Senate finds new compromise on pension, creates tiered rate
Teachers, firefighters and most state workers would pay differing portions of their salary into the Florida Retirement System but most state workers, who make $40,000 or less, would pay $900 a year or less, while those who make $25,000 would pay $500.
The changes are the third compromise emerging from the Senate and were added to SB 2100, the chamber's pension reform plan. The amendment, by Sen. Charlie Dean, R-Inverness, would create a tiered contribution system with two percent of the first $25,000 of a person's salary, 4 percent of any salary amount between $25,000 and $50,000, and 6 percent of the salary above that amount
Senators also agreed to:
- Returns the retirement age to 52 years of age or 25 years service for police, fire and other special risk officers
- Allows up to 300 hours of overtime to be calculated in retirement benefits for special risk officers
- Employees would have to work 10 years to vest in the pension plan, up from the current 6 years
- All elected officials and senior management employees must be enrolled in the 401k-style defined contribution plan beginning July 1, 2011
- The guaranteed interest accrued on contributions made to the DROP program increases from 6.5 percent to 2 percent
- DROP will be eliminated beginning in 2016
A proposal to impose a flat 7 percent contribution rate to all elected officials, including judges and county officials was postponed. In the House, members gave preliminary approve to a bill to impose a flat 3 percent contribution rate for all members of the Florida Retirement System.