Jacksonville Mayor Submits New, Updated Reform Bill

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Jacksonville Mayor Alvin Brown has submitted a reworked version of the city’s pension reform proposal, which was previously passed by City Council but wasn’t approved by the city’s Police and Fire Pension Fund.

The bill needs to be approved by both entities before it passes into law. The City Council may vote on the new bill next month, according to the Jacksonville Business Journal.

More details from the Jacksonville Business Journal:

Brown’s bill comes in the wake of a City Council version of pension reform legislation, which was approved by a 16-3 margin in December, being sent back by the Police and Fire Pension Fund.

City Council worked with Brown to come up with changes that will, hopefully, appease the board. City Council still expects to make some changes, though, President Clay Yarborough told the Florida Times-Union.

Some of the sticking points of the council-approved bill were the interest rate that firefighters and police officers get on Deferred Retirement Option Program accounts, cost-of-living adjustments and City Council’s power to change benefits.

The council’s agreement with the Police and Fire Pension Fund will go until 2030. After 2030, the city and unions will have to settle all disputes through collective bargaining.

Additionally, City Council will be able to make changes to benefits if the groups are not able to reach an agreement.

The city’s Police and Fire Pension Fund was 43 percent funded at the end of 2013.


Photo by  pshab via Flickr CC License

Dispute Over Closed-Door Pension Meetings Could Go to Florida Supreme Court

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Did pension officials violate Florida’s Sunshine Law when they held negotiations with unions behind closed doors?

Yes, according to the 1st District Court of Appeal. But the Florida Supreme Court may soon get its chance to weigh in.

From the Jacksonville Daily Record:

A Jacksonville municipal pension fund has asked the Florida Supreme Court to take up a dispute about whether officials violated the state’s Sunshine Law by holding closed-door mediation sessions to negotiate changes in the pension system.

The 1st District Court of Appeal in October ruled in favor of Florida Times-Union Editor Frank Denton, who contended in a lawsuit that the mediation sessions amounted to collective-bargaining meetings, which were required to be open to the public.

But the Jacksonville Police and Fire Pension Fund Board of Trustees filed a brief asking the Supreme Court to review the case.

The brief argues that issues related to collective bargaining should be determined by the Florida Public Employees Relations Commission, rather than going to circuit court.

The appeals court ruling upheld a decision by Circuit Judge Waddell Wallace.

The case stemmed from mediation sessions that were held after Randall Wyse, chief negotiator for the Jacksonville Association of Firefighters Local 122, and other plaintiffs filed a lawsuit in federal court against the city and the Jacksonville Police and Fire Pension Fund Board of Trustees, according to the ruling.

The mediation sessions led to a tentative agreement about changes in the pension system.


Photo by  pshab via Flickr CC License

Pennsylvania Lawmakers: Municipal Pension Reform Needed

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Two Pennsylvania state Representatives – Rep. Seth Grove (R) and Rep. Keith Greiner (R) – have penned a column on Lancaster Online arguing for the reform of municipal pension systems.

Specifically, they argue for reforms that would remove pension negotiations from the collective bargaining process and would transfer new hires into a cash balance plan.

Grove and Greiner explain:

Gambling with pension funds needs to end by both local governments and employee unions. Pension negotiations need to be permanently removed from the collective bargaining process to ensure that our police and firefighters are not at risk of having their pensions destroyed, and taxpayers aren’t put on the hook because of short-term and short-sighted decisions.

These two fixes are both long-term solutions, but what can we do in the short term? The answer is change the pension benefit structure for new hires to a cash balance pension plan. A short-term solution will require new revenue to reduce the unfunded liability. A cash balance plan allows municipalities to use excess stock market earnings to pay off the unfunded liability.

Instead of raising taxes or creating new taxes, this allows the pension plan to fund itself. The cash balance concept also has long-term taxpayer protections built in. New hires will have their own accounts, just like a 401(k), which allows them to transfer their retirement between jobs and ensures taxpayers are not on the hook for future underfunding of pensions.

It also provides employees with the ability to take their retirement by monthly payments, which is just like a traditional defined benefit plan. And since a cash balance pension concept is considered a defined benefit pension plan by IRS guidelines, you can still combine pension funds together and ensure you do not underfund the old pension systems. Lastly and most importantly, it will not affect our current public safety personnel’s pensions, but will ensure that new hires will still receive a good pension, which they deserve.

We do not want to honor the dedication and service of public safety personnel by putting them in the poor house after retirement. However, we also do not want to shift costs from pensions to welfare.

Ultimately, these changes are actually about hiring more police and fire personnel and protecting the pensions of current police and fire personnel.

Furthermore, the changes are about ensuring that all municipalities across Pennsylvania are financially stable and that commuter taxes go away. There are tremendous upside benefits to all stakeholders.

Read the entire piece here.

