Associated Press
AUSTIN, Texas — The Texas Senate has approved a bill potentially cutting billions in future costs from Houston’s cash-strapped police and firefighter pension plans.
Republican Sen. Joan Huffman’s proposal was approved Monday 23-5. She said it wasn’t perfect but still “critical” to America’s fourth largest city’s future.
Plagued by investments that didn’t meet high return expectations set previously, Houston is facing about $8 billion in unfunded pension liabilities. Mayor Sylvester Turner has warned of up to 2,200 layoffs.
Huffman’s plan is similar to one backed by Turner. It provides $1 billion in payments from bond proceeds to be divided among the police and firefighter pensions, while lowering the plans’ future investment yield targets.
The bill didn’t include a conservative-backed effort to change both funds from guaranteed pension payments to 401(k)-style “defined contribution” plans.