Jax Archives - Page 4 of 340 - Florida Politics

Al Lawson addresses Jacksonville City Council

U.S. Rep. Al Lawson made some time Tuesday evening for the Jacksonville City Council, attending their regular meeting.

Lawson, from Tallahassee, has had an interesting time navigating Jacksonville’s political world since he began his race to unseat local Corrine Brown last year.

With questions and concerns about how engaged Lawson is with Jacksonville issues, and the very real chance of a challenge looming in 2018 from Duval, this was one of those addresses that may have been more important than it seemed as just a line on the agenda.

Lawson described his experience in Washington as “extraordinary,” noting that he “came to Washington to break partisan activities.”

The congressman said he had made a “lot of appropriations request,” noting that Jacksonville had serious infrastructural needs.

He also outlined another priority: helping people with “problems with student loans.”

Lawson also described his trip to Eureka Garden with HUD Sec. Ben Carson, saying that the pediatric neurosurgeon was “hitting the ground rolling.”

Among other priorities: “working to secure funds for JaxPort.”

Lawson cited relationships with former legislative titans from Jacksonville, such as Jim King and John Thrasher, with keeping him informed.

And he also lauded the Jacksonville City Council for the “great work y’all’ve done on the pension issue.”

Finally, Lawson noted that, despite President Donald Trump signaling an interest in cutting Community Development Block Grants, colleagues “on the other side of the aisle” will resist such moves.

Lawson’s words aren’t going to make locals forget Rep. Corrine Brown.

But in terms of building a bridge to Jacksonville, they are a start.

Florida Division of Retirement gives green light to Lenny Curry pension reform

An important milestone for proposed pension reforms by Jacksonville Mayor Lenny Curry was given the green light by the state of Florida this week.

State retirement system actuarial experts signed off on the reform package, saying that the financials are clear and consistent with law, for all three plans: General Employees, Corrections, and Police and Fire

The letters sent from the Florida Division of Retirement to the city of Jacksonville validate the pension reform, including the use of present value calculations — a key component of the Curry plan.

“A share of the present value as of 10/1/2016 of the total projected proceeds of the sales surtax is amortized over 30 years and applied as a credit to the annual required contribution,” reads the letter from Douglas Beckendorf, plan actuary.

Beckendorf discussed payroll growth assumptions also, and is on board with Curry’s projections of growth to 1.5 percent per annum, writing that “the methods and assumptions used to calculate the annual required contribution” from the city jibe with statute.

Beckendorf offered no opinion on the “reasonableness of the estimates of the financial status of the plan,” however, as the review was limited to financial impact statements.

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This was a timely communique, with the Jacksonville City Council weighing pension reform, via

2017-257 creates a new ordinance section:  Chapter 776 (Pension Liability Surtax).

Bill 2017-258 affects the general employees and correctional worker plans, closing the extant defined benefit plans to those hired after Oct. 1, 2017, and committing the city to a 12 percent contribution for those general employees and a 25 percent contribution for correctional officers hired after October.

Bill 2017-259 implements revisions to the Police and Fire & Rescue plans.

258 and 259 both offer fixed costs via a defined contribution plan for new hires, while offering 25 percent contributions from the city to those hires.

As well, there will be raises across the board: 20 percent over the next three years for all current police, fire, and corrections employees, and 14 percent for general employees.

Jax Sheriff: Gary Snow a ‘catalyst’ of Hemming Park protest melee

A Jacksonville protest against military action in Syria went ugly Friday evening; many protesters were arrested, with one getting medical treatment.

Meanwhile, counter-protester Gary Snow, a fixture for almost a year at left-leaning Jacksonville protests, as well as political events on the right, escaped without charges.

However, Jacksonville Sheriff Mike Williams told us Tuesday that Snow, in fact, was a “catalyst” of the melee in Hemming Park between protesters and police — and that the JSO is reviewing video of the event along with its procedures.

“That event Friday — he clearly was a catalyst” for the violence that occurred, Williams said.

“We had dozens and dozens of protests in Jacksonville, peacefully. We’ve got a great working relationship with the Progressive Coalition and many other groups in that protest.”

When asked about the “incite to riot” charges against some of the protesters on the other side, who had been baited by Snow, as well as at Florida Statute prohibiting interruption of lawful assembly, Williams noted that the ultimate fate of those charges — and potentially others — rest on documentary evidence.

“We have about 15 videos right now, and we’re going to look at every aspect of that,” Williams said. “Including ‘is there anyone who did not get charged who should be charged,’ so we’re going to look at that and see, in addition to looking at operational fixes for us.”

“Obviously, we got multiple complaints about uses of force. Those complaints go to Internal [Affairs] with those videos, and we’ll take another look at that. But before we finish, there will be another protest in Jacksonville,” Williams said, necessitating “immediate fixes” along with process review, both internally and in collaboration with the State Attorney’s Office.

