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City staff tell Austin audit committee pension reforms cut amortization and restored bond rating; OPEB liability remains $1.3 billion
Summary
Deputy CFO Diana Thomas and CFO Ed Bagnino updated the Audit & Finance Committee on legislative and administrative pension reforms, reporting amortization improvements (police amortization ~27.4 years), restored AAA bond rating by Fitch after reforms, increased city contributions from $185M (2022) to $283M (2026), and an actuarial OPEB liability of $1.3B.
City financial staff provided the Audit & Finance Committee with an annual update on the three city contributory defined-benefit retirement systems and related other post-employment benefits (OPEB) on Dec. 3.
Deputy Chief Financial Officer Diana Thomas described reforms implemented over recent years that changed contribution models to actuarially determined contributions, established lower benefit tiers for new hires, and altered board governance. She said those reforms reduced the systems’ amortization periods and moved them within the Texas Pension Review Board (PRB) guidelines.
Ed Bagnino said the reforms were material to credit standing: after reforms, Fitch Ratings restored the city’s…
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