Florida Senate - 2014                                    SB 1692
       
       
        
       By the Committee on Governmental Oversight and Accountability
       
       
       
       
       
       585-02888-14                                          20141692__
    1                        A bill to be entitled                      
    2         An act relating to the Florida Retirement System;
    3         amending s. 121.053, F.S.; authorizing renewed
    4         membership in the retirement system for retirees who
    5         are reemployed in a position eligible for the Elected
    6         Officers’ Class under certain circumstances; amending
    7         s. 121.055, F.S.; authorizing renewed membership in
    8         the retirement system for retirees of the Senior
    9         Management Service Optional Annuity Program who are
   10         reemployed on or after a specified date; amending s.
   11         121.122, F.S.; requiring that certain retirees who are
   12         employed on or after a specified date be renewed
   13         members in the investment plan; providing exceptions;
   14         providing that creditable service does not accrue for
   15         a reemployed retiree during a specified period;
   16         prohibiting certain funds from being paid into a
   17         renewed member’s investment plan account for a
   18         specified period of employment; requiring the renewed
   19         member to satisfy vesting requirements; prohibiting a
   20         renewed member from receiving disability benefits;
   21         specifying requirements and limitations; requiring the
   22         employer and the retiree to make applicable
   23         contributions to the member’s investment plan account;
   24         providing for the administration of the employer and
   25         employee contributions; prohibiting the purchase of
   26         past service in the investment plan; authorizing a
   27         renewed member to receive additional credit toward the
   28         health insurance subsidy under certain circumstances;
   29         providing that a retiree employed on or after a
   30         specified date in a regularly established position
   31         eligible for the State University System Optional
   32         Retirement Program is a renewed member of that
   33         program; specifying requirements and limitations;
   34         requiring the employer and the retiree to make
   35         applicable contributions; prohibiting the purchase of
   36         past service in the program; providing that a retiree
   37         employed on or after a specified date in a regularly
   38         established position eligible for the State Community
   39         College System Optional Retirement Program is a
   40         renewed member of that program; specifying
   41         requirements and limitations; requiring the employer
   42         and the retiree to make applicable contributions;
   43         prohibiting the purchase of past service in the
   44         program; amending s. 121.4501, F.S.; redefining the
   45         term “eligible employee”; specifying that a retiree
   46         who has returned to covered employment before a
   47         specified date may continue membership in his or her
   48         selected retirement plan; conforming a provision to
   49         changes made by the act; providing that the act
   50         fulfills an important state interest; providing an
   51         effective date.
   52          
   53  Be It Enacted by the Legislature of the State of Florida:
   54  
   55         Section 1. Subsections (3) and (5) of section 121.053,
   56  Florida Statutes, are amended to read:
   57         121.053 Participation in the Elected Officers’ Class for
   58  retired members.—
   59         (3) On or after July 1, 2010:
   60         (a) A retiree of a state-administered retirement system who
   61  is initially reemployed in elected or appointed for the first
   62  time to an elective office in a regularly established position
   63  with a covered employer may not reenroll in the Florida
   64  Retirement System, except as provided in s. 121.122.
   65         (b) An elected officer who is elected or appointed to an
   66  elective office and is participating in the Deferred Retirement
   67  Option Program is subject to termination as defined in s.
   68  121.021 upon completion of his or her DROP participation period.
   69  An elected official may defer termination as provided in
   70  subsection (7).
   71         (5) Any renewed member, as described in s. 121.122(1), (3),
   72  (4), or (5) subsection (1) or subsection (2), who is not
   73  receiving the maximum health insurance subsidy provided in s.
   74  112.363 is entitled to earn additional credit toward the maximum
   75  health insurance subsidy. Any additional subsidy due because of
   76  such additional credit may be received only at the time of
   77  payment of the second career retirement benefit. The total
   78  health insurance subsidy received from initial and renewed
   79  membership may not exceed the maximum allowed in s. 112.363.
