Not all suburbs like plan to combine police, fire pensions

  • Barrington Hills Village President Martin McLaughlin

    Barrington Hills Village President Martin McLaughlin

  • Hoffman Estates Mayor Bill McLeod

    Hoffman Estates Mayor Bill McLeod

Updated 11/1/2019 10:18 AM

While some towns want state lawmakers to take quick action on a recommendation to combine suburban and downstate police and firefighter pension funds in an effort to boost returns and cut costs, not all municipalities are on board.

Senate President John Cullerton introduced a bill Tuesday to consolidate the 649 suburban and downstate police and fire pensions. Gov. J.B. Pritzker followed with a statement praising Cullerton's move in the first half of a six-day fall veto session that ended Wednesday.


Combining the hundreds of pensions into two funds -- one for police and another for firefighters -- could generate $820 million to $2.5 billion in additional earnings in just the first five years, assuming they earn at roughly the same rate as the large Illinois Municipal Retirement Fund, according to last month's recommendation from a task force initiated by Pritzker.

At village board meetings this week, elected officials in Northwest suburban Hoffman Estates and Barrington Hills passed resolutions with competing requests for the General Assembly.

Barrington Hills is asking lawmakers to take their time and not pass the proposal during the veto session. The session's second three-day leg runs Nov. 12-14.

In part, Barrington Hills' resolution says the Pension Consolidation Feasibility Task Force's recommendation would be a complex financial, economic and operational undertaking requiring "proper and comprehensive analysis and review by all stakeholders" and should not be pursued until the regular legislative session starts next year.

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"In my opinion, they're trying to penalize cities that are performing well and lump them into cities that are not performing well," Barrington Hills Village President Martin McLaughlin said.

But Hoffman Estates' resolution asks lawmakers to address the public safety pensions when the current veto resumes. Hoffman Estates is mirroring the Illinois Municipal League's position.

"I think if this passes, this will be a great thing for us," Hoffman Estates Mayor Bill McLeod said.

Support for the pension consolidation also is coming from the DuPage Mayors and Managers Conference, which in a statement touted potential benefits including cost savings and protecting the credit ratings of towns. Naperville has a resolution in favor of the pension combination on its city council agenda for Tuesday.

Illinois Municipal League Executive Director Brad Cole issued a memo to members across the state saying it's "critical" for local government officials to contact legislators and encourage them to support the merger.


"The current public safety pension system is unsustainable for local taxpayers and future pension benefit recipients alike," Cole said in a statement. "Local governments are responsible for the health, safety and welfare of residents, but they cannot fulfill that commitment if pension costs cut into essential services."

Suburban and downstate police and fire plans have on average $22 million in assets per fund, compared with $16.9 billion for each of the six state retirement funds that include judges, teachers and the General Assembly, according to the governor's task force.

Administration costs for the 649 local fire and police plans are much higher than for the Illinois Municipal Retirement Fund or others serving the entire state. The task force report says fire and police plan consolidation could cut those expenses by at least $14 million per year.

• Daily Herald staff writers Eric Peterson, Robert Sanchez and Marie Wilson contributed to this report.

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