Harvey To Lay Off Workers After State Funds Withheld Over Pension Debt
CHICAGO (CBS) -- City employees in south suburban Harvey, including about 30 people working in the police and fire departments, are facing layoffs, because of more than $1 million due to its police pension fund.
Those pink slips could come by Friday, CBS 2's Vince Gerasole reports. The city won't confirm the exact number of safety personnel losing their jobs, but they say their hands were forced.
The city has sued the Illinois State Comptroller's office, seeking to force the state to release $1.4 million in revenue being held to satisfy its police pension debt.
City officials said they need the money to cover day-to-day bills, but a judge has ruled the state acted properly to hold the money to cover pension costs that have gone unpaid for years.
Comptroller Susana Mendoza has said her officer was just following the letter of the law by withholding the money.
"The legislature passed a law allowing pension funds to certify to our office that local governments have failed to make required payments to pension funds. The local government has a chance to respond. Once it's certified, the law requires us to redirect the payments to the pension fund - the Comptroller's Office has no choice," Mendoza's office said in an email. "A judge ruled Monday in favor of the Harvey Police Pension Fund and against the City of Harvey's request to stop this process, saying the funds were appropriately put on hold. The Comptroller's Office does not want to see any Harvey employees harmed or any Harvey residents put at risk, but the law does not give the Comptroller discretion in this case."
She said it's up to the city and the police officers' pension fund to negotiate a deal that would allow the state to release funding for the Harvey payroll.
Harvey Mayor Eric Kellogg accused Mendoza of "playing politics."
"We certainly have managed the situation, avoided massive layoffs. Now Comptroller Mendoza wants to stifle the city's public safety with regards to playing politics," he said.
Harvey planning department employee said the city already is paying its pension obligations.
"Why would you hold our money? We are paying the pension," she said. "Half of our salaries are pension. We've got half of the budget goes to people who don't work, and the other half goes to those of us who do work."
Without the funding being held by the state, Harvey officials said there might not be enough money to continue making payroll after Friday.
