Senate Bill 84, filed by Sen. Ray Rodrigues, R-Estero, would require new public employees enroll in a 401(k)-type investment plan rather than in the Florida Retirement System (FRS), the nation’s fourth-largest public pension plan that serves about 5.1 million Floridians, including 4.425 million retirees.
According to SB 84’s legislative analysis, the 51-year-old FRS carries $36 billion in “unfunded liabilities,” the gap between assets and obligations, an exposure critics insist put the state at risk.
The bill offers an “investment plan” as an option to more than 644,000 active employees, 432,258 annuity recipients, 15,512 disabled retirees and 33,593 enrolled in the Deferred Retirement Option Program (DROP).
Author(s): John Haughey
Publication Date: 2 March 2021
Publication Site: The Center Square
After years of discussions about the tricky issue of overhauling Florida’s retirement system for government employees, a Senate committee this week approved a proposal that would shut future workers out of a traditional pension plan.
The proposal, sponsored by Senate Governmental Oversight and Accountability Chairman Ray Rodrigues, R-Estero, would require new employees as of July 1, 2022, to enroll in a 401(k)-style “investment” plan. Employees currently are allowed to choose whether to take part in the pension plan or the investment plan.
Rodrigues, whose Republican-controlled committee approved the bill (SB 84) in a party-line vote, said lawmakers have to make “difficult decisions” to maintain the long-term solvency of the pension fund. He pointed, in part, to a $36 billion unfunded actuarial liability, which is essentially a measurement of whether the fund is projected to have enough money to meet its future obligations.
Author(s): Jim Saunders
Publication Date: 5 February 2021
Publication Site: Tampa Bay Times