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6 posts from February 15, 2013

February 15, 2013

Report says Weatherford's pension reform might cost more

He’s called Florida’s pension system a “ticking time bomb” that will require a costly taxpayer bailout in the future.

But Florida House Speaker Will Weatherford’s aim to reform Florida’s current $136 billion pension plan, which has 145,000 member accounts, hinges on one key question. If you reform it, how much will it cost?

Plenty, says a 50-page study that was released late Friday. The study was done by Milliman, a Vienna, VA firm that is among the world’s largest providers of actuarial services.  Weatherford asked the Department of Management Services to study the financial impact of closing the pension plan to new members effective Jan. 1, 2014

The study looked at what happens when new employees working for the state, school districts, counties, cities and community colleges would be required to enroll in a 401-k plan rather than the current pension that provides guaranteed benefits. Members who are currently enrolled in the state pension plan would be allowed to remain.

But the findings seem to undercut Weatherford’s assertion that reform doesn’t threaten the benefits of those currently enrolled in the system.

Earlier in the week, Weatherford said those in the pension plan will be protected from having to pay higher contribution rates.

“I think that we can protect the current benefits that people have,” Weatherford said. “This is not going to change any teacher, state employee’s pension that is in the system today. In fact, it will preserve it.”

The report states, however, that because future members couldn’t join the pension plan, that plan would rely on a shrinking payroll base on which contributions to retirees are made. This would require the contribution rates to increase as a share of payroll.  

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Joe Martinez says he'll challenge Joe Garcia

Joe Martinez, the former Miami-Dade Commission chairman who lost his bid to become county mayor last year, said Friday that he intends to run against Congressman Joe Garcia in 2014.

"I'm meeting with different people and feeling them out, seeing what the level of support will be there," Martinez told The Miami Herald shortly after announcing his intentions on Facebook. He wants to get in the race, Martinez said, "to shake it up."

Martinez's name has been floated in political circles in connection with the 26th Congressional district since Garcia, a Democrat, defeated incumbent Republican Rep. David Rivera in November. The district extends from Kendall to Key West.

Martinez, a Republican, said he sees himself as a pragmatist in tune with residents' needs after his 12 years on the County Commission, including two terms as chairman. In his first term, former Mayor Carlos Alvarez campaigned for a strong-mayor referendum. In his second, Alvarez was recalled. Both times, Martinez said, he helped lead the county. "It actually ran really smoothly," Martinez said.

He gave up his seat last year to unsuccessfully challenge Mayor Carlos Gimenez. Martinez said Friday that he has since opened a public relations and business development consulting firm.

Garcia's chief of staff, Jeffrey Garcia (no relation), said from D.C. that the congressman "is focused on doing the work that the people sent him here to do."

"There'll be plenty of time for politics later," he added.

Martinez, conceding that "it's too early to tell" how well Garcia will do as a freshman congressman, said he's committed to running in two years.

"I've survived Miami-Dade politics," he said. "What's Washington?"

Despite last year’s promises, Florida Polytechnic asking for more cash

One of the biggest selling points Sen. JD Alexander made as he pushed to create a new state university last year is that it would cost little to no extra money initially. He told everyone that the tax dollars already allocated for what was then University of South Florida-Polytechnic and is now Florida Polytechnic University would be enough get the new school up and running.

Already, the school is singing a new tune. The Polytechnic Board of Trustees recently decided to ask the Legislature for an extra $25 million to finish its first building, first reported in the Lakeland Ledger.

That has Rep. Mike Fasano, the New Port Richey Republican who along with Alexander was term-limited from the Senate last year, fuming. Last year, Fasano voiced concern about how much the new school would cost. Now he is trying hard not to say, "I told you so."

“The bottom line here is that we were not told the truth,” Fasano said today. “And that this boondoggle, a 12th university, will cost the taxpayers hundreds of millions of dollars for years to come. A university that was not needed and was all to accommodate one state senator.”

On Feb. 5, the Florida Poly Board of Trustees agreed to ask the Legislature to aid with construction costs, the Ledger reported. The operating dollars the school already receives, $22 million a year, should be used strictly for academics, the board decided.

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Miami-Dade mayor says he has 'no interest' in county owning 'any part' of Dolphins stadium

Miami-Dade Mayor Carlos Gimenez, who plans to begin negotiations with the Miami Dolphins next week over the team's proposed stadium renovations, told sports-talk radio that he is not eager to have the county take ownership of Sun Life Stadium.

"I really don't like to negotiate in public, but I'll tell you this: I have no particular interest in owning any part of the stadium," Gimenez said Friday morning on Joe Rose's morning show on WQAM-AM (560). (Listen to the interview here.)

There has been talk behind the scenes that a potential deal could give Miami-Dade ownership of the stadium, which sits on county land but belongs to the Dolphins. That arrangement would no longer require the team to pay property taxes on the facility, and would require the county to provide an operating subsidy to the team. A similar agreement exists between the Miami Heat and the county-owned AmericanAirlines Arena.

