A week after several cost-saving provisions of a state pension reform bill were removed, a second bill dealing with local government pension plans was softened Thursday in the Senate.
Senate Bill 1128 originally would have prohibited local governments from offering defined benefit plans to new employees, but was amended Thursday to allow for greater local control.
But many large Florida cities have pension plans that are out of control. Cities like St. Petersburg, Miami and Hialeah have underfunded pension plans.
It was policy. I dont believe that we had the support of the committee members, Sen. Jeremy Ring, D-Margate, said when asked why that provision was taken out of the bill.
Ring, who chairs the Senate Governmental Oversight and Accountability Committee that deals with state and local pensions, has worked with union leaders and other members of his committee in recent weeks to take out some of the most cost-saving parts of his pension bills.
Along with SB 1128, Senate Bill 1130 provides significant changes to the pensions of 655,000 members of the Florida Retirement System, about half of whom are school district employees. FRS employees hired after July 1 would not be offered a defined benefit plan under the bill.
This is about local control, which does not come into play in the FRS, Ring said when asked about the difference between the two bills.
New hires that are members of the FRS would instead be offered defined contribution plans similar to a 401(k) plan.
Despite the move to get more committee support by granting local governments greater leeway in developing their own plans, there were two holdouts on the committee that voted against the bill -- Sens. Gary Siplin, D-Orlando, and Mike Fasano, R-New Port Richey.
Im not a fan of getting involved in the issues at the local level. None of the cities in my district have a problem with their pension plans, Fasano said.
The bills were originally designed to help cut costs associated with the pension plan, but fall drastically short of Gov. Rick Scotts plans.
Gov. Rick Scotts proposed budget included plans to phase out the Deferred Retirement Option Program and the cost of living adjustment for FRS members, as well as reducing the annual accrual rates for many employees -- provisions which arent in the Senate bill.
Scott also called on state employees to contribute 5 percent of their salaries to their pensions. SB 1130 would impose a 2 percent contribution rate for regular-class and special-risk workers who make less than $75,000, and 4 percent from workers salaries over that amount, as well as from elected officials and other classes of FRS workers.
Scotts proposals were expected to save $1.3 billion in the first year, while the Senate bill would generate savings in the hundreds of millions, Ring said last week.
During a press conference Wednesday, Senate President Mike Haridopolos, R-Merritt Island, said he was not concerned with the discrepancy between Scotts proposals and the Senate bills.
Im very comfortable with where they are right now because theyve only been through one committee, Haridopolos said.
Reach Gray Rohrer at grohrer@sunshinestatenews.com or at (850) 727-0859.