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Bill to force added transparency in pension payouts moves forward

Illinois Watchdog.Org

Tuesday, March 5, 2019  |  Article  |  By Cole Lauterbach

Local Government (60) , Pensions (70) McSweeney, David--State House, 52
Many public employees in Illinois are able to save up rolled-over sick days to boost retirement payouts, but lawmakers are moving ahead with legislation that would keep officials from being blindsided by those costs.

The amount that a public pensioner in Illinois receives in retirement is based on their pay in the last years of their career in public service. It’s become common for some workers to save up sick days and cash them out in this window to boost their annual pay, thus boosting their retirement pay as well.

State Rep. David McSweeney’s legislation, which was unanimously approved by a committee, wouldn’t ban the practice, but it would require many of the workers to disclose how many sick says they’re holding onto. The state's constitution prohibits the diminishment for pension benefits.

“There is a law on the books that requires, for end-of-year lump sum payments and for large spikes that the end of a career, for disclosure to occur,” he said. “All I’m doing is adding accumulated sick pay for this IMRF program.”

If signed into law, the bill would only apply to non-union participants of the Illinois Municipal Retirement Fund.

The issue became a headline when Calumet City School superintendent Troy Paraday attempted to cash in more than $1.7 million in sick and vacation days just before his retirement.

Local units of government are required to pay IMRF contributions at a higher priority than any other expenditure. The amounts are set by the pension fund. Large retirement payouts can blindside municipalities that didn’t know a recently retired worker may have qualified for higher compensation, putting a strain on budgets.