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House Set To Approve Retirement Changes

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TALLAHASSEE (NSF) – The House pushed forward Tuesday with a controversial bill that would overhaul public retirement benefits, batting away a Democratic amendment looking to separate a widely supported change to death benefits from a contentious effort to place more employees in a 401(k)-style plan.

The defeat of the amendment sets up a showdown with the Senate, which is likely to reject the House's attempt to link the two issues. The House is expected to approve its version of the legislation Wednesday.

House Republicans, who have long tried to shift workers out of the traditional pension plan and into the investment plan --- which resembles a 401(k) --- have proposed changing the "default" for state and county employees who don't pick a plan shortly after joining the workforce.

Currently, workers joining the Florida Retirement System default into the traditional pension plan; under the House bill (HB 7107), they would end up in the investment vehicle.

Supporters say it makes sense for employees to automatically go to the investment plan, because young workers in particular are now more likely to change jobs every few years. Employees have to work for the state for eight years before vesting in the traditional pension plan.

"It is, I think, more appropriate that if they fail to make a choice and we're going to make one for them --- and let's not kid ourselves, we make a choice for them right now by putting them in the pension --- they would be better off to be in the investment plan," said House State Affairs Chairman Matt Caldwell, a North Fort Myers Republican handling the bill. "We need to make that choice for them."

The House legislation also incorporates some provisions dealing with death benefits the Senate is seeking, as well as a fix to unintended consequences of legislation passed several years ago meant to cut down on "double dipping" by members of the retirement system.

The Senate has focused on increasing death benefits for families of first responders killed in the line of duty and making changes for those in the investment plan. The House would make changes to the death benefits for all workers in the investment plan.

Sen. Jeremy Ring, a Margate Democrat and key lawmaker on pension reform, has rebuffed the House's approach, saying it would lead to lawmakers "negotiating on the bodies of our dead first responders."

House Speaker Steve Crisafulli, R-Merritt Island, said Tuesday the House has watered down its previous efforts to revamp pensions, including a past proposal that would have forced all new employees into the investment plan.

"This provision is far different than what we passed out in the past," Crisafulli said. "This is a better piece of policy from the standpoint of thinking that we could get Senate support on this piece of legislation."

He called Ring's comments "unfortunate."

On a 70-42 vote, the House turned aside an amendment that would have removed the default language. A handful of Republicans who often break ranks on pension legislation joined with Democrats in supporting the amendment.

Supporters said it would be better for employees and would avoid the initial costs that come from more workers joining the investment plan.

"Vote for our heroes and sheroes who protect our community --- that's our police officers," said Rep. Dwayne Taylor, D-Daytona Beach. " ... Those firefighters, on the front line, protecting our lives and our property. The school teachers, those who we entrust with our children every day in the classroom educating our children. Our government workers, those who help deliver the services that the people need in our community and right here in Tallahassee."

But Rep. Fred Costello, R-Ormond Beach, said early increases in the gap between the pension plan's commitments and its assets --- because fewer people would be contributing to the pension system --- would be reversed later, when more workers were drawing from their own investment accounts instead of the state's holdings.

"Voting down on this amendment actually saves money in the long term," Costello said.

After the amendment's defeat, critics said the bill and its death benefits language was likely in trouble.

"I don't see it moving anywhere. ... Sometimes this place is pretty callous, and they intermingle good and bad, and they play with people's lives, and I think that's unfortunate," said House Minority Leader Mark Pafford, D-West Palm Beach.

The News Service of Florida's Brandon Larrabee contributed to this report.

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