House unveils defined-contributions plan for future state employees

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House committee unveiled a proposal Thursday that would shift all future state employees to a 401(k)-style retirement plan even as the chairman indicated the measure’s future could depend on studies of the proposal’s financial impact, reporst Brandon Larrabee of the News Service of Florida.

The draft legislation, which has not formally been published as a proposed committee bill, would push all state employees hired after Jan. 1, 2014 into a defined-contribution plan instead of the defined-benefit plan that most state workers currently join. Supporters say the plan will make the retirement plan more predictable and takes the state off the hook.

“There will no longer be a blank check written by the taxpayers,” said House Government Operations Subcommittee Chairman Jason Brodeur, R-Sanford.

But Brodeur stressed that current employees would not be affected.

“This does nothing to pull back promises that were made in the past,” Brodeur said.

Democrats and unions, though, argued that the state’s pension plan is one of the best-funded in the nation and is financially sound.

“What exactly are we trying to fix here?” asked Rep. Irv Slosberg, D-Boca Raton.

In fact, critics of the measure say it could cost state taxpayers additional money, beginning with $150 million next year and escalating to $450 million within three years. The state would continue to pay until 2018, they said.

“We are looking at potentially billions of dollars in taxpayer revenue simply to fix a system which we’re still not sure what the problem with that system is,” said Rich Templin of the AFL-CIO.

The battle is a remnant of the fight two years ago between unions and largely Republican supporters of overhauling the retirement plans. Then, legislators voted to require employees to contribute 3 percent of their income to the retirement plan, but shied away from Gov. Rick Scott’s insistence that workers should eventually be shifted to a designed-contribution plan.

Unions eventually sued to block the 3 percent contribution, but the Supreme Court ruled last week that lawmakers had the right to make the change.

Rep. Ritch Workman, the Melbourne Republican who spearheaded the 2011 changes, said at the time that the existing system needed to be fully funded before moving to a 401(k)-style plan. But House Speaker Will Weatherford, R-Wesley Chapel, has said he thinks the state needs to make the switch. And Brodeur said that the state’s budget situation is now strong enough to consider the changes.

“Most of our concerns and risks about the current system are about our out years — years 15, 20, 25 — so by making a small change now, we can avoid drastic changes in the future,” he told reporters.

At the same time, he said the legislation’s future could be determined by a study that the House has commissioned to find out what impact the overhaul might have.

“If the study comes back, and it is not where we thought it was going to be, I don’t know how much appetite members are going to have to do something like that,” he said.

For his part, Workman said he’s now confident lawmakers will find a solution.

“I won’t support a bill that increases the liability to the taxpayer to get to a certain destination,” he said. “But I think we can get there.”

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including,,, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.