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A bill to be entitled

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An act relating to the Florida Retirement System; amending

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s. 121.091, F.S.; revising the formula for calculating

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retirement benefits payable to Regular Class members to

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increase the benefit; providing for funding the benefit

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increase; providing a finding of important state interest;

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providing an effective date.

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Be It Enacted by the Legislature of the State of Florida:

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     Section 1.  Subsection (1) of section 121.091, Florida

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Statutes, is amended to read:

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     121.091  Benefits payable under the system.--Benefits may

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not be paid under this section unless the member has terminated

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employment as provided in s. 121.021(39)(a) or begun

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participation in the Deferred Retirement Option Program as

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provided in subsection (13), and a proper application has been

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filed in the manner prescribed by the department. The department

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may cancel an application for retirement benefits when the member

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or beneficiary fails to timely provide the information and

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documents required by this chapter and the department's rules.

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The department shall adopt rules establishing procedures for

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application for retirement benefits and for the cancellation of

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such application when the required information or documents are

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not received.

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     (1)  NORMAL RETIREMENT BENEFIT.--Upon attaining his or her

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normal retirement date and filing an application, the member,

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upon application to the administrator, shall receive a monthly

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benefit, which begins accruing which shall begin to accrue on the

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first day of the month of retirement and is be payable on the

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last day of that month and each month thereafter during the

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member's his or her lifetime. The normal retirement benefit,

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including any past or additional retirement credit, may not

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exceed 100 percent of the member's average final compensation.

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The amount of monthly benefit shall be calculated as the product

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of A and B, subject to the adjustment of C, if applicable, as set

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forth below:

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     (a)1.  For creditable years of Regular Class service, A is

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1.80 1.60 percent of the member's average final compensation, up

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to the member's normal retirement date. Upon completion of the

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first year after the normal retirement date, A is 1.63 percent of

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the member's average final compensation. Following the second

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year after the normal retirement date, A is 1.65 percent of the

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member's average final compensation. Following the third year

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after the normal retirement date, and for subsequent years, A is

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1.68 percent of the member's average final compensation.

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     2. For creditable years of Special Risk Class service, A

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is:

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     a.  Two percent of the member's average final compensation

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for all creditable years prior to October 1, 1974;

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     b.  Three percent of the member's average final compensation

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for all creditable years after September 30, 1974, and before

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October 1, 1978;

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     c.  Two percent of the member's average final compensation

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for all creditable years after September 30, 1978, and before

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January 1, 1989;

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     d.  Two and two-tenths percent of the member's final monthly

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compensation for all creditable years after December 31, 1988,

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and before January 1, 1990;

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     e.  Two and four-tenths percent of the member's average

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final compensation for all creditable years after December 31,

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1989, and before January 1, 1991;

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     f.  Two and six-tenths percent of the member's average final

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compensation for all creditable years after December 31, 1990,

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and before January 1, 1992;

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     g.  Two and eight-tenths percent of the member's average

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final compensation for all creditable years after December 31,

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1991, and before January 1, 1993;

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     h.  Three percent of the member's average final compensation

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for all creditable years after December 31, 1992; and

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     i.  Three percent of the member's average final compensation

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for all creditable years of service after September 30, 1978, and

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before January 1, 1993, for any special risk member who retires

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after July 1, 2000, or any member of the Special Risk

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Administrative Support Class entitled to retain the special risk

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normal retirement date who was a member of the Special Risk Class

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during the time period and who retires after July 1, 2000.

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     3.  For creditable years of Senior Management Service Class

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service after January 31, 1987, A is 2 percent.;

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     4.  For creditable years of Elected Officers' Class service

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as a Supreme Court Justice, district court of appeal judge,

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circuit judge, or county court judge, A is 3 1/3 percent of the

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member's average final compensation, and for all other creditable

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service in such class, A is 3 percent of the member's average

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final compensation.;

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     (b) B is the number of the member's years of creditable

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service and any fractional part of a year of creditable service

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earned subsequent to November 30, 1970.; and

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     (c)  C is the normal retirement benefit credit brought

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forward as of November 30, 1970, by a former member of an

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existing system. The Such normal retirement benefit credit is

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shall be determined as the product of X and Y where when X is the

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percentage of average final compensation which the member would

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have been eligible to receive if the member had attained his or

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her normal retirement date by as of November 30, 1970, all in

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accordance with the existing system under which the member is

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covered on November 30, 1970, and Y is the member's average final

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compensation as defined in s. 121.021(25). However, any member of

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an existing retirement system who is eligible to retire and who

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does retire, become disabled, or die prior to April 15, 1971, may

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have his or her retirement benefits calculated on the basis of

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the best 5 of the last 10 years of service.

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     (d)  A member's average final compensation shall be

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determined by formula using to obtain the coverage for the 5

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highest fiscal years' salaries, calculated as provided by rule.

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     Section 2. It is the intent of the Legislature that costs

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attributable to benefit increases for Regular Class members of

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the Florida Retirement System be funded by the recognition of

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lump sums from the excess actuarial assets of the Florida

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Retirement System Trust Fund as follows:

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     (1) For the 2008-2009 fiscal year, the lump sum to be

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recognized shall be the lesser of:

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     (a) The amount available under the rate stabilization

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mechanism described in s. 121.031, Florida Statutes; or

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     (b) The amount needed to pay the annual cost attributable

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to the increased benefit accrual rate for Regular Class members.

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The annual cost is the increase in normal cost for Regular Class

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members plus payment of the 30-year amortization amount of the

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increase in the actuarial accrued liability attributable to the

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increase, equal to 2.04 percent of the Regular Class member

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payroll. If, after the recognition of excess actuarial assets

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pursuant to this subsection, there remains an unfunded cost, the

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contribution rate applicable to Regular Class members shall be

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increased by the difference between the annual cost and the

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amount provided by the excess actuarial assets unless the

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Legislature provides an alternate funding mechanism.

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     (2) For fiscal years beginning with 2009-2010, the

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Legislature shall, as provided in subsection (1), continue to

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fund on an ongoing basis the annual cost attributable to the

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formula increase.

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     Section 3. The Legislature finds and declares that a

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legitimate state purpose is served when employees and retirees of

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the state and its political subdivisions, and the dependents,

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survivors, and beneficiaries of such employees and retirees, are

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provided fair and adequate benefits that are managed,

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administered, and funded in an actuarially sound manner, as

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required by s. 14, Art. X of the State Constitution and part VII

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of chapter 112, Florida Statutes.

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     Section 4.  This act shall take effect July 1, 2008.