The Florida Senate set itself on a collision course Monday by approving a proposal overhauling local police and fire pensions but ignoring a more sweeping plan that cleared the House last week.
The Senate approach (CS/SB 246) give cities a chance to use the state’s insurance premium tax to bolster police and fire pension funds.
With the support of police and fire unions, the bill relaxes a 1999 law that required cities to offer only new benefits with these tax dollars, a move that analysts say has contributed to many funds now becoming financially troubled.
“This is one of the great crises facing Florida,” said Sen. Jeremy Ring, D-Margate, who has been working four years on trying to forge a consensus on local pensions.
The House, however, has merged a similar pension bill with a larger change to the Florida Retirement System. The FRS rewrite has little support in the Senate, and the House tactic is clearly aimed at trying to muscle senators into accepting it if they want to repair local pensions.
Ring acknowledged that in the session’s closing week, it’s difficult to predict the local pension bill’s fate. But he said it is poised to improve retirement accounts across Florida.
“If and when this bill passes, we won’t be involved in local pensions again,” Ring assured senators.
The Leroy Collins Institute at Florida State University has studied the state’ municipal pensions, sounding alarms about the financial health of many plans.
Those drawing low marks in the 2011 review, included Boynton Beach’s police plan and Palm Beach Gardens’ police and fire plans – while West Palm Beach’s police pension was named among the best-funded in the state.
The study concluded that the municipal pension slide began in the early 2000s, well before the recession. The timing is close to when Gov. Jeb Bush and the Republican-led Legislature approved changes which improved city police and fire pensions.
The law was effectively a payback for unions which endorsed Bush over Democrat Buddy MacKay in the 1998 governor’s race.