This morning Dallas Mayor Mike Rawlings called for a criminal investigation of the past administrators of the Dallas Police & Fire Pension System. He announced the move on Facebook. "I recently spoke with Texas Department of Public Safety Director Steven C. McCraw to request that the [Texas] Rangers conduct a criminal investigation of the past DPFP administration," he wrote. "In addition, I have been in close cooperation with the FBI on this matter. Anyone brazen enough to commit crimes that harmed those who sacrifice so much to keep our city safe must be brought to justice."
At the heart of the problem is the Deferred Retirement Option Plan, or DROP. Dallas' uniformed personnel could work the full 20 years required for them to earn their pensions, but keep working while their pension checks were put into special DROP accounts. These accounts are guaranteed to grow at a rate of 8 to 10 percent — more than the pension fund itself expected to get on its investments. This is not sustainable.
Current estimates put the pension's unfunded liability at somewhere between $3 billion and $4 billion, enough of a chunk that Rawlings said it threatens the city's fiscal health. "It is horribly ironic that a city that has enjoyed such tremendous success, a city that has made Texas so strong and so proud is potentially walking into the fan blades that look like bankruptcy," Rawlings said in February, as the scope of the losses became clear. "Shame on me, shame on you, shame on all of us if we allow that to happen."
Rawlings says the information he has learned about the way the fund was administered led to his call to the Rangers and the FBI. "As I have learned more in recent years and months about how the DPFP reached its current crisis, I have come to believe the conduct in question may rise to the level of criminal offenses," he wrote.
Rawlings ended the post saying he is not available for interviews "and will not have any further comment on this matter."
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