Florida taxpayers will spend at least $500 million this year to cover the unfunded pension of government workers. These dollars could have been used to support teachers, build roads, attract industry, reduce taxes and so much more.
As the 2013 legislative session enters its final stage, the Florida Legislature is grappling with reforming Floridas pension program. Reforming retirement benefits for government employees is one of the most important issues in the Legislature. For decades, government entitlements such as defined benefit retirement plans for government employees have grown far beyond benefits for the private sector.
To keep our promises to government employees, protect taxpayers and ensure state and local governments remain fiscally sound, the Florida Legislature is correct in advocating public pension reform. For many years, Florida was the only state where taxpayers paid 100 percent of state employee pensions. Opponents of free enterprise fight to keep it that way, but that simply is not sustainable.
The Florida Retirement System (FRS) is not in a position to take on new expenses and there are other challenges. According to the Florida Chamber Foundation, the FRS is only about 87 percent funded. That means, unless something changes, approximately 13 out of 100 government employees will not be able to rely on receiving their pensions. This simply is not sustainable, especially since Florida has the fourth largest pension program in the nation.
Thankfully, some of our elected leaders are tackling pension reform. Last month, the Florida House of Representatives passed HB 7011, a Florida Chamber-backed bill sponsored by Rep. Jason Brodeur, R-Sanford, which protects the long-term health of the FRS, and helps ensure retirement security for public employees. HB 7011 also expands investment options and protects the longevity of the system by allowing measures that add a cost savings to the program.
By taking the best practices used in the private sector, HB 7011 puts the long-term retirement security of public employees over short-term politics, and Speaker Will Weatherford and Rep. Brodeur are to be commended for leading the fight to protect Floridas public employee retirement system while also ensuring taxpayers arent left shouldering a greater burden. HB 7011 does not impact current participants in the FRS, but it will offer new employees security for retirement while reducing future burdens on taxpayers.
The Senate is also looking at a bill reforming public pensions. SB 1392 by Sen. Wilton Simpson, R-New Port Richey, will help protect government employees retirements without burdening taxpayers and causing fiscal instability to the state government.
While these bills will help make Florida the perfect climate for business, there is still much work to be done. The Florida Chamber will continue the fight to make Florida more competitive by ensuring that the FRS follows the best practices from the private sector and that public employees can preserve their own futures.
We invite union leaders to join us in our push to protect government workers' pensions, help make Florida more sustainable, and help families lower their tax burden.
Mark Wilson is the president and CEO of the Florida Chamber of Commerce.