Judge: Closed-Door Pension Meeting Violated Florida Sunshine Laws

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An appeals court ruled today that pension and union officials violated Florida’s Sunshine Law when they held benefit negotiation sessions behind closed doors.

More from News4Jax.com:

The 1st District Court of Appeal upheld a decision by Circuit Judge Waddell Wallace in a lawsuit filed last year by Florida Times-Union Editor Frank Denton.

The case stemmed from mediation sessions that were held after Randall Wyse, chief negotiator for the Jacksonville Association of Firefighters Local 122, and other plaintiffs filed a lawsuit in federal court against the city and the Jacksonville Police and Fire Pension Fund Board of Trustees, according to Tuesday’s ruling. The mediation sessions led to a tentative agreement about changes in the pension system.

Denton filed a lawsuit contending that the mediation sessions amounted to collective-bargaining meetings that violated the Sunshine Law, which requires such meetings to be open to the public.

Wallace sided with Denton, and a three-judge panel of the appeals court agreed Tuesday.

“We cannot condone hiding behind federal mediation, whether intentionally or unintentionally, in an effort to thwart the requirements of the Sunshine Law,’‘ said the ruling, written by appeals-court Judge Clay Roberts and joined by judges Simone Marstiller and Ronald Swanson. “Caution should be taken to comply with the Sunshine Law, and compliance should be the default rather than the exception. … By holding closed-door negotiations that resulted in changes to public employee’s pension benefits, the appellants (the city and pension fund board of trustees) ignored an important party who also had the right to be in the room — the public.”

The city still has not resolved the pension matter, and a marathon meeting is planned for Wednesday. The mayor is expected to address the issue.

The city is reviewing the recent ruling. There’s no word if it plans to appeal it to the state Supreme Court.

The Jacksonville Police and Fire Pension Fund managed $1.4 billion of assets as of September 2014.

Los Angeles Pension Reforms Rescinded by Labor Board; City Will Appeal


The Employee Relations Board, a five-member panel that handles labor complaints in Los Angeles’ City Hall, probably didn’t expect to become famous overnight.

But they’ve become a household name in Los Angeles this morning, after news broke that the Board voted to rescind a series of pension reforms passed by Los Angeles in 2012.

The Board ruled that city officials did not properly negotiate the reforms –which reduced pension benefits for new hires and raised retirement ages—with municipal employee unions. From the LA Times:

The Employee Relations Board voted unanimously Monday to order the City Council to rescind a 2012 law scaling back pension benefits for new employees of the Coalition of L.A. City Unions, on the grounds that the changes were not properly negotiated. That law, backed by Mayor Eric Garcetti when he was a councilman, was expected to cut retirement costs by up to $309 million over a decade, according to city analysts.

Ellen Greenstone, a lawyer for the labor coalition, described the vote as a “huge, big deal” — one that shows the city could not unilaterally impose changes in pension benefits on its workforce.

Coalition chairwoman Cheryl Parisi said in a statement that the reduction in benefits, which included a hike in the employee retirement age, “devalues middle-class city workers and their dedication to serving the residents of Los Angeles.

The city’s labor board is a quasi-judicial body that reviews complaints from unions, managers and individual employees. Under the city’s labor ordinance, the panel has the power to invalidate decisions by the council, said the board’s executive director, Robert Bergeson.

If council members do not agree with Monday’s decision, they can file legal paperwork seeking to have a judge overturn it, Bergeson said.

City officials have previously argued that changes in the retirement benefits of future employees do not need to be negotiated. The 2012 law rolling back benefits applied only to employees hired after July 1, 2013. Budget officials had hoped that the reductions would trim the city’s retirement costs by more than $4 billion over a 30-year period.

The board’s decision comes as the city’s contributions for civilian employee retirement costs have climbed from $260 million in 2005 to an estimated $410 million this year, according to a recent budget report.

Los Angeles, meanwhile, plans to appeal the board’s decision. From Bloomberg:

Los Angeles will appeal an administrative panel’s decision to roll back changes in public employee pensions that were expected to save as much as $4.3 billion over 30 years, a spokesman for Mayor Eric Garcetti said.

The second most-populous city’s Employee Relations Board concluded yesterday that officials failed to properly consult with municipal employee unions before pushing through the changes in a City Council vote in October 2012.

The city will appeal the board’s 5-0 vote in court, Jeff Millman, a spokesman for the mayor, said by e-mail. Millman said Garcetti, a 43-year-old Democrat, disagreed with the ruling, although Millman didn’t spell out the reasons.

Los Angeles was expecting to save between $3.9 and $4.3 billion over the next 30 years. If the city does indeed appeal the ruling, the reforms will then land in front of a judge, who will have the final say.


Photo: “LA Skyline Mountains2″ by Nserrano – Own work. Licensed under Creative Commons