Legislation to wean state employees off the Florida Retirement System is ready for a vote in the Senate.
That’s a “generational change” to ensure the pension’s long-term stability.
FRS is the primary retirement plan for employees of state and county government agencies, district school boards, community colleges and universities.
The proposal comes as Florida faces $36 billion in unfunded actuarial liabilities. Unfunded actuarial liabilities are a measure used to determine if the state will have enough funds to satisfy future needs.
To date, the FRS services more than 644,000 active employees and more than 432,000 retired members. Another nearly 34,000 people are members of the Deferred Retirement Option Program.
State and county government agencies, school boards, universities, colleges and law enforcement agencies use the system.
Other states have made the switch to an investment plan. Rodrigues acknowledged that the shift hasn’t worked out for every state, but he said Florida’s situation is different
Florida could avoid a “death spiral” because the state’s retirement plan is currently funded at 82% rather than a level like 30%.
“Many of those state where it did not work out waited too long to make the switch,” Rodrigues said.
Notably, labor unions and Democratic lawmakers are pushing back against the proposal. And critics contend the FRS helps attract new employees and fear changes may thwart recruitment.
Democratic Sen. Loranne Ausley called pensions a “fundamental promise” made to state employees. But Rodrigues said the new plan would protect that promise for the state’s existing employees.
“The money that they’re paying in was always their money and will always be their money, and will be their money whether this bill passes or fails,” Rodrigues said.
There is no House companion for the measure. The bill next heads to the House, which may assign it to committees for consideration.
Florida Politics reporter Jason Delgado contributed to this report.