Chicago City Wire

Chicago, one of the worst run major cities in the country, just got a little worse.

Already squeezed between a dangerous job and hostile city officials, police officers have been told they need to make up for a shortfall, with an added three percent interest, for under payments into their pension funds, administered by the Policemen’s Annuity and Benefit Fund of Chicago (PABF). The mistake holds for about 3,000 officers paying into the PABF, Tier 2 members who began working on or after January 1, 2024. 

FOP Lodge #7, the union representing police, has filed a grievance over the interest rates.

“They are looking to hammer our officers with a decision that should fall on pension fund board members,” FOP President John Catanzara said in a YouTube message posted on Monday. “Another example of passing the buck onto the members [police officers] and not challenge the city.”

Second City Cop, a popular police blog site, reacted to the pension fund foul up commenting that the police officers don’t audit “every single check stub every single payday because - stupid or not - we assume that Finance does its job. We notice if there's a change in the total that hits the bank on payday and if there's a new Contract or an anniversary raise, we make sure everything checks out before disregarding it for another year. We do check the OT stubs against our records because we know the timekeepers are less than accurate a lot of the time.”

The site added that “Finance messes up the OT checks and we end up waiting for another month for money owed us, the City doesn't pay interest for that 30-day loan we just gave them. Just an ‘Oops’ and ‘We'll pay you next month.’"

In a letter to the affected police officers, PABF Executive Director Kevin Reichart wrote that the shortfall stems from “a fiscal year discrepancy with the City of Chicago, the retroactive salary contract payment you received 1/1/2022 was counted by the City toward your 2022 annual salary cap.”

In December 2023, City Council approved a new police contract that runs through June 30, 2027. Under it, officers are to receive five percent salary increases in 2024 and 2025, and cost-of-living increases tied to inflation. Officers also received a one-time $2,500 retention bonus.

At the same time, Council rejected a measure to remove more serious discipline cases from the civilian Chicago Police Board to arbitration. The FOP sued.

On March 21 Cook County Circuit Court Judge Michael Mullen ruled in a split decision for police: he said the police, as other public employees have a right to arbitration, but that the process must be a public one.

The PABF is among the lowest-funded city pension funds, with enough assets to cover 21.76% of its obligations through the end of 2022.

Engineer Your Finances recently compiled a list of the worst run cities in the country, ranked on finances, education, health care, safety, and the economy.

“The worst run city in all of Illinois is Chicago,” the group said.  “This city was also included when naming the worst run cities in the country. Other cities on the list included Chattanooga, Tennessee, Toledo, Ohio, Jackson, Mississippi, and more.”