WBEZ | CHicago police union http://www.wbez.org/tags/chicago-police-union Latest from WBEZ Chicago Public Radio en Chicago police union president suspended http://www.wbez.org/news/chicago-police-union-president-suspended-109405 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/AP330493917876.jpg" alt="" /><p><p>The Illinois Fraternal Order of Police has suspended the head of Chicago&rsquo;s police union, one day after he accused fellow union leaders of scheming with City Hall and arbitrators to &ldquo;fix&rdquo; police contracts.</p><p dir="ltr">Chicago FOP Lodge 7 President Michael Shields was apparently suspended during a union meeting Tuesday night. On Monday, Shields sent a letter to the city&rsquo;s inspector general accusing four current and past union leaders of colluding with independent arbitrators and city negotiators to hold contract arbitrations that were &ldquo;manipulated and phony.&rdquo;</p><p dir="ltr">The letter was first reported by the Chicago Sun-Times, and later leaked to other media outlets, including WBEZ.</p><p dir="ltr">&ldquo;As many of you are aware, this past Monday, Lodge President Michael K. Shields publicly accused respected arbitrators, City and FOP labor lawyers, and present and former Lodge officials of fraud and conspiracy to commit fraud during past contract negotiations,&rdquo; reads a <a href="http://www.chicagofop.org/lodge-7-presidents-status/">statement</a> on the Chicago union&rsquo;s website.</p><p dir="ltr">&ldquo;Due to the recent actions of President Shields, Illinois State FOP Lodge President Ted Street was forced to suspend President Shields&rsquo; &lsquo;membership rights, duties and authority and therefore is suspended as President of Chicago FOP Lodge #7,&rsquo; pending a hearing before the State Lodge Board of Trustees,&rdquo; the statement reads.</p><p dir="ltr">Street did not return phone calls seeking further details.</p><p dir="ltr">Tuesday night&rsquo;s police union meeting was apparently tense enough that someone called the police to keep the peace.</p><p dir="ltr">&ldquo;After a call for service was received, a sergeant and two officers were dispatched to the scene to ensure that order and safety was maintained, but, at no point, did CPD interfere with the business of the union,&rdquo; Chicago Police Department spokesman Adam Collins said.</p><p dir="ltr">In an interview with WBEZ earlier on Wednesday, Shields denied that he had been suspended and maintained he was still acting as president of the Chicago FOP lodge.</p><p dir="ltr">&ldquo;I brought to light information to the inspector general regarding past practices of [former President] Mark Donohue, [First Vice President] Bill Dougherty, [Financial Secretary] Rich Aguilar and [former Third Vice President] Greg Bella,&rdquo; Shields told WBEZ, referring the the four union leaders he accused of rigging contracts. &ldquo;Now [they] are retaliating against me by having their close friend, Ted Street, &nbsp;attempt to take action against me, which is 100 percent illegal and the truth will come out about those four.&rdquo;</p><p dir="ltr">Despite Shields&rsquo; earlier claim that he was still in charge, the statement from the Illinois FOP later Wednesday afternoon said Dougherty will serve as acting union president.</p><p dir="ltr">Contract arbitrations occur when one side in a negotiation declares an impasse. Outside arbitrators are supposed to mediate the dispute as an independent third party, then issue a legally binding decision.</p><p dir="ltr">But in Monday&rsquo;s letter to Chicago Inspector General Joe Ferguson, Shields claimed the four union leaders &ldquo;rigged&rdquo; at least two contract arbitrations in order to gain &ldquo;political cover against FOP members&rsquo; potential accusations that the FOP leadership had &lsquo;sold out&rsquo; to the City of Chicago.&rdquo; He also claimed the head of the police sergeants&rsquo; union played ball with City Hall during &ldquo;phony&rdquo; contract talks.</p><p dir="ltr">Shields did not cite any specific evidence to back up his claims in the letter, or during later interviews with WBEZ. He said he was told of the schemes by the union&rsquo;s top lawyer, Paul Geiger. Geiger did not return phone calls seeking comment.