Florida Pension Policy

Florida Pension Policy

Administrative Theory

If the article on ‘tough choices’ commissioned by LeRoy Collins Institute (2011) is anything to go by, then it is true that the issue of the cost and the sustainability of the public retirement benefits of public pensions has been an eyesore in Florida in the recent past. Even though the attention has been focused more on the Florida Retirement System, the people of Florida are no doubt facing a looming significant costs and liabilities problem resulting from the numerous municipal pension plans all over the state and now another from the state.

According to a recent program review of the Florida Pension Plan done by an office of the Florida Legislature: the Office of Program Policy Analysis and Government Accountability (2011), there are two Retirement System plans in Florida from which the members are at liberty to choose to be part of any of their own preference. The members can either decide of their own free will to be part of the Investment Plan or the Pension Plan. The same review goes ahead to explain the two pension systems by positing that “…The Investment Plan is modeled after private sector 401(k) plans, with employers contributing a set percentage of employees’ salaries to the plan each year and plan members selecting among 21 investment options. After working at least one year, retiring members of this plan receive the amount of money that has accrued. As of June 30, 2010, there were 97,782 participants in the Investment Plan, and the plan’s net asset value was $5.05 billion” (Office of Program Policy Analysis & Government Accountability, 2011). On the other hand, according the same review still in the “… Pension Plan, employers also contribute a set percentage of employees’ salaries, with employees receiving a defined monthly benefit upon retirement if they have been FRS members for at least six years and meet other age and eligibility...