Springfield, IL…A major step for pension reform was accomplished today after the IL House voted 96-14-3 to pass pension fund consolidation for downstate and suburban municipal pensions.
Assistant Republican Leader C.D. Davidsmeyer (R-Jacksonville) supported Senate Bill 1300 because small pension funds will gain greater value while keeping their independence. Please attribute the following statement to Rep. Davidsmeyer.
“The State IS NOT taking over individual pension funds. The State CANNOT sweep funds that are designated to individual police and fire pensions. Funds will remain their own and be ran by elected pension members, retirees and cities. All decisions on disability will also remain with the local boards.
“The new Police Pension and Fire Pension will operate much like the Illinois Municipal Retirement Fund (IMRF). IMRF is the best funded pension system in the state because it is outside of the purview of the state and requires local governments to fund it based on outside actuarial science, rather than the actuary of their choice. The new Police Pension and Fire Pension will ensure that they are being funded in the same manner.
“Each municipal fund will remain separate. This will operate much like a company’s 401(k), where all employee funds are combined, yet the employee maintains all of their money and any returns from their money.
“Well-funded pensions are not being used to fund the poorly-funded pensions.
“As a larger investment fund, they will be allowed to make better investments and will get better returns. I have great concern about rising municipal property taxes, which are driven mostly by local pensions.
“This bill provides an opportunity to get greater returns, slow the growth of property taxes, and ensure that the State of Illinois CANNOT sweep or under-fund this pension because they have nothing to do with it.