ACTION REQUESTED:
Title
Communication from the City Manager and Finance Director with a Request to ADOPT an ORDINANCE Extending ARTICLE XVIII, of ARTICLE 18 (Licenses and Miscellaneous Business Regulations) of the CODE of the City of Peoria, Pertaining to the PUBLIC SAFETY PENSION FEE.
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BACKGROUND:
Articles 3 and 4 of the Illinois Pension Code cover pension funds for police officers and firefighters, respectively, employed outside the City of Chicago. The City of Peoria is automatically covered under Articles 3 and 4 as its population is in excess of 5,000. Annually, the City must levy a property tax at a rate that will produce an amount that, when added to the employee contributions and other receipts, will equal a sum sufficient to meet the annual requirements of the funds. (40 ILCS 5/3-125 and 40 ILCS 5/4-118). The tax is levied and collected in the same manner as all other property taxes for the City, but the proceeds must be immediately forwarded to the treasurer of the pension board.
This pension obligations have created a substantial financial burden on the City's financial condition. The unfunded liability is growing exponentially compared to the City's declining revenues. Therefore, the City must maintain revenue streams to meet this financial burden. In that regard, this ordinance would continue the fee on all commercial and residential properties inside the City the revenues of which, would be dedicated to paying for police and fire pensions.
The proposed extension of the fee will remain in place until further action of the Council. The fees per property type are laid out in Appendix A of the ordinance.
FINANCIAL IMPACT: $2,044,700 in 2022.
NEIGHBORHOOD CONCERNS: None.
IMPACT IF APPROVED: Reduce the amount of cuts to staff and services that will have to be made to cover the rising pension costs. Continue to ensure public safety pensions are funded at a sufficient level.
IMPACT IF DENIED: Increase the amount of cuts to staff and s...
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