On Air Now

Listen Now

Weather

cloudy-day
77°
Sct Thunderstorms
H 82° L 74°
  • cloudy-day
    77°
    Current Conditions
    Sct Thunderstorms. H 82° L 74°
  • partly-cloudy-tstorms-day
    82°
    Afternoon
    Sct Thunderstorms. H 82° L 74°
  • cloudy-day
    80°
    Evening
    Cloudy. H 82° L 74°
Listen
Pause
Error

The latest top stories

00:00 | 00:00

Listen
Pause
Error

The latest traffic report

00:00 | 00:00

Listen
Pause
Error

The latest forecast

00:00 | 00:00

Local
Jacksonville Mayor’s pension reform proposal projects $1.4B initial savings
Close

Jacksonville Mayor’s pension reform proposal projects $1.4B initial savings

Jacksonville Mayor’s pension reform proposal projects $1.4B initial savings
Jacksonville Mayor Lenny Curry presents details of his pension reform plan to the City Council.

Jacksonville Mayor’s pension reform proposal projects $1.4B initial savings

It’s a matter of paying $208 million toward pension obligations next year, or $349 million.

Not only do top officials in Jacksonville say their pension reform plan would mean big immediate savings, but they project a $1.4 billion impact over the next 14 years.

“They [reform plans] represent a historical change for our City, and they mark a new beginning for financial health of Jacksonville,” says Jacksonville Mayor Lenny Curry.

Curry and his senior staff started their big pension reform pitch to City Council Thursday with a nearly two hour presentation that- for the first time- included publicly releasing some of the financial details on anticipated costs and savings for their long fought reform plan. While the City Council signed on to the broad concept when they cleared a sales tax to be put up to a referendum, now is their first chance to dig in to details and approve collective bargaining agreements as well.

The history

Curry vowed from the campaign trail to put forward a pension reform plan, and in January 2016 he introduced the concept of extending the half-cent Better Jacksonville Plan sales tax- which expires by 2030- through 2060, and using the proceeds to pay down the City’s unfunded liability, or pension debt. That debt currently stands at around $2.86 billion, with all unions considered. The Police and Fire Pension Fund holds the main share, at $1.8 billion.

The State and City Council cleared the concept, and then Jacksonville voters approved the sales tax in August. Since then, the Administration has been working on collective bargaining, because they needed to close out traditional pensions in order to access the sales tax. 

“The reform package you are reviewing ends those outdated, unsustainable, legacy pension systems that are bankrupting and crippling cities all over the United States,” Curry says.

That bargaining has resulted in new agreements, which are now in front of the Council, along with the mechanics of the sales tax.

The plan

While Mayor Curry gave an opening statement, most of the leg work today came from his Chief Administrative Officer Sam Mousa and Finance Director Mike Weinstein, who went page-by-page through a proposal detailing the goals, historical data, and current projections.

To put it simply, Mousa says it’s time to make expenses match with revenue, and enact comprehensive reform for the health of the City now and in the future. Their plan offers a dedicated revenue stream, in the form of the sales tax, while also including some safeguards to ensure the plans themselves are sustainable.

Over the next 14 years, the Administration says their reform plan will save $1.4 billion. Next year alone, the projected City contribution toward all pensions could fall from the $290 million paid this year to $208 million, or could increase to $349 million if nothing changes. This is done in large part through a 30 year re-amortization that reduces the annual required contribution in the near future, freeing up more money to be used for other City services. 

Close

Jacksonville's overall pension contribution

Based on the slides presented to the City Council, through Fiscal Year 2050, the reform agreement actually costs about $256 million more, because much of the immediate burden is shifted to later years. 

“You can’t pay off a $2.85 billion dollar invoice, without feeling it in some way,” Weinstein says.

A projection through the entire possible length of the sales tax, FY 2060, was not immediately provided.

While the plan appears to cost more with the bottom line over time, shifting the burden to later years is projected to mean the sum will actually have a smaller impact on the budget overall. In other words, paying the required amount now would be a large portion of the budget- eating up money otherwise used for things like public safety. Shifting that to future years, when the budget in itself is larger because of a projected increase in property tax revenue and other factors, makes the proportional burden less.

