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CITY OF FORT LAUDERDALE 

POLICE AND FIREFIGHTERS’   RETIREMENT SYSTEM 

FLORIDA PENSION NEWS STORIES ON POLICE AND FIREFIGHTERS
Prepared by Fred Nesbitt, Director of Public Information fnesbitt911@gmail.com October 31, 2009

There have been two great articles questioning the validity of 401(k) plans: Why It's Time to Retire the 401(k)
By Stephen Gandel, Time/CNN, October 9, 2009 The ugly truth, though, is that the 401(k) is a lousy idea, a financial flop, a rotten repository for our retirement reserves. In the past two years, that has become all too clear. From the end of 2007 to the end of March 2009, the average 401(k) balance fell 31%, according to Fidelity. The accounts have rebounded, along with the rest of the market, but that's little help for those who retired — or were forced to — during the recession. In a system in which one year's gains build on the next, the disaster of 2008 will dent retirement savings long after the recession ends.

Retirement overhaul: 401(k)s may not be the answer now
By Christine Dugas, USA TODAY, October 23, 2009 The 401(k) is clearly the center of the retirement storm. Some consumer advocates say the 401(k) is a failure that should end. Others, especially financial industry representatives, think 401(k) plans are still the best retirement option and they simply need shoring up. Retirement USA wants to keep the best parts of the current system and add to it. Many workers — especially women, Hispanics and African Americans — don't contribute to a 401(k) plan at all. Women also face an obstacle men do not. They need to replace more of their final pay for retirement — 2% more than the average male — because they live longer.

Forum Hears About Police and Firefighter Pensions
At a September meeting of the Fort Lauderdale Forum, the topic was, “Fort Lauderdale’s Police and Fire Pension Plan: Is There a Better Way.” “Police and Fire pensions are a major cost to the City, but are a vital part on our competitiveness in hiring and retaining public safety professionals. Can we find a better way to do this?” was the theme of the discussion. The website has a video of the panel discussion.

Did Merrill Lynch break a promise?
By Robert Trigaux, St. Petersburg Times, October 27, 2009 Did Merrill Lynch engage in Me First financial advising at the expense of Florida pension fund clients? Earlier this month, the pension fund maintained by the City of Largo for its retired and disabled police officers and firefighters sued Merrill and Callaway. And last week, another pension fund for St. Petersburg's retired and disabled firefighters also sued, making similar arguments.

Options on Jacksonville pension mess: tax hike or cut in benefits
By Ron Littlepage, Florida Times-Union, October 22, 2009 The city's pension plans - especially the interest payments on the unfunded liability - is "what's eating the city's lunch," according to John Keane. Keane is the executive director of the Jacksonville Police and Fire Pension Fund, which accounted for about $789 million in unfunded liability after the stock market went south. Keane blames that huge shortfall on the city's habit of rolling back the millage rate year after year instead of properly funding the city's three pension plans.

Growth Fund seeking tech firm investments
By Bill Frogameni, Orlando Business Journal, October 13, 2009 Central Florida technology firms expect a boost from a $250 million state investment fund designed to spur innovation. The Florida Growth Fund, an arm of the state’s pension fund, will open offices in Orlando and Fort Lauderdale to invest in companies statewide. State lawmakers created the fund last year to invest in private firms with a significant presence in Florida.

Investment firms pay to play with state retirement funds
By Sydney P. Freedberg and Connie Humburg, St. Petersburg Times, October 11, 2009 On June 23, Florida Attorney General Bill McCollum pulled in a bundle of campaign checks from a single address in Pittsburgh. In all, $28,000 in checks from that address made their way to McCollum's campaign for governor. It's business as usual at the SBA, which has a ton of public money to invest — about $132 billion — on behalf of hundreds of Florida cities, counties and state organizations, and on behalf of the pension fund for a million current and retired teachers, police officers and other public servants.

City pensions: Tough choices
Florida Times-Union, October 23, 2009 Like a slow moving tidal wave, the city of Jacksonville's pension obligations threaten to swamp future city budgets, as well as Jacksonville's reputation for having progressive government. Here are logical improvements: End the cushy defined benefit plans for new employees. They are too easy to "game," putting the bills on future generations. Use defined contribution programs, like 401(k) types, instead. Cut back the deferred retirement program, called DROP, which has turned into another windfall for city employees with its 8.4 percent guaranteed return. Push back the date that retirement benefits can be collected closer to age 65. The bottom line: Pension benefits of government workers should not be so much greater than all the constituents they serve. It's unreasonable in this day and age to be receiving retirement benefits decades before you reach normal retirement age.

