The city of Dallas has settled on a plan to remedy billions in unfunded police and fire pension liabilities. The plan, which will be sent to the state’s pension review board in early November, includes budgeting for a "one-time" stipend for retirees.
But it's up to the council when or if those funds are issued.
City staff's recommended plan originally factored in the stipend without council approval. That was before the Dallas Police and Fire Pension System tried to submit their own funding plan to state regulators — and then sued the city.
Council members said during Wednesday's meeting that the plan with the stipend approval, factors in the uncertainty caused by the pension fund executives.
“The way this has been structured is in a way that takes into account the fact we’ve been sued, by what is supposed to be one of our partners,” Dallas Mayor Eric Johnson said during the meeting. “We want to make sure we are not getting out of line in terms of what we may, or may not be, required to do at some point.”
Johnson said the city would get the job done — and added he would “rather not be the mayor of this town than to break a promise” to the public safety retirees.
Jaime Castro, the president of the Dallas Police Association, voiced outrage over the changes made to the plan, before the council voted on it.
“I’m disgusted and angry beyond belief, to hear what the city pension plan proposal will be,” Castro said during Wednesday’s meeting. “We were asked to work in good faith with both sides, and we did.”
Castro said what happened in 2017 — when the Texas legislature had to step in to help keep the fund afloat after risky real estate investments nearly caused the system to collapse — was a “brutal drag-down war.”
He said if the plan was approved by council — it would “essentially redeclare a pension war against all first responders.”
“I cannot, in good conscious, advocate for this department, if this plan passes,” Castro said. “The message will be clear: If you don’t need a raise in 22 years after you retire, in today’s economy, the city of Dallas is for you.”
Elected officials thanked those who showed up to advocate for the pension system — and told them to direct that same energy toward the pension fund's board.
“You can keep emailing council members but you also need to email your fund’s staff and board,” District 13 Council Member Gay Donnell Willis said. “Press your board and staff to set egos aside and work on ways to improve results.”
Willis said the fund’s board is moving slow and it “doesn’t sound like they’re open to the expertise of others.”
“Doesn’t that concern you?” Willis asked. “It concerns me.”
District 12 Council Member Cara Mendelsohn was the only council member to vote against approving the city’s plan. She has been vocal about the need to increase benefits and cited concerns over police and fire recruitment — and retention.
“Since 2017, before nearly everyone around this horseshoe was elected, city staff knew this day was coming,” Mendelsohn said. “So I don’t understand why we aren’t financial prepared.”
Mendelsohn said the city should be able to immediately start paying the actuarial determined contributions — instead of a five year “step-up” period recommended in the city’s plan.
Ultimately, the council voted 14-1 in favor of the plan with most members voicing their support and noting actions taken against eh city by the fund’s executives. The plan is due to state regulators on November 1.
Got a tip? Email Nathan Collins at ncollins@kera.org. You can follow Nathan on Twitter @nathannotforyou.
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