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State Senate tones down pension reform plan

TALLAHASSEE — A Senate committee agreed Tuesday to tone down its pension-reform plan after local government unions warned it would punish city workers and hurt healthy retirement funds.

Under the changes proposed in an amendment by Sen. Jack Latvala, R-St. Petersburg, the Senate would no longer require all new city employees to enroll in a 401(k)-style retirement plan, potentially threatening the financial health of traditional defined benefit plans.

If cities want to end enrollment in their traditional pension plans, they can negotiate with unions to have new employees join a defined contribution plan, which is similar to a 401(k).

The proposal also removes a requirement that employees' final retirement benefit be based on five years of service, as the Senate bill originally said, and allows cities to include up to 300 hours of overtime when calculating retirement benefits, since many cities now require police officers and firefighters to work overtime hours, Latvala said. The bill still prohibits employers from including unused leave and other compensation when determining retirement compensation.

The changes were commended by police and firefighter unions, which had blasted the Senate proposal at a workshop Friday.

Since unveiling the bill a week ago, senators have been besieged with calls and e-mails from union members fearing for their retirement accounts. Sen. Jeremy Ring, the Margate Democrat who chairs the committee, said he hopes that Tuesday's changes, which are expected to be voted on in early March, prove that the Senate has no intention of passing "a union-busting bill."

Still unresolved are differences between the unions and the Senate over proposed changes to the Florida Retirement System, which handles pension accounts for state, county, school districts and some cities. The Senate committee will take up that bill Thursday.

The Senate's more union-friendly proposals weren't embraced by everybody, however. Ron Silver, a former state senator and lobbyist for the city of Miami sanitation workers and general employees, called it "a terrible bill."

"The acceptable amendment is to strike everything after the enacting clause,'' he said. "The concept of trying to regulate local pension plans is wrong and, quite frankly, I don't believe it's legal."

John MacNamara of the Metro Broward Professional Firefighters warned that the Senate bill assumes it will result in savings to strapped local governments

He criticized lawmakers who said the state needed to intervene because unions "had so much power."

"If we had that much power, we wouldn't even be having this conversation today,'' he said.

State Senate tones down pension reform plan 02/22/11 [Last modified: Tuesday, February 22, 2011 9:09pm]
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