CHICAGO —Today, Mayor Brandon Johnson announced the City of Chicago has completed its $260 million Advanced Supplemental Pension payment for Fiscal Year 2026, fulfilling this commitment for the fourth consecutive year and bringing the total amount of supplemental pension contributions made by the City to nearly $1.1 billion since 2023.
“For decades, administrations before ours kicked the can down the road on funding our pension system, abandoning our obligation to our hardworking public servants and putting Chicago in greater financial risk,” said Mayor Brandon Johnson. “My administration made a commitment to ending those irresponsible practices and has continued making supplemental pension payments year after year, without relying on one-time federal dollars.
Today’s announcement of more than a billion dollars in supplemental pension payments proves we are making good on that promise.”
The City’s nearly $1.1 billion in supplemental pension contributions have been made in addition to its statutorily required annual pension payments.
These additional contributions are designed to reduce the long-term costs associated with decades of unfunded pension liabilities while safeguarding the retirements of hardworking City laborers, municipal employees, firefighters, and police officers who have honorably served the City.
The supplemental payments made by the Johnson administration are not supported by an infusion of one-time federal funding.
Instead, the administration has continued making these additional contributions alongside the City’s required annual pension payments through its smart and responsible stewardship of public dollars, prioritizing long-term fiscal stability and the retirement security of public servants.
The City’s supplemental pension payment policy is also an important component of its plan to improve Chicago’s long-term fiscal outlook.
In a recent report on Chicago, S&P Global Ratings cited the City’s continued advance supplemental pension payments as an important credit strength.
In February 2026, another ratings agency, KBRA, noted the City’s fourth consecutive supplemental pension contribution as an important step towards long-term stability.
“The City’s demonstrated commitment to making the pension advance payment is a critical step in addressing the compounding effects of legacy pension costs and strengthening the City’s long-term fiscal health,” said Chief Financial Officer Ashlee Gabrysch. “Committing over a billion dollars in supplemental contributions is a notable milestone and demonstrates the Johnson administration’s resolve to confronting Chicago’s financial challenges head-on.”
In June, the City published comprehensive data on its pension funds for 2025.
From 2024 to 2025, each of the City’s four pension funds achieved increases in their funding levels.
The aggregate funded ratio of the four funds, on a fair-value basis, increased from 25.63% to 28.15%, reflecting continued improvement, supported in part by strong investment performance.
In the 2027 Budget forecast, the City is budgeting for an additional $364 million in supplemental pension payments.
The 2027 Budget forecast also showed a marked decrease in the projected deficit, down nearly $284 million from 2025.
Despite rising costs and considerable revenue losses from key elements of the City Council’s Alternate Budget failing to materialize, the FY2027 Budget Forecast anticipates a budget deficit of $882.4 million, down from an estimated nearly $1.2 billion in the FY2026 Forecast.
The budget gap reduction is driven by the overperformance of local revenues, especially the progressive, structural revenues introduced by the Johnson administration, such as Online Sports Wagering and the Personal Property Lease Tax, as well as the City’s careful control of expenditures through cost-savings strategies implemented across City departments, monetization of City assets, and dedication to doing more with the resources available.
The Johnson Administration is committed to strengthening the City’s financial foundation through thoughtful budgeting, transparent financial reporting, and continued investments that expand opportunity and improve the lives of all Chicagoans.
Addressing the City’s financial challenges requires fiscal discipline and a sustained investment in the people and communities that make Chicago strong.
For more information about the City’s pension outlook, see the FY2027 Budget Forecast, availablehere.