Lake County Gazette

A recent assessment by Wirepoints on the negative financial impact caused by local pensions gave Lake Forest a 'D' in its assessment of the financial impact of local pensions on Illinois' 175 largest cities from 2003-2019.

According to the report, 650 local pension funds around the state are causing financial issues for cities, taxpayers, and workers, but city officials have limited options due to state mandates.

"Local officials can do little about the crisis because city retirement costs are largely a consequence of the state’s top-down, one-size-fits-all mandates which prevent cities from actually solving their pension problems," the report stated, leading to municipalities cutting services and jeopardizing the retirement of workers, leading to layoffs in places such as Springfield, where more than 40 police personnel have been laid off in the past decade.

Wirepoints evaluated 10 equally-weighted metrics to grade cities from A to F on a 100-point scale, based on factors such as pension fund health for police and firefighters, the share of pension debt for the community, contributions from taxpayers and employees, and the number of active workers paying in compared to beneficiaries drawing benefits, among others, according to Wirepoints.

The number of cities with 'F' grades rose from seven in 2003 to 102 in 2019, the report stated. Lake Forest's grade dropped from a "C" in 2003, when it had a total score of 77, to a "D" in 2019, with a total of 63. The city's police, fire, and municipal pension funds faced a shortfall of $14.7 million in 2003, which increased to $61.9 million by 2019. As a result, each Lake Forest household is now responsible for $8,835 in debt, Wirepoints reported.

Lake Forest's budget is being consumed by pension costs that rose from 8.0% to 14.7% between 2003 and 2019. Despite increased contributions, the city's pension plans dropped from being 79.9% funded in 2003 to 63.7% in 2019. Additionally, the number of active workers supporting retirees has decreased significantly, from 1.67 to 0.81 workers per pensioner, the report stated.