Guaranteed pensions — all but extinct in the private sector — are alive and well for government workers.
Many receive payouts most hard-working Floridians can only dream about.
According to state records, 1,223 retirees vested in the Florida Retirement System, the state’s largest public pension program, will receive six-figure pensions this year — a 25 percent increase from 2013.
Once a FRS pension plan member retires, their defined benefit increases over time because of cost-of-living adjustments.
That’s a deal only 7 percent of private sector workers get, according to the Employee Benefit Research Institute.
One former St. Petersburg community college employee will take home $266,567 this year. That includes a $26,000 benefit increase over the past four years, according to data supplied by the Florida Department of Management Services.
An ex-Florida State University employee is pulling $233,037, and a retired Broward County sheriff’s department worker will make $219,723 —a $46,000 increase since retiring in 2005.
Most of the six-figure pensioners worked in education, law enforcement, county government or the legal system.
Some think it’s too much.
“This is all taxpayer money and I don’t think it should be allowed,” Greg Kennett, a Tallahassee mechanic told Watchdog.org.
Kennett said he doesn’t have access to a defined benefit retirement plan.
Reform advocates have long pushed to bring the state system more in line with the private sector.
“The FRS currently has 84 percent of its members enrolled in the DB (defined benefit) Pension Plan, while nearly the opposite statistic is seen in the private sector,” Florida Tax Watch, a Tallahassee-based fiscal watchdog, wrote in a report called “Modernizing the FRS.”
Fairness aside, the FRS — the fifth-largest state pension system in the country — is $18 billion to $20 billion underfunded. Compared to other states, it’s considered on solid fiscal ground.
Even so, questions about fiscal sustainability persist. In recent years, the Florida Legislature allocated $500 million dollars from the state general revenue fund to cover the funding gap.
According to former House Speaker Will Weatherford, R-Wesley Chapel, diverting state tax revenue is the way of the future.
“This session, we will spend $500 million of general revenue just to shore up our pension fund,” he said in 2013. “That’s above and beyond what we contribute to state employees’ retirement, and it’s just the down payment. We’re going to have to keep writing that check of a half a billion dollars for the next 28 years to keep our so-called ‘great pension system’ afloat.”
Truth in Accounting, a nonpartisan research group, found 90 percent of Florida’s retirement liabilities aren’t clearly disclosed in the state budget.
“Since employee retirement benefits are not immediately payable in cash, the related compensation costs have been ignored when calculating balanced budgets,” an analysis reads.
It’s recommendation: reform. Or future taxpayers will continue to be burdened with paying for benefits without receiving corresponding government services.
That suits Kennett just fine.
“We just voted on several constitutional amendments, why shouldn’t we get to vote on this?,” said Kennett.