City No Closer to Solution on Police, Fire Pension

Dallas Fire Department truck | Image by Wangkun Jia

The City of Dallas still does not have a plan to fix the Dallas Police & Fire Pension System, with City Manager T.C. Broadnax having rejected potential solutions proposed by local first responder unions.

City officials only have another year before they must prove to the State of Texas that they have a plan to fix the pension.

“The state of that pension right now looks terrible,” said Michael Granof, an accounting professor emeritus at the University of Texas at Austin,” reported The Dallas Morning News.

As previously covered by The Dallas Express, the Dallas Police & Fire Pension System fund has $3 billion in unfunded liabilities after several years of ongoing mismanagement.

“It’s less than 50% funded, the city and employee contribution is very high, and there don’t appear to be many obvious solutions,” Granof told DMN. “The situation is not improving, it’s getting worse.”

The presidents of the Dallas Police Association (DPA) and Dallas Fire Fighters Association (DFFA) have been advocating for putting upcoming bond funds toward the pension and delaying the bond election. A delay could allegedly give the City of Dallas time to boost its bond rating, which would consequently result in more bond money, but others claim interest rates preclude this route.

“We recognize the recommended solution for the police and fire pension and employee retirement fund may not include any city bonding, but because of the size and urgency of the issue, we believe it is inappropriate to proceed with a general obligation bond until we know these funds are not needed to secure the pension plans,” said DPA president Mike Mata and DFFA president Jim McDade in early October, per DMN.

However, City Manager T.C. Broadnax has rejected Mata and McDade’s suggestion.

“In recent days, a false narrative has begun to develop that the City Council must choose between having a General Obligation Bond election in May 2024 or addressing the Dallas Police and Fire Pension System … unfunded liability,” he claimed in an October 6 memo to Mayor Eric Johnson and City Council.

“This is not an either-or decision,” he wrote. “I am committed to both protecting the pension benefits of our first responders as well as addressing the infrastructure needs that our residents demand and deserve.”

Broadnax said he recommends the upcoming bond program “not exceed $1.1 billion with an election in May 2024 to address the significant infrastructure needs throughout the city.”

“In order to have a May 2024 election, City Council will be asked to call the election no later than mid-February, which is more than four months from now,” he said.

The Ad Hoc Committee on Pensions and the 2024 Capital Bond Bond Task Force are currently developing recommendations for the City Council that will be presented in January.

“At that time, the City Council will be able to make a much more informed decision instead of conflating these two critical but distinct concerns,” Broandax wrote.

James Quintero, director of the Center for Local Governance at the Texas Public Policy Foundation, stressed the importance of properly fixing the pension.

“This is an issue that can impact a city in a number of ways, including being a detriment to attracting new recruits,” he said, according to DMN. “Candidates can look at the situation and come to the conclusion that the benefits system offered by the city of Dallas isn’t sustainable and not going to be there when they’re looking to retire.”

“Because of that, they’ll just look elsewhere for police and fire jobs,” Quintero added.

As previously reported by The Dallas Express, the Dallas Police Department has been struggling to contain a rise in murders. DPD maintains a force of fewer than 3,200 sworn personnel, roughly 800 less than the 4,000 recommended by a City analysis.

The effects of the shortage can be seen above all in Downtown Dallas, where crime rates are considerably higher than in Fort Worth’s city center. Downtown Fort Worth is reportedly patrolled by a designated neighborhood police unit working alongside private security guards.

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