On Friday, the Jacksonville Police and Fire Pension Fund held its monthly meeting of trustees.
It was the first such meeting since the city agreed to tentative pension deals with the police and fire unions last weekend.
As part of that deal, the city will no longer be obligated to the terms of the 2015 pension reform agreement, including the extra payments.
Out of the loop in negotiations, it was inevitable that the PFPF Board would raise questions. And they did just that, before and during the meeting.
In sum, the PFPF believes that they had no say in the deal, and that without specifics, they can’t agree to the deal.
They also believe that the deadline to agree to terms by Mar. 15 is unrealistic, given that the deal is still opaque, especially relative to the role of the PFPF board — which was not at the bargaining table.
Before the meeting, Trustee Bill Scheu was asked about the deal.
He noted that there’s “no financial information yet,” in terms of the specific financial projections as to what it will cost the city.
Board Chair Richard Tuten expressed similar sentiments, noting that there are no numbers yet on paper that have been produced for the board or the media.
Scheu and Tuten expanded on these positions during the first hour of the meeting.
The position of Mayor Lenny Curry has been that such details are “exempt from disclosure” through the collective bargaining process.
However, it should be noted that the city projected real savings from the plan … when the city contribution was expected to be 10 or 12 percent on the defined contribution plan, not 25 percent.
In that context, the numbers are relevant to the discussion.
A public commenter kicked the meeting off, saying that he advocated signing the deal immediately, albeit with a waiver to make the 10 percent employee contribution voluntary.
The board disagreed.
Director Tim Johnson noted that the draft agreement cut out those voluntary payments, and advised that there be a workshop to discuss the pension surtax and the supplemental payments from the city, with an eye toward figuring out the board’s rights and role going forward.
Tuten advised that the lawyers be there to review the relevant ordinances, including the extra contributions from the PFPF.
“Until we have long-term numbers from the mayor,” Tuten said, the projections can’t be dealt with.
Time is of the essence, said a representative from the city’s office of general counsel.
“The agreements themselves provide for a short window. Everything has to be done by the 15th of March,” said Steve Durden of the OGC.
“The bills have to be introduced by Mar. 31,” Durden added.
Durden framed the deadline, meanwhile, as a device to facilitate the next budget.
As well, “parties just want things done,” Durden added.
That didn’t go over well at the table; the PFPF board asserted that they were dealt out of the negotiations.
Board members noted that the PFPF wasn’t a party to the agreement, yet Durden contended that the time frame was not elastic.
“We have no financial information, no nothing,” an exasperated Scheu said.
Durden advised that the “agreements were not done — the proposed agreements — until early last week. It has not been long. And I don’t know if it was appropriate to bring it to your attention.”
The workshop, said Scheu, is about the PFPF authority — not the terms of the deal, which is a different matter entirely.
“The mayor doesn’t want to pay the extra payments. We’re a little reluctant to give that up, now that it’s been codified by a federal court,” Tuten said.
“If the numbers don’t add up,” Tuten added, “it’s going to be a problem.”
Durden noted the board’s internal schedule conflicts precluded them getting together as a board.
“The mayor wants to get that information to you right away … what exactly’s in the deal,” Durden contended.
The deal was framed by PFPF Attorney Bob Sugarman as a “momentous decision … equivalent to a merger and acquisition. The numbers are very large, and you’re going to need legal advice, as well as outside advice.”
Requiring focus: the reliability of revenue streams.
“We’ve made promises with share plans, extra contributions … the contracts are a little hazy on what all this means,” Tuten said.
“Are we going to need the mayor’s complete plan? If he doesn’t spell out his numbers, we’re talking to ourselves,” Tuten added.
Tuten framed “what the mayor wants” as “irrelevant.”
“You don’t come and say — just sign it man, no big deal. Our responsibility is to the members, to make sure it’s fiscally sound … the mayor should be presenting a very convincing case at the moment to us … until we get those things from the mayor, there’s no way we can meet March 15.”
“A lack of planning on your part does not mean an emergency on mine,” Tuten said, eliciting laughter from the table.
“We’re going to need you to show us why this is a good deal,” Tuten said, “because you’re not going to be mayor in eight years.”
“Paying extra now doesn’t necessarily cost the city anything,” Tuten said, given the money will come in later.
“They don’t want to skip one year, they want to skip every year,” Tuten explained.
Tuten said they might need two months to figure out the specifics of the deal.
Scheu found it “shocking” that the board was being expected to approve a plan without hard numbers.
He also raised questions about whether the future value of the plan could be considered an asset.
Scheu also advised that “the mayor’s office will demean us” as a PR tactic.
“Now he’s likely to demean us for wanting to take our fidicuiary responsibility seriously. I for one think we need to exercise that,” Scheu said.
“We don’t have the power to sue the city,” Scheu said, “without city council approval.”
“The city is our partner here,” Sugarman said, “but we do have procedures we need to go through.”
This is especially true, Sugarman added, with a half a billion dollars on the line.
“Until we get a proposal, I can’t even tell you,” Sugarman said. “If the March 15 deadline is not realistic, that’s not our fault. We did not establish the Mar. 15 deadline. We need to know what we’re talking about.”
“It’s unlikely we’ll be able to do our due diligence in four weeks,” Sugarman said.
Sugarman noted that “each trustee has skin in the game,” and “you can’t buy enough insurance” to protect against personal indemnification if the pension deal doesn’t work out as advertised.
“All we have here is a deal sheet,” Sugarman said, and the real story is in the amendments and the ordinances
In sum, the PFPF believes that they had no say in the deal, and that without specifics, they can’t agree to the deal. They worry about revenue streams, usurped governance authority, and so forth.
There was also talk of enforcing the 2015 agreement in court, if need be.
On Friday afternoon, Mayor Curry offered a statement attempting to cool the tensions expressed in the PFPF Trustees meeting.
“Last weekend,” Curry said, “the Police and Fire union leadership reached a tentative agreement with us that keeps our promises to public safety workers, respects tax payers and is fiscally responsible. The tentative agreement included a timeline that would ensure that we solve this problem in a timely manner. The PFPF Board will have the financial information they need to make a responsible decision prior to their vote.”
Fire Union head Randy Wyse, in the crowd, understood the board’s position.
“I would not want the trustees to breach their fiduciary duty. They need time to make the right decision,” Wyse said.