Actuary backs cut in public safety pension payments
Evanston aldermen tonight will get an actuary's report that calls for setting less money aside for fire and police pension fund payments next year.
The recommendation calls for providing $14.2 million for the pensions next year, down from $14.9 million this year.
Under the recommendation, the funded ratio for each of the pension funds would decline slightly -- from 45.7 percent to 45.6 percent for the police fund and from 45.6 percent to 45.3 percent for the firefighters.
That would appear to fly in the face of the city's goal of increasing its pension funding level -- possibly to as much as 90 percent by 2040.
The state in 2010 changed the rules for pension fund accounting, and under those rules the city could make payments of as little at $10.4 next year, according to the actuary's report.
But representatives of the fire and police pension funds refused to agree to thosed funding recommendations -- saying they would dramatically increase the shortfall in funding for the pensions.
City staff is recommending that the aldermen adopt the $14.2 million funding level, which would result in a 1.6 percent reduction in the projected city property tax levy for next year.
The actuary's report assumes that pension investments will earn on average a 7 percent return in future years and that public safety wages will increase 2.5 percent per year.