Other Towns 'Steal' Pension Cash: Burr Ridge Official

BURR RIDGE, IL – A Burr Ridge trustee last week noted the village's relatively good position with its police pension account compared to other towns.

"These other places steal the money from their pension account," Trustee Al Paveza said at a Village Board meeting. "I guess it's the way you run the village because we have the same amount of money percentage-wise that they do."

Paveza did not indicate what he meant by how the other towns "steal" the money. He may have meant that municipalities transfer money out of their pension accounts to other funds such as general purposes or utilities.

But in Illinois, once money is put into the pension fund, it cannot be used for other purposes. In other words, it would be illegal to transfer, or "steal," money from a pension fund.

Paveza also did not say what he meant when he said other towns get the same money percentage-wise.

Police pension money comes from three sources – member contributions, investment earnings and taxpayer contributions.

When Paveza speaks about what Burr Ridge invests in pensions, he was referring to taxpayer contributions.

Burr Ridge is a wealthy town with expensive residential and commercial properties to tax. Other towns have nowhere near the property value from which to tax.

For example, Streator in downstate La Salle County maintains a police pension account that is far less funded than Burr Ridge's.

While the populations of the two towns are similar, Burr Ridge's property tax base is 12 times Streator's, according to state records. That gives Burr Ridge a large inherent advantage over Streator to fund police pensions.

Asked about his comments, Paveza said in an email, "Many towns and villages are in the 50% and low 60% (funding range for pensions). Check the State and Chicago pension problems."