A measure that would allow police officers, firefighters, and other special-risk employees to retire earlier is advancing in the House. But, as Sascha Cordner reports, there are a couple of provisions in the bill that opponents say would destroy the state’s pension plan system.
Republican Representative Ritch Workman says he wants a do-over on a massive pension reform plan he sponsored last year to correct a past mistake:
“After I passed pension reform last year, which increased the years and age of service for our special risk men and women, from 25 years of service to 55 years of age, extended that to 30 years of service or 60 years of age. I heard from a lot of firefighters and police officers that sixty was just too long. Sixty was just too late. Their body was just too worn down by the time they chased the bad guys and put out the fires for 25 or 30 years. The deal I struck was that I would work to reduce that back to where it has been since 1974 to 25 years of service at 55 years of age if I could do it at a revenue neutral point.”
The deal that he struck means that House Bill 525 would now increase the time that special risk employees must be enrolled in the Florida Retirement System, the state’s default pension plan, from eight years to 11.
The bill would also require new hires to automatically be put into the 401K investment plan, if they don’t place themselves in either plan after a year. Workman says he had to do that to make sure that pension costs did not rise.
But, police, firefighters, and other special risk employees were split, as most criticized that part of the plan.
“We love what this bill is intended to do by reducing the retirement age, but it’s very painful to watch how it is being paid for. We know it’s not a free benefit. There’s baggage on this bill. We’re concerned about how it affects other employee groups who are very concerned on the default to the investment plan.”
Robert Suarez was not the only one who felt that way. His colleague, Gary Rainey with the Florida Professional Firefighters pointed to Legislative data that shows if this bill is signed into law, it could cripple the Florida Retirement System:
“The most recent study, requested by the Senate, by Millman, which is the official FRS actuarials, shows that only about 25-percent of new hires choose the investment plan. By making the default plan the investment plan, that will throw the balance over. And, their actuarial prediction is that 54-percent of all new hires will now, by default, go into the investment plan. That will have a drastic effect on the sustainability of the pension plan, of the deferred benefit Pension plan.”
But, out of the many labor groups that spoke against, there were a few were in favor of the proposal, including the Florida Police Benevolent Association, which helped to draft the bill.
But, the group’s Executive Director Matt Puckett says though he too was not pleased with the changes to the Florida Retirement plan, he says it should be up to the labor groups themselves to let their members know about the change:
“I’m not thrilled with some of the changes either. I don’t like the default into the defined contribution plan, but a year is an adequate amount of time. It should be incumbent on some of us, the labor organizations, to educate our membership, to what we think maybe right.”
Workman’s bill passed largely along party lines on 12 to 8 vote, with Representative Paige Kreegel as the only Republican voting against it.