Big Jolly Politics

politics in Harris County and Texas

Lt. Dan and Senator Huffman Sent Packing

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https://www.facebook.com/harriscountygop/videos/10159884636905112/

Lt. Dan and Senator Huffman speak in the beginning of the video and a series of votes on the resolution language begins at the 2:18.55 mark (or -21:29, depending on how your viewer works).

Dan Patrick and his political consultant Allen Blakemore were working the room when I arrived. I visited with a couple of folks trying to see if I missed anything.

Patrick definitely misread the room. I watched Lt. Dan speak with folks, making his point and moving on to the next person. Folks would nod in agreement and Patrick would move over to someone else. I knew Patrick and Huffman would not bother to stay until the resolution was heard, they didn’t. Of course, the Exec Committee would do what Dan said he did not need to stay. “I am Dan Patrick, and you know Hurricane Harvey was really bad and I am off to get an update from the Governor.” And then there was poor Senator Huffman who Lt. Dan left helplessly trying to explain all the good work of the elitist Republican establishment types. You know, the big government, pro-illegal immigration, C-Club contractor crowd – self-interest types. The folks who have completely messed everything up to date, those guys. Senator Huffman kept pointing over to her left at some of these folks. I am still convinced that Joan has noclue what her pension bill does or how it works. Her nails and hair looked good though.

The new number in cuts is now $2.54 billion in cuts from the unions, according to Senator Huffman. I am going to find the guy who can explain them to me. I am pretty sure I can’t go to Senator Huffman. Sly Turner says the number is $1.4 billion, he’s real liberal you know. Ole Sly used to tell folks it was $1.9 billion. I am pretty sure you would hear no number if their audiences contained both Republicans and Democrats.

The grassroots of the Republican Party had lost their way in the wilderness, but they found their way home last night. This was a big defeat for Dan Patrick who has lost his way too. I am tired of being upset with Dan and Joan. I just want them to find their way home or not. The grassroots of our local party is smart, and they figured out that they may not be able to afford to be friends with the police anymore. Dan and Joan don’t see this because the police pay them to hang out. It’s kind of like a neighbor who has joined a new country club and they only invite certain of their old neighbors to come hang out. Some friends are invited for their company while others are invited because they are expected to pay up and join. Of course, there are those that just can’t afford it.

Hurricane Harvey had suddenly re-prioritized the importance of good fiscal government. Government thinks they are the answer to everything, they are not. We are the can-do spirit that made Houston and Texas great. The politics of hurricanes is always interesting. The grassroots activists who are the Harris County Republican Party are fighters. A lot of folks in the room had been flooded out and had lost their homes and businesses. The last thing anyone wanted to hear about was pension bonds. Where are Kevin Shuvalov and Chris Beavers when you need them?

I would like to thank the Harris County Republican Party Executive Committee who voted against the pension obligation bonds. In case you don’t know there are 600 plus members. This was a big message and I appreciate it! Thank you! Special shout out to Rolando Garcia who spoke eloquently to defeat the proposal.  Again, congratulations to the men and women of the Harris County Republican Party.

I have never been more proud of you.

 

Paul Simpson’s Billion Dollar Pension Obligation Bonds

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Mayor Sly Turner, Lt. Dan, and Senator Joan Huffman celebrating their great billion dollar bond victory at the GRB. Picture was taken before Sly Turner sued over SB4

The first thing voters must know about the one billion dollar pension bond on the November ballot is where the money is going. The money is going to fund the DROP accounts of retired police officers and municipal employees for the City of Houston. This is largest bond in City of Houston history and none of it goes for Harvey relief!

The DROP stands for the Deferred Retirement Option Plan. The Texas Legislature created these accounts in 2001, which allow city police and municipal employees to retire after twenty years without really retiring. DROP allowed employees to accrue the retirement pay while being paid their normal salary in a separate account collecting eight percent interest. It was a pretend retirement. There were several bills that morphed into the system we have now. Mayor Sylvester Turner, as a state representative, carried every one of the bills. This irony should not be lost here. Not one dime of this money goes for any Harvey relief

Most police officers who have been in the system since 2001 have over one million dollars in their DROP accounts. Many officers have several million dollars in their DROP. Understand that this DROP account is in addition to their retirement benefits of 95 percent salary and medical benefits for the rest of their lives. This is why the City of Houston has an eight billion dollar unfunded pension liability and why we are compared to Chicago and Detroit. Voters are now being asked to make millionaires out of city employees.

