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Florida House bill would raise retirement age for state workers

TALLAHASSEE — A House committee rewrote Gov. Rick Scott's pension reform plan Thursday by raising the retirement age of all workers, including police officers and firefighters, and rejecting his call for ending defined pensions for new workers.

But the House Governmental Operations Committee approved a bill that includes Scott's proposal to require public employees to pay 5 percent of their salary to cover part of their pension costs, a move lawmakers say will save state and local governments an estimated $720 million a year. The state now pays all pension costs.

The bill did not include Scott's plan to eliminate cost-of-living adjustments for all retirees. Instead, the committee voted to lengthen the time police, firefighters and other special-risk employees work before they can retire from 25 to 30 years, or from age 55 to age 60, whichever comes sooner. For everyone else, the retirement age would rise from age 60 to age 62 years, or after 33 years of service instead of 30.

The Republican-dominated committee approved the bill along a party-line vote, despite warnings from law enforcement and firefighters who said that requiring them to work longer in high-risk jobs before they draw their retirement will endanger the public.

"Our governor has made it clear, and rightly so, that pension reform is needed and it is needed now," said Rep. Debbie Mayfield, R-Vero Beach. "It's time for public pension plans to look more like private pension plans."

Opponents challenged that conclusion and suggested that the motive for the proposed pension changes was to fill the state's $3.6 billion budget deficit on the backs of public employees.

"I think it is patently unfair to talk about how we want to be more like the private sector but we only want to be like the private sector in one small area —because that's what allows us to cut," said Rep. Jeff Clemens, D-Lake Worth. He called the bill a "salary tax" and suggested the state could save just as much money by closing tax loopholes.

The bill, by Rep. Ritch Workman, R-Melbourne, mirrors the portion of Scott's plan to get public employees to take what amounts to a pay cut by requiring they pay part of their pension costs. The bill also excludes Scott's proposal to change retirement plans for university employees and his elimination of the deferred retirement program, known as DROP.

While the proposal could save the state money, it also will cost an estimated $414,000 in additional administrative costs and will lead to unknown liabilities as state workers leave the state work force and take their pension contributions with them.

Rep. Marlene O'Toole, R-the Villages, who sponsored the amendment to lengthen the retirement age, said there already are more than 6,400 police and fire employees who are eligible to retire at 55 but have stayed on past their retirement age.

Rep. Alan Williams, D-Tallahassee, warned that the salary cut to the 655,000 teachers, firefighters, police, judges and administrative workers would siphon $720 million from the Florida economy.

"There are 720 million reasons why we shouldn't support this bill," he said.

In the Senate, the Governmental Oversight and Accountability Committee has approved a pension overhaul that limits employee pension contributions to 2 percent of salary for employees making over $40,000 and 4 percent for employees making more than $75,000.

Meanwhile, cities and counties who overpromised and underfunded their public pension accounts would get an injection of cash to repair their ailing programs under a pension reform bill passed Thursday before the Senate Governmental Oversight Committee. That committee voted to allow local governments to use revenue from the insurance premium tax and accumulated excesses to pay their unfunded liabilities.

The committee amended an earlier version of the bill and lifted a ban on local governments from offering defined benefit plans. It also allowed some employees to continue to use accrued sick leave or annual leave in the calculation of retirement benefits.

A number of union representatives said the amendments had improved the bill but they continued their opposition to the plan, including a cap on the number of overtime hours that can be used to calculate retirement benefits. The committee set the cap at 300 hours.

Mary Ellen Klas can be reached at meklas@miamiherald.com.

Florida House bill would raise retirement age for state workers 03/17/11 [Last modified: Thursday, March 17, 2011 10:48pm]
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