   80         Section 2. Paragraph (f) of subsection (1) and paragraph
   81  (c) of subsection (6) of section 121.055, Florida Statutes, are
   82  amended to read:
   83         121.055 Senior Management Service Class.—There is hereby
   84  established a separate class of membership within the Florida
   85  Retirement System to be known as the “Senior Management Service
   86  Class,” which shall become effective February 1, 1987.
   87         (1)
   88         (f) Effective July 1, 1997:
   89         1. Except as provided in subparagraph 3., an elected state
   90  officer eligible for membership in the Elected Officers’ Class
   91  under s. 121.052(2)(a), (b), or (c) who elects membership in the
   92  Senior Management Service Class under s. 121.052(3)(c) may,
   93  within 6 months after assuming office or within 6 months after
   94  this act becomes a law for serving elected state officers, elect
   95  to participate in the Senior Management Service Optional Annuity
   96  Program, as provided in subsection (6), in lieu of membership in
   97  the Senior Management Service Class.
   98         2. Except as provided in subparagraph 3., an elected
   99  officer of a local agency employer eligible for membership in
  100  the Elected Officers’ Class under s. 121.052(2)(d) who elects
  101  membership in the Senior Management Service Class under s.
  102  121.052(3)(c) may, within 6 months after assuming office, or
  103  within 6 months after this act becomes a law for serving elected
  104  officers of a local agency employer, elect to withdraw from the
  105  Florida Retirement System, as provided in subparagraph (b)2., in
  106  lieu of membership in the Senior Management Service Class.
  107         3. A retiree of a state-administered retirement system who
  108  is initially reemployed in a regularly established position on
  109  or after July 1, 2010, through December 31, 2014, as an elected
  110  official eligible for the Elected Officers’ Class may not be
  111  enrolled in renewed membership in the Senior Management Service
  112  Class or in the Senior Management Service Optional Annuity
  113  Program as provided in subsection (6), and may not withdraw from
  114  the Florida Retirement System as a renewed member as provided in
  115  subparagraph (b)2., as applicable, in lieu of membership in the
  116  Senior Management Service Class. Effective January 1, 2015, a
  117  retiree of the Senior Management Service Optional Annuity
  118  Program who retired before July 1, 2010, and is reemployed in a
  119  regularly established position with a covered employer shall be
  120  enrolled as a renewed member as provided in s. 121.122.
  121         (6)
  122         (c) Participation.—
  123         1. An eligible employee who is employed on or before
  124  February 1, 1987, may elect to participate in the optional
  125  annuity program in lieu of participating in the Senior
  126  Management Service Class. Such election shall must be made in
  127  writing and filed with the department and the personnel officer
  128  of the employer on or before May 1, 1987. An eligible employee
  129  who is employed on or before February 1, 1987, and who fails to
  130  make an election to participate in the optional annuity program
  131  by May 1, 1987, is shall be deemed to have elected membership in
  132  the Senior Management Service Class.
