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Paradox City

Calumet City is struggling economically, but the elected leaders in town sure aren’t. The mayor and aldermen get generous salaries, and perks that include free health insurance for life.

By Andrew Schroedter/BGA

November 23, 2012 12:56 PM

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Calumet City Mayor Michelle Markiewicz Qualkinbush

In Calumet City, the unemployment rate tops 11 percent, well above the state average.

Nearly 20 percent of local families live below the poverty line.

And taxes are rising to meet soaring pension costs for municipal workers.

The picture is relatively bleak – unless you’re an elected leader in town.

An analysis by the Better Government Association found the full-time mayor and seven part-time aldermen in Calumet City are the beneficiaries of unusually generous compensation, courtesy of the south suburb’s struggling tax base.

Among the BGA’s findings:

  • Mayor Michelle Markiewicz Qualkinbush’s pay and benefits top $180,000 annually, according to documents obtained under the Illinois Freedom of Information Act, and interviews.

Last year, the mayor’s compensation included a salary of $74,194; a "longevity" bonus of nearly $20,000; a $500,000 life insurance policy with an annual premium of more than $20,000; an expense account of $19,500; about $16,660 in pension fund contributions; $11,000 for attending "special" meetings; a vehicle allowance of $7,740; $6,000 to handle liquor licenses; and at least $6,000 for health care coverage.

Qualkinbush’s pay and perks are expected to stay roughly the same this year.

  • Aldermanic pay and benefits last year topped $56,000, roughly double the median earnings for working residents in town, according to the U.S. Census Bureau.

Aldermanic compensation varies based on the length of time an alderman has been in office, among other factors, but in 2011 included an annual salary of nearly $16,000; up to $12,000 for "special meetings"; an $8,400 expense account; $6,000 to chair a committee; at least $6,000 for health care coverage; pension fund contributions of about $5,000; up to $4,000 in longevity bonuses; and $3,000 to cover life insurance.

In addition, each alderman is allowed to hire a personal secretary of his or her choice – and it’s often a relative. Each secretary receives pay of $7,200 a year, but no benefits.

  • Health care coverage for elected leaders is overly generous by most standards in the private and public sectors, according to experts interviewed by the BGA.

The mayor and aldermen, and qualifying family members, aren’t required to pay premiums for health or dental coverage, though they pay deductibles or co-pays for prescriptions.

Even after they leave office, the mayor and aldermen, if they served at least two terms, can receive health care coverage with no premiums until they are eligible for Medicare; at that point, they and eligible family members can receive free "supplemental" insurance from the city.

Some of those benefiting from this largess acknowledge it’s been over the top, and city officials are scaling back certain perks.

For instance, in September Calumet City leaders changed the rules so city council members who take office after May 1, 2013, will no longer receive health insurance – but the current board won’t lose its coverage.

"It had to stop somewhere and it did," Ald. Thaddeus Jones says.

City spokesman Tom Mannix said Calumet City is self-insured and doesn’t buy health insurance from a third party, and therefore is unable to disclose how much the city pays each year to insure the mayor and aldermen and their families.

However, one city official estimated the annual cost is $6,000 to $19,500 per elected official.

Meanwhile, the city council also eliminated Qualkinbush’s vehicle stipend and slashed her expense allowance by about half. But those changes also won’t go into effect until next May.

Spared the chopping block were payments that Qualkinbush and aldermen receive for special meetings, held in addition to the regular bi-monthly city council meetings. Officials are paid $660 a meeting for the first 12 special meetings they attend in a year, then $330 for each special meeting thereafter.

Not only is that an apparent conflict of interest – after all, the special meetings are called by the people who get paid to attend them – it’s also costly. The mayor and aldermen were paid a total of $95,394 for special meetings last year and $66,677 in the first eight months of 2012, according to public records.

Qualkinbush, the mayor since 2003, declined an interview request. But in an email to the BGA she defends her pay and perks, noting she also handles some purchasing and administrative tasks, thus eliminating the need for additional full-time employees.

"I serve on a full-time basis unlike many other communities where the mayor is part-time and there is a full time city manager," she writes. "It is my understanding that south suburban municipalities with part-time mayors and full-time managers expend similar amounts of monies roughly equaling my compensation."

In other words, her "salary is high but she’s saving the city money, too," says Burt Odelson, a Calumet City attorney.

A survey of Calumet City’s municipal neighbors reveals that they’re far less generous to their leaders when it comes to salaries and benefits.

In nearby Lansing, Norman Abbott also is a full-time mayor, but his total compensation last year was just over $107,000, which included a salary of nearly $97,000, a pension contribution of just over $10,000 and a $30,000 life insurance policy that carried an annual premium of about $100, officials said. Abbott qualifies for village-subsidized health insurance but says he doesn’t accept it because he doesn’t need it. He says he doesn’t accept other perks, including a vehicle stipend, because he considers them excessive.

Meanwhile, Don De Graff is the part-time mayor of South Holland, and qualifies for a $2,200-a-year salary and an expense account of $2,400. De Graff accepts neither, according to Village Administrator Jason Huisman, because he already gets paid for sitting on the Metra board.

Homewood Mayor Rich Hofeld is also part-time, and for his duties is paid $3,700 a year, plus an annual pension contribution of about $60, officials said. Hofeld says he donates his pay each year to charity. "It’s not my money, I feel it’s important to return it," he says.

On the other hand, aldermen in Calumet City, with a population of roughly 37,000, say it’s important for the public to know they’re not overpaid. To qualify for a pension through the Illinois Municipal Retirement Fund, each alderman must perform at least 600 hours of Calumet City-related service a year, but some officials say they work much more.

"It’s labeled a part-time job but it’s not a part-time job," says Ald. Antoine Collins, who also makes $41,314 a year as a manager in Thornton Township’s food assistance center. "For the hours I put, [the compensation] is fair."

But Jones, who also is a Democratic state representative, said another perk, personal secretaries for aldermen, should remain intact.

secretaries are vital but suggested other perks such as special meeting pay and free life insurance could be axed.

"That money could be better spent on other programs," he says.

The BGA has previously reported on other questionable conduct within Calumet City’s municipal government. For instance, the BGA found a contract that went to an accounting firm owned by the suburb’s finance director. Separately, the BGA discovered a city attorney with ties to Qualkinbush stands to collect a six-figure pension through IMRF, even though he has his own private law practice and doesn’t work for the city full-time.

This all comes against a dreary financial backdrop.

The suburb’s tax levy shot up nearly 5 percent last year in part because of rising costs, and Calumet City’s unfunded pension liability now stands at $111.6 million, according to the Cook County treasurer’s office.

More than 18 percent of families in Calumet City live below the poverty line, or $23,021 a year for a family of four, according to the Census Bureau.

Though unemployment in Calumet City has fallen since last year, it still tops the statewide rate, 11.2 percent versus 8.1 percent, according to the Illinois Department of Employment Security.

And the median single-family home sales price declined by more than two-thirds to $28,000 in September, from $86,900 in the same period in 2009, according to interviews and public records.

Given the community’s troubles, the perks for elected officials are particularly jarring, says Brian Enright, a partner at 3C, a Chicago-based compensation consulting firm that isn’t involved with Calumet City.

"That local government is performing terribly," Enright says, adding: "No one, nowhere is getting health care in a part-time job."

This story was written and reported by the Better Government Association’s Andrew Schroedter. He can be reached at (312) 821-9035 or aschroedter@bettergov.org.

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