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Even by changing the eligibility rules for the first time in a decade and adding extra money, budget staffers estimate that the fund won’t be fully robust and healthy until 2030.
The city will not alter the pension benefits or eligibility rules for current workers or retirees, and the fund is not in immediate danger of failing to cover its costs, Deputy Chief Financial Officer Jeff Knodel said.
The city also doesn’t plan to change the formulas for police or firefighters, who have separate pension funds that are in better financial shape, he said.
Any changes to future workers’ benefits must be approved by the state Legislature. Budget staffers hope to bring changes to the board and the City Council for a vote by early fall and to the Legislature next year, so they can take effect in 2012.
Austin’s main pension fund covers about 4,000 retirees and 8,000 workers who are not police or firefighters. The fund showed signs of trouble when the economy faltered after Sept. 11, 2001, and it took another hit when the stock market tanked in 2008.
It began to rebound last year but still has only 72 cents of every dollar needed to pay benefits to current and future workers.
That ratio is a barometer of the fund’s health, and pension experts say it should be at least 80 cents per dollar. Except for 2007 and 2009, when the ratio for Austin’s fund increased slightly, it has dropped or stayed the same every year since 2000, the last time the fund had enough money to cover all of its obligations over the long term.
In the late 1990s, Austin’s pension fund was in great shape with robust returns, and the city wanted to increase benefits to attract good work-