Pension Post (and CA 49)
This popped up in the comments:
- On 01 October 2012, our City Council conducted hearings regarding city pensions including the Police & Fire Pensions. John Gallagher, Executive Director of the Police Pension Fund took the stand along with others to answer questions from the aldermen.
Mr. Gallagher is remarkable advocate for his constituents -the active and retired members of the police department. It was recently announced that Mr. Gallagher will be leaving our Fund. I hope the new Executive Director has the same fire as Mr. Gallagher.
Below are some facts and myths debunked at the hearings:
Facts:•Our Pension is currently funded at approximately 35%.
•Approximately 11,800 sworn members are currently contributing to our pension fund.
•3,200 sworn members are 50 years old with 20 years seniority (27% of all sworn members).
•Approximately 55% of retirees continue to live and spend money in Chicago.
Myth:The city does not make their full payments to the pension fund.
Fact:The city has statutorily met all its payments to the pension fund.
Myth:The 2 times multiplier the city currently contributes to the pension is enough.
Fact:According to Executive Director Gallagher, he has repeatedly informed the city that the 2 times multiplier is NOT enough.
Myth:The pension fund is not hitting its mark on investments.
Fact:The Actuarial Assumption for our fund is 8%, the pension fund has actually averaged about 8.8% since 1974. The Fund is currently over 10% for 2012, year to date (October 2012).
Myth:Active members will not contribute more than 9% of their salary to the pension.
Fact:Most active members will agree to a slight increase in the amount they contribute to their pensions Myth: Police pension COLAs are compounded annually.
Fact:Police Pension COLAs are NOT compounded.
Fact:No one born after 01 January 1955 will receive a COLA until they are 60 years of age and that COLA will be 1.5%.
According to a Chicago Tribune/WGN-TV Poll published on 16 October 2012, "Illinois voters overwhelmingly blame politicians for creating the state's public employee pension mess."
Executive Director Gallagher has been sounding the alarm for years. Voters know this is not a problem that occurred overnight. However, Alderman Richard Mell at the hearings is quoted, "We have to solve the situation as quick as we possibly can." (Chicago Tribune, 02 Oct 12). I hope the alderman means long term plans are needed, not a quick fix, because a quick, knee jerk reaction will NOT solve this problem.
VOTE "NO" on the proposed amendment to the Illinois Constitution, Resolution #49!
One of these knee jerk reactions is the proposed amendment to the Illinois Constitution, Resolution #49. This hastily written amendment WILL send many pension issues to the courts because it is written with such vague terms. No one wants their pension money/payments tied up in the Illinois Court System!!
Who will decide what a pension benefit increase is? Perhaps even the inequitable 1.5% COLA increase at age 60 will require a 3/5 majority of the legislature. Why let the courts decide on your pension! Please vote "NO" and tell your family and friends to vote "NO."
Lt. James Maloney
Pension Board Representative
Lt. Michael Dejanovich