EDITORIAL: One way to ease Illinois property taxes? Read on.

May 15-- May 15--Examine the property tax bill of just about any Illinois taxpayer, and you'll see most of the money goes to the schools. But a close second place? Police and firefighter pensions.

Across Illinois, those pensions are gobbling up a greater share of local property tax revenue. Yet many of those pension funds are in trouble with rising unfunded liabilities, more workers retired than active, and investment returns that aren't reaching their full potential.

Help could be on the way if state officials get serious about streamlining Illinois' huge roster of pension funds -- and if they're willing to tangle with organized labor. Lawmakers can pass legislation that, if signed by Gov. J.B. Pritzker, would allow consolidation of the more than 650 boards overseeing individual police and firefighter pension funds around the state. Fewer boards, along with pooled investments, would centralize pension oversight and increase the potential for greater returns. That would ease financial pressure on property taxpayers who make up the difference when funds don't perform well.

That structure already is working for systems such as the Illinois Municipal Retirement System, the statewide retirement system covering municipal government workers outside Chicago. IMRF is one of the most stable and well-funded pension systems in the state. Police and fire pension boards should work to emulate it. Especially in communities that share some resources already -- think La Grange and La Grange Park, or Barrington and South Barrington, or Peoria and Peoria Heights -- consolidation should be an option.

The Illinois Municipal League is backing nearly a dozen bills this year with various options to deliver consolidation. Pritzker appointed a task force to study the idea; its findings are expected soon. The proposals on the table would leave Chicago's police and fire pension funds separate from the statewide structure. That's how the statewide pension fund for teachers outside Chicago operates.

While consolidating the boards and centralizing the investments would not solve the pension crisis that looms large over Illinois, it would provide a relief valve for local governments that have been begging for help. Property taxpayers are fed up and they're leaving Illinois. And let's face it, the current setup with hyperlocal boards that pay for their own investment advisers, their own audits, their own accountants, their own training fees, is expensive for many cities, towns and villages.

Opponents are pushing scare tactics, claiming that currently well-managed pension funds would be taking on the burdens of badly managed ones. But the system would work like IMRF. Each town's local pension funds would be protected. But the overall system would be stronger due to higher investment returns and lower total overhead costs.

"From my perspective as a village manager, during the last seven years -- if not for our public safety fund increase -- our levy would be flat. We wouldn't have had to increase the village portion of the tax bill at all," says Jim Norris, village manager for Hoffman Estates. According to 2017 figures, the police pension fund in Hoffman Estates is about 64% funded and the fire pension fund is about 72% funded. Had the village been using a system similar to IMRF, the police fund would be 89% funded and the fire fund would be 102% funded. That's relief for taxpayers that's not being realized.

Organized labor has resisted the idea of consolidation. State law currently requires local pension boards to include union representation. That provision could remain with a centralized board. But the status quo on local public safety pensions is not sustainable. You can ask any village official. Or simply watch fed-up property taxpayers continue to load up their moving vans.

Choose change, lawmakers.

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