Florida

FLORIDA RETIREMENT SYSTEM

Florida Supreme Court upholds law requiring state workers to contribute 3 percent of pay to state pension plan

 

The ruling means that state and local workers in the Florida Retirement System will have their salaries permanently reduced to offset three percent of the state’s contribution to their retirement accounts.

The Florida Supreme Court gives the state a major legal victory and rules Florida can charge state workers three percent of their salaries to help pay for their pensions. Video by News Service Florida:


Herald/Times Tallahassee Bureau

He said the state’s action “constitutes a confiscation of private property of a few for a public use” and concluded that all public employees “who were members of the FRS prior to July 1, 2011, have had their contract rights violated.’’

Perry said the action by lawmakers amounted “to an insufferable and unconstitutional ‘bait and switch’ at the expense of public employees.’’

But Pariente defended the ruling and, in her concurring opinion, said the decision should not be viewed narrowly.

“Ultimately, I recognize the frustration of state employees who have in effect experienced a 3 percent reduction in their net pay as a result of the Legislature’s changes to the retirement plan,’’ Pariente wrote. “Indeed, these changes affect judges and all judicial branch employees as well,’’ she said. "However, this case is not a referendum on the Legislature’s policy decision."

Union officials disagreed with the ruling, some of them vowing to use it to replace the governor and Republican-led Legislature in the 2014 election.

“Balancing the state budget on the backs of middle-class working families is the wrong approach for legislative leaders and the governor to take,’’ said FEA President Andy Ford. "The 2014 campaign begins today.”

Matt Puckett of the Florida Police Benevolent Association said that while members “obviously are disappointed” they hope to keep any future reforms to the pension system “to a minimum.’’

“We’re a nation of laws. We respect the decision of the court. It seems well reasoned. We’ll deal with it,’’ he said.

Broward Teachers Union President Sharon Glickman said Florida’s public employees “were promised a non-contributory retirement and our state is turning its back on this promise with today’s ruling.”

Joe Vitalo, president of the Hernando Classroom Teachers Association, said the decision will mean that about $2.5 million will be taken out of the local economy to pay for the retirement contribution of the 3,100 employees in the county system.

“That’s money that’s not in our local economy," he said. “That would have a greater impact on the local economy than anything else."

Lawmakers argued at the time that the change was needed to fill a $3.6 billion budget gap and bring Florida in line with 47 states that require their government workers to contribute to their pension plans. The savings was then plowed back into the budget, not into the retirement fund.

Union leaders said they hope the improved fiscal conditions will allow lawmakers to grant state employees pay raises for the first time in six years, to offset some of the cost of the cut to their pay from the retirement change.

Senate budget chief, Sen. Joe Negron, R-Palm City, said the issues aren’t linked.

"We’re well aware that state workers haven’t had a raise in six years, as is the case with the private sector. It’s one thing we’ll consider."

But some lawmakers are already viewing the money as a budget windfall.

Sen. John Thrasher, R-St. Augustine, said Thursday’s decision allows lawmakers to consider many options. He wouldn’t rule out a raise for employees but also suggested it could be used to help pay for more school resource officers in the wake of the Newtown, Conn. shootings.

House budget chief, Rep. Seth McKeel, R-Lakeland, said that if current conditions hold, the ruling provides lawmakers with needed certainty this budget year and "Florida will be able to have a more normal budget."

Tampa Bay Times staff writers Michael VanSickler and Danny Valentine contributed to this report. Mary Ellen Klas can be reached at meklas@MiamiHerald.com and @MaryEllenKlas

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