“For this one to go the way that it did, there’s no excuse for it. We’ve all got to do a better job of taking a step back and do the right things. And we’re going to do that too — going to look at how we handle protests,” Williams added.

“It’s a new dynamic for us.”

Some allege, without proof, collaboration or friendship between Snow and officers.

That’s news to the Sheriff.

“None that I know of,” Williams said. “I don’t think — I haven’t heard Gary Snow’s name until Saturday. I don’t think he has any real connection to police officers.”

“He does come to communities like he did in Chicago and try to befriend, try to do that type of thing,” he added.

Ben Carson, Marco Rubio, Al Lawson talk HUD reform in Jacksonville

Jacksonville’s Eureka Garden apartment complex has been in the news for a number of years.

First came the crime reports. Then came reports about mold, broken windows, gas leaks, and other infrastructural nightmares for the 400-unit HUD complex on Jacksonville’s Westside.

Jacksonville Mayor Lenny Curry and U.S. Sen. Marco Rubio called for reforms to the HUD process, and for new ownership.

And right now, the ownership transition is underway.

Millennia Housing Management took over the management of the complex from the still-current owners, Global Ministries Foundation.

MHM is ready to put capital in; however, until formal transfer of the GMF portfolio concludes, there’s only so much they will invest.

And therein lies an issue for the long-suffering Eureka Garden residents.

U.S. Rep. Al Lawson has made Eureka a focus, discussing issues at the complex during his 2016 campaign, and visiting the apartments during his last Congressional recess.

Tuesday saw Lawson double down — accompanied by another newcomer to Washington, D.C., in HUD Secretary Ben Carson and Sen. Rubio.

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At a church near Eureka Garden, the politicians sat down with Jacksonville City Councilmen and other local stakeholders, as Secretary Carson discussed his plans for reform.

Before doing that, he lauded local officials for demonstrating the “leadership” that has brought the issues at Eureka into the “spotlight.”

Carson described a holistic vision of reform, one which went beyond subsidized housing.

The Secretary advocated for community clinics, “so the Emergency Room doesn’t become the primary care vehicle.”

He also advocated the importance of education, making the case for vouchers, and for more changes to the Section 8 model.

Among those proposals: a “housing savings account,” which would allow residents to save a bit of money every month, either to defray the cost of repairs (“doors scratched up” and other such issues).

“If those things aren’t happening,” Carson said, money “starts to accumulate,” and after a number of years, there may be sufficient money for a down payment on a house.

Carson, after musing on problems with America’s multi-party system, and people outside the country watching to see if they should “destroy [Americans] or wait for them to destroy themselves, noted that there’s “a lot of hysteria about people going to be thrown out onto the street.”

Carson says that won’t happen; however, America’s ponderous national debt requires a focus on using money efficiently and effectively, with an eye toward getting the greatest “bang for the buck.”

Part of that strategy: public-private partnerships, with “federal money leveraged with the private sector.”

President Donald Trump wants a $1T investment in infrastructure; much of that, Carson said, will go to housing.

Carson also wants “vision centers” near HUD complexes, which will be “places where young people can learn about careers.”

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Rep. Lawson told us about how he made the visit happen, writing Secretary Carson in February.

“I told him he really needed to come to Eureka Garden,” Lawson said.

Lawson sees the changes at Eureka — which look to be complete in the next couple of years, pending the transfer of the property — as a model for the rest of the country, potentially.

While Rep. Lawson isn’t completely sold on concepts like housing savings accounts, saying they might have more utility for younger people rather than older residents, he appreciates Sec. Carson’s interest, and anticipates a strong working relationship while both are in Washington.

Keith Perry, Audrey Gibson pace northeast Florida fundraising in March

March offered northeast Florida’s state legislators a window to fundraise before the Legislative Session kicked off.

Some took advantage of it, such as state Sen. Aaron Bean, who brought in $11,000 via $500 and $1,000 checks on Mar. 6.

The Fernandina Beach Republican spent over $7,000 in March, including over $1,000 with Wal-Mart, and $1,497 with Annett Bus Lines of Sebring.

Bean has just over $23,000 on hand.

Bean’s Democratic colleague from Jacksonville, Audrey Gibson, had an even stronger performance, with a $20,750 March.

Gibson, like Bean, collected big checks from a diverse group of stakeholders ranging from the South Florida Greyhound Association to TECO Energy.

Gibson, who is not spending much of her money (a contrast to Bean), has $49,000 on hand.

The best campaign account performance for a northeast Florida Senator?

Gainesville Republican Keith Perry, the rare Republican from these parts in a competitive district, brought in $29,900 of new money in March – after a $68,000 February.

From CARPAC to FAIAPAC, and from Gray Robinson to Greenburg Traurig, the money came through yet again for Perry, who has over $102,000 on hand.

Meanwhile, Sen. Rob Bradley had an impressive March, in terms of fundraising for his “Working for Florida’s Families” committee.

The Clay County Republican’s committee hauled in $47,000 in March, pushing total cash on hand to $390,000.

