Unwise Investments Still Weigh on Police, Firefighter Pension

Dallas Pension
Dallas police and fire units | Image by Dallas Police and Fire Pension System/Facebook

Amid a serious staffing shortage at the Dallas Police Department, police and first responders in the city are still feeling the repercussions of pension moves from the past, according to a report by KERA News:

“Risky investments from seven years ago appear to still be hurting the Dallas Police and Fire Pension System. While a deadline to submit a plan to fix the billions in unfunded liabilities looming, a city contractor says its time to make better investment decisions.

“Dory Wiley is the president and CEO of Commerce Street Investment Management and worked on an initial analysis of the Dallas Police and Fire Pension System’s investments. Wiley told the city’s Ad Hoc Committee on Pensions that the fund was performing below average, compared to other systems in Texas.

“Wiley presented a chart with 33 Texas retirement funds, including Dallas’ sworn and non-sworn systems included. Dallas’ public safety fund ranked last in 10-year net returns across the state.

“’The bottom two are Dallas police and fire,’ Wiley told the committee during Thursday’s meeting. ‘One with the private assets and one [without] the private assets.’

“Wiley said the public safety fund has done a good job with investments in public equity — or stocks. As of June 2023, the fund has received over 8% in returns. That’s more than other peer cities, according to Wiley’s presentation.

“’But having said that, we go to the private equity and then that’s where the underperformance is,’ Wiley said. ‘Part of that is legacy assets … they’ve been dealing with them for the last seven years, I know they’re still dealing with them.’

“Those legacy assets include real estate investments that landed the pension fund in the situation it’s in now. Last year, those assets returned just over 4% compared to 17% in Houston and other similar-sized funds in Texas.”

To read the entire article by KERA News, please click HERE.

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