URBANA, Ill. (AP) -- A group of University of Illinois professors have a plan to reform the retirement system for university employees.
In a proposal issued Monday by the Institute of Government and Public Affairs, the professors recommend letting workers trade a portion of their guaranteed benefits for a lump-sum payment. That payment would go into a self-managed retirement account.
Professor Jeffrey Brown says many employees would choose the lump sum to diversify their retirement funds.
The report says offering the lump sum payments would help cut Illinois' $96 billion unfunded pension liability.
It also recommends ending the tax exemption on retirement income, and warns that shifting the full cost of pensions to universities could lead to tuition increases.
Lawmakers have said they want to pass pension reform by Jan. 9.