Judge Denies Dallas Mayor Mike Rawlings' TRO to Stop Police, Fire Pension Withdrawals - NBC 5 Dallas-Fort Worth

Judge Denies Dallas Mayor Mike Rawlings' TRO to Stop Police, Fire Pension Withdrawals

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    NEWSLETTERS

    Dallas Mayor Mike Rawlings is suing to keep the city's Police and Fire Pension Fund from putting Dallas in danger of bankruptcy. (Published Monday, Dec. 5, 2016)

    A judge has denied a temporary restraining order filed on behalf of Dallas Mayor Mike Rawlings Monday seeking to stop the Dallas Police and Fire Pension system from allowing retirees to pull their deferred retirement funds from the ailing system.

    The judge denied the request, pending a pension board meeting Thursday where the board may take the same action. If the board does not take action, the judge reserved time Thursday afternoon and Friday to reconsider Rawlings' request.

    Rawlings' attorney wrote in the lawsuit, which the mayor did not file in his official capacity, that he believes the pension board is "willingly failing" to perform its duty. It asks a judge to issue an injunction to stop the withdrawals, which the mayor asked the board to do in a letter last week.

    The copies of the paperwork filed and shared with NBC 5 are at the bottom of this article: Writ of MandamusTRO Vol. 1TRO Vol. 2TRO Vol. 3Emergency Motion for Expedited DeliveryCounsel's Letter to Judge and Counsel's Letter to Opposing Counsel.

    "Because (deferred retirement) Participants do not have any right to a lump-sum withdrawal of (deferred retirement) funds, this method of payment may only be used when the Pension System is solvent, liquid, and actuarially sound," the lawsuit contends. It also states that the pension system's staff is close to liquidating assets to pay for the withdrawals.

    More than $500 million in deferred retirement funds have been withdrawn since August, worsening the fund's finances. A study commissioned by the pension board projected that the fund will be insolvent in less than 15 years if no changes are made to the benefits received by members or to the amount of money the city contributes.

    Rawlings Files Suit to Stop Police, Fire Pension WithdrawalsRawlings Files Suit to Stop Police, Fire Pension Withdrawals

    Dallas Mayor Mike Rawlings has filed a lawsuit to stop the Dallas Police and Fire Pension system from allowing retirees to pull their deferred retirement funds from the ailing system.
    (Published Monday, Dec. 5, 2016)

    Rawlings issued a statement through a spokeswoman Monday.

    "As a 40 year resident and taxpayer of the City of Dallas, I have chosen to personally file suit in District Court not only to protect the retirement benefits of all our police and fire personnel, but also to protect the pocketbooks of all my fellow citizens and taxpayers. I am funding this suit and at no time will any taxpayer dollars be expended in this effort," he wrote.

    The pension board's attorney didn't immediately respond to a call Monday seeking comment. The board's president, Sam Friar, said in a letter to beneficiaries last week that the board doesn't believe it can restrict access to the deferred retirement funds under the state constitution.

    The city and the pension board have been at odds over how to fix the financial issues with the fund. City officials have noted that dozens of the retirees withdrawing their funds are retiring with as much as a million dollars because of hefty benefit changes to the deferred retirement program voted in by members over the past two decades.

    Pension officials have said the city has failed to make a financial commitment to keeping the fund solvent. They have presented options to the city for increasing its financial contribution by as much as $1.1 billion.

    Bankruptcy Could Have Wide-Ranging Effects on DallasBankruptcy Could Have Wide-Ranging Effects on Dallas

    Bankruptcy, though not imminent, is a possibility for the city of Dallas if something doesn't change with its Police and Fire Pension Fund.
    (Published Monday, Dec. 5, 2016)

    "The money is just not there," explained Mike Davis, professor of economics at the Southern Methodist University Cox School of Business.

    Davis has been studying the troubles with the pension fund.

    "This is squarely on the back of the city government, the firefighter and police unions, the pension authorities in Austin," Davis said. "This is just an example of misgovernment. There's no way to sugarcoat that."

    Dallas Police Association President Frederick Frazier issued a statement Monday afternoon saying the union is disappointed in the mayor's lawsuit.

    "It is becoming painfully clear that the Mayor's reckless endgame is to bankrupt the retirement plans of first responders in hopes the state will seize control of the pension system so Dallas City Hall can rid itself of this crisis," Frazier wrote.

    A state district court judge cleared the way last week for beneficiaries of the plan to resume voting on proposed benefit changes as part of a fix. In order for those to pass, 65 percent of the membership must approve them. The lawsuit, which will go to trial in March, seeks to invalidate the pension board's actions alleging that it has more members than is allowed under state law.

    NBC 5's Ken Kalthoff and Noelle Walker contributed to this report.