</p><p dir="ltr">The police union&rsquo;s public flap comes just a few months before Shields was to stand for re-election as lodge president. He&rsquo;s taken heat this year for <a href="http://www.suntimes.com/news/metro/22196864-418/story.html">missing two deadlines</a> that could cost rank-and-file cops their retroactive pay raises, as the union continues to negotiate a new contract with the city.</p><p dir="ltr">Aguilar denied the accusations in the letter were true. The head of the Chicago Police Sergeants&rsquo; Association, Jim Ade, said Shields&rsquo; claims were &ldquo;baseless.&rdquo; Bella, Dougherty and Donahue did not return phone calls from WBEZ.</p><p dir="ltr"><em>Alex Keefe covers politics for WBEZ. Follow him on Twitter @akeefe.</em></p></p> Wed, 18 Dec 2013 16:11:00 -0600 http://www.wbez.org/news/chicago-police-union-president-suspended-109405 Experts say Chicago has a public pension system set up to fail http://www.wbez.org/news/experts-say-chicago-has-public-pension-system-set-fail-109329 <p><p>Illinois lawmakers may have approved a fix for the state&rsquo;s pension crisis. But Chicago is still facing a massive spike in required pension payments to help bring its own funds up to speed.</p><p>The city&rsquo;s four pension systems &mdash; for police, firefighters, laborers and municipal workers &mdash; were short by a whopping $19.5 billion at the end of 2012. That does not include the ailing pension fund for Chicago teachers, which has its own $8 billion shortfall at the end of the last fiscal year.</p><p>Increased benefits for city workers, early retirement offers and market downturns put pressure on the city&rsquo;s four pension funds in the late 1990s and early 2000s. But pension experts, labor leaders and politicians also point to a more fundamental problem &mdash; a quirk of state law that experts say may have set the system up to fail.</p><p>Retired Chicago firefighters George Beary, 70, says he wasn&rsquo;t making a lot of money when he started at the fire department back in 1967. But he still remembers the words of consolation he got from one of his officers in the fire academy.</p><p>&ldquo;When we got on the fire department, we were taken care of from the time we walked through those big red doors, to the time they haul your ass outta church to go in the ground,&rdquo; Beary recalled. &ldquo;You&rsquo;re covered. Exact words.&rdquo;</p><p>But for Beary, they don&rsquo;t ring as true today.</p><p>He and a group of fire department retirees - they call themselves &ldquo;oldtimers&rdquo; - sipped coffee and munched on donuts one recent morning at the Chicago Firefighters Local 2 Union hall, on the city&rsquo;s South Side.</p><p>Altogether, Chicago&rsquo;s four pension accounts were just 36 percent funded at the end of 2012. But the one for firefighters and paramedics is the worse off by far.</p><p>For every dollar it owes in benefits, it has just a quarter in the bank.</p><p>&ldquo;See the gray hair? That comes from worry,&quot; said retired Capt. Peter Qualizza.</p><p>He&rsquo;s one of roughly 4,100 beneficiaries in the firefighters&rsquo; pension fund which some experts project could go broke in less than a decade.</p><p>&ldquo;So everyone here has gray hair,&rdquo; Qualizza said, drawing laughs from the other retirees sitting around a long conference table. &ldquo;Some of &lsquo;em color it, some of &lsquo;em don&rsquo;t, okay? But everyone of us has gray hair because we&rsquo;re concerned about the future.&rdquo;</p><p><strong>Chicago&rsquo;s unrealistic pension math</strong></p><p>The roots of Chicago&rsquo;s pension troubles go back decades, long before Qualizza and the other oldtimers starting going gray.</p><p>At issue is the so-called &ldquo;multiplier&rdquo; equation by which City Hall calculates how much money to chip into its pension piggy banks each year. It may sound complex, but the math is simple: City Hall bean-counters take the amount that workers in each fund paid into their pensions from two years prior, then they multiply that by a number that&rsquo;s set in state law.</p><p>As a matter of state law, Chicago&rsquo;s pension math is set by Springfield legislators. But the unique multiplier number for each of the four funds hasn&rsquo;t increased since 1982.