R-1010 - 03/11/2008 - GENERAL LEGISLATURE - Resolutions Supporting DocumentsITEM 10.11.2)
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AGENDA ITEM
Regular Board of Trustees Meeting
of
March I I, 2008
SUBJECT: Pension Reform Legislation
FROM: David Niemeyer, Village Manager
BUDGET SOURCE /BUDGET IMPACT: n/a
RECOMMENDED MOTION: Motion for Passage of Resolution R -1010, A Resolution in
Support of Urging the General Assembly to End Costly Benefit Movements and Instead
Adopt Reforms which Protect Police and Firefighter Pension Funds.
Background /History:
The Illinois Municipal League has asked all of its members to adopt a resolution to bring
attention to the problem of growing debt in police and fire pension funds largely caused by
continual increases in pension benefits approved by the General Assembly over the last several
years. Oak Brook's police pension fund is funded at 86.2% and fire pension fund is funded at
78.8 %. This is better than most of the neighboring communities as shown on the attached chart
but less than what is recommended by state sources, which is 90 %.
Separately, the resolution also urges support for a legislative initiative of the Illinois Municipal
League that help protect municipal public safety pension funds through public disclosure of
pension fund finances. The measure would also provide conflict of interest protections applicable
to pension service providers, an anti -fraud provision for disability awards, minimum credential
standards for service providers, regular audits of fund performance, and greater flexibility to pay
for state mandated pension benefit levels.
Recommendation:
The recommendation is for passage of a resolution urging the General Assembly to end costly
benefit improvements and adopt reforms for police and pension funds.
Last saved by charty J \AGENDA MEMOSTension Reform doc
Last printed 3/6/2008 2 41 PM
2007 Funding Percentages
Police
Fire
Aurora
56.4%
56.1%
Downers Grove
70.9%
64.0%
Elmhurst
72.2%
71.6%
Geneva
74.5%
89.5%
Glen Ellyn
69.7%
Lisle
67.9%
Lombard
71.1%
79.7%
Naperville
71.9%
75.2%
Oak Brook
86.2%
78.8%
St. Charles
66.9%
87.7%
Villa Park
74.6%
80.3%
Wheaton
67.0%
77.7%
Average
70.8%
76.1%
RESOLUTION 2008 -GL -R -1010
A RESOLUTION IN SUPPORT OF URGING THE GENERAL ASSEMBLY
TO END COSTLY BENEFIT IMPROVEMENTS AND INSTEAD ADOPT
REFORMS WHICH PROTECT POLICE AND FIREFIGHTER PENSION FUNDS
WHEREAS, the Illinois Police and Firefighterfighter Pension Funds are facing uncertainty and a
financial crisis is developing; and
WHEREAS, generous retirement and disability benefits have caused the Funds to incur
escalating debt that threatens their long -term sustainability, and
WHEREAS, the Illinois General Assembly has continued to add to the growing costs of these
Pension Funds through increasing benefits without providing additional revenues; and
WHEREAS, benefit increases in recent years have contributed to a doubling of the debt carried by
Police and Firefighter Pension Funds from 1999 -2004, and
WHEREAS, the amount of debt carried by Police Pension Funds as of 2004 reached $179,958
per active police officer and the amount of debt carried by Firefighter Pension Funds reached $176,845
per active firefighter; and
WHEREAS, there is no certainty that the current benefit levels are sustainable by municipalities
for the existing and improved benefits; and
WHEREAS, local taxpayers are ultimately financially responsible for the growing pension
obligations and will invariably be expected to pay those costs, and
NOW, THEREFORE, BE IT RESOLVED by the President and Board of Trustees of the Village of
Oak Brook, DuPage and Cook Counties, Illinois, as follows.
Section 1: That the Village President and Board of Trustees for the Village of Oak Brook
hereby urge the General Assembly to stop approving new and increased pension benefits for the Police
and Firefighter Pension Funds.
Section 2: That the Illinois General Assembly embrace sensible pension reforms in the
areas of ethics reform, professionalism of Fund management, public sunshine and disclosure of Pension
Board activity, conflict -of- interest restrictions, accountability measures, improved cost impact analysis,
meaningful regulation and enhanced local government funding authority.
Section 3- All resolutions or parts of resolutions in conflict with this resolution are hereby
repealed to the extent of the conflict
Section 4 This resolution shall be in full force and effect from and after its passage, approval
and publication as required by law.
APPROVED THIS 11th day of March, 2008
John W. Craig
Village President