Sales tax revenue

The half-cent sales tax is currently projected to bring in about $9 billion, if used for its entire 30 year life, with an assumed growth rate of 4.25%. Mousa says they anticipate having all of the pensions fully funded by FY 2050 or 2051. If the final year the sales tax is collected is FY 2050, then the projected revenue from the tax is a little over $4.7 billion, according to the Administration’s figures. Mousa says the City Council will annually reassess the projection and is able to adjust the value as they see appropriate. Because the Administration expects to pay the debt down ahead of time, though, he believes lowering the value of the projected tax would lengthen the timeline to pay down, as opposed to putting the City in any financial trouble.

“We know this will cover it, we know we have a game plan here that’s going to fix it once and for all,” Mousa says.

The sales tax is allocated proportionally to the pension funds based on the size of the debt. So, for example, PFPF makes up $1.801 billion of the $2.861 overall pension debt, and therefore, gets 63% of the sales tax. If, at any time, one of the pension plans is fully funded, then the sales tax would be split proportionally between the remaining two.

Close

Half-cent sales tax distribution

The tax can only be used to pay down the pension debt, by law.

Collective bargaining

There are twenty-two collective bargaining units under three larger umbrellas- Police/Fire, Corrections, and General Employees- that had to agree to the new proposed benefits and pay. While those collective bargaining agreements are still pending a City Council vote, that is an up-or-down vote, not something that can be amended. The bargaining agreements include pay raises and a one-time bonus, as well as the restoration of some benefits cut under a 2015 reform plan specifically for Police and Fire. New hires will also be moved to a new 401(k)-style plan, rather than the current defined benefit model, and existing employees are increasing their contribution to their plans.

Collective bargaining is required every three years, but as Mousa explains it, there are “triggers” built in to facilitate that process. One trigger deals with the annual growth rate for property taxes and the other is about how the return on investment matches up to the actuarial assumed rate. When the collective bargaining happens after the first three years of this agreement, Mousa says if both of the triggers are “in the green”- or the conditions are met- then things will proceed as they are. If one of the triggers goes “in the red”, then that forces a new dialogue. The current agreement would have three three-year periods and a final single year, with a session at the bargaining table in between each.

The pay raises were an area of focus in regard to their impact on the bottom line. Weinstein says the money is essentially already available to cover the one-time payments, which would total around $10.7 million. That funding would come largely from money previously set aside to help with collective bargaining. With the raises that take effect over the next three years, the total builds, but he says it can be covered.

The projected cost of the pay raises in FY 2018 is $37 million, but the City is expected to save $90 million through the reform plan. The following year’s cost is $77 million, with a $91 million savings. In all, that’s a net difference of $67 million. Weinstein says if the City is smart and saves that, it can be used toward FY 2020, when the cost of pay raises actually exceeds the savings, $120 million to $82 million respectively. If the prior savings are applied, the City is still ahead $29 million over the three years.

Close

Paying for raises under Jacksonville's pension reform plan

There are no figures on potential raises more than three years out, because that would be subject to collective bargaining.

Safety nets

In order to help ensure the fiscal stability of the funds, the Administration has built in three “safety nets”. The first is a liquidity floor of five years, which essentially means that the funds will always have enough cash to payout five years of benefits, even if no new money comes in. The Administration’s current projections have all of the funds above that floor, although the PFPF gets close after about FY 2031. If any fund falls below the floor, the City would be required to pay more in to it.

City contribution overall is the second safety net, with the deal requiring an annual minimum contribution of $110 million to PFPF, $60 million to General Employees, and $10 million to Corrections. Even if the required City contribution falls below that amount, the City will pay at least this sum annually in order to continue to work toward fully funding the plans.

The third safety net is the annual review by City Council of the sales tax growth assumption, as previously mentioned.

City Council

Approval by the Jacksonville City Council is the final hurdle to get this process in place. 

Thursday’s workshop was the first of several specially designated gatherings, with another workshop planned for April 12th and a possible Council Committee of the Whole meeting slated for April 19th. The bills are up for a second reading April 11th, and will also be subject to public hearing at that time. Additionally, Mousa and Weinstein have meetings set with each Council member individually to work through their questions and concerns.

