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Reducing abuse of state pensions

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The Tampa Tribune

Published: July 12, 2009

The government's definition of retirement in Florida strikes most workers in the private sector as exorbitant, or at least peculiar. If you're covered by the state retirement plan, retiring comes when you start getting pension checks.

For many state workers, retiring doesn't mean the end of a career. Far from it. It means a never-ending bonus for staying on the job.

The rules plainly say "you may retire while you continue to work." Taxpayers naturally have begun to complain about supporting a system that commonly gives a simultaneous paycheck and retirement check to the same person.

This year the Legislature, pushed by Sen. Mike Fasano, finally responded to criticism of the state's increasing number of official retirees in full-time government jobs.

Lawmakers found a reasonable compromise between paying the earned pension benefits and stopping the worst abuses of the program. Starting next July, the law will require a state worker to be off the public payroll for at least six months before returning to collect both a paycheck and a pension check. And there is no guarantee the same job or any job will be available or offered.

The change is aimed primarily at elected officials who, after winning re-election, have been returning to their old posts to receive what in some cases is nearly double pay.

The six-month waiting period ends the game of secret retirements. It's too long for an important job to stay unfilled. It won't affect many lower-level employees who retire. They typically aren't offered a chance to return to their old jobs.

Next year the Legislature should take the reform a step farther and put tighter restrictions on the so-called DROP program, which allows veteran employees to bank their pension payments during their last five years on the job.

Changes won't come easy. Any mention of reforms of state pensions, which also cover Hillsborough County workers and many others in local governments, brings protests from the workers who say they are only getting what is rightfully theirs. They unfairly accuse Fasano and other reformers of trying to strip them of the benefits of many years of loyal service. If waiting six months is a burden, then they can immediately get a job in the private sector when they "retire," if they can find one.

Fasano and Rep. Robert Schenck of Spring Hill ran into resistance getting the law changed because some lawmakers are looking forward to getting the same double-pay deal for themselves. Others correctly pointed out that it's unfair to tell retirees they can't hold another government job.

What about a retired teacher or deputy who wants to go into another line of public service, maybe even run for office? Shouldn't that person be paid the same as anyone else?

The smart compromise on a six-month waiting period will allow such a career change, but the gap in service is necessary to weed out those who are taking advantage of an unnecessarily generous retirement offer.

Some workers complain that they can't afford to retire on their pension check alone. Fine. Don't retire until you qualify for Social Security or Medicare, like almost everyone else.

Few lawmakers have the stomach for it, but additional reforms do need to be made.

Some workers have gamed the system by working huge amounts of overtime in their final few years to qualify for a much larger lifetime pension. That abuse should stop.

Lawmakers should look into how the state can afford to pay 6.5 percent guaranteed interest on money employees invest in the deferred retirement program at a time the federal funds rate is near zero.

Retirees are given a 3 percent cost of living raise each year, but the cost of living for all urban consumers has actually decreased 1.3 percent in the past 12 months.

The result is a 4.3 percent raise for retirees while many workers still on the job are facing layoffs or cuts in pay. That's unfair.

Many of these generous retirement promises were made when pension investments and tax revenues were rapidly increasing.

Now that financial conditions have changed, the Legislature should put the brakes on the benefits train.

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