Two: Don't Make Financial Promises Taxpayers Can't Keep
Florida’s state and local elected officials have been gambling with taxpayer dollars. They continue supporting financially unsustainable programs, like our current public pension plan and Citizens Property Insurance, because they don't want to tell us a truth we may not like hearing – these programs are financially unsound.
Require that all new state and local government employees be enrolled in 401(k)-style, defined contribution retirement plans.
Our politicians must stop making promises that taxpayers can’t afford. We must force them to be honest with us, and make decisions that will protect us now and in the future. We need an honest, transparent retirement plan that works for both hardworking taxpayers and government workers, and we need a property insurance system that will protect our homes without jeopardizing our future financial security.
- Florida’s Retirement System (FRS) serves more than 1 million government employees, making it the fourth largest public pension program in the country. Source: James Madison Institute
- The FRS is 88% funded, assuming a 7.75% return on investment. Over the last 12 years, the fund has received an average return of 3.3%. Source: James Madison Institute
- Florida currently has an optional defined contribution plan, however only 16% of employees elect to be enrolled in it, versus the 84% in the pension plan. Source: James Madison Institute
- Public sector pension programs guarantee a rate of return that is 3 to 4 times higher than what private sector workers are able to earn. Source: The Heritage Foundation
- The State of Florida currently contributes $5.5 billion per year to the FRS, but would need to double that contribution to $11 billion a year for the fund to remain solvent. Source: James Madison Institute