Skillicorn Focuses on LITH Polilce Pensions

From State Rep. Allen Skillicorn:

State Rep. Allen Skillicorn: Lake in the Hills Shores up Deficit in Police Pension Showcasing Need for Pension Reform

Last month, Lake in the Hills Village Board approved the allocation of 1.5 million for the Village’s police pension fund for the 2019 levy year, which is a 9.17% increase.

Crystal Lake, IL – State Representative Allen Skillicorn (R-Crystal Lake) says the Lake in the Hills Village Board decision to increase funding for the Village’s police pension fund is another illustration of some of the structural problems that exist with public pensions in Illinois.

“I commend Lake in the Hills for being financially responsible and making sure their police pensions are properly funded, but the issue of pension funding is something affecting many Illinois communities,” Skillicorn said.

“Communities across the state are having major issues when it comes to pensions. Just look at the City of Chicago. Local officials there want a state bail out for city pensions because the city can’t afford to pay pension and fund day to day government operations.

“We need real, meaningful pension reform in Illinois.”

 Skillicorn said another problem is the lack of oversight when it comes to pensions. Former Deputy Police Chief Alan Bokowski still gets to keep his $84,000 annual pension despite being in prison for sexually assaulting a minor.

Allan Bokowski Department of Corrections photos

“Deputy Chief Bokowski should not be receiving a public pension,” Skillicorn said.

“We need rules in place to make sure that when people commit barbaric crimes such as raping a minor – they must forfeit their public pensions. Taxpayers in Lake in the Hills just had to bailout the local police pension to the tune of $1.5 million and a portion of those funds are going to a child rapist. This should enrage every taxpayer not just in Lake in the Hills but across the state.”

Skillicorn has been a strong advocate for pension reform.

His plan is to ask voters by ballot initiative to amend the Illinois Constitution to give lawmakers the authority they need to implement reforms.

Specifically, some of the reforms Skillicorn supports includes

  • capping all pensions to $132k (including double dippers)
  • raising the current retirement age one year to 61
  • raising it to 63 in five years
  • limiting COLAs to the Consumer Price Index and
  • limiting pension benefits for violent criminals.

“It is time to get serious about pension reform in Illinois,” Skillicorn said.

“The longer we wait, the more difficult this problem is going to be to solve. Unfortunately, the Democrat majority in Springfield seems to be more interested in raising taxes than they are on solving the pension crisis.”


Comments

Skillicorn Focuses on LITH Polilce Pensions — 5 Comments

  1. Skillicorn is spot on! –>

    “We need rules in place to make sure that when people commit barbaric crimes such as raping a minor – they must forfeit their public pensions. Taxpayers in Lake in the Hills just had to bailout the local police pension to the tune of $1.5 million and a portion of those funds are going to a child rapist. This should enrage every taxpayer not just in Lake in the Hills but across the state.”

  2. If being a policeman is considered “public service” why the hell is the there a taxpayer supported pension?

    All jobs in the public sector should be funded with a fair salary and the employee should be responsible for any pension he / she / it wants to fund.

  3. Illinois Department of Insurance > Public Pension Division > Reports / Orders > Public Pension Division Public Pension Portal > Lake in the Hills Police Pension Fund

    insurance.illinois.gov/Applications/Pension/PensionDataPortal.aspx

    Here you can see the Annual Statements that include current pay and pensions of police and fire employees and retirees enrolled in a “Downstate” police or fire pension fund.

    This does not include the City of Chicago and smaller departments or districts which participate in the IMRF pension fund, as opposed to a Downstate Police or Fire pension fund.

    So, for instance, the Lake in the Hills Police pension fund is included.

    Lake in the Hills does not have a fire department but is covered by the Algonquin Lake in the Hills FPD Pension Fund.

    FPD = Fire Protection District.

    A fire protection district is not a department within a municipality but rather a separate unit of government.

    A fire department is a department within a municipality.

    ++++++++++

    The problem with almost all public sector pensions in Illinois is a focus was not made to fund the pensions 100%.

    A focus was not made to consider pension funding status during collective bargaining negotiations and administrator contracts.

    So if one doesn’t consider the shortfall in the pension fund, there is more money for salary hikes during collective bargaining.

    Salary hikes worsen the pension shortfall.

    Over decades, that results in a huge compound interest and principal problem which is the responsibility of taxpayers.

    This was just one of the many games that were played with pensions, since the inception of the pensions, for almost all the public sector pensions in Illinois.

    As an analogy, what if an employer diverted some of the employer match 401k contribution to salary hikes, did this for decades, and stuck the taxpayers with the tab for the missing principal and interest 401k contributions given a predetermined interest rate.