Among the donors: Tenet Health, Altria (the tobacco company), and the GEO Group (a leader in the always booming prison industry).

All Northeast Florida Senators worked the donors in the first week of March.

Most state Representatives followed suit.

Jacksonville Beach Republican Cord Byrd of HD 11, who wasn’t necessarily the most robust fundraiser of the Republican candidates for the seat in 2016, made up for lost time as March began.

Byrd brought in $15,250 of new March money, with money from local stakeholders (Loop’s Nursery and Rayonier) folding in neatly next to contributions from Florida Crystals and the evocatively named “Texican Land Company” of Dallas.

Byrd spent $5,000 in March with TWG Technologies.

All told, he has just over $20,000 on hand – though, as is the case with every Northeast Florida State Legislator, he won’t face a competitive race for years to come.

HD 12 Republican Clay Yarborough brought in just over $5,000 in March – the second straight month in that range.

The most interesting of Yarborough’s donors: the “American People Political Committee,” which derives most of its donations from the greyhound racing industry, with parties such as the Florida Greyhound Association, the Southern Florida Greyhound Association, and a Texas company (Peck’s Training Kennels) betting on the Jacksonville Republican.

HD 13 Democrat Tracie Davis, in her first month of fundraising as an incumbent, hauled in $11,440 in March – a number inflated by $5,440 of her own money.

Among her donors: the Fiorentino Group and Toney Sleiman.

HD 14 Democrat Kim Daniels and HD 15 Republican Jay Fant have yet to file for re-election.

Daniels is definitely in, said someone in her office. Fant is a big question mark – with rumors percolating that he’s looking at the 2018 Attorney General race.

To that end, he had a fundraiser for his political committee – “Pledge This Day” – in March. And Jacksonville donors of the Ed Burr and John Delaney type came through, giving Fant’s committee a $45,850 March that brings the committee up to $80,000 cash on hand.

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HD 16 Republican Jason Fischer brought in $9,900 of new money in March – bringing his total cash on hand near the $22,000 mark.

Fischer brought in donations from the aforementioned Texican Land Company, Florida Blue, Florida Crystals, and Surterra – one of the leaders in Florida’s medical cannabis distribution space.

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Down in St. Johns County, HD 17 Republican Cyndi Stevenson brought in $13,532 in March – pushing her cash on hand over $32,000.

Over in Clay County, another robust month of fundraising ($16,600 in March) brought HD 18 Republican Travis Cummings over $56,000 on hand.

And down in Putnam County, HD 19 Republican freshman Bobby Payne was the only person on this list not to take advantage of March for significant fundraising, adding a mere $1,600 to his campaign account; Payne has $16,546 on hand.

Jax City Council auditor’s office raises pension questions

The Jacksonville City Council is currently mulling a raft of bills that could change the way the city handles pensions forever.

2017-257 creates a new ordinance section:  Chapter 776 (Pension Liability Surtax).

Bill 2017-258 affects the general employees and correctional worker plans, closing the extant defined benefit plans to those hired after Oct. 1, 2017, and committing the city to a 12 percent contribution for those general employees and a 25 percent contribution for correctional officers hired after October.

Bill 2017-259 implements revisions to the Police and Fire & Rescue plans.

258 and 259 both offer fixed costs via a defined contribution plan for new hires, while offering generous contributions from the city to those hires, and raises for all current employees.

The council spent Thursday afternoon being walked through the legislation by Jacksonville Mayor Lenny Curry and his team.

However, questions still loom.

And with the council prepared to discuss the bills further this week, here’s a look at the questions the auditor’s office has … thus far.

Questions include an explanation of how employees in defined contribution plans will not be eligible for Social Security. Also desired: an actuarial analysis of plan health at different sales tax growth rates — notable, as the Police and Fire Pension Fund posited that sales tax growth would be around 3.34 percent per annum.

Another question worth noting: the cost of plan administration.

2017-258legislation which affects corrections and general employees, likewise came in for scrutiny. As did 2017-259, which affects plans for police and fire employees.

The auditor wonders about changes to DROP language, and questions calculations of the average annual growth rates, while wondering why the contract negotiations re-opener for Corrections is tied to the Police and Fire Pension Fund.

“If this bill is to pass, do employees who are currently in the DC immediately begin receiving a 12% contribution from the City for the remainder of FY 2016/17,” the auditor’s office wonders.

A complete list of questions — ones which certainly will be mulled over in a looming Wednesday afternoon council workshop — follows here.

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Handout Provided on 4/6/17

  • Page 20 – How would the baseline go to $0 in FY 47-49?

