Download resolution no - Village of Schaumburg

RESOLUTION NO. ________________
RESOLUTION URGING THE GENERAL ASSEMBLY TO STOP MAKING BENEFIT
IMPROVEMENTS AND TO PROTECT POLICE AND FIRE PENSIONS
WHEREAS, the Village of Schaumburg (“Village”) is a home rule municipality in accordance
with Article VII, Section 6 of the Constitution of the State of Illinois of 1970, pursuant to which it has
the authority, except as limited by said Section 6 of Article VII, to exercise any power and perform
any function pertaining to the government and affairs of the Village; and
WHEREAS, as required by Illinois law, the Village has established the Police Pension Fund
and Firefighters Pension Fund, which are funded by taxes levied by the Village; and
WHEREAS, retirement and disability benefits granted by the Illinois General Assembly have
substantially increased the liabilities of local police and fire pension funds and threatens their longterm sustainability; and
WHEREAS, the Illinois General Assembly has not provided any funding for local
governments to pay for the increased benefits they have authorized; and
WHEREAS, pension benefit increases and a difficult investment climate in the capital
markets have contributed to a doubling of the liability or police and fire pension funds from 1999 to
2004, which ultimately must be paid by local municipal taxes; and
WHEREAS, the statewide average liability for police pension funds as of 2004 was
$179,958 per active police officer and the average liability for firefighter pension funds was $176,845
per active firefighter; and
WHEREAS, statutory restrictions on investment authority limit the ability of local police and
fire pension funds to diversify their investment portfolios, thereby lowering investment returns and
increasing local municipal taxes; and
WHEREAS, there is no certainty that the current benefit levels are sustainable by
municipalities for the existing and improved benefits; and
WHEREAS, local tax payers are ultimately financially responsible for the growing pension
obligations and will invariably be expected to pay those costs.
NOW, THEREFORE, BE IT RESOLVED BY THE PRESIDENT AND BOARD OF
TRUSTEES OF THE VILLAGE OF SCHAUMBURG:
SECTION ONE:
The foregoing recitals are hereby incorporated as the findings of the
Council of the Village of Schaumburg, as if fully set forth herein.
SECTION TWO:
The Village of Schaumburg urges the Illinois General Assembly to:
1)
Stop approving any new or increased police and fire pension benefits;
2)
Reform the Public Safety Pension Funds as follows:
RESOLUTION URGING THE GENERAL ASSEMBLY TO STOP MAKING BENEFIT IMPROVEMENTS AND TO
PROTECT POLICE AND FIRE PENSIONS
3)
a)
Require state-funded fiscal impact assessments on 25-50 selected
municipalities before any proposed pension legislation can move
beyond the committee stage. Additionally, fiscal notes should be
enhanced to provide more specific data regarding fiscal impact.
b)
Exempt the pension levies for public safety pensions from PTELL.
c)
Restrict the ability of a fiduciary to knowingly cause or advise the fund
to engage in an investment transaction when the fiduciary has any
direct interest in the income, gains or profits of the investment advisor
through which the investment transaction is made or has a business
relationship with the investment advisor that would result in a
pecuniary benefit to the fiduciary as a result of the investment
transaction.
d)
Establish minimum standards for investment, actuarial and other
professional services utilized by the pension funds.
e)
Reform the Illinois Department of Financial and Professional
Regulation by adding additional staff to provide improved service to
pension funds and municipalities. Improved services could include
additional and more frequent fund audits and an analysis of fund
investment performance.
f)
Anti-fraud disability measures to ensure that disability benefits are only
received by those deserving of them.
g)
Municipal right-of intervention in all pension decisions – both
retirement and disability awards. All benefit awards must be referred
to the city and await calculation verification before the award can be
disbursed.
h)
Require pension boards to fund an annual publication in local
newspapers making public the financial status and benefit awards of
the municipal police and fire pension funds.
i)
A state agency should be assigned the task of publishing a
comprehensive and detailed biennial report on the financial health of
the Article 3 and Article 4 pension funds.
Broaden local investment authority to allow for police and fire pension funds to
hold up to 60% of their assets in common stock as long as a professional
independent investment advisor is retained by the local board.
RESOLUTION URGING THE GENERAL ASSEMBLY TO STOP MAKING BENEFIT IMPROVEMENTS AND TO
PROTECT POLICE AND FIRE PENSIONS
SECTION THREE: This Resolution adopted by the Village of Schaumburg in the exercise
of its home rule powers pursuant to Section 6 of article VII of the Illinois Constitution of 1970.
SECTION FOUR:
This Resolution shall be in full force and effect after passage
and approval as required by law.
AYES:
NAYS:
ABSENT:
PASSED AND APPROVED this
day of
, 2008.
_____________________________________
VILLAGE PRESIDENT
ATTEST:
_______________________________
Village Clerk
APPROVED:
_______________________________
Assistant Village Attorney
S:/legal/reso/Protect Fire and Police Pensions