    The employees didn’t care about the pension funding shortfall because the pensions cannot be diminished or impaired per one sentence added to a re-written Illinois State constitution that was approved by voters on December 15, 1970.

    Well there’s only so much money to go around.

    More money to property taxes, and maybe your house appreciates less in value, compared to other states.

    That is happening in Illinois.

    So then maybe more people move out of the state than move into the state.

    That is happening in Illinois.

    etc. etc. etc.

    ++++++++

    Lake in the Hills Police current salaries as of the December 31, 2018 annual statement

    Name – Creditable Service – Current Salaries

    Brian Anderson – 4 years – $75,536

    John Arient – 4 years – $75,536

    Sarah Barham – 1 year – $70,736

    William Berens – 11 years – $94,739

    Patrick Boulden (Deputy Chief) – 23 years – $127,443

    Michael Boyce (Sergeant) – 19 years – $108,370

    David Brey (Chief) – 26 years – $144,891

    Christina Busby – 19 years – $94,739

    Adam Carson – 16 years – $94,739

    Carlo Coduto – 17 years – $94,739

    Eric Decker (Sergeant) – 26 years – $108,370

    Tiffany Decker – 11 years – $94,739

    David DeStefano – 0 years – $56,332

    Michael Domagala – 14 years – $94,739

    Jason Draftz – 11 years – $94,739

    Sean Feely – 15 years – $94,739

    Donald Fowler (Sergeant) – 25 years – $108,370

    Mary Frake (Deputy Chief) – 24 years – $127,443

    Michael Gnuechtel – 7 years – $88,939

    Lloyd Howlen Jr (Sergeant) – 17 years – $108,370

    Andrew Klem – 11 years – $94,739

    Eric Lee – 5 years – $80,337

    Amanda Lewis – 2 years – $65,935

    Jason Lira – 17 years – $94,739

    Andrew Mannino – 5 years – $89,939

    Matthew Mannino (Sergeant) – 12 years – $104,793

    Christopher Miller (Sergeant) – 18 years – $105,742

    Jeffrey Novak – 15 years – $94,739

    James Recchia – 17 years – $94,739

    James Riffe – 14 years – $94,739

    Amanda Schmitt – 4 years – $85,138

    Bradley Schumacher – 1 year – $61,133

    Jack Scurte – 14 years – $94,739

    Joseph Simms – 17 years – $94,739

    Randy Story (Sergeant) – 24 years – $108,370

    Erik Watters – 14 years – $94,739

    Larry Wright – 26 years – $94,739

    Louis Zenaty – 18 years – $94,739

    ++++++++++

    The pensions are in the same document.

    ++++++++++

    Are they underpaid, overpaid, or paid just right?

    One has to understand the big picture, not just the salary.

    One point regarding pay is the figures listed above do not include the employer contribution to the underfunded pension fund, which is significant.

    The employer contribution to the pension fund can be found in the City’s Audited Annual Financial Report, sometimes called an audit report.

    The main problem is the games that were played that resulted in the taxpayer debt, and pay and pensions are factors in that equation.

    Live within your means is not practiced in most of Illinois government.

    Many of the union rank and file do not know what transpired, because the union higher ups do not tell the rank and file.

    There’s much more to the story.

    Part of the Illinois Pension Scam.

  4. Lake in the Hills Police pensions and disability as of the December 31, 2018 Illinois Department of Insurance (IDOI) annual statement.

    ++++++++++++++

    Name – Creditable Service – Accumulated Contributions – Retire Date – Salary Used – Original Benefit – Current Benefit

    Peter Albanese – 9 – $60,249 – 1/29/2013 – $85,612 – $42,806 – $42,806 (non duty disability)

    Adam Brey – 2 – $14,853 – 12/5/2008 – $56,784 – $28,392 – $28,392 (non duty disability)

    Alan Bokowski (Deputy Chief) – 26 – $115,126 – 8/3/2006 – $92,123 – $59,880 – $84,323

    David Demarais – 21 – $99,355 – 1/29/2010 (benefit started 2/23/2014) – $79,684 – $41,834 – $41,834

    Robert Harper (Sergeant) – 22 – $123,166 – 9/23/2012 – $92,248 – $50,736 – $59,966

    Lawrence Howell (Deputy Chief) – 23 – $90,365 – 8/24/2003 (benefit started 12/30/2005) – $86,819 – $49,921 – $70,605

    Robert Hughes (Sergeant) – 23 – $83,348 – 6/7/2003 – $72,030 – $46,819 – $66,484 (duty disability)

    Craig James – 14 – $79,826 – 3/12/2011 – $81,681 – $40,840 – $40,840 (non duty disability)

