Mayor Alvin Brown filed the latest version of pension reform Wednesday, ensuring it will land on the agenda of next Tuesday’s City Council meeting.
Brown did not ask City Council to fast-track its consideration of the pension bill. The earliest it could come up for a final vote after moving through council committees would be the Feb. 24 council meeting.
That would come after City Councilman Johnny Gaffney steps down from council because he resigned to run for the state Legislature. His last day as a council member will be Feb. 17.
City Council voted 16-3 in December for its version of pension reform. The Police and Fire Pension Fund board agreed to most but not all of that legislation. The board’s counter-offers are part of the legislation filed Wednesday.
City Council President Clay Yarborough said he expects the council will make some amendments to the bill.
He said the three biggest elements are the interest rate that current police and firefighters would get on Deferred Retirement Option Program accounts, the cost-of-living adjustments they will get on their pensions, and whether City Council would agree to a term of longer than three years before being able to further change pension benefits for current workers.
The existing agreement between the Police and Fire Pension Fund runs through 2030. After that point, negotiation of pension benefits would be done through collective bargaining between the city and unions, and City Council could impose benefit changes if there is an impasse in those labor talks.
The Police and Fire Pension Fund agreed to let that process happen in 10 years. The pension bill approved by the council set a three-year limit, which council members said complies with the three-year length of collective bargaining agreements under state law.
Yarborough said he thinks the City Council and pension fund are close to reaching agreement on the DROP and COLA benefits. But he said there’s no question of how long the agreement should be.
“The law says it needs to be three years,” Yarborough said. “That’s the position I hold. It should follow what the law says.”
The pension fund and the city’s Office of General Counsel say the collective bargaining law doesn’t apply because the negotiations between the pension fund and the city haven’t been collective bargaining.
However, a Duval County court found the pension fund engaged in collective bargaining with the city in 2013 and the 1st District Court of Appeal upheld that finding in a Government in the Sunshine lawsuit filed by Times-Union Editor Frank Denton.
Chris Hand, chief of staff for Brown, said city lawyers will give their advice to City Council about why the 10-year term is legal.
“We’re going to lean on them to answer those types of questions, and I’m sure they’ll be prepared to do so,” Hand said.
While the City Council takes up the pension bill, a newly formed special City Council committee will be examining the city’s current agreement with JEA outlining the utility’s yearly contribution to the city, which expires in 2016, and making recommendations for what the new agreement should include.
Brown has proposed partnering with JEA to help fund the increased contribution the city would make to pay down its $1.62 billion debt to the police and fire pension fund, a significant part of his pension reform package.
Under that plan, the city and JEA would borrow a total of $240 million. In return, the city would agree to reduce the utility’s annual payment to the city’s general fund, along with other financial and administrative concessions.
Council President Clay Yarborough said he believes the city’s future contributions from JEA should be decided independently of achieving pension reform.
Yarborough said he’s still open to considering a pension reform bill that would change JEA’s contribution; but that he isn’t convinced it’s in the best financial interest of the city.
“I support the separate look,” Yarborough said. “I think that’s a big issue. We don’t want that tangled up in pension reform.”
Yarborough said the committee won't be making a recommendation on the funding portion of the pension plan that involves JEA.
Councilman Bill Gulliford, who will chair the special committee, said the committee will first examine the current funding agreement before making recommendations on the new agreement.
Chris Hand, Brown’s Chief of Staff, said he respects Yarborough’s decision to form the special committee and that it would be a “good opportunity” to review the JEA portion of the pension reform agreement.
The committee’s deadline to make a recommendation is April 30.
david.bauerlein@jacksonville.com: (904) 359-4581
christopher.hong@jacksonville.com: (904) 359-4272
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