General Questions

  • Anything recognized on financial statements related to pension liability sales tax? Consulted with CRI?
  • Will chapter fund use be legal? If so, explain.
  • Employees on DC will not be eligible for SS, correct? Please provide basis for how they will still be exempt.
  • Please provide other analyses run by the actuaries at other Sales Tax growth rates (e.g. 3.2% and 3.75%)?
  • On the PFPF Payment Forecast (page 20 of presentation), how does the Baseline payment ever arrive at $0?
  • In relation to page 4 of the presentation, what is the basis for these amounts? Please indicate which years fall into which category.
    • Actuals?
    • Budget?
    • Actuarial Report?
  • Financial Impact Statements – How are the “Reduction due to amortized value of discounted value of allocated surtax revenue” amounts calculated that are included in GERP and CORP financial impact statements?
  • What is the estimated cost of the administration of the DC plans? How will it be funded?

 

 

2017-257

  • Page 1, lines 5-9 – There is not a corresponding section in the bill levying the ½ cent sales surtax. Is the Ordinance Code language sufficient or are sections needed? The same is true for the collection, administration, etc. and establishing the start date.
  • Page 4, line 30 – How this is worded makes it seems like a change in October 2017 would impact FY 2017/18. Wouldn’t that amount impact FY 2018/19 instead?
  • Page 5, line 14 – How many years do you recognize this over (e.g. 30 years)?
  • Page 5, line 20 – This section heading is the same as 776.104. Is that intended?

2017-258

  • Page 13, line 13 – The phase 2 of DROP reads differently in the ordinance than what is included in the tentative agreement and needs added language about tying length to mortality tables. Is this is a new benefit?
    • If new, please provide an impact statement and explain how it is allowed to add this benefit.
  • Page 14, line 3 – How will the average annual growth rate be calculated?
  • Page 14, line 15 – Shouldn’t “average annual growth” be “average annual gross return” according to the manual changes in the tentative agreements?
  • Page 14, line 15 – Why is the re-opener for the Corrections Plan tied to the growth rate of the PFPF?
  • Page 14, line 15-19 – Does this make sense? I think there is an issue with the wording.
  • Page 15, line 16 – If this bill is to pass, do employees who are currently in the DC immediately begin receiving a 12% contribution from the City for the remainder of FY 2016/17?
  • Page 16, line 14-17 – Does this election have to occur prior to retirement? How is the switch calculated?
    • Will it be dictated by 120.508A?
  • Page 17, line 17-19 – What does this mean?
  • Page 18, line 18 – Should this mention a time period such as 90 days?
  • Page 20, line 14 – Need to add something here about COLA starting five years after commencement of survivorship benefits. Also, when would this happen (i.e. current delay method)?
  • Page 21, line 28 – Why is the Board referenced here?
  • Page 22, line 2 – Is there no minimum length for a spousal marriage?
  • Page 23, line 22 – Why is there a reference to 120.207 (a)? This is not handled this way for the survivorship benefits for a deceased active employee. Should this go somewhere else? If so, would the same reference need to be for survivorship benefits for a deceased active employee?
  • Page 25, line 6 – The reference as presented is to the GERP DB plan language and not CORP. Is that intentional?
  • Page 27, lines 17-19 – Why are those the periods selected?
  • Page 27, line 27 – The tentative agreements seem to indicate that other groups (unmarried orphaned children and disabled children) besides surviving spouse will also receive a COLA in the event of the death of an active employee. This language is not in the bill.
  • Page 29, line 4 ½ – Was (g) intentionally left out?
  • Page 29, line 8 – Is there no minimum length for a spousal marriage?
  • Page 29, line 16 – Why is subsection (k) almost a direct repeat of subsection (f)? Is this intended to address something else?
  • Page 31, line 10 – The reference as presented is to the GERP DB plan language and not PFPF. Is that intentional?
  • Page 34, line 8 – So each January 1, even if effective on December 31?
  • Page 34, line 18 – So each January 1, even if effective on December 31?
  • Page 34, line 27 – So each January 1, even if effective on December 31?
  • Page 35, line 10 ½ – Was (g) intentionally left out?
  • Page 35, line 22 – Why is subsection (k) almost a direct repeat of subsection (f)? Is this intended to address something else?
  • Page 36, line 16 – So each January 1, even if effective on December 31?
  • Overall – How will the survivor’s benefit of an active employee be funded? Same for disability benefits.
  • Overall – What are the current balances of the various accounts – UALPA, SPA, CBSA, and EBA to get to the $90 million referenced in the presentation?
  • Overall need to update all references to Part 5 of Chapter 120 to Part 5A?

2017-259

  • Page 4, line 28-31 – Does this make sense? I think there is an issue with the wording.
  • Page 17, line 11 – What is the Supplemental Payment Account?
  • Page 18, line 9 – Who is the City (i.e. who makes the decision)?
  • Page 22 – Will the Share Plan get any additional contributions after 9/30/17? If so, how? Just re-distribution?

 

Springfield Overlay zoning change legislation draws scrutiny in public notice meeting

What happens when the Americans for Disabilities Act meets a Jacksonville zoning overlay? A headache, some litigation, and, eventually, attempts by all parties to arrive at a workable compromise.

Emphasis on the word “attempts,” as seemingly everyone outside of the lawyers who reached the compromise found something at which to balk.

