The only thing that comes to mind is that Whitmire must be convinced that the only way to retain police officers and firefighters longer is by offering them an excellent pension in return for their service. The pension is also the same for municipal employees.
Click on the image for the article.
“Mayor John Whitmire has sparked concern among experts because of his support for bills that roll back reforms to Houston’s police and firefighters pensions, with some calling this move ill-considered and even “stupid”. The proposal is happening 8 years after the Legislature passed reforms for Houston’s employees pensions, which at this moment, are underfunded by $8.2 billion. Gov. Abbott’s desk is waiting for the House Bill 2688 to be signed, passed in both chambers almost unanimously, this bill leaves most reforms intact yet reverse key changes like letting police officers and firefighters retire after 20 years of service, regardless of their age. Past reforms closed this postponed retirement option plan, or DROP, to officers hired after 2004 and to firefighters hired after 2017, as reported by the Houston Chronicle.
“They lowered the retirement age, which is an inducement to retire, and then they add DROP, which is an inducement to stay on. That’s stupid. It’s cross-purposes,” said Craig Mason, a retired actuary who worked as a pension consultant, “This is just mind-boggling to me. They’re going backwards.”
Will Bill King take a knife to his buddy Whitmire’s plans?
Open Letter to City Employees & Retirees: Why You Should be Demanding Defined Contribuion Plans for New Employees
The City and your pension plans’ management are leading you down a path that will seriously impact your pensions for years to come.
Defined benefit pension plans are a broken financial model. They were originally put in place in a time that most people only lived a few years after retirement and financial markets were much more stable. Neither of those conditions exist today. As a result, the costs of defined benefit plans have inexorably risen over the last several decades causing the private sector to almost completely abandon them.
Every new employee added to this broken model makes your pension plan weaker and your pension less secure.
This is not an opinion. It is just math.
The latest data from the City (which is still unrealistically optimistic) shows that the City would have to contribute over $8 billion just to pay the benefits that you have earned so far.
The proposed plan represents an average 12% cut in the benefits you thought you were going to get. Of course, this comes after City leaders repeatedly promised you they would honor all pension commitments. And trust me, these cuts will not be the last you see. In fact, this is just the beginning.