Committee approves pension reform deal

Funding source still in question


JACKSONVILLE, Fla. – The Jacksonville City Council's rules committee has approved a pension reform deal to fix the city's $1.7 billion deficit.

The finance committee is expected to approve the deal Tuesday, and then the full council must vote on it next week.

The deal is far from what the mayor and the Police and Fire Pension Fund agreed to last summer, but it gives a clear indication of where the council is heading. The problem is twofold: There's still no idea of how the city would pay for it, and the deal could be rejected by the Police and Fire Pension Fund even if the full council approves it.

As for the differences in the latest deal, there would be no automatic cost of living increase for current employees who retire. It would be based on yearly Social Security adjustments.

It also makes changes to the Deferred Retirement Option Program, in which employees eligible for retirement can work longer and get a larger retirement payment.

The deal also makes changes to the pension board and the executive staff.

One major change is, it does not recognize the current 30-year agreement that's in place, and that is troubling for the fire union.

"I think it sends a signal to everybody," said fire union president Randy Wyse. "If you have a contract with the city and all of the sudden you say you don't like it and we are going to get rid of it, I think it sends a signal to all branches of government and business."

"What we're trying to do is come up with some type of resolution that is reasonable to all parties," councilman Bill Gulliford said. "If we pass that, we know we have a deal, provided we come up with a funding source."

That is the problem. Where is the $40 million a year going to come from for the next 10 years. There are several options that are being discussed, including a tax increase or fee, or a plan former city council member Matt Carlucci is pushing along with JEA in which the city could take out a loan and JEA would fork over more money to the city.

"Pick your poison," Carlucci said. "Do you want to handle this with an ad valorem tax increase or sales tax increase, or the plan Mr. Appleby and I have been working on with others that does not raise rates or taxes."

The Mayor's Office said the rules committee's approval is a major step forward in pension reform.

"Today's committee action represents the first time in recent history that a City Council committee has voted in favor of a version of retirement reform," Chris Hand, the mayor's chief of staff, said in a statement. "That step represents forward progress, and forward progress is a good thing. We will now see what the Finance Committee does tomorrow, what the full Council does next Tuesday, and how the Police and Fire Pension Fund responds."

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