Police & Fire Pensions are only part of DeKalb’s liability story

The Better Government Association has just rolled out a statewide police and fire pension database. It tracks public safety pensions for every municipality, township, and special district (e.g., fire protection district) that have one or both types of pension funds.

According to this database, DeKalb’s fire pension showed a net liability of $42.7 million and a 39.21% funding ratio “as of 2016.” At the same point in time, the police pension fund had a net liability of $34.4 million and a funding ratio of 48.77%. The combined net liability, then, was a bit over $77 million.

I’ve checked the BGA numbers against the city’s latest annual financial report to make sure they’re in the same ballpark, and they are.

What the BGA database doesn’t tell you about is DeKalb’s other long-term liabilities related to retirees. One is the Illinois Municipal Retirement Fund (IMRF) — yeah, it’s not 100% funded as you might think. The city’s latest reported IMRF net liability is $9.4 million and funding at 83.2%.

Another, as discussed here a few months ago, is the Other Post-Employment Benefits, which is a defined-benefit retiree health insurance plan. OPEB — which our financial consultants have twice urged us to dump in favor of a defined-contribution PEHP plan* — has an unfunded long-term liability of $23.9 million and a funding ratio of 0% because the city doesn’t fund this plan in advance.

Audited numbers for 2017 should come out in May. Meantime, we’re looking at unfunded retirement-related liabilities of $110 million.

*City employees hired since 2011 do participate in a PEHP instead of OPEB.

BONUS: DeKalb’s pension funding ratios as of 1999 (as reported in the fiscal 2004 financial report):

IMRF: 109.49%
Police: 88.52%
Fire: 62.13%

We’ll soon see what this council is made of

***Updated 6pm: Check out the city attorney’s “blooper” during last evening’s meeting when he explained why he advised the mayor to adjourn the meeting before council could vote on the matter at hand. I’ve placed a video clip of it at the end of this post, or you could click here for the clip and to comment on Facebook. ***

DeKalb’s city council violated the Illinois Open Meetings Act (OMA) yesterday. It was a violation because the city scheduled a special meeting for Good Friday, which is a legal holiday in this state. Specifically, OMA says this:

Sec. 2.01. All meetings required by this Act to be public shall be held at specified times and places which are convenient and open to the public. No meeting required by this Act to be public shall be held on a legal holiday unless the regular meeting day falls on that holiday.

You can easily find several state departments and offices where Good Friday is not observed, and obviously City of DeKalb doesn’t observe it. Doesn’t matter. If a statute establishes it as a holiday, it’s a legal holiday and you have to watch out for OMA.

And unlike meetings where you could goof up an OMA rule but then save your public body by not taking action (i.e., not actually voting on anything), the legal holiday rule says you can’t even hold the meeting without committing a violation.

I attended yesterday in order to congratulate the council on making a major change in management, to express my understanding of the huge undertaking in finding a new city manager, and to point out that the vacuum created by a city manager’s exit has led to major overspending in the past. Continue reading We’ll soon see what this council is made of

Public Safety Consolidation ‘Inevitable’

A new article from the Better Government Association explores growing pressures to consolidate public safety services.

…[M]unicipal budget shortfalls are forcing a growing segment of Northern Illinois suburbs to consider what was once unthinkable: Merging basic hometown public safety operations with neighboring or regional governments, such as the county sheriff’s departments.

Skittish residents, however, are concerned these reconstituted public safety departments will be more widespread and less responsive to their local safety and emergency needs. Nonetheless, the trend is likely to extend deep into other suburban areas and rural Illinois, say public finance and municipal experts.

I’ve occasionally engaged in casual conversations about formation of a metropolitan police agency or emergency services center belonging to DeKalb, Sycamore and perhaps one or two additional surrounding communities.

Although municipal revenue free falls have generally stopped since the recession ended, yearly revenue increases are now typically small and devoured instantly by increases in expenditures for insurance, commodities and contractual raises. Nobody knows when this trend of flatlined revenues will end. Meanwhile, raising taxes is politically difficult and, in many suffering communities, would be downright cruel. The alternatives are to watch service delivery capabilities erode or to find more economical ways to deliver services.

Careful consolidation could help us realize significant economies of scale by applying a metro or regional focus to eliminate duplicate administrative functions, equipment and software purchases and so on. But we’d have a much better chance of doing it right if we start planning during a relative period of calm. In other words, if we’re going to have the conversation, let’s do it now.

“We Are Taking Edgebrook”

The following is a report from DeKalb Police of a gathering on the 800 block of Edgebrook Drive in the wee hours of Saturday, August 25.

Due to a large crowd gathering the previous night, I assigned officer Boldt to monitor the lot at 809 Edgebrook and to advise me of any large parties forming.

