Indian River County Finance Director Jason Brown said today a recent increase in state mandated employer contributions to the Florida State Retirement Fund will cost the County $1.7 million in the coming fiscal year.
According to Brown, a projected 1.1 percent increase in Indian River County’s taxable property values will raise an additional $700,000. But that will still leave the County Commission “challenged” to find an additional $1 million to pay for increased pension contributions.
In the current fiscal year, the County Commission chose to draw on some $1.8 million in reserves, rather than raising the property tax rate. Asked if the County can find an additional $1 million in spending cuts Brown said, “It is going to be a bit of a challenge.”
The message being heard from counties around the state is that they will be forced to raise taxes. Indian River County may have no choice but to raise its millage rate, as well, though Brown said the County Commission remains committed to not increasing the County’s tax rate.
The Indian River School District will also be impacted by the new law. Combined, the state’s 67 school districts will have to kick in an additional $300 million over their current contributions to the state retirement fund. Indian River County School District Finance Director Carter Morrison could not be reached for comment today. But Brown confirmed the impact of the new law will be significant for the School District as well as for County government.
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Pension bill stuns counties, could force tax increases
By Bil Varian and Michael Van Sickler Times/Herald Tallahassee Bureau
TALLAHASSEE — A bill passed in the waning moments of the 2013 legislative session with little discussion and signed two weeks later by Gov. Rick Scott will cost state and local governments nearly $900 million in additional expenses next year, hitting county governments especially hard as they struggle to emerge from a prolonged economic slump.
The bill, SB 1810, raised the rates employers must pay into Florida’s $135 billion pension fund so that the state could more aggressively manage a deficit in the retirement system. Though the higher level will please conservatives like Scott who want the pension fully funded, it comes at a cost that some say is unnecessary when the stock market is hitting record highs.
The new rates will force 1,000 state, county and local employers to pay more into the system: $177 million from state agencies, $100 million from universities and colleges, $300 million from school districts, $50 million from cities and special districts, and $264 million from Florida’s 67 counties.
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