NEWS
from the Illinois Senate
State Senator Susan Garrett
FOR IMMEDIATE RELEASE
September 4, 2008
FOR MORE INFORMATION
Susan Garrett (847) 433-2002
Ronald Holmes (217) 782-3124
NEW LAW PROVIDES PENSION REFORMS
Garrett announces new law which reforms state retirement systems and pensions.
HIGHWOOD, IL— State Senator Susan Garrett (D – Lake Forest) announced the signing of a new law, which makes major reforms to municipal pensions across the state.
House Bill 5088 requires that the State Pension Fund be used for the funding of unfunded liabilities of the five state-funded (Teachers, State University, State Employees, Judges and General Assembly) retirement systems. In the past, these funds were used as a part of the fiscal year's contribution but under new law they will be used in addition to any FY contribution, thus paying down liabilities rather than merely making a payment.
The legislation also provides major ethics reforms to Downstate Police and Fire Pension Funds by strengthening and standardizing requirements for those seeking consulting contracts for these funds. The reforms also prohibit consultants from knowingly advising a fund to engage in an investment which would result in the consultant benefiting financially. The measure additionally forbids any fund employee from receiving gifts from those doing business with the fund. Violations of these measures would result in fines and possible jail time.
“I sponsored this measure and believe that all parties (municipalities, police and firefighters) have struck the right balance and this is a win-win for all,” Garrett said.
“The Associated Fire Fighters of Illinois share Senator Garrett's gratification over the enactment of this legislation,” said Pat Devaney, AFFI president.
“Our association has worked closely with Senator Garrett to enact meaningful reform for public safety pensions in general, and for downstate fire fighters in particular. House Bill 5088 represents a good faith effort on the part of the fire fighters and the General Assembly to work toward long-term security for taxpayers and fire fighters alike.”
Additionally, the firefighters will be able to have an independent audit of the contributions made on behalf of their pensions. The bill also grants the Commission on Government Forecasting & Accountability the ability to determine cost on multiple municipalities for pension impacts on local taxpayers.
“Throughout the last decade, lawmakers have made some improvements to firefighter and police pension funds, and that has helped guarantee the security of our first responders. However, legislation has also allowed some local governments to defer pension obligations through no fault of their own,” said Garrett who is chief co-sponsor of the bill. “This legislation gives everyone a chance to stand back, take a deep breath and get a good look at what the impact of the General Assembly’s actions has been and to work toward long-term reform. Even the parties that stand to benefit from these measures, like the Associated Firefighters of Illinois, agree that we need to know what the financial impact is going to be to our municipalities and, ultimately, to our taxpayers.”