Advisory opinion: Double-time holiday pay can’t count toward firefighter pensions

The Illinois Department of Insurance is advising the Springfield Firefighters Pension Board to halt allowing double-time holiday pay to be factored into firefighter pension calculations, a longtime practice that’s been called into question.

For each holiday that isn’t worked, Springfield firefighters receive an additional eight hours of regular hourly pay, which factors into pension calculations. At issue, though, is the additional double-time pay firefighters receive if they work a holiday, which the opinion contends shouldn’t factor into their pensions.

The city’s accounting firm concluded that the way holiday pay is figured for Springfield firefighters differs from other firefighter pension boards in the state, prompting attorney Don Craven to request an opinion from the department.

A letter from the department to the board in August said any holiday pay for firefighters shouldn’t be part of the pension calculation, contradicting a 1998 advisory opinion from the department.

The August letter said that in order for holiday pay to be considered part of the salary, every employee would have to receive the additional compensation whether they work the holiday or not.

At a meeting in August, the board members directed Craven to seek clarification from the Department of Insurance.

The opinion issued Friday from Mary Jane Adkins, acting deputy director of the department’s public pension division, advises that benefits that have already been granted cannot be “retroactively reduced.”

The opinion supersedes the past letters from the department to the board in 1998 and earlier this year.

City Budget Director Bill McCarty, one of the Springfield Firefighters Pension Board members, said he anticipates that the board will hold a meeting soon to discuss the opinion. While it’s advisory, an upcoming audit could lead to action that could go beyond being advisory, McCarty said.

“From the city’s perspective, we want our dedicated firefighters to get everything they have coming to them under the law for a secure retirement,” McCarty said, adding that employee benefits need to be balanced with making sure taxpayer money is spent appropriately.

Police and firefighter pensions are a hot-button issue in Springfield, and Mayor Jim Langfelder is planning to convene a summit, likely early next month, to begin addressing how to draw down the daunting debt.

A state law that went into effect in 2011 requires pensions be 90 percent funded by 2040. As of this year, the firefighter pension fund is 46.6 percent funded. The fund was more than 90 percent funded 20 years ago.

The Springfield Police Pension Fund is 53.6 percent funded.

Langfelder said he envisions the summit as an open forum with representatives from the police and fire pension boards, the Illinois Municipal Retirement Fund, the investment management group that oversees the city funds, and state legislators.

One of the challenges is balancing decreasing the pension debt with other city expenditures, including infrastructure issues, Langfelder said.