is the most egregious in the nation, but I can say it is hard to believe there are many - or any - that are more egregious," he said.
"If a lawmaker announced that he was going to double his salary, the voters would be outraged and would vote him out of office."
But since there is little public understanding about the costs of most public employee pension systems, voters aren't likely to take action against those who benefit directly from the deferred benefits.
Even so, public awareness is growing of the financial dangers posed by public employee pensions like the Illinois retirement, thanks to news accounts of California cities going bankrupt because they can no longer afford to pay their retired government workers the benefits they were promised.
"This just offends me," Zelinski told Reeder. "People elect these individuals thinking they are going to make a modest salary and do the public good. In reality, they are doubling their salaries by increasing pensions. This isn't a Republican or Democratic issue. There is room for bipartisan outrage here."
For more from Reeder's report, go here.