April 29. 2010. No changes to FRS, In lieu of tax increase and to balance budget, “legislature cut programs, provided no money for state worker pay raises, and injected another round of federal stimulus aid – over $2 billion – in the budget.”

[Received April 28]

Caution: We still do not have finalized language on conforming and implementing issues. While we expect the attached budget and the FEFP runs to remain the same, I would urge you to avoid making any firm decisions on this information until after Sine Die. Also, keep in mind the Governor has line item veto authority in the budget process.

For those who want to go straight to the documents:

· Here is the Conference Report on HB 5001, the appropriations bill (pages 1-47 contain the education sections):

· Here is the link for the FEFP Runs: http://myfloridahouse.gov/filestores/Adhoc/Appropriations/GAA/2010-House/fefp.pdf

· The final SUS Conference Report spreadsheet is attached [see April 28 UFF-FAU Post]

· The final Community College (State College) conference spreadsheet is coming soon.

Notes:

The House and Senate finalized the budget Monday shortly before midnight. There is still some work being done on the Conforming bill (language that provides spending directions and prescriptions). The $70.37 billion state budget was delivered to legislators’ desks Tuesday afternoon, in time for the constitutionally mandated three-day cooling off period before a vote on Friday, the last day of the 60-day session. Voting on the bill could begin at 3pm Friday afternoon.

To stave off tax increase and to balance the budget, the legislature cut programs, provided no money for state worker pay raises, and injected another round of federal stimulus aid – over $2 billion – in the budget. They also used over 400 million from the gambling deal with the Seminole Indian tribe and dug into state trust funds.

Some details:

· Per-student spending in the new budget will be very close to last year’s spending around $6,840 per student.

· There will not be any provision in the budget (or other bills) to create a task force to study ideas similar to Senate Bill 6.

· The bill requires voter approval for school districts to impose an optional property tax of 25 cents for $1,000 of assessed property value. The levy must be imposed to make the total potential funding projections.

Retirement:

· No employee contribution required. Our members will not be required to personally contribute any percentage of their pay for retirement. Current law is maintained. This is a big win.

· Heath Insurance Subsidy (HIS) – no FRS member will lose this subsidy. Current law is maintained. This is another big win.

· DROP – The program maintains current law for members currently in DROP. However, as of July 1, 2010 all new enrollees in DROP, the interest rate has been dramatically reduced from 6.5% down to 3%.

You will recall that significant changes were suggested to all of these programs for ideological and financial reasons. Staff analysis shows the state’s $117 billion pension fund supports 308,500 retirees and has another 572,000 workers enrolled in the system. A recent OPPAGA report showed a potential $15.4 billion shortfall in future payments helped spark debate about forcing the state’s 27,000 workers to pay into the fund. Most of that fund deficit has been erased which eased the call for changes. Additionally, FEA members made their voices heard by sending thousands of emails and phone calls to their Legislators voicing their opposition to any changes in FRS benefits.

Higher Education Notes:

· Language that could have affected FEA higher education units was dropped. There will not be a required 3 percent pay cut for state employees – our university faculty and staff.

· Numbers suggest that students could pay up to an extra 15 percent for tuition. The tuition increases will not be covered by the Bright Futures scholarship

· Big changes are coming to Bright Future. The budget cuts the scholarship awards $1 per credit hour and tightens eligibility standards for future students. Also the awards will be harder to get.

· Early numbers suggest Community Colleges (state colleges) stand to receive $1.12 billion in this next year’s budget, compared with $1.05 billion this year.

More coming soon. Back to the Capitol now!

Kevin W. Watson

Florida Education Association