Are the Editorial LiveJournalists auditioning for mayor's PR staff?
Do you sometimes get the idea that the Chronicle's Editorial LiveJournalists are envious of their former colleague, Frank Michel, the mayor's communications director?
It has seemed that way so far this week.
On Tuesday, the Editorial LiveJournalists praised City Hall's fancy new $36,000+ desk, calling it a "long term investment" that "showcases Houston's values." We doubt Mr. Michel could have phrased it much better than that!
Today, the Editorial LiveJournalists praised Mayor White's efforts to deal with the pension problem and adopted the mayor's tactic of demonizing HMEPS director David Long. The mayor's press people had to be smiling.
If the mayor eventually wins statewide office, maybe he'll bring some of the Editorial LiveJournalists (dubbed Mrs. White by some bloggers) on board as PR staff. They certainly seem to be auditioning for the part.
Incidentally, HMEPS director David Long has responded to the mayor's attack from yesterday with his own letter to the Chronicle. It's posted below in the [Read More] section. Long disputes the mayor's insinuation that the HMEPS board (which included five representatives appointed by the city) has committed "outright fraud." As we've said previously, that's a reckless statement the mayor (or the staffer who wrote the letter to the Chronicle) should not have made without evidence.
MAYOR Bill White, in his May 15 letter, said he does not plan to pay the city of Houston's full pension obligation to its municipal employees because he believes the statutory rate is unrealistic. But it is the law. State law requires the city to contribute an actuarial determined amount to the Houston Municipal Employees Pension System. If the mayor doesn't like the law, he could have worked through the process to get it changed.
In 2004, the HMEPS agreed, at Mayor White's request, to a three-year period of structured cash contributions ($66 million, $69 million and $72 million) in order to accommodate the city's budget requirements. It was clearly stated at that time that the cash contributions, based on the actuarial rate, would increase to $115 million on June 30, 2007, but because of HMEPS' outstanding investment returns, that number is down to $109.6 million.
HMEPS clearly understood that when the three-year funding schedule ended on June 30, 2007, the city would pay the amount required by state law. Based on the meet and confer negotiations we had, we believed the city understood that, as well.
In fact, in 2004, HMEPS sent to the city contribution rate projections for fiscal year 2008 and several years thereafter, and the actual rate and dollar amount are even less than projected. Also, the city received annual updates of the projected contribution amount for next fiscal year, and the actual rate is right in line with the projections.
The issue is not whether the mayor or his administration stated they would pay an amount required by state law, but why they have ignored our repeated requests for discussions about it, and why they are just now disputing an amount they have known about for almost three years.
Since the 2004 Meet and Confer Agreement, HMEPS has kept the city apprised of the increased funding requirement through written and oral communications, and has initiated attempts to meet for discussion.
At public pension meetings, City Council members have expressed concern about this issue and even asked, as far back as 2004, how it was being addressed. The city's pension official, Craig Mason, also acknowledged almost a year ago that this issue should be addressed.
The mayor is now speaking about a new pension plan, with even more options, as if that would be a good thing. However, giving more options is not meaningful to people if the options create a reduced benefit package. He also mentioned benefit proposals, but no specific proposals or associated cost breakdowns have been initiated by the mayor through the meet and confer process. Besides, these benefit issues were dealt with thoroughly when Mayor White's administration and HMEPS negotiated the 2004 Meet and Confer Agreement, which was approved by our board and the City Council. This agreement reduced the unfunded liability by about $1 billion, primarily through reducing future benefits by $850 million. We jointly reduced the unfunded liability.
The mayor's letter referred to "the Pension Board's 2001 mistake or outright fraud." In 2001, the Pension Board included five city representatives to ensure that the city's interests were dealt with. The city had a full voice on the board.
Regarding his referring to fraud, it is irresponsible for Mayor White to make such an allegation as this matter was fully investigated and reviewed more than three years ago with no finding of wrongdoing. Mayor White's staff has stated on numerous occasions that the funding shortfall is due to a mistake by the actuary.
I believe it is important to emphasize that HMEPS negotiated the Meet and Confer Agreement in good faith and has met its obligations under the agreement.
The city leadership should recognize the importance of this issue and make every attempt to work with us to meet the city's obligations under the law.
DAVID L. LONG executive director, Houston Municipal Employees Pension System
BLOGVERSATION: Lose an Eye, It's a Sport, Newswatch: City Hall.
Posted by Kevin Whited @ 05/16/07 10:28 PM | Print |
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