Another Crist Veto Helps Teachers and ESPs

Crist Signs Budget, but Vetos to Spare Education Funding and Protect DROP

President Ford Letter Requesting Veto  | View FEA End of Session Report

Governor Charlie Crist has signed the state's $70 billion budget, and he used his line-item veto power to eliminate $371 million from the budget. Of particular interest to FEA was the veto of a $160 million sweep from the state's road-building trust fund.

 

In his letter to the Secretary of State, Crist says in part, “…the legislature chose to link this sweep to funding for the Florida Education Finance Program (FEFP).  We should not have to choose between jobs for Floridians or funding for our children’s education.  Therefore, I have decided to veto proviso that made funding for the FEFP contingent upon the transfer of funds from the State Transportation Trust Fund.”

 

The Legislature’s intent writing this language was that any vetoes of trust fund sweeps would automatically be deducted from the money that goes to pay for school operations.

 

The FEA Public Policy Advocacy department is investigating the implications of this veto.


You can read the veto message by clicking this link:

http://www.flgov.com/budget/hb_5001_vetomessage.pdf


The line item veto list can be found here:

http://www.flgov.com/budget/hb_5001_vetolist.pdf


The General Appropriation Act- HB 5001 - can be found here:

http://www.flgov.com/budget/hb_5001.pdf


In another move that will ultimately help all public employees, including teachers and support professionals, Gov. Crist has vetoed HB 5607, a proposal to reduce the annual interest rate for those state workers who enter the Deferred Retirement Option Program on or after July 1, 2010.  Crist said his decision to veto HB 5607 -- which would have lowered the annual the DROP accrual rate from 6.5 percent to 3.0 percent -- was due to the legislation surfacing  late in the session and should not have been "rushed through the process."


On May 13, 2010, FEA President Andy Ford sent Gov. Crist a letter requesting that the Governor veto HB 5607. HB 5607 was a bill that surfaced during the final hours of the 2010 FL Legislature and was never discussed in any Committee hearings, a point that Gov. Crist raises in his veto letter regarding HB 5607.

 
The Governor's veto of HB 5607 means FEA has successfully defeated all of the 30+ bills and proposals introduced during the 2010 Florida Legislative session that would have reduced retirement benefits for public school employees and retirees. FEA members and retirees across the state worked diligently, relentlessly, tirelessly, -- SUCCESSFULLY -- to make their voices heard, and so --  victory belongs to all!


The bill also contained two other provisions:

  • revised payroll contribution rates for membership classes of FRS for state fiscal years effective July 1, 2010, and,  July 1, 2011;
  • required a state actuary to consider additional factors when conducting annual actuarial study of FRS (basically a study of the DROP system).


As you may know, participating employers in the Florida Retirement System must make monthly contributions to fund the FRS based upon rates that are set each year in a bill.  That bill will generally have the current rates and a predicted or “pop up rate” for the following year. Since HB 5607 was vetoed and the future rates set in that bill were nullified with that veto, the employer contribution rates will be set to the “pop-up” rates effective in the 2009 (current) rate bill.  Those rates are as follows:


MEMBERSHIP CLASS

EFFECTIVE July 1, 2009

(current rate)

Effective july1, 2010

(next year’s rate)

Regular

8.69%

9.63%

Special Risk

 

 

Regular

19.76%

22.11%

Administrative

11.39%

12.10%

Elected officers

 

 

Leg – Atty - Cab

13.32%

15.20

Judicial

18.40%

20.65

County Officers

15.37%

17.50

Senior Management

11.96%

13.43

DROP

9.80%

11.14%


The total payment as a percent of salary to FRS from school boards is as follows:


FRS Regular Class Rate                            9.63%

Administration and Education Fees        0.05%

Retiree Health Insurance Subsidy           1.11%

TOTAL to FRS                                            10.79%


For members in DROP, the rate is 11.14% plus HIS and administrative charges. Note: The DROP rate is a blended rate and is the same for all FRS classes.

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