House votes to close down guaranteed pension
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TALLAHASSEE, Fla. - New state employees like teachers, cops and firefighters will likely be saying sayonara to the pension plan.
The house passed a bill that would end traditional pension plans for new state employees, including teachers, cops and firefighters.
Here's how it would work: anyone hired after January 1, 2014 would be moved into more of a 401(k) style retirement system, which would subject them to the ups and downs of the market - instead of a guaranteed monthly pension.
According to the Associated Press, HB 7011 was approved 74-42 Friday afternoon. It does away with guaranteed pensions for workers hired as of January 2014. The measure replaces pensions with individual investment accounts similar to 401(k) plans. It's been a priority of House Speaker Will Weatherford.
"It just upsets the whole system," Alan Stonecipher said, with the Florida Center for Fiscal and Economic Policy, which opposed the move.
"(State workers) assume100% of the risk, and if they would have had their retirement savings in the stock market in 2008, they would have lost half their assets," he said.
"Republicans say that the move will save the state millions of dollars down the road. That money will go toward education and health benefits. What's your reaction?" Hogan asked Stonecipher.
"There's no evidence at all that it will save money," he said.
The bill now heads to the Senate.
Colleen Hogan, reporter