It might be be premature to make any decisions until the details are known.
As you are no doubt aware, Governor Scott is slipping tidbits about his plan for FRS into the news. Unfortunately, those tidbits are sparse in detail and his full plan is not scheduled to be released until February 7, so it is very difficult to get a grasp of how they will ultimately affect Florida Retirement System workers and retirees. It is obvious the changes, IF ENACTED, will be significant. It might be be premature to make any decisions until the details are known. In the meantime, 1,000,000 strong FRS participants and retirees should be contacting their legislators and directing those representatives as to how they want to be represented in Tallahassee.
House Bill 303 was introduced by Representative Fredrick Costello (click for contact information)of Ormond Beach. It is a far reaching and devastating proposal.
THIS BILL WAS WITHDRAWN AT 4:28 THURSDAY, JANUARY 27, 2011. ONE WEEK AFTER IT WAS PROPOSED!!!!
House Bill 303 was introduced by Representative Fredrick Costello (click name for contact information)of Ormond Beach. It is a far reaching and devastating proposal for Florida Retirement System members, particularly FRS Special Risk members. The bill was filed just today, so we have had very limited time to study it. Please note also, that we are not lawyers, so some of the language is somewhat subject to interpretation, but as we read it, the bill includes the following changes:
Service credit would be reduced from 3% to a maximum of 1.6% for ALL employees for future service after June 30, 2011. Higher credits for previous years will be honored, but all future years for ALL employees will be reduced to 1.6% per year. (HB 303, lines 112-125)
Effective December 31, 2012 the Deferred Retirement Option Program (DROP program) is terminated for ALL members. Those already in the DROP will be paid out and terminated. (HB 303, lines 147-152)
Continue reading “FRS Legislative Alert, HB 303”
Judging from the amount of media coverage the Florida Retirement System and your benefits are receiving, it isn’t a question of whether there will be changes made this legislative session, but a question of what change and how much.
“Change is inevitable”…
After last weeks run-in with HB 303, we might review the overall challenge to FRS Participants. Judging from the amount of media coverage the Florida Retirement System is receiving, it is not a question of whether there will be changes made, but a question of what change and how much. Our newly inaugurated governor, Rick Scott, has made it very clear that he believes FRS is a “ticking time bomb”. Last year’s legislative session included over 35 bills introduced to make changes at FRS, and we can speculate that those proposals might simply be foreplay for this session’s action. Governor Scott has announced he will make his recommendations known by February 4th.
The Florida League of Cities has waged a full scale war against your Pension. Representatives and Senators from both parties, from Senate President Mike Haridopolis, a Republican, to Senator Jeremy Ring, a Democrat and chairman of the Senate panel that is considering the changes, are out to change the Florida Retirement System. Senator Mike Bennett announced his intention to introduce legislation to make sweeping changes months ago (See Is Florida Paying Former Employees too much). Florida Tax Watch has recommended far-reaching changes of the Florida Retirement System
Why is this such a major issue all of a sudden? As of the FRS Annual Report from June 30, 2008, the Pension Trust was slightly “overfunded”. When Lehman Brothers went bankrupt in September and created a financial panic, the assets in the plan dropped significantly, and the fund became “underfunded” for the first time in 11 years. As of the most recently published annual report, for the period ending June 30, 2009, the fund was only 87.5% “funded”, with some $96.5 billion. According to the MyFRS website, as of December 31, 2010, the FRS pension assets were up to almost $124 billion. That is putting the fund assets back on par with where they were in 2008 when it was fully funded, and is a gain of some $30 billion since the 87,5% funding report . According to the FRS and SBA Annual reports, the amounts are as follows:
Continue reading “FRS Change Ahead”
… it would be implausible to believe significant changes aren’t in store for FRS people and their benefits in the 2011 session.
The Florida Senate “Interim Work Plan 2011 Session” has been published on the Florida Senate Website, and there doesn’t seem to be any entry or schedule for the “Summer Study” that was promised (please see FRSOptions post “All FRS Legislation put on hold”). During the 2010 Legislative Session, Senator Mike Bennett announced that all changes to FRS would be put on hold pending a summer study on how the legislators should best proceed in making potential changes. The pending study provided a respite for Florida Retirement System participants, as none of the thirty-plus bills that had been introduced in the 2010 session came to fruition.
