DeKalb’s Pension Picture Updated

I’ve added FY2012 numbers to the set of charts you’ll find in DeKalb’s Pension Funding Progress. They come from the latest Comprehensive Annual Financial Report (CAFR).

[easychart type=”line” width=”420″ title=”Yearly Funding of Pensions by Percentage Funded” groupnames=”IMRF, Police, Fire” valuenames=”’99, ’00, ’01, ’02, ’03, ’04, ’05, ’06, ’07, ’08, ’09, ’10, ’11, ’12” group1values=”101.47, 109.49, 111.34, 107.18, 98.78, 82.83, 72.48, 73.17, 77.08, 80.46, 60.69, 62.50, 54.54, 57.73″ group2values=”88.52, 86.68, 73.96, 66.09, 65.26, 66.86, 67.12, 67.24, 71.63, 64.38, 55.91, 59.59, 64.99, 55.06″ group3values=”62.13, 57.64, 57.03, 52.85, 51.19, 53.21, 51.64, 49.44, 50.20, 46.16, 40.39, 42.59, 45.77, 41.65″ minaxis=”40″]

[easychart type=”vertbar” width=”420″ title=”Unfunded Pension Liabilities in $Millions” groupnames=”IMRF, Police, Fire” valuenames=”’99, ’00, ’01, ’02, ’03, ’04, ’05, ’06, ’07, ’08, ’09, ’10, ’11, ’12” group1values=”0, 0, 0, 0, .19, 2.80, 4.40, 4.83, 4.60, 4.10, 8.92, 9.06, 9.87, 9.2″ group2values=”2.09, 2.65, 5.77, 8.12, 8.83, 9, 9.4, 10.1, 9.15, 12.37, 16.13, 15.25, 14, 20.4″ group3values=”6.91, 8.52, 9.1, 10.6, 11.8, 12, 13.67, 16.11, 17.51, 20.5, 24.12, 24.43, 24.72, 29.2″]

[easychart type=”horizbar” width=”420″ title=”DeKalb Total Unfunded Pension Liabilities in $Millions” groupnames=”Total Pension Liabilities” valuenames=”’99, ’00, ’01, ’02, ’03, ’04, ’05, ’06, ’07, ’08, ’09, ’10, ’11, ’12” group1values=”8.9, 10.12, 13.41, 17.7, 20.81, 23.71, 27.48, 31.03, 31.27, 36.96, 49.17, 48.74, 48.56, 58.7″]

Besides retiree compensation rising some $200,000 per fund for the year, much of the startling jump in liabilities in FY2012 probably arose from investment losses (PDF pp. 159-160). In particular, the police fund experienced a net investment loss of nearly $1 million.

Budget Impacts of Pensions
Annual required contributions (ARCs) for the three pension funds rose from $3.1 million in FY2007 to $4.4 million in FY2012. The jump in retiree compensation alone, for police and fire by themselves over the past two years is about half a million — consistent with the FY2014 budget narrative stating pension costs overall are rising another 15% in the coming fiscal year.

These startling increases are especially bad timing laid against the reality of flat revenues. The designated revenue source for DeKalb’s pension costs (which include FICA as well as the union-related pension funds) is property taxes, and the city has had to raise rates several years in a row just to keep each levy at about the same amount as the year before.

Property taxes at this point make up 14% of the revenues of the $30 million General Fund budget, but annual pension costs have reached 16% of expenditures.

It makes sense to expect the financial consultants will address the pension situation in one of their workshops with city officials. Double-digit growth in these costs has got to be another reason DeKalb is casting about for new revenues.