The city must follow through on its $1 billion promise in obligation bonds in order to continue the positive change
These days, many people are sick of politics. They think partisan posturing and political gridlock make it impossible to get anything done. But local and state leaders recently proved those naysayers wrong. Our elected officials showed the people of Houston, and indeed the nation, that they can - and will - come together when the future of our city is at stake.
Rising pension costs could all but bankrupt Houston. The $8.2 billion pension debt is four times more than the city's total general fund revenue - and last year, Houston closed its books with an operating deficit for the first time in history. The city's estimates indicated that in order to deliver on benefit promises, its pension contributions would total nearly 60 percent of payroll for the police department and close to a whopping 70 percent for the fire department. Facing the prospect of massive tax hikes, sweeping layoffs and deep benefit cuts, the need for reform took on a new sense of urgency.
The entire Houston community - including area business executives, labor leaders, finance experts, members of the Houston legislative delegation and city officials - knew there was no easy fix. They would need to work together to make extensive changes in order to solve the problem.
Mayor Sylvester Turner made pensions a top priority during his first year in office. From the outset, he engaged police officers, firefighters and municipal employees in efforts to develop a solution. To their great credit, members of the police and municipal employees pension plans acknowledged that the current systems are unsustainable. They agreed to significant benefit modifications that will reduce pension costs and help keep the systems from going broke.
Read the entire piece here at the Houston Chronicle
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Josh B. McGee is a senior fellow at the Manhattan Institute and vice president of results-driven government at the Laura and John Arnold Foundation. In 2015, McGee was appointed to chair the Texas Pension Review Board by Governor Greg Abbott.
This piece originally appeared in Houston Chronicle