In the absence of the study it is unclear what course the legislators will take. Hopefully it will not be a repeat of the maelstrom of bills introduce this past session. It appears the press has been enlisted to a large degree, as there is seldom a day goes by that an article doesn’t appear condemning the Florida state pension plan and the Deferred Retirement Option Plan (DROP) as being overly generous, and an unfair liability to the taxpayers of the state of Florida. (We attempt to post a sampling on a regular basis on our sister site on Facebook.com/FRSOptions).
In light of the previously proposed bills, the vetoed changes, and the changes suggested by the “Florida Tax Watch”, which is a lobbying group that boasts of several prominent Legislators including the following:
Continue reading “Be Prepared !”
the FRS Pension Plan has enough assets to pay ALL of its retirement obligations for roughly the next 30 years! If that is the case, why should any benefits be cut? Why do the legislators feel it is so important to bolster a financially strong plan?
Governor Charlie Crist vetoed the impending cut in the DROP interest rate last Friday (See HB 5607) and stated his veto was because “the legislators unfairly popped the changes into the budget” (see tallahassee.com/article) . We discussed that fact in our April 28th post Drop Rate Dropped. It would seem the Governor has clamped down on the unfair process used by the legislators to cut benefits and increase funding for the Florida Retirement System. Perhaps the important question for participants (and taxpayers) to have answered is Why is the legislature seeking random solutions before clearly defining the problem. What is the motive for the legislature’s attempts to cut FRS benefits, and to increase employer and employee contributions to the plan?
The press has labeled Crist’s veto as a political move so he can identify himself as an independent. If that is the case, so be it, it was still the right decision. Your Florida Retirement System benefits should not be a pawn in some gambit in Tallahassee.
Starting early in the Legislative session, your benefits have been at risk. Some of the proposed bills were pretty severe in their proposed cuts (A Call for action, HB 1319 and 1543). All of the proposed bills were put on hold pending a “summer study” by the legislature. From input and conversations with all of you, the question is What is the purpose of the study? Is the legislature exploring whether changes should be made in FRS, or has the legislators already determined cuts should be made, and the study is simply to determine what changes? I think it bears some exploration.
Continue reading “Ask Why?”
FRSOptions.info has just learned that HB 5701 has been dropped. The Health Insurance Subsidy benefit will not be lost!
FRSOptions.info has just learned that HB 5701 has been dropped. The Health Insurance Subsidy benefit will not be lost!!!! This is great news. It seems your calls and letters have once again worked their magic! Congratulations!
It is possible it will be re-visited in the future, but for now it is safe. 250,000 retirees will keep this benefit!! The Health Insurance Subsidy is a benefit for Florida Retirement System members that provides up to $150 per month to offset the cost of health care in retirement.
While this is a short term victory, PLEASE keep those calls and letters going to your Representitives and Senators. It is your voices that have made, and will make a difference in whether your benefits are changed. You have been promised those benefits, and you deserve to keep those benefits!
Continue reading “HB 5701 Dropped. H.I.S. stays!!!”
Last week Senator Mike Bennett, Chair of the Senate Community Affairs Committee (and sponsor of SB 1902.) mentioned in committee “that all of the retirement bills will be rolled into a study for over the summer.” This would … tentatively put the retirement benefits bills on hold, most likely until the next session of the Florida legislature
Last week Senator Mike Bennett, Chair of the Senate Community Affairs Committee (and sponsor of SB 1902.) mentioned in committee “that all of the retirement bills will be rolled into a study for over the summer.” This would include the most adverse, HB 1319 and HB 1543, in addition to SB 1902 and SB 2022, and tentatively put the retirement benefits bills on hold, most likely until the next session of the Florida legislature. We will try to get verification on this as soon as possible.
It is my understanding the legislators were so overwhelmed with calls from YOU, and there was such an outpouring of concern, that the decision was made to table all bills relating to retirement benefits until after a special study could be done over the summer to determine the best route to take. This is not a victory! It most likely means the committee will meet a consensus of what changes to make to your benefits, and it will then be easier to pass the bills in the next session of the legislature.
