Florida Senate - 2011 COMMITTEE AMENDMENT
Bill No. SB 1130
Barcode 200064
LEGISLATIVE ACTION
Senate . House
Comm: RCS .
03/10/2011 .
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The Committee on Governmental Oversight and Accountability
(Ring) recommended the following:
1 Senate Amendment (with title amendment)
2
3 Delete everything after the enacting clause
4 and insert:
5 Section 1. Paragraph (g) of subsection (2) of section
6 110.123, Florida Statutes, is amended to read:
7 110.123 State group insurance program.—
8 (2) DEFINITIONS.—As used in this section, the term:
9 (g) “Retired state officer or employee” or “retiree” means
10 a any state, or state university, officer or employee who
11 retires under a state retirement system or a state optional
12 annuity or retirement program or is placed on disability
13 retirement, and who was insured under the state group insurance
14 program at the time of retirement, and who begins receiving
15 retirement benefits immediately after retirement from state or
16 state university office or employment. The term also includes In
17 addition to these requirements, any state officer or state
18 employee who retires under the investment plan Public Employee
19 Optional Retirement program established under part II of chapter
20 121 shall be considered a “retired state officer or employee” or
21 “retiree” as used in this section if he or she:
22 1. Meets the age and service requirements to qualify for
23 normal retirement as set forth in s. 121.021(29); or
24 2. Has attained the age specified by s. 72(t)(2)(A)(i) of
25 the Internal Revenue Code and has 6 years of creditable service.
26 Section 2. Section 112.0801, Florida Statutes, is amended
27 to read:
28 112.0801 Group insurance; participation by retired
29 employees.—
30 (1) Any state agency, county, municipality, special
31 district, community college, or district school board that which
32 provides life, health, accident, hospitalization, or annuity
33 insurance, or all of any kinds of such insurance, for its
34 officers and employees and their dependents upon a group
35 insurance plan or self-insurance plan shall allow all former
36 personnel who have retired before prior to October 1, 1987, as
37 well as those who retire on or after such date, and their
38 eligible dependents, the option of continuing to participate in
39 the such group insurance plan or self-insurance plan. Retirees
40 and their eligible dependents shall be offered the same health
41 and hospitalization insurance coverage as is offered to active
42 employees at a premium cost of no more than the premium cost
43 applicable to active employees. For the retired employees and
44 their eligible dependents, the cost of any such continued
45 participation in any type of plan or any of the cost thereof may
46 be paid by the employer or by the retired employees. To
47 determine health and hospitalization plan costs, the employer
48 shall commingle the claims experience of the retiree group with
49 the claims experience of the active employees; and, for other
50 types of coverage, the employer may commingle the claims
51 experience of the retiree group with the claims experience of
52 active employees. Retirees covered under Medicare may be
53 experience-rated separately from the retirees not covered by
54 Medicare and from active employees if, provided that the total
55 premium does not exceed that of the active group and coverage is
56 basically the same as for the active group.
57 (2) For purposes of this section, the term “retiree” has
58 the same meaning as in s. 110.123(2) means any officer or
59 employee who retires under a state retirement system or a state
60 optional annuity or retirement program or is placed on
61 disability retirement and who begins receiving retirement
62 benefits immediately after retirement from employment. In
63 addition to these requirements, any officer or employee who
64 retires under the Public Employee Optional Retirement Program
65 established under part II of chapter 121 shall be considered a
66 “retired officer or employee” or “retiree” as used in this
67 section if he or she:
68 (a) Meets the age and service requirements to qualify for
69 normal retirement as set forth in s. 121.021(29); or
70 (b) Has attained the age specified by s. 72(t)(2)(A)(i) of
71 the Internal Revenue Code and has 6 years of creditable service.
72 Section 3. Paragraphs (b) and (c) of subsection (2) and
73 paragraph (e) of subsection (3) of section 112.363, Florida
74 Statutes, are amended to read:
75 112.363 Retiree health insurance subsidy.—
76 (2) ELIGIBILITY FOR RETIREE HEALTH INSURANCE SUBSIDY.—
77 (b) For purposes of this section, a person is deemed
78 retired from a state-administered retirement system when he or
79 she terminates employment with all employers participating in
80 the Florida Retirement System as described in s. 121.021(39)
81 and:
82 1. For a member participant of the investment plan Public
83 Employee Optional Retirement program established under part II
84 of chapter 121, the member participant meets the age or service
85 requirements to qualify for normal retirement as set forth in s.
86 121.021(29) and meets the definition of retiree in s.
87 121.4501(2).
88 2. For a member of the pension plan Florida Retirement
89 System defined benefit program, or any employee who maintains
90 creditable service under both the pension plan and the
91 investment plan defined benefit program and the Public Employee
92 Optional Retirement program, the member begins drawing
93 retirement benefits from the pension plan defined benefit
94 program of the Florida Retirement System.
95 (c)1. Effective July 1, 2001, any person retiring on or
96 after that such date as a member of the Florida Retirement
97 System, including a member any participant of the investment
98 plan defined contribution program administered pursuant to part
99 II of chapter 121, must have satisfied the vesting requirements
100 for his or her membership class under the pension plan Florida
101 Retirement System defined benefit program as administered under
102 part I of chapter 121. However,
103 2. Notwithstanding the provisions of subparagraph 1., a
104 person retiring due to disability must either qualify for a
105 regular or in-line-of-duty disability benefit as provided in s.
106 121.091(4) or qualify for a disability benefit under a
107 disability plan established under part II of chapter 121, as
108 appropriate.
109 (3) RETIREE HEALTH INSURANCE SUBSIDY AMOUNT.—
110 (e)1. Beginning July 1, 2001, each eligible retiree of the
111 pension plan defined benefit program of the Florida Retirement
112 System, or, if the retiree is deceased, his or her beneficiary
113 who is receiving a monthly benefit from such retiree’s account
114 and who is a spouse, or a person who meets the definition of
115 joint annuitant in s. 121.021(28), shall receive a monthly
116 retiree health insurance subsidy payment equal to the number of
117 years of creditable service, as defined in s. 121.021(17),
118 completed at the time of retirement multiplied by $5; however,
119 an no eligible retiree or beneficiary may not receive a subsidy
120 payment of more than $150 or less than $30. If there are
121 multiple beneficiaries, the total payment may must not be
122 greater than the payment to which the retiree was entitled. The
123 health insurance subsidy amount payable to any person receiving
124 the retiree health insurance subsidy payment on July 1, 2001,
125 may shall not be reduced solely by operation of this
126 subparagraph.
127 2. Beginning July 1, 2002, each eligible member participant
128 of the investment plan under part II of chapter 121 Public
129 Employee Optional Retirement program of the Florida Retirement
130 System who has met the requirements of this section, or, if the
131 member participant is deceased, his or her spouse who is the
132 member’s participant’s designated beneficiary, shall receive a
133 monthly retiree health insurance subsidy payment equal to the
134 number of years of creditable service, as provided in this
135 subparagraph, completed at the time of retirement, multiplied by
136 $5; however, an no eligible retiree or beneficiary may not
137 receive a subsidy payment of more than $150 or less than $30.
138 For purposes of determining a member’s participant’s creditable
139 service used to calculate the health insurance subsidy, the
140 member’s a participant’s years of service credit or fraction
141 thereof must shall be based on the member’s participant’s work
142 year as defined in s. 121.021(54). Credit must shall be awarded
143 for a full work year if whenever health insurance subsidy
144 contributions have been made as required by law for each month
145 in the member’s participant’s work year. In addition, all years
146 of creditable service retained under the Florida Retirement
147 System pension plan must defined benefit program shall be
148 included as creditable service for purposes of this section.
149 Notwithstanding any other provision in this section to the
150 contrary, the spouse at the time of death is shall be the
151 member’s participant’s beneficiary unless such member
152 participant has designated a different beneficiary subsequent to
153 the member’s participant’s most recent marriage.
154 Section 4. Subsection (1) of section 112.65, Florida
155 Statutes, is amended to read:
156 112.65 Limitation of benefits.—
157 (1) ESTABLISHMENT OF PROGRAM.—The normal retirement benefit
158 or pension payable to a retiree who becomes a member of a any
159 retirement system or plan and who has not previously
160 participated in such plan, on or after January 1, 1980, may
161 shall not exceed 100 percent of his or her average final
162 compensation. However, nothing contained in this section does
163 not shall apply to supplemental retirement benefits or to
164 pension increases attributable to cost-of-living increases or
165 adjustments. For the purposes of this section, benefits accruing
166 in individual member participant accounts established under the
167 investment plan Public Employee Optional Retirement program
168 established in part II of chapter 121 are considered
169 supplemental benefits. As used in this section, the term
170 “average final compensation” means the average of the member’s
171 earnings over a period of time which the governmental entity
172 establishes has established by statute, charter, or ordinance.
173 Section 5. Paragraph (h) is added to subsection (3) of
174 section 121.011, Florida Statutes, to read:
175 121.011 Florida Retirement System.—
176 (3) PRESERVATION OF RIGHTS.—
177 (h) Effective July 1, 2011, the retirement system shall
178 require employee and employer contributions as provided in s.
179 121.071 and part III of this chapter.
180 Section 6. Subsection (3), paragraph (a) of subsection
181 (19), paragraphs (a) and (b) of subsection (22), subsection
182 (24), paragraph (b) of subsection (45), subsection (55), and
183 subsection (59) of section 121.021, Florida Statutes, are
184 amended to read:
185 121.021 Definitions.—The following words and phrases as
186 used in this chapter have the respective meanings set forth
187 unless a different meaning is plainly required by the context:
188 (3) “Florida Retirement System” or “system” means the
189 general retirement system established by this chapter, to be
190 known and cited as the “Florida Retirement System,” including,
191 but not limited to, the defined benefit retirement program or
192 pension plan administered under the provisions of part I of this
193 part chapter and the defined contribution retirement program or
194 investment plan known as the Public Employee Optional Retirement
195 Program and administered under the provisions of part II of this
196 chapter.
197 (19) “Prior service” under this chapter means:
198 (a) Service for which the member had credit under one of
199 the existing systems and received a refund of his or her
200 contributions upon termination of employment. Prior service
201 shall also includes include that service between December 1,
202 1970, and the date the system becomes noncontributory for which
203 the member had credit under the Florida Retirement System and
204 received a refund of his or her contributions upon termination
205 of employment.
206 (22) “Compensation” means the monthly salary paid a member
207 by his or her employer for work performed arising from that
208 employment.
209 (a) For service earned before July 1, 2011, compensation
210 includes shall include:
211 1. Overtime payments paid from a salary fund.
212 2. Accumulated annual leave payments.
213 3. Payments in addition to the employee’s base rate of pay
214 if all the following apply:
215 a. The payments are paid according to a formal written
216 policy that applies to all eligible employees equally;
217 b. The policy provides that payments shall commence by no
218 later than the 11th year of employment;
219 c. The payments are paid for as long as the employee
220 continues his or her employment; and
221 d. The payments are paid at least annually.
222 4. Amounts withheld for tax sheltered annuities or deferred
223 compensation programs, or any other type of salary reduction
224 plan authorized under the Internal Revenue Code.
225 5. Payments made in lieu of a permanent increase in the
226 base rate of pay, whether made annually or in 12 or 26 equal
227 payments within a 12-month period, if when the member’s base pay
228 is at the maximum of his or her pay range. If When a portion of
229 a member’s annual increase raises his or her pay range and the
230 excess is paid as a lump sum payment, the such lump sum payment
231 is considered shall be compensation for retirement purposes.
232 (b) For service earned on or after July 1, 2011,
233 compensation includes:
234 1. Payments in addition to the employee’s base rate of pay
235 if the following apply:
236 a. The payments are paid according to a formal written
237 policy that applies to all eligible employees equally;
238 b. The policy provides that payments shall commence by 11th
239 year of employment; and
240 c. The payments are paid at least annually.
241 2. Amounts withheld for tax sheltered annuities, deferred
242 compensation programs, or any other type of salary reduction
243 plan authorized under the Internal Revenue Code.
244 3. Payments made in lieu of a permanent increase in the
245 base rate of pay, whether made annually or in 12 or 26 equal
246 payments within a 12-month period, if the member’s base pay is
247 at the maximum of his or her pay range. If a portion of a
248 member’s annual increase raises his or her pay range and the
249 excess is paid as a lump sum payment, such lump sum payment is
250 compensation for retirement purposes.
251 (c)(b) Under no circumstances shall Compensation for a
252 member participating in the pension plan defined benefit
253 retirement program or the investment plan Public Employee
254 Optional Retirement Program of the Florida Retirement System may
255 not include:
256 1. Fees paid professional persons for special or particular
257 services or include salary payments made from a faculty practice
258 plan authorized by the Board of Governors of the State
259 University System for eligible clinical faculty at a college in
260 a state university that has a faculty practice plan; or
261 2. Any bonuses or other payments prohibited from inclusion
262 in the member’s average final compensation and defined in
263 subsection (47).
264 (24) “Average final compensation” means the average of the
265 5 highest fiscal years of compensation for creditable service
266 prior to retirement, termination, or death. For in-line-of-duty
267 disability benefits, if less than 5 years of creditable service
268 have been completed, the term “average final compensation” means
269 the average annual compensation of the total number of years of
270 creditable service. Each year used to calculate in the
271 calculation of average final compensation commences shall
272 commence on July 1.
273 (a) For service earned before July 1, 2011:
274 1. The average final compensation includes shall include:
275 a.1. Accumulated annual leave payments, not to exceed 500
276 hours; and
277 b.2. All payments defined as compensation under this
278 section in subsection (22).
279 2.(b) The average final compensation does shall not
280 include:
281 a.1. Compensation paid to professional persons for special
282 or particular services;
283 b.2. Payments for accumulated sick leave made due to
284 retirement or termination;
285 c.3. Payments for accumulated annual leave in excess of 500
286 hours;
287 d.4. Bonuses as defined in subsection (47);
288 e.5. Third-party Third party payments made on and after
289 July 1, 1990; or
290 f.6. Fringe benefits, such as (for example, automobile
291 allowances or housing allowances).
292 (b) For service earned on or after July 1, 2011:
293 1. The average final compensation includes all payments
294 defined as compensation under this section.
295 2. The average final compensation does not include:
296 a. Compensation paid to professional persons for special or
297 particular services;
298 b. Payments for accumulated sick leave made due to
299 retirement or termination;
300 c. Payments for accumulated annual leave;
301 d. Overtime payments paid from a salary fund;
302 e. Bonuses;
303 f. Third-party payments made on and after July 1, 1990; or
304 g. Fringe benefits, such as automobile allowances or
305 housing allowances.
306 (45)
307 (b) Effective July 1, 2001, a 6-year vesting requirement
308 shall be implemented for the defined benefit program of the
309 Florida Retirement System’s pension plan System. Pursuant
310 thereto:
311 1. Any member employed in a regularly established position
312 on July 1, 2001, who completes or has completed a total of 6
313 years of creditable service is shall be considered vested as
314 described in paragraph (a).
315 2. Any member not employed in a regularly established
316 position on July 1, 2001, shall be deemed vested upon completion
317 of 6 years of creditable service if, provided that such member
318 is employed in a covered position for at least 1 work year after
319 July 1, 2001. However, a no member may not shall be required to
320 complete more years of creditable service than would have been
321 required for that member to vest under retirement laws in effect
322 before July 1, 2001.
323 (55) “Benefit” means any pension payment, lump-sum or
324 periodic, to a member, retiree, or beneficiary, based partially
325 or entirely on employer and employee contributions as
326 applicable.
327 (59) “Payee” means a retiree or beneficiary of a retiree
328 who has received or is receiving a retirement benefit payment.
329 Section 7. Paragraphs (b), (c), and (d) of subsection (2)
330 of section 121.051, Florida Statutes, are amended, present
331 paragraphs (e) and (f) of that subsection are redesignated as
332 subsections (f) and (g), respectively, a new subsection (e) is
333 added to that subsection, and subsection (3) of that section is
334 amended, to read:
335 121.051 Participation in the system.—
336 (2) OPTIONAL PARTICIPATION.—
337 (b)1. The governing body of any municipality, metropolitan
338 planning organization, or special district in the state may
339 elect to participate in the Florida Retirement System upon
340 proper application to the administrator and may cover all or any
341 of its units as approved by the Secretary of Health and Human
342 Services and the administrator. The department shall adopt rules
343 establishing procedures provisions for the submission of
344 documents necessary for such application. Before Prior to being
345 approved for participation in the Florida Retirement System, the
346 governing body of a any such municipality, metropolitan planning
347 organization, or special district that has a local retirement
348 system must shall submit to the administrator a certified
349 financial statement showing the condition of the local
350 retirement system as of a date within 3 months before prior to
351 the proposed effective date of membership in the Florida
352 Retirement system. The statement must be certified by a
353 recognized accounting firm that is independent of the local
354 retirement system. All required documents necessary for
355 extending Florida Retirement System coverage must be received by
356 the department for consideration at least 15 days before prior
357 to the proposed effective date of coverage. If the governing
358 body municipality, metropolitan planning organization, or
359 special district does not comply with this requirement, the
360 department may require that the effective date of coverage be
361 changed.
362 2. A municipality Any city, metropolitan planning
363 organization, or special district that has an existing
364 retirement system covering the employees in the units that are
365 to be brought under the Florida Retirement System may
366 participate only after holding a referendum in which all
367 employees in the affected units have the right to participate.
368 Only those employees electing coverage under the Florida
369 Retirement System by affirmative vote in the said referendum are
370 shall be eligible for coverage under this chapter, and those not
371 participating or electing not to be covered by the Florida
372 Retirement System shall remain in their present systems and are
373 shall not be eligible for coverage under this chapter. After the
374 referendum is held, all future employees are shall be compulsory
375 members of the Florida Retirement System.
376 3. At the time of joining the Florida Retirement System,
377 the governing body of a municipality any city, metropolitan
378 planning organization, or special district complying with
379 subparagraph 1. may elect to provide, or not provide, benefits
380 based on past service of officers and employees as described in
381 s. 121.081(1). However, if such employer elects to provide past
382 service benefits, such benefits must be provided for all
383 officers and employees of its covered group.
384 4. Once this election is made and approved it may not be
385 revoked, except pursuant to subparagraphs 5. and 6., and all
386 present officers and employees electing coverage under this
387 chapter and all future officers and employees are shall be
388 compulsory members of the Florida Retirement System.
389 5. Subject to the conditions set forth in subparagraph 6.,
390 the governing body of a any hospital licensed under chapter 395
391 which is governed by the board of a special district as defined
392 in s. 189.403(1) or by the board of trustees of a public health
393 trust created under s. 154.07, hereinafter referred to as
394 “hospital district,” and which participates in the Florida
395 Retirement System, may elect to cease participation in the
396 system with regard to future employees in accordance with the
397 following procedure:
398 a. No more than 30 days and at least 7 days before
399 adopting a resolution to partially withdraw from the Florida
400 Retirement system and establish an alternative retirement plan
401 for future employees, a public hearing must be held on the
402 proposed withdrawal and proposed alternative plan.
403 b. From 7 to 15 days before such hearing, notice of intent
404 to withdraw, specifying the time and place of the hearing, must
405 be provided in writing to employees of the hospital district
406 proposing partial withdrawal and must be published in a
407 newspaper of general circulation in the area affected, as
408 provided by ss. 50.011-50.031. Proof of publication must of such
409 notice shall be submitted to the department of Management
410 Services.
411 c. The governing body of a any hospital district seeking to
412 partially withdraw from the system must, before such hearing,
413 have an actuarial report prepared and certified by an enrolled
414 actuary, as defined in s. 112.625(3), illustrating the cost to
415 the hospital district of providing, through the retirement plan
416 that the hospital district is to adopt, benefits for new
417 employees comparable to those provided under the Florida
418 Retirement system.
419 d. Upon meeting all applicable requirements of this
420 subparagraph, and subject to the conditions set forth in
421 subparagraph 6., partial withdrawal from the system and adoption
422 of the alternative retirement plan may be accomplished by
423 resolution duly adopted by the hospital district board. The
424 hospital district board must provide written notice of such
425 withdrawal to the Division of Retirement by mailing a copy of
426 the resolution to the division, postmarked by no later than
427 December 15, 1995. The withdrawal shall take effect January 1,
428 1996.
429 6. Following the adoption of a resolution under sub
430 subparagraph 5.d., all employees of the withdrawing hospital
431 district who were members of participants in the Florida
432 Retirement system before prior to January 1, 1996, shall remain
433 as members of participants in the system for as long as they are
434 employees of the hospital district, and all rights, duties, and
435 obligations between the hospital district, the system, and the
436 employees shall remain in full force and effect. Any employee
437 who is hired or appointed on or after January 1, 1996, may not
438 participate in the Florida Retirement system, and the
439 withdrawing hospital district has shall have no obligation to
440 the system with respect to such employees.
