Both the city and the firefighter’s pension agree on one thing, that 2015 will likely be an expensive fiscal year when it comes to funding the pension. Mayor Annise Parker has called it a “gold-plated” pension and unsustainable in the long term. The city projects pension contributions could make up 45 percent of payroll in the fiscal 2015 budget. Christopher Gonzalez is the Executive Director of the Firefighter’s Pension. He says the outlook is already much better than that.
“Just in the last year and a half, based on market recovery, it’s come down from a high of 45-percent projected to what is today 32-percent projected. We believe that given another two years it could fall just as sharply and if not enough to where the matter of concern is not as great as it is today.”
Gonzalez says the city is panicking and still has plenty of time to let the numbers even out. He says there’s no reason to demand pension reform before the city knows exactly what its liability will be.
“We believe that the timing can be more methodical and the decision should be based where the pension fund is just before that new period of contributions begins and then if decisions need to be made, whether tough or not. I think the pension plan officials would be more than willing to sit at the table with the Mayor or the city administration at the time and negotiate through that.”
But that’s part of the problem, according to the Mayor. Under a state statute, any changes to the firefighter’s pension have to go through Austin. The city and firefighters have no “meet and confer” agreement, so they can’t simply sit down and talk. Gonzalez says in the past, the city and firefighters have been able to resolve issues reasonably.
“We don’t believe, based on that history, it’s necessary to change the law and create a meet and confer. I believe the pension plan officials, the board of trustees that is, are highly willing at the right time, given the right set of data, to sit down with the city officials and talk about resolutions to any problems that may be viewed at the time.”
As for the perception that firefighters can make more money in retirement than they do when they’re actually working, Gonzalez says that’s simply not true. He says a small number of fire department officials have what might be considered more than generous retirement benefits, but for the most part, they’re in line with other similar pensions.
“The vast majority of firefighters, out of 3500, well over 3000 fall into the normal and average category of pension benefits.”
The city says it can’t wait and needs to tackle the issue now, but Gonzalez says he’s confident the projected impact isn’t as bad as the city says it could be.