Bloomberg has a cautionary article about the once much celebrated Dallas Police and Fire Pension System and its precipitous decline in funding level. Over the past decade, the Pension System has gone from 90% funded to 45% funded. The Pension System could be out of cash in 15 years.
The article goes on to discuss not only the impact on City’s budget, but its credit rating and cost of borrowing.
At one time the Pension System was highlighted for the diversification of its investment portfolio. At one point “alternative investments” accounted for 52% of assets including an apartment tower in Dallas, the “American Idol” production company, rebuilding of Dallas freeway, luxury homes in Hawaii, Napa Valley vineyard and a patch of Arizona desert.