441 (c) Employees of public community colleges or charter
442 technical career centers sponsored by public community colleges,
443 designated in s. 1000.21(3), who are members of the Regular
444 Class of the Florida Retirement System and who comply with the
445 criteria set forth in this paragraph and s. 1012.875 may, in
446 lieu of participating in the Florida Retirement System, elect to
447 withdraw from the system altogether and participate in the State
448 Community College System Optional Retirement Program provided by
449 the employing agency under s. 1012.875.
450 1. Through June 30, 2001, the cost to the employer for a
451 benefit under the optional retirement program such annuity
452 equals the normal cost portion of the employer retirement
453 contribution which would be required if the employee were a
454 member of the Regular Class pension plan defined benefit
455 program, plus the portion of the contribution rate required by
456 s. 112.363(8) which would otherwise be assigned to the Retiree
457 Health Insurance Subsidy Trust Fund. Effective July 1, 2001,
458 each employer shall contribute on behalf of each member of
459 participant in the optional program an amount equal to 10.43
460 percent of the employee’s participant’s gross monthly
461 compensation. The employer shall deduct an amount for the
462 administration of the program. The employer shall contribute an
463 additional amount to the Florida Retirement System Trust Fund
464 equal to the unfunded actuarial accrued liability portion of the
465 Regular Class contribution rate.
466 2. The decision to participate in the an optional
467 retirement program is irrevocable as long as the employee holds
468 a position eligible for participation, except as provided in
469 subparagraph 3. Any service creditable under the Florida
470 Retirement System is retained after the member withdraws from
471 the system; however, additional service credit in the system may
472 not be earned while a member of the optional retirement program.
473 3. An employee who has elected to participate in the
474 optional retirement program shall have one opportunity, at the
475 employee’s discretion, to transfer from the optional retirement
476 program to the defined benefit program of the Florida Retirement
477 System’s pension plan System or to the investment plan
478 established under part II of this chapter Public Employee
479 Optional Retirement Program, subject to the terms of the
480 applicable optional retirement program contracts.
481 a. If the employee chooses to move to the investment plan
482 Public Employee Optional Retirement program, any contributions,
483 interest, and earnings creditable to the employee under the
484 State Community College System optional retirement program are
485 retained by the employee in the State Community College System
486 optional retirement program, and the applicable provisions of s.
487 121.4501(4) govern the election.
488 b. If the employee chooses to move to the pension plan
489 defined benefit program of the Florida Retirement System, the
490 employee shall receive service credit equal to his or her years
491 of service under the State Community College System optional
492 retirement program.
493 (I) The cost for such credit is the amount representing the
494 present value of the employee’s accumulated benefit obligation
495 for the affected period of service. The cost shall be calculated
496 as if the benefit commencement occurs on the first date the
497 employee becomes eligible for unreduced benefits, using the
498 discount rate and other relevant actuarial assumptions that were
499 used to value the pension Florida Retirement System defined
500 benefit plan liabilities in the most recent actuarial valuation.
501 The calculation must include any service already maintained
502 under the pension defined benefit plan in addition to the years
503 under the State Community College System optional retirement
504 program. The present value of any service already maintained
505 must be applied as a credit to total cost resulting from the
506 calculation. The division shall ensure that the transfer sum is
507 prepared using a formula and methodology certified by an
508 enrolled actuary.
509 (II) The employee must transfer from his or her State
510 Community College System optional retirement program account and
511 from other employee moneys as necessary, a sum representing the
512 present value of the employee’s accumulated benefit obligation
513 immediately following the time of such movement, determined
514 assuming that attained service equals the sum of service in the
515 pension plan defined benefit program and service in the State
516 Community College System optional retirement program.
517 4. Participation in the optional retirement program is
518 limited to employees who satisfy the following eligibility
519 criteria:
520 a. The employee is must be otherwise eligible for
521 membership or renewed membership in the Regular Class of the
522 Florida Retirement System, as provided in s. 121.021(11) and
523 (12) or s. 121.122.
524 b. The employee is must be employed in a full-time position
525 classified in the Accounting Manual for Florida’s Public
526 Community Colleges as:
527 (I) Instructional; or
528 (II) Executive Management, Instructional Management, or
529 Institutional Management and the, if a community college
530 determines that recruiting to fill a vacancy in the position is
531 to be conducted in the national or regional market, and the
532 duties and responsibilities of the position include the
533 formulation, interpretation, or implementation of policies, or
534 the performance of functions that are unique or specialized
535 within higher education and that frequently support the mission
536 of the community college.
537 c. The employee is must be employed in a position not
538 included in the Senior Management Service Class of the Florida
539 Retirement System, as described in s. 121.055.
540 5. Members of Participants in the program are subject to
541 the same reemployment limitations, renewed membership
542 provisions, and forfeiture provisions as are applicable to
543 regular members of the Florida Retirement System under ss.
544 121.091(9), 121.122, and 121.091(5), respectively. A member
545 participant who receives a program distribution funded by
546 employer contributions is shall be deemed to be retired from a
547 state-administered retirement system if the retiree participant
548 is subsequently employed with an employer that participates in
549 the Florida Retirement System.
550 6. Eligible community college employees are compulsory
551 members of the Florida Retirement System until, pursuant to s.
552 1012.875, a written election to withdraw from the system and
553 participate in the State Community College System optional
554 retirement program is filed with the program administrator and
555 received by the division.
556 a. A community college employee whose program eligibility
557 results from initial employment shall must be enrolled in the
558 State Community College System optional retirement program
559 retroactive to the first day of eligible employment. The
560 employer retirement contributions paid through the month of the
561 employee plan change shall be transferred to the community
562 college to the employee’s optional program account, and,
563 effective the first day of the next month, the employer shall
564 pay the applicable contributions based upon subparagraph 1.
565 b. A community college employee whose program eligibility
566 is due to the subsequent designation of the employee’s position
567 as one of those specified in subparagraph 4., or due to the
568 employee’s appointment, promotion, transfer, or reclassification
569 to a position specified in subparagraph 4., must be enrolled in
570 the program on the first day of the first full calendar month
571 that such change in status becomes effective. The employer
572 retirement contributions paid from the effective date through
573 the month of the employee plan change must be transferred to the
574 community college to the employee’s optional program account,
575 and, effective the first day of the next month, the employer
576 shall pay the applicable contributions based upon subparagraph
577 1.
578 7. Effective July 1, 2003, through December 31, 2008, any
579 member participant of the State Community College System
580 optional retirement program who has service credit in the
581 pension defined benefit plan of the Florida Retirement System
582 for the period between his or her first eligibility to transfer
583 from the pension defined benefit plan to the optional retirement
584 program and the actual date of transfer may, during employment,
585 transfer to the optional retirement program a sum representing
586 the present value of the accumulated benefit obligation under
587 the pension plan defined benefit retirement program for the
588 period of service credit. Upon transfer, all service credit
589 previously earned under the pension plan defined benefit program
590 of the Florida Retirement System during this period is nullified
591 for purposes of entitlement to a future benefit under the
592 pension plan defined benefit program of the Florida Retirement
593 System.
594 (d) The governing body of a charter school or a charter
595 technical career center may elect to participate in the system
596 upon proper application to the administrator and shall cover its
597 units as approved by the Secretary of Health and Human Services
598 and the administrator. At the time of joining the Florida
599 Retirement System, but before July 1, 2011, the governing body
600 of the charter school may elect to provide, or not provide,
601 benefits based on the past service of officers and employees as
602 described in s. 121.081(1). Once this election is made and
603 approved, it may not be revoked, and all present officers and
604 employees selecting coverage under this chapter and all future
605 officers and employees shall be compulsory members of the
606 Florida Retirement System.
607 (e) All eligible employees initially enrolled on or after
608 July 1, 2011, except those who are eligible to and elect to
609 enroll in an optional retirement program established under s.
610 121.055(6), s. 121.35, or s. 1012.875, become compulsory members
611 of the investment plan and membership in the pension plan is not
612 permitted. Employees initially enrolled on or after July 1,
613 2011, may not use the election opportunity specified in s.
614 121.4501(4)(e).
615 (3) SOCIAL SECURITY COVERAGE.—Social security coverage
616 shall be provided for all officers and employees who become
617 members under the provisions of subsection (1) or subsection
618 (2). Any modification of the present agreement with the Social
619 Security Administration, or referendum required under the Social
620 Security Act, for the purpose of providing social security
621 coverage for any member shall be requested by the state agency
622 in compliance with the applicable provisions of the Social
623 Security Act governing such coverage. However, retroactive
624 social security coverage for service prior to December 1, 1970,
625 with the employer before December 1, 1970, may shall not be
626 provided for a any member who was not covered under the
627 agreement as of November 30, 1970.
628 Section 8. Paragraph (b) of subsection (5), paragraph (a)
629 of subsection (7), and paragraph (c) of subsection (9) of
630 section 121.0515, Florida Statutes, are amended to read:
631 121.0515 Special risk membership.—
632 (5) CREDIT FOR PAST SERVICE.—A special risk member may
633 purchase retirement credit in the Special Risk Class based upon
634 past service, and may upgrade retirement credit for such past
635 service, to the extent of 2 percent of the member’s average
636 monthly compensation as specified in s. 121.091(1)(a) for such
637 service as follows:
638 (b) Contributions for upgrading the additional special risk
639 credit are pursuant to this subsection shall be equal to the
640 difference in the employer and, if applicable, employee
641 contributions paid and the special risk percentage rate of gross
642 salary in effect at the time of purchase for the period being
643 claimed, plus interest thereon at the rate of 4 percent a year
644 compounded annually from the date of such service until July 1,
645 1975, and 6.5 percent a year thereafter until the date of
646 payment. This Past service may be purchased by the member or by
647 the employer on behalf of the member.
648 (7) RETENTION OF SPECIAL RISK NORMAL RETIREMENT DATE.—
649 (a) A special risk member who is moved or reassigned to a
650 nonspecial risk law enforcement, firefighting, correctional, or
651 emergency medical care administrative support position within
652 with the same agency, or who is subsequently employed in such a
653 position with any law enforcement, firefighting, correctional,
654 or emergency medical care agency under the Florida Retirement
655 System, shall participate in the Special Risk Administrative
656 Support Class and shall earn credit for such service at the same
657 percentage rate as that earned by a regular member.
658 Notwithstanding the provisions of subsection (4), service in
659 such an administrative support position shall, for purposes of
660 s. 121.091, applies apply toward satisfaction of the special
661 risk normal retirement date, as defined in s. 121.021(29)(b) if,
662 provided that, while in such position, the member remains
663 certified as a law enforcement officer, firefighter,
664 correctional officer, emergency medical technician, or
665 paramedic; remains subject to reassignment at any time to a
666 position qualifying for special risk membership; and completes
667 an aggregate of 6 or more years of service as a designated
668 special risk member before prior to retirement.
669 (9) CREDIT FOR UPGRADED SERVICE.—
670 (c) Any member of the Special Risk Class who has earned
671 creditable service in another membership class of the Florida
672 Retirement System in a position with the Department of Law
673 Enforcement or the Division of State Fire Marshal and became
674 covered by the Special Risk Class as described in paragraph
675 (2)(i), or with a local government law enforcement agency or
676 medical examiner’s office and became covered by the Special Risk
677 Class as described in paragraph (2)(j), which service is within
678 the purview of the Special Risk Class, and is employed in such
679 position on or after July 1, 2008, may purchase additional
680 retirement credit to upgrade such service to Special Risk Class
681 service, to the extent of the percentages of the member’s
682 average final compensation provided in s. 121.091(1)(a)2. The
683 cost for such credit must shall be an amount representing the
684 actuarial accrued liability for the difference in accrual value
685 during the affected period of service. The cost shall be
686 calculated using the discount rate and other relevant actuarial
687 assumptions that were used to value the Florida Retirement
688 System’s pension System defined benefit plan liabilities in the
689 most recent actuarial valuation. The Division of Retirement
690 shall ensure that the transfer sum is prepared using a formula
691 and methodology certified by an enrolled actuary. The cost must
692 be paid immediately upon notification by the division. The local
693 government employer may purchase the upgraded service credit on
694 behalf of the member if the member has been employed by that
695 employer for at least 3 years.
696 Section 9. Paragraphs (a) and (d) of subsection (4) and
697 paragraph (b) of subsection (7) of section 121.052, Florida
698 Statutes, are amended, present paragraph (c) of subsection (7)
699 of that section is redesignated as paragraph (d), a new
700 paragraph (c) is added to that subsection, and subsection (8) of
701 that section is amended, to read:
702 121.052 Membership class of elected officers.—
703 (4) PARTICIPATION BY ELECTED OFFICERS SERVING A SHORTENED
704 TERM DUE TO APPORTIONMENT, FEDERAL INTERVENTION, ETC.—
705 (a) An Any duly elected officer whose term of office was
706 shortened by legislative or judicial apportionment pursuant to
707 the provisions of s. 16, Art. III of the State Constitution may,
708 after the term of office to which he or she was elected is
709 completed, pay into the Florida Retirement System Trust Fund the
710 amount of contributions that would have been made by the officer
711 or the officer’s employer on his or her behalf, plus 4 percent
712 interest compounded annually from the date he or she left office
713 until July 1, 1975, and 6.5 percent interest compounded annually
714 thereafter, and may receive service credit for the length of
715 time the officer would have served if such term had not been
716 shortened by apportionment.
717 (d)1. Any justice or judge, or any retired justice or judge
718 who retired before July 1, 1993, who has attained the age of 70
719 years and who is prevented under s. 8, Art. V of the State
720 Constitution from completing his or her term of office because
721 of age may elect to purchase credit for all or a portion of the
722 months he or she would have served during the remainder of the
723 term of office; however, but he or she may claim those months
724 only after the date the service would have occurred. The justice
725 or judge must pay into the Florida Retirement System Trust Fund
726 the amount of contributions that would have been made by the
727 employer on his or her behalf for the period of time being
728 claimed, plus 6.5 percent interest thereon compounded each June
729 30 from the date he or she left office, in order to receive
730 service credit in this class for the period of time being
731 claimed. After the date the service would have occurred, and
732 upon payment of the required contributions, the retirement
733 benefit of a retired justice or judge shall will be adjusted
734 prospectively to include the this additional creditable service;
735 however, such adjustment may be made only once.
736 2. Any justice or judge who does not seek election to a
737 subsequent term of office because he or she would be prevented
738 under s. 8, Art. V of the State Constitution from completing
739 such term of office upon attaining the age of 70 years may elect
740 to purchase service credit for service as a temporary judge as
741 assigned by the court if the temporary assignment follows
742 immediately follows the last full term of office served and the
743 purchase is limited to the number of months of service needed to
744 vest retirement benefits. To receive retirement credit for such
745 temporary service beyond termination, the justice or judge must
746 pay into the Florida Retirement System Trust Fund the amount of
747 contributions that would have been made by the justice or judge
748 and the employer on his or her behalf had he or she continued in
749 office for the period of time being claimed, plus 6.5 percent
750 interest thereon compounded each June 30 from the date he or she
751 left office.
752 (7) CONTRIBUTIONS.—
753 (b) The employer paying the salary of a member of the
754 Elected Officers’ Class shall contribute an amount as specified
755 in this subsection or s. 121.71, as appropriate, which shall
756 constitute the entire employer retirement contribution with
757 respect to such member. The employer shall also withhold one
758 half of the entire contribution of the member required for
759 social security coverage. Effective July 1, 2011, members of the
760 Elected Officers’ Class shall pay retirement contributions as
761 specified in s. 121.71.
762 (c) If a member of the Elected Officers’ Class ceases to
763 fill an office covered by this class for 3 calendar months for
764 any reason other than retirement and has not been employed in
765 any capacity with any participating employer for 3 calendar
766 months, the member is entitled to receive a refund of all
767 contributions he or she made to the pension plan, subject to the
768 restrictions otherwise provided in this chapter. Partial refunds
769 are not permitted. The refund may not include any interest
770 earnings on contributions to the pension plan. Employer
771 contributions made on behalf of the member are not refundable. A
772 member may not receive a refund of employee contributions if a
773 pending or an approved qualified domestic relations order is
774 filed against the member’s retirement account. By obtaining a
775 refund of contributions, a member waives all rights under the
776 Florida Retirement System, including the health insurance
777 subsidy under this subsection, to the service credit represented
778 by the refunded contributions, except the right to purchase
779 prior service credit in accordance with s. 121.081(2).
780 (8) NORMAL RETIREMENT DATE; VESTING REQUIREMENT.—A member
781 of the Elected Officers’ Class has shall have the same normal
782 retirement date as defined in s. 121.021(29) for a member of the
783 regular class of the Florida Retirement System. A Any public
784 service commissioner who was removed from the Elected State
785 Officers’ Class on July 1, 1979, after attaining at least 8
786 years of creditable service in that class is shall be considered
787 to have reached the normal retirement date upon attaining the
788 required age as provided 62 as required in s. 121.021(29)(a).
789 Section 10. Paragraph (a) of subsection (7) of section
790 121.053, Florida Statutes, is amended to read:
791 121.053 Participation in the Elected Officers’ Class for
792 retired members.—
793 (7) A member who is elected or appointed to an elective
794 office and who is participating in the Deferred Retirement
795 Option Program is not subject to termination as defined in s.
796 121.021, or reemployment limitations as provided in s.
797 121.091(9), until the end of his or her current term of office
798 or, if the officer is consecutively elected or reelected to an
799 elective office eligible for coverage under the Florida
800 Retirement System, until he or she no longer holds an elective
801 office, as follows:
802 (a) At the end of the 60-month DROP period:
803 1. The officer’s DROP account may not accrue additional
804 monthly benefits, but does continue to earn interest as provided
805 in s. 121.091(13). However, an officer whose DROP participation
806 begins on or after July 1, 2010, may not continue to earn such
807 interest.
808 2. Retirement contributions are not required of the officer
809 or the employer of the elected officer and additional retirement
810 credit may not be earned under the Florida Retirement System.
811 Section 11. Paragraphs (b) and (j) of subsection (1),
812 paragraph (b) of subsection (3), and paragraphs (c), (d), and
813 (e) of subsection (6) of section 121.055, Florida Statutes, are
814 amended, present paragraph (c) of subsection (3) of that section
815 is redesignated as paragraph (d), and a new paragraph (c) is
816 added to that subsection, to read:
817 121.055 Senior Management Service Class.—There is hereby
818 established a separate class of membership within the Florida
819 Retirement System to be known as the “Senior Management Service
820 Class,” which shall become effective February 1, 1987.
821 (1)
822 (b)1. Except as provided in subparagraph 2., effective
823 January 1, 1990, participation in the Senior Management Service
824 Class is shall be compulsory for the president of each community
825 college, the manager of each participating city or county, and
826 all appointed district school superintendents. Effective January
827 1, 1994, additional positions may be designated for inclusion in
828 the Senior Management Service Class if of the Florida Retirement
829 System, provided that:
830 a. Positions to be included in the class are shall be
831 designated by the local agency employer. Notice of intent to
832 designate positions for inclusion in the class must shall be
833 published once a week for 2 consecutive weeks in a newspaper of
834 general circulation published in the county or counties
835 affected, as provided under in chapter 50.
836 b. Up to 10 nonelective full-time positions may be
837 designated for each local agency employer reporting to the
838 department of Management Services; for local agencies with 100
839 or more regularly established positions, additional nonelective
840 full-time positions may be designated, up to not to exceed 1
841 percent of the regularly established positions within the
842 agency.
843 c. Each position added to the class must be a managerial or
844 policymaking position filled by an employee who is not subject
845 to continuing contract and serves at the pleasure of the local
846 agency employer without civil service protection, and who:
847 (I) Heads an organizational unit; or
848 (II) Has responsibility to effect or recommend personnel,
849 budget, expenditure, or policy decisions in his or her areas of
850 responsibility.
851 2. In lieu of participation in the Senior Management
852 Service Class, members of the Senior Management Service class,
853 pursuant to the provisions of subparagraph 1., may withdraw from
854 the Florida Retirement System altogether. The decision to
855 withdraw from the Florida Retirement system is shall be
856 irrevocable for as long as the employee holds the such a
857 position. Any service creditable under the Senior Management
858 Service Class shall be retained after the member withdraws from
859 the Florida Retirement system; however, additional service
860 credit in the Senior Management Service Class may shall not be
861 earned after such withdrawal. Such members are shall not be
862 eligible to participate in the Senior Management Service
863 Optional Annuity Program.
864 3. Effective January 1, 2006, through June 30, 2006, an
865 employee who has withdrawn from the Florida Retirement System
866 under subparagraph 2. has one opportunity to elect to
867 participate in either the pension plan or investment plan
868 defined benefit program or the Public Employee Optional
869 Retirement Program of the Florida Retirement System.
870 a. If the employee elects to participate in the investment
871 plan Public Employee Optional Retirement Program, membership is
872 shall be prospective, and the applicable provisions of s.
