Report claims Cook governments' debt at $108 billion
A report from Cook County Treasurer Maria Pappas claims taxpayers countywide are on the hook for more than $108 billion in debt accrued by various government agencies, including more than $25 billion in unfunded public pension liabilities.
The report shows that only a quarter of the county's more than 500 taxing bodies are funding pension plans at 80 percent or more, an amount considered "healthy" by federal standards.
"It's like if I were surgeon general, I'd say that 75 percent of our governments are morbidly obese," Pappas said. "I don't think there's any one cure for the debt problem, just like I don't think there's one cure for obesity."
But shortly after the report was released Tuesday morning, a number of officials from a variety of taxing bodies disputed some of the treasurer's data. The disputes had little to do with the amount of indebtedness, but rather the percentage the governments were reportedly funding pension programs.
For instance, Pappas reported Buffalo Grove's pension fund was nearly 1000 percent below federal standards. But Buffalo Grove Village Manager Dane Bragg said a misunderstanding over what figures were supposed to be reported to Pappas' office led to the error. He said the village has since sent corrected figures to Pappas to fix the problem. The new numbers show Buffalo Grove's pension funding at 61 percent, still below federal standards.
Since this is the first year the county's 553 local taxing agencies -- which includes municipalities, park districts, libraries, school districts, townships and other taxing districts -- are required to report debt to Pappas' office, many officials said they weren't sure what information they were supposed to send to Pappas.
Rosemont officials did not provide information to Pappas about a $35 million trust dedicated to pension costs for village employees, so the report showed the village's pension program was only funded at 45 percent. With the additional data, the pension program is funded at 70 percent, said village spokesman Gary Mack.
Some government groups did get the right numbers to Pappas, but said the situation is not as dire as portrayed in the treasurer's report.
In Prospect Heights, the pension program is only funded at 45 percent. However, city officials there said annual costs that draw from the fund are a fraction of the fund's total.
"The only thing that makes it dire is if you had your entire workforce retire at once," said City Administrator Anne Marrin.
Marrin said the city council has been working to boost total funding of the pension program.
Pappas contends local governments need to do better handling pension debt.
"At some point the pool will run dry if this formula isn't recalculated," she said.
Pappas suggested governments in the county should look to reduce employee counts to offset debt costs and implement automation and technological advances to increase efficiency.
"This simple, common-sense approach has saved taxpayers millions of dollars," Pappas said of similar efforts in her own office.
The Civic Federation, a tax watchdog organization that analyzes government budgets, commended Pappas' report.
"We think it's a strong contribution to the debate on the number of governments in Illinois as well as our local governments' debt levels and pension obligations," said Laurence Msall, the group's president.