Julie Schmidt
Julie Schmidt
In 2014, the average Elgin police officer earned $95,584 in salary and an additional $60,682 in taxpayer-funded pension contribution for a total of $156,266 in compensation, according to a report published by the Illinois Department of Insurance.
The 2015 Biennial Report reports on the financial health of all state and municipal pension funds, including the Elgin Police Pension Fund, which as of Dec. 31, 2014, was underfunded by 54 percent, or $99.79 million.
That financial burden falls upon Elgin property taxpayers. The median household income in Elgin is $58,675, according to the U.S. Census.
"In any city across Illinois, the largest challenge is funding (public employee) pensions," said Julie Schmidt, a 25-year Elgin resident who ran unsuccessfully for city council last spring. "Its a tremendous burden."
For every dollar Elgin city police employees contribute to the police pension fund, taxpayers contribute approximately $5. And with every passing year, that number increases.
Ten years ago, when the Elgin Police Pension Fund had a deficit of $49.6 million, or half what it is today.
That split has since changed dramatically.
Today, Elgin property taxpayers now directly fund 83% of police retirement contributions. They contributed approximately $10.5 million to police retirements in 2014, or $5,057 per month for each of the police department’s 173 employees.
The employees themselves contributed only $2.1 million towards their own retirements, or $1,017 per month.
Fully-funding the Elgin Police Pension fund’s deficit with taxes would an additional $90 million, quadrupling current city property taxes.
Schmidt says local governments need to switch from defined benefit to defined contribution pension systems, standard in the private sector. Such a switch would require local government employees to save for their own retirements; today, they rely on taxpayers to fund them.
“This isn’t a matter of anything but math,” Schmidt said. “Every year, it continues to grow and grow, but we can still recover.”
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