SPRINGFIELD -- A bill that would reduce pension benefits for local public safety workers hired after Jan. 1 could move out of a legislative committee Wednesday, but mayors and unions representing police and firefighters still disagree on what should be in the bill.

SPRINGFIELD -- A bill that would reduce pension benefits for local public safety workers hired after Jan. 1 could move out of a legislative committee Wednesday, but mayors and unions representing police and firefighters still disagree on what should be in the bill. 

The Pension Fairness Coalition, which includes mayors from suburban Chicago and downstate who want to reduce benefits for future police officers and firefighters, predicted layoffs, deep service cuts and even possible municipal bankruptcies if the legislature does not act.

Legislative staff members are drafting language that will be inserted in Senate Bill 3538, said Mark Fowler, a spokesman for the Pension Fairness Coalition.

The legislation is sponsored by state Rep. Kevin McCarthy, D-Orland Park, and Sen. Kwame Raoul, D-Chicago. The new language was unavailable Tuesday. McCarthy did not immediately return a phone call seeking comment.

At a news conference Tuesday, the mayors, including Springfield Mayor Tim Davlin and Rockford Mayor Larry Morrissey, outlined what they want to see in a bill. Their proposals include increasing the retirement age, extending the number of years police and firefighters must serve before becoming eligible for their maximum pensions and capping the maximum at 72 percent of final average salary.

 

Negotiations fail

Local governments and the unions negotiated during the spring legislative session, but could not agree. In exchange for concessions, the unions wanted a provision that would allow the state to take tax money it owes cities and deposit it into their police and fire pension funds if they don’t make full payments, as determined by independent actuaries.

The unions said Tuesday they would not budge unless the provision is added.

“Any legislation designed to ‘fix’ fire and police pension systems must include the same protection that other municipal pension funds enjoy,” a statement by the Public Safety Employee Coalition said. The coalition includes the International Association of Fire Fighters, the Fraternal Order of Police, the Police Benevolent and Protective Association and the Illinois Public Pension Fund Association.

Under state law, if cities do not make required payments to the Illinois Municipal Retirement Fund, which covers city workers who aren’t police or firefighters, the IMRF can take the money.

A mechanism to claw payment out of the cities would be fair only if the 636 separate police and fire pension funds were consolidated, Fowler said.

Pensions are funded by investment income, employer contributions and employee contributions. To make their case, the unions pointed to the city of Springfield, which has repeatedly overestimated how much investment income its police and fire pension funds would earn. From 1999 to 2008, the city assumed an annual 8 percent return. The actual returns averaged 5.85 percent for the police fund and 5 percent for the fire fund.

 

Underfunding in Springfield

Davlin acknowledged that Springfield underfunded its pensions, but maintained the system is broken.

“We have been underfunded in spite of the fact in the last 10 years, we’ve increased our contributions 199 percent to our police fund and 327 percent to our firefighters’ pension fund,” Davlin said.

Asked whether it is reasonable to expect a firefighter or police officer to work until age 60, Davlin said under the mayors’ plan, they could still retire earlier – but in exchange for a reduced pension.

The mayors pointed to 44 communities that had advisory referenda on Nov. 2 ballot in which 80 percent of voters voted “yes” when asked if the legislature and the governor should enact police and fire pension reform.

Morrissey said Rockford citizens would welcome reform.

“If the headline, to specifically answer your question, reads, ‘Legislators strip benefits from firemen and policemen,’ I think our constituents are going to say it’s about time,” he said. “We’ve (Rockford) had the state’s highest unemployment rate for a metro community.

“We’ve had legislative rules passed that mean we can’t lay off a single firefighter. We’ve got a minimum-manning requirement (for firefighters), so all the pressure in the community with one of the highest crime rates in the state is on laying off cops. Everybody else is taking the hit.”

Chris Wetterich can be reached at 788-1523.

 

What’s next:

The bill, Senate Bill 3538, is scheduled to be heard today in the House Personnel and Pensions Committee at 9 a.m.

 

What the mayors want:

-- Firefighters and police retire with full benefits starting at age 60

-- Firefighters and police collect maximum pension after 35 years of service

-- Maximum pension of 72 percent of final average pay (based on the highest eight consecutive years out of the last 10)

 

What police and firefighters have now:

-- Full pension benefits starting at age 50

-- Maximum pension after 30 years of service

-- Maximum pension of 75 percent (based on salary on last day of work)