  133         2. Except as provided in subparagraph 6., an employee who
  134  becomes eligible to participate in the optional annuity program
  135  by reason of initial employment commencing after February 1,
  136  1987, may, within 90 days after the date of commencing
  137  employment, elect to participate in the optional annuity
  138  program. Such election shall must be made in writing and filed
  139  with the personnel officer of the employer. An eligible employee
  140  who does not within 90 days after commencing employment elect to
  141  participate in the optional annuity program is shall be deemed
  142  to have elected membership in the Senior Management Service
  143  Class.
  144         3. A person who is appointed to a position in the Senior
  145  Management Service Class and who is a member of an existing
  146  retirement system or the Special Risk or Special Risk
  147  Administrative Support Classes of the Florida Retirement System
  148  may elect to remain in such system or class in lieu of
  149  participating in the Senior Management Service Class or optional
  150  annuity program. Such election shall must be made in writing and
  151  filed with the department and the personnel officer of the
  152  employer within 90 days after such appointment. An eligible
  153  employee who fails to make an election to participate in the
  154  existing system, the Special Risk Class of the Florida
  155  Retirement System, the Special Risk Administrative Support Class
  156  of the Florida Retirement System, or the optional annuity
  157  program is shall be deemed to have elected membership in the
  158  Senior Management Service Class.
  159         4. Except as provided in subparagraph 5., an employee’s
  160  election to participate in the optional annuity program is
  161  irrevocable if the employee continues to be employed in an
  162  eligible position and continues to meet the eligibility
  163  requirements set forth in this paragraph.
  164         5. Effective from July 1, 2002, through September 30, 2002,
  165  an active employee in a regularly established position who has
  166  elected to participate in the Senior Management Service Optional
  167  Annuity Program has one opportunity to choose to move from the
  168  Senior Management Service Optional Annuity Program to the
  169  Florida Retirement System Pension Plan.
  170         a. The election shall must be made in writing and must be
  171  filed with the department and the personnel officer of the
  172  employer before October 1, 2002, or, in the case of an active
  173  employee who is on a leave of absence on July 1, 2002, within 90
  174  days after the conclusion of the leave of absence. This election
  175  is irrevocable.
  176         b. The employee shall receive service credit under the
  177  pension plan equal to his or her years of service under the
  178  Senior Management Service Optional Annuity Program. The cost for
  179  such credit is the amount representing the present value of that
  180  employee’s accumulated benefit obligation for the affected
  181  period of service.
  182         c. The employee shall must transfer the total accumulated
  183  employer contributions and earnings on deposit in his or her
  184  Senior Management Service Optional Annuity Program account. If
  185  the transferred amount is not sufficient to pay the amount due,
  186  the employee shall must pay a sum representing the remainder of
  187  the amount due. The employee may not retain any employer
  188  contributions or earnings from the Senior Management Service
  189  Optional Annuity Program account.
  190         6. A retiree of a state-administered retirement system who
  191  is initially reemployed on or after July 1, 2010, through
  192  December 31, 2014, may not renew membership in the Senior
  193  Management Service Optional Annuity Program. Effective January
  194  1, 2015, a retiree of the Senior Management Service Optional
  195  Annuity Program who retired before July 1, 2010, and is
  196  reemployed in a regularly established position with a covered
  197  employer shall be enrolled as a renewed member as provided in s.
  198  121.122.
  199         Section 3. Subsection (2) of section 121.122, Florida
  200  Statutes, is amended, and subsections (3), (4), and (5) are
  201  added to that section, to read:
  202         121.122 Renewed membership in system.—
  203         (2) Except as otherwise provided in subsections (3)-(5), a
  204  retiree of a state-administered retirement system who is
  205  initially reemployed in a regularly established position on or
  206  after July 1, 2010, may not be enrolled as a renewed member.
  207         (3) A retiree of the investment plan, the State University
  208  System Optional Retirement Program, the Senior Management
  209  Service Optional Annuity Program, or the State Community College
  210  System Optional Retirement Program who retired before July 1,
  211  2010, and is employed in a regularly established position with a
  212  covered employer on or after January 1, 2015, shall be a renewed
  213  member of the Regular Class of the investment plan, regardless
  214  of the position held, unless employed in a position eligible for
  215  participation in the State University System Optional Retirement
  216  Program or the State Community College System Optional
  217  Retirement Program as provided in subsections (4) and (5),
  218  respectively. The renewed member must satisfy the vesting
  219  requirements and other provisions of this chapter.
  220         (a) Creditable service, including credit toward the retiree
  221  health insurance subsidy provided in s. 112.363, does not accrue
  222  for a retiree’s employment in a regularly established position
  223  with a covered employer from July 1, 2010, through December 31,
  224  2014.
