Attorney General Pam Bondi vowed Tuesday that money the state gets from a national mortgage-fraud settlement will go to consumers, not to pay raises for state employees as one lawmaker has suggested.
“I think we’d all love pay raises, but that’s not what this money is for,” Bondi said in response to questions about a proposal made earlier in the week by Rep. Michelle Rehwinkel Vasilinda, D-Tallahassee.
Rehwinkel Vasilinda, whose district includes a huge portion of the state employees who work in the capital city, said she would propose that state employees get a 7 percent raise in the upcoming legislative budget using a $334 million cash payment the state recently received from the national mortgage-foreclosures settlement.
Federal officials and the states negotiated the $25 billion settlement with the five largest mortgage servicers, who were accused of unscrupulous handling of mortgages in foreclosure. Part of the settlement is required to be spent on borrowers who lost their homes to foreclosure between 2008 and 2011, but Rehwinkel Vasilinda said some of it can be used for other purposes. She noted that Georgia has used its settlement money for other purposes than helping foreclosed homeowners.
“It has been six years since Florida’s state employees had their last raise and during that time the Consumer Price Index has increased by 15 percent, which has further degraded the purchasing power of our already underpaid state employees,” Rehwinkel Vasilinda said in announcing her proposal.
A 7 percent raise for all state employees would cost about $487 million. Rehwinkel Vasilinda said if the money were available through higher revenue, lawmakers should find a way to pay for the increase anyway, even if it doesn’t come from the settlement.
Bondi said she would resist any effort to divert the settlement money away from the borrowers who were victims of bad acts by the mortgage industry.
“It will not be used for pay raises if I have anything to do with it,” Bondi said.
By David Royse
