Retirees blasted Dallas Police and Fire Pension trustees Thursday after the board blocked withdrawals from the troubled fund, just before the holidays.
Pete Bailey, a 27-year Dallas Police Department veteran, said the decision seems like theft.
"I think it's criminal what you're doing. And you're doing it to a group of people who have given their entire lives. Safety and security is not free," Bailey said.
The trustee vote came after a $500 million run on the fund this year, as worried members withdrew large sums of Deferred Retirement Option Plan (DROP) money.
Retired Deputy Dallas Police Chief Julian Bernal said he kept his DROP money in the fund with only small monthly withdrawals to supplement his pension. He said retirees like him are being penalized now for the big withdrawals others made.
"We're the people that have been doing it reasonably over a long period of time, since the day we retired. We didn't do any of this," Bernal said.
Managers said the remaining $2.1 billion in total pension fund assets include just $729 million in cash, and $154.5 million in pending withdrawal requests this week would take the cash balance too low for a pension fund. The fund has an estimated $6 billion in future liabilities under its current structure.
"There is no way not to do this. There is just no way not to do this," said trustee Philip Kingston, also a Dallas City Council member.
Pension Board Chairman Sam Friar, a Dallas Fire-Rescue lieutenant, said he has money in the fund, too.
"We're not holding your money forever. This is your money. We just need to come up with a policy for an equitable distribution plan," Friar said.
Thursday's vote included exceptions for minimum required distributions at year's end to comply with tax law. Other withdrawals could resume as soon as January with new limits if the fund's cash position improves.
Kingston voted against a pension board decision Thursday to liquidate assets to raise cash because he said other options are being considered.
"I thought it was better to keep them in the fund at their present value than sell them at a deep discount," Kingston said.
Risky real estate investments by past pension managers returned less than needed to pay generous interest rates promised on DROP accounts. The fund reduced DROP interest rates this year and member withdrawals began to surge.
Dallas Mayor Mike Rawlings used his own money Monday to sue the pension fund to stop the withdrawals, which he says pose a major threat to city finances. Thursday afternoon, a judge granted the mayor's request for a temporary restraining order, even though the pension board had already taken the action on its own Thursday morning.
Pension members said the mayor's actions have added fear that increased withdrawal requests.
"This is ridiculous," said police retiree Elvis Benson. "He is the reason that this happened and people took their money because of the things he said."
A pension fund plan to fix the problems includes a $1.1 billion cash infusion from the city along with benefit reductions and increased member contributions. Members are voting on that plan through Dec. 17.
Wednesday, city officials released a different plan for just $190 million in upfront bail out cash and much deeper benefit cuts for pension members and retirees. DROP interest would be eliminated and cost-of-living increases severely reduced in the city plan.
"This is a lot at stake here," said trustee Scott Griggs, also a City Council member. "We need to pay benefits. We need to keep our first responders on the street."
Pension trustees reviewed the new city plan Thursday but took no official action.
"There's going to be pain," said Kingston. "I'm not sure it's going to be what the city's proposed plan is now. There's other ways to do this. But it’s just a bad hand."
Even if pension and city officials agree on a plan, Texas lawmakers will have the final say, since state law created the Dallas Police and Fire Pension system.