Failing Dallas pension fund could bankrupt the city
The $2.8 billion Dallas Police and Fire Pension System could potentially go bankrupt, according to a meeting at the Texas state capital.
Dallas mayor Mike Rawlings suggested a big part of the problem was that pension fund members have been guaranteeing themselves an 8 percent return on their investments, and retiring with multi–million dollar DROP (deferred retirement option plan) accounts. DROP is a program that provides employees access to a lump sum benefit in addition to their monthly retirement benefit when they terminate employment and retire.
Reportedly, the pension fund recently has been besieged with retirements after a slate of proposed cuts to benefits was made public in August.
The pension fund has demanded the city to provide a $1 billion check in 2018, which would cost taxpayers a 130 percent property tax increase.
The pension fund previously committed $50 million to JPMCB Strategic Property Fund, managed by Morgan Asset M