March 29, 2011
by Adam Andrzejewski
CEO| For The Good of Illinois
In 2008, Joliet hired a new City Manager. His starting base salary was $189,000.
For 2011, the base salary increased to $196,500 and the City Manager out-earned every governor of the 50 states.
In addition to this lucrative salary, $7,500 of taxpayer money goes into a “deferred compensation” retirement plan. The deferred comp plan is in addition to what the taxpayers pay into his pension plan: $28,800 into Illinois Municipal Retirement Fund (IMRF) pension. Contractually, Joliet taxpayers are required to fund lucrative perquisites: $6,000 in estimated annual car allowance; an estimated $4,000 in continuing education, fees and costs to maintain the Managers’ personal law license; and an estimated annual $17,500 of taxpayer funded premium payments for life, health, and dental insurances.
Then the City Manager became a “banker”.
When the City Manager was hired in 2008, he negotiated a “vacation bank” and a “sick bank”. His “vacation bank” of 4 weeks is valued at $15,100 and his “sick hours bank” of 1,500 hours is valued at over $141,300. In 2011, the taxpayer liability associated with these two “banks” totaled approximately $156,400.
As Donald Trump said, “You’re fired.” Ahh, think again- taxpayers. A lump sum severance payment for this City Manager could be as high as- $375,900!
The City Manager has the “financial insulation” of a friendly severance clause. If terminated for any reason except felony conviction or official mis-conduct or manager ‘abandonment of office’, taxpayers are on the hook for a lump sum payment equal to a full year of base salary and “any other benefits paid by the city’s fringe benefit ordinance”. The lump sum severance liability is calculated as follows: Base salary ($196,500), Insurances ($17,400), Car Allowance ($6,000), Vacation bank ($15,000) and Sick hours bank ($141,000).
Despite the incredibly lucrative employment contract terms described above, this City Manager successfully negotiated for even more “dollars”.
The City of Joliet agreed to file form IMRF 6.05 and back the manager’s claim that he was owed an additional 9.5 years of extra retirement credits. This would have added 9.5 credit years and $760,000 of credit “earnings” to the calculation of the City Manager’s future pension. Taxpayers would have been on the hook for this new massive lifetime pension liability.
Thankfully, the application form 6.05 was rejected by IMRF administrators. But, the City Manager wasn’t finished with his claim. He appealed it to the full IMRF Board of Trustees. The full Board then issued a final rejection saving Illinois taxpayers an incredible amount of money.
The City Manager of Joliet is re-defining “public servant”. There is a new term.
1 Click here to review Joliet City Manager Employment Contract
2 Click here to review the IMRF form 6.05
3 The “big ticket” compensation items (above)- base salary, contract deferred comp, vacation bank, sick bank, IMRF pension contributions- have all been confirmed via the Freedom of Information Act (FOIA). The “estimated amounts” in this post are good faith estimates based on industry information. Actual amounts could vary from estimated amounts +/- 10%. Therefore, the estimated items- car package, legal expenses, actual insurance cost vs. industry averages- could vary from estimated amounts (+/- 10%), but not be a statistically significant driver of more/less total compensation.