Dallas, Texas has received many accolades in recent years for its economic growth, dynamic make-up, effective police force and more.

However, a new report from The New York Times indicates the city may be brought to its knees by an overextended pension fund for police and firefighters. According to the Times, the program’s overseers have asked Dallas for a bailout worth $1.1 billion – “an amount roughly equal to Dallas’s entire general fund budget but not even close to what the pension fund needs to be fully funded.”

The city’s mayor has called the request “ridiculous,” even as other solutions run into roadblocks:

Other ideas being considered include raising property taxes, borrowing money for the pension fund, delaying long-awaited public works or even taking back money from retirees. But property taxes in Dallas are already capped, the city’s borrowing capacity is limited, and retirees would surely litigate any clawback.

 This month, the city’s more than 10,000 current and retired safety workers started voting on voluntary pension trims, but then five people sued, halting the balloting for now.

Pension problems are not new to Dallas or to the public in general. They are blowing holes in budgets in several states, especially California and Illinois, and were a major factor in the collapse of the domestic auto companies that couldn’t adjust when the Great Recession hit in 2008.

“This is much like a Bernie Madoff scheme,” Mayer Mike Rawlings told the Texas Pension Review Board earlier this month. “The City of Dallas tax payer is the punching bag…”

Like the struggling states and the auto companies, the pensions issues began long ago.

To many in Dallas, the hole in the pension fund seems to have blown open overnight. But in fact, the fuse was lit back in 1993, when state lawmakers sweetened police and firefighter pensions beyond the wildest dreams of the typical Dallas resident. They added individual savings accounts, paying 8.5 percent interest per year, when workers reached the normal retirement age, then 50. The goal was to keep seasoned veterans on the force longer.

 Guaranteed 8.5 percent interest, on tap indefinitely for thousands of people, would of course cost a fortune. But state lawmakers made it look “cost neutral,” records show, by fixing Dallas’s annual pension contributions at 36 percent of the police and firefighters’ payroll. It would all work as long as the payroll grew by 5 percent every year — which it did not — and if the pension fund earned 9 percent annually on its investments.

 The pension fund began investing in real estate and elsewhere, and an audit earlier this year showed significant problems. Mismanagement is made worse by the fact that state legislators, not the city, manage the fund – and any reforms will take time, since Texas state lawmakers are in session only every other year.

Solutions for Dallas are bleak. Police retirees began a run on the pension fund over the summer, though a new regulation prevents more of that. A tax hike would devastate the local economy.

Without solutions, though, police who have relied on government promises will suffer. According to the president of the Dallas Police Association, “You had the perfect storm coming together and all of them screwing it up. “So, now who is on the hook? The taxpayer, the employer, the officers that receive the pay.”