Monday, September 12, 2016

Chicago Tribune Uncovers Pension Scams of Ex-Mayor Daley and Friends


On May 2, Jason Grotto of the Chicago Tribune penned his experience in ferreting out how former Mayor Richard M. Daley (pictured) and his friends were able to milk the city’s pension system for millions and hide it from public view for 20 years. 
We’ve been exploring the pension crisis in Chicago and Illinois for about two years now: it takes that kind of time to understand how the pension system and individual pensions work.
Illinois pension laws are like a giant jigsaw puzzle. Without the time our editors have given us to figure out how the pieces fit together, we probably wouldn’t have been able to [figure out] how individuals [like former May Richard Daley and former Alderman Thomas Allen] are able to use Illinois’ convoluted pension laws to dramatically boost their pensions.
The scam began in 1991 when Daley was just two years into his first of six terms as mayor of Chicago. He resurrected a bill that his predecessor, Mayor Harold Washington, had rejected as being too costly and frivolous. That bill, designed to boost Chicago aldermen’s pension benefits, served to provide the circuitous route that Daley himself manipulated into a retirement benefit far above what it would have been, while saving himself the trouble (and the expense) of contributing $400,000 to his own plan. As Grotto noted:
Those pensions were made possible by a little-known provision slipped into a much larger pension bill that passed in 1991. We went back to that larger piece of legislation and found that besides a sweetener for labor leaders receiving public pensions, it also included one for Chicago aldermen…
Among the records we received back were hundreds of pages dealing with former Mayor Richard M. Daley…
Here’s how Daley did it: As a member of the Illinois state senate and then as the Cook County State’s Attorney, Daley joined, and contributed to, the legislative pension plan, the General Assembly Retirement System, or GARS, until he was elected mayor in 1989. Under the new rules, he rejoined GARS for one month which qualified him for retirement benefits at 85 percent of his mayor’s salary. That meant that, at his age 49, he could have retired at age 55 with a pension benefit of $97,750 a year, far higher than the $20,686 he would have received if he hadn’t rejoined GARS.
He went on, however, to win five more terms as mayor and now receives a pension of $183,778 per year — $15,314 a month — which is about $50,000 more each year than he otherwise would have received had he not made the jump into, and out of, GARS back in 1991.
Daley was able to take advantage of another sweet deal built into the pension bill that he helped pass: He was able to “purchase” years of benefits from his legislative days to add to his pension benefits, which would normally have cost him about $540,000, just by transferring his GARS credits of $128,000 over to his own pension plan, neatly saving him over $400,000. 
Today GARS is only 21 percent funded with unfunded liabilities of $235 million. The only way that shortfall can be made up is by taxing Chicago residents. As noted by Laurence Msall, president of the Civic Foundation:
There is no public policy justification…in allowing people [like Daley]…to come back and re-enter the General Assembly pension. This is an example of why the state Legislature needs to…stop treating the pension system as if it’s their personal piggy bank.
Grotto uncovered an even more egregious example of milking the system: that of former Chicago alderman Thomas Allen. Allen was able to retire on 80 percent of his alderman’s salary of $110,000 even though he served only 17 of the 20 years needed to qualify for it. He bought his way into the plan by purchasing credits from his time spent as an aide to his father. That cost him $21,000. And then he was allowed to purchase an “upgrade” to his plan for another $24,000. That $45,000 additional contribution resulted in his pension increasing from $41,000 a year to $88,000 a year. Allen now receives $91,000 a year and, according to Grotto, “in just seven more years his city pension will be larger than his aldermanic salary.” If Allen lives out his normal life expectancy, Grotto estimates he’ll receive about $4.2 million before he dies.
Here’s the kicker: 20 other Chicago aldermen have retired under similar rules and are estimated to receive nearly $58 million during the remainder of their lifetimes, while the contributions they collectively have made to the plan total less than $19 million. And there are 53 more aldermen just waiting to retire.
The municipal pension plan is currently under water by $6.7 billion. As noted by Jacky Grimshaw, former mayor Washington’s liaison to the City Council:
There are several types of corruption in this city…This is the hidden type, the piece of legislation that benefits a handful of people. You don’t know where it comes from. You don’t know whom it benefits. It’s the most insidious kind of corruption.

34 comments:

Anonymous said...

Let it crumble and go broke. When daleys sues to get paid point him to this article and say fuck off

Anonymous said...

The Milkman lives on The Gold Coast
Chat Him Up

stash the polski guy said...

yup, as long as the pensions of the ruling class is fully funded. there is no problem. the ghost pensioners ripping off the state has to be huge. stop payments to make them come forward.

Anonymous said...

I knew that.

SpankDaddy said...

Assholes.

Anonymous said...