The Herald recommends
Editorial, Miami Herald, October 24, 2009 With Miami facing a financial crisis as overly generous city workers' pensions threaten to bust the budget, voters want more attention to basic city services in a high-poverty city where economic development remains a critical challenge. Maria ``Beba'' Sardiña Mann’s top priority is stabilizing city finances by reducing too-high salaries and escalating pension debt. A former city attorney, Mr. Rodriguez-Fonts proposes to overhaul the pension system that contributed to the city's $118 million budget hole. Jeff Torain proposes renegotiating the city's untenable pension fund obligations. [The Herald endorsed these three candidates.]

Pension solution will be expensive
By Jim Brown, Sarasota Herald Tribune, October 13, 2009 Longboat Key town commissioners meet Thursday in the first of two special workshops designed to see how they can work their way out of their $26 million pension dilemma. Longboat's employees, St. Denis said, actually have one of the highest contribution levels in the state. Sarasota County firefighters, for example, are covered by the state system; they contribute nothing and get a 3 percent multiplier in determining their pension payout. Longboat's, on the other hand, contribute 10 percent and get a 3.5 percent multiplier. Critics say that most businesses across the country have gone to a "defined contribution" system. Much like a 401(k) plan, a specific contribution is made and employees can invest it as they will.

We need to examine county employee benefits
Editorial, St. Augustine Historic City News, October 31, 2009 Let me ask you a question. Do you think it is fair that taxpayers have to work into their 70’s so that their civil servants can retire in their 40’s? Do you think government workers deserve a better pension plan than the taxpayers who pay their salaries? The real problem is the hidden fact that Florida’s pension plan is not actuarially sound or self funding. The fund lost $31.1 billion last year, or 25% of its value. The taxpayer is liable for the fund making a 7.75% return each and every year, so the gap in value is now $40 billion and we, as taxpayers, have to pay again. Instead of a “defined benefit” system, what about a “defined contribution” system; where we put the retirement funds into the employees 401k account like the private sector does?

Police union officials rip Tampa mayor's spending priorities
By Janet Zink, St. Petersburg Times, October 29, 2009 Conceding to the police union's demands would cost Tampa more than $12.6 million and force nearly 200 layoffs, Mayor Pam Iorio said Wednesday. But union representatives said Iorio is overstating the financial impact of the proposed contract by inflating dollar figures and applying police union contract requests to the city's firefighter and general employees unions. William Mann, vice president of the firefighters union, said Iorio has made choices about how to spend city money that indicate she doesn't really care about employees. Specifically, he notes $12,000 budgeted to pay a poet laureate and money earmarked for lighting street signs.

Miami Beach Mayor Matti Bower faces criticism, accusations from opponents
By David Smiley, Miami Herald October 23, 2009 Levey also said Mayor Matti Bower has been unwilling to take a lead in slashing an unfunded employee pension liability that city officials say could balloon and cripple Miami Beach's finances in the near future. ``Matti is not paying attention to the unfunded pension,'' Levey said. ``She doesn't want to get in bad with the unions because they are supporting her.'' The Florida International University graduate says her first priorities would be to address the unfunded pension liability, cut the city's payroll and further promote the city's convention center and tourism abroad.

Police reform: A bold, flawed idea
Editorial, Florida Times-Union, October 23, 2009 Credit Michael Hallett for straight talk without the whitewash. The University of North Florida criminologist says the city's rising police pensions put the city on a direct path to financial disaster.

The Herald recommends Julio Robaina for Hialeah mayor
Editorial, Miami Herald, October 22, 2009 Hialeah has managed to avoid the problem of skyrocketing pension obligations because its system is run by the state of Florida, keeping costs in check. This allows the mayor to boast of a balanced budget without the need to increase taxes or resort to layoffs or dramatic service cutbacks. He says public safety remains one of his top priorities.

Bus stops, union 'pool time,' other thoughts for City Hall
By Phil Fretz, Florida Times-Union, October 26, 2009 Stop paying the salaries of the police and fire union presidents. Their job is to represent the interests of union members, often at the expense of taxpayers. Their pay should come from the rank-and-file. Combined, the police and fire unions get 14,800 hours of "pool time," The Times-Union has reported. That means their members get paid by taxpayers to spend a lot of time doing union work, instead of their actual jobs, at a time when they say they need more help. The city has proposed cutbacks. Follow through with bulldog-like determination.