Chicago ‘Burb Dumping Fire Department Due to Pension Debts

North Riverside, Illinois, a
community of less than 7,000 west of Chicago, claims it cannot
afford to sustain its own crew of firefighters. After the
firefighters union apparently refused to sign on to an agreement
where existing firefighters would be slowly replaced by a
privatized force after they retired or left the village over the
next decade, the city is now going to sue to just dump them all now
and replace them with a private employer. North Riverside says the
costs are ruining
them:

North Riverside, with a population of 6,672 in 2,827 households,
derives most of its revenue from sales tax, thanks in large part to
North Riverside Park Mall. However, the village is facing a
proposed fiscal year 2014-2015 operating budget deficit of $1.9
million, with $1.8 million of this deficit being a direct result of
the Village’s growing annual public pension obligation. All of this
and more is evidence that supports the Village’s inability to
sustain salary and benefits of over $200,000 per fireman and
$230,000 per Lt. anymore.

Contracting firefighter services from Paramedic Services of
Illinois (PSI), which has provided paramedic services to North
Riverside for the past 28 years, would save the village more than
$700,000 annually and vastly reduce the adverse impact of future
pension obligations imposed by the state.  All PSI paramedics
are certified as firefighters, as well.

According to [Mayor Hubert] Hermanek, the village presented
multiple compromise proposals to the union, including a progressive
privatization plan based on an 11-year contract, during which 10 of
North Riverside’s 14 current firefighters would reach retirement
age and 25+ years of service.  As they retired or normal
attrition occurred, firefighters would be replaced with
firefighters/paramedics from PSI. As a result, by the end of the
11-year contract, village fire and emergency protection services
would be almost fully privatized, maintaining safe and reliable
service, while achieving cost-savings necessary if North Riverside
is to remain solvent.

According to the village’s press release, current firefighters
will be offered the chance to keep their current jobs in the new
system with their base salaries and health insurance and will keep
their current pension benefits. But they will be shifted over into
a 401k savings plan (with employer-matching contributions) rather
than racking up more debt in an ongoing pension program.