873 121.4501(4) shall govern the election.
874 b. If the employee elects to participate in the pension
875 plan defined benefit program of the Florida Retirement System,
876 the employee shall, upon payment to the system trust fund of the
877 amount calculated under sub-sub-subparagraph (I), receive
878 service credit for prior service based upon the time during
879 which the employee had withdrawn from the system.
880 (I) The cost for such credit shall be an amount
881 representing the actuarial accrued liability for the affected
882 period of service. The cost shall be calculated using the
883 discount rate and other relevant actuarial assumptions that were
884 used to value pension the Florida Retirement System defined
885 benefit plan liabilities in the most recent actuarial valuation.
886 The calculation must shall include any service already
887 maintained under the pension defined benefit plan in addition to
888 the period of withdrawal. The actuarial accrued liability
889 attributable to any service already maintained under the pension
890 defined benefit plan shall be applied as a credit to the total
891 cost resulting from the calculation. The division must shall
892 ensure that the transfer sum is prepared using a formula and
893 methodology certified by an actuary.
894 (II) The employee must transfer a sum representing the net
895 cost owed for the actuarial accrued liability in sub-sub
896 subparagraph (I) immediately following the time of such
897 movement, determined assuming that attained service equals the
898 sum of service in the pension plan defined benefit program and
899 the period of withdrawal.
900 (j) Except as may otherwise be provided, a any member of
901 the Senior Management Service Class may purchase additional
902 retirement credit in such class for creditable service within
903 the purview of the Senior Management Service Class retroactive
904 to February 1, 1987, and may upgrade retirement credit for such
905 service, to the extent of 2 percent of the member’s average
906 monthly compensation as specified in paragraph (4)(d) for such
907 service. Contributions for upgrading the additional Senior
908 Management Service credit are pursuant to this paragraph shall
909 be equal to the difference in the employer and, if applicable,
910 employee contributions paid and the Senior Management Service
911 Class contribution rate as a percentage of gross salary in
912 effect for the period being claimed, plus interest thereon at
913 the rate of 6.5 percent a year, compounded annually until the
914 date of payment. The This service credit may be purchased by the
915 employer on behalf of the member.
916 (3)
917 (b) The employer or member of the Senior Management Service
918 Class, as applicable, paying the salary of a member of the
919 Senior Management Service Class shall contribute an amount as
920 specified in this section or s. 121.71, as appropriate, which
921 shall constitute the entire employer retirement contribution
922 with respect to such member. The employer shall also withhold
923 one-half of the entire contribution of the member required for
924 social security coverage. Effective July 1, 2011, each member
925 shall pay employee contributions as specified in s. 121.71.
926 (c) Three months after termination of employment from all
927 participating of employers for any reason other than retirement,
928 a member is entitled to a refund of all contributions he or she
929 made before or after participation in the noncontributory plan,
930 subject to the restrictions otherwise provided in this chapter.
931 Employer contributions made on behalf of the member are not
932 refundable. The refund may not include any interest earnings on
933 the contributions to the pension plan. A member may not receive
934 a refund of employee contributions if a pending or an approved
935 qualified domestic relations order is filed against the member’s
936 retirement account. By obtaining a refund of contributions, a
937 member waives all rights under the Florida Retirement System,
938 including the health insurance subsidy under paragraph (d), to
939 the service credit represented by the refunded contributions,
940 except the right to purchase his or her prior service credit in
941 accordance with s. 121.081(2).
942 (6)
943 (c) Participation.—
944 1. An eligible employee who is employed on or before
945 February 1, 1987, may elect to participate in the optional
946 annuity program in lieu of participating participation in the
947 Senior Management Service Class. Such election must be made in
948 writing and filed with the department and the personnel officer
949 of the employer on or before May 1, 1987. An eligible employee
950 who is employed on or before February 1, 1987, and who fails to
951 make an election to participate in the optional annuity program
952 by May 1, 1987, shall be deemed to have elected membership in
953 the Senior Management Service Class.
954 2. Except as provided in subparagraph 6., an employee who
955 becomes eligible to participate in the optional annuity program
956 by reason of initial employment commencing after February 1,
957 1987, may, within 90 days after the date of commencing
958 employment, elect to participate in the optional annuity
959 program. Such election must be made in writing and filed with
960 the personnel officer of the employer. An eligible employee who
961 does not within 90 days after commencing employment elect to
962 participate in the optional annuity program shall be deemed to
963 have elected membership in the Senior Management Service Class.
964 3. A person who is appointed to a position in the Senior
965 Management Service Class and who is a member of an existing
966 retirement system or the Special Risk or Special Risk
967 Administrative Support Classes of the Florida Retirement System
968 may elect to remain in such system or class in lieu of
969 participating participation in the Senior Management Service
970 Class or optional annuity program. Such election must be made in
971 writing and filed with the department and the personnel officer
972 of the employer within 90 days after of such appointment. An Any
973 eligible employee who fails to make an election to participate
974 in the existing system, the Special Risk Class of the Florida
975 Retirement System, the Special Risk Administrative Support Class
976 of the Florida Retirement System, or the optional annuity
977 program shall be deemed to have elected membership in the Senior
978 Management Service Class.
979 4. Except as provided in subparagraph 5., an employee’s
980 election to participate in the optional annuity program is
981 irrevocable if the employee continues to be employed in an
982 eligible position and continues to meet the eligibility
983 requirements set forth in this paragraph.
984 5. Effective from July 1, 2002, through September 30, 2002,
985 an any active employee in a regularly established position who
986 has elected to participate in the Senior Management Service
987 Optional Annuity Program has one opportunity to choose to move
988 from the Senior Management Service Optional Annuity Program to
989 the Florida Retirement System’s pension plan System defined
990 benefit program.
991 a. The election must be made in writing and must be filed
992 with the department and the personnel officer of the employer
993 before October 1, 2002, or, in the case of an active employee
994 who is on a leave of absence on July 1, 2002, within 90 days
995 after the conclusion of the leave of absence. This election is
996 irrevocable.
997 b. The employee shall receive service credit under the
998 pension plan defined benefit program of the Florida Retirement
999 System equal to his or her years of service under the Senior
1000 Management Service Optional Annuity Program. The cost for such
1001 credit is the amount representing the present value of that
1002 employee’s accumulated benefit obligation for the affected
1003 period of service.
1004 c. The employee must transfer the total accumulated
1005 employer contributions and earnings on deposit in his or her
1006 Senior Management Service Optional Annuity Program account. If
1007 the transferred amount is not sufficient to pay the amount due,
1008 the employee must pay a sum representing the remainder of the
1009 amount due. The employee may not retain any employer
1010 contributions or earnings thereon from the Senior Management
1011 Service Optional Annuity Program account.
1012 6. A retiree of a state-administered retirement system who
1013 is initially reemployed on or after July 1, 2010, may not renew
1014 membership in the Senior Management Service Optional Annuity
1015 Program.
1016 (d) Contributions.—
1017 1.a. Through June 30, 2001, each employer shall contribute
1018 on behalf of each member of participant in the Senior Management
1019 Service Optional Annuity Program an amount equal to the normal
1020 cost portion of the employer retirement contribution which would
1021 be required if the employee participant were a Senior Management
1022 Service Class member of the Florida Retirement System’s pension
1023 plan System defined benefit program, plus the portion of the
1024 contribution rate required in s. 112.363(8) which that would
1025 otherwise be assigned to the Retiree Health Insurance Subsidy
1026 Trust Fund.
1027 b. Effective July 1, 2001, each employer shall contribute
1028 on behalf of each member of participant in the optional annuity
1029 program an amount equal to 12.49 percent of the employee’s
1030 participant’s gross monthly compensation.
1031 c. Effective July 1, 2011, each member of the optional
1032 annuity program shall contribute an amount equal to the employee
1033 contribution required in s. 121.71(3). The employer shall
1034 contribute on behalf of each such employee an amount equal to
1035 the difference between 12.49 percent of the employee’s gross
1036 monthly compensation and the amount equal to the employee’s
1037 required contribution based on the employee’s gross monthly
1038 compensation.
1039 d. The department shall deduct an amount approved by the
1040 Legislature to provide for the administration of this program.
1041 The Payment of the contributions, including contributions made
1042 by the employee, to the optional program which is required by
1043 this subparagraph for each participant shall be made by the
1044 employer to the department, which shall forward the
1045 contributions to the designated company or companies contracting
1046 for payment of benefits for members of the participant under the
1047 optional annuity program. The department shall deduct an amount
1048 approved by the Legislature to provide for the administration of
1049 the program.
1050 2. Each employer shall contribute on behalf of each member
1051 of participant in the Senior Management Service Optional Annuity
1052 Program an amount equal to the unfunded actuarial accrued
1053 liability portion of the employer contribution which would be
1054 required for members of the Senior Management Service Class in
1055 the Florida Retirement System. This contribution shall be paid
1056 to the department for transfer to the Florida Retirement System
1057 Trust Fund.
1058 3. An Optional Annuity Program Trust Fund shall be
1059 established in the State Treasury and administered by the
1060 department to make payments to provider companies on behalf of
1061 the optional annuity program members participants, and to
1062 transfer the unfunded liability portion of the state optional
1063 annuity program contributions to the Florida Retirement System
1064 Trust Fund.
1065 4. Contributions required for social security by each
1066 employer and each employee participant, in the amount required
1067 for social security coverage as now or hereafter may be provided
1068 by the federal Social Security Act, shall be maintained for each
1069 member of participant in the Senior Management Service
1070 retirement program and are shall be in addition to the
1071 retirement contributions specified in this paragraph.
1072 5. Each member of participant in the Senior Management
1073 Service optional annuity program may contribute by way of salary
1074 reduction or deduction a percentage amount of the employee’s
1075 participant’s gross compensation not to exceed the percentage
1076 amount contributed by the employer to the optional annuity
1077 program. Payment of the employee’s participant’s contributions
1078 shall be made by the employer to the department, which shall
1079 forward the contributions to the designated company or companies
1080 contracting for payment of benefits for member’s the participant
1081 under the program.
1082 (e) Benefits.—
1083 1. Benefits under the Senior Management Service Optional
1084 Annuity Program are payable only to members of participants in
1085 the program, or their beneficiaries as designated by the member
1086 participant in the contract with the provider company, and must
1087 be paid by the designated company in accordance with the terms
1088 of the annuity contract applicable to the member participant. A
1089 member participant must be terminated from all employment
1090 relationships with Florida Retirement System employers as
1091 provided in s. 121.021(39) to begin receiving the employer
1092 funded benefit. Benefits funded by employer contributions are
1093 payable under the terms of the contract to the member
1094 participant, his or her beneficiary, or his or her estate, in
1095 addition to:
1096 a. A lump-sum payment to the beneficiary upon the death of
1097 the member participant;
1098 b. A cash-out of a de minimis account upon the request of a
1099 former member participant who has been terminated for a minimum
1100 of 6 calendar months from the employment that entitled him or
1101 her to optional annuity program participation. Such cash-out
1102 must be a complete liquidation of the account balance with that
1103 company and is subject to the Internal Revenue Code;
1104 c. A mandatory distribution of a de minimis account of a
1105 former member participant who has been terminated for a minimum
1106 of 6 calendar months from the employment that entitled him or
1107 her to optional annuity program participation as authorized by
1108 the department; or
1109 d. A lump-sum direct rollover distribution whereby all
1110 accrued benefits, plus interest and investment earnings, are
1111 paid from the member’s participant’s account directly to the
1112 custodian of an eligible retirement plan, as defined in s.
1113 402(c)(8)(B) of the Internal Revenue Code, on behalf of the
1114 member participant.
1115 2. The benefits payable to any person under the Senior
1116 Management Service optional annuity program, and any
1117 contribution accumulated under such program, are not subject to
1118 assignment, execution, or attachment or to any legal process
1119 whatsoever.
1120 3. Except as provided in subparagraph 4., a member
1121 participant who terminates employment and receives a
1122 distribution, including a rollover or trustee-to-trustee
1123 transfer, funded by employer or employee contributions is shall
1124 be deemed to be retired from a state-administered retirement
1125 system if the retiree participant is subsequently employed with
1126 an employer that participates in the Florida Retirement System.
1127 4. A member participant who receives optional annuity
1128 program benefits funded by employer or employee contributions as
1129 a mandatory distribution of a de minimis account authorized by
1130 the department is not considered a retiree.
1131
1132 As used in this paragraph, a “de minimis account” means an
1133 account with a provider company containing employer or employee
1134 contributions and accumulated earnings of not more than $5,000
1135 made under this chapter.
1136 Section 12. Subsections (2) and (5) and paragraph (c) of
1137 subsection (6) of section 121.071, Florida Statutes, are
1138 amended, present paragraph (d) of subsection (6) of that section
1139 is redesignated as paragraph (e), and a new paragraph (d) is
1140 added to that subsection, to read:
1141 121.071 Contributions.—Contributions to the system shall be
1142 made as follows:
1143 (2)(a) Effective January 1, 1975, or October 1, 1975, as
1144 applicable, and through June 30, 2011, each employer shall make
1145 accomplish the contribution required by subsection (1) by a
1146 procedure in which no employee’s gross salary is shall be
1147 reduced. Effective July 1, 2011, each employee, and his or her
1148 employer, shall pay retirement contributions as specified in s.
1149 121.71.
1150 (b) Three calendar months after Upon termination of
1151 employment from all participating employers for any reason other
1152 than retirement, a member is shall be entitled to a full refund
1153 of the contributions he or she has made before or after prior or
1154 subsequent to participation in the noncontributory plan, subject
1155 to the restrictions otherwise provided in this chapter. Partial
1156 refunds are not permitted. Employer contributions made on behalf
1157 of the member are not refundable. The refund may not include
1158 interest earnings on contributions for a member of the pension
1159 plan. A member may not receive a refund of employee
1160 contributions if a pending or approved qualified domestic
1161 relations order is filed against his or her retirement account.
1162 By obtaining a refund of contributions, a member waives all
1163 rights under the Florida Retirement System and the health
1164 insurance subsidy to the service credit represented by the
1165 refunded contributions, except the right to purchase his or her
1166 prior service credit in accordance with s. 121.081(2).
1167 (5) Contributions made in accordance with subsections (1),
1168 (2), (3), and (4), and s. 121.71 shall be paid by the employer
1169 into the system trust funds in accordance with rules adopted by
1170 the administrator pursuant to chapter 120, except as may be
1171 otherwise specified herein. Effective July 1, 2002,
1172 contributions paid under subsections (1) and (4) and
1173 accompanying payroll data are due and payable by no later than
1174 the 5th working day of the month immediately following the month
1175 during which the payroll period ended.
1176 (6)
1177 (c) By obtaining a refund of contributions, a member waives
1178 all rights under the Florida Retirement System, including the
1179 health insurance subsidy under subsection (4), to the service
1180 credit represented by the refunded contributions, except the
1181 right to purchase his or her prior service credit in accordance
1182 with s. 121.081(2).
1183 (d) If a member or former member of the pension plan
1184 receives an invalid refund from the Florida Retirement System
1185 Trust Fund, such person must repay the full amount of the
1186 refund, plus interest at 6.5 percent compounded annually on each
1187 June 30 from the date of refund until full repayment is made.
1188 The invalid refund must be repaid before the member retires or,
1189 if applicable, transfers to the investment plan.
1190 Section 13. Paragraphs (b) and (c) of subsection (1) and
1191 subsection (2) of section 121.081, Florida Statutes, are amended
1192 to read:
1193 121.081 Past service; prior service; contributions.
1194 Conditions under which past service or prior service may be
1195 claimed and credited are:
1196 (1)
1197 (b) Past service earned after January 1, 1975, may be
1198 claimed by officers or employees of a municipality, metropolitan
1199 planning organization, charter school, charter technical career
1200 center, or special district who become a covered group under
1201 this system. The governing body of a covered group may elect to
1202 provide benefits for past service earned after January 1, 1975,
1203 in accordance with this chapter., and The cost for such past
1204 service is established by applying the following formula: The
1205 employer shall contribute an amount equal to the employer or
1206 employee contribution rate in effect at the time the service was
1207 earned, as applicable, multiplied by the employee’s gross salary
1208 for each year of past service claimed, plus 6.5 percent 6.5
1209 percent interest thereon, compounded annually, for figured on
1210 each year of past service, with interest compounded from date of
1211 annual salary earned until date of payment.
1212 (c) If an Should the employer joined the Florida Retirement
1213 System before July 1, 2011, and does not elect to provide past
1214 service for the member on the date of joining the system, then
1215 the member may claim and pay for the service as provided in
1216 same, based on paragraphs (a) and (b).
1217 (2) Prior service, as defined in s. 121.021(19), may be
1218 claimed as creditable service under the Florida Retirement
1219 System after a member has been reemployed for 1 complete year of
1220 creditable service within a period of 12 consecutive months,
1221 except as provided in paragraph (c). Service performed as a
1222 member participant of the optional retirement program for the
1223 State University System under s. 121.35 or the Senior Management
1224 Service Optional Annuity Program under s. 121.055 may be used to
1225 satisfy the reemployment requirement of 1 complete year of
1226 creditable service. The member may shall not be permitted to
1227 make any contributions for prior service until after completion
1228 of the 1 year of creditable service. If a member does not wish
1229 to claim credit for all of his or her prior service, the service
1230 the member claims must be the most recent period of service. The
1231 required contributions for claiming the various types of prior
1232 service are:
1233 (a) For prior service performed before prior to the date
1234 the system becomes noncontributory for the member and for which
1235 the member had credit under one of the existing retirement
1236 systems and received a refund of contributions upon termination
1237 of employment, the member shall contribute 4 percent of all
1238 salary received during the period being claimed, plus 4 percent
1239 4-percent interest compounded annually from date of refund until
1240 July 1, 1975, and 6.5 percent 6.5-percent interest compounded
1241 annually thereafter, until full payment is made to the Florida
1242 Retirement System Trust Fund, and shall receive credit in the
1243 Regular Class. A member who elected to transfer to the Florida
1244 Retirement System from an existing system may receive credit for
1245 prior service under the existing system if he or she was
1246 eligible under the existing system to claim the prior service at
1247 the time of the transfer. Contributions for such prior service
1248 shall be determined by the applicable provisions of the system
1249 under which the prior service is claimed and shall be paid by
1250 the member, with matching contributions paid by the employer at
1251 the time the service was performed. Effective July 1, 1978, the
1252 account of a person who terminated under s. 238.05(3) may not be
1253 charged interest for contributions that remained on deposit in
1254 the Annuity Savings Trust Fund established under chapter 238,
1255 upon retirement under this chapter or chapter 238.
1256 (b) For prior service performed before prior to the date
1257 the system becomes noncontributory for the member and for which
1258 the member had credit under the Florida Retirement System and
1259 received a refund of contributions upon termination of
1260 employment, the member shall contribute at the rate that was
1261 required of him or her during the period of service being
1262 claimed, on all salary received during such period, plus 4
1263 percent 4-percent interest compounded annually from date of
1264 refund until July 1, 1975, and 6.5 percent 6.5-percent interest
1265 compounded annually thereafter, until the full payment is made
1266 to the Florida Retirement System Trust Fund, and shall receive
1267 credit in the membership class in which the member participated
1268 during the period claimed.
1269 (c) For prior service as defined in s. 121.021(19)(b) and
1270 (c) during which no contributions were made because the member
1271 did not participate in a retirement system, the member shall
1272 contribute 14.38 percent of all salary received during such
1273 period or 14.38 percent of $100 per month during such period,
1274 whichever is greater, plus 4 percent 4-percent interest
1275 compounded annually from the first year of service claimed until
1276 July 1, 1975, and 6.5 percent 6.5-percent interest compounded
1277 annually thereafter, until full payment is made to the
1278 Retirement Trust Fund, and shall receive credit in the Regular
1279 Class.
1280 (d) In order to claim credit for prior service as defined
1281 in s. 121.021(19)(d) for which no retirement contributions were
1282 paid during the period of such service, the member shall
1283 contribute the total employee and employer contributions which
1284 were required to be made to the Highway Patrol Pension Trust
1285 Fund, as provided in chapter 321, during the period claimed,
1286 plus 4 percent 4-percent interest compounded annually from the
1287 first year of service until July 1, 1975, and 6.5 percent 6.5
1288 percent interest compounded annually thereafter, until full
1289 payment is made to the Retirement Trust Fund. However, any
1290 governmental entity that which employed such member may elect to
1291 pay up to 50 percent of the contributions and interest required
1292 to purchase the this prior service credit. The service shall be
1293 credited in accordance with the provisions of the Highway Patrol
1294 Pension Plan in effect during the period claimed unless the
1295 member terminated and withdrew his or her retirement
1296 contributions and was thereafter enrolled in the State and
1297 County Officers and Employees’ Retirement System or the Florida
1298 Retirement System, in which case the service shall be credited
1299 as Regular Class service.
