Mayor Sylvester Turner
A state district judge on Friday dismissed Houston firefighters’ lawsuit challenging the constitutionality of the city’s pension reform package, removing a potential barrier to the city’s efforts to solve a 16-year fiscal crisis.
State District Judge Patricia Kerrigan granted the city’s request to dismiss the case while denying firefighters’ motion to temporarily block the state law, known as SB2190, from going into effect Saturday.
[…]
Houston Firefighters’ Relief and Retirement Fund Chairman David Keller, meanwhile, said he was disappointed, adding that the board would discuss next steps with its legal team.
Kerrigan’s order gives the pension board the option to refile its lawsuit, which argued the reform law infringes on the fund’s exclusive right to select its own actuaries and choose the actuarial assumptions that will be used to determine contributions into the pension system.
See here for the background. I presume this will get appealed, but I kind of doubt it will get anywhere. One may wonder how it is that the relationship between the firefighters, who endorsed Turner for Mayor, and the Mayor has gotten so combative. I suspect it is more likely that the firefighters believed that despite Turner’s promises about pension reform he didn’t really mean to affect their pensions than it is that Turner was dishonest with them about what he intended to do. The firefighters, with some justification, have felt invulnerable for a long time. Having that come crashing down around them has got to be a tough thing to take. One also wonders how much previous Mayors, nearly all of whom have had tumultuous relationships with the firefighters, are getting a bit of grim satisfaction out of this. I mean, if the firefighters had ratified the contract agreement that their leadership agreed to with Mayor Parker in 2014, and if they had worked with Mayor Parker to pass a pension reform plan back in 2013, we wouldn’t be having any of this conversation now. Maybe they wouldn’t be any better off than they are now, but it’s hard to see how it would be any worse for them. I know, hindsight is 20-20, but surely some of this was foreseeable.
HFD’s pension board had made a previous pension deal with Mayor Parker a few years back, carried by Turner in fact, who had helped them with previous legislation for years. Since it was more of a deferment to prevent any actual cuts for a period of years, the legislature and just about everyone else declined. Parker’s reasoning was that at least it amounted to a first step, presumably opening the door for more productive changes in the future while most at HFD would’ve admitted it was just a means of preventing benefit cuts until a mayor more favorable to them was elected. It’s a good thing it didn’t pass because the following two years saw their investment returns completely tank, this year has been much better for them per Todd Clark (their former pension guru). But Charles refers to the pay contract they turned down which had nothing to do with the pension contract since different people comprise the pension and union boards.
As far as the revised narrative that Turner promised he wouldn’t cut benefits that was told all over the state capital for the first six months of this year by firemen, that is simply not true. Turner never publicly made any such promise and even the HFD pension board approved a lot of cuts last year as part of the deal, they just hemmed and hawed on providing specific data so they got mowed over. They then drew lines in the sand, fought, and lost but to this day you will see scores of comments on social media telling the world how Turner “promised to leave our pensions alone” by them.
The basis for the lawsuit was that the pension board believed it had the power to determine assumptions and contributions, not that it could determine the actual benefits though. It also demanded the city increase payments by over 50%, something originally denied by a couple of RINO’s out there with their own political blog, even while major cuts were made to benefits. If HFD does better than the 7% returns they are required to make, that is good for their fund moving forward and if they don’t, they could be subject to further benefit cuts or need to pay in more but who determines the amount is going to be the party that takes the lumps when things don’t work out so they should be happy with the city taking over some of that responsibility.
Last thing, last week city council voted to keep paying HFD when their contract expired but under state law terms that are not as lucrative. So in about the span of a month they had a reduction of further pension benefits moving forward, a denial of their pay raise demands, and even a cut to pay since they couldn’t agree to a new contract. To me, that sounds like that loss of invulnerability they felt gave way to a cold shower wake up call. The only good news is that the city increased its offer to almost 10%, a bigger raise than any non-executive group has received in years so they should take it now before those bond elections take place or I suspect they will be SOL.