HFRRF News 
News for Immediate Release
Contact: Houston Firefighters’ Relief and Retirement Fund | 281.372.5100
Court of Appeals Affirms Houston’s Plan to Underfund Firefighters’ Pension Fund | Pension System will continue its challenge to have words of Texas Constitution recognized
HOUSTON (June 20, 2019) – The City of Houston has prevailed in an appellate court with its legal effort to underfund its yearly contributions to the Houston Firefighters’ Relief and Retirement Fund. Today, the Texas Court of Appeals, 14th Appellate District in Houston, affirmed a district court ruling that retained experimental revisions relating to funding made in the 2017 Texas Legislature to the firefighters’ pension statute.
“We are disappointed,” said Brett Besselman, the chairman of the HFRRF board of trustees. “This ruling, if upheld, would set the stage for perpetual shortchanging of firefighters’ retirement benefits. We will continue our legal challenges because Senate Bill 2190 violates the constitutional requirement that pension boards set actuarial assumptions to avoid local political tampering. We are compelled to pursue the rights provided in the Texas Constitution.”
The Texas legislature passed, and the Governor signed SB 2190 in the 85th legislative session. In addition to punitively cutting firefighter benefits and altering HFRRF’s funding mechanism, SB 2190 conflicts with the Texas Constitution by taking away the HFRRF board’s right to select the sound actuarial assumptions to be used by the Fund.
The Texas Constitution article XVI §67(f) grants the HFRRF board of trustees the exclusive authority to “select …an actuary and adopt sound actuarial assumptions to be used by the system.” SB 2190 infringes upon the HFRRF board’s constitutional right by setting out specific actuarial assumptions that HFRRF must follow. SB 2190 also sets up a procedure that allows the City to choose its own actuarial assumptions and force the board to “split the difference” on the City’s ultimate contribution rate even in situations where the board’s actuaries believe the City contribution must be higher. SB 2190 allows the City to game the pension to help the City balance a year to year budget, instead of producing long term security.
HFRRF was created by state statute and, since its founding in 1937, it has been administered by its board of trustees, as provided in the statute, who have adopted sound actuarial assumptions used by the Fund. HFRRF assets have grown steadily over the years. The market value of Fund assets in 1988 was approximately $468 million; today its assets are approximately $4.2 billion.
Chairman' s Message - March 8, 2019
Dear Fund
Members,
We are about half way through the 86th
session of the Texas Legislature. Today
is also the deadline for filing unrestricted bills and joint resolutions other
than local bills, emergency appropriations, and emergency matters submitted by
the governor.
In this session, lawmakers have, so
far, been focused on bipartisan issues like property taxes, school finance, and
the state’s retirement plans for teachers and the other state employees. We have been monitoring the filing activity
this session and we would like to update you on a few that may be of some
interest to our membership.
- Texas
Representative Tom Oliverson, District 130 (R-Cypress), filed HB 877 which
relates to exempting certain public retirement systems, like HFRRF, from
performing unnecessary actuarial valuations;
- Texas Senator
Joan Huffman, District 17 (R-Houston), has filed several bills, 2 that may be
of interest are SCR5 urging Congress to repeal the Government Pension Offset
and the Windfall Elimination Provision of the Social Security Act and SB 322
relating to the evaluation and reporting of investment practices and
performance of most Texas public retirement systems, and;
- Texas
Representative Dan Huberty, District 127 (R-Houston), filed HB 3599 that
addresses one of the unfair issues created by the passage of SB2190 last
session that impacted only a small group of retirees.
Again, we don’t expect any proposals filed
in this session to negatively affect our plan, but we will remain vigilant and continue
to monitor the progress of all bills filed and update you on legislation that
may be of special interest to you. The
last day of the 86th Texas Legislature session is May 27, 2019.
Sincerely,
Brett R. Besselman, Chair
Houston Firefighters’ Relief and
Retirement Fund Board of Trustees