The bond proceeds are divided between police and municipal employees: 750 million for police and 250 million for municipal employees. Obviously, there are a lot of police officers in the program. This billion dollar bond is just for this group of retiring officers and taxpayers can expect skyrocketing property taxes and more bond proposals in the future.

There is a group within the Republican Party, led by Paul Simpson, promoting this nonsense. Make no mistake, Paul Simpson is a big government establishment Republican, which is the reason the party was crushed in the last election cycle. Paul Simpson is not acting alone and his political consultant, Kevin Shuvalov, is being paid to promote Mayor Sylvester Turner’s billion dollar “kick the can down the road” bond deal. Shuvalov just happens to be a consultant to Joe Straus. You can bet that plenty of funds are fixin’ to flow into Paul Simpson’s coffers from both Sylvester Turner and the unions who are desperate for post-Harvey Republican support for this bond.

Lt. Dan and Senator Whitmire showing the love at the Capitol with the new HPOU President

Once again, Lt. Gov. Dan Patrick, a longtime recipient of [police] union support, is carrying the water for the pension bond election. Patrick’s political consultant, Allen Blakemore, worked with Turner in 2001 and was the lobbyist for the HPOU at that time. Blakemore facilitated Mayor Sylvester Turner’s billion dollar bond proposal through the Senate long before education and property tax reform went down in flames in the House. Lt. Dan and his consultant have been delivering for the unions since he was first elected to the Texas Senate and this year is no exception. While good people in our community are flooded out of their homes, Patrick, Turner, et al. are trying to make millionaires out of city workers.

Expect to see Lt. Dan (with a special appearance by Senator Joan Huffman and crew) representing recipients of union largesse at Monday night’s Harris County Republican Party’s Executive Committee Meeting. Maybe Sly can ask Lt. Dan about the rainy day fund when he is in town. Lt. Dan can ask the mayor about all the nasty things Turner and the Houston City Council said about the Republicans when Houston filed suit over SB4.

This is being done for the love of money.

Lt. Dan’s Pension Bill

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If you are a fiscal conservative, Monday May 1, 2017 will forever be known as Bloody Monday in the Texas Senate.

Never let it be said that Dan Patrick cannot move legislation. If you have a bill that makes multi-millionaires out of City of Houston employees and is promoted by the most fiscally liberal mayor in our lifetime, Lieutenant Governor Dan Patrick is your guy. All of the campaign contributions from HPOU finally paid off like a slot machine making the Service Employees International Union (SEIU) and the Houston Police Officers’ Union (HPOU) the kings of the Texas Senate. The faux conservative gig is up. Yesterday, Dan cashed in his conservative bona fides for Sylvester Turner and his big union buddies.

Lieutenant Dan was not alone in wrecking the finances of the City of Houston – he had accomplices. There is always Senator Joan Huffman who never fails to demonstrate her liberalism when it counts. Senator Huffman waived to all the Houston police officers in the gallery as she lined their deferred retirement option plan (DROP) accounts with her vote.

It is no secret that Sylvester Turner intends to lift the property tax cap in order to pay for all of this nonsense. When Turner lifts the tax cap, please send a love note to Lieutenant Dan for the pension Napalm bomb. We supposedly have a “conservative” legislature; however, Lieutenant Dan cannot make things happen on conservative issues like education and property tax reform. Lieutenant Dan should not captain a shrimp boat let alone preside over the Texas Senate.

Allen Blakemore, Lieutenant Dan’s political consultant, proudly displays on his website that he has also served as a consultant for HPOU. Finally, HPOU and SEIU’s political contributions to Dan, Joe Straus, and House Pension Committee Chair Dan Flynn have paid off like a million dollar slot machine.

The Greater Houston Partnership (GHP) and C Club joined in on Lieutenant Dan’s corruption of Houston finances. Both GHP and the C Club were somehow allowed to represent Houston taxpayers in the pension bill negotiation. This is like sending Bill Clinton to chaperone Miss USA contestants. I wonder if C Club member and Greater Houston Partnership Infrastructure Chairman Jim Dannenbaum participated in these negotiations. Or was he too busy dealing with the FBI?

Fiscally conservative Houstonians are without a voice in our Texas Legislature. As usual, Houston taxpayers are left holding the bag for the worst piece of legislation to come out of Austin in years. It is a sad day for Houston.

http://www.hpou.org/salary-calculator/ 

When a Corridor is a Cap

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    1. Senator Joan Huffman State Rep. Dan Flynn

State Representative Dan Flynn from Van, Texas ran the Houston pension bill hearing last Monday. Speaker Straus has appointed Flynn to serve as Chair of the House Pensions Committee for the past two legislative sessions. Although Flynn claims that he has “never voted for a bill to raise taxes” he does not seem to mind increasing the tax burden of Houstonians. All for his good buddy Sylvester “Sly” Turner.