A bill that would impose terms of a settlement requiring the breach of the Springfield Overlay to accommodate an apartment building housing the disabled and the chronically homeless has loomed on the Jacksonville City Council agenda for some time.

To recap: in 2014, Ability Housing set out to renovate an apartment building in Springfield to create 12 units of housing for the chronically homeless and disabled.

The planning director balked, likening the proposed use to that of an assisted living facility. Soon thereafter, the Department of Justice, Disability Florida, and Ability Housing sued. And settlement legislation followed.

2017-36, filed in January, would privilege federal civil rights over local zoning exceptions, allowing the goal of reasonable accommodations to take precedence over planned unit developments and other rules restricting the development of group living and assisted living facilities.

However, there is a long way to go for this legislation, with proposed zoning code changes and language nettling virtually everyone in the room outside of the Office of General Counsel and Ability Housing, one of the parties attempting to settle with the city.

LUZ Chair Danny Becton wanted all parties on the same page regarding zoning changes, including the city, Ability Housing, and Springfield activists.

City lawyer Jason Teal noted that the inclusion of these changes in code is intended to comply with the Americans with Disabilities Act after the city “made a mistake” in disallowing the development during the Alvin Brown administration.

“The goal is to try to do what the law requires,” said Teal, “and really no more.”

However, what the federal law required was a matter of spirited debate for three hours Monday.

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Among the changes proposed by the Office of General Counsel were a discussion of requests for reasonable accommodation via administrative deviation to offer “equal opportunity to enjoy housing,” as dictated in the Fair Housing Act.

Christina Parrish of Springfield SPAR cautioned that these changes could affect the entire zoning code.

Lobbyist Paul Harden, advocating for Springfield residents, chimed in that the language “spins administrative deviations to say that … anywhere in the city, you can change the use in a single-family subdivision to be a group home or a treatment facility” via reasonable accommodation.

Council President Lori Boyer noted that these changes substantially expand the zoning administrator’s ability to make changes in terms of permissible use.

Council VP John Crescimbeni likewise objected to the broadness and the perceived malleability of the ordinance; Teal pointed out that the issue is one of reasonable accommodations for disability.

As well, the federal Department of Justice believed this should be resolved via code, rather than policy, when Jacksonville’s OGC contacted them.

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Discussion then moved to the concept of reasonable accommodation, defined in the ordinance as not fundamentally altering the zoning code.

Councilman Becton noted that, as LUZ chair, he “never hear[s] that in a negative way.”

Parrish cautioned that the language was too broad, putting too much authority in the hands of a single zoning administrator.

“This is gobbledy-gook that the planning department loves,” Crescimbeni said. “It’s way too broad.”

Despite objections from the lawyer from Ability Housing, Harden continued to eviscerate the appropriateness of the language, saying that it provided an opportunity for a single person to sidestep for code.

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Semantic discussions continued.

Harden noted that “disability” is defined in federal code, and that there would need to be independent confirmation by a professional in order to satisfy threshold.

“The federal law doesn’t say they get to do away with the zoning code,” Harden stressed.

“Can you discriminate against a disabled person? The answer is no,” said Tom Ingram, on behalf of Ability Housing.

Becton, meanwhile, wondered about the probity of “duplicating federal code.”

Teal said that, while the law is proscriptive, it doesn’t say “what our process in Jacksonville” would be, and that the Department of Justice recommended that a process be developed.

Crescimbeni noted, meanwhile, that the bill was written by two lawyers — and that if they wanted to write legislation, they should run for council.

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A measure of the contentious nature of the discussion: questions from former City Council President Alberta Hipps that there are “subjective” calls made in striking language from the original Springfield Overlay legislation of 2000.

Back then, rooming houses, group care, and automotive uses were itemized as being present in a “disproportionately large number.”

The new legislation just itemizes rooming houses.

While attorney Teal noted that there were changes in Springfield over the last 17 years, there was concern over empirical proof for his findings, with Paul Harden advising a look to ensure “the facts are still the facts.”

“This is an attempt to justify the settlement of that lawsuit,” Harden said.

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 The proposed legislation would also define a “community residential home” as discrete from a “rooming house.”

This led to grumbling and then, unavoidably, a review of language in statute.

Harden noted that these homes are not for just kids with disabilities, but also troubled kids and so on.

Al Lawson to address Jacksonville City Council Tuesday

Rep. Al Lawson will spend some of this week in Jacksonville, with plans to speak at the Tuesday evening meeting of the City Council.

The meeting, which begins at 5:00 p.m., will offer the Tallahassee Democrat his first opportunity to address Jacksonville’s 19 legislators.

Lawson, replacing Rep. Corrine Brown (who was noted for her ability to “deliver” for the district), faces challenges in terms of understanding the needs of the biggest city in his district — and one where he got roughly 20 percent of the vote in last August’s Democratic primary.

As there has been a persistent drumbeat of expectations that Lawson will receive a local challenger in the Democratic primary, it follows that this — and other events Lawson has in Jacksonville this week — will likely solidify the decision-making of expected challengers.

