Pension deal must address abuses
BY ANDY SHAW Better Government Association June 14, 2013 4:54PM
Updated: July 16, 2013 6:28AM
Illinois lawmakers are returning to Springfield on Wednesday for a special session on the pension crisis.
They’re searching for a plan that’s fiscally sound, constitutional, politically palatable and capable of winning passage in the Legislature.
So far they haven’t found it, which is no surprise because it’s a daunting challenge.
But they have to, and soon, because state and local pension systems are heading toward insolvency, and current pension obligations are gobbling up too many scarce budget dollars.
So reform is imperative, and that means — in addition to a comprehensive fiscal solution — a targeted ethical cleansing that outlaws the blatant abuses that enrich connected insiders at taxpayer expense.
Watchdogs have been exposing those scams for years, including last week’s BGA report in the Sun-Times about a dubious pension “sweetener” that was quietly engineered by the Daley administration in ’08 to boost former fire commissioner Ray Orozco’s pension by $27,000 a year.
Orozco ran the fire department for only two years, but his pension calculation is inexplicably based on four, which is an apparent “abuse of service credit,” one of the “no-no’s” lawmakers should consider abolishing.
The others include “spiking,” “tacking” and “double dipping.”
“Spiking” is awarding end-of-career raises that boost pension payments for life. Village officials in south suburban Lansing did it to encourage cops and firefighters to retire early, but they ended the practice last year after the BGA revealed the onerous long-term impact on their taxpayers.
“Tacking” refers to contractors and consultants who improperly join pension plans even though they’re not government employees.
That occurred in another south suburb, Calumet City, where officials quietly began treating their top attorney, a contract worker, like a full-time city employee eligible for pension benefits that could eventually top $2 million.
The pension fund that oversees the payouts began investigating after the BGA and Sun-Times started questioning the deal.
And “double-dipping” is just that — collecting more than one public pension, or merging several government jobs into one super-sized pension.
The latter is what enabled a former Oak Brook police chief from a prominent political family to boost his pension by $30,000 a year, which sticks taxpayers in the western suburb with an additional pension liability of about $750,000.
That chicanery was facilitated by a legislative maneuver in Springfield that Oak Brook’s been challenging since the BGA disclosed it last year.
Ending abuses like these won’t fix the overall pension crisis, but it’ll help restore faith in the system by leveling the playing field so lawmakers aren’t asking taxpayers and hard-working public employees to sacrifice while connected insiders maintain inflated pensions they don’t deserve.
It’s an essential part of comprehensive pension reform, and we commend the local officials who’ve tried to tackle it piecemeal in their own communities after our investigations.
To that end, we’re also hoping Mayor Emanuel reconsiders his initial disinclination to challenge or even comment on the former fire commissioner’s pension “sweetener.”
Emanuel says the focus on individual abusers detracts attention from the severity of the overall pension crisis.
But everyone multi-tasks these days, so Illinois lawmakers should be able to impose statewide bans on the little scams at the same time they’re cleaning up the big pension mess.
That’s their challenge as they head back to Springfield.
Let’s see if they’re finally up to it.
Andy Shaw is President & CEO of the Better Government Association. Email him at email@example.com or call 312-386-9097.