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Dallas Police Force Shrinks in Face of Government Pension Bomb

Monday August 28th, 2017   •   Posted by Craig Eyermann at 6:13am PDT   •  

43922679 - police uniform The ongoing saga of Dallas’ failing government employee pension fund for its police officers and firefighters is continuing to play out to the detriment of the Texas city’s residents.

When MyGovCost last checked on the story, the city’s mayor had rejected new property taxes to finance a taxpayer bailout of the insolvent pension fund. At the same time, the city must still find a way to pay the monthly pension payments that they have guaranteed to the city’s retired police and fire fighters, where the high costs of doing so has damaged the city’s credit.

The city’s leaders have primarily chosen to address the situation by shrinking its police department. Jolie McCullough of the Texas Tribune describes what that has meant in Dallas:

Since 2011, Dallas’ police force has shrunk by more than 600 people, according to department reports. More than 40 percent of that drop has been since 2016, and officials continue to report large numbers of departures every month….

“It’s kind of like the perfect storm,” said Robert Taylor, a criminology professor at the University of Texas at Dallas. “You got failing pension plans, you have low pay, and then you have all sorts of political turmoil doing the job of enforcing in major cities.”

Dallas’ situation has been caused in part because unlike other cities in Texas, it has followed a strategy of paying its police officers less while providing them with much more generous defined benefit pensions as part of their total compensation package to be attractive to experienced officers. With the failure of the city’s police and fire pensions however, it has been increasingly unable to retain its experienced officers, who can get better pay and benefits from neighboring cities. Consequently, Dallas’ residents are now getting far less police for what they pay in taxes, with the results showing up in slower response times to emergency calls and delayed resolutions to criminal investigations.

Dallas’ situation in this case makes a strong argument in favor of governments adopting defined contribution pension plans for their employees (like the kinds of IRAs and 401(k)-type plans that are common in the private sector), over the kinds of traditional defined benefit pension plans that are proving to be overly burdensome to hundreds of local governments and dozens of state governments across the United States, which Bloomberg describes as “America’s Pension Bomb“.

By adopting this kind of reform, local and state governments could better protect the interests of their citizens and residents, who would no longer have to bear the cost of higher taxes to bail out a failed government employee pension fund or be made to suffer from a reduction in desired government services like those provided by police and fire departments. Meanwhile, government employees would benefit from being freed from the consequences of their government employers being unable to make adequate provisions to fund their promised retirement benefits.

Best of all, they would have more in common with their fellow Americans who work in the private sector.

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August 2017