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* North Riverside is filing suit to get out of its firefighters contract. From a press release…
Mayor Hubert Hermanek, Jr. of west suburban North Riverside, after yesterday announcing an impasse after six “good faith” negotiating sessions with Firefighters Union Local 2714, instructed the village’s attorneys to file suit today in Cook County Circuit Court asking that court to affirm North Riverside’s right to legally terminate the firefighters’ contract, which expired on April 30, 2014.
North Riverside, with a population of 6,672 in 2,827 households, derives most of its revenue from sales tax, thanks in large part to North Riverside Park Mall. However, the village is facing a proposed fiscal year 2014-2015 operating budget deficit of $1.9 million, with $1.8 million of this deficit being a direct result of the Village’s growing annual public pension obligation. All of this and more is evidence that supports the Village’s inability to sustain salary and benefits of over $200,000 per fireman and $230,000 per Lt. anymore.
Contracting firefighter services from Paramedic Services of Illinois (PSI), which has provided paramedic services to North Riverside for the past 28 years, would save the village more than $700,000 annually and vastly reduce the adverse impact of future pension obligations imposed by the state. All PSI paramedics are certified as firefighters, as well.
* From a September 10th press release…
The Village has presented multiple compromise proposals to the union, including a progressive privatization plan based on an 11-year contract, during which 10 of our 14 current firefighters would reach retirement age and 25+ years of service. As they retired or with any attrition, firefighters would be replaced with firefighters/paramedics from PSI-the private company that has provided paramedic services to North Riverside for 28 years. As a result, by the end of this 11-year contract, Village fire and emergency protection services would be almost fully privatized, maintaining safe and reliable service, while achieving the cost-savings the Village must have to remain solvent.
The union rejected this innovative proposal, which would have reduced our future public pension obligations over time and stabilized North Riverside’s finances, while allowing nearly 90 percent of our current firefighters to eventually retire with their full, earned public pensions.
* The village’s attorney also sent along this link…
San Bernardino can cancel a union contract with its firefighters, a federal judge said in a preliminary ruling that may make it easier for the insolvent California city to cut debt and exit bankruptcy.
U.S. Bankruptcy Judge Meredith Jury in Riverside, California, said today that she will give the firefighters’ lawyer a chance to question a key city witness before making her final ruling.
“It is very unlikely they are going to convince me” that the contract is not a burden on the city’s recovery, Jury said while making her initial ruling.
* Meanwhile…
Voters in Hinsdale Township High School District 86 will have the chance in November to weigh in on an advisory ballot question related to teacher pensions.
The board voted 4-3 Monday to place the following question on the Nov. 4 ballot: “Shall the Board of Education of Hinsdale Township High School District 86 continue to offer eligible teachers the opportunity to earn six percent (6 percent) salary increases in each of four (4) school years prior to retirement?”
Discuss.
posted by Rich Miller
Friday, Sep 12, 14 @ 12:56 pm
Sorry, comments are closed at this time.
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Is North Riverside in bankruptcy?
Comment by DuPage Bard Friday, Sep 12, 14 @ 1:09 pm
300K per Lt. have to say that number surprises me…
Comment by OneMan Friday, Sep 12, 14 @ 1:22 pm
$230,000 in salary and benefits for a lieutenant says it all. Regardless of seniority or cost of living, that’s a lot of money and a comfortable pension. Unsustainable.
Comment by Sir Reel Friday, Sep 12, 14 @ 1:23 pm
Knowing whether (and to what extent) the North Riverside proposal will impact the applicable ISO rating strike me as a key piece of information.
http://www.isogov.com/services/infrastructure/fire-protection.html
In other words, do the companies that issue homeowners insurance policies think this is a good idea?
Comment by Bill White Friday, Sep 12, 14 @ 1:24 pm
According to the Moody’s report earlier this week, we can expect to see more of this at the local level in Illinois during the near future, not less.
And even if the state pension law is approved, we remain in a world of hurt.
Speaking of which - anyone working on a backup plan for if and when that law is shot down by the Supremes? Didn’t think so.
Comment by Formerly Known As... Friday, Sep 12, 14 @ 1:24 pm
These are options.
They are not for everyone.
Good luck!
Comment by VanillaMan Friday, Sep 12, 14 @ 1:25 pm
“Shall the Board of Education of Hinsdale Township High School District 86 continue to offer eligible teachers the opportunity to earn six percent (6 percent) salary increases in each of four (4) school years prior to retirement?”
85% no?
Comment by Anonymous Friday, Sep 12, 14 @ 1:27 pm
FKA - “anyone working on a backup plan for if and when that law is shot down by the Supremes?”