A few of those questions started to get aired out Thursday. Some wanted projections beyond FY 2050, which weren’t included in the slides, and the Administration said they would provide that. One questioned the potential impact of future negotiated pay increases for employees beyond this first three year stretch, and the answer was that it was difficult to say because of future collective bargaining. Related to that, a Councilwoman had concerns about the collective bargaining triggers being based on financial data from prior years, without consideration for future economic projections. Another asked whether the City’s ratings agencies had given any thought to the proposal, and, overall, it’s being viewed as positive to address the pension issue, although they don’t comment on specific proposals until they’re enacted.

Despite these questions, many spoke in praise of the Administration for crafting the proposal and laying it out as they did, calling the proposal a creative solution.

Read More

The Latest News Headlines

  • A South Carolina soldier has died in Afghanistan, WPDE reported. The U.S. Department of Defense announced Thursday that 25-year-old 1st Lt. Trevarius Ravon Bowman of Spartanburg died May 19 at Bagram Air Force Base. He died in a non-combat-related incident. A department news release said the incident is under investigation but didn’t provide details. Bowman was in Afghanistan supporting Operation Freedom’s Sentinel. He was assigned to a unit attached to the 228th Theater Tactical Signal Brigade of the South Carolina National Guard. “It is with heavy hearts and deepest condolences that we announce the passing of 1st Lt. Trevarius Bowman. This is never an outcome we as soldiers, leaders and family members wish to experience,” said U.S. Army Maj. Gen. Van McCarty, the adjutant general for South Carolina. “Please keep the service members in his unit in your thoughts and prayers, as well as his family as they work through this difficult time.”
  • More than 5.4 million people worldwide – including at least 1.6 million in the United States – have been infected with the new coronavirus, and the number of deaths from the outbreak continues to rise. While efforts to contain the COVID-19 outbreak continue, states have begun to shift their focus toward reopening their economies. The Centers for Disease Control and Prevention is tracking cases in the U.S. here. Live updates for Monday, May 25, continue below: ‘Person of interest’ identified in bias crimes against Asians in Seattle Update 3 a.m. EDT May 25: Police in Seattle are investigating a growing number of crimes targeting Asians during the outbreak. Seattle officers said the attacks started late Saturday afternoon in the heart of Ballard and moved to Golden Gardens Park. They believe one man is responsible for all the incidents. A victim at Golden Gardens Park said the man spat in his face. The workers at Thai Thani Restaurant said the man threw things at them while demanding to know if they are Chinese. “I hear some noise, and I see some guy angry, yelling,' Umboom Moore told Seattle’s KIRO-TV. That was the first time she knew something unusual was happening Saturday night at the restaurant where she works. “Just like some crazy guy,” she said. “So I just started taking pictures.” Her co-worker, Natthiya Chumdee, said he was yelling at her. “Right over there, he smashed the window,” she said. When he asked if she is Chinese, she told him everyone there is Thai. He asked her to kneel and swear to it. “Well, I’m not going to do that,” she said. “He’s starting [to] lose control. And he comes here, and he says, ‘You know, I’m going to slam the door, this table to you.’” The night before, Tonya McCabe got the brunt of his anger. “He said, ‘Are you Chinese?’” she said. “And I said, ‘No, we’re not.’ And he still kept yelling at us. And I said, ‘If you’re not going to leave, I’m going to call 911.’ And then he said, ‘Better [expletive] call 911.’” Just last week, a man was captured on camera shoving an Asian couple as they walked by. They told Seattle police he spat on them, too. The man in these latest attacks is described as white, 5 feet, 10 inches tall, in his mid-20s to mid-30s and is of a muscular build. He was wearing a white shirt and shorts. It is the same suspect description in two attacks at Golden Gardens Park on Saturday night. “I stand back there, and ... yell to him, ‘Get out, leave!’” said McCabe. It has McCabe and the others working at this restaurant finding a different way to get around this city that is now their home. “I’m afraid to like walk on the street or take a bus,” said McCabe. They told KIRO that the man also approached other Asian-owned businesses in the area before apparently heading to Golden Gardens Park. Anyone who recognizes him is asked to call Seattle police. 