A Senate committee pushed forward Wednesday with a bill that would overhaul how local governments fund pensions for police officers and firefighters, hoping that a different political climate in 2014 will allow the legislation to succeed after it died in the House during the spring legislative session.
The legislation (SB 246), which won unanimous approval from the Senate Governmental Oversight and Accountability Committee, comes as cities say their pensions are dangerously underfunded and after the Department of Management Services has issued letters to several cities reinterpreting a key section of the law.
That reinterpretation gave local governments more freedom in how they used revenue generated by a tax on insurance premiums.
The proposal approved Wednesday would require retirement plans that are underfunded for future benefits by more than 20 percent to use half of any increase in insurance premium taxes over the amount they raised in 2012 to pay down that deficit. The rest could be used to fund other benefits.
Cities oppose that plan, saying the new interpretation of the state’s current law by the Department of Management Services gives them more flexibility in deciding how to use money raised by the insurance premium tax. Police and firefighters unions, though, say the plan goes too far. Until the new state interpretation of the law, new insurance tax revenues had to be used to fund additional benefits.
A similar, bipartisan bill passed the Senate last year but got bogged down in a conflict between the two chambers over the future of the Florida Retirement System, the retirement plan for other public employees.
House Speaker Will Weatherford, R-Wesley Chapel, pressed the Senate to approve a measure that would have prevented new employees from enrolling in the traditional pension plan in the Florida Retirement System and required them to join a 401(k)-style plan, but the upper chamber refused.
Sponsors say they hope to avoid getting into a similar situation when the 2014 legislative session begins in March.
“We’re very early in the process. But, in talking to my friends in the House, I am confident that we’re going to be able to decouple the municipal pension issue from the FRS issues, and we’re going be able to deal with this municipal pension issue on its own merits,” said Sen. Rob Bradley, R-Fleming Island.
Bradley has worked with Sen. Jeremy Ring, the Margate Democrat who chairs the Governmental Oversight and Accountability Committee, to craft the legislation.
Both sides of the issue are, at best, lukewarm about the idea. Kraig Conn, a lobbyist for the Florida League of Cities, rapped the proposal for essentially doing away with the part of the law that allowed for the Department of Management Services’ new interpretation.
Lawmakers are concerned that the new reading of the law could be overturned by a court.
“From the cities’ perspective we are losing the statutory basis for this current flexibility that we believe is essential to getting these pension plans back on a sound financial footing,” Conn told the committee.
Matt Puckett, executive director of the Florida Police Benevolent Association, said his group could likely work within the boundaries of the legislation, but he also said that many cities’ pension plans might look worse off than they are, considering the economic recovery that’s taking hold and the increase in the stock market in recent years.
“We think a lot of the problems can be self-correcting,” Puckett said.
–Brandon Larrabee, News Service of Florida
m&m says
All civil employees should not be allowed to organize ..
Local FD says
I started in the Fire Department at age 19. I am a member of the FRS and have been for almost 16 years. I am 9 years away from retiremnet. I am disgusted with conservative politicians in this state robbing the middle class of their promised retirement.
Futhermore, the private sector’s 401K style retirement is a joke at best. Large Business, and conservative politicians, lay the blame on public pensions to take the attention away from the true problem of the financial crisis- an Un-regualted banking, and investment industry.
Diana L says
Yes FD, and all the time trying to make the unions the bad guy. God forbid, to give the employees a voice.
Anonymous says
@Local FD says–Right on! I especially love it when I hear anti-union garbage coming out of the mouths of retired individuals who would not be where THEY are today if it wasn’t for unions and similar organizations that represent the rights of average workers. People forget about the horrible conditions in the past that have made such representation crucial. This is especially true given the influence of big business lobbyists in governmental operations and affairs. Too often, we forget that it is the labor force that produces the services and products we all depend on. Too many employers, private and public, are prone to exploit their employees, who feel they have little choice but to do whatever is required of them for a paycheck, even it what is required of them is unfair, dangerous, discriminatory or even morally repugnant. It is tragically comical how Republicans HATE governmental interference EXCEPT when it serves THEIR ends, such as promoting the special interests of big business and organized religion.