One of the East St. Louis fire houses was closed by city leaders and nine firefighters were given notice of layoff letters on Tuesday. […]
The city had fallen more than $2.2 million behind in contributions to the firefighter’s pension fund. The Fire Pension Board voted in September to initiate the “intercept process,” which allows Illinois Comptroller Susana Mendoza’s office to take money that would otherwise have been spent on things such as payroll, public safety and sanitation, and deposit it directly toward the under-funded retirement benefits. […]
Its Police Pension Board also has applied for a revenue intercept to recover a $1.79 million shortfall in its benefits fund. […]
“Unfortunately, with 100 percent of the city’s revenues being redirected to the police and fire pensions, we are faced with the difficult task of strategically reducing some services in order to meet our financial obligations for the next few months,” [East St. Louis City Manager Brooke Smith] said.
* East St. Louis is a clear outlier, but it’s a prime example why local governments had to be forced by the state to stop ignoring their funding obligations…
The firefighters pension was only 9% funded at the end of 2018, with an unfunded liability of $65.2 million, according to data from the Illinois Department of Insurance. The police pension was healthier, but still had only 31% of its needed funds and a total pension debt of $39 million.
The firefighters’ union contract ended in 2015, and the union and city have not come to terms on a new one. However, the old agreement, which both the city and union still honor, says the city must maintain 58 firefighters.
A memorandum agreement passed in 2015 allowed the department to reduce staff by 25%, but that memorandum expired in 2016.
“Layoffs are not going to be financially beneficial to the city because either way they’ll have to pay the money back because of the contract,” said Gregory, who was one of 11 firefighters rehired from a layoff after the city received a federal grant in 2011. “If you’re going to pay us you might as well have a firefighter on duty.