ACTION REQUESTED:
Title
Communication from the City Manager and Corporation Counsel with a Request to ADOPT an ORDINANCE Creating Article XVIII (PUBLIC SAFETY PENSION FEE) of Article 18 (Licenses and Miscellaneous Business Regulations) of the CODE of the City of Peoria.
Body
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 manager 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 has 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 develop new revenue streams to meet this financial burden. In that regard, the new ordinance would create a fee on all commercial and residential properties inside the City the revenues of which, would be dedicated to paying for police and fire pensions.
Originally staff proposed a new fee for 2019 at $50 annually for properties that contain a building of less than 5,000 square feet and $300 for a property that contains a building of more than 5,000 square feet that would generate approximately $2,183,960 toward pension funding. On November 13, Council asked for additional levels of the fee to be included, and for the fee to be imposed on vacant parcels. On November 20, Council asked staff to size the fee to generate $1,200,000.
The revised Ordinance exempts al...
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