In late August, the Houston Business Journal ran a story that suggests Houston’s public pensions may be in worse shape than previously reported, due to rosy assumptions about rates of return on investment.
That’s news in its own right, but perhaps the bigger news (as yet unreported by other outlets) is found in the second paragraph:
The major variable at play is Houston’s assumed return on its current pension funds, said Craig Mason, pension executive to the city of Houston. Mason is still technically affiliated with the city, but his contract expires in September following an early release notice he received in August. His contract was originally set to expire in December. City of Houston officials were not immediately available for comment.
“Early release” is a polite way of describing the termination of a city employee/appointee. Houston’s strong mayor does generally enjoy that power.
Mason is a recognized expert on pension issues with an actuarial background. Former Mayor Bill White brought him on board early in his administration as the city’s designated pension point man. There are few people in the City of Houston who can claim greater knowledge of Houston’s pensions than Mason. So why in the world, now that many Houstonians are finally beginning to acknowledge what is an unsustainable situation with the municipal pensions, would the Parker Administration decide it no longer needs the services of one of the area’s most knowledgeable experts on the issue?
Could this be another instance of the thin skin of Mayor Parker and staff getting the best of them? Mason couldn’t have made the mayor very happy with his comments earlier this year on Parker’s poorly conceived firefighter deal:
Craig Mason, a pension expert who represents the city on the police, fire and municipal pension boards, noted that the agreement will result in about $57 million less being paid into the fund over the next three years without changing the cost of retirees’ benefits. Mason likens the deal to taking Advil for a brain tumor.
“For now it’s good: It relieves the pain,” Mason said, “but it doesn’t get rid of the cause of the pain, which is generous benefits.”
Now that we re-read that quote – which is really hard to dispute — it does seem that Mr. Mason was probably a little too honest about the mayor’s deal for his own good.