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More changes to retirement plans of some state workers could be coming

TALLAHASSEE — On the last day of the 2012 session, state lawmakers voted to reduce contributions to the retirement accounts of 100,000 public employees, many of whom work in higher education or law enforcement.

The bill (HB 5005) passed both chambers by wide margins with little discussion and will soon reach Gov. Rick Scott, who said he has not decided whether to sign it.

The legislation reduces government contributions to employees enrolled in an investment plan, known as a defined contribution plan, as opposed to the traditional pension plan for public employees.

Police officers in the defined contribution plan, who are members of what's known as a "special risk" class, would see the state's contribution drop from 18.3 percent of an employee's salary to 12.3 percent.

The result is that employees in the plan will have less money available for their retirement than if the change hadn't been made.

"This is a drastic change," said Steve Klapka, a 25-year sheriff's deputy in Hernando County and longtime president of the agency's Fraternal Order of Police Lodge. "It's a disgrace, in my opinion. You can get a job at UPS, make more money and get a better retirement."

Klapka said he is near retirement, but younger officers who are still building a retirement nest egg will be hit harder by the change. He said Hernando deputies have not had a pay increase in more than four years.

Klapka said he met Scott last year when the governor attended funeral services for John Mecklenburg, a sheriff's deputy killed in a car crash. "I remember him saying, 'We've got to do more for law enforcement,' " Klapka said of Scott. "This isn't doing more for law enforcement. It's taking away."

The new rates are a side effect of changes legislators made to the pension plan last year, including requiring workers to contribute 3 percent of their pay to their retirement for the first time.

The changes match the reductions in employer contributions to the investment fund with those of pension fund members, so that the employer's costs are equal under both plans.

The bill would affect at least 103,345 employees. That was the number enrolled in the investment plan as of July 1, 2011.

"In all these bills, I have to look at how it impacts the budget," Scott said.

Scott's office has received emails from law enforcement officers urging him to veto the bill. Cpl. John Bartis of the Collier County Sheriff's Office in Naples said the bill will discourage future employees from switching from the traditional pension fund to the investment plan, in which employees manage their money.

Employers generally prefer defined contribution plans because the costs are more predictable.

"Based on these changes, it will be necessary for me to work much longer to make up the difference," Bartis told Scott in an email. "Sir, my family and I voted for you. We know changes had to be made to make government more efficient, but taking away from good, loyal, hard-working employees was the furthest thing I thought you would do."

The bill also reduces colleges' and universities' contributions to workers enrolled in an optional retirement program, or ORP, from 7.4 percent of an employee's salary to 5.1 percent.

The bill passed the House, 82-35, and the Senate, 34-2, on the session's final day.

Sens. Jeremy Ring, D-Margate, and Mike Fasano, R-New Port Richey, cast the only dissenting votes in the Senate.

Ring said he could not get "good, clean answers" as to how the bill would affect employees of state universities and colleges who participate in optional retirement programs.

Fasano, the only Republican in the Legislature who voted no, said the bill surfaced in the final hours, and he wasn't convinced it was in the best interest of public employees.

He said he has since learned that about 100 employees of the Pasco Sheriff's Office could lose retirement benefits as a result.

"It's easier to explain a no vote than it is to explain a yes vote," Fasano said. "I had concerns."

Steve Bousquet can be reached at bousquet@tampabay.com or (850) 224-7263.

More changes to retirement plans of some state workers could be coming 03/29/12 [Last modified: Thursday, March 29, 2012 10:39pm]
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