Big Jolly Politics

politics in Harris County and Texas

Houston Firefighters’ Relief and Retirement Fund

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Update to My Fellow Firefighters on Pension “Reform” Developments [HFRRF]

houston firefighters

by David Keller

There’s been so much going on in Austin that it is hard for me to find a starting place. So let me start with you and I’ll ramble on from there.

I have never been so proud as a firefighter than on March 27 when hundreds of you showed up in Austin to testify on House Bill 43. Everyone was so polite, well informed and eloquent in their comments to the House Pensions Committee. It’s hard to imagine how the bill could ever have been reported favorably out of committee. You did your job and you did it well.

But now you know what we’ve been up against: a full-blown effort by the City to make firefighters fill a pension hole we didn’t dig. The City has been pursuing that course because we have money. We’re the best funded pension system in the state when compared to other plans with more than $1 billion in assets. The City has needed its ‘fix’ to come from somewhere. The City’s obligation to your pension is only 18{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of the total owed to all three systems, but the City has been asking HFRRF to take on 35-40{997ab4c1e65fa660c64e6dfea23d436a73c89d6254ad3ae72f887cf583448986} of the total cuts. Again, the money had to come from somewhere. Talk about punishing success.

And that’s why I’ve been spending so much time in Austin, telling lawmakers your stories. It’s been hard because the truth has been twisted in so many ways. Take for example this baloney about our Board approving the City’s draconian cuts in October. Nothing is further from the truth. Our Board voted in October to continue discussions in hope of reaching mutually agreed upon legislative language. In every subsequent meeting those terms were altered or more were introduced. How do you agree in October to one thing and then get entirely differently terms in March? Well, that’s exactly what happens when you deal with the City.

Thankfully, with your help, we helped lawmakers understand this dynamic. The simple fact that Senator Huffman was working with us so diligently in the last two weeks on Senate Bill 2190, even while you were testifying in the House, reflected that at least one lawmaker understood what had happened. We hope you do also.

Today’s media barrage is more of the same. Lawmakers are being pressured by Moody’s saying that Houston bonds will be downgraded if a draconian bill with big cuts to firefighters’ pensions doesn’t pass. Baloney. Houston’s other two systems can fix their problems through the meet and confer process already available to the City. And the City doesn’t need a vote to issue $1 billion in pension obligation bonds those other systems want. They can do it tomorrow (kind of). We’ve stayed out of that mess because, again, we’re one of the best pension funds in Texas.

So where are we going? It will be more of the same for the near future. Back and forth to Austin. Back and forth with lawmakers. We remain OPPOSED to the two bills, SB 2190 and HB 43 because they put too much burden on you. We oppose them because this ballyhooed corridor mechanism is probably unconstitutional, taking control of actuarial assumptions away from our Board. We think that’s wrong and the Texas Constitution does as well.

Please keep contacting your representatives and your brother and sister firefighters in other parts of the state. We’re not going to let up on pressuring lawmakers to realize the City of Houston has all it needs to fix its problems without deep cuts to firefighters’ pensions. Be there with us.

Faithfully submitted,

David Keller
Chair
Houston Firefighters’ Relief and Retirement Fund
Board of Trustees

4225 Interwood North Parkway  Houston, TX 77032-3866  281.372.5100 TEL  281.372.5101 FAX  1.800.666.9737  www.hfrrf.org

Bill King for Mayor

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Bill King Photo

Our City is at a breaking point: thousands of potholes line our streets, police are not solving serious crimes, and the city’s debt surpasses Detroit. Bill King recognized these problems long ago and is running for mayor in order to rehabilitate Houston’s core services – taking local government Back to Basics. The local media and other candidates have followed King’s lead in framing the issues although no other candidate has developed thoughtful, workable solutions – the others just restate the problems and make impossible promises.

As a Houston Chronicle columnist, King provided readers with intelligent arguments and solutions concerning the city’s infrastructure, mobility, police department, crime lab, fire department, and pension problems. King does not shy away from difficult issues and never hesitates to take an unpopular position. This distinguishes King from every other mayoral candidate: he is unafraid of the unions and will tackle the sacred cows, even if they make him unpopular with some folks.

Bill’s candidacy is changing the debate. The local media has picked up on King’s themes. The Chronicle continues to report and print editorials on the city’s pension and financial crisis. The police department woes are well documented and continue to percolate. The city’s infrastructure narrative shifted after King’s campaign focused on our poor streets and let Houstonians know that they deserved something better. The fact that local media is following King’s campaign issues demonstrates leadership. The next mayor of Houston must be a consensus builder with actual, workable solutions and the only candidate who fits this description is Bill King.

