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Committee discusses shifting pension funding to a dedicated levy and risks from possible state changes
Summary
Members discussed whether to dedicate property-tax levy lines to pension funding, the potential effects of a state-level ‘tier 2’ pension rollback, and how alternate revenues might offset general-fund impacts.
Committee members and staff discussed the village’s pension funding approach and whether to shift more pension liability onto a separate property-tax levy line to increase transparency. "Right now, as it is, a portion of our pension liability gets paid through property tax directly," a committee member said. "The question becomes, do we wanna think about changing that in light of, hopefully, other things that we'd be doing to put those pension lines."
Staff noted the village has reached an actuarial payroll-growth floor and has recently adopted actuarial recommendations; changing pension assumptions or funding approaches again would require further actuarial review. "If tier 2 does get enhanced, we're gonna have to talk that again and bring them back," staff said, referring to potential state-level changes to pension tiers. Committee members discussed options including staged changes, offsetting revenue sources, or a referendum but made no formal decision.
Staff proposed analyzing combinations of alternate revenue sources during budget development to see whether shifting pension funding to a dedicated property-tax line is feasible without unduly increasing the general fund shortfall. Staff will return with analysis and alternatives during the budget process.
