Inside City Hall: How Miami Firefighters Retire With Six-Figure Pensions

A Spotlight analysis of retirement records, labor contracts and city payroll data explains why Miami firefighters are far more likely than other city employees to retire with six-figure pensions — and why those costs may continue to grow.

They worked for the same city. They spent decades in public service. They retired after long careers.

Yet one group of City of Miami employees is far more likely than any other to retire with a six-figure pension.

A Coconut Grove Spotlight analysis of retirement records found that 275 of the city’s roughly 760 retired firefighters — more than one in three — currently receive annual pensions exceeding $100,000.

By comparison, only about 8 percent of the city’s approximately 1,076 retired police officers — 86 retirees — receive six-figure pensions. In the city’s separate retirement system for general service workers and sanitation employees, fewer than 1 percent of the 1,836 retirees — just 13 people — receive annual pensions exceeding $100,000.

Among the approximately 3,684 retirees in the City of Miami’s two principal pension systems, 49 of the 50 largest annual pension checks go to former Miami Fire Rescue employees.

Read more: Inside City Hall: The Rise of Six-Figure Public Safety Pensions

The gap could grow even wider.

In May, the Miami City Commission approved a series of firefighter pay and pension changes, including provisions that roll back portions of the retirement reforms imposed during the city’s 2010 financial crisis. 

While the changes will not immediately affect today’s retirees, they are expected to increase pension benefits for many firefighters in the years ahead — with no official estimate of the long-term cost to taxpayers.

Read more: Miami Eyes New Firefighter Pension Expansion Without Public Cost Estimate

The disproportionate share of six-figure pensions going to firefighters raises an obvious question: Why do they receive far larger pensions than other City of Miami employees?

The Spotlight reviewed the city’s three retirement systems, collective bargaining agreements, financial statements and pension records to find the answer.

It is not because firefighters earn the highest salaries. City payroll records show the city’s 1,362 sworn police officers average about $108,800 a year in base pay, compared with roughly $96,200 for its 785 firefighters. The city’s nearly 2,900 general employees average about $80,300 annually.

Nor is the disparity driven by overtime pay. Unlike police officers — and contrary to a common assumption — firefighters generally cannot include overtime pay when their pensions are calculated. 

But base salary — the amount employees are scheduled to earn each year — is not the only compensation used to calculate pension benefits. 

Under the firefighters’ labor contract, retirement benefits for many current retirees are based on the employee’s highest year of pensionable earnings, which can be substantially increased through specialty pay, incentives and assignment premiums. 

Those specialty add-ons — including paramedic, hazardous materials, dive team, technical rescue, acting officer, management positions and longevity pay — can increase the salary used to calculate a firefighter’s pension by thousands, and in some cases tens of thousands, of dollars a year.

The extra pay adds up. The city budgeted $20 million for such firefighter “specialty pay” in its current fiscal year alone.

Just how much Miami’s firefighters actually earn each year remains unclear. Despite repeated requests, the city has refused the Spotlight’s request for records showing the total annual compensation earned by its more than 5,000 employees — including firefighters — after factoring in overtime, specialty pay, bonuses and other compensation that may affect pension calculations.

Read more: Inside City Hall: Miami’s Salary Secret

Police officers also receive specialty and incentive pay, although generally fewer forms of supplemental compensation count toward pension calculations. 

In 2024, the City Commission approved changes to its pension ordinance allowing police officers to count up to 200 hours of overtime worked in a year toward their pensionable earnings.

General employees participate in an entirely different retirement system that provides fewer opportunities to increase pensionable earnings.

In addition to a greater array of supplemental pay options, Miami’s firefighters receive a substantially richer retirement formula, city records show.

Most firefighters earn retirement benefits using a tiered formula that credits the first 15 years of service at 3 percent of pensionable salary per year and each additional year at 3.5 percent. Police officers generally earn benefits using a 3 percent multiplier, while most general service employees earn benefits using a 2 percent multiplier. 

The difference compounds over an entire career, in a system where the pensionable salary for many firefighters is based on their single highest year of eligible earnings — including specialty pay and certain assignment premiums.

A rank-and-file firefighter retiring after 30 years with a pensionable salary of $100,000 would receive an annual pension of approximately $97,500 before cost-of-living adjustments. By comparison, a police officer retiring with the same salary and years of service would receive approximately $90,000, while a general employee would receive approximately $60,000.

In other words, a firefighter and a general employee could spend the same 30-year career working for the same city, retire with the same pensionable salary and receive pensions that differ by $37,500 a year simply because they belong to different retirement systems.

After 30 years of collecting those benefits, the difference in payouts would total about $1.125 million, even before any cost-of-living increases.

And those figures are based on the relatively modest example of $100,000 in pensionable earnings.

As of March, at least 17 City of Miami Fire Rescue employees were scheduled to earn more than $200,000 in base salary alone, according to city payroll records, with additional firefighters likely surpassing that threshold after specialty pay and other forms of pensionable compensation are factored in.

Under the city’s current pension formula, a firefighter retiring after 30 years with $200,000 in pensionable earnings would receive an annual pension of approximately $195,000 before cost-of-living adjustments. Over a 30-year retirement, those benefits would total about $5.85 million.

According to the city’s most recent audited financial statements, Miami is responsible for roughly $3.5 billion in future pension benefits for current and former employees, with more than $1 billion of that currently unfunded.

A common misconception is that employee payroll deductions largely fund the city’s pension systems. In reality, employee contributions represent only a small share of the funding. 

During the last fiscal year, the city contributed about $183 million, while employees contributed about $38.1 million — less than one-quarter of the city’s contribution. The pension systems also generated approximately $269 million in net investment income.

The city’s retirement obligations could grow even larger. 

Last month, former City Attorney Victoria Mendez sued the City of Miami and the retirement trust that administers the civilian pension system, arguing a pension cap adopted during the city’s 2010 financial crisis is no longer legally enforceable. She is asking a court to declare the cap void and order payment of the full retirement benefits she contends she earned — a ruling that could increase pension costs for the city.

Read more: Former City Attorney Sues Miami Over Disputed Pension Cap

The possibility of significantly higher pension obligations should Mendez’s lawsuit — or similar legal challenges — ultimately prevail is expected to loom over negotiations on new labor contracts for the city’s police, fire and general employees unions, whose collective bargaining agreements all expire at the end of September. One city commissioner has already told the Spotlight he expects “a battle.”

Whatever the outcome, city officials project a growing cost for taxpayers.

Under Mayor Eileen Higgins’ proposed operating budget for the fiscal year beginning Oct. 1, the city’s contribution to the General Employees’ and Sanitation Employees’ Retirement Trust would increase by a relatively modest $2.8 million, or 4.8%, to $61.1 million.

The contribution to the Firefighters’ and Police Officers’ Retirement Trust, by contrast, would increase by $29.1 million to $156.6 million — a whopping 22.8% increase in a single year.