From the Pig Trough to The Gold Coast
Abbie Hoffman Was Right

Anonymous said...

I hope that dirty pos dies soon

Anonymous said...

Truth be told- After Byrne - Washington was a better mayor for the Police than Daley ever was. Treated us ok and maybe would have been more cognizant of the pending pension nonsense.

Anonymous said...

yet nothing will be done about it.

Anonymous said...

Can Ald. Oshea buy his time back from bartender at McNallys

Rufus Khan said...

But They like Hillary are American Royalty and as such are immune from the petty laws that govern and control the American peasant.

Anonymous said...

THE CTU AND CPS are close to agreeing that teachers can live outside of Chicago.......for dropping city's 7% pension payment.

Anonymous said...

THE CTU AND CPS are close to agreeing that teachers can live outside of Chicago.......for dropping city's 7% pension payment.

Anonymous said...

In hindsight he was probably the best all around Chicago Mayor in my lifetime. And that includes Richy I.

Anonymous said...

Chuck Goudie from ABC 7 NEWS reported that its a done deal, CPS wants a 5 year deal to drop residency clause.

Anonymous said...

Saw that Friday, Unbelievable.
Teachers get out and cops are stuck.
Where the fuck is Dean.

Anonymous said...

I think it's fair. They deal with the negros all day. CPD deals with them for 1 hour then to Bourbon street for 7.

Anonymous said...

Do you guys know that former Ald. Allen is now a Cook County Judge and is running for Chief Judge against Tim Evans?

Anonymous said...

ZERO accountability......

Anonymous said...

God bless the teachers, give up that 7% and move

Anonymous said...

Yes he can.
Sunday is Ald. Oshea birthday. Free beers at McNallys. NO JOKE. STOP IN

Anonymous said...

Sure he can, why not.

Anonymous said...

wonder how much Daley gets every year from the kickbacks by the Double-dipping Labor Union Leaders he set up with Taxpayer funded Pensions on top of their regular pensions, by making it allowable for them to work only one day to be eligable to recieve a Double-Dipper Pension.

Anonymous said...

Marty the drunk is bartending that night also.

Anonymous said...

Funny thing is not only are these teachers big drunks their also whores. Most of them don't live in city anyway I know many who have never lived in city. The pansy teachers think they check up on their residency and they don't.

Anonymous said...

CPD doing such a shit job, make them move into Englewood

Jackie Puppet said...

Daley, Allen, and the others that stand to benefit the most need their lives shortened by something unexpected & untreatable.

Shit like this makes me wish the economy would go tits-up, and the bankers will do bail-ins so they get their money first, just so the Daleys & Madigans get fucked, too.

Anonymous said...

He Always Will Be A Mayor in The Hell Fire Society

Anonymous said...

It is critical that Hillary recover and go on
To finish all 3 debates. only then will
American public know she is unfit for
Office. Let her be well. Trump will prevail.
7 HD: Get A Shot On That

Anonymous said...

Just how many Police and Fire had to die
While this Irish Pig went home every night
To a Steak and Irish Whisky? TOO Many!
Every Irish I have ever known was always
Next to a Nigger in oh so many ways.
Irish Stab-In-The-Back, Irish Hillbilly,
Irish Space Cadet (that's YOU, Fucking Patrick!).
So Mayor Daley, enjoy your WhistlePig Rye!
Hillary Clinton must live, so that later she might
Die. The SYSTEM Must be Overturned.
Irish Fucking Pigs. Go to him,Patrick, suck
His DICK!

Anonymous said...

Daley, all the Dry Cleaners on The Gold Coast
Could not remove the Skid Marks from your Jockey
Underwear. You will take those to your Grave. You
Are cursed by the People of Chicago. You Fucking
Pig. Your City was always Corrupt. Don't eat from
This tree, but you DID, you Irish Pig. You have enough
Money to buy 15-Yr WhistlePig, but you just can't get
One more gig. Your dick is flat, your dick is small, you
Became fat,,you became chubby, you can't get a whore,
You turned your back on the Chicago Cubby.
Die In Nigger Hell. Laquan Shine His Shoes. NOW!

Anonymous said...

as we stated before, the Feds won't even question the bridgeport theif, he was a snitch for years ala Whitey Bulger for the Feds to put the finger on other theives,ever notice how all the baddies around him went down but he was never touched,Bills is the latest example of Richie tells all,,,and the goof will do 10 yrs and swear his loyalty to the 11th ward while he sits in the federal can while they breath a sigh of relief and laugh at him....

Anonymous said...

Let cps move out. They deseve it.
Principles shoving BLM shit down teachers throats.

Anonymous said...

GET READY FOR MAYOR PATRICK DALEY THOMPSON!!