Our Pension Plan Designed to Weather Stock Market Changes
Our pension plan members should not panic over the recent dramatic drop in the stock market. Your pension assets are invested in a balanced portfolio designed to minimize drastic downturns in the market, while spreading risk over many different types of asset classes. We have invested in asset classes that rise as the stock market declines. Some are calling this a correction, while others say it is a reaction to the coronavirus. We are in daily communications with the professionals who monitor our portfolio and are confident our asset allocation will withstand this short-term market disturbance. Over the past 29 years, our plan had an average return of 8.57% on investments. The trustees are confident in our investment strategy, which is designed for the long-term sustainability of our guaranteed pension benefits. Kenneth Rudominer, Chairman, Board of Trustees Read More
Congress Passes Legislation to Establish Presumptive Benefit for Covid-19
Legislation to ensure fire fighters who die or are permanently and totally disabled due to COVID-19 receive full federal benefits passed the U.S. House of Representatives unanimously on July 20 and was sent to the president on August 4 for his signature. The bill, S 3607, the Safeguarding America’s First Responders (SAFR) Act of 2020 would establish a presumptive benefit under the Public Safety Officer Benefit (PSOB) program for public safety officers who contract COVID-19 Read More
Recession Rocks State and Local Pensions, ‘Funding Gap’ Possible
The economic shutdown caused by the coronavirus will result in a steep drop in tax revenue for state and local governments, forcing them to make difficult decisions about how to fund the state pension systems their employees rely on for their retirement. Pensions are largely funded from three sources: investment returns, employer mandated contributions on behalf of the workers, and employees who give a portion of their salaries. Read More
The City of Fort Lauderdale is the sponsor of the Fort Lauderdale Police and Firefighters’ Retirement System. All Fort Lauderdale sworn police officers and firefighters are eligible to participate in the plan. A seven-member Board of Trustees, who are either elected by the employees or appointed by the Mayor, administers the pension plan. The plan is a defined benefit plan that promises to pay a guaranteed benefit at retirement.
- 793 – Active members
- 1,167 – Retired members and beneficiaries
- 1,930 – TOTAL PLAN PARTICIPANTS
FUNDING Public safety officers contribute 10% of earnings into the pension plan. Members also pay 7.65% of earnings into Social Security and Medicare. Additional revenue to the pension plan comes from the State of Florida insurance premium tax, the City of Fort Lauderdale, and earnings generated on the invested assets. The plan’s investment returns provide 67% of the plan’s funding. Over the past 28 years, the plan had an average total return of 8.75% – greater than the assumed 7.4% rate of return.
BENEFITS Retirement benefits are based on (1) average final earnings, (2) years of service, and (3) a benefit formula. Public safety officers can retire after 20 years of creditable service (or after 10 years at age 55). Overtime and unused leave do not increase retirement benefits. After 20 years of service, public safety officers are eligible to receive a retirement benefit equaling 60% of their monthly earnings. Retirement benefits are not automatically adjusted annually for cost of living changes. Retirees have not received a COLA since 2001.
DISABILITY Service-related disability benefits provided by the plan cannot exceed 65% of current monthly earnings. Non-service benefits cannot exceed 50% of monthly earnings, with reductions for Social Security benefits, Workers Compensation, or other earned income. The Fort Lauderdale Police and Firefighters’ Retirement System was established by City Ordinance and became effective January 3, 1973. As of 9-30-2019, the pension fund assets totaled $927 million.
For more information, see the Annual Report Newsletter