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Houston Firefighters' Relief and Retirement Fund
Letter to members
Monday, February 27, 2017

Letter to Houston Firefighters’ Relief and Retirement Fund Members from David L. Keller, Jr., Chairman, HFRRF Board of Trustees

Dear Members:

In recent days, Mayor Sylvester Turner effectively has instructed city staff to end discussions with the Houston Firefighters Relief and Retirement Fund.  After more than 30 formal meetings with the city, scores of emails and phone calls, countless legal and actuarial analyses, and dedicated nights, weekends and holidays working toward a solution, our Mayor, the former state legislator, has decided to use the insider's game of the legislative process to pursue his own one-sided plan. 

In light of the mayor's disappointing decision and misleading public comments, I wanted to update you on where things stand and our own plan for protecting our pension system.  

First you should know that we tried in earnest to achieve a reasonable deal for you, our members, with the city. We went into discussions fearing the Mayor would use our well-funded, well-managed system to pay for the other funds' shortfalls and his other priorities. Our fears now seem well-founded. 

As the process wore on we sensed that the other pension systems were getting information, deal language, and negotiations ahead of us. We were not included in the first rounds of discussions. The city returned our drafts slowly or incorrectly using ambiguous language, often with new features and provisions favorable to the city and needing new discussions. On several occasions, when we thought an agreement had been reached, the Mayor's staff would introduce new items outside the original framework or other "non-negotiable" items. Every maneuver presented more evidence the city was not truly interested in reaching a reasonable deal with us. Looking back, we now believe the city purposefully dragged its feet to use the March 10 deadline for filing bills against us. 

We mention all this background because the Mayor's recent statements blame us for the current impasse. We view this as a clever attempt to justify to his former legislative colleagues why they should accept his plan despite our serious reservations and objections on points the city insists upon and will not discuss. The Mayor declared, in this week's council meeting, that the plan he submitted for our fund is similar to one for the Houston Police Officer's Pension System (HPOPS) -- we do not know what his plan is exactly because he has not shared it with us.  Effectively introducing a parity in pensions while there has been no parity in pay for nearly two decades is fundamentally unfair.  If the Mayor's plan for us is the version we last saw or worse, we will absolutely oppose it. It was punitive and failed to reflect the HFFRF's strong financial position relative to the other systems.

Since our inception 80 years ago, HFRRF has made sound financial decisions and earned solid returns to ensure your benefits are here now and throughout retirement.  The money which the city owes the firefighters' pension is less than one-fifth its overall obligation to all Houston pension systems. The Mayor and city staff have ignored the inconvenient fact that firefighters have opted for more in deferred compensation of retirement benefits than current salary.

In coming weeks we will be addressing this situation and will advise you when events in Austin warrant further update. We have many options as to how we will inform legislators about our concerns and the unfolding situation. We refuse to sit idly by while attempts are made to bulldoze us. We will protect our pension system - the best funded among all Texas pension systems with more than $1 billion in assets - so that you do not suffer for the city's track record of fiscal mismanagement. We did not dig their holes. We should not be forced to fill them with our retirement funds. While we never expected nor advocated for the status quo and still do not, we are 100% committed to protecting the retirement security of our members. Unfortunately, the city's priorities do not align with ours. While we have been and remain willing to work with the Mayor to reach amicable language to present to the legislature jointly that would result in adjustments to the Houston Firefighters' Relief and Retirement Fund's statute, it does not appear that the Mayor shares this willingness. 

Sincerely,

David L. Keller, Jr.

Chairman, HFRRF Board of Trustees




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