17-year-old Georgia boy becomes youngest in state to die from COVID-19 Update 2:24 a.m. EDT May 25: The Georgia Department of Public Health said Sunday that a 17-year-old boy has died of the coronavirus, marking the youngest fatality and first pediatric death in the state. Nancy Nydam with the department confirmed the information to Atlanta’s WSB-TV on Sunday. The teen was from Fulton County and had an underlying condition, according to officials. His identity has not been released. More than 1,800 people have died of COVID-19 in Georgia since the outbreak began, with the median age of deaths at 73.6 years old, according to the Georgia Emergency Management and Homeland Security Agency. According to the Centers for Disease Control and Prevention, cases of COVID-19 in children have typically been less severe, though there has been growing concern and a new warning about a rare condition recently seen in dozens of children nationwide. A spokesperson for Children’s Healthcare of Atlanta confirmed that a team of infectious disease and cardiology experts are evaluating several cases in metro Atlanta of children who exhibited Kawasaki-like symptoms and inflammation. Children’s Healthcare of Atlanta physician specialists stressed that it appears to be a rare finding with a low rate in Georgia. New York health officials have already issued a warning about a rare inflammatory syndrome that has infected at least 64 children in that state. A spokesperson for Children’s Healthcare of Atlanta said they have experts for treating the symptoms regardless of a potential link to COVID-19. Families should contact their doctor or visit an emergency room if their child develops signs of illness such as high fever, rash, red eyes, abdominal pain and swelling of the face, hands or feet. US coronavirus cases top 1.6M, deaths near 98K Published 12:43 a.m. EDT May 25: The number of novel coronavirus cases in the United States surged past 1.6 million early Monday across all 50 states, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands. According to a Johns Hopkins University tally, there are at least 1,643,238 confirmed U.S. cases of the virus, which have resulted in at least 97,720 deaths. The hardest-hit states remain New York, with 361,515 cases and 29,141 deaths, and New Jersey, with 154,154 cases and 11,138 deaths. Massachusetts, with 92,675 cases, has the third-highest number of deaths with 6,372, while Illinois has the third-highest number of cases with 110,304. Only 16 states and territories have confirmed fewer than 5,000 cases each. Seven other states have now confirmed at least 42,000 novel coronavirus cases each, including: • California: 94,020 cases, resulting in 3,754 deaths • Pennsylvania: 71,563 cases, resulting in 5,136 deaths • Texas: 55,861 cases, resulting in 1,528 deaths • Michigan: 54,679 cases, resulting in 5,228 deaths • Florida: 50,867 cases, resulting in 2,237 deaths • Maryland: 46,313 cases, resulting in 2,277 deaths • Georgia: 42,902 cases, resulting in 1,827 deaths Meanwhile, Connecticut has confirmed at least 40,468 cases; Louisiana, Virginia, Ohio and Indiana each has confirmed at least 31,000 cases; Colorado, North Carolina, Minnesota and Tennessee each has confirmed more than 20,000 cases; Washington, Iowa, Arizona and Wisconsin each has confirmed at least 15,000 cases; Alabama and Rhode Island each has confirmed more than 14,000 cases; Mississippi, Missouri and Nebraska each has confirmed at least 12,000 cases; South Carolina has confirmed at least 10,000 cases; Kansas, Delaware, Kentucky, Utah and the District of Columbia each has confirmed at least 8,000 cases, followed by Nevada with more than 7,000; New Mexico and Oklahoma each has confirmed at least 6,000 cases, followed by Arkansas with more than 5,000; South Dakota and New Hampshire each has confirmed at least 4,000 cases; and Oregon and Puerto Rico each has confirmed at least 3,000 cases. Click here to see CNN’s state-by-state breakdown.
