Updated October 30, 2026. Quick answer: The Houston Police Officers’ Pension System (HPOPS) sets its COLA by formula: the most recent five fiscal years’ smoothed investment return, as determined by the pension system actuary, minus 500 basis points (5%), never below 0% or above 4%. It takes effect April 1 and is paid with the April 30 benefit payment. The sources read do not print the percentage applied in 2026, and no 2027 percentage is published.
The statute
Article 6243g-4 says: “beginning with the fiscal year ending June 30, 2021, the pension payable to a retired member or survivor who is 55 years of age or older as of April 1 of the applicable fiscal year, a member or survivor who received benefits or survivor benefits before June 8, 1995, or a survivor of an active member who dies from a cause connected with the performance of the member’s duties shall be adjusted annually, effective April 1 of each year, upward at a rate equal to the most recent five fiscal years’ smoothed return, as determined by the pension system actuary, minus 500 basis points.” The limits: “The percentage rate prescribed by Subsections (c) and (c-1) of this section may not be less than zero percent or more than four percent, irrespective of the return rate of the pension system’s investment portfolio.”
How HPOPS describes it
The 2025 Summary Plan Description says: “The COLA is calculated using a rate equal to the most recent five fiscal years’ smoothed investment return, as determined by the pension system actuary, minus 500 basis points (5%). The COLA can never be less than 0% or more than 4%.” Timing: “COLA increases are effective April 1 and are paid with the April 30 benefit payment.” Who receives it: “Retired members and eligible survivors age 55 and older as of April 1 of the applicable year, a member or survivor who received benefits or survivor benefits before June 8, 1995, or a survivor of an active member who died in the line of duty will receive a COLA.”
What the financial statements say
The fiscal 2026 financial statements repeat the limits: “Pension benefits for eligible members and survivors are adjusted each year at a rate equal to the most recent five fiscal years’ smoothed return minus 500 basis points, subject to minimum and maximum increases of 0.0% and 4.0%, respectively.”
What the documents do not say
The percentage actually applied in 2026, or in any earlier year, was not found in an archived HPOPS document, so no granted figure is stated here. This page uses the statute’s wording of the formula. Whether HPOPS posts an annual COLA notice on its participant portal or in a newsletter was not checked.
Where 2027 stands
No 2027 Houston Police COLA percentage is published in the sources read; the pension system actuary determines it under the statute.
Common mistakes
- Expecting a COLA every year. The formula can produce 0% when the smoothed return is at or below 5%.
- Treating the 4% ceiling as the COLA. It is the most the formula can produce, and a low smoothed return gives less.
- Assuming every retiree qualifies. The statute limits it to age 55 and older as of April 1, with named exceptions.
Related: Houston Police Officers’ Pension System retirement decisions, how public pension decisions work, and whether Texas taxes pensions.
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Answer againSources
- State of Texas, as posted by HPOPS, Tex. Rev. Civ. Stat. Art. 6243g-4: www.hpops.org
- Houston Police Officers’ Pension System, 2025 Summary Plan Description: www.hpops.org
- Houston Police Officers’ Pension System, Financial Statements as of and for the Years Ended June 30, 2026 and 2025: www.hpops.org
- Related official page (not quoted): IRS Tax Topic 410, Pensions and annuities: www.irs.gov
- Related official page (not quoted): IRS Tax Topic 411, Pensions: the General Rule and the Simplified Method: www.irs.gov
Read from the primary documents linked above on October 30, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the IRS itself is the right place to confirm anything consequential.