HB 1119

1	A bill to be entitled
2	An act relating to the Florida Retirement System; amending
3	s. 121.091, F.S.; revising the formula for calculating
4	retirement benefits payable to Regular Class members to
5	increase the benefit; providing for funding the benefit
6	increase; providing a finding of important state interest;
7	providing an effective date.
8
9	Be It Enacted by the Legislature of the State of Florida:
10
11	Section 1.  Subsection (1) of section 121.091, Florida
12	Statutes, is amended to read:
13	121.091  Benefits payable under the system.--Benefits may
14	not be paid under this section unless the member has terminated
15	employment as provided in s. 121.021(39)(a) or begun
16	participation in the Deferred Retirement Option Program as
17	provided in subsection (13), and a proper application has been
18	filed in the manner prescribed by the department. The department
19	may cancel an application for retirement benefits when the
20	member or beneficiary fails to timely provide the information
21	and documents required by this chapter and the department's
22	rules. The department shall adopt rules establishing procedures
23	for application for retirement benefits and for the cancellation
24	of such application when the required information or documents
25	are not received.
26	(1)  NORMAL RETIREMENT BENEFIT.--Upon attaining his or her
27	normal retirement date and filing an application, the member,
28	upon application to the administrator, shall receive a monthly
29	benefit, which begins accruing which shall begin to accrue on
30	the first day of the month of retirement and is be payable on
31	the last day of that month and each month thereafter during the
32	member's his or her lifetime. The normal retirement benefit,
33	including any past or additional retirement credit, may not
34	exceed 100 percent of the member's average final compensation.
35	The amount of monthly benefit shall be calculated as the product
36	of A and B, subject to the adjustment of C, if applicable, as
37	set forth below:
38	(a)1.  For creditable years of Regular Class service, A is
39	1.80 1.60 percent of the member's average final compensation, up
40	to the member's normal retirement date. Upon completion of the
41	first year after the normal retirement date, A is 1.63 percent
42	of the member's average final compensation. Following the second
43	year after the normal retirement date, A is 1.65 percent of the
44	member's average final compensation. Following the third year
45	after the normal retirement date, and for subsequent years, A is
46	1.68 percent of the member's average final compensation.
47	2.  For creditable years of Special Risk Class service, A
48	is:
49	a.  Two percent of the member's average final compensation
50	for all creditable years prior to October 1, 1974;
51	b.  Three percent of the member's average final
52	compensation for all creditable years after September 30, 1974,
53	and before October 1, 1978;
54	c.  Two percent of the member's average final compensation
55	for all creditable years after September 30, 1978, and before
56	January 1, 1989;
57	d.  Two and two-tenths percent of the member's final
58	monthly compensation for all creditable years after December 31,
59	1988, and before January 1, 1990;
60	e.  Two and four-tenths percent of the member's average
61	final compensation for all creditable years after December 31,
62	1989, and before January 1, 1991;
63	f.  Two and six-tenths percent of the member's average
64	final compensation for all creditable years after December 31,
65	1990, and before January 1, 1992;
66	g.  Two and eight-tenths percent of the member's average
67	final compensation for all creditable years after December 31,
68	1991, and before January 1, 1993;
69	h.  Three percent of the member's average final
70	compensation for all creditable years after December 31, 1992;
71	and
72	i.  Three percent of the member's average final
73	compensation for all creditable years of service after September
74	30, 1978, and before January 1, 1993, for any special risk
75	member who retires after July 1, 2000, or any member of the
76	Special Risk Administrative Support Class entitled to retain the
77	special risk normal retirement date who was a member of the
78	Special Risk Class during the time period and who retires after
79	July 1, 2000.
80	3.  For creditable years of Senior Management Service Class
81	service after January 31, 1987, A is 2 percent.;
82	4.  For creditable years of Elected Officers' Class service
83	as a Supreme Court Justice, district court of appeal judge,
84	circuit judge, or county court judge, A is 3 1/3 percent of the
85	member's average final compensation, and for all other
86	creditable service in such class, A is 3 percent of the member's
87	average final compensation.;
88	(b)  B is the number of the member's years of creditable
89	service and any fractional part of a year of creditable service
90	earned subsequent to November 30, 1970.; and
91	(c)  C is the normal retirement benefit credit brought
92	forward as of November 30, 1970, by a former member of an
93	existing system. The Such normal retirement benefit credit is
94	shall be determined as the product of X and Y where when X is
95	the percentage of average final compensation which the member
96	would have been eligible to receive if the member had attained
97	his or her normal retirement date by as of November 30, 1970,
98	all in accordance with the existing system under which the
99	member is covered on November 30, 1970, and Y is the member's
100	average final compensation as defined in s. 121.021(25).
101	However, any member of an existing retirement system who is
102	eligible to retire and who does retire, become disabled, or die
103	prior to April 15, 1971, may have his or her retirement benefits
104	calculated on the basis of the best 5 of the last 10 years of
105	service.
106	(d)  A member's average final compensation shall be
107	determined by formula using to obtain the coverage for the 5
108	highest fiscal years' salaries, calculated as provided by rule.
109	Section 2.  It is the intent of the Legislature that costs
110	attributable to benefit increases for Regular Class members of
111	the Florida Retirement System be funded by the recognition of
112	lump sums from the excess actuarial assets of the Florida
113	Retirement System Trust Fund as follows:
114	(1)  For the 2008-2009 fiscal year, the lump sum to be
115	recognized shall be the lesser of:
116	(a)  The amount available under the rate stabilization
117	mechanism described in s. 121.031, Florida Statutes; or
118	(b)  The amount needed to pay the annual cost attributable
119	to the increased benefit accrual rate for Regular Class members.
120	The annual cost is the increase in normal cost for Regular Class
121	members plus payment of the 30-year amortization amount of the
122	increase in the actuarial accrued liability attributable to the
123	increase, equal to 2.04 percent of the Regular Class member
124	payroll. If, after the recognition of excess actuarial assets
125	pursuant to this subsection, there remains an unfunded cost, the
126	contribution rate applicable to Regular Class members shall be
127	increased by the difference between the annual cost and the
128	amount provided by the excess actuarial assets unless the
129	Legislature provides an alternate funding mechanism.
130	(2)  For fiscal years beginning with 2009-2010, the
131	Legislature shall, as provided in subsection (1), continue to
132	fund on an ongoing basis the annual cost attributable to the
133	formula increase.
134	Section 3.  The Legislature finds and declares that a
135	legitimate state purpose is served when employees and retirees
136	of the state and its political subdivisions, and the dependents,
137	survivors, and beneficiaries of such employees and retirees, are
138	provided fair and adequate benefits that are managed,
139	administered, and funded in an actuarially sound manner, as
140	required by s. 14, Art. X of the State Constitution and part VII
141	of chapter 112, Florida Statutes.
142	Section 4.  This act shall take effect July 1, 2008.

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