We’ll see about this.
With the city of Houston facing huge and rising pension costs, Mayor Annise Parker on Thursday unveiled a proposal to put new firefighters in a separate, less generous plan that would do away with expensive automatic cost-of-living adjustments.
The move would not affect current firefighters covered by the Houston Firefighters Relief and Retirement Fund, long insulated from reform by the Texas Legislature. It would be an unprecedented change to new firefighters’ pensions and would mark the latest chapter in the contentious relationship between Parker and the city’s firefighters. There are two lawsuits pending between the city and the pension fund; the fund is expected to sue the city over the latest proposal.
Creating a separate plan, Parker said Thursday, is her only recourse for reining in pension costs. Though the city long has had the ability to create the separate pension plan for new firefighters, Parker said, she has waited to do so until now because she wanted to attempt broader pension reforms first.
“But if I can’t solve that one – Legislature won’t help, I don’t have the ability to negotiate – let’s set up a separate pension and create one that is fair and sustainable for both sides,” she said.
Todd Clark, who chairs the fire pension board, told a City Council committee on Thursday that the proposal would “put a firefighter on welfare,” hurt morale and weaken the department’s ability to retain and recruit staff.
Council members Larry Green, Jerry Davis and Jack Christie pushed back, asking Clark whether there was room for compromise.
“I understand that you think the fire pension doesn’t have a problem, but as someone who has just gone through the budget process for the city of Houston, we have a problem,” Green said. “Our objective is not to become Detroit. What’s the solution?”
Clark responded, “The best thing you can do is just come up with the money. It’s not my job to balance the city’s budget. What the city should be doing is finding ways to meet the promises made, not trying to cut the benefits. No changes need to be made to our system. We’re a very strong and healthy pension system.”
The Mayor’s press release, with more details about her proposal, is here. I think Todd Clark is correct that the current pension is well-funded and in better shape than many others, but I think he’s got a tough sell politically to say that the city just needs to suck it up and pay whatever they’re told to pay, over which the city has no control. I’m not commenting on what’s right or wrong here, just saying that’s a tough sell. On the other hand, CM Costello, the biggest pension hawk on Council, wants this applied to current firefighters as well. That would have been the Mayor’s preference too, but she never got anywhere with the pension fund or the legislature, so it’s also a tough sell. There’s a dispute over whether this proposal can be implemented by Council or if it requires legislative action like any change to the plan for current firefighters would, so if it does get adopted expect there to be a lawsuit.