Firefighters Fund Challenges Benefit Changes

January 23, 2012 ( – The Board of Trustees of the City of Hollywood (Florida) Firefighters’ Pension System filed a complaint challenging changes to system benefits.

The trustees are asking a court in Broward County to find that the ordinance making the changes is invalid because it was not approved by the City Commission or submitted to city voters in compliance with governing law.  

According to the complaint, the ordinance freezes the current benefit structure as of September 30, 2011, and implements a new structure “designed to lower substantially the benefits to members subsequent to October 1, 2011, from those to which the members were entitled prior to that date.” The ordinance makes changes to how monthly remuneration and average final compensation are to be calculated for members.  

The ordinance also delays the normal retirement date, eliminates cost of living adjustments for benefits going forward and eliminates a deferred option retirement plan (DROP), which allows members to continue employment after their retirement date and defer retirement benefits into an income-producing account.  

In addition, the ordinance eliminates as a future source of pension system funding an excise tax set up under Florida law.  

In addition to declaring the ordinance invalid, the trustees are asking the court to issue a permanent injunction prohibiting implementation of the ordinance and reinstate the pension system, providing all benefits as they existed prior to September 30, 2011.