Lawson, who had some schedule issues during his last visit to Jacksonville, will be in the position of making up for lost time with this visit — which promises a robust Wednesday itinerary that includes a talk to the Duval Democratic Women’s Information Network, a visit to a local Job Corps, and a town hall meeting at Florida State College Jacksonville.

Jax PFPF questions payroll growth assumptions in city pension plan

Prologue: A Monday meeting of the Jacksonville Police and Fire Pension Fund centered around the ultimate actuarial impact of Lenny Curry‘s pension reform package, with presented actuarial analysis from the board proving to be more pessimistic than that of the city about rates of tax revenue growth, payroll growth, and amortization schedule.

Ultimately, not much of that mattered in the trustees’ decision making.

The Jacksonville City Council currently is considering legislation that would close the current defined benefit plans to all new hires, open up defined contribution plans for new hires, and pay off the city’s $2.8B unfunded pension liability with a sales tax extension starting in 2031.

The unfunded liability will be re-amortized, with a longer payment term and higher overall costs on the pre-2017 pension debt, which would be paid off in full by approximately 2051, asserts the city.

While the PFPF doesn’t get to approve the deal, they do get to weigh in via an impact statement.

The PFPF trustees were encouraged by the city to use the city’s anticipated rates of growth for tax proceeds (4.25 percent per annum) and payroll growth rate (1.5 percent).

Yet the board’s actuarial projections (3.34 percent for tax, and 1.25 percent for payroll) are less optimistic — by far.

In a meeting that sprawled over four hours, PFPF actuaries threw some cold water on the mayor’s push toward pension reformsuggesting that the city of Jacksonville’s assumptions could put the underfunded police and fire pension fund in danger of not meeting liquidity targets, and that more conservative benchmarks are recommended to protect the fund in the decades to come.

The crux of the fund’s decision, however, was simple: to accept the city’s 1.5 percent payroll growth rate, or the more conservative 1.25 percent that plan actuaries believe is appropriate.

The 1.25 percent was accepted. Along with the 4.25 percent expected growth in anticipated tax revenue increase annually, which was the city’s projection — one that was less conservative than that by the pension fund’s own actuary.

Also accepted: the 30-year amortization agreement of the deal.

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Board attorney urges skepticism on Curry plan: Fund attorney Bob Sugarman noted that state law required the trustees to offer an actuarial impact statement to the city council.

“They’re not bound by it,” Sugarman noted, adding that the Board of Trustees would offer comment on the ordinance at a later point, as part of a “two-step procedure.”

As well, committee members should not be “guided by the impact on the city … the unions … collective bargaining agreement.”

Focal points of board analysis: the amortization schedule; rate of payroll growth; growth of surtax revenue.

On all of these issues, Sugarman posited that the city and the fund would have different interpretations of efficacy.

On surtax revenue, Sugarman posited the PFPF can define that, based on independent actuarial opinion.

“The law doesn’t say who values the surtax. I believe it’s the board,” Sugarman noted.

And Sugarman added that the city has an “irreconcilable conflict” in setting this up, and, moreover, there are conflicts with statute in doing so — a move he framed as a way of shirking contribution burden.

With all that said, there was some wiggle room for those on hand.

“Are you protected by relying on the opinion of the General Counsel’s office? The answer is yes,” Sugarman said.

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Sales tax revenue estimates diverge: John Pertner of GA Public Solutions offered the fund’s actuarial statement.

He posited that there may be economic recessions between now and 2060, when the tax is slated to sunset. As since 1974, over a decade was spent in economic recovery — including a seven year decline and recovery period between 2006 and 2013, a period which saw sharp decline followed by gradual recovery.

That indicated what the report called a “significant impact” from recessions.

“You’re going to run into negative performances,” Pertner said, with the question being how long recovery takes.

Pertner projects a 3.34 percent YOY increase in sales tax revenue, compared to a more optimistic 4.25 percent per annum increase from the city.

Jacksonville CFO Mike Weinstein cautioned that whatever number is used “will be reviewed every year,” as per ordinance.

“The four and a quarter will be reviewed every year. This is a reasonable expectation of where we are today,” Weinstein said.

“It’s not like Better Jacksonville where we borrowed a billion and a half at 5 percent and the money went to debt service,” Weinstein said.

All told, the PFPF projects that $6.637B could be brought in by the surtax by 2060.

But the recommendation is to use the lower growth rate assumption, rather than the city’s, as a starting point.

Similar pessimism was to be found in payroll growth revenue.

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Negative amortization qualms: The board offered an experience study from Pete Strong, the board’s internal actuary, to analyze payroll growth.

The city posits 1.5 percent growth per annum. Strong was not so bullish on that, saying the historical average was .67 percent.

Strong notes that in a closed pension fund, a payroll growth rate historically is factored in. But current state law requires a reflection of “open group payroll.”