Last Monday, I attended the House Pensions Committee meeting. Flynn ran the meeting like an autocracy, which is just the way Turner wanted the meeting to function. Although opponents to the Flynn/Turner bill were permitted to speak, they were not allowed to sit in the hearing room until their turn to speak. When I attempted to enter the hearing room, I was told that I would have to go to one of the overflow rooms. I quickly learned that the city lobbyists were controlling the seating and only those supporting the bill were allowed to sit in the hearing room during Mayor Turner’s presentation and those of the resource witnesses.

The large overflow crowd took up two committee rooms and a large auditorium located in the Capitol extension. The red Houston firefighter t-shirts contrasted with the HOPE t-shirts worn by the City of Houston Organization of Public Employees. Some city employees drove to Austin in city vehicles.

Flynn is carrying Houston’s pension bill, HB 43, in the House and put words into the mouths of speakers before his committee. Flynn made every speaker announce their name, state whether they are for or against the bill, and asked all the speakers to acknowledge that they were speaking on the committee substitute to HB 43. I am sure that Flynn’s directions were confusing to the numerous witnesses who were new to the legislative process.

HB 43, as substituted, is the companion bill to Senator Joan Huffman’s pension bill, SB 2190. The two bills, as substituted, are identical except for the provision in SB 2190 that requires a vote on the process. These two bills contemplate a billion dollar pension obligation bond.  Huffman’s bill 2190 requires a vote for the pension obligation bonds. It should be noted that the firefighters receive no proceeds from this bond. Turner and the police and municipal employee unions object to the voting requirement in Huffman’s bill. I believe this is because they know that Houstonians would not vote in favor of more debt. Please note that Turner does want to place a referendum on the November ballot that would allow him to lift the revenue cap.

Turner, the first witness, described how the world would end without the approval of HB 43. The truth is if HB 43 failed, several scenarios could play out. The city could:

  1. File for bankruptcy;
  2. Dramatically raise taxes;
  3. Continue to borrow money from unions running up the unfunded liability – or layoff union workers.

The bankruptcy option is never discussed because this process would remove the mayor as the decision maker on spending. Raising taxes would require lifting the revenue cap. Thanks to Bruce Hotze, lifting the revenue cap requires a vote by Houstonians. Mayor Tuner wants folks to vote on the revenue cap but not the pension bonds. If hypocrisy had a vote, the lifting of the revenue cap would fail. It is not an accident that Turner labeled his cap a corridor.

The revenue cap, approved in 2004, limits the increase in the city’s annual property tax collections to the combined rates of inflation and population growth, or 4.5 percent, or the lower of the two. Voters in 2006 adjusted the cap, allowing $90 million above the cap for public safety spending. Turner has not made his desire to spend above the cap a secret. Turner’s attempt to cap pension expenses and remove the property tax cap will be difficult for city voters to stomach.

The real story of Monday’s hearing was the testimony from the firefighters and their families. Many firefighters spoke, far more than any other employee group. The firefighters were respectful, polite, and prepared. The firefighters told compelling stories of the impact of HB 43. Firefighters argued that they negotiated with the city over wages and benefits and agreed to lower wages and higher benefits. Conversely, the police and municipal employees argued for higher wages. Now, the police and municipal employees want the firefighters to help them make up their pension liability shortfall.

Recently, the city has hired 700 new employees; but, hardly any police or fire employees. The city’s public works department has 4,000 employees compared to the more efficient county’s public works department that operates with 500 employees. The county’s public works department builds roads faster and better.

The city’s ability to borrow large sums from the unions by not paying them has allowed the bloated bureaucracy to breed inefficiency, redundancy, and a lack of accountability. Turner’s plan punishes the firefighters when they have been the responsible adult in the room for many years. Instead of bloated salaries, Houston fighters have been fiscally responsible by requiring a fully funded pension. Now, the pay scale between police and fire is significant.

Truth be told, the police cut a very fat hog and now they want their firefighter brothers to pay for it. Turner will do anything possible to pass HB 43 because it allows him to spend money at an irresponsible pace. The police and municipal employees want HB 43 to pass because it gives them a billion dollars to allow escaping union members to retire. Those left behind will have to deal with the increasing realization that their pensions may not be funded.

