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Motion to discuss Long-Term Police and Fire Pension Funding Strategy and Firefighters' Pension Plan Funding Analysis
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Introduction
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The Finance Committee will review the Village's current pension funding approach and the Firefighters' Pension Plan analysis prepared by Stifel to inform long-term pension, property tax levy, budget, and capital financing planning.
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Recommended Action
Receive the presentation and provide feedback and direction to staff regarding the Village's long-term pension funding objectives and the strategies that should be evaluated further. No final change to the pension funding policy, bond issuance, or supplemental pension contribution is being recommended for approval at this meeting.
Prior Board Action
There is no prior Board action associated with this item.
Background
Long-term pension funding is a core financial management priority for the Village. Trustees have previously requested that staff evaluate a more strategic, long-term approach to funding the Village's Police and Fire pension plans. The issue is particularly important because pension contributions are funded primarily through a dedicated property tax levy and therefore directly affect the Village's tax levy strategy, annual operating budget, long-range financial plan, capital improvement plan, and future borrowing capacity.
Illinois law requires municipal police and firefighter pension contributions to be at least sufficient to achieve a 90% funded ratio by 2040. The Village's current actuarially recommended funding approach is designed to amortize the unfunded liability to 100% by 2040. The Stifel analysis attached to this item uses the Village's 2025 draft Firefighters' Pension Plan actuarial report from Lauterbach & Amen and a 6.75% assumed investment return. The analysis has not been reviewed by the actuary and should be viewed as a planning and comparison tool rather than a final actuarial determination.
Based ...
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