How to reform police, fire pensions

If you've been forced to cut back family finances, you know the dilemma: Something's gotta go, but no one agrees on what.

The debate easily can become acrimonious, with everyone pushing his own interests.

So it goes with the latest public spending problem: fire and police pensions.

It's not the most flashy topic but should have our full attention, thanks to recent reports like these:

• East Dundee estimates its entire property tax income will go to police pensions within the next three to five years, raising the specter of higher sales taxes, property taxes or even income taxes to pay for village services.

• Arlington Heights paid $2.4 million over the last five years to cover the costs of three recent state laws increasing fire and police pension benefits, according to the Illinois Commission on Government Forecasting and Accountability.

Many Illinois towns are pushing for change, saying there's not enough money to pay for benefit levels approved by the state. Yet, police and firefighters understandably argue against talk of reducing pensions for workers in dangerous jobs who are part of the fabric of our communities.

The debate reached a standoff in May, complicated by the involvement of a state legislature that makes police and fire pension rules but doesn't pay the freight. A bill that would have reduced pension benefits for newly hired police officers and firefighters died because of an 11th-hour provision that would have given trustees of underfunded police and fire pensions first dibs on any funds distributed to that town by the state.

We believe the issue can be resolved, but it will take respect, fairness and cooperation among municipal, union and legislative representatives.

One starting point is reining in pensions for future fire and police officers, similar to provisions put in place for teachers and other public employees in April. It's reasonable to raise the retirement age, now as early as 50, though we recognize workers in these strenuous jobs shouldn't be required to continue into their 60s. Also, it's only common sense to figure cost-of-living increases based on actual inflation, rather than a standard 3 percent increase per year, and to calculate pensions based on an average of the eight highest-paid years rather than on the final day's salary.

Separate local pension funds also might have run their course. Merging them into larger funds seems certain to increase investment yields and decrease administrative costs.

And it's crucial that legislators calculate all the costs before considering any future expansions of pension benefits.

Finally, towns favor changing the state-imposed 2033 deadline for fully funding the pensions. We recognize the irony of legislators imposing a deadline for others while failing to meet the state's own pension obligations, yet pushing back the date only compounds the problem.

The goal should be pension levels that are fair and that taxpayers reasonably can finance, not more debt we pass on to our kids.