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HOUSE
PASSES PENSION BOOST BILL FOR ONE CHICAGO ALDERMAN
Illinois Policy Institute/
Vincent Caruso
Illinois House members voted to override Gov. Rauner’s veto of a bill
that would allow a former firefighter serving as a Chicago aldermen to
credit his political salary toward a more lucrative fire pension. While
just one alderman now qualifies, the bill could extend the perk to more
in the future.
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 State lawmakers are a step closer to extending an exclusive
pension boost to one Chicago alderman.
On Nov. 14 the Illinois House of Representatives voted 80-27 to override Gov.
Bruce Rauner’s veto on House Bill 5342. The bill will now advance to the Senate,
where it becomes law if it passes.
HB 5342, sponsored by state Rep. Robert Martwick, D-Chicago, would provide an
exclusive pension boost to Chicago aldermen who formerly worked for the Chicago
Fire Department. The bill would amend the Illinois Pension Code by redefining
“active fireman” under the Chicago Firefighter Article to include former firemen
currently serving on the Chicago City Council.
The bill would exclusively benefit Ald. Nicholas Sposato, 38th Ward, but would
ultimately apply to any alderman with a history of fire department work who has
served on City Council for at least five years. Sposato has muscular sclerosis
and uses a wheelchair.
Ald. Anthony Napolitano, 41st Ward, would be the next council member to qualify,
provided he secures a second term.
Under HB 5342, applying council members would have the option to forgo their
municipal pension plan and instead transfer their aldermanic pension credits to
the city’s fire pension system – regardless of how long they were firefighters.
The fire pension system delivers more lucrative retirement benefits than the
municipal fund. But those who stand to lose are current firefighters whose
retirement security is jeopardized by a severely indebted pension system, and
taxpayers on the hook to cover those deficiencies.
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As of fiscal year 2017, Chicago’s fire pension fund
had less than 21 cents on hand for every dollar owed in benefits. In
September, the Firemen’s Annuity and Benefit Fund of Chicago filed
two claims with the Illinois comptroller for a combined $3.3 million
shortage, alleging the city shorted it by $1.8 million in 2016 and
by $1.5 million in 2017.
All told, Chicago’s combined pension debt stands at
$42 billion.
Outgoing Mayor Rahm Emanuel’s solutions to the city’s pension crisis
have largely consisted of massive multiyear tax hikes, including a
property tax increase of $543 million, new taxes on ridesharing and
e-cigarettes, tax increases on water and sewer services and 911
calls, and hikes in fees ranging from garbage collection to building
permits. But those revenue increases have failed to tame the city’s
pension debt. Moreover, the city’s required pension contributions
are projected to more than double during the next decade.
The reforms needed to rein in growing pension costs must come
ultimately from state lawmakers, beginning with a constitutional
amendment, and ending with an affordable 401(k)-style alternative
for all future government workers.
The determination with which lawmakers have sought to a push through
the state Capitol a pension boost for just one city council body –
let alone one council member – puts Springfield’s misplaced
priorities on display.
Any efforts aimed at encouraging participation in – and increasing
the cost of – unsustainable defined-benefit pensions systems is a
step in the wrong direction.
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