  • The Republican National Committee and other conservative groups filed a lawsuit Sunday to stop California from mailing ballots to all voters ahead of the November general election. Gov. Gavin Newsom announced earlier this month that the state would mail all registered voters a ballot, while in-person voting would still remain an option, CNN reported. 'Democrats continue to use this pandemic as a ploy to implement their partisan election agenda, and Gov. Newsom's executive order is the latest direct assault on the integrity of our elections,' RNC Chairwoman Ronna McDaniel said in a statement, CNN reported. The lawsuit, filed by the RNC, the National Republican Congressional Committee and the California Republican Party challenges the expansion of absentee voting. '(It) violates eligible citizens' right to vote,' the lawsuit claims. '(And) invites fraud, coercion, theft, and otherwise illegitimate voting.' State officials stand by the move. “California will not force voters to choose between protecting their health and exercising their right to vote,” Secretary of State Alex Padilla said. “We are meeting our obligation to provide an accessible, secure and safe election this November. Sending every registered voter a ballot by mail is smart policy and absolutely the right thing to do during this COVID-19 pandemic.” The lawsuit is one of nearly a dozen across the country challenging Democrat-led vote-by-mail expansion. The RNC has pored $20 million into the nationwide legal effort, CNN reported. Some states, including Republican-heavy Utah, already conduct their elections completely by mail. There is no evidence of widespread voter fraud linked to voting-by-mail, CNN reported.
  • Thousands of convicted felons will be eligible to vote in Florida after a federal court ruled that a law that created wealth-based hurdles to voting is unconstitutional. The law, SB 7066, required people with past convictions to pay all outstanding legal fees, costs, fines and restitution before regaining their right to vote. The law undermined Floridians’ 2018 passage of Amendment 4, which restored voting rights to more than a million people who completed the terms of their sentence, including parole or probation. U.S. District Judge Robert Hinkle found that conditioning voting on payment of legal financial obligations a person is unable to pay violates the Equal Protection Clause of the 14th Amendment by discriminating on the basis of wealth. He said that requiring the payment of costs and fees violates the 24th Amendment, which prohibits poll taxes and violates the National Voter Registration Act. “This is a historic win for voting rights. Judge Hinkle told the state of Florida what the rest of America already knows. You can’t make wealth a prerequisite for voting. This ruling opens the way for hundreds of thousands of Floridians to exercise their fundamental right to vote this November, and our democracy will be stronger for their participation,' said Sean Morales-Doyle, senior counsel at the Brennan Center for Justice.
  • A temporary field hospital built for $21 million as the coronavirus outbreak threatened to overrun medical facilities in New York has closed without ever seeing a patient. Plans to transform the Brooklyn Cruise Terminal into a temporary 670-bed hospital were announced March 31, a day after the USNS Comfort hospital ship arrived to help coronavirus patients. Officials also announced a tennis center in Queens would be converted into a 350-bed facility. At that time, there were about 8,400 patients in hospitals citywide being treated for the coronavirus, The City reported. The tennis center opened as a medical facility April 11 when there were 12,184 patients in hospital beds being treated across the city. It cost $19.8 million to renovate and revert the tennis center. It closed earlier this month after taking in 79 patients. The Brooklyn hospital, built by SLSCO, a Texas-based construction company, was supposed to open in April but was not ready for patients until May 4, The City reported. By then, hospital use had been sliced in half, to about 6,000 patients. It closed last week without ever having a patient. The Federal Emergency Management Agency is expected to pay the costs for both hospitals. The two field hospitals were not the only emergency medical facilities in New York that saw limited use. The Comfort left New York after about a month and treating 182 patients, of which about 70% had the coronavirus. Several other field hospitals were built across New York for nearly $350 million. They closed in April without seeing any patients, The Associated Press reported. Built for worst-case scenarios, some of the unused facilities will be kept on stand by for a possible second wave. “As part of our hospital surge, we expanded capacity at a breakneck speed, ensuring our hospital infrastructure would be prepared to handle the very worst. We did so only with a single-minded focus: saving lives,” city spokesperson Avery Cohen told The New York Post. 'Over the past few months, social distancing, face coverings, and other precautionary measures have flattened the curve drastically, and we remain squarely focused on taking that progress even further.” The Associated Press contributed to this report.

The Latest News Videos