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News

Another Ruling Says Pension Set at Hire Can Be Cut
Source: PublicCEO

A second appeals court panel has unanimously ruled that the public pension offered at hire can be cut without an offsetting new benefit, broadening support for what pension reformers call a “game changer” if the state Supreme Court agrees.

The new ruling on Dec. 30 in a state firefighters suit on pension-boosting “airtime” purchases made several references to a groundbreaking ruling last summer in a Marin County pension “spiking” suit.

“The law is quite clear that they are entitled only to a ‘reasonable’ pension, not one providing fixed or definite benefits immune from modification or elimination by the governing body,” wrote Justice Martin Jenkins.

The two appeals court rulings are contrary to previous rulings known as the “California rule”: The pension offered at hire becomes a vested right, protected by contract law, that can only be cut if offset by a comparable new benefit, erasing any savings.

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IPPFA Regional Seminar – John A. Logan College – Caterville – Registration Now Open
Source: IPPFA

Come join the IPPFA for a regional seminar being held at John A. Logan College in Caterville Illinois.

For over 30 years, the IPPFA has offered public pension trustees the best and latest in trustee training education, striving to offer the best available training. Please join us for sessions in ethics, investment procedures, fiduciary responsibilities, and legal and legislative updates, all presented by nationally renowned speakers.

Register NOW

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Welcome North Riverside Fire Pension Fund to IPPFA
Source: IPPFA

Welcome North Riverside Fire Pension Fund to IPPFA.

 

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Massive state budget proposal appears
Source: Chicago Tribune

Senate lawmakers are meeting privately Monday afternoon to weigh a sweeping group of proposals designed to jump start stalled budget negotiations, including measures that would raise income taxes, expand gambling, hike the minimum wage and borrow billions of dollars to pay down government debt.

The effort comes at the start of a two-day lame duck session before a new legislature is sworn in Wednesday, meaning even if the proposals are approved by the Senate, the House wouldn’t have time to take action. But the approach is designed to get people talking after negotiations between Republican Gov. Bruce Rauner and Democratic House Speaker Michael Madigan broke down in December, just before a stopgap budget that funneled money to universities and social service providers expired with the new year.

Other proposals include an overhaul the state’s public employee pension system, consolidation of local units of government and a change in rules for how schools do contracts with outside vendors. The package would also include funding for universities and social service providers, which dried up Jan. 1. Efforts to overhaul the workers compensation system and freeze property taxes still had not been written into a bill as of early Monday afternoon, but those are key issues Rauner and Republicans have pushed for.

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Beware the siren call of ‘pension reform’
Source: IMRF Louis Kosiba

There continues to be a call for pension reform at the state level and for the City of Chicago and Cook County. As the executive director of the Illinois Municipal Retirement Fund, I think that is misleading. Let me explain.

This year marked the 75th anniversary of IMRF, which provides death, disability and retirement benefits for some of your neighbors, friends and possibly family who work in local government at town halls, libraries, park districts and schools. We do not cover city of Chicago employees or those of Cook County. We do not cover teachers in school districts, but rather the support personnel who create and maintain the physical learning environment.

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State & Local Pension Reform Since the Financial Crisis
Source: CRR Brief

The Center for Retirement Research brief’s key findings are:

  • Since the financial crisis, 74 percent of state plans and 57 percent of large local plans have cut benefits or raised employee contributions to curb rising costs.
  • Plans with a larger pension cost burden and lower initial employee contributions were more likely to enact such changes.
  • And, among plans that made changes, those in states with the strongest legal protections for current workers were more likely to limit the cuts to new hires.

This brief is available here.

 

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Welcome Burnham Police Pension Fund to IPPFA
Source: IPPFA

Welcome Burnham Police Pension Fund to IPPFA.

 

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2016 Keynote Speaker General John Kelly now head of Homeland Security
Source: IPPFA Newsletter

Donald Trump has picked former Marine Corps General John Kelly to run the Department of Homeland Security.  General Kelly was the Keynote Speaker at the 2016 IPPFA MidAmerican Conference.

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This one is going to hurt: Dallas police & fire pension issue is unfair
Source: Dallas News

I’ve spent countless hours the last three-plus years talking to cops and firefighters at all hours about their complaints, their working conditions and their daily lives. That short text exchange July 7 will be the one conversation that will always stick with me.

A few days after the shooting, a colleague and I walked around the perimeter of the crime scene that was downtown Dallas. We struggled to envision what life would possibly be like now. I wondered the same thing later that day when I sat in the Dallas Police Association office with members of its shell-shocked leadership while they struggled to find meaning in all of it.

But somehow, it wasn’t the tragic loss of five first responders’ lives that defined the second half of my year. It was the possible loss of the pensions of those who remain.

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Public pension funded ratio rises to 71.0% in Q3
Source: Millman

The estimated funded status of the 100 largest U.S. public pension plans improved by $48 billion from the end of June through the end of September as measured by the Milliman 100 Public Pension Funding Index (PPFI).1 The deficit fell to $1.338 trillion due to asset returns that outpaced their expected targets for the quarter. As of September 30, the funded ratio increased to 71.0%, up from 69.8% at the end of June.

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