Secret $2.5 Billion of Pension Savings

     From the moment Sylvester Turner announced his new pension scheme roughly two months ago, the principal sales pitch has been that it would produce $2.5 billion in immediate savings from benefits reductions to which the pension boards had agreed.  At that original press conference, reporters pressed Turner for specifics on exactly what the cuts were.  He refused to provide details.
     Finally, about 48 hours before Council voted on the outline of the plan, the City provided some details about the benefit reductions.  They are largely cuts around margin, reducing the cost-of-living adjustments (COLAs) and making some changes to the deferred retirement optional plans (DROP).  While the benefits reductions outlined in the term sheets are substantial, there was no documentation or back-up on how these cuts totaled $2.5 billion in immediate savings.
     Many of us attempting to vet this plan have been asking for that back-up since the plan was announced.  Administration officials have repeatedly promised it was about to be released, but so far, nothing has been forthcoming.
     Last week, City Controller Chris Brown and I appeared at a forum to discuss the new plan.  When I pressed Chris on why the back-up on the $2.5 billion in supposed savings had not been released, he said that the City had signed non-disclosure agreements with the pension boards that prevented them from releasing those numbers until a bill has been filed with the Legislature!!
     I have skimmed through recent City Council agendas and I cannot find where any such agreements have been approved by Council.  But even if they exist, what possible justification can there be for the City agreeing to keep these calculations hidden from the taxpayers?  After all, they are the ones who are going to foot the bill for this debacle.
     Obviously, someone in Turner’s administration did some calculations prior to his press conference in October to come up with the claim that these changes would save $2.5 billion.  Where are those calculations and why have they not been released to the public?
     Being somewhat of a skeptic (understatement), I suspect the reason the calculations have not been released is that they will not withstand independent scrutiny and that, if we ever see them, we will find out there are not $2.5 billion of savings from the cockamamie plan that has been put forward.
     But, I could be wrong.  In any case, the issue could easily be resolved.  Release the damn numbers now!