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Houston City Council OKs Mayor’s Pension Plan

HOUSTON (CN) — An impassioned plea from Houston's mayor Wednesday for the City Council to approve his plan to reduce the city's $7.7 billion pension debt persuaded a holdout councilman to rubber-stamp the deal.

Houston Mayor Sylvester Turner, a black Democrat and Houston native who served 27 years in the Texas Legislature, made solving Houston's pension problems his top priority upon taking office in January. He later warned city workers that hundreds of them would be laid off if reforms weren't made.

Turner unveiled a pension reform plan last month that he says will pay off the debt in 30 years.

All but one of Houston's 16 city council members voted in favor of a resolution Wednesday to accept the plan and send it to the Texas Legislature, which must draft and pass legislation to ratify the plan because state law governs how much the city pays into its municipal worker, police and firefighter pension funds.

Council member Michael Kubosh said Tuesday he planned to delay a vote on the resolution at Wednesday's council meeting, a procedural move called a "tag," Houston's NPR affiliate reported.

Kubosh took that position on the advice of State Sen. Paul Bettencourt, the former tax assessor-collector for Harris County, which encompasses Houston.

Bettencourt said at a press conference at City Hall on Tuesday he needed more time to study the mayor's plan because he's unsure how the city and its employees would negotiate changes if the city's annual costs exceeded the limits they agreed on.

Bill King, a Republican, attorney and businessman who lost the November 2015 mayoral election to Turner and is critical of the mayor's plan, stood beside Bettencourt at the press conference.

Turner opened Wednesday's council meeting by blasting Bettencourt and King for not voicing their concerns at the council's Tuesday meetings, where citizens can speak to the council on a microphone about anything they want to since he announced his reform plan more than a month ago.

"I stand with the people of the city of Houston. I was voted to represent their interests, not some party affiliation or some political interest or somebody who wants to be mayor. OK? I represent the people of the city of Houston and the pension issue has been holding the city back for a long time. Employees deserve certainty, they deserve certainty," Turner said.

The mayor continued, "If you are asking police officers to give up more of their benefits say it. If you want firefighters to give up more say it. But don't dare say you stand with police and fire and people who are picking up your trash and you want to take more benefits from them when they have put $2.5 billion on the table without raising any of your taxes."

Turner's speech won over Kubosh.

"Mayor, would I have gotten this presentation from you if I hadn't said I was going to tag it? That was absolutely fantastic. So I'll remove my tag, mayor," Kubosh said.

Mike Knox was the only council member to vote against the resolution. Knox called the vote "political theater" because Turner didn't have to get the council's approval before sending the plan to the Texas Legislature.

"Because this plan relies on the Texas Legislature to pass the legislation, which has not yet been drafted, and without reviewing the actual proposed legislation, I cannot offer my support for something that doesn't yet exist," Knox told the council.

Turner's plan calls for current municipal workers, firefighters and police officers to give up $2.5 billion in retirement benefits and for the city to issue $1 billion in pension obligation bonds. The plan includes a mechanism to take the city's three pension funds back to the negotiating table if the city's pension bills get too expensive.

According to Turner, the proposal will not raise Houstonians' taxes or decrease pension payments for retirees, but active employees could see a reduction in cost-of-living raises or a slowdown of the rate their retirement benefits accrue.

Turner announced the deal in September with the support of the city's municipal employee and police pension funds. The firefighters' fund initially withheld its support, but its board voted on Monday to endorse the plan.

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