A reader commented that the 401a contributions were misappropriations. However, Judge William Stone didn’t use the word “misappropriation” in his ruling.
NO DOLLAR DIFFERENCE TO TAXPAYERS: According to the court order, the cost to taxpayers was the same whether commissioners participated in the Local Plan or FRS. The difference was in how the money was allocated – under the Local Plan, funds should have gone toward maintaining FRS’s actuarial soundness (44.23% of salary) instead went directly to the commissioners’ retirement accounts. The court specifically addressed this on pages 14-15, acknowledging the County’s argument that “the cost to the County is the same under the Local Plan as in FRS” but explaining why this surface-level cost equivalence wasn’t the only relevant consideration.
KEY POINTS FROM THE COURT’S RULING
Core Issue: The court evaluated whether county commissioners could legally participate in the County’s Local 401a Retirement Plan instead of the Florida Retirement System (FRS) and whether such participation constituted unlawful compensation.
Key Findings:
- The 401a Local Plan is not authorized by Florida Statute 121.182, which only applies to “county personnel,” not elected officials.
- The 401a Local Plan significantly benefited commissioners compared to FRS.
- The 401a Local Plan diverted funds meant for maintaining FRS’s actuarial soundness.
Court’s Ruling:
- County commissioners cannot legally participate in the Local 401a Plan.
- The County’s contributions to the Local Plan for commissioners constitute unlawful compensation.
- The Clerk properly exercised discretion in stopping payments to the Local Plan.
Basis for Decision:
- Florida Constitution and statutes require county officer compensation to be fixed by law.
- The Plan violates legislative intent for uniform compensation of county officials.
- The Plan undermines FRS’s actuarial soundness by diverting required contributions.
DIG DEEPER: While Childers called the plan “absurd” and “evil,” the plan had been in effect for 27 years. According to the court document, Escambia County entered into a contract with ICMA Retirement Corporation in 1997 to establish a local retirement program. Specifically, this was done “on January 7, 1997, by passing Resolution (R97-1),” which was codified as Section 2-151 of the Escambia County Code of Ordinances. The plan hadn’t been question until 2021 during Childers’ third term.
The entity that benefited from the ruling is the Florida Retirement System.