Strong also indicated the possibility of negative amortization, where payroll growth doesn’t cover the interest on the unfunded liability, presenting a “risk to the health of the plan.”

In that context, a 1.25 percent payroll growth rate — half of that of the city’s projection — is Strong’s advice.

Also discussed: whether DROP assets can be invested separately. That may be a heavy lift, given the anticipated 8.4 percent return. Strong continued to outline issues created by the ordinance, including the use of chapter funds and issues deviating from “reasonably sound actuarial analysis.”

Among those: using the future revenue stream as a present asset, which Strong said was unprecedented.

The “unique structure capitalizes an unknown future revenue stream as present dollars,” Strong said.

Meanwhile, discussions ensued of the potential for a constitutional challenge of the legislation, in that it passes on present costs to future generations.

Strong noted increased costs: $176M in benefit payments from salary increases, $64M in benefits from the new ordinance.

City contributions would go down, and so would the fund’s funded ratio — from 45 to 43 percent. And, because of the asset provided by tax revenue, the UAAL for the police and fire pension fund would go down $580M, to $1.42B.

“However, this is not the revised funded ratio for the fund,” Strong noted.

Strong discussed the difference between 4.25 and 3.34 percent for tax revenue growth as meaning a potential shortfall of $10M for the city’s contribution.

 That, coupled with the 30 year amortization, means the “funded status could deteriorate in the short term.”

As well, “it is our opinion that current costs will be transferred to future taxpayers under this arrangement.”

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30 year projections: Strong presented a number of possibilities.

One such had no changes. Another was a “stress test” with a -15 percent yearly return (with a recession in mind). Still another was under the city’s plan, with a built in stress test. And yet another dealt with the more pessimistic projections from PFPF actuaries.

Under the current scenario, the plan would be fully funded by 2033; with the negative return year built in, that would be 2036, assuming the city applied $460M of payments required by the 2015 agreement.

Board Chair Richard Tuten noted these payoff dates are around the time money kicks in from the Curry plan.

Under the city’s assumed rates of payroll and sales tax increases, the plan will be 51.85 percent funded by 2047 — though that doesn’t factor in the sales tax.

The “stress test” would strain the plan, putting the 5 to 1 liquidity ratio mandated by the ordinance in jeopardy for a full decade, according to the PFPF actuary projection.

“This only happens when we assume a stress test,” Strong noted.

With a 3.34 percent anticipated tax revenue increase and a 1.25 percent payroll growth increase, the fund would be more able to withstand the stress test, Strong added.

No matter which projections are accepted, Strong said, the unfunded liability grows, peaking right as the surtax begins to come in.

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Weinstein strikes back: It was inevitable that CFO Mike Weinstein would have his say.

He noted the 4.25 percent projection for tax revenue growth is conservative, and “each year it doesn’t go down gets us closer to the present value.”

As well, Weinstein said the distribution of funds would be adjusted yearly based on the needs of the discrete pension funds.

“The payroll growth piece — we’ve had numerous calls and visits to Tallahassee,” Weinstein said, and the state is “comfortable” with the city’s projections.

The projections can’t change from the city’s, said Weinstein, given the two-year process “getting us where we are today.”

“We stand by the 1.5. And we stand rigid on the 4 and a quarter,” Weinstein said.

The city feels good about the projections, especially in terms of Jacksonville’s permits “skyrocketing.”

As well, Weinstein expressed comfort with the liquidity floor.

“You can’t pay off a $2.86B debt without an impact,” Weinstein said.

General Counsel Jason Gabriel chimed in his periodic reminder that his office holds authority over the city’s independent authorities — including this board.

Gabriel noted that the city sits on firm legal ground, and that the city controls these pension reform deals relative to the discretionary sales tax, with the board having limited powers.

Board Chair Tuten fired back, saying “no matter what we recommend to you, you’re going to do 4.25 and 1.5.”

Gabriel denied that assertion, but did say the city determines the use of the surtax.

The difference between the projections helped carry those in the room into the fourth hour of the meeting.

Weinstein stressed that, if things go south, the city will have to pay up in lean years — and that the City Council would be charged with yearly review of the plan, including the rate of surtax growth, to determine the city’s contribution.

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Deliberation: A motion was issued and seconded by the Financial Advisory committee to accept the 1.25 percent yearly payroll growth increase from the PFPF actuary, and was quickly seconded, as a “more conservative, more rational” approach.

That motion carried.

From there, the question of tax revenue growth.

Questions emerged about a lack of robustness of the analysis, which only goes back historically to 2000.

Before that, of course, the 1/2 cent tax was not in play.

A desire for conservative estimates colored the discussion; however, the Financial Advisory committee — with cavils and caveats — accepted the 4.25 percent yearly projection of tax revenue increase — the city selected rate.

With committee recommendations, the full board of trustees accepted the terms.

The fund will provide more fleshed out opinions next week to the Jacksonville City Council.

Critics ‘chirp’, while Lenny Curry surges to the end zone

Thursday saw FloridaPolitics.com offer up three stories on discussions of Jacksonville’s pension reform pitch to the Jacksonville City Council.

