Opinion: Referendum 1 Totally Fails to Reform Pension

[Metro Jacksonville]

Opinion: Referendum 1 Totally Fails to Reform Pension





Read More: http://www.metrojacksonville.com/article/2016-aug-opinion-referendum-1-totally-fails-to-reform-pension

[brainstormer]

It doesn't surprise me one bit that both the fire and police unions support Mayor Curry. They know they have great retirement plans and true reform would result in them taking a small hit on their benefits. Look at how great Sheriff Williams has it. He already "retired" once and now because he is sheriff can bank that money and will have another 4-8 years of adding to his pension. Won't he have an amazing quality of life when he "retires" for a second time! No wonder he so willingly offered to endorse Curry's tax.

I have been saying all along that I am voting no. We should be raising property taxes to meet our obligations now and not saddling the future generation with an even greater burden. Curry is a failure. We need real leadership.

[JBTripper]

The text of the referendum calls for closing "up to three" of the city's underfunded defined benefit retirement plans, AND increasing the employee contribution for each of those plans to a "minimum of 10 percent." How is that "all tax, no reform?"

I'm not trying to be confrontational, I'm just asking. I don't yet know if I will vote yes or no because it's so hard to get the straight dope from anyone.

It seems to me that requiring a 10% employee contribution would be a MASSIVE transfer of the burden from the taxpayers to the city employees who enjoy the gold-plated retirement plans, because I can't imagine a world where they are paying anything close to that now. It also seems like the option to close the plans altogether would give the city a lot of flexibility.

Also, if the alternative is a property tax hike, would we not have to approve that by referendum? If voters won't approve a sales tax that doesn't kick in for 15 years, I don't see them approving a property tax increase that takes effect right now. I may be completely ignorant on how property taxes are set.

[camarocane]

The text of the referendum calls for closing "up to three" of the city's underfunded defined benefit retirement plans, AND increasing the employee contribution for each of those plans to a "minimum of 10 percent." How is that "all tax, no reform?"

I'm not trying to be confrontational, I'm just asking. I don't yet know if I will vote yes or no because it's so hard to get the straight dope from anyone.

It seems to me that requiring a 10% employee contribution would be a MASSIVE transfer of the burden from the taxpayers to the city employees who enjoy the gold-plated retirement plans, because I can't imagine a world where they are paying anything close to that now. It also seems like the option to close the plans altogether would give the city a lot of flexibility.

Also, if the alternative is a property tax hike, would we not have to approve that by referendum? If voters won't approve a sales tax that doesn't kick in for 15 years, I don't see them approving a property tax increase that takes effect right now. I may be completely ignorant on how property taxes are set.

I don't believe the Police and Fire will see an increase as they are already at 10%, everyone else in the GEPP will be increased from 8% to 10%.  Funny thing is, the police and fire are both severely underfunded and the crux of the problem, the GEPP is in a better state.

Regardless, this will all need to be vetted by the unions.
What happens if the referendum passes, police/fire unions agree to the plan and every other union does not? Without the additional contribution from the police and fire (remember they will not be contributing anymore, as they are currently at the 10%) how will that impact Curry's plan?

[vicupstate]

A property tax increase could be approved by a simple majority vote of city council at any time, provided Curry didn't veto it, or by a super majority (13? of 19) if he did. 

Does the Sales Tax NOT go into effect IF the unions don't agree to the higher (10%) contribution? Given the wording, an increase BEYOND 10% for Police and Fire is at least a possibility, but that is the case whether this passes or not.

[Josh]

A property tax increase could be approved by a simple majority vote of city council at any time, provided Curry didn't veto it, or by a super majority (13? of 19) if he did. 

Does the Sales Tax NOT go into effect IF the unions don't agree to the higher (10%) contribution? Given the wording, an increase BEYOND 10% for Police and Fire is at least a possibility, but that is the case whether this passes or not.

They don't get access to the funds raised by the tax.

I don't understand why Curry keeps saying the state won't allow any city to raise taxes. Didn't SJC literally just do exactly that to increase revenue for their school district?

[vicupstate]

I don't understand why Curry keeps saying the state won't allow any city to raise taxes. Didn't SJC literally just do exactly that to increase revenue for their school district?