King’s commercials are successful too. Recent HRBC Poll and KHOU polls have King tied for second or firmly in second place. Bill has secured the endorsements of the C Club, Kingwood Tea Party, and over 100 Harris County Republican precinct chairs.

Watch one of his TV ads. Bill has articulated these ideas for years and he demonstrates his strong communication skills.

https://www.youtube.com/watch?v=0kQuqTey7EU

The biggest “endorsement” for King came from Annise Parker herself. Mayor Parker’s non-endorsement-endorsement of King speaks volumes.

Parker Tweet

Parker recently tweeted a statement indicating that she supports five candidates as her successor –Chris Bell, Stephen Costello, Adrian Garcia, Marty McVey, and Sylvester Turner. As you likely know, Costello is doing his best to pose as the “conservative candidate” while also advocating for the GLBT endorsement, HERO, and receiving the endorsement of Planned Parenthood.

parkertweet

My complaints about  Stephen Costello are well-documented. In 2009, he also posed as the “conservative candidate” by hiring “conservative” campaign staff members, showing up at Republican Executive Committee meetings, and arguing that city council needed an engineer to fix our infrastructure. Little did we know that his “fix” was the drainage fee. On September 15, Annise did us a favor and let us know that her “finance directors work for Costello.” While I could rest my case against Costello right here, I want to provide you with more information.

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Costello promises to hire 1,500 new police officers – with an asterisk. When asked about this campaign promise over the weekend, Costello explained that his plan to pay for these officers begins with the Texas Legislature shifting control over police and fire pensions to the local government. First, I always find it interesting that Costello says he is for local control of our pensions; yet, he supported and voted for the 2011 police pension agreement that specifically prohibited the city from lobbying the Texas Legislature for local control until 2023. Costello did get the police endorsement that year. Second, the Texas Legislature does not meet again until 2017. So, under Costello, plan with an asterisk, pension relief could not occur until after the 2017 legislative session. What happens until then? What if the Legislature does not pass the local control bill? Simply said, Costello is the antithesis of Bill King.

Bill King has been around the Houston area for a long time and I have known him for years. He has built several successful businesses and met a payroll. I know him to be an excellent lawyer and his legal acumen will be very important as mayor. It has been many years since Houston has seen a mayor that wasn’t owned by the police and fire unions and, quite frankly, Houstonians deserve Bill King – someone who will identify problems, offer solutions, and get things accomplished.

Yesterday, I attended an event where Annise was applauded for ridding the city of the homeless veterans, which made me wonder if everyone else in attendance was blind. Bill’s campaign is representative of how he will lead our city – with dignity, honesty, and true fiscal conservatism. King is truly in position to vie for a spot in the December runoff election.

Go vote for Bill and take ten or twenty of your friends with you. Early voting starts Monday. This is not a choice of lesser evils – I firmly believe that Bill is the only choice for our mayor.

 

ABC 13 KTRK and Mayor Parker

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I am appalled by the local television coverage of our mayor’s lack of fiscal responsibility. Undoubtedly, no one individual holds greater responsibility for our financial recklessness and our outrageous debt than Mayor Annise Parker. Let me explain why this is true.

Sure, there is blame to go around but Parker has been in control for 18 years of continuous service: six as a councilman, six as City Controller, and six as Mayor. Certainly, for the last 12 years, Parker had direct control over the City of Houston’s finances. Directly prior to serving as Mayor, Annise Parker served as Controller, which is the person responsible for the city’s fiscal management and financial reporting. The purpose of this article is to point out the falsehoods in Annise Parker’s comments and the comments by ABC13 KTRK concerning Parker’s efforts to lobby the Texas Legislature for local pension control.

Yesterday, Parker blamed the City of Houston pension crisis on the Legislature and claimed that she was unsuccessful in her efforts to gain local control of our pensions – and, ABC13 KTRK backed up Parker’s false claim. In direct opposition of this claim, Annise Parker signed an agreement with the Houston Police Officer’s Union to not lobby the Legislature for local pension control. Now you have to really think about that. Our Mayor went on TV to perpetuate a lie for no other reason than to protect her legacy. This can only be done with duplicity by ABC13. Our local media bears responsibility for the financial condition of the City because of this type of reporting and total failure to investigate false claims by city leadership.

Houston local media has never held the Mayor responsible for our fiscal condition. Annise Parker is the most responsible for many reasons and her deal with union bosses to not support local control is just one example. Parker has blessed or agreed to one bad deal after another for 18 years in exchange for the police endorsement. This is exactly why the City of Houston is bankrupt as measured by any prudent standard.