  225         (b) Employer and employee contributions, interest,
  226  earnings, or any other funds may not be paid into a renewed
  227  member’s investment plan account for any employment in a
  228  regularly established position with a covered employer from July
  229  1, 2010, through December 31, 2014, by the renewed member or the
  230  employer on behalf of the member.
  231         (c) To be eligible to receive a retirement benefit, the
  232  renewed member must satisfy the vesting requirements in s.
  233  121.4501(6).
  234         (d) The member is ineligible to receive disability benefits
  235  as provided in s. 121.091(4) or s. 121.591(2).
  236         (e) The member is subject to the reemployment after
  237  retirement limitations provided in s. 121.091(9), as applicable.
  238         (f) The member must satisfy the requirements for
  239  termination from employment provided in s. 121.021(39).
  240         (g) Upon the renewed membership or reemployment of a
  241  retiree, the employer and the retiree shall pay the applicable
  242  employer and employee contributions required under ss. 112.363,
  243  121.71, 121.74, and 121.76. The contributions are payable only
  244  for employment and salary earned in a regularly established
  245  position with a covered employer on or after January 1, 2015.
  246  The employer and employee contributions shall be transferred to
  247  the investment plan and placed in a default fund as designated
  248  by the state board. The retiree may move the contributions once
  249  an account is activated in the investment plan.
  250         (h) The member may not purchase any past service in the
  251  investment plan, including employment in a regularly established
  252  position with a covered employer from July 1, 2010, through
  253  December 31, 2014.
  254         (i) A renewed member who is a retiree of the investment
  255  plan and who is not receiving the maximum health insurance
  256  subsidy provided in s. 112.363 is entitled to earn additional
  257  credit toward the subsidy. Such credit may be earned only for
  258  employment in a regularly established position with a covered
  259  employer on or after January 1, 2015. Any additional subsidy due
  260  because of additional credit may be received only at the time of
  261  paying the second career retirement benefit. The total health
  262  insurance subsidy received by a retiree receiving benefits from
  263  initial and renewed membership may not exceed the maximum
  264  allowed under s. 112.363.
  265         (4) A retiree of the investment plan, the State University
  266  System Optional Retirement Program, the Senior Management
  267  Service Optional Annuity Program, or the State Community College
  268  System Optional Retirement Program who retired before July 1,
  269  2010, and is employed in a regularly established position
  270  eligible for participation in the State University System
  271  Optional Retirement Program on or after January 1, 2015, shall
  272  become a renewed member of the optional retirement program. The
  273  renewed member must satisfy the vesting requirements and other
  274  provisions of this chapter. Once enrolled, a renewed member
  275  remains enrolled in the optional retirement program while
  276  employed in an eligible position for the optional retirement
  277  program. If employment in a different covered position results
  278  in the retiree’s enrollment in the investment plan, the retiree
  279  is no longer eligible to participate in the optional retirement
  280  program unless employed in a mandatory position under s. 121.35.
  281         (a) The member is subject to the reemployment after
  282  retirement limitations provided in s. 121.091(9), as applicable.
  283         (b) The member must satisfy the requirements for
  284  termination of employment provided in s. 121.021(39).
  285         (c) Upon renewed membership or reemployment of a retiree,
  286  the employer and the retiree shall pay the applicable employer
  287  and employee contributions required under s. 121.35.
  288         (d) The member, or the employer on behalf of the member,
  289  may not purchase any prior service in the optional retirement
  290  program or employment from July 1, 2010, to December 31, 2014,
  291  when renewed membership is not available.
  292         (5) A retiree of the investment plan, the State University
  293  System Optional Retirement Program, the Senior Management
  294  Service System Optional Annuity Program, or the State Community
  295  College System Optional Retirement Program who retired before
  296  July 1, 2010, and is employed in a regularly established
  297  position eligible for participation in the State Community
  298  College System Optional Retirement Program as provided in s.
  299  121.051(2)(c)4. on or after January 1, 2015, shall become a
  300  renewed member of the optional retirement program. The renewed
  301  member must satisfy the eligibility requirements of this chapter
  302  and s. 1012.875 for the optional retirement program. Once
  303  enrolled, a renewed member remains enrolled in the optional
  304  retirement program while employed in an eligible position for
  305  the optional retirement program. If employment in a different
  306  covered position results in the retiree’s enrollment in the
  307  investment plan, the retiree is no longer eligible to
  308  participate in the optional retirement program.
