Excerpts from DailyHerald.com:
A recent lawsuit filed by the village of Barrington is targeting the Barrington Countryside Fire Protection District over a dispute involving a joint firefighters' pension fund. According to the legal filing, the fire district is allegedly refusing to pay at least $1.2 million in outstanding pension obligations.
However, the fire district has conducted its own audit and claims it has no liability for the pension fund. The suit argues that when the fire district separated from the village-run fire department on December 31, 2013, the pension fund was already short by $1.9 million. Village officials say that in 2005, the fire district's leadership had agreed to cover 64.25% of "fire services costs," which included pension expenses. At the time of the split, this amounted to more than $1.2 million, as stated in the lawsuit.
The village is also seeking an additional $800,000 in long-term disability insurance costs. But the financial picture may be even more complex. The lawsuit claims that the fire district requested the village to recalculate the pension liabilities using a state-mandated funding formula, which increased the total amount owed to over $2 million. A court will now need to determine whether the fire district owes the village any money—and if so, whether it’s the original $1.2 million or the newly calculated $2 million figure.
Village Manager Jeff Lawler said, “This is unfortunate, but it’s of their doing. For 19 years before the split, they paid under this formula.â€
According to village officials, they have sent multiple invoices to the fire district since the separation, but the district has refused to pay what the village believes it is owed. In June, the village returned a $14,000 check that the district had sent.
Before the split, the fire district had been paying the village for fire protection services. However, in the years leading up to the separation, the district’s board grew increasingly dissatisfied with how the village managed the fire department. When the intergovernmental agreement came up for renewal, both sides decided to end their partnership and divide equipment and other assets.
Lawler noted that the separation agreement clearly stated the district would be responsible for all unfunded pension obligations, which could potentially reach into the seven figures.
The lawsuit also includes a request for reimbursement of legal fees incurred by the village in its efforts to recover retirement and disability benefits from the fire district.
According to the most recent audit of the fire protection district, the district holds over $2.5 million in reserves. In 2014, the district generated nearly $5.9 million in revenue, primarily through property taxes—$5.6 million of which came from local taxes. However, its expenses exceeded $6.2 million during the same period, according to the audit.
The audit acknowledges the village’s invoices but states that the district does not assume any liability for the pension fund. It offers no clear resolution to the ongoing dispute.
Regarding the long-term disability debt, the fire district argues that payments should only be made when the village actually processes claims, rather than assuming a full lifetime cost that may ultimately be lower.
Thanks, Dan
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