Public Watchdog.org

Pension Funding Newest Variety Of Budget Gibberish

02.22.11

Only four aldermen showed up at Saturday’s Park Ridge City Council budget workshop, which was the minimum attendance for a quorum.  Alds. Allegretti, Bach and Carey were MIA, as they have been for most of the other budget workshops this year.

SIDEBAR: Those three should have the decency to abstain from voting on the budget due to their manifest disinterest and likely ignorance resulting therefrom, but we aren’t going to hold our collective breath waiting for that to happen.  It should be pretty clear to you folks in the 3rd, 4th and 6th wards, however, that you aren’t even getting your $100/month worth out of these three when it comes to perhaps the single most important thing an alderman does each year: adopt a budget.

We doubt, however, that the “ABC” aldermen could have added any enlightenment to Saturday morning’s process, which you can witness for yourself by dialing up the video on the City’s website. Even a few minutes of viewing should show you why the City’s finances are screwed up and unlikely to get better anytime soon, unless the public officials representing us start bringing their “A” games to these proceedings and to their preparations for these proceedings.

Perhaps the most troubling vignette in that regard was when the Firefighter’s Pension Fund secretary, J.D. Bruchsaler, took to the podium to explain why the City shouldn’t have to budget the approximately $900,000 of pension contributions this upcoming budget year that the fund’s own actuary apparently prescribed in his November 2010 report.

Not surprisingly, City Mgr. Jim Hock has left that contribution out of his proposed 2011-12 budget even though nobody seems to be ready, willing and able to guaranty that such an omission is fiscally prudent for the pension fund or for the City.  What we do know, however, is that not having to deal with an additional $900,000 in the expense column make’s Hock’s job of balancing the budget quite a bit easier.

To the best of our ability to follow Bruchsaler’s bizarre discussion with the Council (which begins around 3-1/2 minutes into the video), he claims the City can ignore the $900,000 contribution prescribed by the pension fund’s actuary because a change in the law might, repeat “might,” result in a lower current contribution requirement when the actuary issues his next report…in  November 2011.

In other words, the City is supposed to budget its firefighter pension fund contributions based not on what it has been told it owes by the fund’s actuary but what it’s being told it might/will be told by the actuary next November – assuming the law doesn’t change between now and then.

Both Alds. Joe Sweeney and Frank Wsol were unimpressed by Bruchsaler’s arguments, with Wsol going so far as to suggest the aldermen need an opinion letter from the City Attorney exculpating them from any liability if they follow the  go ahead and not make that recommended $900,000 contribution this year.

But the most telling aspect of Bruchsaler’s relatively brief presentation is how loaded it is with words like “guess,” “estimate,” “believe” and “expect”; phrases like “don’t know” and “can’t say for sure”; and a variety of seemingly-random percentages and dollar amounts tossed around for no apparent reason other than to create confusion, which it does quite well.  One other thing: Bruchsaler keeps repeating actuary Timothy Sharp’s name as if doing so might magically ward off all the questions he clearly had no ability to answer.

Expect this $900,000 pension contribution to be a key battleground for the remainder of this budget debate, with Hock and a majority of the current (and outgoing) aldermen trying to avoid making it so that they also can avoid the heavy lifting of further budget cuts and/or tax increases that such a contribution this year will cause.

Given the underfunding of Illinois public pensions we keep hearing about, we believe that the prudent thing to do would be to make the 2011-12 contribution as prescribed by the fund’s actuary just a few months ago.  If we end up finding that the law would have permitted the lower contribution this year, that should set the stage for a lower-than-expected contribution next year.

But don’t expect Hock and this Council to do something that fiscally responsible and logical.  Not when it can kick the can down the road and avoid having to make any more tough budget cuts or tax increases for at least another year. 

And, oh yeah: not making that $900,000 pension fund contribution makes it easier for the current Council to make another year’s worth of arbitrary donations of public funds to certain aldermen’s favorite private community groups.

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