1300 (e) For service performed under the Florida Retirement
1301 System after December 1, 1970, which that was never reported to
1302 the division or the department due to error, retirement credit
1303 may be claimed by a member of the Florida Retirement System. The
1304 department shall adopt rules establishing criteria for claiming
1305 such credit and detailing the documentation required to
1306 substantiate the error.
1307 (f) For prior service performed on or after July 1, 2011,
1308 for which the member had credit under the Florida Retirement
1309 System and received a refund of contributions 3 months after
1310 termination of employment, the member shall contribute at the
1311 rate that was required during the period of service being
1312 claimed, plus 6.5 percent interest, compounded annually on each
1313 June 30 from date of refund until the full payment is made to
1314 the Florida Retirement System Trust Fund, and shall receive
1315 credit in the membership class in which the member participated
1316 during the period claimed.
1317 (g)(f) The employer may not be required to make
1318 contributions for prior service credit for any member, except
1319 that the employer shall pay the employer portion of
1320 contributions for any legislator who elects to withdraw from the
1321 Florida Retirement System and later rejoins the system and pays
1322 any employee contributions required in accordance with s.
1323 121.052(3)(d).
1324 Section 14. Paragraph (a) of subsection (3), paragraph (a)
1325 of subsection (4), paragraphs (a) and (c) of subsection (5),
1326 paragraph (d) of subsection (9), and paragraph (d) of subsection
1327 (14) of section 121.091, Florida Statutes, are amended, present
1328 paragraphs (e) through (k) of subsection (5) of that section are
1329 renumbered as paragraphs (f) through (l), respectively, and a
1330 new paragraph (d) is added to that subsection, to read:
1331 121.091 Benefits payable under the system.—Benefits may not
1332 be paid under this section unless the member has terminated
1333 employment as provided in s. 121.021(39)(a) or begun
1334 participation in the Deferred Retirement Option Program as
1335 provided in subsection (13), and a proper application has been
1336 filed in the manner prescribed by the department. The department
1337 may cancel an application for retirement benefits when the
1338 member or beneficiary fails to timely provide the information
1339 and documents required by this chapter and the department’s
1340 rules. The department shall adopt rules establishing procedures
1341 for application for retirement benefits and for the cancellation
1342 of such application when the required information or documents
1343 are not received.
1344 (3) EARLY RETIREMENT BENEFIT.—Upon retirement on his or her
1345 early retirement date, the member shall receive an immediate
1346 monthly benefit that shall begin to accrue on the first day of
1347 the month of the retirement date and be payable on the last day
1348 of that month and each month thereafter during his or her
1349 lifetime. Such benefit shall be calculated as follows:
1350 (a) The amount of each monthly payment shall be computed in
1351 the same manner as for a normal retirement benefit, in
1352 accordance with subsection (1), but shall be based on the
1353 member’s average monthly compensation and creditable service as
1354 of the member’s early retirement date. The benefit so computed
1355 shall be reduced by five-twelfths of 1 percent for each complete
1356 month by which the early retirement date precedes the normal
1357 retirement date of age 62 for a member of the Regular Class,
1358 Senior Management Service Class, or the Elected Officers’ Class,
1359 and age 55 for a member of the Special Risk Class, or age 52 if
1360 a Special Risk member has completed 25 years of creditable
1361 service in accordance with s. 121.021(29)(b)3.
1362 (4) DISABILITY RETIREMENT BENEFIT.—
1363 (a) Disability retirement; entitlement and effective date.—
1364 1.a. A member who becomes totally and permanently disabled,
1365 as defined in paragraph (b), after completing 5 years of
1366 creditable service, or a member who becomes totally and
1367 permanently disabled in the line of duty regardless of service,
1368 is shall be entitled to a monthly disability benefit; except
1369 that any member with less than 5 years of creditable service on
1370 July 1, 1980, or any person who becomes a member of the Florida
1371 Retirement System on or after such date must have completed 10
1372 years of creditable service before prior to becoming totally and
1373 permanently disabled in order to receive disability retirement
1374 benefits for any disability which occurs other than in the line
1375 of duty. However, if a member employed on July 1, 1980, that has
1376 with less than 5 years of creditable service as of that date,
1377 becomes totally and permanently disabled after completing 5
1378 years of creditable service and is found not to have attained
1379 fully insured status for benefits under the federal Social
1380 Security Act, such member is shall be entitled to a monthly
1381 disability benefit.
1382 b. Effective July 1, 2001, a member of the pension plan
1383 defined benefit retirement program who becomes totally and
1384 permanently disabled, as defined in paragraph (b), after
1385 completing 8 years of creditable service, or a member who
1386 becomes totally and permanently disabled in the line of duty
1387 regardless of service, is shall be entitled to a monthly
1388 disability benefit.
1389 2. If the division has received from the employer the
1390 required documentation of the member’s termination of
1391 employment, the effective retirement date for a member who
1392 applies and is approved for disability retirement shall be
1393 established by rule of the division.
1394 3. For a member who is receiving Workers’ Compensation
1395 payments, the effective disability retirement date may not
1396 precede the date the member reaches Maximum Medical Improvement
1397 (MMI), unless the member terminates employment before prior to
1398 reaching MMI.
1399 (5) TERMINATION BENEFITS.—A member whose employment is
1400 terminated before prior to retirement retains membership rights
1401 to previously earned member-noncontributory service credit, and
1402 to member-contributory service credit, if the member leaves the
1403 member contributions on deposit in his or her retirement
1404 account. If a terminated member receives a refund of member
1405 contributions, such member may reinstate membership rights to
1406 the previously earned service credit represented by the refund
1407 by completing 1 year of creditable service and repaying the
1408 refunded member contributions, plus interest.
1409 (a) A member whose employment is terminated for any reason
1410 other than death or retirement before prior to becoming vested
1411 is entitled to the return of his or her accumulated employee
1412 contributions as of the date of termination.
1413 (c) In lieu of the deferred monthly benefit provided in
1414 paragraph (b), the terminated member may elect to receive a
1415 lump-sum amount equal to his or her accumulated employee
1416 contributions as of the date of termination.
1417 (d) Upon termination of employment from all participating
1418 employers for 3 calendar months for any reason other than
1419 retirement pursuant to s. 121.021(39)(c), a member may receive a
1420 refund of all contributions he or she has made to the pension
1421 plan, subject to restrictions otherwise provided in this
1422 chapter. Partial refunds are not permitted. The refund may not
1423 include any interest earnings on the contributions for a member
1424 of the pension plan. Employer contributions made on behalf of
1425 the member are not refundable. A member may not receive a refund
1426 of employee contributions if a pending or an approved qualified
1427 domestic relations order is filed against his or her retirement
1428 account. By obtaining a refund of contributions, a member waives
1429 all rights under the Florida Retirement System and the health
1430 insurance subsidy to the service credit represented by the
1431 refunded contributions, except the right to purchase his or her
1432 prior service credit in accordance with s. 121.081(2).
1433 (9) EMPLOYMENT AFTER RETIREMENT; LIMITATION.—
1434 (d) The provisions of This subsection applies apply to
1435 retirees, as defined in s. 121.4501(2), of the Florida Public
1436 Employee Optional Retirement System Investment Plan Program,
1437 subject to the following conditions:
1438 1. The retiree retirees may not be reemployed with an
1439 employer participating in the Florida Retirement System until
1440 such person has been retired for 6 calendar months.
1441 2. A retiree employed in violation of this subsection and
1442 an employer that employs or appoints such person are jointly and
1443 severally liable for reimbursement of any benefits paid to the
1444 retirement trust fund from which the benefits were paid,
1445 including the Retirement System Trust Fund and the Public
1446 Employee Optional Retirement Program Trust Fund, as appropriate.
1447 The employer must have a written statement from the retiree that
1448 he or she is not retired from a state-administered retirement
1449 system.
1450 (14) PAYMENT OF BENEFITS.—This subsection applies to the
1451 payment of benefits to a payee (retiree or beneficiary) under
1452 the Florida Retirement System:
1453 (d) A payee whose retirement benefits are reduced by the
1454 application of maximum benefit limits under s. 415(b) of the
1455 Internal Revenue Code, as specified in s. 121.30(5), shall have
1456 the portion of his or her calculated benefit in the Florida
1457 Retirement System’s pension System defined benefit plan which
1458 exceeds such federal limitation paid through the Florida
1459 Retirement System Preservation of Benefits Plan, as provided in
1460 s. 121.1001.
1461 Section 15. Subsection (1) and paragraph (a) of subsection
1462 (2) of section 121.1001, Florida Statutes, is amended to read:
1463 121.1001 Florida Retirement System Preservation of Benefits
1464 Plan.—Effective July 1, 1999, the Florida Retirement System
1465 Preservation of Benefits Plan is established as a qualified
1466 governmental excess benefit arrangement pursuant to s. 415(m) of
1467 the Internal Revenue Code. The Preservation of Benefits Plan is
1468 created as a separate portion of the Florida Retirement System,
1469 for the purpose of providing benefits to a payee (retiree or
1470 beneficiary) of the Florida Retirement System whose benefits
1471 would otherwise be limited by s. 415(b) of the Internal Revenue
1472 Code.
1473 (1) ELIGIBILITY TO PARTICIPATE IN THE PRESERVATION OF
1474 BENEFITS PLAN.—A payee of the Florida Retirement System shall
1475 participate in the Preservation of Benefits Plan if whenever his
1476 or her earned benefit under the Florida Retirement System’s
1477 pension System defined benefit plan exceeds the benefit maximum
1478 established under s. 415(b) of the Internal Revenue Code.
1479 Participation in the Preservation of Benefits Plan shall
1480 continue for as long as the payee’s earned benefit under the
1481 pension Florida Retirement System defined benefit plan is
1482 reduced by the application of the maximum benefit limit under s.
1483 415(b) of the Internal Revenue Code.
1484 (2) BENEFITS PAYABLE UNDER THE PRESERVATION OF BENEFITS
1485 PLAN.—
1486 (a) On and after July 1, 1999, the Division of Retirement
1487 shall pay to each eligible payee of the Florida Retirement
1488 System who retires before, on, or after that such date, a
1489 supplemental retirement benefit equal to the difference between
1490 the amount of the payee’s monthly retirement benefit which would
1491 have been payable under the Florida Retirement System’s pension
1492 System defined benefit plan if not for a reduction due to the
1493 application of s. 415(b) of the Internal Revenue Code and the
1494 reduced monthly retirement benefit as paid to the payee. The
1495 Preservation of Benefits Plan benefit shall be computed and
1496 payable under the same terms and conditions and to the same
1497 person as would have applied under the pension Florida
1498 Retirement System defined benefit plan were it not for the
1499 federal limitation.
1500 Section 16. Subsection (1) of section 121.121, Florida
1501 Statutes, is amended to read:
1502 121.121 Authorized leaves of absence.—
1503 (1) A member may purchase creditable service for up to 2
1504 work years of authorized leaves of absence, including any leaves
1505 of absence covered under the Family Medical Leave Act, if:
1506 (a) The member has completed a minimum of 6 years of
1507 creditable service, excluding periods for which a leave of
1508 absence was authorized;
1509 (b) The leave of absence is authorized in writing by the
1510 employer of the member and approved by the administrator;
1511 (c) The member returns to active employment performing
1512 service with a Florida Retirement System employer in a regularly
1513 established position immediately upon termination of the leave
1514 of absence and remains on the employer’s payroll for 1 calendar
1515 month, except that a member who retires on disability while on a
1516 medical leave of absence may shall not be required to return to
1517 employment. A member whose work year is less than 12 months and
1518 whose leave of absence terminates between school years is
1519 eligible to receive credit for the leave of absence if as long
1520 as he or she returns to the employment of his or her employer at
1521 the beginning of the next school year and remains on the
1522 employer’s payroll for 1 calendar month; and
1523 (d) The member makes the required contributions for service
1524 credit during the leave of absence, which shall be 8 percent
1525 until January 1, 1975, and 9 percent thereafter of his or her
1526 rate of monthly compensation in effect immediately before prior
1527 to the commencement of such leave for each month of such period,
1528 plus 4 percent interest until July 1, 1975, and 6.5 percent
1529 interest thereafter on such contributions, compounded annually
1530 each June 30 from the due date of the contribution to date of
1531 payment. Effective July 1, 1980, any leave of absence purchased
1532 pursuant to this section is shall be at the contribution rates
1533 specified in s. 121.071 or s. 121.71 in effect at the time the
1534 leave is granted for the class of membership from which the
1535 leave of absence was granted; however, any member who purchased
1536 leave-of-absence credit before prior to July 1, 1980, for a
1537 leave of absence from a position in a class other than the
1538 regular membership class, may pay the appropriate additional
1539 contributions plus compound interest thereon and receive
1540 creditable service for such leave of absence in the membership
1541 class from which the member was granted the leave of absence.
1542 Effective July 1, 2011, any leave of absence purchased pursuant
1543 to this section shall be at the employee and employer
1544 contribution rates specified in s. 121.71 in effect during the
1545 leave for the class of membership from which the leave of
1546 absence was granted.
1547 Section 17. Subsection (2) of section 121.122, Florida
1548 Statutes, is amended, and subsection (3) is added to that
1549 section, to read:
1550 121.122 Renewed membership in system.—
1551 (2) A retiree of a state-administered retirement system who
1552 is initially reemployed on or after July 1, 2010, through June
1553 30, 2011, shall become a member of the Regular Class and be
1554 enrolled in the Florida Retirement System Investment Plan on
1555 July 1, 2011, and must resatisfy the vesting requirements and
1556 other provisions provided in this chapter is not eligible for
1557 renewed membership.
1558 (a) Creditable service, including credit towards the
1559 retiree health insurance subsidy provided in s. 112.363, does
1560 not accrue for a retiree’s employment in a regularly established
1561 position with a covered employer during the period from July 1,
1562 2010, through June 30, 2011.
1563 (b) Employer contributions, interest, earnings, or any
1564 other funds may not be paid into a renewed member’s investment
1565 plan account for any employment in a regularly established
1566 position with a covered employer during the period from July 1,
1567 2010, through June 30, 2011.
1568 (c) To be eligible to receive a retirement benefit under
1569 the investment plan, the renewed member must meet the vesting
1570 requirements of the plan as provided in s. 121.4501(6).
1571 (d) The member is not entitled to disability benefits as
1572 provided in s. 121.091(4) or s. 121.591(2).
1573 (e) The member must meet the reemployment after retirement
1574 limitations as provided in s. 121.091(9), as applicable.
1575 (f) Upon the renewed membership or reemployment of a
1576 retiree, the employer of such member and the retiree shall pay
1577 the applicable employer and employee contributions as required
1578 by ss. 112.363, 121.71, 121.74, and 121.76. Such contributions
1579 are payable only for employment in a regularly established
1580 position with a covered employer on or after July 1, 2011.
1581 (g) The member may not purchase any prior or past service
1582 in the investment plan, including employment in a regularly
1583 established position with a covered employer during the period
1584 from July 1, 2010, through June 30, 2011.
1585 (h) A renewed member who is not receiving the maximum
1586 health insurance subsidy provided in s. 112.363 is entitled to
1587 earn additional credit toward the subsidy. Such credit may be
1588 earned only for employment in a regularly established position
1589 with a covered employer on or after July 1, 2011. Any additional
1590 subsidy due because of additional credit may be received only at
1591 the time of paying the second career retirement benefit. The
1592 total health insurance subsidy received by a retiree receiving
1593 benefits from initial and renewed membership may not exceed the
1594 maximum allowed under s. 112.363.
1595 (3) Any retiree of a state-administered retirement system
1596 who is initially reemployed on or after July 1, 2011, in a
1597 regularly established position with a covered employer,
1598 including an elective public office that does not qualify for
1599 the Elected Officers’ Class, shall become a member of the
1600 Regular Class and be enrolled in the Florida Retirement System
1601 Investment Plan, and must resatisfy the vesting requirements and
1602 other provisions provided in this chapter.
1603 (a) To be eligible to receive a retirement benefit under
1604 the investment plan, the renewed member must meet the vesting
1605 requirements of the investment plan as provided in s.
1606 121.4501(6).
1607 (b) The member is not entitled to disability benefits as
1608 provided in s. 121.091(4) or s. 121.591(2).
1609 (c) The member must meet the reemployment after retirement
1610 limitations provided in s. 121.091(9), as applicable.
1611 (d) Upon renewed membership or reemployment of a retiree,
1612 the employer of such member and the retiree must pay the
1613 applicable employer and employee contributions as required by
1614 ss. 112.363, 121.71, 121.74, and 121.76.
1615 (e) The member may not purchase any prior or past service
1616 in the investment plan.
1617 (f) A renewed member who is not receiving the maximum
1618 health insurance subsidy provided in s. 112.363 is entitled to
1619 earn additional credit toward the subsidy. Any additional
1620 subsidy due because of additional credit may be received only at
1621 the time of paying the second career retirement benefit. The
1622 total health insurance subsidy received by a retiree receiving
1623 benefits from initial and renewed membership may not exceed the
1624 maximum allowed under s. 112.363.
1625 Section 18. Section 121.125, Florida Statutes, is amended
1626 to read:
1627 121.125 Credit for workers’ compensation payment periods.—A
1628 member of the retirement system created by this chapter who has
1629 been eligible or becomes eligible for to receive workers’
1630 compensation payments for an injury or illness that occurred
1631 occurring during his or her employment while a member of a any
1632 state retirement system shall, upon return to active employment
1633 with a covered employer for 1 calendar month or upon approval
1634 for disability retirement in accordance with s. 121.091(4),
1635 receive full retirement credit for the period before prior to
1636 such return to active employment or disability retirement for
1637 which the workers’ compensation payments were received. However,
1638 a no member may not receive retirement credit for any such
1639 period occurring after the earlier of the date of maximum
1640 medical improvement as defined in s. 440.02 or the date
1641 termination has occurred as defined in s. 121.021(39). The
1642 employer of record at the time of the worker’s compensation
1643 injury or illness shall make the required employee and employer
1644 retirement contributions based on the member’s rate of monthly
1645 compensation immediately before prior to his or her receiving
1646 workers’ compensation payments for retirement credit received by
1647 the member.
1648 Section 19. Paragraphs (g) and (i) of subsection (3) and
1649 subsection (4) of section 121.35, Florida Statutes, are amended
1650 to read:
1651 121.35 Optional retirement program for the State University
1652 System.—
1653 (3) ELECTION OF OPTIONAL PROGRAM.—
1654 (g) An eligible employee who is a member of the Florida
1655 Retirement System at the time of electing election to
1656 participate in the optional retirement program shall retain all
1657 retirement service credit earned under the Florida Retirement
1658 System, at the rate earned. No Additional service credit in the
1659 Florida Retirement system may not shall be earned while the
1660 employee participates in the optional program, and nor shall the
1661 employee is not be eligible for disability retirement under the
1662 Florida Retirement system. An eligible employee may transfer
1663 from the Florida Retirement System to his or her accounts under
1664 the State University System Optional Retirement Program a sum
1665 representing the present value of the employee’s accumulated
1666 benefit obligation under the defined benefit program of the
1667 Florida Retirement System’s pension plan System for any service
1668 credit accrued from the employee’s first eligible transfer date
1669 to the optional retirement program through the actual date of
1670 such transfer, if such service credit was earned in the period
1671 from July 1, 1984, through December 31, 1992. The present value
1672 of the employee’s accumulated benefit obligation shall be
1673 calculated as described in s. 121.4501(3) s. 121.4501(3)(c)2.
1674 Upon such transfer, all such service credit previously earned
1675 under the pension plan defined benefit program of the Florida
1676 Retirement System during this period is shall be nullified for
1677 purposes of entitlement to a future benefit under the pension
1678 plan defined benefit program of the Florida Retirement System.