How about 5-10 Chicago casinos and marijuana legalization? The alternative will be large property tax spikes or more privatization…
Comment by Anonymous Friday, Sep 12, 14 @ 1:30 pm
No one should express any surprise that property taxes are the biggest concern of residents. They don’t care who can offer relief, they just want it. There are a lot of towns in the same or worse shape than North Riverside with liabilities. This is why everyone should be at the bargaining table on Pension Reform. Winning could just as easily mean losing. Playing whack-a-mole with the ISC isn’t the best approach. Everyone needs to sit down with a pencil and eraser and do the math to make it work to satisfaction, if not desire.
Comment by A guy... Friday, Sep 12, 14 @ 1:35 pm
How will privatization help with state pensions? You can’t shed the obligation to existing employees and retirees. Tier 2 employees help with the future expenses but that’s decades in the future.
Comment by dupage dan Friday, Sep 12, 14 @ 1:39 pm
Not a bad approach for N. Riverside.
To the 6%, I think now is a great time to get rid of the incentive. The way things are going politically, you will not have to give anyone an incentive to retire.
Comment by JS Mill Friday, Sep 12, 14 @ 1:40 pm
Such a shame that our elected officials have put everyone in this terrible mess. They want to rip off retirees of their rightfully earned pensions, they want to cut income and cut future pensions for those still working. There is no one to blame for this dillema but those who played with the workers retirement savings and gave the money away to anyone/anything but them. We all need to remember those who created this and direct anger and blame on these people, not retirees or workers. And make sure it doesn’t happen in the future.
Comment by Anonymous Friday, Sep 12, 14 @ 1:43 pm
Read recently that TRS would be funded at 94% today if legislature had not taken holidays. Even better than the never skipped IMRF.
Comment by Anonymous Friday, Sep 12, 14 @ 1:45 pm
It can only go on for so long that taxpayers will be asked to pay higher and higher property taxes to fund these pensions before plans like this start to move forward. At some point offering public workers a 5% 401K match will be the way forward. Those who choose to contribute will still enjoy a very comfortable retirement.
Comment by Very Fed Up Friday, Sep 12, 14 @ 1:47 pm
“Is North Riverside in bankruptcy?”
—————–
The State of IL would have to pass enabling legislation to allow units of local government to file for bankruptcy. Has not done so currently.
There is a court case (per Rich) in federal district court regarding the municipality of Washington Park, IL and their attempt to file bankruptcy. Link: http://en.wikipedia.org/wiki/Washington_Park,_Illinois
Comment by Judgment Day Friday, Sep 12, 14 @ 1:48 pm
To be fair to N. Riverside officials, that 11-year contract does seem to be innovative.
As for the Hinsdale matter, how could they possibly still get on the November ballot this late? I thought they were certified.
Comment by LincolnLounger Friday, Sep 12, 14 @ 1:49 pm
401k for public employees
And add employer contribution for social security?
I thought for those who do not receive/pay into SS, like teachers, the 401k/social security payments would be much higher than the current pension fund.
Comment by Anonymous Friday, Sep 12, 14 @ 1:50 pm
Anonymous - yes, 945 funded, but schools, roads, social programs, healthcare etc. would have all had reduced spending those years and beyond. The so called “pension holiday” savings went to other programs and avoiding tax increases. What’s your point?
Comment by Bogart Friday, Sep 12, 14 @ 1:51 pm
sorry 945 should be 94%
Comment by Bogart Friday, Sep 12, 14 @ 1:52 pm
Just the beginning of the collapse of public employees unions and their outrageous salaries and benefits.
Comment by Apocalypse Now Friday, Sep 12, 14 @ 1:53 pm
Bogart, my point is, enjoy your roads courtesy of me.
Comment by Anonymous Friday, Sep 12, 14 @ 1:56 pm
The total payment to the pension is about 17% of the salary. That is state and district/teacher combined. Districts also have IMRF and SSI employees. The IMRF contribution varies from year to year, there is no funding shortfall for the pension fund because the state is not involved. I am not sure what pension system the firefighters are in, it sounds like it is self funded by the municipality and could be the reason for such high costs.
Comment by JS Mill Friday, Sep 12, 14 @ 1:57 pm
I just took some time to scroll through the actual North Riverside budget. It’s online at the municipal website.
With apologies to Mark Twain, claims of insolvency are being exaggerated.
