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Florida State Representative Janet Adkins called this week for state Governor Rick Scott to consider launching an investigation into possible misconduct at the Jacksonville Police and Fire Pension Fund.
According to Rep. Adkins, the investigation would focus on:
– Why “a special pension plan…was designed for one or two beneficiaries”
– Whether rules and laws have been broken “in regards to the creation, management and regulation of the DROP accounts”
How will the city pay an additional $40 million each year to more quickly pay down its unfunded liability?
If it’s up to Mayor Alvin Brown, it won’t be a sales tax. Or a property tax. Or any tax for that matter.
If council ends up seeking the Legislature’s approval to put such a funding mechanism on the ballot, Brown would not support it.
“No, sir. I wouldn’t sign it,” Brown responded when council member John Crescimbeni asked if he’d support a bill for a tax referendum.
Brown later went a step further, telling council member Bill Gulliford he’d veto any such attempt.
“I don’t think we have to do any taxes to solve this,” Brown said.
Brown and Police and Fire Pension Fund administrator John Keane struck a deal this year that has the city paying a total of $400 million over the next 10 years make the stabilize the plan. That $40 million each year would be determined annually by a newly formed committee. For months, council members have said not having an identified source is a chief concern — sentiments that spilled into Wednesday’s almost four hours of talks.
Council member Lori Boyer said not having the source identified was “totally irresponsible.” The burden, she said, would come back to council for the financial wrangling “and everyone (else) can stay hands off.”
Brown told the group he and his administration are “working on it.” Chris Hand, Brown’s chief of staff, said there isn’t a dedicated funding source “yet.” The JEA proposal is the only one the administration has pitched as a funding source to this point.
The Jacksonville Police and Fire Pension Fund is 43 percent funded and is shouldering $1.6 billion of unfunded liabilities.
A five-year long court fight continues to play out in Jacksonville, and chances are good this lawsuit will continue to stretch on even after an initial judgement is filed.
City employees filed the class-action lawsuit after Jacksonville barred many workers with medical issues from entering the pension system. The workers say the city violated the Americans with Disabilities Act. From the Florida Times-Union:
The suit involves about 1,400 employees, and at one point their lawyers said the case might affect up to $500 million of pension payments, spread over 30 years. But there are too many details unanswered still for either side to talk about a price tag yet.
The employees bringing the suit argue the city violated ADA rules by requiring new workers to be screened for health problems such as diabetes and heart disease before they could enroll in the city’s pension system. People with medical issues could be blocked from enrolling in the pension and would instead pay into Social Security, or they could sign a waiver that disqualified them from getting any death or disability benefits based on their particular issue.
“The sole purpose of the examination was to address the terms under which an employee would be admitted to the pension plans, if admitted at all,” reads the judgment drafted by the plaintiffs.
The city changed its rules in 2010 to allow employees to buy pension coverage they couldn’t get earlier, but the suit is about what expenses the city should cover.
The city has argued that it has no liability in the case; if the judge rules on the side of the city, the case will wind down quickly.
But if the ruling falls on the side of employees, more court battles loom. Among them: how much does the city owe? Once that number is determined, the court will need to decide how to divvy up the damages amongst the employees.
Over the last few years, Curtis Lee—Jacksonville resident and retired pension attorney—has filed dozens upon dozens of public record requests relating to the Jacksonville Police and Fire Pension Fund.
But Lee claims that instead of getting access to the public records he requested, he was stonewalled by the State Attorney’s Office for the Fourth Judicial District.
In one instance, says Lee, the Office waited a full year to provide an initial response to his requests. In another, the Office sent investigators to Lee’s home to tell him to stop contacting the Office and to question him as to his purpose for requesting the documents.
So Lee filed a lawsuit against the Office alleging they violated public records laws with their actions.
And the law gave Lee some solace this week when a judge sharply criticized the Office and ruled that they will have to pay for all of Lee’s legal fees. The judge, however, did not rule that the Office intentionally broke public records laws, which would have carried more serious penalties. More from the Florida Times-Union:
A judge ruled State Attorney Angela Corey’s office broke Florida’s public-records law, scolding the prosecutor’s office for sending investigators to question the citizen in his home and never demonstrating why the unusual visit was “necessary and appropriate.”
Judge Karen Cole also criticized Corey’s office for refusing to accept Lee’s cash for records and in some cases taking more than a year to provide even an initial response.
The State Attorney’s Office will have to pay Lee’s legal fees for his lawsuit against it. Cole will need to figure out exactly how much that is. Lee’s attorney, Brooks Rathet, said it should be somewhere around $20,000.
The State Attorney’s Office also violated public records laws by requiring the public to pay for records with business checks, cashier’s checks or money orders. Cash and debit cards were not accepted.
To get a money order, Lee and others had to pay a third-party service a fee. That, Cole said, “unlawfully burdens” citizens. From now on, the State Attorney’s Office has to accept cash for records. If the office wants to, the judge said, it can also allow other types of payment.
Cole also described how the State Attorney’s Office violated the law by taking too long with its response to requests.
As one example described, Lee sent Corey’s office six letters with 27 categories of public records requests in February 2011.
About five days later, two State Attorney’s Office investigators came to Lee’s door, according to Judge Karen Cole’s final judgment.
Sending investigators to tell someone to stop calling the State Attorney’s Office “would have a chilling effect,” Cole wrote, for most people. Most people might not have continued requesting records after a visit like that, she wrote.
After the judgment, the Office told Lee that they would produce the records he had requested by Thursday, August 14.
Lee filed a similar lawsuit against the Jacksonville Police and Fire Pension Fund. Lee won certain aspects of that case, but the case is now being appealed to the Supreme Court by the fund.
When it comes to funding its pension system, Jacksonville doesn’t have the best track record. In fact, it has just about the worst: only Chicago and Philadelphia run pension funds that are unhealthier than Jacksonville’s.
With that in mind, the city put together a task force to recommend ways to improve the solvency of its pension system. That’s no easy task, considering that most solutions are bound to be unpalatable to a large segment of the population.
In a 51-page report released today, the task force called for shared sacrifice—higher employee contributions, higher retirement ages for some and higher taxes for all.
Taxpayers — The City Council would increase property taxes and give voters a choice whether to replace the higher property taxes with a half-cent sales tax. The extra money would pay down faster what the city owes the Police and Fire Pension Fund.
Police and firefighters — Their share of money from their paychecks going to retirements would rise to 10 percent from the current 7 percent rate. New hires would work longer to get pensions. Current workers would have smaller cost-of-living adjustments on portions of their pensions.
Police and Fire Pension Fund — The board would appoint an investment advisory committee. The board would have greater leeway to make investments that are riskier but can generate higher returns to support pension obligations.