Pension reductions approved by the Fort Worth City Council in 2012 for police officers and general employees will stand, after a federal judge on April 7 dismissed a lawsuit filed by two police officers.
The lawsuit, filed by Rick Van Houten, president of the Fort Worth Police Officers Association, and Steve Hall, a former president of the association, alleged that the changes to the pension plan violated the Texas Constitution. The Fort Worth City Council approved the pension changes in October 2012 and the lawsuit was filed that November.
“I am glad that a decision was made that provides a sustainable solution for the citizens of Fort Worth and our employees,” said Mayor Betsy Price. “We made some hard decisions regarding our pension but in the end we came up with a plan that is fair to our employees and the taxpayers.” Mayor Betsy Price
Federal Judge Terry Means of the Northern District of Texas said in his ruling that the changes to the pension plan did not violate the Texas Constitution.
Houten and Hall were represented by Klausner, Kaufman, Jensen & Levinson of Plantation, Florida and Ryan N. Hosack of Fort Worth. The city was represented by Kelly Hart & Hallman.
The union representing more than 500 Fort Worth firefighters also sued the city over changes to their members’ pension plan, but that case was filed separately and there has been no decision as of yet.
On Feb. 16, 2015, Fort Worth filed a notice in that case, Tate v. Fort Worth, which is pending in the same district before Judge John McBryde. That filing contends that the ordinances at issue in both cases provided for substantially identical amendments and that a decision on summary judgment in the case filed by the two police officers would affect the Tate case.
Fort Worth, like many cities and states, has been working to reduce its unfunded pension liabilities.
States and localities are straining to catch up with a moving target. Their required contributions more than tripled to $93.7 billion in 2013 from $27.7 billion in 2001, according to National Association of State Retirement Administrators data encompassing 80 percent of U.S. public pension assets. The plans were 79 percent financed on average as of 2012, down from about 100 percent in 2001.
In a 2014 report using primarily 2012 data, Morningstar Municipal Credit Research examined pension plans around the country, adding up the total unfunded pension burden for residents in the 25 most populous cities. According to the report, Fort Worth’s per capita unfunded city pension liability was $986. Fort Worth’s numbers were similar to those in Dallas, Houston and Austin.
“We are extremely disappointed with the decision handed down and our board of directors is currently weighing all options available to move forward,” said Van Houten. “The officers of the Fort Worth Police Department are some of the best in the country and their pension benefits are one of the key reasons we have been able to attract and retain the best and the brightest.”
– Scott Nishimura and The Washington Post contributed to this report.