I would again remind everyone of the 125 page report from the Florida Tax Watch group. You may recall this group consisted of many powerful members of the Florida Legislature (Previous discussion at FRSOptions). It would be a mistake to believe that the summer study will not propose cuts to your benefits, and it would not be coincidental if the final version corresponds to the Tax Watch proposal.
Continue reading “All FRS Legislation put on HOLD?”
this plan is being endorsed by the legislature, and by publicizing it around the state, it becomes propaganda to endorse the bills to cut your benefits. I also thought it was interesting that some of our elected officials were on the task force.
Yesterday there was an interesting “letter to the editor” in the “Sarasota Herald Tribune”, called “State Budget Sense”. The letter was submitted by the CEO of a Tallahassee organization called Florida Tax Watch, and lists “87 ideas worth $3.25 billion” to reduce spending. I’m not really sure who the group is, nor their function, but on their website states that they are “supported by voluntary, tax-deductible memberships and grants” and that “policy makers and government employees have implemented three-fourths of Florida TaxWatch′s cost-saving recommendations, saving the taxpayers of Florida more than $6.2 billion”. It sounds like a lobbyist group, which would answer the question of, why would the CEO of a Tallahassee Group, write a letter to the Sarasota Herald Tribune? I was intrigued enough to go to the site, and look at the 125 page report. Among their suggestions, which have pretty much ALL appeared in recent legislative proposals: Employee contributions to the plan of 5% (SB2022 is starting the process at a lower number to get in the door), Reduce the Credit for Special Risk from 3% to 2%, and for Senior Management from 2% to 1.6% (Think HB 1319 and 1543), Re-evaluate and reduce the who is considered Special Risk, Up the vesting schedule from six years to ten years and last-but-not-least, adjust the 3% COLA increases to the actual Consumer Price Index with a maximum of 3%. Obviously this plan is being endorsed by the legislature, and by publicizing it around the state, it becomes propaganda to endorse the bills to cut your benefits. I also thought it was interesting that some of our elected officials were on the task force. They are as follows:
Senator JD Alexander, Chairman of the Senate Policy and Steering Committee on Ways and Means and Designee of the Senate President to the committee.
Bill McCollum, Attorney General for the State of Florida.
Continue reading “It ain't over, A further call to action for FRS benefits!”
SB 2022 was introduced by Senator J.D. Alexander …. has already passed through the Senate Committee in very rapid manner. It will mandate all employees make a payroll contribution to their retirement benefits.
Please do not think the war is over to protect your benefits. While Representative Grady’s office has indicated HB 1319, which is particularly radical in its changes, is dead, it still appears on the legislative slate. HB 1543, another really nasty bill, shows up as having been withdrawn on the legislature’s slate. Senate Bill 2022 is a relative newcomer, and is very much in play. SB 2022 was introduced by Senator J.D. Alexander, a very powerful figure in Tallahassee and the Chairman of the Ways and Means Committee, and has already passed through the Senate Committee in very rapid manner. It will mandate all employees make a payroll contribution to their retirement benefits.
It is an interesting coincidence that the two most radical bills were withdrawn concurrent with the introduction and rapid push through committee of SB 2022. In comparison to HB 1319 and HB 1543, SB 2022 looks like a dream. I am hoping that wasn’t the plan. Scare everyone with radical changes, then a seemingly innocuous bill comes up, and it might be more easily pushed through. I am hoping this isn’t the legislative version of “good cop, bad cop”. If FRS participants are mandated to pay a portion of their pay, where does it end? Next year will it be more and more? The national average for employee contributions to pensions is around 5%. That is a significant cost to you!
Below is a list of about 30 different bills that have been introduced and are still on the table that could negatively affect your benefits in one way or another. I would urge you all to keep on your toes, and continue to call your Representatives and Senators and let them know you do not want them to vote in favor on ANY bill or amendment which will take away your benefits. Simply click on the blue link and it will take you to the Florida Legislature site where you may review the status and original version of the bills.
Continue reading “A battle won, but the War is still on to preserve your benefits.”
Congratulations! I can’t help but think your actions, calls and messages played an important part in this huge Victory!!!
Congratulations! I can’t help but think your actions, calls and messages played an important part in this huge Victory!!! As soon as I can get official confirmation in writing, I will post it!
There are a few other bills still alive, but none even close to those two. This is fantastic news to all members of the Florida Retirement System Pension Plan.