Chicago Union Leaders Grab Millions in Pension Loophole: MyFoxCHICAGO.com
Here’s the nuts and bolts of the issue, via myFoxChicago.com:
Take Tim Foley, who’s the head of International Brotherhood of Electrical Workers (IBEW) Local 134. Under a little-known provision of the state pension code, union officials like Foley who worked for a brief time as City of Chicago employees are entitled to purchase credits in the city’s pension fund equal to their service time and salary at the union.
So in 2008, Foley paid $347,000 out of his own pocket to purchase pension credits from the City. That’s a lot of money, but by doing so, Foley ballooned his pension from just a little over $20,000/year to $105,000/year.
That increase of $85,000/year is enough money to pay off his initial investment in just four years. So in essence, Foley bought himself an annuity guaranteed to return 25-percent a year for as long as he lives — potentially millions of dollars.
Read the whole story here.
Yes, it’s shocking but, evidently, absolutely legal. There’s no use shouting about “union” outrages like this when Big Business and Crony Capitalists do it all the time.
Why is this shocking, Ken? If the union leaders invested the money in IRA’s, they would probably do better. $347000 invested at 10% a year would compound to $902027 after 11 years. The city gets to keep the money and they give him the interest, or in this case a little less than the interest.
Except that taxpayers are footing the bill here, not some big corporation who gets money through voluntary transactions with consumers.
How about the city guys on the other side of the agreement,,,Just wasn’t one sided greed.. Dock those other city pensions to pay these union guys….