Some union members have figured out that the defined contribution plan (in contrast with the defined benefit plan) actually costs less and gives more than Turner’s plan. Social media is interestingly enough playing a role in disseminating information about the cost of the corridor. Huffman’s bill has been placed on the intent calendar for floor debate in the Senate this week. It could be called at anytime. Will Bettencourt filibuster the bill? It will also be important to watch what happens to SB 2190’s voting requirement. This is where Turner and the city’s lobby team will attempt to get rid of the voting requirement.

Pension March Madness

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The City of Houston gotsta get paid. For years, city leaders have operated with the philosophy of spending money that the city just doesn’t have. The Turner administration is no different.

Under Mayor Annise Parker, the media looked far and wide for a way to blame Republicans for the sins of liberal spending by a series of Houston mayors. Last legislative session, Mayor Parker took the position that Republicans refused to give her local control over the City of Houston pensions. Conversely, Parker promised the Houston Police Officers’ Union (HPOU) that she would not seek local control or use the city’s sizable lobbying forces to seek local control. Although Turner’s legislative strategy is a little more sophisticated and he is certainly more eloquent, he shares the same objective as Parker – keep on spending money and kick the can down the road.

Last session, State Representative Jim Murphy offered a bill for local control, which never made it out of committee. This was always the plan. Mayor Parker had to fool people for her last two years in office in order to keep spending money the city did not have in their accounts.

Mayor Turner’s dilemma is different because he was just elected to a four year term with a potential second term in his sights. After many years of working to assist city leaders in the legislature, Turner knew that his sneaky bastard plan had to be far more creative than Parker’s 2015 plan. Turner’s plan is simple: involve all three unions (police, fire, city employees), lobbyists, patsy legislators, and the Lieutenant Governor in the ultimate goal of spending money that the city doesn’t have in the coffers. I will count lining the pockets of lobbyists as a goal for discussion purposes.

Bill King has done yeoman’s work in holding Turner’s feet to the fire for a real solution to the pension problem. King ran on a platform of meaningful pension reform with the solution of moving all new employees to a defined contribution plan. Turner was endorsed by all three unions after he promised to oppose King’s defined contribution plan.

The three unions strongly oppose defined contributions because defined benefit plans are easily manipulated by politicians to benefit the unions. Defined contribution plans remove the politics from the equation. Thankfully and in the face of unfair criticism, King has remained engaged at the legislature in the defined contribution cause. March madness is in full effect and the Houston bracket of bad guy liberal spending is winning the tournament.

Turner knew that he had to employ a kick the can down the road strategy without being obvious. Turner’s first feat was to get Lieutenant Governor Dan Patrick and Senator Joan Huffman to agree with HPOU officials to take defined contribution off the table this legislative session. Ray Hunt, HPOU President, is a smart guy and is always covering bases. I like Ray even though I disagree with him all the time. He is a nice guy who does a very good job for his officers. They are lucky to have him.

Turner also lucked out when Patrick gave Huffman the position of chairwoman of the Senate State Affairs Committee where she is tasked with getting Turner’s bill through the senate.

Word started leaking out last summer that Turner’s scheme would employ a cap on city pension payments. So, the next time you hear Turner say he does not like caps – a la the property tax cap – remind the mayor that he is supporting his own version of a cap on city pension expenses, albeit a fake one. Beginning last summer, policy wonks immediately began speculating how Turner’s cap would work and whether it would it be enforceable. Turner was smart enough to call his cap a “corridor” – but, it is really a cap. Turner doublespeak.

State representative Dan Flynn chairs the House Pension Committee. Flynn’s bill, all 246 pages, has been circulated in the business community in order to garner the support of downtown types who are beholden to the mayor for handouts. Thankfully, King and members of the Arnold Foundation began analyzing the bill and sought edits that would tighten up the language. The devil is always in the details. King, Arnold Foundation representatives, and business leaders met with Senator Huffman in order to make crucial and necessary changes to Flynn’s bill. King and his crew spent hundreds of hours analyzing and tightening the corridor/cap language. The goal of these edits is to force the unions to adhere to Turner’s supposed principals. Anything else bankrupts the city.

Needless to say, after all the hours spent by King and others to tighten up the language, Huffman’s substitute filed on Monday is an exact copy of Flynn’s bill. None of the recommendations by King, the Arnold Foundation, and the local business community made it into Huffman’s bill. The good guys were played – Huffman was the secret agent. 