1679 (i) Effective January 1, 2008, through December 31, 2008,
1680 except for an employee who is a mandatory member participant of
1681 the State University System Optional Retirement Program, an
1682 employee who has elected to participate in the State University
1683 System Optional Retirement Program shall have one opportunity,
1684 at the employee’s discretion, to choose to transfer from this
1685 program to the pension plan or the investment plan defined
1686 benefit program of the Florida Retirement System or to the
1687 Public Employee Optional Retirement Program, subject to the
1688 terms of the applicable contracts of the State University System
1689 Optional Retirement Program.
1690 1. If the employee chooses to move to the investment plan
1691 Public Employee Optional Retirement program, any contributions,
1692 interest, and earnings creditable to the employee under the
1693 State University System Optional Retirement Program must shall
1694 be retained by the employee in the State University System
1695 Optional Retirement Program, and the applicable provisions of s.
1696 121.4501(4) shall govern the election.
1697 2. If the employee chooses to move to the pension plan
1698 defined benefit program of the Florida Retirement System, the
1699 employee shall receive service credit equal to his or her years
1700 of service under the State University System Optional Retirement
1701 Program.
1702 a. The cost for such credit must be in shall be an amount
1703 representing the actuarial accrued liability for the affected
1704 period of service. The cost must shall be calculated using the
1705 discount rate and other relevant actuarial assumptions that were
1706 used to value the pension Florida Retirement System defined
1707 benefit plan liabilities in the most recent actuarial valuation.
1708 The calculation must shall include any service already
1709 maintained under the pension defined benefit plan in addition to
1710 the years under the State University System Optional Retirement
1711 Program. The actuarial accrued liability of any service already
1712 maintained under the pension defined benefit plan must shall be
1713 applied as a credit to total cost resulting from the
1714 calculation. The division must shall ensure that the transfer
1715 sum is prepared using a formula and methodology certified by an
1716 enrolled actuary.
1717 b. The employee must transfer from his or her State
1718 University System Optional Retirement Program account, and from
1719 other employee moneys as necessary, a sum representing the
1720 actuarial accrued liability immediately following the time of
1721 such movement, determined assuming that attained service equals
1722 the sum of service in the pension plan defined benefit program
1723 and service in the State University System Optional Retirement
1724 Program.
1725 (4) CONTRIBUTIONS.—
1726 (a)1. Through June 30, 2001, each employer shall contribute
1727 on behalf of each member of participant in the optional
1728 retirement program an amount equal to the normal cost portion of
1729 the employer retirement contribution which would be required if
1730 the employee participant were a regular member of the Florida
1731 Retirement System’s pension plan System defined benefit program,
1732 plus the portion of the contribution rate required in s.
1733 112.363(8) that would otherwise be assigned to the Retiree
1734 Health Insurance Subsidy Trust Fund.
1735 2. Effective July 1, 2001, through June 30, 2011, each
1736 employer shall contribute on behalf of each member of
1737 participant in the optional retirement program an amount equal
1738 to 10.43 percent of the employee’s participant’s gross monthly
1739 compensation.
1740 3. Effective July 1, 2011, each member of the optional
1741 retirement program shall contribute an amount equal to the
1742 employee contribution required in s. 121.71(3). The employer
1743 shall contribute on behalf of each such member an amount equal
1744 to the difference between 10.43 percent of the employee’s gross
1745 monthly compensation and the amount equal to the employee’s
1746 required contribution based on the employee’s gross monthly
1747 compensation.
1748 4. The department shall deduct an amount approved by the
1749 Legislature to provide for the administration of this program.
1750 The payment of the contributions, including contributions by the
1751 employee, to the optional program which is required by this
1752 paragraph for each participant shall be made by the employer to
1753 the department, which shall forward the contributions to the
1754 designated company or companies contracting for payment of
1755 benefits for member’s of the participant under the program.
1756 However, such contributions paid on behalf of an employee
1757 described in paragraph (3)(c) may shall not be forwarded to a
1758 company and do shall not begin to accrue interest until the
1759 employee has executed a contract and notified the department.
1760 The department shall deduct an amount from the contributions to
1761 provide for the administration of this program.
1762 (b) Each employer shall contribute on behalf of each member
1763 of participant in the optional retirement program an amount
1764 equal to the unfunded actuarial accrued liability portion of the
1765 employer contribution which would be required for members of the
1766 Florida Retirement System. This contribution shall be paid to
1767 the department for transfer to the Florida Retirement System
1768 Trust Fund.
1769 (c) An Optional Retirement Program Trust Fund shall be
1770 established in the State Treasury and administered by the
1771 department to make payments to the provider companies on behalf
1772 of the optional retirement program members participants, and to
1773 transfer the unfunded liability portion of the state optional
1774 retirement program contributions to the Florida Retirement
1775 System Trust Fund.
1776 (d) Contributions required for social security by each
1777 employer and each employee participant, in the amount required
1778 for social security coverage as now or hereafter may be provided
1779 by the federal Social Security Act, shall be maintained for each
1780 member of participant in the optional retirement program and are
1781 shall be in addition to the retirement contributions specified
1782 in this subsection.
1783 (e) Each member of participant in the optional retirement
1784 program who has executed a contract may contribute by way of
1785 salary reduction or deduction a percentage amount of the
1786 employee’s participant’s gross compensation not to exceed the
1787 percentage amount contributed by the employer to the optional
1788 program, but in no case may such contribution may not exceed
1789 federal limitations. Payment of the employee’s participant’s
1790 contributions shall be made by the financial officer of the
1791 employer to the division which shall forward the contributions
1792 to the designated company or companies contracting for payment
1793 of benefits for members the participant under the program. A
1794 member participant may not make, through salary reduction, any
1795 voluntary employee contributions to any other plan under s.
1796 403(b) of the Internal Revenue Code, with the exception of a
1797 custodial account under s. 403(b)(7) of the Internal Revenue
1798 Code, until he or she has made an employee contribution to his
1799 or her optional program equal to the employer contribution. An
1800 employee A participant is responsible for monitoring his or her
1801 individual tax-deferred income to ensure he or she does not
1802 exceed the maximum deferral amounts permitted under the Internal
1803 Revenue Code.
1804 (f) The Optional Retirement Trust Fund may accept for
1805 deposit into member participant contracts contributions in the
1806 form of rollovers or direct trustee-to-trustee transfers by or
1807 on behalf of members participants who are reasonably determined
1808 by the department to be eligible for rollover or transfer to the
1809 optional retirement program pursuant to the Internal Revenue
1810 Code, if such contributions are made in accordance with rules
1811 adopted by the department. Such contributions shall be accounted
1812 for in accordance with any applicable requirements of the
1813 Internal Revenue Code and department rules of the department.
1814 (g) Effective July 1, 2008, for purposes of paragraph (a)
1815 and notwithstanding s. 121.021(22)(b)1., the term “employee’s
1816 participant’s gross monthly compensation” includes salary
1817 payments made to eligible clinical faculty from a state
1818 university using funds provided by a faculty practice plan
1819 authorized by the Board of Governors of the State University
1820 System if:
1821 1. There is no not any employer contribution from the state
1822 university to any other retirement program with respect to such
1823 salary payments; and
1824 2. The employer contribution on behalf of a member of the
1825 participant in the optional retirement program with respect to
1826 such salary payments is made using funds provided by the faculty
1827 practice plan.
1828 Section 20. Subsections (1) and (2) of section 121.355,
1829 Florida Statutes, is amended to read:
1830 121.355 Community College Optional Retirement Program and
1831 State University System Optional Retirement Program member
1832 transfer.—Effective January 1, 2009, through December 31, 2009,
1833 an employee who is a former member of participant in the
1834 Community College Optional Retirement Program or the State
1835 University System Optional Retirement Program and present
1836 mandatory member of participant in the Florida Retirement
1837 System’s pension System defined benefit plan may receive service
1838 credit equal to his or her years of service under the Community
1839 College Optional Retirement Program or the State University
1840 System Optional Retirement Program under the following
1841 conditions:
1842 (1) The cost for such credit must represent shall be an
1843 amount representing the actuarial accrued liability for the
1844 affected period of service. The cost shall be calculated using
1845 the discount rate and other relevant actuarial assumptions that
1846 were used to value the Florida Retirement System’s pension
1847 System defined benefit plan liabilities in the most recent
1848 actuarial valuation. The calculation must shall include any
1849 service already maintained under the pension defined benefit
1850 plan in addition to the years under the Community College
1851 Optional Retirement Program or the State University System
1852 Optional Retirement Program. The actuarial accrued liability of
1853 any service already maintained under the pension defined benefit
1854 plan shall be applied as a credit to total cost resulting from
1855 the calculation. The division shall ensure that the transfer sum
1856 is prepared using a formula and methodology certified by an
1857 enrolled actuary.
1858 (2) The employee must transfer from his or her Community
1859 College Optional Retirement Program account or State University
1860 System Optional Retirement Program account, subject to the terms
1861 of the applicable optional retirement program contract, and from
1862 other employee moneys as necessary, a sum representing the
1863 actuarial accrued liability immediately following the time of
1864 such movement, determined assuming that attained service equals
1865 the sum of service in the pension plan defined benefit program
1866 and service in the Community College Optional Retirement Program
1867 or State University System Optional Retirement Program.
1868 Section 21. Section 121.4501, Florida Statutes, is amended
1869 to read:
1870 121.4501 Florida Public Employee Optional Retirement System
1871 Investment Plan Program.—
1872 (1) The Trustees of the State Board of Administration shall
1873 establish a an optional defined contribution retirement program
1874 called the Florida Retirement System Investment Plan for members
1875 of the Florida Retirement System under which retirement benefits
1876 are will be provided for eligible employees initially employed
1877 before July 1, 2011, who elect to enroll participate in the
1878 plan. Enrollment is compulsory for all eligible employees
1879 employed on or after July 1, 2011, except for those who are
1880 eligible to and elect to enroll in an optional retirement
1881 program established under s. 121.055(6), s. 121.35, or s.
1882 1012.875 program. The retirement benefits to be provided for or
1883 on behalf of participants in such optional retirement program
1884 shall be provided through employee-directed investments, in
1885 accordance with s. 401(a) of the Internal Revenue Code and its
1886 related regulations. The Employers and employees shall make
1887 contributions contribute, as provided in this section and, ss.
1888 121.571, and 121.71, to the Florida Public Employee Optional
1889 Retirement System Investment Plan Program Trust Fund toward the
1890 funding of such optional benefits.
1891 (2) DEFINITIONS.—As used in this part, the term:
1892 (a) “Approved provider” or “provider” means a private
1893 sector company that is selected and approved by the state board
1894 to offer one or more investment products or services to the
1895 investment plan optional retirement program. The term includes a
1896 bundled provider that offers plan members participants a range
1897 of individually allocated or unallocated investment products and
1898 may offer a range of administrative and customer services, which
1899 may include accounting and administration of individual member
1900 participant benefits and contributions; individual member
1901 participant recordkeeping; asset purchase, control, and
1902 safekeeping; direct execution of the member’s participant’s
1903 instructions as to asset and contribution allocation;
1904 calculation of daily net asset values; direct access to member
1905 participant account information; periodic reporting to members
1906 participants, at least quarterly, on account balances and
1907 transactions; guidance, advice, and allocation services directly
1908 relating to the provider’s own investment options or products,
1909 but only if the bundled provider complies with the standard of
1910 care of s. 404(a)(1)(A-B) of the Employee Retirement Income
1911 Security Act of 1974 (ERISA) and if providing such guidance,
1912 advice, or allocation services does not constitute a prohibited
1913 transaction under s. 4975(c)(1) of the Internal Revenue Code or
1914 s. 406 of ERISA, notwithstanding that such prohibited
1915 transaction provisions do not apply to the optional retirement
1916 program; a broad array of distribution options; asset
1917 allocation; and retirement counseling and education. Private
1918 sector companies include investment management companies,
1919 insurance companies, depositories, and mutual fund companies.
1920 (b) “Average monthly compensation” means one-twelfth of
1921 average final compensation as defined in s. 121.021.
1922 (c) “Covered employment” means employment in a regularly
1923 established position as defined in s. 121.021.
1924 (d) “Defined benefit program” means the defined benefit
1925 program of the Florida Retirement System administered under part
1926 I of this chapter.
1927 (d) “District school board employer” means a district
1928 school board that participates in the Florida Retirement System
1929 for the benefit of certain employees, or a charter school or
1930 charter technical career center that participates in the Florida
1931 Retirement System as provided under s. 121.051(2)(d).
1932 (e) “Division” means the Division of Retirement within the
1933 department.
1934 (f) “Electronic means” means by telephone, if the required
1935 information is received on a recorded line, or through Internet
1936 access, if the required information is captured online.
1937 (g) “Eligible employee” means an officer or employee, as
1938 defined in s. 121.021, who:
1939 1. Is a member of, or is eligible for membership in, the
1940 Florida Retirement System, including any renewed member of the
1941 Florida Retirement System initially enrolled before July 1,
1942 2010; or
1943 2. Participates in, or is eligible to participate in, the
1944 Senior Management Service Optional Annuity Program as
1945 established under s. 121.055(6), the State Community College
1946 System Optional Retirement Program as established under s.
1947 121.051(2)(c), or the State University System Optional
1948 Retirement Program established under s. 121.35.
1949
1950 The term does not include any member participating in the
1951 Deferred Retirement Option Program established under s.
1952 121.091(13), a retiree of a state-administered retirement system
1953 initially reemployed on or after July 1, 2010, or a mandatory
1954 member participant of the State University System Optional
1955 Retirement Program established under s. 121.35.
1956 (h) “Employer” means an employer, as defined in s. 121.021,
1957 of an eligible employee.
1958 (i) “Investment plan” means the Florida Retirement System
1959 Investment Plan, a defined contribution program established
1960 under this part.
1961 (j) “Local employer” means an employer that is not a state
1962 employer or a district school board employer.
1963 (i) “Optional retirement program” or “optional program”
1964 means the Public Employee Optional Retirement Program
1965 established under this part.
1966 (k)(j) “Member Participant” means an eligible employee who
1967 is enrolled enrolls in the investment plan optional program as
1968 provided in subsection (4) or a terminated Deferred Retirement
1969 Option Program participant as described in subsection (21).
1970 (l) “Pension plan” means the defined benefit program of the
1971 Florida Retirement System administered under part I of this
1972 chapter.
1973 (m)(k) “Retiree” means a former member participant of the
1974 investment plan optional retirement program who has terminated
1975 employment and has taken a distribution as provided in s.
1976 121.591, except for a mandatory distribution of a de minimis
1977 account authorized by the state board.
1978 (n) “State employer” means an agency, board, branch,
1979 commission, community college, department, institution,
1980 institution of higher education, or water management district
1981 that participates in the Florida Retirement System for the
1982 benefit of certain employees.
1983 (o)(l) “Vested” or “vesting” means the guarantee that a
1984 member participant is eligible to receive a retirement benefit
1985 upon completion of the required years of service under the
1986 investment plan optional retirement program.
1987 (3) ELIGIBILITY; RETIREMENT SERVICE CREDIT; TRANSFER OF
1988 BENEFITS.—
1989 (a) Participation in the Public Employee Optional
1990 Retirement Program is limited to eligible employees.
1991 Participation in the optional retirement program is in lieu of
1992 participation in the defined benefit program of the Florida
1993 Retirement System.
1994 (a)(b) An eligible employee who is employed in a regularly
1995 established position by a state employer on June 1, 2002; by a
1996 district school board employer on September 1, 2002; or by a
1997 local employer on December 1, 2002, and who is a member of the
1998 pension plan defined benefit retirement program of the Florida
1999 Retirement System at the time of his or her election to enroll
2000 participate in the investment plan Public Employee Optional
2001 Retirement Program shall retain all retirement service credit
2002 earned under the pension plan defined benefit retirement program
2003 of the Florida Retirement System as credited under the Florida
2004 Retirement System and is shall be entitled to a deferred benefit
2005 upon termination, if eligible under the system. However,
2006 election to enroll participate in the investment plan Public
2007 Employee Optional Retirement Program terminates the active
2008 membership of the employee in the pension plan defined benefit
2009 program of the Florida Retirement System, and the service of a
2010 member of participant in the investment plan is Public Employee
2011 Optional Retirement Program shall not be creditable under the
2012 pension plan defined benefit retirement program of the Florida
2013 Retirement System for purposes of benefit accrual but is
2014 creditable shall be credited for purposes of vesting.
2015 (b)(c)1. Notwithstanding paragraph (a), an (b), each
2016 eligible employee who elects to enroll participate in the
2017 investment plan Public Employee Optional Retirement Program and
2018 establishes one or more individual member participant accounts
2019 under the optional program may elect to transfer to the
2020 investment plan optional program a sum representing the present
2021 value of the employee’s accumulated benefit obligation under the
2022 pension plan defined benefit retirement program of the Florida
2023 Retirement System. Upon such transfer, all service credit
2024 previously earned under the pension plan is defined benefit
2025 program of the Florida Retirement System shall be nullified for
2026 purposes of entitlement to a future benefit under the pension
2027 plan defined benefit program of the Florida Retirement System. A
2028 member may not transfer participant is precluded from
2029 transferring the accumulated benefit obligation balance from the
2030 pension plan after the time defined benefit program upon the
2031 expiration of the period for enrolling afforded to enroll in the
2032 investment plan optional program.
2033 1.2. For purposes of this subsection, the present value of
2034 the member’s accumulated benefit obligation is based upon the
2035 member’s estimated creditable service and estimated average
2036 final compensation under the pension plan defined benefit
2037 program, subject to recomputation under subparagraph 2. 3. For
2038 state employees enrolling under subparagraph (4)(a)1., initial
2039 estimates shall will be based upon creditable service and
2040 average final compensation as of midnight on June 30, 2002; for
2041 district school board employees enrolling under subparagraph
2042 (4)(b)1., initial estimates shall will be based upon creditable
2043 service and average final compensation as of midnight on
2044 September 30, 2002; and for local government employees enrolling
2045 under subparagraph (4)(c)1., initial estimates shall will be
2046 based upon creditable service and average final compensation as
2047 of midnight on December 31, 2002. The dates respectively
2048 specified are above shall be construed as the “estimate date”
2049 for these employees. The actuarial present value of the
2050 employee’s accumulated benefit obligation shall be based on the
2051 following:
2052 a. The discount rate and other relevant actuarial
2053 assumptions used to value the Florida Retirement System Trust
2054 Fund at the time the amount to be transferred is determined,
2055 consistent with the factors provided in sub-subparagraphs b. and
2056 c.
2057 b. A benefit commencement age, based on the member’s
2058 estimated creditable service as of the estimate date. The
2059 benefit commencement age is shall be the younger of the
2060 following, but may shall not be younger than the member’s age as
2061 of the estimate date:
2062 (I) Age 62; or
2063 (II) The age the member would attain if the member
2064 completed 30 years of service with an employer, assuming the
2065 member worked continuously from the estimate date, and
2066 disregarding any vesting requirement that would otherwise apply
2067 under the pension plan defined benefit program of the Florida
2068 Retirement System.
2069 c. For members of the Special Risk Class, and for members
2070 of the Special Risk Administrative Support Class entitled to
2071 retain the special risk normal retirement date, the benefit
2072 commencement age is shall be the younger of the following, but
2073 may shall not be younger than the member’s age as of the
2074 estimate date:
2075 (I) Age 55; or
2076 (II) The age the member would attain if the member
2077 completed 25 years of service with an employer, assuming the
2078 member worked continuously from the estimate date, and
2079 disregarding any vesting requirement that would otherwise apply
2080 under the pension plan defined benefit program of the Florida
2081 Retirement System.
2082 d. The calculation must shall disregard vesting
2083 requirements and early retirement reduction factors that would
2084 otherwise apply under the pension plan defined benefit
2085 retirement program.
2086 2.3. For each member participant who elects to transfer
2087 moneys from the pension plan defined benefit program to his or
2088 her account in the investment plan optional program, the
2089 division shall recompute the amount transferred under
2090 subparagraph 1. within 2. not later than 60 days after the
2091 actual transfer of funds based upon the member’s participant’s
2092 actual creditable service and actual final average compensation
2093 as of the initial date of participation in the investment plan
2094 optional program. If the recomputed amount differs from the
2095 amount transferred under subparagraph 2. by $10 or more, the
2096 division shall:
2097 a. Transfer, or cause to be transferred, from the Florida
2098 Retirement System Trust Fund to the member’s participant’s
2099 account in the optional program the excess, if any, of the
2100 recomputed amount over the previously transferred amount
2101 together with interest from the initial date of transfer to the
2102 date of transfer under this subparagraph, based upon the
2103 effective annual interest equal to the assumed return on the
2104 actuarial investment which was used in the most recent actuarial
2105 valuation of the system, compounded annually.
2106 b. Transfer, or cause to be transferred, from the member’s
2107 participant’s account to the Florida Retirement System Trust
2108 Fund the excess, if any, of the previously transferred amount
2109 over the recomputed amount, together with interest from the
2110 initial date of transfer to the date of transfer under this
2111 subparagraph, based upon 6 percent effective annual interest,
2112 compounded annually, pro rata based on the member’s
2113 participant’s allocation plan.
