JACKSONVILLE, Fla. – Jacksonville’s Police and Fire Pension Fund remains under 45% funded, despite strong investment returns over the past year.
Deputy Director Steve Lundy presented to the City Council Finance Committee this week that the fund’s funding ratio is currently at 44.1%, a slight decrease from last year’s 44.7%.
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“Our investment returns were outstanding at 20.4%, far outpacing our assumed rate of 6.5%, and our pension health remains stable, although the funded ratio did slightly decrease,” Lundy said.
The pension plan closed to new entrants in 2017 as part of a reform effort, is projected to be fully funded by 2056. A half-cent sales tax will begin contributing to the pension liability in 2031, extending the Better Jacksonville Plan tax.
While surtax proceeds dropped from 9.3% to 2.4% year over year, the impact was offset by the plan’s five-year average return of 8.7% and a 10-year average return of 7.4%, both exceeding the assumed 6.5% return rate.
Despite concerns over pension liabilities, the city has recently moved toward restoring pension benefits for new hires. Starting in 2026, Jacksonville police and firefighters will return to a pension plan under the Florida Retirement System, a shift from the 401(k) style system adopted in 2016.
Union leaders emphasize that this change is critical for recruitment and retention. News4JAX reported in June 2024 that union leaders highlighted the importance of this shift for attracting and retaining qualified personnel.
Mayor Donna Deegan has championed the pension shift, stating that it aligns Jacksonville’s first responders with the rest of the state. In June 2024, News4JAX reported that Deegan said, “I said when I was running for mayor that I wanted to look hard at that. The FRS made the most sense to me then, it makes the most sense to me now.”
The pension fund’s financial trajectory will continue to be closely monitored as the city balances pension commitments with other budgetary priorities.
