Given the size of the budget shortfall for next year and the amount that the city pays into the various pension funds, Mayor Parker’s proposal to pay less should not be a surprise to anyone.
City Attorney David Feldman and Finance Director Kelly Dowe already have asked firefighter pension executives to accept $14 million less than the city’s obligation to the pension system for the fiscal year that begins July 1. They plan to ask police for cuts as well, they said.
“We asked them to work with us to determine whether we could reduce the amount paid in, and I pledged that concessions made would offset cuts made to the fire department,” Parker said Tuesday.
Early this month Parker asked the fire department to cut $22 million from its $449 million budget as part of a larger set of spending targets issued to city departments.
Firefighter pension leaders who met with Feldman and Dowe at City Hall late last week said they were told that the city would be laying off between 200 and 300 firefighters, as well as closing some stations. They talked of the administration’s desire to reduce the pension payment by $14 million during the same discussion.
“We feel like it’s an ultimatum. The result is, from their perspective, to make the pension plan look bad so they can pass their budget,” said Christopher Gonzales, executive director and chief investment officer of the Houston Firefighters’ Relief and Retirement Fund. “They’re balancing the budget on the backs of the firefighters, and that’s unfair.”
With all due respect, I think the other city employees that have been furloughed or laid off would disagree with that characterization. Everyone knows that the trajectory the city is on with its pension obligations is unsustainable. The resolution will ultimately involve some combination of the city paying less, the firefighters contributing more, and pensioners (current and future) taking less. It’s just a matter of how messy it is getting there.
UPDATE: I received this statement from HPFFA President Jeff Caynon, which disputes the Mayor’s claims about the budget. It reads in part:
“A few months ago, firefighters negotiated with HFD to restrict vacation use and adjust the department deployment model which saved the city about $5 million. The mayor then recently ordered HFD to cut its budget by five percent – or about $25 million. The Houston Firefighters Relief and Retirement Fund (HFRRF) recently lower the city’s contribution thereby saving the city of Houston $13 million per year for the next three years.
“None of the $13 million pension reduction was counted toward the $23 million budget cuts ordered by the mayor. In fact, during recent discussions the mayor’s financial director expressly notified firefighters that any savings related to pension reduction would not count toward the city’s imposed HFD budget cuts.
“The mayor’s comments today were misleading, but they also continue a pattern of behind-the-scenes pension and layoff threats that contradict the administration’s statements about their public safety commitment. The mayor also has attempted to pit police and firefighters against each other by increasing the city’s contribution to the police pension without argument while failing to acknowledge the efforts of firefighter’s pension.”
Click the link for the rest.