"Panel Ok's revamp of Florida public employee pensions"

A proposal to end guaranteed pensions for new teachers, state and county workers and other public employees began moving through the Florida Legislature. A House panel voted to introduce a committee bill that would replace traditional defined benefit pensions with individual investment accounts similar to 401(k) plans for employees hired after Jan. 1, 2014. It would shift investment risk from employers to employees, a growing trend in the private sector. Benefits can vary widely depending upon the performance of investments each employee chooses. The bill also would end disability benefits for new employees. Opponents also objected to taking a vote before actuarial studies, which are expected to resolve that question, have been completed. A law passed in 2011 requires public employees to contribute 3 percent of their earnings to the system, in effect a pay cut.

Financial experts say pension plans that are at least 80 percent funded are considered on solid ground because employees do not all retire at the same time. The Florida system was 87 percent funded as of last June and since then its investments have grown by $10 billion to $132 billion as a result of the ongoing stock market recovery. In some years the fund has topped 100 percent. That's enabled the Legislature to divert about $12 billion in state contributions to other purposes over the past dozen years. Also, the 3 percent employee contribution is being used to reduce employer contributions instead of increasing the fund's assets. Public employers now contribute 3.55 percent for most workers.

Commentary: Let me restate the number one goal of the anti-public employee politicians and organizations one more time - it is about shifting risks away from the employer to the employee - period! The Florida pension is 87% funded and at times 100% fund unless the state underfunds and uses the money elsewhere. The private sector has moved to optional 401K plans, and we can see the results that 49% of Americans have no 401K plan and their retirement is just social security. 42% of private sector workers with a 401K have less than $120,000 and they have borrowed heavily against it.