The city of Dallas is expected to respond this week to a lawsuit filed by the Dallas Police and Fire Pension System over who has the final say on approving a plan designed to address a $3.4 billion pension shortfall.
Dallas City Councilmember Tennell Atkins, who chairs an ad hoc committee on pensions, said Monday that the city is still working on a solution to fully fund the pension in 30 years and submit the plan to the Texas Pension Review Board by November.
The plan, adopted in a vote Thursday, will also accomplish the same fully-funded pension by 2055 by ramping up contributions.
The two approaches differ in how quickly the city would be required to make “actuarially determined contribution” levels, or ADC, required by state law.
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The DPFP also asserted that it has the final authority to submit the plan to the pension review board, not the city of Dallas.
“The pension board feels like they have the last word. The city of Dallas feel like we have the last word,” Atkins said.
A state court will likely get the last word on which interpretation of a state statute is correct.
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The DPFP plan calls for the city to complete it in three years. Dallas proposes a slower ramp-up over five years. Starting in 2025, the city will contribute $20 million more annually, including a year-end stipend.
The DPFP Board of Trustees said in a statement on Thursday that it is still committed to working with the city of Dallas while the question of how fast the contribution ramp-up happens is settled in court.
“There is a legitimate and very important disagreement that exists with respect to the interpretation of our statutory mandate,” board chairman Nicholas Merrick said in a statement.
“We believe this clarification by the courts is critical to moving forward with a plan for the pension of the city’s valued first responders.”
Dallas interim City Manager Kimberly Bizor Tolbert responded in a memo to the council expressing surprise over the pension board's decision to sue the city.
“It is very disappointing to realize that while Mayor Pro Tem Tennell Atkins and city staff have been negotiating in good faith, it now appears the same cannot be said for the DPFPS representatives,” Tolbert said in the memo.
Tolbert added the ad-hoc committee will reconvene on Aug. 22 to provide updates and additional policy recommendations from city staff.
