Title
title
Review and Discussion of the Police and Fire Pension Actuarial Reports in Preparation for the Fiscal Year 2026 Budget and Property Tax Levy
..end
Introduction
overview
This is the first meeting in a series of meetings the Village schedules annually to prepare for the next fiscal year’s budget. Each year, the Village reviews the actuarial valuations for the Police and Fire pension funds. The Police and Fire Pension Boards are also invited to participate in this conversation.
end
body
Recommended Action
There is no recommended action; this item is a report only.
Prior Board Action
There is no prior Board action associated with this specific item.
Background
Chapter 2 of the Municipal Code establishes the foundation for the Municipal Budget and provides:
• The Village fiscal year is January 1 - December 31 annually.
• The Board of Trustees must adopt the annual budget prior to the start of the Fiscal Year, and the passage of the annual budget shall be in lieu of the passage of the appropriation ordinance.
• On or before the Village Board of Trustees' first regular meeting in November of each year, the Village Manager shall submit to the Board of Trustees an annual Municipal budget which contains estimates of revenues together with recommended expenditures in conformity with good fiscal management practice.
• The Village of Oak Park, pursuant to Sections 9-1-3 and 19-1-3 Municipal Code, has established the Firefighters Pension Fund and Police Pension Fund as required by state statute.
• A property tax levy is the sole source of funding for the Police Pension and the Firefighters’ Pension Funds. The Village has a contract with Lauterbach & Amen, a certified public accounting firm with a separate actuarial division, to prepare the two public safety pension actuarial valuations for the Village. Although the Fire and Police Pension Boards may hire their own firms to prepare a valuation and recommend an annual pension contribution, both pension boards have agreed to use L&A as contracted by the Village for this purpose.
• This meeting is a discussion of Lauterbach & Amen’s (L&A) police and firefighters’ actuarial valuations.
• In the current FY25 (levy year 2024) budget, the public safety pension levies are approximately $14.5 million of the total $38.4 million levy (approximately 38%).
• The recommended contributions for the Police and Firefighters’ pension will be 100% funded by the property tax, typically approved by the Village Board in December.
• A tax levy in December 2025 based on the 12/31/2024 Actuarial Funding Report will determine the municipal contributions to the Pension Fund for 1/1/2026 through 12/31/2026.
• Compared to current FY25, the FY24 police levy recommendation is increasing by $637,159, from $7,639,547, to $8,276,706, while the fire pension levy is increasing by $660,561 from $6,813,643 to $7,474,204. The combined total recommended levy increase is $1,297,720 compared to the prior year.
• Pages 5 through 12 of the actuarial valuations explain and summarize the primary reasons for the recommended contribution increases.
• Please note that although neither pension fund board has formally submitted its levy request for FY26, it is anticipated that each will request the amount recommended by L&A. Each pension fund board meets quarterly, and the actuarial valuations are typically an item placed on their meeting agenda for discussion and review.
• The pension boards were also provided the option to request that L&A attend one of their quarterly meetings for a thorough presentation and the opportunity for pension board members to ask questions. Pension board members may also attend the L&A presentation to the Village Board tonight to observe and participate as needed in the discussion.
Timing Considerations
There are no specific timing considerations associated with this item.
Budget Impact
There is no budget impact associated with this item.
Staffing Impact
There is no staffing impact associated with this item. The item aligns with the department’s core service delivery.
DEI Impact
There is no DEI impact associated with this item.
Community Input
There has been no community input given in relation to this item.
Staff Recommendation
Staff recommends accepting the reports at a future Board meeting.
Alternatives
There are no alternatives associated with this item.
Anticipated Future Actions
There are no anticipated future actions concerning this item.
Prepared By: Donna M. Gayden, Interim Chief Financial Officer
Reviewed By: Ahmad M. Zayyad, Deputy Village Manager
Approved By: Kevin J. Jackson, Village Manager
Attachment(s):
1. Oak Park Police Pension Fund - Funding Actuarial Valuation as of January 1, 2025
2. Oak Park Fire Pension Fund - Funding Actuarial Valuation as of January 1, 2025
3. Oak Park Fire GASB 67&68 Actuarial Report as of January 1, 2025
4. Oak Park Police GASB 67&68 Actuarial Report as of January 1, 2025
5. Oak Park GASB 74&75 Actuary Report as of January 1, 2025
6. Village of Oak Park 4.30.2025 Fire & Police Pension Actuarial Presentation