</p><p>&ldquo;This is really one-of-a-kind in my experience,&rdquo; said actuary Jeremy Gold, who studies public pensions all over the country. &ldquo;There are no other public pension plans that I am aware of...that pays the way Chicago pays.&rdquo;</p><p>Gold says the fundamental problem is this multiplier doesn&rsquo;t change with the times. That means the money going into each fund stays relatively flat, regardless of whether retirees get richer benefits, stock markets crash or the system is burdened by thousands of early retirements, as it was under former Mayor Richard Daley in 1998 and 2004. (Daley declined WBEZ&rsquo;s interview request.)</p><p>The relatively static funding level is akin to offering to pay your grocer the 1982 price for a gallon of milk.</p><p>A 2010 <a href="http://www.chipabf.org/ChicagoPolicePension/PDF/Financials/pension_commission/CSCP_Final_Report_Vol.1_4.30.2010.pdf">report</a> commissioned by Daley found this inadequate funding was the main reason Chicago&rsquo;s police and fire pension funds have taken a such dive in the 2000s. The report blamed benefit increases for the dire condition of the laborers&rsquo; and municipal workers&rsquo; funds, though the inadequate funding has made it harder for them to recover.</p><p>&ldquo;At this point, after having been in place for 30 years, it no longer bears any relationship to the realistic cost of providing these benefits,&rdquo; Gold said.</p><p><strong>Pension problems that go back decades</strong></p><p>In fact, the problem is much older than that.</p><p>In his downtown office, fire pension fund secretary Tony Martin flips through a massive, shopworn book containing notes from pension board meetings going back more than a century, from 1887 to Dec. 18, 1931.</p><div class="image-insert-image "><a href="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/pension_chart_for_al.jpg" target="_blank"><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/pension_chart_for_al.jpg" style="height: 247px; width: 400px; float: right;" title="Sources: WBEZ analysis of data from the Chicago Firemen’s Annuity and Benefit Fund, Policemen’s Annuity and Benefit Fund, Municipal Employees’ Annuity and Benefit Fund and the Laborers’ Annuity and Benefit Fund" /></a></div><p>Martin finally lands on a<a name="chart"></a> yellowed, typewritten letter the firefighter&rsquo;s pension board sent to state lawmakers on Wednesday, May 4, 1927.</p><p>The letter&#39;s author is complaining about the way Chicago funds its pensions - about a system that&rsquo;s awfully similar to today&rsquo;s multiplier - and the board is asking state lawmakers for relief.</p><p>&ldquo;It&rsquo;s amazing!&rdquo; Martin said. &ldquo;We never really dealt with the structural issues of these pension funds.&rdquo;</p><p>Martin says the stock market boom of the late 1990s only masked those structural issues - especially for police and fire pensions. But he says the chronic underfunding means investment losses hit them even harder during the Dot-com bust and the 2008 recession.</p><p>Now, the pensions are forced to sell off the very assets they&rsquo;re supposed to be investing.</p><p>&ldquo;Basically what&rsquo;s happening is the money that&rsquo;s coming in from firemen today and the money that&rsquo;s coming in from the city today, is going out the door today,&rdquo; Martin said. &ldquo;We&rsquo;re not saving for tomorrow.&rdquo;</p><p>The rate at which the city&rsquo;s pension funds are cashing out investments has more than tripled since the year 2000, according to a WBEZ analysis. Last year, the four funds liquidated more than $1 billion.</p><p>The more the funds liquidate, the less money they can make on investments, which could lead to even more liquidation in order to have enough money to pay out to retirees. Pension experts say this is a dangerous cycle - kind of like eating yourself to avoid going hungry.</p><p>This whole situation makes Tony Martin angry - and he says it should make taxpayers angry, too.</p><p>&ldquo;They should be outraged that we&rsquo;re even in this situation,&rdquo; Martin said. &ldquo;It should have never gotten to this point. And who is to blame?