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updated: 3/10/2014 12:01 PM

Naperville ends city council pension participation

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It's the end of the line for pension benefits for Naperville City Council members.

Members of the council last week deleted pensions from the list of benefits they receive and amended the city code to reflect the change. As of March 4, council members no longer are eligible to participate in the Illinois Municipal Retirement Fund.

The final vote was a formality, the only logical step after a majority of council members declared that fulfilling the duties of their office does not require them to work at least 1,000 hours a year -- the minimum to be pension-eligible.

Pensions for council members have been a hot-button issue in the city, with one member long pushing for an end to the practice, others saying he was doing so only as a campaign tactic while running for statewide office, and at least one member saying he just wanted the issue to go away so the city can focus on more pressing concerns.

Ultimately, the unanimous vote to end pension participation, made in the absence of members Judith Brodhead and Robert Fieseler, means members who have not completed the eight years necessary to become vested can file paperwork to recover the paycheck deductions they have contributed to the Illinois Municipal Retirement Fund, or IMRF. When those council members step down or lose an election, they will not collect monthly retirement checks.

Future council members cannot contribute to or receive benefits from IMRF because a resolution passed Tuesday says their position no longer requires enough work each year to be eligible.

The position of mayor, however, is separate and still qualifies to receive a pension.

Pensions: deleted

The end of city council pension participation has different ramifications for different members.

For those who are vested with at least eight years of service, options depend on age.

Anyone younger than 55, such as council member Grant Wehrli, who became vested in December, can choose to get a refund of pension contributions, said John Krupa, IMRF spokesman.

Anyone older than 55, such as council member Doug Krause, cannot receive a refund if his or her pension would be more than $30 a month.

The city estimates Krause's pension would be between $5,000 and $6,000 a year, or between $416 and $500 a month.

Krause, 66, said he has not received official documentation from IMRF about what his pension will be, but he does plan to apply to begin receiving the benefit.

"I'll start getting (my pension) right now because I'm not employed by an employer that recognizes it," said Krause, who has been on the council for 25 years. "It won't prevent me from getting the pension I earned."

The vote to end pension participation completed a goal for Wehrli, who is running for state representative in the 41st District. Wehrli long has said he wanted to find a way out of the pension he "regrettably" signed up for when he joined the council and to remove the benefit entirely.

"It's good policy that we no longer get pensions," Wehrli said. "It's just not right to receive an annuity on what taxpayers have to pay."

The end of pensions for council members stands to save the city about $11,000 a year, City Manager Doug Krieger said -- money it otherwise would have spent making employer contributions to IMRF on council members' behalf.

Political timing?

Council members discussed the possibility of declaring their positions ineligible for pensions in December during talks about salaries for members elected in spring 2015, but Wehrli was the only one to support the change.

The topic came up again when IMRF began an audit in February. Krupa said IMRF aims to audit 20 percent of membership records a year. Each of the past five years it has audited between 100 and 150 of its 3,000 municipal employers and, last month, it was Naperville's turn.

Krieger said IMRF did not provide any information about the timing of its first audit of Naperville since 2007, and Krupa said the employers audited each year are selected at random.

But Krause says the only reason pension participation has received so much scrutiny in Naperville is Wehrli is running for state representative and "making this a campaign issue."

Wehrli said he has talked recently with IMRF, but he did not ask for an audit. He said any connections others make between his thoughts on pensions and the recent audit are "conspiracy theories."

Ending benefits

During the audit, each council member was asked to sign an affidavit certifying it requires at least 1,000 hours a year to fulfill the duties of the position. That amount of time is the required minimum to remain eligible for an IMRF pension.

Krieger said only two signed the forms: Krause and Brodhead.

Several who did not sign the forms nonetheless said they put in that much time or more. Between time spent at meetings, reading memos to keep abreast of city business and representing the city at business or charity functions, Steve Chirico, Paul Hinterlong and Joseph McElroy said they are confident they work at least 1,000 hours a year, which breaks down to roughly 20 hours a week.

But because less than a majority of members certified that the position demands the required hours, the audit recommended the city declare in writing that council members are not eligible for pensions.

Krause on Tuesday night moved to delay a vote on the measure, saying he wanted all his peers to be present and on the record. But others said they had spoken with the two absent members, Brodhead and Fieseler, who urged them to move forward.

The vote to end participation in IMRF was unanimous and effective immediately.

For McElroy, the vote to end pensions was a way to make a "bogus, trivial issue" go away for good so the city can focus on more pressing financial concerns, such as a $14 million deficit in the budget of the city-owned electric utility.

"The best thing for the city at this point is to put a stake in the heart of this issue," he said during Tuesday's meeting, "so we can move on with the rest of running the city."

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