2114 3. If contribution adjustments are made as a result of
2115 employer errors or corrections, including plan corrections,
2116 following recomputation of the amount transferred under
2117 subparagraph 1., the member is entitled to the additional
2118 contributions or is responsible for returning any excess
2119 contributions resulting from the correction if the return of
2120 such contributions by the plan is made within 1 year after the
2121 making of the erroneous contributions or such other period
2122 allowed by applicable Internal Revenue Service guidance. The
2123 present value of the member’s accumulated benefit obligation may
2124 not be recalculated.
2125 4. As directed by the member participant, the state board
2126 shall transfer or cause to be transferred the appropriate
2127 amounts to the designated accounts within. The board shall
2128 establish transfer procedures by rule, but the actual transfer
2129 shall not be later than 30 days after the effective date of the
2130 member’s participation in the investment plan optional program
2131 unless the major financial markets for securities available for
2132 a transfer are seriously disrupted by an unforeseen event that
2133 which also causes the suspension of trading on any national
2134 securities exchange in the country where the securities are were
2135 issued. In that event, the such 30-day period of time may be
2136 extended by a resolution of the state board trustees. The state
2137 board shall establish transfer procedures by rule. Transfers are
2138 not commissionable or subject to other fees and may be in the
2139 form of securities or cash, as determined by the state board.
2140 Such securities are shall be valued as of the date of receipt in
2141 the member’s participant’s account.
2142 5. If the state board or the division receives notification
2143 from the United States Internal Revenue Service that this
2144 paragraph or any portion of this paragraph will cause the
2145 retirement system, or a portion thereof, to be disqualified for
2146 tax purposes under the Internal Revenue Code, then the portion
2147 that will cause the disqualification does not apply. Upon such
2148 notice, the state board and the division shall notify the
2149 presiding officers of the Legislature.
2150 (4) PARTICIPATION; ENROLLMENT.—
2151 (a)1. With respect to an eligible employee who is employed
2152 in a regularly established position by a state employer after on
2153 June 1, 2002; by a district school board employer after
2154 September 1, 2002; or by a local employer after December 1,
2155 2002, but before July 1, 2011, the, by a state employer:
2156 a. Any such employee may elect to participate in the Public
2157 Employee Optional Retirement Program in lieu of retaining his or
2158 her membership in the defined benefit program of the Florida
2159 Retirement System. The election must be made in writing or by
2160 electronic means and must be filed with the third-party
2161 administrator by August 31, 2002, or, in the case of an active
2162 employee who is on a leave of absence on April 1, 2002, by the
2163 last business day of the 5th month following the month the leave
2164 of absence concludes. This election is irrevocable, except as
2165 provided in paragraph (e). Upon making such election, the
2166 employee shall be enrolled as a participant of the Public
2167 Employee Optional Retirement Program, the employee’s membership
2168 in the Florida Retirement System shall be governed by the
2169 provisions of this part, and the employee’s membership in the
2170 defined benefit program of the Florida Retirement System shall
2171 terminate. The employee’s enrollment in the Public Employee
2172 Optional Retirement Program shall be effective the first day of
2173 the month for which a full month’s employer contribution is made
2174 to the optional program.
2175 b. Any such employee who fails to elect to participate in
2176 the Public Employee Optional Retirement Program within the
2177 prescribed time period is deemed to have elected to retain
2178 membership in the defined benefit program of the Florida
2179 Retirement System, and the employee’s option to elect to
2180 participate in the optional program is forfeited.
2181 2. With respect to employees who become eligible to
2182 participate in the Public Employee Optional Retirement Program
2183 by reason of employment in a regularly established position with
2184 a state employer commencing after April 1, 2002:
2185 a. Any such employee shall, by default, be enrolled in the
2186 pension plan defined benefit retirement program of the Florida
2187 Retirement System at the commencement of employment, and may, by
2188 the last business day of the 5th month following the employee’s
2189 month of hire, elect to enroll participate in the investment
2190 plan Public Employee Optional Retirement Program. The employee’s
2191 election must be made in writing or by electronic means and must
2192 be filed with the third-party administrator. The election to
2193 enroll participate in the investment plan optional program is
2194 irrevocable, except as provided in paragraph (e).
2195 1.b. If the employee files such election within the
2196 prescribed time period, enrollment in the investment plan is
2197 optional program shall be effective on the first day of
2198 employment. The employer and employee retirement contributions
2199 paid through the month of the employee plan change shall be
2200 transferred to the investment plan optional program, and,
2201 effective the first day of the next month, the employer and
2202 employee must shall pay the applicable contributions based on
2203 the employee membership class in the plan optional program.
2204 2.c. An Any such employee who fails to elect to enroll
2205 participate in the investment plan Public Employee Optional
2206 Retirement Program within the prescribed time period is deemed
2207 to have elected to retain membership in the pension plan defined
2208 benefit program of the Florida Retirement System, and the
2209 employee’s option to elect to enroll participate in the
2210 investment plan optional program is forfeited.
2211 3. With respect to employees who become eligible to enroll
2212 participate in the investment plan Public Employee Optional
2213 Retirement Program pursuant to s. 121.051(2)(c)3. or s.
2214 121.35(3)(i), the any such employee may elect to enroll
2215 participate in the investment plan Public Employee Optional
2216 Retirement Program in lieu of retaining his or her participation
2217 in the State Community College System Optional Retirement
2218 Program or the State University System Optional Retirement
2219 Program. The election must be made in writing or by electronic
2220 means and must be filed with the third-party administrator. This
2221 election is irrevocable, except as provided in paragraph (e).
2222 Upon making such election, the employee shall be enrolled in as
2223 a participant of the investment plan Public Employee Optional
2224 Retirement Program, the employee’s membership in the Florida
2225 Retirement System shall be governed by the provisions of this
2226 part, and the employee’s participation in the State Community
2227 College System Optional Retirement Program or the State
2228 University System Optional Retirement Program shall terminate.
2229 The employee’s enrollment in the investment plan is Public
2230 Employee Optional Retirement Program shall be effective on the
2231 first day of the month for which a full month’s employer
2232 employee contributions are contribution is made to the
2233 investment plan optional program.
2234 4. For purposes of this paragraph, “state employer” means
2235 any agency, board, branch, commission, community college,
2236 department, institution, institution of higher education, or
2237 water management district of the state, which participates in
2238 the Florida Retirement System for the benefit of certain
2239 employees.
2240 (b)1. With respect to an eligible employee who is employed
2241 in a regularly established position on September 1, 2002, by a
2242 district school board employer:
2243 a. Any such employee may elect to participate in the Public
2244 Employee Optional Retirement Program in lieu of retaining his or
2245 her membership in the defined benefit program of the Florida
2246 Retirement System. The election must be made in writing or by
2247 electronic means and must be filed with the third-party
2248 administrator by November 30, or, in the case of an active
2249 employee who is on a leave of absence on July 1, 2002, by the
2250 last business day of the 5th month following the month the leave
2251 of absence concludes. This election is irrevocable, except as
2252 provided in paragraph (e). Upon making such election, the
2253 employee shall be enrolled as a participant of the Public
2254 Employee Optional Retirement Program, the employee’s membership
2255 in the Florida Retirement System shall be governed by the
2256 provisions of this part, and the employee’s membership in the
2257 defined benefit program of the Florida Retirement System shall
2258 terminate. The employee’s enrollment in the Public Employee
2259 Optional Retirement Program shall be effective the first day of
2260 the month for which a full month’s employer contribution is made
2261 to the optional program.
2262 b. Any such employee who fails to elect to participate in
2263 the Public Employee Optional Retirement Program within the
2264 prescribed time period is deemed to have elected to retain
2265 membership in the defined benefit program of the Florida
2266 Retirement System, and the employee’s option to elect to
2267 participate in the optional program is forfeited.
2268 2. With respect to employees who become eligible to
2269 participate in the Public Employee Optional Retirement Program
2270 by reason of employment in a regularly established position with
2271 a district school board employer commencing after July 1, 2002:
2272 a. Any such employee shall, by default, be enrolled in the
2273 defined benefit retirement program of the Florida Retirement
2274 System at the commencement of employment, and may, by the last
2275 business day of the 5th month following the employee’s month of
2276 hire, elect to participate in the Public Employee Optional
2277 Retirement Program. The employee’s election must be made in
2278 writing or by electronic means and must be filed with the third
2279 party administrator. The election to participate in the optional
2280 program is irrevocable, except as provided in paragraph (e).
2281 b. If the employee files such election within the
2282 prescribed time period, enrollment in the optional program shall
2283 be effective on the first day of employment. The employer
2284 retirement contributions paid through the month of the employee
2285 plan change shall be transferred to the optional program, and,
2286 effective the first day of the next month, the employer shall
2287 pay the applicable contributions based on the employee
2288 membership class in the optional program.
2289 c. Any such employee who fails to elect to participate in
2290 the Public Employee Optional Retirement Program within the
2291 prescribed time period is deemed to have elected to retain
2292 membership in the defined benefit program of the Florida
2293 Retirement System, and the employee’s option to elect to
2294 participate in the optional program is forfeited.
2295 3. For purposes of this paragraph, “district school board
2296 employer” means any district school board that participates in
2297 the Florida Retirement System for the benefit of certain
2298 employees, or a charter school or charter technical career
2299 center that participates in the Florida Retirement System as
2300 provided in s. 121.051(2)(d).
2301 (c)1. With respect to an eligible employee who is employed
2302 in a regularly established position on December 1, 2002, by a
2303 local employer:
2304 a. Any such employee may elect to participate in the Public
2305 Employee Optional Retirement Program in lieu of retaining his or
2306 her membership in the defined benefit program of the Florida
2307 Retirement System. The election must be made in writing or by
2308 electronic means and must be filed with the third-party
2309 administrator by February 28, 2003, or, in the case of an active
2310 employee who is on a leave of absence on October 1, 2002, by the
2311 last business day of the 5th month following the month the leave
2312 of absence concludes. This election is irrevocable, except as
2313 provided in paragraph (e). Upon making such election, the
2314 employee shall be enrolled as a participant of the Public
2315 Employee Optional Retirement Program, the employee’s membership
2316 in the Florida Retirement System shall be governed by the
2317 provisions of this part, and the employee’s membership in the
2318 defined benefit program of the Florida Retirement System shall
2319 terminate. The employee’s enrollment in the Public Employee
2320 Optional Retirement Program shall be effective the first day of
2321 the month for which a full month’s employer contribution is made
2322 to the optional program.
2323 b. Any such employee who fails to elect to participate in
2324 the Public Employee Optional Retirement Program within the
2325 prescribed time period is deemed to have elected to retain
2326 membership in the defined benefit program of the Florida
2327 Retirement System, and the employee’s option to elect to
2328 participate in the optional program is forfeited.
2329 2. With respect to employees who become eligible to
2330 participate in the Public Employee Optional Retirement Program
2331 by reason of employment in a regularly established position with
2332 a local employer commencing after October 1, 2002:
2333 a. Any such employee shall, by default, be enrolled in the
2334 defined benefit retirement program of the Florida Retirement
2335 System at the commencement of employment, and may, by the last
2336 business day of the 5th month following the employee’s month of
2337 hire, elect to participate in the Public Employee Optional
2338 Retirement Program. The employee’s election must be made in
2339 writing or by electronic means and must be filed with the third
2340 party administrator. The election to participate in the optional
2341 program is irrevocable, except as provided in paragraph (e).
2342 b. If the employee files such election within the
2343 prescribed time period, enrollment in the optional program shall
2344 be effective on the first day of employment. The employer
2345 retirement contributions paid through the month of the employee
2346 plan change shall be transferred to the optional program, and,
2347 effective the first day of the next month, the employer shall
2348 pay the applicable contributions based on the employee
2349 membership class in the optional program.
2350 c. Any such employee who fails to elect to participate in
2351 the Public Employee Optional Retirement Program within the
2352 prescribed time period is deemed to have elected to retain
2353 membership in the defined benefit program of the Florida
2354 Retirement System, and the employee’s option to elect to
2355 participate in the optional program is forfeited.
2356 3. For purposes of this paragraph, “local employer” means
2357 any employer not included in paragraph (a) or paragraph (b).
2358 (b)(d) Contributions available for self-direction by a
2359 member participant who has not selected one or more specific
2360 investment products shall be allocated as prescribed by the
2361 state board. The third-party administrator shall notify the
2362 member any such participant at least quarterly that the member
2363 participant should take an affirmative action to make an asset
2364 allocation among the investment plan optional program products.
2365 (c) On or after July 1, 2011, a member of the pension plan
2366 who obtains a refund of employee contributions retains his or
2367 her prior plan choice upon return to employment in a regularly
2368 established position with a participating employer.
2369 (d) A member of the investment plan who takes a
2370 distribution of any contributions from his investment plan
2371 account is considered a retiree. Upon reemployment in a
2372 regularly established position with a participating employer,
2373 the member returns as a new hire and, if applicable, may
2374 participate in the Florida Retirement System.
2375 (e) After the period during which an eligible employee had
2376 the choice to elect the pension plan defined benefit program or
2377 the investment plan optional retirement program, or the month
2378 following the receipt of the eligible employee’s plan election,
2379 if sooner, the employee shall have one opportunity, at the
2380 employee’s discretion, to choose to move from the pension plan
2381 defined benefit program to the investment plan optional
2382 retirement program or from the investment plan optional
2383 retirement program to the pension plan defined benefit program.
2384 Eligible employees may elect to move between Florida Retirement
2385 System programs only if they are earning service credit in an
2386 employer-employee relationship consistent with s.
2387 121.021(17)(b), excluding leaves of absence without pay.
2388 Effective July 1, 2005, such elections are effective on the
2389 first day of the month following the receipt of the election by
2390 the third-party administrator and are not subject to the
2391 requirements regarding an employer-employee relationship or
2392 receipt of contributions for the eligible employee in the
2393 effective month, except when the election is received by the
2394 third-party administrator. This paragraph is contingent upon
2395 receiving approval from the Internal Revenue Service to include
2396 for including the choice described herein within the programs
2397 offered by the Florida Retirement System.
2398 1. If the employee chooses to move to the investment plan
2399 optional retirement program, the applicable provisions of
2400 subsection (3) this section shall govern the transfer.
2401 2. If the employee chooses to move to the pension plan
2402 defined benefit program, the employee must transfer from his or
2403 her investment plan optional retirement program account, and
2404 from other employee moneys as necessary, a sum representing the
2405 present value of that employee’s accumulated benefit obligation
2406 immediately following the time of such movement, determined
2407 assuming that attained service equals the sum of service in the
2408 pension plan defined benefit program and service in the
2409 investment plan optional retirement program. Benefit
2410 commencement occurs on the first date the employee is eligible
2411 for unreduced benefits, using the discount rate and other
2412 relevant actuarial assumptions that were used to value the
2413 pension defined benefit plan liabilities in the most recent
2414 actuarial valuation. For any employee who, at the time of the
2415 second election, already maintains an accrued benefit amount in
2416 the pension plan defined benefit program, the then-present value
2417 of the accrued benefit shall be deemed part of the required
2418 transfer amount. The division shall ensure that the transfer sum
2419 is prepared using a formula and methodology certified by an
2420 enrolled actuary. A refund of any employee contributions or
2421 additional employee payments which exceed the employee
2422 contributions that would have accrued had the employee remained
2423 in the pension plan and not transferred to the investment plan
2424 is not permitted.
2425 3. Notwithstanding subparagraph 2., an employee who chooses
2426 to move to the pension plan defined benefit program and who
2427 became eligible to participate in the optional retirement
2428 program by reason of employment in a regularly established
2429 position with a state employer after June 1, 2002; a district
2430 school board employer after September 1, 2002; or a local
2431 employer after December 1, 2002, must transfer from his or her
2432 investment plan optional retirement program account, and from
2433 other employee moneys as necessary, a sum representing the
2434 employee’s actuarial accrued liability. A refund of any employee
2435 contributions or additional employee payments which exceed the
2436 employee contributions that would have accrued had the employee
2437 remained in the pension plan and not transferred to the
2438 investment plan is not permitted.
2439 4. An employee’s ability to transfer from the pension plan
2440 defined benefit program to the investment plan optional
2441 retirement program pursuant to paragraphs (a) and (b) (a)-(d),
2442 and the ability of a current employee to have an option to later
2443 transfer back into the pension plan defined benefit program
2444 under subparagraph 2., shall be deemed a significant system
2445 amendment. Pursuant to s. 121.031(4), any resulting unfunded
2446 liability arising from actual original transfers from the
2447 pension plan defined benefit program to the investment plan
2448 optional program must be amortized within 30 plan years as a
2449 separate unfunded actuarial base independent of the reserve
2450 stabilization mechanism defined in s. 121.031(3)(f). For the
2451 first 25 years, a direct amortization payment may not be
2452 calculated for this base. During this 25-year period, the
2453 separate base shall be used to offset the impact of employees
2454 exercising their second program election under this paragraph.
2455 It is the intent of the Legislature that the actuarial funded
2456 status of the pension plan defined benefit program not be
2457 affected by such second program elections in any significant
2458 manner, after due recognition of the separate unfunded actuarial
2459 base. Following the initial 25-year period, any remaining
2460 balance of the original separate base shall be amortized over
2461 the remaining 5 years of the required 30-year amortization
2462 period.
2463 5. If the employee chooses to transfer from the investment
2464 plan optional retirement program to the pension plan defined
2465 benefit program and retains an excess account balance in the
2466 investment plan optional program after satisfying the buy-in
2467 requirements under this paragraph, the excess may not be
2468 distributed until the member retires from the pension plan
2469 defined benefit program. The excess account balance may be
2470 rolled over to the pension plan defined benefit program and used
2471 to purchase service credit or upgrade creditable service in that
2472 program.
2473 (f) On or after July 1, 2011, an employee in the pension
2474 plan who obtains a refund of employee contributions shall retain
2475 his or her prior plan choice upon return to employment in a
2476 regularly established position with an employer participating in
2477 the Florida Retirement System.
2478 (g) A member who terminates covered employment in the
2479 Florida Retirement System and takes a distribution of any
2480 contributions from his investment plan account is considered a
2481 retiree. Upon reemployment in a regularly established position
2482 with a covered employer, the retiree returns as a new hire and,
2483 if applicable, may participate in the Florida Retirement System.
2484 (h) All eligible employees initially enrolled on or after
2485 July 1, 2011, except those who are eligible to and elect to
2486 enroll in an optional retirement program established under s.
2487 121.055(6), s. 121.35, or s. 1012.875, are compulsory members of
2488 the investment plan and membership in the pension plan is not
2489 permitted except as provided in s. 121.591. Such employees may
2490 not use the election opportunity specified in paragraph (e).
2491 (5) CONTRIBUTIONS.—
2492 (a) The Each employer and employee shall make the required
2493 contributions to the investment plan based on a percentage of
2494 the employee’s gross monthly compensation contribute on behalf
2495 of each participant in the Public Employee optional retirement
2496 Program, as provided in part III of this chapter.
2497 (b) Employee contributions shall be paid on a pretax basis,
2498 as provided in s. 401 of the Internal Revenue Code. Such
2499 contributions may not exceed federal limitations. An employee is
2500 responsible for monitoring his or her individual contributions
2501 to ensure that he or she does not exceed the maximum deferral
2502 amounts permitted under the Internal Revenue Code. A employee’s
2503 total contribution equals the sum of all amounts deducted from
2504 the employee’s salary by his or her employer in accordance with
2505 s. 121.71(2) and credited to his or her individual account in
2506 the investment plan, plus any earnings on such amounts and any
2507 contributions specified in paragraph (e).
2508 (c) The state board, acting as plan fiduciary, shall ensure
2509 that all plan assets are held in a trust, pursuant to s. 401 of
2510 the Internal Revenue Code. The fiduciary shall ensure that said
2511 contributions are allocated as follows:
2512 1. The employer and employee portion earmarked for member
2513 participant accounts shall be used to purchase interests in the
2514 appropriate investment vehicles for the accounts of each
2515 participant as specified by the member participant, or in
2516 accordance with paragraph (4)(b) (4)(d).
2517 2. The employer portion earmarked for administrative and
2518 educational expenses shall be transferred to the state board.
2519 3. The employer portion earmarked for disability benefits
2520 shall be transferred to the department.
2521 (d)(b) Employers are responsible for notifying employees
2522 participants regarding maximum contribution levels authorized
2523 permitted under the Internal Revenue Code. If a member
2524 participant contributes to any other tax-deferred plan, he or
2525 she is responsible for ensuring that total contributions made to
2526 the investment plan optional program and to any other such plan
2527 do not exceed federally permitted maximums.