&rdquo;</p><p><strong>Blame everybody</strong></p><p>The structural funding problem with Chicago&rsquo;s four pension systems is not entirely responsible for the current crisis, experts and observers say, but it left the funds ill-equipped to deal with the market downturns of the early 2000s.</p><p>And political deals between City Hall and labor unions burdened the system even more.</p><p>&ldquo;If you&rsquo;re looking for who to blame, it&rsquo;s everybody,&rdquo; said Dana Levenson, who served as Chicago&rsquo;s Chief Financial Officer from 2004 through 2007.</p><p>Levenson says even Daley&rsquo;s partly responsible, when he agreed to benefit increases and early retirement offers in order to ease budget pressures on City Hall. Levenson says it would have been hard to justify short-term pain, such as property tax hikes or layoffs, because the problem hadn&rsquo;t yet reached the crisis point.</p><p>&ldquo;By nature, we are all crisis managers,&rdquo; Levenson said. &ldquo;We don&rsquo;t necessarily want to do anything that is going to solve a potential crisis when that potential crisis is way off in the distance.&rdquo;</p><p>After all, the pension funds for city laborers and white-collar workers started the new millenium in pretty good shape. They had so much money the city stopped paying into the laborer&rsquo;s pension fund, and cut back payments to the municipal fund.</p><p>In hindsight, this was a bad idea, said Henry Bayer, who heads up the American Federation of State, County and Municipal employees, a union representing about 3,500 city workers.</p><p>&ldquo;You know, if this were going on in the private sector, there&rsquo;d be employer&rsquo;s going to jail,&rdquo; Bayer said.</p><p>But along with those cutbacks in funding in 1998 came benefit increases - increases the union fought for, even though they heaped more future debt onto the pension funds.</p><p>Although he wasn&rsquo;t directly involved in the negotiations, Bayer defended the deal.</p><p>&ldquo;These folks getting these pensions have no social security,&rdquo; Bayer said. &ldquo;We&rsquo;re a world-class city, and we can&rsquo;t afford a pension system for people that served the public?...I don&rsquo;t accept that.&rdquo;</p><p>Finally, in 2010, Illinois lawmakers tried to rectify these decades of underfunding by <a href="http://www.wbez.org/story/chicago/daley-calls-general-assembly-change-police-firefighter-pension-plans">forcing City Hall</a> to dump more money into the police and fire funds - about $590 million more in 2015 - a payment Mayor Rahm Emanuel says Chicago simply can&rsquo;t afford.</p><p>&ldquo;Should Springfield fail to pass pension reform for Chicago, we will be right back here in the council early next year to start work on the city&rsquo;s 2015 budget -- a budget that will either double city property taxes or eliminate the vital services people rely on,&rdquo; Emanuel told aldermen during <a href="http://www.wbez.org/news/mayor-emanuel-warns-pension-cliff-2014-budget-speech-108993">this year&rsquo;s budget speech</a>.</p><p>Emanuel says Chicago needs a break from its state-mandated spike in pension payments. He says there is no Plan B.</p><p>And exactly what Plan A looks like is still unclear.</p><p><em><a href="http://www.wbez.org/users/akeefe">Alex Keefe</a> is political reporter at WBEZ. You can follow him on <a href="https://twitter.com/WBEZpolitics">Twitter</a> and <a href="https://plus.google.com/102759794640397640028">Google+</a>.</em></p></p> Sun, 08 Dec 2013 11:38:00 -0600 http://www.wbez.org/news/experts-say-chicago-has-public-pension-system-set-fail-109329 Emanuel sticks with plan to phase out retiree health care payments http://www.wbez.org/news/emanuel-sticks-plan-phase-out-retiree-health-care-payments-108881 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Rahm budget round table WBEZ Alex Keefe.jpg" alt="" /><p><p>Despite a federal lawsuit, Chicago Mayor Rahm Emanuel said Wednesday he will move forward with a plan to phase out taxpayer-funded health care subsidies for tens of thousands of retired city workers starting next year.</p><p>The cost-cutting move is expected to save the city about $18 million in 2014, when City Hall is staring down an estimated $338.7 million budget hole.</p><p>The city&rsquo;s oldest retirees would get to keep their subsidies of up to 55 percent, thanks to an earlier federal legal settlement. But about 21,100 retirees and 9,100 spouses and dependents would see their city-paid subsides reduced, until those payments are zeroed out by 2017.