More importantly, falsehoods spewed by the Mayor and perpetuated by local media is a huge part of the fiscal problem. The public deserve to know the truth. Annise Parker’s angry lesbian politics dominated her time in office (against her promises to Westside conservatives) and fiscal responsibility was never part of her tenure. Sure, Parker has made decisions that appear and could be spun to appear as fiscally responsible but this has never been the truth. Parker is desperately trying to make sure that blame does not land on her for the City’s financial condition, which will be her legacy. Parker and Controller Green put out a bogus and completely untrue statement concerning our City’s financial condition, which was covered by several media outlets. This was yet another attempt to deflect blame for Parker’s devastatingly poor mismanagement of Houston.

Please know the facts when you got to vote. Listen to the candidates and watch out for the spin. Many are just seeking power with no hope or plan to right the sinking ship. If the media tells you that Annise Parker attempted to lobby the Legislature for local pension control, please know that she signed an agreement to do exactly the opposite in exchange for political support. If you are watching ABC13 KTRK as a local news source, please quit!

Houston Needs Better Tools to Fix Pension Problems

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This is a reprint of an editorial written by James Quintero that appeared in the Houston Chronicle

The first step is to return control to local taxpayers by removing barriers imposed by state law

By James Quintero

Houston city government has too much debt and too little restraint, according to a new report from Moody’s Investors Services that revised the Bayou City’s debt outlook to “negative” due to concerns over its finances.

Chief among the concerns expressed by Moody’s, one of the nation’s top three credit ratings, is heightened city government spending, robust debt payments, and “growing pension costs,” which have soared in recent years. It’s this last item—local public pension costs—that Houstonians should be especially worried about.

According to Moody’s report, Houston’s three local retirement systems—which includes the Houston Municipal Employees Pension System, the Houston Police Officers’ Pension System, and the Houston Firefighters’ Relief and Retirement Fund—had a total unfunded liability of $3.2 billion as of fiscal year 2014, “nearly double the liability reported five years ago.” The term unfunded liability refers to the difference between what’s been promised to future retirees and what is actually on hand to provide benefits.

What this means is that the city’s made billions and billions of pension promises that it doesn’t have the money to keep, at least not without a massive future tax increase or some other meaningful course correction. And these shaky promises only continue to pile up.

But it gets even worse, at least for those interested in making sure that these systems are sustainable over the long-haul.

Despite Houstonians paying into and providing for the city’s three pension plans, the taxpaying public has, in some cases, absolutely no say in how their pension plan is run, even though they foot the bill.

This lack of local pension control exists because, over the years, Houston’s locally-administered pension plans, along with several others throughout the state, have successfully lobbied the legislature to have some or all of their systems put into state statute. This shrewd move has effectively frozen into state law certain plan elements, like contribution rates, benefit levels, and the composition of boards of trustees.

It’s not hard to understand why these systems would angle for this kind of sweetheart setup, even if it’s wrongheaded.

By putting Austin in between Houstonians and their Houston-based pension plan, system administrators have erected a bureaucratic barrier to reform that helps lock-in a generous system while locking out everyone else. In other words, it’s a way to rig the game.

But by making it hard, if not impossible, for community stakeholders to have a voice in the governance of their local pension plan, these systems have courted fiscal disaster by crystalizing policies that are expensive in the near-term and unworkable over the long-run. Moody’s latest ding against the city of Houston is an indication of that much.

So how do we get ourselves out of this mess?

The first step is to put Texans back in the driver’s seat, empowering community stakeholders to have some oversight over the systems they support. This can be done with a simple one-page bill passed by the next Texas Legislature that removes from state law all those systems that have wriggled their way into the state’s protective arms.

Once local pension control has been restored, then Texans in each of the affected communities, including Houston, can have a candid conversation about the best way to fix the problem, whether it be adjusting benefit levels or raising contribution rates or moving to another type of system altogether. Whatever decision is made, it’s best made locally.

Moody’s latest report ought to serve as a wake-up call that there are serious pension problems lurking in some of Texas’ biggest cities, and right now the people paying for these programs don’t have the tools they need to fix them.

James Quintero is the director of the Center for Local Governance at the Texas Public Policy Foundation. He can be reached [email protected].

James Quintero

Texas Public Policy Foundation

Director, Center for Local Governance

512.472.2700 (o) 512.293.2752 (cell)

Engage: TexasPolicy.com/local    Facebook   Twitter: @TxLocalGov