Trustees of the South Lyons Township Sanitary District are paid a relative pittance, several thousand dollars a year each. But their retirement benefits can be much sweeter – with two former officials alone potentially costing taxpayers more than $800,000 in upfront costs.
That’s because service credits can be combined – and pension payouts greatly magnified – if trustees also happened to work for other taxpayer-funded bodies, as was the case with two former South Lyons trustees.
As the state, cities and other government bodies struggle with funding pension plans, the South Lyons situation illustrates not just the generosity of some retirement packages, but also their resilience. The South Lyons pensions live on despite at least two efforts to kill them in the last 40 years.
The pensions stirred controversy in just the past few years. The Illinois Municipal Retirement Fund, or IMRF – the overseer of the district’s retirement plan – tried to strip away the trustees’ benefits in 2011, arguing that board members didn’t work enough hours to justify even having pensions.
“I don’t think they deserve pensions,” said former South Lyons trustee John Finn. During an audit of the district’s retirement plan, he refused to sign paperwork certifying he worked enough hours to qualify for a pension.
“I kept a log [of my hours] and said nope, I’m not signing this,” Finn told the Better Government Association.
The sanitary district, which contracts its work out, maintains about 20 miles of sewer lines for roughly half of Countryside and part of LaGrange. (It’s so small, some local officials have questioned whether it should even exist, whether its duties should be absorbed by other agencies.)
IMRF is the pension plan for many suburban and Downstate government employees, plus the sanitary district. It was IMRF’s staff that tried to rescind the South Lyons pensions. But following an audit on hours and eligibility, IMRF’s board ultimately determined there wasn’t sufficient evidence that any of the trustees were short of 600 hours a year required to be eligible for a pension.
That wasn’t the first effort to end the sanitary district’s trustee pensions. In 1978, South Lyons board members stripped away retirement benefits for themselves declaring they didn’t work enough hours to qualify for pensions.
But that didn’t last.
The district’s board members, none of whom are currently still there, voted to fully reinstate pension benefits in 1987.
Although the South Lyons board members made only $3,000 a year in 1987, their pensions are worth much more. The service credits that come with the trustee position can be far more lucrative than the salaries when factoring their pension calculations – if the officials worked other government posts.
The pensions for the three trustees who voted to give themselves the retirement benefits in 1987 break down as follows:
+ John C. Walsh served on the South Lyons board from 1981 through 2004. He then served as assistant superintendent of the district until 2008. He started collecting his pension in July 2009. His current annual pension is $73,815. If his time as a sanitary district trustee didn’t count, his pension would be $25,757 a year, according to IMRF. Walsh also worked for Lyons and Worth townships.
Walsh paid $64,222 in total to fund his entire pension. Of that, he contributed $20,298 for his South Lyons work. Because of rules guiding payouts to beneficiaries with multiple government jobs, the sanitary district paid IMRF $427,493 to fund his pension, according to IMRF.
Last year the districtcollected$324,038 in property taxes. The taxes collected in recent years have been relatively flat.
In a statement, Walsh defended his sanitary district pension. He said the idea that he didn’t work enough hours as was alleged by IMRF was “ludicrous” (the IMRF audit looked at current and former trustees and how much time they put in) and he pointed to the pension fund board’s final decision to uphold the district’s retirement plan.
+ Peter A. Felice joined the South Lyons board in 1986 and left in 2002. Felice, who also worked for the City of Berwyn, is now a Cook County judge and has not started drawing a pension. If he had retired May 1 and combined all of his government time and credits, IMRF estimates his annual payout from IMRF would have been $48,600 a year. The sanitary district would have to pay $427,810 to fund that pension, according to estimates from IMRF. In total, Felice personally contributed $3,521 for his years with South Lyons. Felice would still qualify for a separate judicial pension.
Contacted by the BGA, Felice asked for questions in writing but then did not respond to them.
+ Thomas F. Peck joined the board in 1980 and left in 2010 but doesn’t have additional government service to enhance his retirement payouts. His current annual pension is $3,775. The district paid IMRF $29,491 to fund his pension. Peck, who could not be reached for comment, contributed $5,211 in total.
Current Trustees Susan Felice (wife of former Trustee Peter Felice), Michael Grace and Tom Clancy all told the BGA they work enough hours to someday qualify for IMRF pension benefits and are currently enrolled but not yet drawing retirement payouts. The three each make $6,000 a year for their work for the sanitary district.