</p><p>&ldquo;As I told everybody, we&rsquo;re gonna deal with the hard truths and not run away from &lsquo;em,&rdquo; Emanuel said Wednesday after a public roundtable with small business leaders.</p><p>&ldquo;[We] are gonna make changes over a three-year period of time as the healthcare landscape is also changing,&rdquo; he said.</p><p>The city is expected to spend about $103 million on health care subsidies by the close of 2013, according to Kelley Quinn, a spokeswoman for Emanuel&rsquo;s budget office. Next year, payments would drop to about $85 million as the city begins the three-year phase-out. That&rsquo;s if the plan survives a challenge currently playing out in federal court.</p><p>Workers hired between Aug. 23, 1989 and July 1, 2005 would see their city subsidy drop from 55 percent to 41.25 percent. Payments for workers hired after that will drop to between 30 percent and 37.5 percent, depending on how long the employee has worked for the city.</p><p>Emanuel&rsquo;s office is refusing to reveal how much the city subsidies will shrink during 2015 and 2016.</p><p>About 4,000 of the city&rsquo;s oldest retirees will get to keep their city subsidy of up to 55 percent for the rest of their lives.</p><p>After the city phases out its retiree health care subsides, Emanuel&rsquo;s office says retired workers who aren&rsquo;t eligible for Medicare will have the option of buying insurance through the Affordable Care Act, sometimes called &ldquo;Obamacare.&rdquo;</p><p>A Chicago lawyer filed a class action lawsuit in September arguing that Emanuel&rsquo;s move violates a part of the Illinois Constitution that states pension benefits &ldquo;shall not be diminished or impaired.&rdquo;</p><p>Emanuel is set to introduce his 2014 budget proposal to the City Council on Oct. 23. He has ruled out raising property, sales or gasoline taxes, but has not closed the door on other possible tax hikes.</p><p><em>Alex Keefe covers politics for WBEZ. Follow him <a href="http://twitter.com/akeefe" target="_blank">@akeefe</a>.</em></p></p> Wed, 09 Oct 2013 14:20:00 -0500 http://www.wbez.org/news/emanuel-sticks-plan-phase-out-retiree-health-care-payments-108881 Mayor: Weis did a 'very, very good job' http://www.wbez.org/story/alex-keefe/mayor-weis-did-very-very-good-job <img typeof="foaf:Image" src="http://llnw.wbez.org/jody weiss kate gardiner_1.jpg" alt="" /><p><p>Mayor Richard Daley on Wednesday said the city's police superintendent abruptly resigned this week in order to pursue other job offers.<br /><br />Jody Weis' resignation Tuesday - the final day of his contract - came as a surprise to the Daley administration. The mayor had indicated as recently as this week that he wanted Weis to stay on until the end of his term, rather than go through the trouble of hunting for a new superintendent who may only serve until mid-May, when Daley leaves office.<br /><br />Daley said Weis had been considering whether to stay past his contract for the last couple of weeks.<br /><br />&quot;He was undecided whether or not he wanted to stay,&quot; Daley said. &quot;He had offers coming in, and he just saw fit to do it.&quot;<br /><br />The mayor praised Weis for lowering the city's crime rate, taking the lead in prmoting anti-gun legislation and cleaning up the Chicago Police Department after some high-profile scandals.<br /><br />&quot;He came in under that cloud,&quot; Daley said. &quot;And he did a very, very good job.&quot;<br /><br />Mayor-elect Rahm Emanuel, who's indicated he would replace Weis once he's in City Hall, had nothing to do with Weis' departure, Daley said. The mayor also said pressure from the police union, which has been sharply critical of Weis' policies, wasn't a factor.<br /><br />&quot;Morale is good,&quot; Daley said. &quot;You know, we're public servants. And you select the job. You don't have to stay on this job. ... There're jobs out there.&quot;<br /><br />Former superintendent Terry Hillard, who served under Daley from 1998 to 2003, is leading the department on an interim basis.</p></p> Wed, 02 Mar 2011 19:24:00 -0600 http://www.wbez.org/story/alex-keefe/mayor-weis-did-very-very-good-job