Monday, November 07, 2016

Houston PD pension mess could spur officer departures. Should we care?

Houston PD could see more officers retire soon as a result of the proposed pension deal Mayor Sylvester Turner negotiated with the unions, reported the Houston Chronicle last week. City leaders say "huge numbers of first responders are eligible to retire" immediately. In all, "37 percent of police officers and 25 percent of firefighters today are eligible to begin drawing pension checks." The fear is that ending super-generous, budget-busting benefits will spur more officers to leave sooner than later.

OTOH, doing nothing isn't an option. And the new recruits who replace aging officers will cost the pension fund (and city budget) less. Even so, it's unlikely that the deal cut will resolve the problem. The new deal slightly boosts employee contributions and lowers the expected rate of return from 8 percent to 7, but IMO that's still a wildly unrealistic number that I don't believe can be sustained for 30 years. If I'm right, the  pension fund won't be solvent in three decades, as promised.

The article expressed a particular worry that the department will lose staff at the commander level, but in Grits' view that should be the least of their concerns. Let's face it: Has the department really been run so well that they can't afford for top managers to be replaced?

Houston relies on defined benefit plans for officers which are far more generous than anything seen these days in the private sector. Under the new deal, many officers could retire when their age plus years of service equals 70 and then collect full benefits for the rest of their lives. Who else gets to retire at 50 with a guaranteed income for life? Certainly not most taxpayers in Houston footing the bills.

Bottom line, like so many US cities, politicians in Houston promised police and firefighters unions far more in benefits than taxpayers could afford, drastically underfunding pensions and assuming way-too-high rates of return on investment. Now, the politicians who made those promises are long gone and those financial chickens are coming home to roost. The transition from this unsustainable scenario will not come without disruption, and won't be limited to Houston, either.


Gunny Thompson said...

Grits, In answer to your question,"Should we care?": You bet your Skippy! Is there tea in China? Yes to both.

As noted in a previous post regarding Dallas police, in Texas, police are not entitled to an at-will employment preference and are only allowed to resign when the agency has appointed a proper replacement. Additionally,local governments are not allowed to approve special benefits in the form of meet-and-confer concessions and union representation. The current policy of allowing special concessions are in fact,an extortion on the taxpayers.

Gritsforbreakfast said...

Gunny, you're confusing what you think SHOULD be the case with what is in fact true. And the fact is, cops can retire when they want and meet-and-confer concessions to unions are legal, even if I agree that they've been unwise.

Gunny Thompson said...

Grits, I think what are the facts and not opinions is that Texas, in accordance with Tx Gov't Code,Sec. 617.002, prohibits public employee collective bargaining and that include peace officers.

One additional fact, as public officers, they are restricted from residing outside of the jurisdiction of their employing agency. To maintain their primary residence outside of that of their of their employing agency is an automatic resignation and removal from office. Does the expression: "No one Is Above-the-Law, mean anything?!!"

Gritsforbreakfast said...

@Gunny, other statutes authorize "meet and confer" in civil service cities so it's just not true that those agreements are illegal. Also not true they must maintain residence in the jurisdiction. It might be nice, but it's simply not a legal requirement.

Everyone is entitled to their own opinions, but not their own facts.

Anonymous said...

Many officers of DPD, HPD, SAPD and others live outside of the city limits of where they are employed. Most of them lived outside of the city jurisdiction when hired, so no, the law does not prohibit them from living outside of the city where they are employed.

Gunny Thompson said...

Grits, in respect to you, I accept your personal opinion, however, they are not facts. Laws that are in conflict are a nullity. I certifiably don't have the last word on this matter, but, I have not heard of a court ruling that provide a waiver of the intent of the Legislature. Whether cities are allowed to ignore the law has to be determined.

Anon @ 10:31 AM; thanks for your position, however, peace officers, in Texas, are considered public officers, Ex parte, Tracey, 93 SW 538(1905), Crim), as such, they must meet constitutions; residential requirements,which in part, states:

To be eligible as a candidate for, or appointed to a public office in this state, a person must have resided continuously in this state for 12 months and in the territory to from which the officer is appointed for six-months immediately preceding the date the appointment is made and satisfy any other eligibility requirements prescribed by law for the office {Texas Election Code, Section 141.001(a)(%), (E);(6)] Just Saying!!!

Gritsforbreakfast said...

Gunny, the civil service code authorizes an exception to the prohibition on collective bargaining you're citing to authorize "meet and confer" in jurisdictions which have adopted Chapter 143 of the Local Government Code. I was around when it passed - 97/99-ish. The laws aren't in conflict. Your opinion about the law is in conflict with reality. Also whatever your opinion, police officers can and do live outside the jurisdictions they serve. I think it would be a good change to require them to do so, but you're just flat wrong that they're required to do so now and no judge has ever interpreted the law thusly.

What's going on? Has the Trump thing spawned some new era of fact-free debate where we just make up stuff and ignore reality? Are we all Alex Jones, now? Honestly, if you keep just asserting false things as facts, I'll first ignore you and ultimately, if it continues over time, just delete them. Please stop.

Anonymous said...

Meet and Confer is not collective bargaining, the employees having no ability to strike, engage in work stoppages or slowdowns. From what I've read by people that know what they are talking about, including respected professors at Rice University, the biggest problem for places like Houston are groups that do not have such agreements in place, their firemen afforded lavish pensions akin to places like Austin while their police friends get much less and under Meet and Confer.

But no city or county in Texas has a residency requirement, a few places asking an attorney general awhile back if such a provision would be legal and the issued opinion claiming no. If this has changed under AG Paxton, by all means provide a cite. I'd like to see such a cite for anything at all suggesting employees in Texas could not retire as they saw fit, Dallas has had a surge in retirements lately and no hope of replacing the employees over the next year or two. In Houston, previous benefit cuts resulted in mass retirements without any problems either, all of this public knowledge.

The benefits are not as lucrative as other cities offer but per the comments in local articles, new provisions will force many to stay to get a minimum benefit, command staffs made up of political hacks so Houston will be better off replacing as many as will leave. The resulting savings can then be used to build more libraries, after school programs, or whatever else is desired, the remaining employees coming to grips with what their city thinks they are worth. May Austin soon follow!

vegas0012 said...

This post and the comments, in particular, are not bound by facts and logic. I'm reading something akin to an infowars analysis of current events.

Grit, do you live in the city of Houston ?