    Lee Lathrop – 8 – $47,631 – 3/23/2010 – $79,684 – $51,795 – $51,795 (duty disability)

    Mark Morgan (Sergeant) – 23 – $157,712 – 8/10/2017 – $106,246 – $61,091 – $61,091

    Robert Pierson – 7 – $39,117 – 2/5/2008 – $71,385 – $35,692 – $35,692 (non duty disability)

    Michael Shafer – 16 – $96,254 – 11/7/2012 – $85,300 – $42,650 – $49,048 (non duty disability)

    Douglas Schenk (Officer) – 26 – $151,289 – 1/30/2017 – $93,110 – $60,521 – $60,512 (QUILDRO alternate payee)

    Mark Smith (Sergeant) – 26 – $165,094 – 5/1/2016 – $104,208 – $67,735 – $67,735

    Paul Swanson (Lieutenant) – 8 – $14,156 – 1/31/1987 (benefit started 10/27/2009) – $25,341 – $5,068 – $6,612

    Terri Vollmer (Sergeant) – 27 – $158,308 – 6/30/2013 – $94,099 – $63,516 – $73,044

    James Wales (Chief) – 26 – $123,111 – 11/21/2004 – $99,216 – $64,490 – $96,767

    Thaddeus Ziarkowski (Sergeant) – 20 – $126,989 – 7/20/2014 – $100,131 – $50,065 – $56,349

  5. Village of Lake in the Hills

    Comprehensive Annual Financial Report (CAFR)

    Fiscal Year Ended December 31, 2018

    lith.org/finance

    ++++++++++++++

    Begin pdf page 77 of 154.

    Page 79.

    Total Pension Liability $40,228,262 (amount actuary calculates should be invested right now)

    Net Position $28,011,169 (amount that is invested right now)

    Net Pension Liability (unfunded liability) $12,217,093 (amount missing) (amount taxpayers owe)

    Percent funded (net position / total pension liability) 70%.

    +++++++

    How easy is it for Lake in the Hills to come up with $12 million dollars for its police pension fund?

    pdf page 43 shows village revenues for the fiscal year ended December 31, 2018:

    Property taxes – $6,125,282

    Sales taxes – $2,921,636

    Home rule sales tax – $1,927,663

    Use tax – $858,587

    Simplified Telecommunications tax – $454,644

    Utility tax – $1,372,683

    Other tax – $385,743

    Intergovernmental Income tax – $2,799,051

    Investment Income – $437,445

    Miscellaneous – $199,500

    Total – $17,482,804

    +++++++

    70% funded is a big problem.

    It should be 100% funded.

    70% funded means taxpayers owe a lot of principal and interest to the pension fund.

    If it was 100% funded, the taxpayers would owe not any principal and interest to the pension fund for an unfunded liability.

    ++++++++

    pdf page 78.

    “For the year ended December 31, 2018, the Village’s contribution was 43.15% of covered payroll.”

    That is a very large employer contribution.

    It consists of the “normal” cost which covers benefits accrued for the current year, plus an amount for the unfunded liability, which represents a portion of the benefits accrued in previous years that were not properly funded in previous years (and / or for which investments did not meet actuarial projections).

    As an analogy to the private sector, the max employer contribution to a 401k is 15% of pay.

    +++++++

    Jack Franks said during his campaign for McHenry County Board Chair that he was campaigning to reduce the property tax levy of every property taxing district in the county.

    Now that he has been in office for a few years, one would think he had ample time to release his plan.

    ++++++++

    McHenry Times

    Report: 80.7% of Lake in the Hills Police Pension Fund is funded.

    April 28, 2018

    That was as of 2016.

    Thus the funding status of the police pension fund has worsened, not improved.

    https://mchenrytimes.com/stories/511390751-report-80-7-of-lake-in-the-hills-police-pension-fund-is-funded

    ++++++++++

    Lake in the Hills also has an IMRF pension fund which covers most municipal employees that are not covered by the police pension fund.

    The IMRF fund is much better funded than the police pension fund, and is also covered in the CAFR.

    +++++++++

    The Village of Lake in the Hills does not post the annual Police Pension Fund Actuarial report on its website.

    One would have to request it or submit a FOIA request for it.

    That would be an important document for Lake in the Hills taxpayers and police pension fund members to obtain, especially since the pension is underfunded.

    The actuarial report is not required by law to be posted on the Village’s website.

    But how hard is it to post a document on a website?

    Not that difficult.

    So apparently Illinois needs a law requiring the actuarial documents of public sector pension funds be posted and left on taxing district websites (and not deleted after a few years, but indefinitely archived).

    That would be a good bill for a legislator to sponsor.

    Why is the Village not being transparent about an important document paid for by the taxpayers.

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