During DeKalb’s first meeting on the proposed 2027 city budget, DeKalb’s mayor, Cohen Barnes, basically blew a fuse talking about pensions. Here’s what he said:
The police and fire pension crisis continues to make that [Illinois Municipal League priority] list every single solitary year. So, the advocacy is definitely there. It’s just still falling on deaf ears. A week and a half ago, I had a chance to talk to the governor and it didn’t go that well. Um, but ultimately I told him according to our projections in 2033, I’ll be driving down to Springfield with the keys to city hall, tossing them on his desk, and he can run the City of DeKalb and the State of Illinois if he doesn’t do something about the police and fire pension.
So dramatic! But is it really the state’s fault our pensions are eating us alive? No, it’s just our old friend Hiring Spree. Barnes campaigned for re-election in 2025 on hiring literally dozens of new first responders while holding the line on taxes. The result: increased escalation of unfunded pension liabilities and huge jumps in operations expenses have blown holes in annual budgets.
But instead of grabbing the pension beast by the horns, the administration has decided the state should lengthen the time the city has to play catchup on the liabilities. In other words, they’re trying to scapegoat the governor for our deficit spending.
And the hiring spree isn’t just about first responders, either. DeKalb’s 2025 financial reports show new sworn police and fire positions from 2022-2025 total 31, but new hires across the city during that time come to 44.5 in full-time equivalent staff, a citywide increase of more than 20% over the period.
It was a gamble to hire so many so fast, and we lost. To understand it, here are two important factors contributing to the current structural budget issue:
— Property taxes don’t directly pay for city services. By long-held policy, 100% of City of DeKalb’s property tax levy goes into pension funds. But because the city has to hold the line on property taxes or pay a political price, they devote other revenues to the pensions to close the gap.
— Day-to-day city operations (e.g., wages) are paid with those other general revenues, the largest sources being sales and income taxes. General revenues are growing, but not quickly enough to pay dozens more employees plus cover the widening gap between the amount of property tax collected and the required annual pension contributions.
The city’s answer so far — besides blaming the state — is to raid the city’s reserve funds in a piecemeal fashion. If nothing changes, DeKalb expects to exhaust the reserve and fail to meet expenses by 2033, the year the mayor said he expects to surrender the keys to city hall to the governor’s office.
The drama, of course, is an attempt to dodge accountability for structural budget deficits.
Will the city go bankrupt? No. We’ll just do what we’ve always done, which is change out the city manager and implement layoffs until the budget balances again. We will limp along and wonder why we can’t achieve.
Meanwhile, there are serious consequences happening today, and all along the path to the day of reckoning in 2033. Failure to pay down the unfunded pension liabilities is a continual drag on the budget — it guarantees we’re paying more annually in property taxes than we should, as if we’ve taken out loans at usury interest rates. We will also continue paying more for water than we need to, because water revenues secretly subsidize employees who don’t work for the water department.
Lastly, raising sales taxes next year is not out of the question: a proposal was brought up during the first budget meeting in August and may yet gain traction before the final vote near the end of the year.
Want to see numbers? Find some here, in the agenda for tomorrow’s budget meeting.
We’ve had a little chatter on the topic in the FB group, too.