HB 0483

1
A bill to be entitled
2An act relating to the Florida Retirement System; amending
3s. 121.021, F.S.; providing a definition; amending ss.
4121.051 and 121.0511, F.S.; removing cross references, to
5conform; amending s. 121.055, F.S.; authorizing certain
6senior management employees who withdrew from the system a
7period within which to transfer into certain retirement
8programs of the system; providing for transfer of
9retirement contributions, interest, and earnings;
10providing employees with service credit upon transferring
11into a new program; providing requirements for the
12calculation of service credit; requiring employees to
13transfer funds upon moving into a new program; providing
14an effective date.
15
16Be It Enacted by the Legislature of the State of Florida:
17
18     Section 1.  Subsection (62) is added to section 121.021,
19Florida Statutes, to read:
20     121.021  Definitions.--The following words and phrases as
21used in this chapter have the respective meanings set forth
22unless a different meaning is plainly required by the context:
23     (62)  "Enrolled actuary" means an actuary who is enrolled
24under Subtitle C of Title III of the Employee Retirement Income
25Security Act of 1974 and who is a member of the Society of
26Actuaries or the American Academy of Actuaries.
27     Section 2.  Paragraph (b) of subsection (2) of section
28121.051, Florida Statutes, is amended to read:
29     121.051  Participation in the system.--
30     (2)  OPTIONAL PARTICIPATION.--
31     (b)1.  The governing body of any municipality or special
32district in the state may elect to participate in the system
33upon proper application to the administrator and may cover all
34or any of its units as approved by the Secretary of Health and
35Human Services and the administrator. The department shall adopt
36rules establishing provisions for the submission of documents
37necessary for such application. Prior to being approved for
38participation in the Florida Retirement System, the governing
39body of any such municipality or special district that has a
40local retirement system shall submit to the administrator a
41certified financial statement showing the condition of the local
42retirement system as of a date within 3 months prior to the
43proposed effective date of membership in the Florida Retirement
44System. The statement must be certified by a recognized
45accounting firm that is independent of the local retirement
46system. All required documents necessary for extending Florida
47Retirement System coverage must be received by the department
48for consideration at least 15 days prior to the proposed
49effective date of coverage. If the municipality or special
50district does not comply with this requirement, the department
51may require that the effective date of coverage be changed.
52     2.  Any city or special district that has an existing
53retirement system covering the employees in the units that are
54to be brought under the Florida Retirement System may
55participate only after holding a referendum in which all
56employees in the affected units have the right to participate.
57Only those employees electing coverage under the Florida
58Retirement System by affirmative vote in said referendum shall
59be eligible for coverage under this chapter, and those not
60participating or electing not to be covered by the Florida
61Retirement System shall remain in their present systems and
62shall not be eligible for coverage under this chapter. After the
63referendum is held, all future employees shall be compulsory
64members of the Florida Retirement System.
65     3.  The governing body of any city or special district
66complying with subparagraph 1. may elect to provide, or not
67provide, benefits based on past service of officers and
68employees as described in s. 121.081(1). However, if such
69employer elects to provide past service benefits, such benefits
70must be provided for all officers and employees of its covered
71group.
72     4.  Once this election is made and approved it may not be
73revoked, except pursuant to subparagraphs 5. and 6., and all
74present officers and employees electing coverage under this
75chapter and all future officers and employees shall be
76compulsory members of the Florida Retirement System.
77     5.  Subject to the conditions set forth in subparagraph 6.,
78the governing body of any hospital licensed under chapter 395
79which is governed by the board of a special district as defined
80in s. 189.403(1) or by the board of trustees of a public health
81trust created under s. 154.07, hereinafter referred to as
82"hospital district," and which participates in the system, may
83elect to cease participation in the system with regard to future
84employees in accordance with the following procedure:
85     a.  No more than 30 days and at least 7 days before
86adopting a resolution to partially withdraw from the Florida
87Retirement System and establish an alternative retirement plan
88for future employees, a public hearing must be held on the
89proposed withdrawal and proposed alternative plan.
90     b.  From 7 to 15 days before such hearing, notice of intent
91to withdraw, specifying the time and place of the hearing, must
92be provided in writing to employees of the hospital district
93proposing partial withdrawal and must be published in a
94newspaper of general circulation in the area affected, as
95provided by ss. 50.011-50.031. Proof of publication of such
96notice shall be submitted to the Department of Management
97Services.
98     c.  The governing body of any hospital district seeking to
99partially withdraw from the system must, before such hearing,
100have an actuarial report prepared and certified by an enrolled
101actuary, as defined in s. 112.625(3), illustrating the cost to
102the hospital district of providing, through the retirement plan
103that the hospital district is to adopt, benefits for new
104employees comparable to those provided under the Florida
105Retirement System.
106     d.  Upon meeting all applicable requirements of this
107subparagraph, and subject to the conditions set forth in
108subparagraph 6., partial withdrawal from the system and adoption
109of the alternative retirement plan may be accomplished by
110resolution duly adopted by the hospital district board. The
111hospital district board must provide written notice of such
112withdrawal to the division by mailing a copy of the resolution
113to the division, postmarked no later than December 15, 1995. The
114withdrawal shall take effect January 1, 1996.
