Barrington sues fire district for $1.2 million
A lawsuit filed by Barrington Wednesday charges the Barrington Countryside Fire Protection District is refusing to pay at least $1.2 million owed to a formerly joint firefighters pension fund.
But the fire district, in an audit, claims it has no liability for the pension fund.
The suit states that when the fire district split from the village-run fire department on Dec. 31, 2013, the pension fund was short $1.9 million. Village officials argue the fire district's leaders in 2005 agreed to pay 64.25 percent of "fire services costs," which includes pension obligations. That amounted to more than $1.2 million at the time of the split, according to the lawsuit. The village is also seeking more than $800,000 from the district in long-term disability insurance costs.
"I think the agreement was pretty straightforward," said Village President Karen Darch. "I hope they will recognize that and we can avoid an extensive discussion in the judicial system."
Tom Long, the president of the fire district's board, said he hadn't seen the lawsuit, but called the allegations "half-truths and falsehoods."
The final price tag might actually be higher, though. The suit also contends fire district officials asked the village to recalculate the outstanding pension liabilities based on a state pension-funding formula. That calculation increased the district's costs to more than $2 million. A judge will not only have to determine whether the fire district owes the village anything, but if so, whether it's $1.2 million or the new $2 million figure.
The two sides met in an attempt to resolve the dispute in September 2014, but could not agree, village officials said.
Village Manager Jeff Lawler said the village was left with no recourse but to sue.
"This is unfortunate, but it's of their doing," Lawler said. "Prior to the split, for 19 years they paid under this formula."
Village officials said they have sent invoices to the district since the split, but the district has refused to pay the full amount village officials say they are owed. Last June, the village returned a $14,000 check the district sent to the village.
Before the split, the district paid the village to provide fire protection. But in years leading up to the separation, the district's board became increasingly critical of how the village was operating the fire department. When the intergovernmental agreement came up for renewal, the two sides decided to part ways and split equipment and other physical resources.
Lawler said the separation agreement also noted that the district would be getting a bill for all unfunded pension obligations, which would likely be "of a seven-figure magnitude."
The lawsuit also seeks reimbursement for legal costs associated with the village's struggle to recoup retirement and disability benefit funding from the district.
"This won't affect service in anyway," Lawler said. "We intend to comply with all of our mutual aid agreements and deliver service to the areas that might need our assistance."
The fire protection district's most recently completed audit shows the district has more than $2.5 million in reserves. The district received the majority of its $5.9 million in revenue from property taxes, to the tune of $5.6 million in 2014. However, the district's expenses were more than $6.2 million last year, according to the audit.
The audit also acknowledges the invoices from the village, but claims the district's own calculations assumes no liability for the pension fund. It offers no suggestions on how to reconcile the dispute.
"It is not possible to determine the outcome of the matter at this time," auditors wrote.
As for the long-term disability debt, the district argued in its audit that its payments should be made at the time the village pays claims, rather than an assumed total lifetime cost that may actually wind up being less.