INDIAN RIVER COUNTY — Budget Director Jason Brown told the Board of County Commissioners Tuesday that Gov. Rick Scott’s proposal for government employees to pay more into the state retirement fund will end up costing the county money in the long run.
Scott has proposed that workers begin to pay 5 percent of their salary to help fund their retirement benefits and Brown’s office has estimated that would amount to about $2.4 million in savings for the county.
“Initially we thought that would help the county to balance its budget,” he said.
However, tucked away at the end of the 213-page proposal was the requirement that any money the county saves from the employee contributions be returned to the state to help cover its budget gap. Under the proposal the state would recoup its savings by holding back the estimated $2.5 million in revenue sharing from the 6-cent state sales tax paid into the county’s general fund.County employees are paid out of and will pay their benefits into various county accounts. Those accounts will be affected unevenly as the hit the county will take with the loss of the sales tax revenue is in the general fund. Brown said money can’t be moved back and forth to even out the discrepancies. Overall he estimates the county will lose just over $100,000 in revenue from the state under Scott’s plan.
“We’ve balanced our budget here, we have written our tax rolls down, decreased our work force by 24 percent, we are dealing with the change in the tax rolls from the recession,” Brown told the Commissioners. “We are just hoping the state doesn’t take the opportunity to balance the state budget on the backs of county and local governments. I don’t think it is inappropriate for employees to contribute to their pensions, but shouldn’t the county receive those savings?”
The budget director also pointed out that the Senate has a proposal that would require workers to pay 2 percent toward their retirement package that does not ask for the savings to be passed back to the state. The proposal would generate a savings of about $1.1 million for the county.
The state House of Representatives has yet to put forth a proposal on employee contributions.
Commissioner Gary Wheeler said he was in favor of a compromise on how the revenue is allocated, but that ultimately savings are savings.
“The problem is right now everybody is trying to protect their own sandbox,” he said. “What we need to do is all get in the sandbox together and figure out what we have to do to help each other and make it work.”