2528 (e)(c) The investment plan Public Employee Optional
2529 Retirement Program may accept for deposit into member
2530 participant accounts contributions in the form of rollovers or
2531 direct trustee-to-trustee transfers by or on behalf of members
2532 participants, reasonably determined by the state board to be
2533 eligible for rollover or transfer to the investment plan
2534 optional retirement program pursuant to the Internal Revenue
2535 Code, if such contributions are made in accordance with rules as
2536 may be adopted by the board. Such contributions must shall be
2537 accounted for in accordance with any applicable Internal Revenue
2538 Code requirements and rules of the state board.
2539 (6) VESTING REQUIREMENTS.—
2540 (a) A member is fully and immediately vested in all
2541 employee contributions paid to the investment plan as provided
2542 in s. 121.72(2), plus interest and earnings thereon and less
2543 investment fees and administrative charges.
2544 (b)(a)1. With respect to employer contributions paid on
2545 behalf of a member of the participant to the investment plan
2546 optional retirement program, plus interest and earnings thereon
2547 and less investment fees and administrative charges, a member
2548 who voluntarily elected to enroll in the investment plan before
2549 July 1, 2011, or an eligible employee initially enrolled in the
2550 Florida Retirement System before July 1, 2011, who has the
2551 option to voluntarily elect to enroll in the investment plan,
2552 participant is vested after completing 1 work year with an
2553 employer, including any service while the employee participant
2554 was a member of the pension plan defined benefit program or an
2555 optional retirement program authorized under s. 121.051(2)(c),
2556 or s. 121.055(6), or s. 121.35.
2557 2. With respect to employer contributions paid on behalf of
2558 the member of the investment plan, plus interest and earnings
2559 thereon and less investment fees and administrative charges, an
2560 employee initially enrolled in the Florida Retirement System on
2561 or after July 1, 2011, is vested according to the following
2562 schedule:
2563 a. Prior to completion of 3 years of service.............0%
2564 b. Upon completion of 3 years of service................40%
2565 c. Upon completion of 4 years of service................80%
2566 d. Upon completion of 5 or more years of service.......100%
2567
2568 Years of service includes any service completed while the
2569 employee was a member of the pension plan or an optional
2570 retirement program authorized under s. 121.051(2)(c), s.
2571 121.055(6), or s. 121.35.
2572 3.2. If the member participant terminates employment before
2573 satisfying the vesting requirements, the nonvested accumulation
2574 must be transferred from the member’s participant’s accounts to
2575 the state board for deposit and investment by the state board in
2576 the suspense account created within the Florida Public Employee
2577 Optional Retirement System Investment Plan Program Trust Fund.
2578 If the terminated member participant is reemployed as an
2579 eligible employee within 5 years, the state board shall transfer
2580 to the member’s participant’s account any amount previously
2581 transferred from the member’s participant’s accounts to the
2582 suspense account, plus actual earnings on such amount while in
2583 the suspense account.
2584 (c)(b)1. With respect to amounts transferred from the
2585 pension plan defined benefit program to the investment plan
2586 program, plus interest and earnings, and less investment fees
2587 and administrative charges, a member participant shall be vested
2588 in the employer amount transferred upon meeting the service
2589 requirements for the employee’s participant’s membership class
2590 as set forth in s. 121.021(29). The third-party administrator
2591 shall account for such amounts for each member participant. The
2592 division shall notify the member participant and the third-party
2593 administrator when the member participant has satisfied the
2594 vesting period for Florida Retirement System purposes.
2595 2. If the member participant terminates employment before
2596 satisfying the vesting requirements, the nonvested employer
2597 accumulation must be transferred from the member’s participant’s
2598 accounts to the state board for deposit and investment by the
2599 state board in the suspense account created within the Florida
2600 Public Employee Optional Retirement System Investment Plan
2601 Program Trust Fund. If the terminated member participant is
2602 reemployed as an eligible employee within 5 years, the state
2603 board shall transfer to the member’s participant’s account any
2604 amount previously transferred from the member’s participant’s
2605 accounts to the suspense account, plus the actual earnings on
2606 such amount while in the suspense account.
2607 (d)(c) Any nonvested accumulations transferred from a
2608 member’s participant’s account to the state board’s suspense
2609 account, including any accompanying services credit, shall be
2610 forfeited by the member participant if the member participant is
2611 not reemployed as an eligible employee within 5 years after
2612 termination.
2613 (e) If the member elects to receive any of his or her
2614 vested employer or employee contributions upon termination of
2615 employment as defined in s. 121.021, except for a mandatory
2616 distribution of a de minimis account authorized by the state
2617 board or a minimum required distribution provided by s.
2618 401(a)(9) of the Internal Revenue Code, the employee shall
2619 forfeit all nonvested employer contributions and accompanying
2620 service credit paid on behalf of the employee to the investment
2621 plan.
2622 (7) BENEFITS.—Under the investment plan the normal
2623 retirement date is the date on which a member attains age 62 or
2624 completes 5 years of service, whichever occurs later. Plan
2625 benefits must Public Employee Optional Retirement program:
2626 (a) Benefits shall Be provided in accordance with s. 401(a)
2627 of the Internal Revenue Code.
2628 (b) Benefits shall Accrue in individual accounts that are
2629 member-directed participant-directed, portable, and funded by
2630 employer contributions and earnings thereon.
2631 (c) Benefits shall Be payable in accordance with the
2632 provisions of s. 121.591.
2633 (8) ADMINISTRATION OF PLAN PROGRAM.—
2634 (a) The investment plan optional retirement program shall
2635 be administered by the state board and affected employers. The
2636 state board may require oaths, by affidavit or otherwise, and
2637 acknowledgments from persons in connection with the
2638 administration of its statutory duties and responsibilities for
2639 the plan this program. An oath, by affidavit or otherwise, may
2640 not be required of an employee participant at the time of
2641 enrollment. For members enrolled before July 1, 2011,
2642 acknowledgment of an employee’s election to enroll participate
2643 in the plan may program shall be no greater than necessary to
2644 confirm the employee’s election. The state board shall adopt
2645 rules to carry out its statutory duties with respect to
2646 administering the investment plan optional retirement program,
2647 including establishing the roles and responsibilities of
2648 affected state, local government, and education-related
2649 employers, the state board, the department, and third-party
2650 contractors. The department shall adopt rules necessary to
2651 administer the investment plan optional program in coordination
2652 with the pension plan defined benefit program and the disability
2653 benefits available under the investment plan optional program.
2654 (a)(b)1. The state board shall select and contract with a
2655 one third-party administrator to provide administrative services
2656 if those services cannot be competitively and contractually
2657 provided by the division of Retirement within the Department of
2658 Management Services. With the approval of the state board, the
2659 third-party administrator may subcontract with other
2660 organizations or individuals to provide components of the
2661 administrative services. As a cost of administration, the state
2662 board may compensate any such contractor for its services, in
2663 accordance with the terms of the contract, as is deemed
2664 necessary or proper by the board. The third-party administrator
2665 may not be an approved provider or be affiliated with an
2666 approved provider.
2667 2. These administrative services may include, but are not
2668 limited to, enrollment of eligible employees, collection of
2669 employer and employee contributions, disbursement of such
2670 contributions to approved providers in accordance with the
2671 allocation directions of members participants; services relating
2672 to consolidated billing; individual and collective recordkeeping
2673 and accounting; asset purchase, control, and safekeeping; and
2674 direct disbursement of funds to and from the third-party
2675 administrator, the division, the state board, employers, plan
2676 members participants, approved providers, and beneficiaries.
2677 This section does not prevent or prohibit a bundled provider
2678 from providing any administrative or customer service, including
2679 accounting and administration of individual member participant
2680 benefits and contributions; individual member participant
2681 recordkeeping; asset purchase, control, and safekeeping; direct
2682 execution of the member’s participant’s instructions as to asset
2683 and contribution allocation; calculation of daily net asset
2684 values; direct access to member participant account information;
2685 or periodic reporting to members participants, at least
2686 quarterly, on account balances and transactions, if these
2687 services are authorized by the state board as part of the
2688 contract.
2689 (b)1.3. The state board shall select and contract with one
2690 or more organizations to provide educational services. With
2691 approval of the state board, the organizations may subcontract
2692 with other organizations or individuals to provide components of
2693 the educational services. As a cost of administration, the state
2694 board may compensate any such contractor for its services in
2695 accordance with the terms of the contract, as is deemed
2696 necessary or proper by the board. The education organization may
2697 not be an approved provider or be affiliated with an approved
2698 provider.
2699 2.4. Educational services shall be designed by the state
2700 board and department to assist employers, eligible employees,
2701 members participants, and beneficiaries in order to maintain
2702 compliance with United States Department of Labor regulations
2703 under s. 404(c) of the Employee Retirement Income Security Act
2704 of 1974, and to assist employees in understanding their choice
2705 of defined benefit or defined contribution retirement program,
2706 and, if applicable, the choice between the pension plan and the
2707 investment plan alternatives. Educational services include, but
2708 are not limited to, disseminating educational materials;
2709 providing retirement planning education; explaining the pension
2710 differences between the defined benefit retirement plan and the
2711 investment defined contribution retirement plan; and offering
2712 financial planning guidance on matters such as investment
2713 diversification, investment risks, investment costs, and asset
2714 allocation. An approved provider may also provide educational
2715 information, including retirement planning and investment
2716 allocation information concerning its products and services.
2717 (c)1. In evaluating and selecting a third-party
2718 administrator, the state board shall establish criteria for
2719 evaluating under which it shall consider the relative
2720 capabilities and qualifications of each proposed administrator.
2721 In developing such criteria, the state board shall consider:
2722 a. The administrator’s demonstrated experience in providing
2723 administrative services to public or private sector retirement
2724 systems.
2725 b. The administrator’s demonstrated experience in providing
2726 daily valued recordkeeping for investment to defined
2727 contribution plans.
2728 c. The administrator’s ability and willingness to
2729 coordinate its activities with the Florida Retirement System
2730 employers, the state board, and the division, and to supply to
2731 such employers, the board, and the division the information and
2732 data they require, including, but not limited to, monthly
2733 management reports, quarterly member participant reports, and ad
2734 hoc reports requested by the department or state board.
2735 d. The cost-effectiveness and levels of the administrative
2736 services provided.
2737 e. The administrator’s ability to interact with the members
2738 participants, the employers, the state board, the division, and
2739 the providers; the means by which members participants may
2740 access account information, direct investment of contributions,
2741 make changes to their accounts, transfer moneys between
2742 available investment vehicles, and transfer moneys between
2743 investment products; and any fees that apply to such activities.
2744 f. Any other factor deemed necessary by the Trustees of the
2745 state board of Administration.
2746 2. In evaluating and selecting an educational provider, the
2747 state board shall establish criteria under which it shall
2748 consider the relative capabilities and qualifications of each
2749 proposed educational provider. In developing such criteria, the
2750 board shall consider:
2751 a. Demonstrated experience in providing educational
2752 services to public or private sector retirement systems.
2753 b. Ability and willingness to coordinate its activities
2754 with the Florida Retirement System employers, the state board,
2755 and the division, and to supply to such employers, the board,
2756 and the division the information and data they require,
2757 including, but not limited to, reports on educational contacts.
2758 c. The cost-effectiveness and levels of the educational
2759 services provided.
2760 d. Ability to provide educational services via different
2761 media, including, but not limited to, the Internet, personal
2762 contact, seminars, brochures, and newsletters.
2763 e. Any other factor deemed necessary by the Trustees of the
2764 state board of Administration.
2765 3. The establishment of the criteria shall be solely within
2766 the discretion of the state board.
2767 (d) The state board shall develop the form and content of
2768 any contracts to be offered under the investment plan Public
2769 Employee Optional Retirement Program. In developing the its
2770 contracts, the board shall must consider:
2771 1. The nature and extent of the rights and benefits to be
2772 afforded in relation to the required contributions required
2773 under the plan program.
2774 2. The suitability of the rights and benefits provided to
2775 be afforded and the interests of employers in the recruitment
2776 and retention of eligible employees.
2777 (e)1. The state board may contract with any consultant for
2778 professional services, including legal, consulting, accounting,
2779 and actuarial services, deemed necessary to implement and
2780 administer the investment plan optional program by the Trustees
2781 of the state board of Administration. The board may enter into a
2782 contract with one or more vendors to provide low-cost investment
2783 advice to members participants, supplemental to education
2784 provided by the third-party administrator. All fees under any
2785 such contract shall be paid by those members participants who
2786 choose to use the services of the vendor.
2787 2. The department may contract with consultants for
2788 professional services, including legal, consulting, accounting,
2789 and actuarial services, deemed necessary to implement and
2790 administer the investment plan optional program in coordination
2791 with the pension plan defined benefit program of the Florida
2792 Retirement System. The department, in coordination with the
2793 state board, may enter into a contract with the third-party
2794 administrator in order to coordinate services common to the
2795 various programs within the Florida Retirement System.
2796 (f) The third-party administrator may shall not receive
2797 direct or indirect compensation from an approved provider,
2798 except as specifically provided for in the contract with the
2799 state board.
2800 (g) The state board shall receive and resolve member
2801 participant complaints against the investment plan program, the
2802 third-party administrator, or any plan program vendor or
2803 provider; shall resolve any conflict between the third-party
2804 administrator and an approved provider if such conflict
2805 threatens the implementation or administration of the plan
2806 program or the quality of services to employees; and may resolve
2807 any other conflicts. The third-party administrator shall retain
2808 all member participant records for at least 5 years for use in
2809 resolving any member participant conflicts. The state board, the
2810 third-party administrator, or a provider is not required to
2811 produce documentation or an audio recording to justify action
2812 taken with regard to a member participant if the action occurred
2813 5 or more years before the complaint is submitted to the state
2814 board. It is presumed that all action taken 5 or more years
2815 before the complaint is submitted was taken at the request of
2816 the member participant and with the member’s participant’s full
2817 knowledge and consent. To overcome this presumption, the member
2818 participant must present documentary evidence or an audio
2819 recording demonstrating otherwise.
2820 (9) INVESTMENT OPTIONS OR PRODUCTS; PERFORMANCE REVIEW.—
2821 (a) The state board shall develop policy and procedures for
2822 selecting, evaluating, and monitoring the performance of
2823 approved providers and investment products to which employees
2824 may direct retirement contributions under the investment plan
2825 program. In accordance with such policy and procedures, the
2826 state board shall designate and contract for a number of
2827 investment products as determined by the board. The board shall
2828 also select one or more bundled providers, each of which whom
2829 may offer multiple investment options and related services, if
2830 when such an approach is determined by the board to provide
2831 afford value to the members participants otherwise not available
2832 through individual investment products. Each approved bundled
2833 provider may offer investment options that provide members
2834 participants with the opportunity to invest in each of the
2835 following asset classes, to be composed of individual options
2836 that represent either a single asset class or a combination
2837 thereof: money markets, United States fixed income, United
2838 States equities, and foreign stock. The state board shall review
2839 and manage all educational materials, contract terms, fee
2840 schedules, and other aspects of the approved provider
2841 relationships to ensure that no provider is unduly favored or
2842 penalized by virtue of its status within the investment plan.
2843 (b) The state board shall consider investment options or
2844 products it considers appropriate to give members participants
2845 the opportunity to accumulate retirement benefits, subject to
2846 the following:
2847 1. The investment plan Public Employee Optional Retirement
2848 Program must offer a diversified mix of low-cost investment
2849 products that span the risk-return spectrum and may include a
2850 guaranteed account as well as investment products, such as
2851 individually allocated guaranteed and variable annuities, which
2852 meet the requirements of this subsection and combine the ability
2853 to accumulate investment returns with the option of receiving
2854 lifetime income consistent with the long-term retirement
2855 security of a pension plan and similar to the lifetime-income
2856 benefit provided by the Florida Retirement System.
2857 2. Investment options or products offered by the group of
2858 approved providers may include mutual funds, group annuity
2859 contracts, individual retirement annuities, interests in trusts,
2860 collective trusts, separate accounts, and other such financial
2861 instruments, and may include products that give members
2862 participants the option of committing their contributions for an
2863 extended time period in an effort to obtain returns higher than
2864 those that could be obtained from investment products offering
2865 full liquidity.
2866 3. The state board may shall not contract with a any
2867 provider that imposes a front-end, back-end, contingent, or
2868 deferred sales charge, or any other fee that limits or restricts
2869 the ability of members participants to select any investment
2870 product available in the investment plan optional program. This
2871 prohibition does not apply to fees or charges that are imposed
2872 on withdrawals from products that give members participants the
2873 option of committing their contributions for an extended time
2874 period in an effort to obtain returns higher than those that
2875 could be obtained from investment products offering full
2876 liquidity, provided that the product in question, net of all
2877 fees and charges, produces material benefits relative to other
2878 comparable products in the plan program offering full liquidity.
2879 4. Fees or charges for insurance features, such as
2880 mortality and expense-risk charges, must be reasonable relative
2881 to the benefits provided.
2882 (c) In evaluating and selecting approved providers and
2883 products, the state board shall establish criteria for
2884 evaluating under which it shall consider the relative
2885 capabilities and qualifications of each proposed provider
2886 company and product. In developing such criteria, the board
2887 shall consider the following to the extent such factors may be
2888 applied in connection with investment products, services, or
2889 providers:
2890 1. Experience in the United States providing retirement
2891 products and related financial services under investment defined
2892 contribution retirement plans.
2893 2. Financial strength and stability as which shall be
2894 evidenced by the highest ratings assigned by nationally
2895 recognized rating services when comparing proposed providers
2896 that are so rated.
2897 3. Intrastate and interstate portability of the product
2898 offered, including early withdrawal options.
2899 4. Compliance with the Internal Revenue Code.
2900 5. The cost-effectiveness of the product provided and the
2901 levels of service supporting the product relative to its
2902 benefits and its characteristics, including, without limitation,
2903 the level of risk borne by the provider.
2904 6. The provider company’s ability and willingness to
2905 coordinate its activities with Florida Retirement System
2906 employers, the department, and the state board, and to supply to
2907 the such employers, the department, and the board with the
2908 information and data they require.
2909 7. The methods available to members participants to
2910 interact with the provider company; the means by which members
2911 participants may access account information, direct investment
2912 of contributions, make changes to their accounts, transfer
2913 moneys between available investment vehicles, and transfer
2914 moneys between provider companies; and any fees that apply to
2915 such activities.
2916 8. The provider company’s policies with respect to the
2917 transfer of individual account balances, contributions, and
2918 earnings thereon, both internally among investment products
2919 offered by the provider company and externally between approved
2920 providers, as well as any fees, charges, reductions, or
2921 penalties that may be applied.
2922 9. An evaluation of specific investment products, taking
2923 into account each product’s experience in meeting its investment
2924 return objectives net of all related fees, expenses, and
2925 charges, including, but not limited to, investment management
2926 fees, loads, distribution and marketing fees, custody fees,
2927 recordkeeping fees, education fees, annuity expenses, and
2928 consulting fees.
2929 10. Organizational factors, including, but not limited to,
2930 financial solvency, organizational depth, and experience in
2931 providing institutional and retail investment services.
2932 (d) By March 1, 2010, The state board shall identify and
2933 offer at least one terror-free investment product that allocates
2934 its funds among securities not subject to divestiture as
2935 provided in s. 215.473 if the investment product is deemed by
2936 the board to be consistent with prudent investor standards. No
2937 person may bring a civil, criminal, or administrative action
2938 against an approved provider; the state board; or any employee,
2939 officer, director, or trustee of such provider based upon the
2940 divestiture of any security or the offering of a terror-free
2941 investment product as specified in this paragraph.
2942 (e) As a condition of offering an any investment option or
2943 product in the investment plan optional retirement program, the
2944 approved provider must agree to make the investment product or
2945 service available under the most beneficial terms offered to any
2946 other customer, subject to approval by the Trustees of the state
2947 board of Administration.
2948 (f) The state board shall regularly review the performance
2949 of each approved provider and product and related organizational
2950 factors to ensure continued compliance with established
2951 selection criteria and with board policy and procedures.
2952 Providers and products may be terminated subject to contract
2953 provisions. The state board shall adopt procedures to transfer
2954 account balances from terminated products or providers to other
2955 products or providers in the investment plan optional program.