Speaking to Rose, Gimenez didn't dwell on the ownership question, saying the county is still gathering information before negotiating in earnest.

So far, the mayor and the Dolphins have agreed that any potential deal will go to the voters in a special election. That referendum could take place on May 7 or May 14, former state Rep. Marcelo Llorente, a Dolphins lobbyist and Gimenez supporter, told Spanish-language radio station WQBA-AM (1140) on Friday morning.

The mayor told Rose that he wants the Dolphins to commit to privately funding more than 51 percent of the $400 million stadium improvements, as team owner Stephen Ross has pledged.

And he had quite a few things to say about the Miami Marlins. 

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After series of scandals, Citizens moves to become more like a state agency

After a series of corporate scandals, Citizens Property Insurance Corp. is hoping to conduct itself less like a high-flying private insurance firm and more like a government agency.

Blasted by regulators, investigators and lawmakers for lavish spending on travel and meals and poorly negotiated contracts, Citizens has agreed to remake parts of its operation using government as a model.

The state-run insurer of 1.3 million policyholders announced Friday that it will begin to implement procurement policies and travel guidelines that mirror those used by other state agencies. The Office of Insurance Regulation rapped Citizens last month for de-emphasizing price negotiation as it gave out $604 million in contracts to private companies. As a quasi-governmental entity, Citizens has operated under separate rules from most of Florida's government.

Also on Friday, Gov. Rick Scott’s chief inspector general released a final report on the company’s spending on travel and meals. As part of the report, Citizens agreed to adopt travel policies that “more closely mirror” those that govern state employees.

 “Citizens is aggressively looking for ways to tighten its financial belt,” said Citizens President/CEO and Executive Director Barry Gilway, in a statement.

Citizens has long insisted that it is not a government agency and should not be held to state limits on travel and food spending. Auditors have questioned Citizens’ rationale for this position since 2006, but the company ignored those concerns. Last year, the Herald/Times documented how Citizens’ loosely defined travel policies have allowed executives to charge the company hundreds of thousands of dollars for luxury hotel stays, limousine rides and expensive dinners.

As late as December, Citizens executives were arguing that the company—which received $715 million from taxpayers, has the ability to levy “hurricane taxes,” and claims governmental immunity in court—was not bound to rules governing state agencies. After Scott’s inspector general drafted a scathing report, Citizens agreed to follow the state’s travel rules, which would ban many of the luxurious expenses company execs have become accustomed to.

Some of the expenses flagged by reporters and inspectors include:

- More than $1,000 for a limousine ride and personal chauffeurs/car service for Citizens’ interim president and CFO.

-$236 for six-hour “day-use” of a hotel in Zurich, Switzerland, for the company CFO.

-$454,000 for “car expenses” between January and August 2012.

-$539 per night hotel stay in New York for top officials

The company offered explanations for many of the expenditures in a response to the inspector general report but agreed that stricter policies were necessary.

Meanwhile, the company has pushed to raise rates on homeowners and slash their coverage.

Citizens has also faced scrutiny over allegations of misconduct among its top executives, some of who later resigned and got large severance packages.

After Herald/Times stories about Citizens move to fire four investigators who were looking into the allegations, Scott called on his inspector to probe the company again.

That probe is ongoing, but some lawmakers are already pushing for more scrutiny.

Bills filed in the Legislature and backed by Scott would define Citizens as a state agency for the purposes of having an independent Inspector General. Citizens is supporting the proposal.

“According to reports in The Miami Herald late last year, an internal audit brought to light issues at this company charged with being stewards of public funds,” said David Richardson, D-Miami Beach. “The firing of four auditors who were responsible for reporting these indiscretions and completely disbanding the Office of Corporate Integrity has led me to believe that officials at Citizens may think they can operate without accountability, which I find appalling.”


Republican "savior?" National Journal goes with "player" profile of Marco Rubio

Time magazine called Florida Sen. Marco Rubio the "Republican Savior." The National Journal (and former Miami Herald reporter Beth Reinhard) sees him in a more calculating light as "The Player" in this (as-yet) most-thorough single piece written about the Republican:

The freshman senator from Florida had joined four veteran colleagues to unveil a proposal for the first major overhaul of immigration law in a quarter-century. Sen. John McCain, R-Ariz., introduced “my friend, Senator [Marco] Rubio, who obviously is a new but incredibly important voice in this whole issue of immigration reform.”

Two weeks earlier, Rubio had laid out a similar set of principles in an exclusive interview with The Wall Street Journal under the headline, “Marco Rubio: Riding to the Immigration Rescue.” The article came as a surprise to McCain and other members of the bipartisan group of senators who had been sketching out an immigration plan with and without Rubio for weeks. The blueprint was inspired by legislation that McCain first spearheaded in 2005.

The dig was subtle, but Rubio didn’t let it go. “I am clearly new to this issue in terms of the Senate. I am not new in terms of my life,” noted the Cuban-American senator from West Miami. “I live surrounded by immigrants. My neighbors are immigrants. My family is immigrants. Married into a family of immigrants.”

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