  309         (a) The member is subject to the reemployment after
  310  retirement limitations provided in s. 121.091(9), as applicable.
  311         (b) The member must satisfy the requirements for
  312  termination of employment provided in s. 121.021(39).
  313         (c) Upon renewed membership or reemployment of a retiree,
  314  the employer and the retiree shall pay the applicable employer
  315  and employee contributions required under ss. 121.051(2)(c) and
  316  1012.875.
  317         (d) The member, or the employer on behalf of the member,
  318  may not purchase any past service in the optional retirement
  319  program or employment accrued from July 1, 2010, to December 31,
  320  2014.
  321         Section 4. Paragraph (e) of subsection (2) and paragraph
  322  (f) of subsection (4) of section 121.4501, Florida Statutes, are
  323  amended to read:
  324         121.4501 Florida Retirement System Investment Plan.—
  325         (2) DEFINITIONS.—As used in this part, the term:
  326         (e) “Eligible employee” means an officer or employee, as
  327  defined in s. 121.021, who:
  328         1. Is a member of, or is eligible for membership in, the
  329  Florida Retirement System, including any renewed member of the
  330  Florida Retirement System initially enrolled before July 1,
  331  2010; or
  332         2. Participates in, or is eligible to participate in, the
  333  Senior Management Service Optional Annuity Program as
  334  established under s. 121.055(6), the State Community College
  335  System Optional Retirement Program as established under s.
  336  121.051(2)(c), or the State University System Optional
  337  Retirement Program established under s. 121.35; or
  338         3. Is a retired member of the investment plan, the State
  339  University System Optional Retirement Program, the Senior
  340  Management Service Optional Annuity Program, or the State
  341  Community College System Optional Retirement Program who retired
  342  before July 1, 2010 and is employed in a regularly established
  343  position on or after January 1, 2015, as provided in s. 121.122.
  344  
  345  The term does not include any member participating in the
  346  Deferred Retirement Option Program established under s.
  347  121.091(13), a retiree of a state-administered retirement system
  348  who retired initially reemployed in a regularly established
  349  position on or after July 1, 2010, or a mandatory participant of
  350  the State University System Optional Retirement Program
  351  established under s. 121.35.
  352         (4) PARTICIPATION; ENROLLMENT.—
  353         (f) A member of the investment plan who takes a
  354  distribution of any contributions from his or her investment
  355  plan account is considered a retiree. A member retiree who
  356  retires is initially reemployed in a regularly established
  357  position on or after July 1, 2010, is not eligible to be
  358  enrolled in renewed membership. A member who retired before July
  359  1, 2010, and is employed on or after January 1, 2015, in a
  360  regularly established position shall be a renewed member as
  361  provided in s. 121.122, except that a retiree who has returned
  362  to covered employment before July 1, 2010 may continue
  363  membership in the plan he or she chooses.
  364         Section 5. The Legislature finds that a proper and
  365  legitimate state purpose is served when employees and retirees
  366  of the state and its political subdivisions, and the dependents,
  367  survivors, and beneficiaries of such employees and retirees, are
  368  extended the basic protections afforded by governmental
  369  retirement systems. These persons must be provided benefits that
  370  are fair and adequate and that are managed, administered, and
  371  funded in an actuarially sound manner, as required by s. 14,
  372  Article X of the State Constitution and part VII of chapter 112,
  373  Florida Statutes. Therefore, the Legislature determines and
  374  declares that this act fulfills an important state interest.
  375         Section 6. This act shall take effect July 1, 2014.