Statement by Scott Dudley Legislative Director, Florida League of Cities Regarding LeRoy Collins Institute “Years in the Making” Pension Report
Contact: Jenna Titcomb
Statement by Scott Dudley
Legislative Director, Florida League of Cities
Regarding LeRoy Collins Institute “Years in the Making” Pension Report
“The ‘Years in the Making’ provides an informative short-term snapshot of local government, primarily municipal or city, defined benefit pension plans. Many of these pension plans have been operating for 50 or more years, and the accepted standards applied to evaluate the plans are appropriately long-term in nature. While a review based on information covering a 7-year period is informative, as the report notes, these plans typically use investment and retirement horizons of 20-30 years and historical reviews with similar time frames. Therefore, before any particular city’s pension plan is determined to have a ‘structural weakness,’ the plan’s health should be determined using the appropriate standards.
“The report clearly identifies a troubling trend with the annual pension contributions required to fund public safety (police officer and firefighter) pension plans. As a percentage of payroll, city contributions to these plans have almost doubled in 7 years, from approximately 15 percent to 30 percent of payroll. Unfortunately, this significant increase in cost to cities is in large part based on state laws adopted by the Florida Legislature in 1999. These state laws require cities to maintain and increase pension benefits for police officers and firefighters or risk losing monies to help pay for the plans.
“In attempts to control expenditures, cities over the last several years have typically reduced pension benefits for general employees, but due to these state laws cities have been much less successful in reducing pension benefits for police officers and firefighters. A state legislative priority for the Florida League of Cities is to remove these state law restrictions, and allow cities the needed flexibility to responsibly address pension expenses for all city employees.”
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ABOUT THE FLORIDA LEAGUE OF CITIES: Founded in 1922 on the belief that local self-government is the keystone of American democracy, the Florida League of Cities is the united voice for the state’s municipal governments, representing more than 400 cities, towns and villages in the Sunshine State. For more information, visit www.FloridaLeagueOfCities.com.