CN November 14, 2013

Has Mayor Emanuel quietly hit on the pension reform formula that might work for him? Although the headlines said that pension reform failed yet again in Springfield last week, two things  point toward some quick movement in early December. First, legislators were told there will probably be a special session in the first week of next month, which just coincidentally is after the deadline for filing election petitions. So an unpopular vote will be less likely to be met with a primary challenge. But the second factor is a bill that makes a lot of changes to the Chicago Park District pension plan, including a later starting year (from 50 to 58), larger employee contributions, etc.

Kristen McQueary says the Tribune Editorial Board, for which she works, liked it.

“They passed a pension bill that includes a lot of the components that we think make good pension reform,” she says. “Raising retirement age, asking workers to pay more, guaranteeing that the Park District will actually pay in. It did come out of nowhere. Mike Madigan was the sponsor in the House, John Cullerton was the sponsor in the Senate. So Cullerton was sponsoring a bill that had major planks that he has previously declared unconstitutional over and over. So it was very bizzaro world.”

And WBEZ’s Alex Keefe says it may have been a small bill, but it has big implications.

“The question I have is what this could mean – depending on what Governor Quinn does – for Chicago’s pension crisis,” he explains. “We saw Rahm Emanuel try to push a bill through with the police sergeants’ union – a smaller union – in February, that kind of rhymed with some of the ideas in this bill. And the police sergeants’ union overwhelmingly rejected it.  If this Park District bill survives a legal challenge, which it sounds like could be an issue, what does this mean? Could it be the template they want to put on Chicago’s other pension funds?”

If that’s the game plan, the consequences could be pretty dramatic. “I’ve heard people inside the pension world say – we know the Mayor is trying to start small – pick off a smaller pension plan,” says Keefe. “Don’t deal with police, fire, Municipal workers yet, and see how this one goes.”

Police Department staffing levels remain a hot topic. An effort was made at the City Coumcil this week to allocate $25 million for the hiring of 500 additional officers. It went nowhere, and it didn’t get the support of the Tribune, either.

“We’ve been talking about staffing of the Police Department for 25 years,” says McQueary. “Even when we have more officers, it doesn’t do something more substantial over the long haul to decrease crime in some of the hot-spot areas of the city. And the other thing is, we are broke. Yes, I realize we’re spending a lot on overtime, but once you hire officers, then you’re talking about benefits packages, and eventually a pension for these officers, I think over the long haul it is more expensive.  And if you believe Superintendent McCarthy, we have more police per capita than other areas of the country as it stands now.”

Another often-discussed strategy for reducing crime and violence is the raising of mandatory minimum sentences for the illegal possession of a firearm. It didn’t make it through Springfield, but McQueary says it’s  still a good idea.

“If we do not crack down on unlawful carrying of loaded weapons, we’re going to continue to see these sorts of crimes,” she asserts. “Gang members know that juveniles can carry the weapon and they don’t get in trouble. We just have too many cases where people are charged with this crime and then they are not cracked down upon, and then they go out and commit another crime.”

We also take on the perennial topic of TIFs. There has been discussion in the City Council (but no action) about allocating surplus Tax Increment Financing funds to the schools. Keefe and his colleague Becky Vevea did a detailed explanation of how the tens of millions of surplus dollars is being divvied up, leaving only a small amount for schools.

The City seems willing to have this discussion, and all sides agree that the Emanuel administration is more transparent about how TIF money is spent. But the biggest portion of TIF money – probably close to a billion and a half – is what’s called “encumbered”. And the City is more reluctant to get specific about that number.  “What you can’t see is exactly what that encumbered number is, and what is it encumbered for?” McQueary asks. “What is this money waiting for? I want to know what contract or what contractor is waiting for that money. Show us every number. And they have not done that.”

Keefe says despite the good work Tax Increment Financing has done, it remains controversial.

“I talked to Rachel Weber of UIC,” he tells us. “The way she put it is that it’s good for targeted (projects), but Chicago has created this monster  whereby anytime that anybody wants money for anything, they go looking for TIF money. And Chicago has a lot of what they call area-wide, multi-purpose TIFs. And  what that basically means is instead of a TIF created to fund a single project – so instead of a project in search of a TIF, you have these TIFs that are just kind of open, they just kind of exist, in search of different projects. So they’re not targeted enough. And these are the findings of Mayor Emanuel’s TIF Task Force a few years ago.”

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About Ken

Ken's the host of Chicago Newsroom. A former news director, reporter and radio program host, he's also a past Vice President of the Chicago Headline Club.
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