2016 File Photo
Now in minority on pension board, police and firefighters will turn to trustees who know them well
Filed under Dallas City Hall at Sep 2017
Tristan Hallman, Dallas Hub Editor
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Dallas police and firefighters, now reduced to minority representation on their pension's board, will turn mostly to new trustees who know them well.
The nominations committee — made up of representatives from 11 police and firefighter associations — selected a Dallas firefighter's wife with significant investment experience, a former Dallas police officer and a Houston businessman for the three non-member spots. For the two member or retiree positions, police have five candidates, and firefighters will offer up only the board's recent former chairman.
Police and firefighters will have a chance to vote for the nominees the week of Oct. 2. The trustees, once certified as approved Oct. 10, will fill out the new-look pension board that includes six business and legal professionals appointed by Mayor Mike Rawlings.
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The new board will have to decide on important investment issues and whether to keep the staff that guided the fund through its crisis.
The board overhaul was a key part of the Legislature's pension fix that took effect Sept. 1. Previous boards — made up of police, firefighters and elected City Council members — had allowed the system to plunge heavily into risky real estate and pay unsustainable benefits.
The law now bars active members or pensioners from serving as the non-member trustees in an attempt to professionalize the board and eliminate the potential for self-interest. That makes the inclusion of Blaine Dickens, a former Dallas police officer of six years, and Tina Hernandez, whose husband was one of the public faces of the pension fight, seem odd on its face.
But Dickens no longer has money in the pension, and the law doesn't say anything about a potential survivor, said executive director Kelly Gottschalk, a non-voting member of the nominations committee.
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Gottschalk said the governance structure is fairly unusual anyway. Family members "certainly have a vested interest in the long-term" future of the pension, she said.
Hernandez said husband Jeff Patterson's severe burns in a 2014 fire prompted her interest in benefits for first responders. She said in her personal statement that she wants to "pay it forward and fight for" those who rallied around her family in their time of need.
But Hernandez also has broad investment experience, albeit with much of it in higher-risk, higher-reward ones than a pension would heavily invest in. Much of her experience comes from hedge funds, credit default swaps and private equity in sub-Saharan Africa.
She said her understanding of risk and broad experience with different kinds of assets will help — and that she will be able to recognize what shouldn't be included in the pension's investments.
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Dallas Fire Fighters Association President Jim McDade, a member of the committee, said Hernandez's experience made her stand out from the pack of 16 candidates the committee interviewed.
"She did a fabulous job in her interview," McDade said. "We know that she's going to be supportive of both the actives and the retirees."
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Dickens, meanwhile, said he said he's no financial expert, but that his background with lending institutions, the Internal Revenue Service and police departments will help him.
He said he became more interested in the pension in the spring, and advised friends to wait until the next session in January 2019 or a special session of the Legislature to get a better deal that also resolved the multi-billion dollar back pay lawsuit — a potentially risky move for a fund on the brink of insolvency within the decade.
Dallas firefighter Jeff Patterson, wife Tina Hernandez, and mother Carolyn Beall during a welcome home celebration at his house in Dallas on Sept. 19, 2014. Patterson was critically injured battling a house fire.
(Vernon Bryant/Staff Photographer)
Gilbert Garcia, managing partner of Garcia Hamilton & Associates LP, in the Houston investment firm's trading room.
(Gary Montgomery)
Chairman Sam Friar (right) and Vice Chairman Ken Haben listen to the discussion about the possible changes to DROP policy during the Board of Trustees meeting at Dallas Police and Fire Pension System in Dallas, Thursday, Dec. 8, 2016.
(Jae S. Lee/Staff Photographer)
City Council member Scott Griggs (left) talks with Deputy Vice Chairman Joe Schutz during the Board of Trustees meeting at Dallas Police and Fire Pension System in Dallas, Thursday, Dec. 8, 2016.
Deputy Chief Scott Walton (left) talks with Interim Chief of Police David Pughes during the "Night of Honor" awards ceremony at American Airlines Center in Dallas on Thursday, July 6, 2017.
Gilbert Garcia, an investment manager based in Houston, has no ties to the pension system. He has served on several boards, including Houston's municipal pension fund, which had its own troubles in recent years, from 2004 to 2010.
He said in an interview that he has a conservative investment philosophy and hopes to find some creative ways to help fund the pension system.
But, he added, he doesn't know what to do yet and won't be "going in with an agenda."
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The police member position will be competitive. Two of the candidates, Senior Cpl. Joe Schutz and retired Sgt. Ken Haben were trustees on the previous board. Retiree Stephen C. Paz, Deputy Chief Scott Walton and Officer Thomas White are also vying for the seat.
Walton, who oversees personnel and has seen the mass exodus of officers because of the pension, said he wants to help. Previously, he said that he, "like a lot of people, thought everything was going extremely well and you had people handling it" until recent years.
The return of Sam Friar, the recently retired former board chairman, will mean at least one board link to the legislative battle over the pension. Friar said the choice wasn't easy after a difficult year.
"I thought real hard about it," Friar said. "And I said, 'You know what, I could probably be some help to the new board.'"
And from the fire side, he said, "Nobody else was crazy enough to do it."