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Council split on solutions for fire and police pension fund

Published On: Apr 09 2013 06:37:15 PM CDT
Updated On: Jan 15 2014 07:04:56 PM CST

ABC-7's Darren Hunt reports.

EL PASO, Texas -

Once again, City Council found itself Tuesday discussing at length the $270 million shortfall in the El Paso Firemen and Policemen's pension fund, two years after a $210 million fix had to be made.

In the end, City Council remained split on the possible solutions.

Council was divided on whether to push forward with proposed legislation that would allow them to increase the state mandated cap of 18 and a half percent contributions to the Police and Fire Pension Fund from the City.

But Mayor John Cook broke a 4-4 tie to approve moving forward with the legislation in Austin.

"The next step will be to meet with our state delegation to see if the bill will pass," said Lt. Tyler Grossman, chairman of the Police and Fire Pension Fund Board.

"There's still a chance it may not pass. We're hoping that it does, but we'll go through the process and see what happens."

If the proposed legislation passes, it would give Council another option to look at shortfalls in the Police and Fire Pension Fund as budgetary items on an annual basis.

Representatives Ann Morgan Lilly, Susie Byrd, Eddie Holguin and Cortney Niland voted against it. Council then voted unanimously to authorize the City Manager to continue to negotiate with the Police and Fire Pension Fund Board to seek a solution to the situation.

One way to fix it, according to Niland and a recent study commissioned by the City on the fund, is to lower the state mandated three percent cost of living increase, or COLA, that's built into the fund.

"They need to admit to the fact that they cannot afford a three percent cost of living increase each year and they need to admit to the fact that absolutely is draining their fund," Niland said. "We need to revisit our governance structure and we need to revisit an audit function and until we can have some of these things agreed upon, I don't see why the taxpayers of El Paso should have to continually inject capital to something that is out of control."

Meanwhile, leaders of the Fire and Police Associations said the money was promised to them, it's part of the contract and they expect it to be fulfilled.

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