115     6.  Following the adoption of a resolution under sub-
116subparagraph 5.d., all employees of the withdrawing hospital
117district who were participants in the Florida Retirement System
118prior to January 1, 1996, shall remain as participants in the
119system for as long as they are employees of the hospital
120district, and all rights, duties, and obligations between the
121hospital district, the system, and the employees shall remain in
122full force and effect. Any employee who is hired or appointed on
123or after January 1, 1996, may not participate in the Florida
124Retirement System, and the withdrawing hospital district shall
125have no obligation to the system with respect to such employees.
126     Section 3.  Subsection (3) of section 121.0511, Florida
127Statutes, is amended to read:
128     121.0511  Revocation of election and alternative plan.--The
129governing body of any municipality or independent special
130district that has elected to participate in the Florida
131Retirement System may revoke its election in accordance with the
132following procedure:
133     (3)  The governing body of a municipality or independent
134special district seeking to revoke its election to participate
135in the system must, before such revocation, have an actuarial
136report prepared and certified by an enrolled actuary, as defined
137in s. 112.625, illustrating the cost to the municipality or
138independent special district and to its future employees of
139providing a new retirement plan for employees hired after
140January 1, 1996.
141     Section 4.  Paragraph (b) of subsection (1) of section
142121.055, Florida Statutes, is amended to read:
143     121.055  Senior Management Service Class.--There is hereby
144established a separate class of membership within the Florida
145Retirement System to be known as the "Senior Management Service
146Class," which shall become effective February 1, 1987.
147     (1)
148     (b)1.  Except as provided in subparagraph 2., effective
149January 1, 1990, participation in the Senior Management Service
150Class shall be compulsory for the president of each community
151college, the manager of each participating city or county, and
152all appointed district school superintendents. Effective January
1531, 1994, additional positions may be designated for inclusion in
154the Senior Management Service Class of the Florida Retirement
155System, provided that:
156     a.  Positions to be included in the class shall be
157designated by the local agency employer. Notice of intent to
158designate positions for inclusion in the class shall be
159published once a week for 2 consecutive weeks in a newspaper of
160general circulation published in the county or counties
161affected, as provided in chapter 50.
162     b.  Up to 10 nonelective full-time positions may be
163designated for each local agency employer reporting to the
164Department of Management Services; for local agencies with 100
165or more regularly established positions, additional nonelective
166full-time positions may be designated, not to exceed 1 percent
167of the regularly established positions within the agency.
168     c.  Each position added to the class must be a managerial
169or policymaking position filled by an employee who is not
170subject to continuing contract and serves at the pleasure of the
171local agency employer without civil service protection, and who:
172     (I)  Heads an organizational unit; or
173     (II)  Has responsibility to effect or recommend personnel,
174budget, expenditure, or policy decisions in his or her areas of
175responsibility.
176     2.  In lieu of participation in the Senior Management
177Service Class, members of the Senior Management Service Class
178pursuant to the provisions of subparagraph 1. may withdraw from
179the Florida Retirement System altogether. The decision to
180withdraw from the Florida Retirement System shall be irrevocable
181for as long as the employee holds such a position. Any service
182creditable under the Senior Management Service Class shall be
183retained after the member withdraws from the Florida Retirement
184System; however, additional service credit in the Senior
185Management Service Class shall not be earned after such
186withdrawal. Such members shall not be eligible to participate in
187the Senior Management Service Optional Annuity Program.
188     3.  Effective January 1, 2006, and terminating June 30,
1892006, an employee who has withdrawn from the Florida Retirement
190System pursuant to subparagraph 2., shall have one opportunity,
191at the employee's discretion, to transfer from his or her
192current optional retirement program to the defined benefit
193program of the Florida Retirement System or to the Public
194Employee Optional Retirement Program, subject to the terms of
195the applicable optional retirement program contracts.
196     a.  If an employee chooses to move to the Public Employee
197Optional Retirement Program, any contributions, interest, and
198earnings creditable to the employee under the local optional
199retirement program shall be retained by the employee in the
200local optional retirement program, and the applicable provisions
201of s. 121.4501(4) shall govern the election.
202     b.  If an employee chooses to move to the defined benefit
203program of the Florida Retirement System, the employee shall
204receive service credit equal to his or her years of service
205under the local optional retirement program.
206     (I)  The cost for such credit shall be an amount
207representing the present value of that employee's accumulated
208benefit obligation for the affected period of service. The cost
209shall be calculated as if the benefit commencement occurs on the
210first date the employee would become eligible for unreduced
211benefits, using the discount rate and other relevant actuarial
212assumptions that were used to value the Florida Retirement
213System defined benefit plan liabilities in the most recent
214actuarial valuation. The calculation shall include any service
215previously maintained under the defined benefit plan in addition
216to the years under the local optional retirement program. The
217present value of any service already maintained under the
218defined benefit plan shall be applied as a credit to total cost
219resulting from the calculation. The division shall ensure that
220the transfer sum is prepared using a formula and methodology
221certified by an enrolled actuary.
222     (II)  The employee must transfer from his or her local
223optional retirement program account, and from other employee
224moneys as necessary, a sum representing the present value of
225that employee's accumulated benefit obligation immediately
226following the time of such movement if attained service equals
227the sum of service in the defined benefit program and service in
228the local optional retirement program.
229     Section 5.  This act shall take effect July 1, 2005.


CODING: Words stricken are deletions; words underlined are additions.