Excerpts from the DailyHerald.com:
A legal battle is unfolding between the Barrington Countryside Fire Protection District and the village of Barrington over a $1.2 million debt related to a former joint firefighters' pension fund. The lawsuit, filed by the village, claims that the fire district has failed to pay its share of pension obligations, which were established when the two entities separated on December 31, 2013.
The fire district, however, disputes this claim, stating in an audit that it has no liability for the pension fund. According to the lawsuit, the pension fund was already $1.9 million short at the time of the split, and village officials argue that the fire district had previously agreed to cover 64.25% of "fire services costs," including pension expenses. This agreement, they say, meant the district owed over $1.2 million at the time of the separation. In addition, the village is seeking more than $800,000 in long-term disability insurance payments.
The financial burden could be even higher. The lawsuit also mentions that the fire district requested a recalculation of the pension liabilities using a state-mandated funding formula, which increased the estimated cost to over $2 million. A court will now have to decide whether the fire district owes the village any money—and if so, whether it’s $1.2 million or the newly calculated $2 million figure.
Village Manager Jeff Lawler said, “This is unfortunate, but it’s their doing. For 19 years before the split, they paid under this formula.†He added that the village has sent multiple invoices to the fire district since the separation, but none have been fully paid. Last June, the village returned a $14,000 check from the district, citing insufficient funds.
Before the split, the fire district paid the village to provide fire protection services. However, in the years leading up to the separation, the district's board became increasingly dissatisfied with how the village managed the fire department. When the intergovernmental agreement came up for renewal, both parties decided to part ways, splitting equipment and other assets.
Lawler noted that the separation agreement clearly stated the fire district would be responsible for all unfunded pension obligations, which he estimates could be in the seven-figure range. The lawsuit also includes a request for reimbursement of legal fees incurred during the village’s efforts to recover retirement and disability benefits from the district.
According to the fire district’s most recent audit, the district has more than $2.5 million in reserves. It received the majority of its $5.9 million in revenue—$5.6 million in 2014—from property taxes. However, the audit shows that the district spent over $6.2 million in 2014, raising questions about its financial management.
The audit acknowledges the village’s invoices but maintains that the fire district has no liability for the pension fund. It offers no clear path forward for resolving the dispute. On the issue of long-term disability costs, the district argues that payments should only be made when the village pays out claims, rather than assuming a lifetime cost that may end up being lower.
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