A Senate bill reforming Floridas state pension system falls short of the measures and savings outlined by Gov. Rick Scotts budget recommendations, and could require more work as it moves through the committee process.
Senate Bill 1130, sponsored by Sen. Jeremy Ring, D-Margate, who chairs the Government Accountability and Oversight Committee, is one of two he is pushing in an effort to scale back the retirement benefits of state and local government workers.
Many see pension reform as a necessary component of an effort to cut spending in the face of Floridas $3.6 billion budget deficit, but others on Rings committee are wary of balancing the budget on the backs of government workers.
Rings bill calls for members of the Florida Retirement System to contribute to their pensions, but leaves the exact contribution amount undefined. Amendments offered by Sens. Jack Latvala, R-St. Petersburg, and Jim Norman, R-Tampa, Thursday during a committee meeting would cap the contribution rates at 2 percent for special class members and 6 percent for senior class members, and end the contributions entirely once the FRS becomes fully funded.
The FRS is currently funded at 87 percent of its liabilities. Latvala said he wants his fellow senators to clarify whether they are trying to balance the budget through pension reform or merely shore up the system.
We just need to be honest about what were doing, Latvala said. He added later that the FRS has been funded at 100 percent or more of its liabilities in 11 out of the last 13 years, and that a better performing stock market could help boost its current percentage when new revenue estimates are released next month.
Ring pointed out that a solid pension system and a balanced budget are both valid reasons for pension reform, but also noted that his bill does not include many of the provisions suggested by Gov. Scott.
There are lots of reasons to do this. One is the liability, but one is also a $4 billion budget hole we have to fill, Ring said.
But his bill does not eliminate the Deferred Retirement Option Program or the cost of living adjustment, and doesnt reduce the annual service credit, as Gov. Scotts proposed budget recommends. Scott says those changes, along with shifting all new employees into a defined contribution plan akin to a 401(k) investment -- a provision Rings bill does include -- can save the state $2.8 billion over the next two years.
Sen. Mike Fasano, R-New Port Richey, also offered amendments that would prevent double dipping -- the practice of taking retirement from one government job and then accepting a different one somewhere else, thereby pulling down both a pension and a salary -- and reduce the annual accrual rates of judges and elected officials to 1.6 percent.
But some of his fellow legislators were concerned about the constitutionality of an amendment that would prevent someone from seeking elected office, since Fasanos measure would bar those who accept a state retirement package from getting another job on the FRS, including an elected office.
How can we preclude anyone from running for public office? asked Sen. Charles Dean, R-Inverness.
Fasano said that current law already prohibits people from running for office if it falls within six months of taking their retirement from FRS, so constitutional concerns wouldnt apply.
The committee did not vote on any of the amendments nor on the bill itself Friday.
Reach Gray Rohrer at grohrer@sunshinestatenews.com or at (850) 727-0859.
