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Weakened Pension Reform Bill Moves Through Senate Committee

March 9, 2011 - 6:00pm

A Senate pension reform bill that was already short of the savings included in Gov. Rick Scott's budget proposal passed through its first committee Thursday, and was weakened further in the process.

Gov. Scott has eyed $1.3 billion worth of savings to the Florida Retirement System, but Senate Bill 1130 does not include many of his budget proposal's cost-saving measures --like eliminating the Deferred Retirement Option Program, ending cost of living adjustment increases and reducing annual accrual rates to 1.6 percent for most workers.

The bill, sponsored by Sen. Jeremy Ring, D-Margate, who chairs the Government Oversight and Accountability Committee, requires the 655,000 participants in the state pension system to contribute a portion of their salaries to their retirement, but that provision is still less than the contribution rates called for by Scott.

The Senate bill calls for regular-class or special-risk workers to contribute 2 percent of their salaries up to $75,000. Employees in those classes who earn more than that would contribute 4 percent of their salary over $75,000 to their pension. Scott's plan would require all FRS members to contribute 5 percent of their pay to the system. Before Thursday, contribution rates were not specified in the bill, but amendments offered by Sen. Jack Latvala, R-St. Petersburg, were tacked onto the legislation.

Ring said he was pleased with the extensive public hearings and testimony -- 16 hours' worth by his estimation -- and thought that the changes in the bill reflected the input and concerns of unions and local government officials. He had hopes of a unanimous vote, but was disappointed when Sen. Gary Siplin, D-Orlando, cast the sole vote against the bill.

Id like an appreciation of the fact that we didnt rush this process at all, Ring said.

Siplin quickly exited the committee meeting after the vote and did not take questions from reporters.

Originally, SB 1130 also eliminated the practice of including overtime pay and unused benefits as part of an employee's base salary in determining a pension benefit, but another amendment added Thursday allowed for $300 of overtime to be included in base salary calculations.

Senators were quick to point out that they did not want to fix Florida's $3.6 billion budget deficit solely on the backs of government workers. Sen. Jim Norman, R-Tampa, added an amendment that would halt employee contributions into their pension plans after the FRS became 100 percent funded. The FRS is currently funded at 87 percent of its liabilities.

If the system is 100 percent funded, the contributions would stop, its that simple, Norman said.

Notably, a bill that was derided by a room full of members of police and firefighter unions last month was roundly applauded Thursday after the amendments were tacked on.

Ring said the bill as currently constructed could provide savings of "hundreds of millions of dollars," but he acknowledged that the bill could change again once updated revenue numbers roll in later this month and SB 1130 goes before the Senate Budget Committee. Any savings not found in the pension system are savings that must be found elsewhere in the budget.

"I'd say that's fair," Ring said.

Reach Gray Rohrer at or at (850) 727-0859.

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