Pension fund gets some love from analystsby John Kennedy | February 28th, 2011
The state’s pension fund has consistently met its investment goals – fairly average compared to other states– but also is “financially sound,” a report released Monday shows.
The state’s Office of Program Policy Analysis and Government Accountability (OPPAGA) gave the $114 billion Florida Retirement System generally satisfactory marks in its review of the fund, which covers almost 1 million government workers and retirees.
The pension fund is a big target for lawmakers this spring, with Gov. Rick Scott proposing that employees contribute 5 percent of their paychecks to help finance their retirement benefits — saving the state $1.3 billion.
The money could help lawmakers patch a budget shortfall of at least $3.6 billion. But it also could help Scott make good on his campaign promise to reduce property taxes by $1.4 billion, something the GOP governor says he’ll do over the next two years.
As part of his push for changing the fund, Scott warns that the pension fund is on shaky financial footing.
OPPAGA disputes that. Anaysts acknowledge the FRS has a so-called funding ratio of 87.9 percent and currently does not have ”sufficient assets to pay current and future expected benefits for participants and their beneficiaries.”
But, OPPAGA points out, “experts generally consider public pension plans with funding ratios at or above 80 percent to be fiscally sound.”