Gov. J.B. Pritzker signed legislation on Wednesday that consolidates the 649 downstate and suburban Illinois public safety pension funds.
Pritzker in a statement praises the bipartisan measure that he says will help “alleviate… spiraling property tax burdens.”
The idea is by consolidating the municipality’s pension funds into two funds; one for firefighters and another for police, the pensions can yield greater returns with less administrative costs.
Municipal leaders in Galesburg, Monmouth and other Illinois towns, local and distant, had voiced support for this move.
Galesburg City Manager Todd Thompson said in 2018 that Galesburg’s liabilities had been increasing in recent years.
But that’s not because of underfunding, but because of returns at 4 percent, trailing state and actuary assumptions.
Municipal public safety pensions were limited in how much they could invest in higher risk but higher-yielding financial assets.
The bill did receive some bipartisan support but Republican Representative Norine Hammond was opposed.
She felt the bill was rushed and didn’t necessarily deal with the problems at the root of Illinois’ pension crisis.
The idea of getting better returns on local pension funds would free up municipalities to either spend funds on other areas or lower property taxes.
But Hammond says nothing specifically about lower property taxes was written into the bill, which concerns her.
Ultimately, the bill was endorsed by the Illinois Municipal League, the Illinois Fraternal Order of Police and the Associated Firefighters of Illinois.