Comment by Bill White Friday, Sep 12, 14 @ 2:00 pm
http://www.northriverside-il.org/dnr/annual_budget
Comment by Bill White Friday, Sep 12, 14 @ 2:01 pm
“Such a shame that our elected officials have put everyone in this terrible mess. They want to rip off retirees of their rightfully earned pensions, they want to cut income and cut future pensions for those still working. There is no one to blame for this dilemma but those who played with the workers retirement savings and gave the money away to anyone/anything but them. We all need to remember those who created this and direct anger and blame on these people, not retirees or workers. And make sure it doesn’t happen in the future.”
——————
That’s all nice and fine and dandy. But it wasn’t the Village of North Riverside who passed the terms of the pension plans. It was the Illinois legislature, in response to lobbying efforts by the firefighters.
The Village (and it’s taxpayers) just got stuck with paying/funding the bills. Nice deal for the firefighters if you can get it. Problem is that the police/firefighter retirement obligations have become unaffordable for places like North Riverside, and actually, quite a few other municipalities.
If you study some of the municipality financial statements, they now have to include pension data (including retirement funding requirements) for both police and fire. There’s a lot of municipalities that are considerably underfunded regarding police and fire retirement obligations.
It’s kind of interesting to me that everybody’s beating on local school districts for providing expanded retirement benefits to teachers and then having the state pay for those added expenses, with the result that the state of IL wants to ‘cost shift’ the teacher retirement amounts back to the local school districts.
But with both police and fire pensions, it’s just the opposite. The state of Illinois sets the retirement terms and conditions, and turns around and drops the funding requirements back into the hands of the local municipalities. Not the state’s problem, it’s the municipalities problem.
Interesting how that works……
Comment by Judgment Day Friday, Sep 12, 14 @ 2:04 pm
== claims of insolvency are being exaggerated ==
How so? Seeing as you have reviewed the budget and others have not, what specific changes or cuts catch your eye?
I am not saying potential cuts do not exist, I am just curious as to what makes you say with such certainty they are exaggerating.
fwiw, I hope they do find a way to fulfill their pension obligations. And I do hope the state’s pension reform law is overturned.
Comment by Formerly Known As... Friday, Sep 12, 14 @ 2:09 pm
Fire Pension in N. Riverside funded at 45%, Police Pension funded at “mid 40’s”. Looks like the Police pension is an even bigger issue/cost driver. I think Bruce Rauner knows a guy that can privatize their Police Department for them.
Comment by JS Mill Friday, Sep 12, 14 @ 2:13 pm
The local suburban fire protection districts have been leading their communities to disaster for years now. They’ve been corrupt patronage havens in many communities that had a few dollars.
Orland Park is perhaps the best example of this overpriced dysfunction. You may remember that they had a fire fighter get a paid leave to serve in Iraq. He was in the military reserves, but his “military leave” was not to serve in the US military, but to work as a contractor for a private security firm there, while taking taxpayer leave money. They had two other firefighters on medical leave who claimed they couldn’t even do desk work so they needed to remain home with full pay. They didn’t quit their “moonlighting” job however….AS PROFESSIONAL WRESTLERS!
I greatly appreciate those who risk their lives to save and protect others, but at some point we need to pay fair compensation and end the culture of patronage and entitlement found in unionized fire departments.
It’s tragic that fire departments need to be disbanded and privatized because of unsustainable union demands, but perhaps the North Riverside situation is the only solution.
It’s time for Springfield to legislate to put the breaks on this unsustainable labor issue before it breaks the departments themselves.
Comment by Arizona Bob Friday, Sep 12, 14 @ 2:39 pm
That is a lot of money to spend for 2305 calls in 2012.
http://www.northriverside-il.org/dnr/activity-breakdown
They should consider merging with their neighbors into a larger fire protection district to take advantage of economies of scale.
Comment by Jake From Elwood Friday, Sep 12, 14 @ 2:50 pm
“Shall the Board of Education of Hinsdale Township High School District 86 continue to offer eligible teachers the opportunity to earn six percent (6 percent) salary increases in each of four (4) school years prior to retirement?”
Just another attempt to defraud the pension system.
Comment by john doe Friday, Sep 12, 14 @ 3:27 pm
Since 2008, North Riverside has struggled to pay anything toward its pension contributions. The notice of noncompliance points out that between 2009 and 2012, North Riverside paid just $100,000 of the $2,052,502 it was required to pay into its fire pension fund.
In addition, the village from 2008 through 2012 paid just $631,422 of the $3,824,374 it was required to contribute to its police pension fund.
Read it here-http://www.rblandmark.com/News/Articles/4-2-2013/State-warns-North-Riverside-on-pensions/
Comment by Wake Up! Friday, Sep 12, 14 @ 3:39 pm