Increases in SALES taxes require voter approval. Property tax increases do not. Did SJC approve a property tax increase or a sales tax increase or simply vote to put a Sales Tax increase on the ballot?   

[jaxlongtimer]

JB Tripper, see the below that I posted on the "law suit" thread previously.  It shows the many options available to raise the needed funds without using this referendum's sales tax.  The quote from the Mayor taken from the article and posted below is the only reason for this referendum.  As such, this is a self inflicted problem leading me to having a hard time supporting the sales tax solution.  I am leaning toward voting "no."

This is a great graphic from the T-U that shows how easy it would be to pay the current pension obligations now, not decades down the road at far more costs.

Curry flatly rejects raising property taxes or any other existing taxes or fees.

http://jacksonville.com/news/metro/2016-08-09/story/if-sales-tax-fails-other-solutions-will-have-be-found-jacksonvilles

[Josh]

I don't understand why Curry keeps saying the state won't allow any city to raise taxes. Didn't SJC literally just do exactly that to increase revenue for their school district?

Increases in SALES taxes require voter approval. Property tax increases do not. Did SJC approve a property tax increase or a sales tax increase or simply vote to put a Sales Tax increase on the ballot?

It was a sales tax increase passed by voter referendum. Curry makes it sound like getting a referendum on a ballot to increase any tax in Florida is like going to Mars.

[mtraininjax]

Refreshing to see that this is not just a Jacksonville problem, but a $6 Trillion problem throughout the country....

http://www.marketwatch.com/story/why-your-states-public-pension-plan-is-in-a-much-bigger-hole-than-you-already-fear-2016-08-16

U.S. state and local employee pension plans are in trouble — and much of it is because of flaws in the actuarial science used to manage their finances. Making it worse, standard actuarial practice masks the true extent of the problem by ignoring the best financial science — which shows the plans are even more underfunded than taxpayers and plan beneficiaries have been told.

The bad news is we are facing a gap of $6 trillion in benefits already earned and not yet paid for, several times more than the official tally.

Pension actuaries estimate the cost, accumulating liabilities and required funding for pension plans based on longevity and numerous other factors that will affect benefit payments owed decades into the future. But today's actuarial model for calculating what a pension plan owes its current and future pensioners is ignoring the long-term market risk of investments (such as stocks, junk bonds, hedge funds and private equity). Rather, it counts "expected" (hoped for) returns on risky assets before they are earned and before their risk has been borne. Since market risk has a price — one that investors must pay to avoid and are paid to accept — failure to include it means official public pension liabilities and costs are understated.

If I had a pension, I'd be worried!

[Sunbeam]

REFORM BEFORE TAX!!!! is a must

Hidden inside the original legislation for the Better Jacksonville Plan is the ability for city council at any time to enact an additional 1/2 cent sales tax....for capital building.

Get ready for that!!!

There is NOTHING stopping our leadership from using that already approved sales tax right NOW for this pension problem. it just takes "leadership" .... which this city continually lacks.

Word has it that curry is in negotiations with khan to use that capital building tax for the shipyard property.

So what is actually being said by curry is to hell with taxpayers, to hell with an immediate solution, we WILL kick the can down the road to the next generation because my future political career is at stake

The city council which is supposed to be working for us are nothing but rubber stampers to the detriment of this community because they too have political visions of grandeur

there are better ways out of this and the 1/2 cent sales tax to start right now is the best cure we just need people with some guts to look out for this community

[Frustrated]

Many people are missing the most obvious objections.
1.  The Better Jacksonville Plan was sold by promising it would go away after 30 years.  We are only on year 15 and they already want to break that promise (as I knew they would 15 years ago).
2.  The Better Jacksonville Plan was sold as a way to get ahead of future traffic problems.  Remember that the next time it takes you over thirty minutes to get from Baymeadows to Emerson.
3.  The only people who benefited were the already overstuffed over paid lawyers sitting in that mausoleum we call a courthouse that they fought over for years.
4.  Don't even get me started on the new empty downtown library.  How much do taxpayers shell out to heat and cool that ridiculous entryway?
Politicians like Lenny, a supposed Republican (thought we were against tax hikes, and passing debt to our children) make lots of promises about what will happen, they did fifteen years ago. It is rarely what does happen.  Still waiting for my insurance costs to go down $2500 a year, but hey at least I can no longer AFFORD to go to the doctor.