Reports on Municipal Retirement Plans in Florida by the LeRoy Collins Institute

Reports on Municipal Retirement Plans in Floridaby the LeRoy Collins Institute

Florida League of Cities Annual ConferenceAugust 12, 2011

David Matkin, Ph.D.

Lead ResearcherLeRoy Collins Institute

Assistant ProfessorAskew School of Public Administration & Policy

Florida State University1

Retirement Benefit Reports

• Trouble Ahead: Florida Local Governments and Retirement Obligations (February 2011)

• Sustainability of Municipal Pension Plans in Florida (Sept 2011)

• Best Practices in Municipal Pension Plans in Florida (Oct 2011)

• Local Government OPEB Obligations in Florida (Late Fall 2011)

• Recent Changes in Retirement Benefits in Florida (Late Fall 2011)

• More coming…

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Sustainability Report Overview

• Largest 100 Cities in Florida• Fiscal Year 2009• Comprehensive Annual Financial Reports• Single-Employer Defined Benefit Plans

– General Employee (29%)– Police Plans (26%)– Firefighter Plans (24%)– Police and Firefighter Plans (13%)– Elected Official (2%)

• Draft findings

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Key Findings

1. Important to look at each pension plan

2. Nearly 1/3 of municipal pension plans are significantly underfunded

3. Troubled economy is not the primary cause behind significant underfunding

4. Underfunded pension plans tend to be significantly more expensive

5. General employee plans make up a larger relative share of the most well funded pension plans

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Why focus on the plan level?

• Examples:• Cooper City (FY2009)

– Managers’ Retirement Plan is 35% funded– Police Plan is 74% funded– General Employee Plan is 70% funded– Firefighter Plan is 65% funded

• Port Orange (FY2009)– General Employee Plan is 90% funded– Firefighter Plan is 46% funded– Police Plan is 44% funded

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How well are pension plans funded?

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Sustainability by plan type

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43% 36% 24% 21% 20%

How expensive are pension plans?

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Plan costs by participant type

• Median costs per plan participant

General Employees $9,732

Police Plans $22,715

Firefighter Plans $20,620

Elected Officials $13,556

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Questions & Comments?

collinsinstitute.fsu.edu

[email protected]

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