pbpacontact posted on October 18, 2019 18:01
October 18, 2019
FOR IMMEDIATE RELEASE
CONTACT: Sean Smoot, 217-523-5141, ext. 203
Latest Department of Insurance Figures Show Downstate Pension Systems are Lowest in Administrative Costs
SPRINGFIELD – The latest figures released by the Illinois Department of Insurance show that the Illinois Municipal Retirement Fund (IMRF) and downstate police and fire pension systems have the lowest administrative costs of any pension systems in the state. This new data is key information that should be carefully considered during any discussion of pension fund consolidation, according to the Illinois Police Benevolent and Protective Association (IPBPA).
“Much of the current talk focuses on the alleged administrative cost savings by pension consolidation, yet this latest information shows the IMRF, police and fire pension funds already have lower administrative costs than anybody else,” said PBPA Executive Director Sean Smoot. “In fact, those local system costs are far lower than those for the State of Illinois' pension systems. Those who favor the consolidation of police and fire pension funds will need to explain how moving millions from a lower-cost system to a higher-cost system will save the taxpayers money.”
The Bi-Annual Department of Insurance Public Pension Division's October 2019 report shows that 6.2 percent of the total funds administered by the IMRF go toward administrative costs. The figure for downstate police pension systems is 7.97 percent, and for fire pension systems it is 8.37 percent. The administrative cost for the State of Illinois' employee pension system is 14.36 percent.
“We want to stress that this data comes directly from the State of Illinois, not from any group pushing for or against consolidation,” Smoot said.
The PBPA suggests that, rather than consolidating the local systems, the Illinois General Assembly should allow the smaller systems to invest their funds at a much higher rate of return like the IMRF is allowed to do. Without the investment restrictions, which are placed only on small police and fire pension funds, and with no consolidation, the local pension funds could generate their own higher returns, meaning no extra cost to the taxpayers to keep the funds healthy.
Founded in 1936, The Police Benevolent & Protective Association of Illinois is the largest downstate police association consisting of full-time and retired sworn police officers. The PB&PA represents the interests of our members and all law enforcement officers. www.pbpa.org
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