He advised me that there was a party at apartment 8 and the apartment was full with some people standing outside. We arrived and advised the occupant to move everyone inside and not allow any more people inside. He was warned that if a crowd gathered outside his apartment, that he would be cited. During this time other officers cleared the lot of approximately 10 cars and 30 people who did not reside at the complex.

Cars that had exited the lot were stuck in traffic from other cars wanting to enter the lot. The lot was blocked as was the intersection of Normal and Edgebrook. During the time it took to clear the road, two groups of people began to gather on opposite sides of the street where officers were directing traffic.

Officer Boldt was getting names of tenants in other apartments with loud parties. While preparing to clear officers from the scene, I heard a passerby speaking on his phone. I heard him say, “We are taking Edgebrook.” Continue reading “We Are Taking Edgebrook”

Comment on 8/27/2012 Council Meeting Agenda

OK, Council, you said you’d bond out no more than $12 million but now staff is coming at you with a proposal for borrowing $14 million.

It’s not that Peace Road and the fire stations don’t need attention. They do — especially Station 2. But is this really the way to do it? Bundling the police station funding with three other projects ’cause it’s “only” $2 mil more? Because there’d not be much time to examine the fine print on the new proposals.

Let’s start with some fine print about asbestos in Station 2, a 55-year-old building. It is not mentioned in the agenda backup memo. How much of the $180,000 estimate is meant for asbestos removal/remediation? When do we get to find out?

Rockford Moves to Seek Bids for Ambulance Service

…and street sweeping. Rockford Register Star:

The City Council Finance and Personnel Committee and City Council approved a controversial request involving ambulance service at meetings Monday night.

The committee’s aldermen voted unanimously to let city staff develop a request for proposals from the private sector for citywide ambulance response. The Rockford Fire Department provides the service, but city leaders have been discussing the possibility of outsourcing the function for the past year.

Rockford’s consultant and its Budget & Finance Advisory Committee consider the functions “potential outsourcing recommendations” but they won’t know for sure until proposals come in.

DeKalb Firefighters’ Step B

[Correction 7/5: Whoops! The link provided goes to Aurora, CO, not to Aurora, IL, which is IAFF Local 99. Many thanks to the reader who let me know.]

Check out p. 60 of the DeKalb firefighters’ contract with the city. It’s the appendix showing the base pay agreement for the latter half of 2010, the one labeled “4% General Increases For All Classifications”.

Step A to Step B is not part of the 4% “general” increase. For example:

Firefighter/Paramedic Step A annual salary: $54,682.78
Firefighter/Paramedic Step B annual salary: $67,332.91

This is an increase of more than 23%.

In a related development, I’m creating my own chart of firefighter/paramedic base pay salary comparisons, but have gotten stuck on Aurora, which has a breakdown into several more firefighter pay grades than other municipalities do. If a knowledgeable someone could take a gander at p. 18 and let me know which one fits best, I’d be grateful. Contact yinn@citybarbs.com.

Rockford Firefighters Get 6% Pay Raise

An arbitrator awarded a 6% pay raise to Rockford firefighters.

City officials said the award will cost taxpayers an estimated $618,000 in 2011 and more than $1.2 million in 2012 when the 6.1 percent wage is in effect for a full year.

Arbitrator Robert Perkovich rejected the city’s offer of a 2 percent wage increase this year. [IAFF Local 413 president Lt. Brad] Walker called the salary hike overdue.

“There were no raises in ’09 and ’10,” he said. “We went 26 months without a general wage increase.”

Walker said the wage hike keeps the city’s firefighters in the same ballpark as other Illinois fire departments of similar size.

“We were just trying to stay close to our comparable cities,” Walker said of Aurora, Bloomington, Champaign, DeKalb, Joliet, Peoria and Springfield.

Rockford already faces a deficit of $4 million in the coming year. At least one alderman is calling for outsourcing ambulance services in response to the crisis.

Last in Line

As predicted in Sunday’s post, suddenly DEKALB’S FIRST RESPONDERS ARE #1 PRIORITY AND OMG WE MUST BUILD THE POLICE STATION RIGHT NOW, according to our city council.

It offends me deeply, because the The NUMBER ONE PRIORITY statement is a BIG LIE. The people who really have made public safety the priority are the folks who have protested new SUVs, serial land acquisitions, and ReNew DeKalb’s insatiable appetite for baubles ever since the first of the budget troubles appeared three-plus years ago.

If first responders were really the NUMBER ONE PRIORITY, Council would have insisted one or two of them be hired instead of a central purchasing person and an economic development person/company.

If public safety were really the NUMBER ONE PRIORITY, Council would have found a way to squeeze a couple more cops out of the $400,000 freed up from the debt restructuring.

They should knock it off already. The real story is probably some combination of a) the City being shamed by recent events, and b) the banker overlords requiring a new infusion of tax dollars now that the downtown project is winding down. Continue reading Last in Line