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San Carlos tries to amend firefighters' pension rate
Wednesday, June 25, 2003
By CHRISTINA HOLDER, [email protected]
The San Carlos Park fire district wants to build retirement funds for a handful of its most senior employees who are being shortchanged.
The five employees have not been receiving the full benefit rate they should receive on "past service credit," or the amount of time an employee has worked for a company.
In 2000, Florida statutes increased the benefit rate for members of the Florida Retirement System from 2 percent to 3 percent of the member's yearly salary, but the amendment did not apply to the five firefighters who were hired before the district became a member of the Florida Retirement System.
"The problem comes down to a glitch in state law," attorney Jim Linn said. "If you buy back service, the most you can get is 2 percent."
The district thought the 1 percent discrepancy was unfair for the five employees because they had had worked longer than the employees who were receiving the higher benefit rate.
Recently the district's fire board decided to begin exploring the idea of setting up an annuity program for the employees to compensate for the 1 percent discrepancy.
Fire commissioner William Elliott has been talking with representatives from financial groups to find out the best way to rebuild the funds.
Linn said an annuity would be an easy way to solve the problem.
"An annuity is just a way to take cash and pay it into a financial institution, and then have the financial institution pay it out over time," he said.
Elliot said the employees are not angry about the lost money but do want it corrected.
Fire Chief Nat Ippolito said he has "mixed emotions."
"From a fire chief perspective, I think the district did everything they could do," he said.
Yet he thinks firefighters should receive the full benefits because that was one of the conditions they agreed to when they were hired.
Ippolito is one of the five who is affected and has been through a similar situation with the district.
In 1984 when he was a new hire, he noticed he was not receiving paperwork from the Florida Retirement System.
"They assumed the amount they were paying was going into the FRS," Ippolito said.
The district corrected the problem by officially joining the Florida Retirement System in 1985.
Ippolito said everything was fine until the state law changed.
The amount of money the district will have to pay back is small, Ippolito said.
For some employees preliminary estimates are up to $1,000 per year of service, but that estimate is on the "high end," he said.
"It's not like it's millions," he said.
Ippolito estimated it would take less than $50,000 to build the five employees' retirement funds from their hire date to their predicted retirement date.
Contact Staff Writer Christina Holder at 213-6039 or [email protected].
Wednesday, June 25, 2003
By CHRISTINA HOLDER, [email protected]
The San Carlos Park fire district wants to build retirement funds for a handful of its most senior employees who are being shortchanged.
The five employees have not been receiving the full benefit rate they should receive on "past service credit," or the amount of time an employee has worked for a company.
In 2000, Florida statutes increased the benefit rate for members of the Florida Retirement System from 2 percent to 3 percent of the member's yearly salary, but the amendment did not apply to the five firefighters who were hired before the district became a member of the Florida Retirement System.
"The problem comes down to a glitch in state law," attorney Jim Linn said. "If you buy back service, the most you can get is 2 percent."
The district thought the 1 percent discrepancy was unfair for the five employees because they had had worked longer than the employees who were receiving the higher benefit rate.
Recently the district's fire board decided to begin exploring the idea of setting up an annuity program for the employees to compensate for the 1 percent discrepancy.
Fire commissioner William Elliott has been talking with representatives from financial groups to find out the best way to rebuild the funds.
Linn said an annuity would be an easy way to solve the problem.
"An annuity is just a way to take cash and pay it into a financial institution, and then have the financial institution pay it out over time," he said.
Elliot said the employees are not angry about the lost money but do want it corrected.
Fire Chief Nat Ippolito said he has "mixed emotions."
"From a fire chief perspective, I think the district did everything they could do," he said.
Yet he thinks firefighters should receive the full benefits because that was one of the conditions they agreed to when they were hired.
Ippolito is one of the five who is affected and has been through a similar situation with the district.
In 1984 when he was a new hire, he noticed he was not receiving paperwork from the Florida Retirement System.
"They assumed the amount they were paying was going into the FRS," Ippolito said.
The district corrected the problem by officially joining the Florida Retirement System in 1985.
Ippolito said everything was fine until the state law changed.
The amount of money the district will have to pay back is small, Ippolito said.
For some employees preliminary estimates are up to $1,000 per year of service, but that estimate is on the "high end," he said.
"It's not like it's millions," he said.
Ippolito estimated it would take less than $50,000 to build the five employees' retirement funds from their hire date to their predicted retirement date.
Contact Staff Writer Christina Holder at 213-6039 or [email protected].