2021/08/16 - Mayor's Column: State Pension Debt
“An Open Door to O’Fallon”
A Weekly Note from Mayor Herb Roach
We have heard for years that Illinois has one of the worst, if not the worst, State Pension debts and overall debts of any of the states. But who is impacted by this debt and how does it impact communities across the State?
During the last 16 years, cities have paid ever increasing more dollars to State Pension costs. This means that you, the taxpayer, are paying more toward this. But the shortfalls have not gone down. Just the opposite, they have continued to grow.
To try to show you what this means, we will look at some of the most recent data. In 2003, 7 of the 175 largest cities received an “F” rating on a scale of A to F. In 2019, that number grew to 102. This has impacted Cities of all sizes. For example, Peoria, with a population of over 100,000, was the worst-off of the 20 largest cities (excluding Chicago).
112 of Illinois’ 175 largest cities now have more pension beneficiaries than they have active workers. In many cases, pension costs as a share of city budgets have doubled, increasingly crowding out core government services.
One local city has cut their police force in half since 2003 to reduce costs and has seen their crime statistics rise sharply in the recent years. They are not alone; similar things have occurred in other communities across the state.
Here in our local area of Madison and St. Clair Counties - 4 out of the 7 cities with populations over 20,000 have received an “F” rating on their pension funding. These same 4 cities are also below the 50% funded ratio on both their Police and Firefighters Pensions.
You should be glad to know that O’Fallon is not one of those 4 cities. You should also know that unlike many cities around us, O’Fallon does not offer any pension benefits to any of our elected officials. The Council voted to stop offering this years ago.
The State is not making it any easier on cities. During the past legislative session, they passed over 120 new unfunded mandates on local cities. All of this makes it more challenging for Cities to control expenses and taxes while still maintaining services.
As residents of O’Fallon, you should always be able to reach out to your elected officials and ask questions about what is happening in O’Fallon. Having open communications is important to me and something I care very deeply about. Thank you for reading, and please remember, my door is always open!