Panel OKs revamp of Fla. public employee pensions

Published: Friday, February 8, 2013 at 12:56 PM.

If passed, the proposal would be the second major change in the Florida Retirement System since Scott took office two years ago. A law passed in 2011 requires public employees to contribute 3 percent of their earnings to the system, in effect a pay cut.

Brodeur stressed that the bill would affect only new hires, not the retirement system's 623,011 current active members — those now working — or its 334,682 retirees.

Only about 25 percent of all covered employees are state workers. The rest are teachers and local government workers including law enforcement officers and firefighters.

"It doesn't hurt anybody who's currently in the system," Brodeur said. "It doesn't break any promises to those who haven't been hired yet and it doesn't ask for any taxpayer increases either."

Brodeur acknowledged that the Florida system now is one of the nation's best-funded and well-managed pension plans.

Financial experts say pension plans that are at least 80 percent funded are considered on solid ground because employees do not all retire at the same time. The Florida system was 87 percent funded as of last June and since then its investments have grown by $10 billion to $132 billion as a result of the ongoing stock market recovery.

In some years the fund has topped 100 percent. That's enabled the Legislature to divert about $12 billion in state contributions to other purposes over the past dozen years. Also, the 3 percent employee contribution is being used to reduce employer contributions instead of increasing the fund's assets. Public employers now contribute 3.55 percent for most workers.

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