Cook County Treasurer Maria Pappas was astonished by the amount of local government debt that Chicago-area households hold, according to a report released by her office on Tuesday.
The average debt per household in Chicago is over $63,000, based on municipal shortfalls and underfunded pension obligations. In the suburbs, the average is just under $33,000.
“We knew that debt and unfunded pension obligations were serious problems at the state and federal level and assumed that a similar pattern would follow at the local level. But, quite frankly, I was stunned by the depth of the crisis for local governments,” Pappas said in the statement. “This goes well beyond big cities, where you expect financial challenges. These fiscal problems permeate townships, villages, school districts, park districts, fire protection districts and more, and the taxpayers are on the hook.”
Local governments in Cook County hold a total of $108 billion in debt and unfunded pensions, according to the report. The latter term refers to the projected difference between the value of the governments' pension assets -- what workers will pay in, and the interest on that money -- and what the agencies will owe to retirees.
The Chicago Board of Education is one of the biggest holders of unfunded pension liability, totaling over $4 billion in unfunded pensions. The city of Chicago itself has just shy of $12 billion of the same.
All told, municipal bodies in Cook County have around $25 billion in unfunded pension liability, just under a quarter of the total debt in the area.
There is a fine irony in Pappas crying foul over heavy burdens placed on taxpayer dollars: earlier this year, she was the subject of a Better Government Association investigation indicating that she spent $94,000 a year in taxpayer dollars employing a driver and another $57,000 on a cleaning lady.
Meanwhile, restructuring the pension system in the city of Chicago is expected to be a task laid at the feet of mayor Rahm Emanuel in the coming months, one that will pit him and other budget hawks against unions of public-sector employees who feel vilified by his administration in the fiscal conversation.