The Florida Supreme Court ruled today, 4-3, that state employees must contribute 3% of their salaries to participate in the state's generous pension fund. The law was being challenged by the Florida Education Association (FEA) against a law Florida Governor Rick Scott signed in 2011. FEA was suggesting having over 623,000 public employees contribute 3% of their pay was unconstitutional - the state's Supreme Court disagreed.
Today Rick Scott said, “The court’s ruling today supports our efforts to lower the cost of living for Florida families. This means even more businesses will locate and grow in our state, which creates even more opportunities for Floridians to live their version of the American dream.”
The libertarian-minded James Madison Institute made the following statement concerning the ruling:
"The long delay of this Florida Supreme Court ruling on pensions had state officials on edge, wondering if an adverse ruling would cause a budget crisis. Fortunately, by a slim 4-3 margin, the Court has allowed Florida to move forward without this particular cloud hanging overhead. Like government employees across the nation, those in the Florida Retirement System will now contribute toward their pensions. That’s good news, but the pension reforms must not stop there.While the state's pension system is in relatively good shape, many of Florida’s major cities have their own plans apart from the state retirement system, and many of those cities face daunting problems. Therefore, the Legislature now needs to follow up this ruling by taking two important steps.First, for state employees, lawmakers should place all new hires in a 401k-style plan -- and should establish incentives that encourage current state employees to make the same choice. Next, to restore the fiscal health of those Florida cities facing severe cutbacks in public services because of unfunded pension liabilities, lawmakers should alter the 1999 law that limits how local officials may use the revenue from the insurance premium tax.Although some may perceive this Supreme Court ruling and these proposed legislative actions as a setback, all would be better served to take the long view. Unless we take prudent steps now, future public pensions could meet the fate of those in a growing list of cities where government retirees ruefully discovered that their municipalities could no longer afford to keep pension promises."
Broward Teachers Union President Sharon Glickman made the following public statement:
“Today’s Florida Supreme Court ruling against Florida’s hardworking public employees is disheartening. The only reason the Legislature and Governor took this action in the first place was to balance the state’s budget by taking money from Florida’s middle class workers who can least afford to lose it. Florida’s public employees were promised a non-contributory retirement and our state is turning its back on this promise with today’s ruling.
“With today’s ruling, we are resolved more than ever to fight this ruling by changing the face of the Florida Legislature in the upcoming 2014 election.”
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