WEST PALM BEACH, Fla. - A $25 million shortfall in a pension fund that benefits hundreds of Palm Tran employees could cost Palm Beach County taxpayers more money and slash benefits for public transit workers.
Assistant Palm Beach County Administrator Brad Merriman said that Palm Tran's pension plan, which is separate from the state's pension plan, is facing a roughly $25 million deficit.
The plan is funded at 60 percent, which means that if everybody tried to collect their benefits all at once, there would only be enough money to pay 60 percent of them.
"Primarily because of market situations, and the fact that it is a relatively small pension plan, it has become underfunded," Merriman said.
The Florida Department of Management Services, in a letter sent to the pension board last month, said that county contributions are insufficient to adequately fund benefits for Palm Tran employees. The state asked the county and the Amalgamated Transit Union Local 1577, which represents 380 of the 400-500 Palm Tran employees covered by the pension, to agree on a plan to fix the shortfall, according to officials.
Union president Dwight Mattingly referred all questions about the pension plan shortfall to the pension board. Pension board representative Nick Schiess also declined comment.
Merriman said the county has been negotiating with the union.
"What we have been trying to do is negotiate a series of changes to the plan that would bring it to actuarial soundness within a reasonable time period," Merriman said. "We haven't been able to reach an agreement."
If no agreement is reached, the county will have to increase its contributions to the pension fund, employees will have to pay more, and pension benefits for new employees and possibly some current employees may be reduced, Merriman said.
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