Rep. McDermed Refuses State Pension, Health Insurance Benefits

Vowing to lead by example, State Representative Margo McDermed today announced that she will refuse state pension and health insurance benefits offered to members of the General Assembly. McDermed (R-Frankfort) stressed that previous administrations have left Illinois with one of the worst funded state pension systems in the nation – a problem that can’t be fixed by adding to the burden.

“When you’re in a hole, the first thing you need to do is stop digging. As a new member of the House, I am choosing to refuse General Assembly pension and health insurance benefits that would, in effect, dig our state deeper in debt,” McDermed said.

Currently, legislators who participate in the pension program contribute 11.5 percent of their annual salary to the General Assembly Retirement System (GARS). A legislator’s base annual salary is $67,836. Members with committee chairmanships and/or leadership positions earn more.

Under pension reform legislation enacted in 2010 that applies to new members who have entered the General Assembly since 2011, legislators can retire at age 67 with a minimum of eight years of service (or at age 62 with reduced benefits) and earn up to 60 percent of their final average salary after 20 years of service. Legislators who took office prior to 2011 remain eligible to retire at age 62 with a minimum four years of service (or age 55 with a minimum eight years of service) and earn the maximum 85 percent of their final average salary after 20 years, with annual cost-of-living adjustments.

“I know refusing these benefits won’t single-handedly solve our pension and budget crises, but it’s an important first step to show that I am ready to lead by example as we work toward solutions,” McDermed said.

Representative McDermed’s decision is final and irrevocable; as administrative rules within the state pension system do not allow her to ever opt back in.

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