If you are looking to read reportage of Mayor Lenny Curry‘s remarks, long-form presentation of Curry’s chief lieutenants, reaction of the Jacksonville City Council, use the helpful hypertext links below.

However, if you’re looking to read analysis of the early part of the last marketing push for the deal, read on.

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What you will notice about this push, if you’re paying attention: a sense of shared urgency from those with a serious interest in near-term policy and political animals also.

The General Fund, should pension reform not go through, should the “dinosaur” defined benefit plans not close and the sales tax extension not be guaranteed, will take a $349M bath next year.

If the reform package does go through, that’s a $208M hit.

In a city with some horrible problems, most of them related to being starved for capital in local government, that $141M budget relief is necessary.

Necessary for the costs we see. And for the costs we don’t. A proposed homestead exemption hike could take $36M out of city coffers, should it become law. And, sooner or later, the housing bubble will burst — and millage collections will tank, as they did a decade ago.

The urgent need and what they see as a convergence of reliable mechanisms (ending new defined benefit plans, creating a dedicated revenue stream) has created a sense of universal buy-in from the Mayor’s Office.

Resistance is not something that will be rewarded. Whether from the donor class or from elected politicians, any push back will be seen as provocation.

“Let the critics chirp,” in this context, does not mean said critics are encouraged to “keep it 100” and “join the conversation.”

In football terms: it is 4th and goal, with time enough for one play. Either you are blocking for the ball carrier, or you’re on the other side of the line.

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 Most of those watching inside of Council Chambers would have deemed Thursday’s effort to be a success in terms of driving the ball closer to the goal.

Curry offered an energetic opening statement, loaded with the kind of affirmational language the mayor has offered since his “One City, One Jacksonville” themed inauguration.

“We are poised to solve one of our city’s biggest challenges … a challenge that my predecessor handed off to a task force .. with a solution that would barely make a dent,” Curry said, also calling out critics of the current plan, whose plans would “make things worse.”

Those critics have emerged from disparate quarters since last year’s run up to the referendum approving the extension of the city’s half-penny sales tax (contingent on unions negotiating new deals, and council approval). And the mayor has personalized that criticism. But in a room where some of the sharpest critics sat, Curry’s by now well-rehearsed jab at them made for good theater.

Curry’s time on the microphone was short, as he handed off to the city’s chief administrative officer, Sam Mousa, and chief financial officer, Mike Weinstein.

They worked a tag team approach. Mousa, for the most part, limited his remarks to the front and the back of the pitch. Weinstein, meanwhile, took the council through the paces in a 35 page presentation — one where slides were distributed, to the press and the council, one at a time — with the effect being that of worksheets passed out in a classroom, but 35 individual times.

Media members may have groused. But the administration got away with it.

Council members did ask questions — and others had questions they intended to save for meetings outside public view — but the pitch was clean.

And why wouldn’t it have been? Getting walked through a full actuarial report required people to hold their questions until the end, blunting any urgency in the questions, especially when waiting through a break between presentation and questions, and then through a queue full of many council members.

The plan, as sold, was like a second mortgage for the ~$3B unfunded actuarial liability. Relief in the short and medium term, which would allow investments in infrastructure, replenishment of the city’s workforce, and raises for current employees ranging from 14 percent for general employees to 20 percent for police, fire, and corrections.

But, as Curry said, retiring an inherited debt of that size would have costs associated with it. And part of those costs is reversing trends that became ingrained habits after a decade of austerity (outside of dealings with the local NFL franchise) in city government.

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Friday saw the mayor on a media blitz, with television stations allowing a distillation of the message: reform, in the grand tradition of the strong mayor form of government.

Hence, the “most important decision since Consolidation” rhetoric.

Curry’s operation, consciously or not, has branded around the idea of a unified city, one with a shared sense of narrative.

“One City, One Jacksonville” was a reversion to internal branding, closer to “Bold New City of the South” than the tapioca, pleading “Where Florida Begins.”

To make that case, it’s imperative for Mayor Curry to take his case to the people, using television as a way to paint the picture with bold, broad strokes … ,much as he did Friday, when he did a TV loop.

The caveats end up in the endnotes. That was the bet made when marketing the Yes! For Jacksonville referendum in 2016 and, at least until the Jacksonville City Council votes,  expect more bold, broad strokes.

Curry’s political committee, likewise, could be a vessel to sell the plan.

With $303,000 on hand, radio, television, and mailers are all at its disposal — allowing the mayor’s political team to frame the narrative … if they need to, that is.

Critics may chirp. But the mayor is driven to will the ball over the goal line.

Meanwhile, the mayor’s team has decided to aggressively frame the narrative — one that has been percolating since Curry took office.

Pension votes have gone sideways before. But this won’t be the issue the Jacksonville City Council bucks the mayor’s office on. Not with two years of budgets to work through, and 11 people looking to be re-elected.

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