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Alderman blasts pension bill

Evanston Alderman Don Wilson says a public safety pension bill now on its way to Gov. Pat Quinn is "better than nothing" but is not a solution for the pension funding crisis facing Evanston and other cities.

Evanston Alderman Don Wilson says a public safety pension bill now on its way to Gov. Pat Quinn is "better than nothing" but is not a solution for the pension funding crisis facing Evanston and other cities.

The pension bill, passed by the state Senate today and approved by the House earlier this week, makes no changes in pensions for firefighters and police officers already on the job.

But it would raise the age for employees hired starting next year to get full benefits from 50 to 55 and make it harder for them to boost their pensions with late-career pay hikes.

Wilson, 4th Ward, says the state needs to move toward a 401(k) style system — so that taxpayers aren’t required to insure the workers against shortfalls in investment returns.

The system now "puts all the risk on city taxpayers," Wilson said, and the new bill does nothing to change that.

Another provision of the legislation would let pension funds seize income tax dollars due cities if the towns underfund pension plans. The Illinois Municipal Leauge has said that provision could force towns to dramatically raise taxes or gut services.

Wilson said, "I don’t want us to end up ever in the position that revenue that’s expected to come in from the state somehow gets intercepted."

He noted that the state’s failure to make timely payments to communities and to non-profits providing social services is already straining budgets in Evanston and other communities.

Wilson said it’s not yet clear how much the city might save as a result of the higher retirement age for new hires. But given that only about 3 percent of the city’s public safety staff retires each year, the benefit, at least in the next few years, would be very modest.

A Chicago Tribune report Sunday said Evanston’s fire and police pension funds rank in the bottom 10 percent of 351 suburban funds in term of how high a percentage of expected benefits they’ve set aside.

Evanston’s fire pension fund has 36.1 percent of the needed funds set aside and its police pension fund has 35.4 percent.

Both numbers have dropped significantly as a result of poor stock market performance in recent years, at the same time the city has been dramatically increasing its pension fund contributions.

Wilson said residents with concerns about cuts in funding for city programs need to start talking to state lawmakers about making more substantial reforms in the pension programs. Springfield, he said "has so much control over what we’re able, or not able to do."

"The next decade or two are going to be really tough for the city," Wilson said. "If we can get the economy turned around, that will help, but even then we can’t go on a spending spree." 

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