Fort Worth City Manager David Cooke on Tuesday outlined a plan to fix the city’s $1.6 billion pension shortfall, including a controversial proposal that would eliminate a two percent annual cost of living increase for existing retirees.
In a presentation to the City Council, Cooke said taxpayers, employees and retirees should all fairly share the cost of saving the troubled fund, which provides retirement benefits for thousands of city employees.
Cooke’s plan also calls for taxpayers to increase their contribution to the fund by 3 percent and employees by 2.3 percent.
The latest news from around North Texas.
"You can't turn this ship on a dime," Cooke said. "We didn't get here overnight and we're not going to fix it overnight."
The plan to scrap the cost of living adjustment, or COLA, has proven most controversial.
Manny Ramirez, president of the Fort Worth Police Officers Association, said employees are being asked to pay too high a price.
"We're all a big family here in Fort Worth," Ramirez said. "I don't think asking that family to pay 70 percent of a 100 percent problem is fair."
Under Cooke’s plan, retirees who worked for the city for at least 25 years would still receive a yearly increase – but only on the first $20,300 they receive. And that’s only for those grandfathered into the older pension plan. Workers hired now get no yearly increase when they retire.
Employee groups have protested that the city itself should pay more to rescue the fund.
Cooke's recommendation came after three years of discussion.
The council is set to vote on the changes in September.
Employees must then approve the plan in September or the state could take over the fund and mandate adjustments.
The debate over how to save the pension fund from insolvency is playing out as the city is financially healthy overall and plans to reduce its property tax rate by two cents in 2019.