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Plan allows the City of Dallas to responsibly incorporate the increased contributions for the fiscal year 2025 annual operating budget
DALLAS - On Thursday, May 23, 2024, after months of extensive work by the City of Dallas Ad Hoc Committee on Pensions and city staff, staff recommendations were presented that aim to fund the Dallas Police and Fire Pension System (DPFPS) over a 30-year period.
The city has remained fully committed to ensuring the funding soundness of DPFPS, and protection of the pension benefits for all City employees and retirees.
Because DPFPS exceeds the 30-year amortization period required by the Texas Pension Review Board (PRB), a joint funding soundness restoration plan is required to be submitted under Local Government Code Chapter 802.
Presented by Jack Ireland, Chief Financial Officer of the City of Dallas, the recommendations include an annual actuarial determined contribution with a five-year step-up. The plan ensures the following:
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An additional $17-$20 million in funding per fiscal year for the next five years that will continue to grow over time.
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An adjustment of one percent in the next fiscal year (FY25) that permanently adds to the base benefit for retirees.
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Beginning in 2026, retiree supplemental pay of one percent each year that DPFPS has a positive rate-of-return until the DPFPS is 70% funded.
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When the system reaches the 70 percent funding, cost-of-living adjustment will be tied to the consumer price index (CPI) at a maximum of 1.5 percent. DPFPS is currently funded at 39.1 percent.
The City of Dallas remains committed to public safety, including the continued implementation of the Meet and Confer Agreement negotiated by the City of Dallas, Dallas Black Firefighters Association, Dallas Hispanic Firefighters Association, Dallas Firefighters Association, Dallas Police Association of Greater Dallas, National Latino Law Enforcement Organization and Dallas Police Association. The agreement is on track to increase the salary of uniformed personnel by 7.23 percent in fiscal year 2025.
“While keeping compensation near the top of the market for our uniformed and civilian employees compared to other large cities, city staff has worked tirelessly to present a funding soundness restoration plan that does not leave our taxpayers on the hook for poor investment decisions made by the pension system more than a decade ago,” said Mayor Pro Tem Tennell Atkins, Chair of the Ad Hoc Committee on Pensions. “The Ad Hoc Committee on Pensions has never wavered from doing what is best for every resident of the City of Dallas.”
“The City of Dallas remains committed to working with DPFPS staff to achieve consensus on the final plan,” said Ireland.
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