House Votes for Reforms of Police, Fire Pensions
By Chuck Sudo in News on Dec 1, 2010 4:37PM
The state House was in major "TCB" mode yesterday. In addition to approving the civil unions bill and allowing for a gas plant to be built on the Southeast side, they voted in favor of reforms to police and fire department pensions. By a 95-18 margin, the House voted to raise the retirement age to receive a full pension from 50 to 55; addresses the issue of giving end-of-career retirement bonuses that boost retirement benefits, but only for new hires; and limits payouts by setting a ceiling of $106,800 on which a person's pension can be based.
Probably the most notable reform is a provision requiring Chicago to meet its funding obligation in future years. If the bill passes the Senate and is signed into law by Gov. Quinn, that could blow a $500 hole into Mayor Daley's MacGuyvered 2011 budget. City Budget Director Eugene Munin said of the provision, "In an environment when we already have problems in neighborhoods with foreclosures and people losing their homes, to put that kind of burden on the property owners in the city of Chicago seems to be having the pendulum swing a little bit too far the other way." Orland Park Rep. Kevin McCarthy said that they can revisit the provision at a later date if it's "too draconian for the city to handle."
A report in Sunday's Tribune showed that suburban police and fire pension plans are underfunded by $5 billion as a result of of mismanagement, pension spiking and repeated underfunding. Crain's last week reported the average worth of a fireman's pension to be $1.3 million, and a policeman's $1.2 million. Like the civil union bill, it isn't a full forward step, but one in the right direction.