By Yaël Ossowski | Florida Watchdog
TAMPA—In the Supreme Court of Florida on June 11, attorneys for Gov. Rick Scott filed the first brief in their appeal against a lower court’s ruling barring mandatory pension contributions from state employees.
The state listed numerous reasons for appealing the decision by Leon County Circuit Court Judge Jackie Fulford, but ultimately defended its actions by arguing that they are “within their authority” to enact pension reform because of financial constraints.
Previously, state employees contributed no portion of their salary to their retirement.
“When revenues expand, government agencies can increase retirement benefits for public employees. But in financially challenging times such as these, the Legislature must be able to adjust its future pension commitments,” stated the brief.
The court is expected to decide the case by September.
But as the state takes to the courts to defend its reform of public sector pensions for its employees, municipalities across Florida slowly are beginning to enact their own changes, often with just as much protest and hostility as is being played out in the Supreme Court.
“It’s only natural to expect that anytime you have changes where you’re impacting the benefits that employees have counted on and made plans for their future based on, you’ll have people who feel very upset and concerned,”said Raelin Storey, public affairs director for the city of Hollywood in Broward County.
Storey explains the current situation in the coastal city of nearly 140,000, which was forced to declare a state of fiscal urgency last year when the city realized it would be have a $25 million budget shortfall.
“The city was forced to institute changes in salary and benefits right away, freezing current pensions and changing multipliers that configure into how much each employee gets,” Story said.
She said that local police and fire unions were enraged by the forced changes to collective bargaining, and become active in pressuring the City Commission to forgo any large cuts to their retirement pensions.
A municipal pension report card put out by Florida State University‘s Leroy Collins Institute last November, Tough Choices Facing Florida’s Governments, rated Hollywood’s police and fire pensions as some of the worst in the state, both given an F and estimated to cost upwards of $50,000 per participant, much higher than other cities in the state.
In 2007, the last year included in the report, the firefighter’s retirement Plan in Hollywood was 48 percent funded while that of the police officers was 58 percent funded.
“It is not often that any immediate change will take root, it will definitely take some time,” said David Hatkin, assistant professor of public policy at Florida State University and a co-author of the report.
“This has really become an important subject in many cities and municipalities in Florida. People are starting to realize (that) we really need to sit down and tweak this to make for a more sustainable path,” said Hatkin.
In Hollywood, the issue even boiled to the point of being brought to the voters in a citywide referendum, where 58 percent of the population favored reform of the general public employee fund and 55 percent for firefighters and police.
The general employee fund was graded as a D on the Collin’s Institute’s report card.
“It’s the city’s job to manage the city’s resources, and that really puts us in a tight place,” Storey said.
“Pension costs continue to rise, but we believe that we have reversed the trajectory and made our pensions much more sustainable.”
Looking across the state, David Hatkin sees many cities that are embracing reform before they are in the same dire straits as Hollywood.
“What cities actually need to look at is the cost per participant — this really defines how a plan will survive in the long term,” said Hatkin.
“Right now if you look at the cities of Clearwater, Miramar and Palm Beach, they’re examining the problem and changing their plans accordingly.”
Matt Puckett, executive director of the Florida Police Benevolent Association, disagrees.
As the main police officer union in the state of Florida, his organization has been at the forefront of protecting public pensions for their members.
“Whether it is at the state level or in these small municipalities, we have been very active in the negotiations and in these cases,” said Puckett.
“But we remain reform-minded and we actively look at the abuses on both sides.”
Referencing the state pension case being introduced to the Supreme Court, Puckett said he remained hopeful that the judge ultimately will uphold the decision of the lower court.
“We feel that the judge reached a very solid decision in the last case, and we remain opposed to any additional contributions,” said Puckett.
“It is a sweeping change that represents a violation of our contracts and of our right to collectively bargain.”