Benefits October 10, 2003

S. Fla. Town Goes the DB Way

October 10, 2003 (PLANSPONSOR.com) - Even though many employers have dumped their defined benefit pensions in favor or a defined contribution program, one suburban Fort Lauderdale community has decided to go the other way.
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City commissioners in Lighthouse Point, Florida have set up a DB plan for their police officers and firefighters in place of their old DC plan, according to the South Florida Sun-Sentinel. Under the new plan, which officials said the employees had requested, the city will contribute 14.25% of salaries versus the 14% Lighthouse Point paid into the DC plan.

Officials said employees were nervous about declining balances in their DC accounts over the past several years because of the bear markets. “The uncertainty of the market and fluctuations have made them anxious in the last two years,” Mayor Fred Schorr told the newspaper. “They have been requesting pensions more in line with other county departments.”

Police officers and firefighters “are looking forward to that security later in life, so it’s nice to have that plan,” Police Chief Ross Licata said. “Now we have the complete package here. Before this plan, we would lose the best people to other departments with a defined benefit program. This puts us on an equal playing field with everyone else.”

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