Huffman had probably been informing Turner and his lobby team of King and the gang’s recommendations all along. It should be noted that Huffman and her husband are longtime friends with Ray Hunt and Mark Clark, HPOU’s top lobbyist.

King has vowed to spend his time next year running against Huffman. King does live in her district and I believe that he is seriously considering the possibility. I will support him for his attempt to do the right thing on this issue alone. We will need to work with him on some other conservative issues but don’t forget that Trump came along too.

On Monday, I was present in the Senate chamber and testified on Senator Bettencourt’s SB 151 that was heard immediately prior to the Huffman pension bill. SB 151 requires a vote on the billion dollar pension bond by city voters. Huffman’s bill did contain this language but I suspect it will be stripped out in conference. Huffman has proven that she is not to be trusted.

Robert Miller, lead lobbyist for the city and law partner of Senator Whitmire, has covered his bases. Miller knows that Turner’s goal is a sleight of hand – appear as though he is doing something without actually doing anything. This was also true for Parker.

The goal is to keep spending money and lining the pockets of cronies. This fraud cannot happen if the bill actually worked because the unions would have to abide by paying their fair share. It was never the intention of Mayor Parker, Turner, Miller, or anyone in Austin to have this pension bill work as advertised. The goal was to grab the billion dollars and hand it over to the police and municipal employee unions so their retiring officers can make a fast break with their multimillion dollar pensions. Did you know that city taxpayers are making millionaires out of city workers? You know now.

Notice that I did not mention anything about the firefighters. The firefighters are actually the fiscally responsible adults in the room. Although their pension is far from perfect, it is financially much better off than the other two pensions. The billion dollar pension obligation bonds (POBs) proposed in Turner’s bill go to police and the municipal employees union. The firefighters get none of it.

The story gets worse for the firefighters because their pension is almost fully funded; but, they are being treated like the bad guys by city leaders. The city is asking for large concessions from the firefighters who are being punished for being good stewards of their funds. I say this because the firefighters always stood their ground and made the city fully fund their pension. The other two pensions did not and allowed a succession of Houston mayors to rack up a ten billion dollar unfunded liability.

Basically, the other two pensions have turned a blind eye to the out of control spending at the City and have taken lots of IOUs. Turner’s goal in all of this is to keep spending money that the city simply does not have. Turner’s pension plan is bogus and falls far short of his claims. Even worse, we really do not know the real fiscal health of the private equity investments held by the unions. The billion dollar pension bond could just be a starting point for the taxpayers. We need an audit by qualified, competent auditors who can be held responsible for erroneous financial information of both funds.

Either way, all of the actors in this year’s legislative tournament are behaving badly. Both Dan Patrick and Joe Straus have lined their pockets with union money. Do not think for a second that Joan Huffman acted without Pappy O’Patrick’s approval. Governor Abbott’s campaign has taken lots of money from unions; so, don’t expect him to do the right thing for Houston taxpayers.

Now is the time to fill out your bracket. My money is on the taxpayers losing bigly. The bottom line is that March madness has nothing on the drama at Texas Capitol. The next big game is Monday when Flynn’s bill is heard in the House.

Senator Joan Huffman-Let the People Vote

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Senator Joan Huffman photo Ralph Barrera-MBO

I wanted to say thank you to Senator Joan Huffman. It is rare elected officials look out for the taxpayers.

Senator Huffman, in an act of open defiance, inserted a provision into her pension reform bill that would require a vote on Mayor Turner’s billion dollar Pension Obligation Bonds (POBs). It must be a good amendment for taxpayers because Turner swiftly denounced the amendment as a poison pill. Turner’s demagoguery was quick and telling, omitting the fact that he carried the original enabling legislation, which created the mess. Did I mention all three Houston Public employee unions endorsed Turner?

Why is Mayor Turner so against a vote? Because he knows that this bond will be defeated at the polls. This one billion dollar bond does not buy one road improvement, hire one more police officer or firefighter, or build one park. All the money goes directly to city employees and their very lucrative Deferred Retirement Option Plan (DROP). This plan, originally supported by Turner when he was a state representative, has caused the unfunded liability totaling 8 to 10 billion dollars. Senator Huffman has the right idea because I fear we have another Dallas on our hands.

All investments need to be carefully scrutinized and the amount and size of every DROP account needs to be disclosed. The Enron-style accounting, lack of transparency, fraud, and misrepresentations associated with the pensions have been staggering.

Thank you Joan Huffman for looking out for the taxpayer!