2956 (g)1. An approved provider shall comply with all applicable
2957 federal and state securities and insurance laws and regulations
2958 applicable to the provider, as well as with the applicable rules
2959 and guidelines of the National Association of Securities Dealers
2960 which govern the ethical marketing of investment products. In
2961 furtherance of this mandate, an approved provider must agree in
2962 its contract with the state board to establish and maintain a
2963 compliance education and monitoring system to supervise the
2964 activities of all personnel who directly communicate with
2965 individual members participants and recommend investment
2966 products, which system is consistent with rules of the National
2967 Association of Securities Dealers.
2968 2. Approved provider personnel who directly communicate
2969 with individual members participants and who recommend
2970 investment products shall make an independent and unbiased
2971 determination as to whether an investment product is suitable
2972 for a particular member participant.
2973 3. The state board shall develop procedures to receive and
2974 resolve member participant complaints against a provider or
2975 approved provider personnel, and, if when appropriate, refer
2976 such complaints to the appropriate agency.
2977 4. Approved providers may not sell or in any way distribute
2978 any customer list or member participant identification
2979 information generated through their offering of products or
2980 services through the investment plan optional retirement
2981 program.
2982 (10) EDUCATION COMPONENT.—
2983 (a) The state board, in coordination with the department,
2984 shall provide for an education component for eligible employees
2985 system members in a manner consistent with the provisions of
2986 this section. The education component must be available to
2987 eligible employees at least 90 days before prior to the
2988 beginning date of the election period for the employees of the
2989 respective types of employers.
2990 (b) The education component must provide eligible employees
2991 system members with impartial and balanced information about
2992 plan choices. The education component must involve multimedia
2993 formats. Plan Program comparisons must, to the greatest extent
2994 possible, be based upon the retirement income that different
2995 retirement programs may provide to the member participant. The
2996 state board shall monitor the performance of the contract for
2997 the education component to ensure that the program is conducted
2998 in accordance with the contract, applicable law, and the rules
2999 of the board.
3000 (c) The state board, in coordination with the department,
3001 shall provide for an initial and ongoing transfer education
3002 component to provide system members with information necessary
3003 to make informed plan choice decisions. The transfer education
3004 component must include, but is not limited to, information on:
3005 1. The amount of money available to a member to transfer to
3006 the investment plan defined contribution program.
3007 2. The features of and differences between the pension plan
3008 defined benefit program and the investment plan defined
3009 contribution program, both generally and specifically, as those
3010 differences may affect the member.
3011 3. The expected benefit available if the member were to
3012 retire under each of the retirement programs, based on
3013 appropriate alternative sets of assumptions.
3014 4. The rate of return from investments in the investment
3015 plan defined contribution program and the period of time over
3016 which such rate of return must be achieved to equal or exceed
3017 the expected monthly benefit payable to the member under the
3018 pension plan defined benefit program.
3019 5. The historical rates of return for the investment
3020 alternatives available in the investment plan defined
3021 contribution programs.
3022 6. The benefits and historical rates of return on
3023 investments available in a typical deferred compensation plan or
3024 a typical plan under s. 403(b) of the Internal Revenue Code for
3025 which the employee may be eligible.
3026 7. The program choices available to employees of the State
3027 University System and the comparative benefits of each available
3028 program, if applicable.
3029 8. Payout options available in each of the retirement
3030 programs.
3031 (d) An ongoing education and communication component must
3032 provide eligible employees system members with information
3033 necessary to make informed decisions about choices within their
3034 retirement program of membership and in preparation for
3035 retirement. The component must include, but is not limited to,
3036 information concerning:
3037 1. Rights and conditions of membership.
3038 2. Benefit features within the program, options, and
3039 effects of certain decisions.
3040 3. Coordination of contributions and benefits with a
3041 deferred compensation plan under s. 457 or a plan under s.
3042 403(b) of the Internal Revenue Code.
3043 4. Significant program changes.
3044 5. Contribution rates and program funding status.
3045 6. Planning for retirement.
3046 (e) Descriptive materials must be prepared under the
3047 assumption that the employee is an unsophisticated investor, and
3048 all materials used in the education component must be approved
3049 by the state board before prior to dissemination.
3050 (f) The state board and the department shall also establish
3051 a communication component to provide program information to
3052 participating employers and the employers’ personnel and payroll
3053 officers and to explain their respective responsibilities in
3054 conjunction with the retirement programs.
3055 (g) Funding for education of new employees may reflect
3056 administrative costs to the investment plan optional program and
3057 the pension plan defined benefit program.
3058 (h) Pursuant to paragraph (8)(a), all Florida Retirement
3059 System employers have an obligation to regularly communicate the
3060 existence of the two Florida Retirement System plans and the
3061 plan choice in the natural course of administering their
3062 personnel functions, using the educational materials supplied by
3063 the state board and the department of Management Services.
3064 (11) MEMBER PARTICIPANT INFORMATION REQUIREMENTS.—The state
3065 board shall ensure that each member participant is provided a
3066 quarterly statement that accounts for employer and employee the
3067 contributions made on behalf of the member such participant; the
3068 interest and investment earnings thereon; and any fees,
3069 penalties, or other deductions that apply thereto. At a minimum,
3070 such statements must:
3071 (a) Indicate the member’s participant’s investment options.
3072 (b) State the market value of the account at the close of
3073 the current quarter and previous quarter.
3074 (c) Show account gains and losses for the period and
3075 changes in account accumulation unit values for the quarter
3076 period.
3077 (d) Itemize account contributions for the quarter.
3078 (e) Indicate any account changes due to adjustment of
3079 contribution levels, reallocation of contributions, balance
3080 transfers, or withdrawals.
3081 (f) Set forth any fees, charges, penalties, and deductions
3082 that apply to the account.
3083 (g) Indicate the amount of the account in which the member
3084 participant is fully vested and the amount of the account in
3085 which the member participant is not vested.
3086 (h) Indicate each investment product’s performance relative
3087 to an appropriate market benchmark.
3088
3089 The third-party administrator shall provide quarterly and annual
3090 summary reports to the state board and any other reports
3091 requested by the department or the board. In any solicitation or
3092 offer of coverage under the investment plan an optional
3093 retirement program, a provider company shall be governed by the
3094 contract readability provisions of s. 627.4145, notwithstanding
3095 s. 627.4145(6)(c). In addition, all descriptive materials must
3096 be prepared under the assumption that the member participant is
3097 an unsophisticated investor. Provider companies must maintain an
3098 internal system of quality assurance, have proven functional
3099 systems that are date-calculation compliant, and be subject to a
3100 due-diligence inquiry that proves their capacity and fitness to
3101 undertake service responsibilities.
3102 (12) ADVISORY COUNCIL TO PROVIDE ADVICE AND ASSISTANCE.—The
3103 Investment Advisory Council, created pursuant to s. 215.444,
3104 shall assist the state board in implementing and administering
3105 the investment plan Public Employee Optional Retirement Program.
3106 The Investment Advisory council, created pursuant to s. 215.444,
3107 shall review the state board’s initial recommendations regarding
3108 the criteria to be used in selecting and evaluating approved
3109 providers and investment products. The council may provide
3110 comments on the recommendations to the board within 45 days
3111 after receiving the initial recommendations. The state board
3112 shall make the final determination as to whether any investment
3113 provider or product, any contractor, or any and all contract
3114 provisions are shall be approved for the investment plan
3115 program.
3116 (13) FEDERAL REQUIREMENTS.—
3117 (a) Provisions of This section shall be construed, and the
3118 investment plan Public Employee Optional Retirement Program
3119 shall be administered, so as to comply with the Internal Revenue
3120 Code, 26 U.S.C., and specifically with plan qualification
3121 requirements imposed on governmental plans under s. 401(a) of
3122 the Internal Revenue Code. The state board may shall have the
3123 power and authority to adopt rules reasonably necessary to
3124 establish or maintain the qualified status of the investment
3125 plan Optional Retirement Program under the Internal Revenue Code
3126 and to implement and administer the plan Optional Retirement
3127 Program in compliance with the Internal Revenue Code and this
3128 part; provided however, that the board may shall not have the
3129 authority to adopt any rule which makes a substantive change to
3130 the investment plan Optional Retirement Program as designed by
3131 this part.
3132 (b) Any section or provision of this chapter which is
3133 susceptible to more than one construction shall must be
3134 interpreted in favor of the construction most likely to satisfy
3135 requirements imposed by s. 401(a) of the Internal Revenue Code.
3136 (c) Employer and employee contributions payable under this
3137 section for any limitation year may not exceed the maximum
3138 amount allowable for qualified defined contribution pension
3139 plans under applicable provisions of the Internal Revenue Code.
3140 If an employee who is enrolled who has elected to participate in
3141 the investment plan enrolls Public Employee Optional Retirement
3142 Program participates in any other plan that is maintained by the
3143 participating employer, benefits that accrue under the
3144 investment plan are Public Employee Optional Retirement Program
3145 shall be considered primary for any aggregate limitation
3146 applicable under s. 415 of the Internal Revenue Code.
3147 (14) INVESTMENT POLICY STATEMENT.—
3148 (a) Investment products and approved providers selected for
3149 the investment plan Public Employee Optional Retirement Program
3150 must shall conform with the Florida Public Employee Optional
3151 Retirement System Program Investment Plan Policy Statement,
3152 herein referred to as the “statement,” as developed and approved
3153 by the Trustees of the state board of Administration. The
3154 statement must include, among other items, the investment
3155 objectives of the investment plan Public Employee Optional
3156 Retirement Program, manager selection and monitoring guidelines,
3157 and performance measurement criteria. As required from time to
3158 time, the executive director of the state board may present
3159 recommended changes in the statement to the board for approval.
3160 (b) Before Prior to presenting the statement, or any
3161 recommended changes thereto, to the state board, the executive
3162 director of the board shall present such statement or changes to
3163 the Investment Advisory Council for review. The council shall
3164 present the results of its review to the board prior to the
3165 board’s final approval of the statement or changes in the
3166 statement.
3167 (15) STATEMENT OF FIDUCIARY STANDARDS AND
3168 RESPONSIBILITIES.—
3169 (a) Investment of investment plan optional defined
3170 contribution retirement plan assets shall be made for the sole
3171 interest and exclusive purpose of providing benefits to plan
3172 members participants and beneficiaries and defraying reasonable
3173 expenses of administering the plan. The program’s assets shall
3174 are to be invested, on behalf of the members program
3175 participants, with the care, skill, and diligence that a prudent
3176 person acting in a like manner would undertake. The performance
3177 of the investment duties set forth in this paragraph shall
3178 comply with the fiduciary standards set forth in the Employee
3179 Retirement Income Security Act of 1974 at 29 U.S.C. s.
3180 1104(a)(1)(A)-(C). In case of conflict with other provisions of
3181 law authorizing investments, the investment and fiduciary
3182 standards set forth in this subsection shall prevail.
3183 (b) If a member participant or beneficiary of the
3184 investment plan Public Employee Optional Retirement program
3185 exercises control over the assets in his or her account, as
3186 determined by reference to regulations of the United States
3187 Department of Labor under s. 404(c) of the Employee Retirement
3188 Income Security Act of 1974 and all applicable laws governing
3189 the operation of the program, a no program fiduciary is not
3190 shall be liable for any loss to a member’s participant’s or
3191 beneficiary’s account which results from the member’s such
3192 participant’s or beneficiary’s exercise of control.
3193 (c) Subparagraph (8)(b)2. (8)(b)4. and paragraph (15)(b)
3194 incorporate the federal law concept of member participant
3195 control, established by regulations of the United States
3196 Department of Labor under s. 404(c) of the Employee Retirement
3197 Income Security Act of 1974 (ERISA). The purpose of this
3198 paragraph is to assist employers and the state board of
3199 Administration in maintaining compliance with s. 404(c), while
3200 avoiding unnecessary costs and eroding member participant
3201 benefits under the investment plan Public Employee Optional
3202 Retirement program. Pursuant to 29 C.F.R. s. 2550.404c
3203 1(b)(2)(i)(B)(1)(viii), the state board of Administration or its
3204 designated agents shall deliver to members participants of the
3205 investment plan Public Employee Optional Retirement program a
3206 copy of the prospectus most recently provided to the plan, and,
3207 pursuant to 29 C.F.R. s. 2550.404c-1(b)(2)(i)(B)(2)(ii), shall
3208 provide such members participants an opportunity to obtain this
3209 information, except that:
3210 1. The requirement to deliver a prospectus shall be deemed
3211 to be satisfied by delivery of a fund profile or summary profile
3212 that contains the information that would be included in a
3213 summary prospectus as described by Rule 498 under the Securities
3214 Act of 1933, 17 C.F.R. s. 230.498. If When the transaction fees,
3215 expense information, or other information provided by a mutual
3216 fund in the prospectus does not reflect terms negotiated by the
3217 state board of Administration or its designated agents, the
3218 aforementioned requirement is deemed to be satisfied by delivery
3219 of a separate document described by Rule 498 substituting
3220 accurate information; and
3221 2. Delivery shall be deemed to have been effected if
3222 delivery is through electronic means and the following standards
3223 are satisfied:
3224 a. Electronically-delivered documents are prepared and
3225 provided consistent with style, format, and content requirements
3226 applicable to printed documents;
3227 b. Each member participant is provided timely and adequate
3228 notice of the documents that are to be delivered and their
3229 significance thereof, and of the member’s participant’s right to
3230 obtain a paper copy of such documents free of charge;
3231 c.(I) Members Participants have adequate access to the
3232 electronic documents, at locations such as their worksites or
3233 public facilities, and have the ability to convert the documents
3234 to paper free of charge by the state board of Administration,
3235 and the board or its designated agents take appropriate and
3236 reasonable measures to ensure that the system for furnishing
3237 electronic documents results in actual receipt., or
3238 (II) Members Participants have provided consent to receive
3239 information in electronic format, which consent may be revoked;
3240 and
3241 d. The state board of Administration, or its designated
3242 agent, actually provides paper copies of the documents free of
3243 charge, upon request.
3244 (16) DISABILITY BENEFITS.—For any member participant of the
3245 investment plan optional retirement program who becomes totally
3246 and permanently disabled, benefits must shall be paid in
3247 accordance with the provisions of s. 121.591.
3248 (17) SOCIAL SECURITY COVERAGE.—Social security coverage
3249 shall be provided for all officers and employees who become
3250 members participants of the investment plan optional program.
3251 Any modification of the present agreement with the Social
3252 Security Administration, or referendum required under the Social
3253 Security Act, for the purpose of providing social security
3254 coverage for any member shall be requested by the state agency
3255 in compliance with the applicable provisions of the Social
3256 Security Act governing such coverage. However, retroactive
3257 social security coverage for service before prior to December 1,
3258 1970, with the employer may shall not be provided for any member
3259 who was not covered under the agreement as of November 30, 1970.
3260 (18) RETIREE HEALTH INSURANCE SUBSIDY.—All officers and
3261 employees who are members participants of the investment plan
3262 are optional program shall be eligible to receive the retiree
3263 health insurance subsidy, subject to the provisions of s.
3264 112.363.
3265 (19) MEMBER PARTICIPANT RECORDS.—Personal identifying
3266 information of a member of participant in the investment plan
3267 Public Employee Optional Retirement Program contained in Florida
3268 Retirement System records held by the state board of
3269 Administration or the department of Management Services is
3270 exempt from s. 119.07(1) and s. 24(a), Art. I of the State
3271 Constitution.
3272 (20) DESIGNATION OF BENEFICIARIES.—
3273 (a) Each member participant may, on a form provided for
3274 that purpose, signed and filed with the third-party
3275 administrator, designate a choice of one or more persons, named
3276 sequentially or jointly, as his or her beneficiary for receiving
3277 who shall receive the benefits, if any, which may be payable
3278 pursuant to this chapter in the event of the member’s
3279 participant’s death. If no beneficiary is named in this manner,
3280 or if no beneficiary designated by the member participant
3281 survives the member participant, the beneficiary shall be the
3282 spouse of the deceased, if living. If the member’s participant’s
3283 spouse is not alive at the time of the beneficiary’s his or her
3284 death, the beneficiary shall be the member’s living children of
3285 the participant. If no children survive, the beneficiary shall
3286 be the member’s participant’s father or mother, if living;
3287 otherwise, the beneficiary shall be the member’s participant’s
3288 estate. The beneficiary most recently designated by a member
3289 participant on a form or letter filed with the third-party
3290 administrator shall be the beneficiary entitled to any benefits
3291 payable at the time of the member’s participant’s death. However
3292 Notwithstanding any other provision in this subsection to the
3293 contrary, if a member for a participant who dies before prior to
3294 his or her effective date of retirement, the spouse at the time
3295 of death shall be the member’s participant’s beneficiary unless
3296 the member such participant designates a different beneficiary
3297 as provided in this subsection subsequent to the member’s
3298 participant’s most recent marriage.
3299 (b) If a member participant designates a primary
3300 beneficiary other than the member’s participant’s spouse, the
3301 member’s participant’s spouse must sign the beneficiary
3302 designation form to acknowledge the designation. This
3303 requirement does not apply to the designation of one or more
3304 contingent beneficiaries to receive benefits remaining upon the
3305 death of the primary beneficiary or beneficiaries.
3306 (c) Notwithstanding the member’s participant’s designation
3307 of benefits to be paid through a trust to a beneficiary that is
3308 a natural person, and notwithstanding the provisions of the
3309 trust, benefits must shall be paid directly to the beneficiary
3310 if the person is no longer a minor or an incapacitated person as
3311 defined in s. 744.102.
3312 (21) PARTICIPATION BY TERMINATED DEFERRED RETIREMENT OPTION
3313 PROGRAM PARTICIPANTS.—Notwithstanding any other provision of law
3314 to the contrary, participants in the Deferred Retirement Option
3315 Program offered under part I may, after conclusion of their
3316 participation in the program, elect to roll over or authorize a
3317 direct trustee-to-trustee transfer to an account under the
3318 investment plan Public Employee Optional Retirement Program of
3319 their Deferred Retirement Option Program proceeds distributed as
3320 provided under s. 121.091(13)(c)5. The transaction must
3321 constitute an “eligible rollover distribution” within the
3322 meaning of s. 402(c)(4) of the Internal Revenue Code.
3323 (a) The investment plan Public Employee Optional Retirement
3324 Program may accept such amounts for deposit into member
3325 participant accounts as provided in paragraph (5)(e) (5)(c).
3326 (b) The affected participant shall direct the investment of
3327 his or her investment account; however, unless he or she becomes
3328 a renewed member of the Florida Retirement System under s.
3329 121.122 and elects to enroll participate in the investment plan
3330 Public Employee Optional Retirement program, employer and
3331 employee contributions may not be made to the participant’s
3332 account as provided under paragraph (5)(a).
3333 (c) The state board or the department is not responsible
3334 for locating those persons who may be eligible to enroll
3335 participate in the investment plan Public Employee Optional
3336 Retirement Program under this subsection.
3337 (22) CREDIT FOR MILITARY SERVICE.—Creditable service of any
3338 member of the investment program includes Public Employee
3339 Optional Retirement Program shall include military service in
3340 the Armed Forces of the United States as provided in the
3341 conditions outlined in s. 121.111(1).
3342 Section 22. Section 121.4502, Florida Statutes, is amended
3343 to read:
3344 121.4502 Florida Public Employee Optional Retirement System
3345 Investment Plan Program Trust Fund.—
3346 (1) The Florida Public Employee Optional Retirement System
3347 Investment Plan Program Trust Fund is created to hold the assets
3348 of the Florida Public Employee Optional Retirement System
3349 Investment Plan Program in trust for the exclusive benefit of
3350 plan members such program’s participants and beneficiaries, and
3351 for the payment of reasonable administrative expenses of the
3352 plan program, in accordance with s. 401 of the Internal Revenue
3353 Code, and shall be administered by the State Board of
3354 Administration as trustee. Funds shall be credited to the trust
3355 fund as provided in this part and, to be used for the purposes
3356 of this part. The trust fund is exempt from the service charges
3357 imposed by s. 215.20.
3358 (2) The Florida Public Employee Optional Retirement System
3359 Investment Plan Program Trust Fund is a retirement trust fund of
3360 the Florida Retirement System that accounts for retirement plan
3361 assets held by the state in a trustee capacity as a fiduciary
3362 for individual members participants in the Florida Public
3363 Employee Optional Retirement System Investment Plan Program and,
3364 pursuant to s. 19(f), Art. III of the State Constitution, is not
3365 subject to termination.
3366 Section 23. Subsections (1) and (3) of section 121.4503,
3367 Florida Statutes, are amended to read:
3368 121.4503 Florida Retirement System Contributions Clearing
3369 Trust Fund.—
3370 (1) The Florida Retirement System Contributions Clearing
3371 Trust Fund is created as a clearing fund for disbursing employer
3372 and employee contributions to the component plans of the Florida
3373 Retirement System and shall be administered by the department of
3374 Management Services. Funds shall be credited to the trust fund
3375 as provided in this chapter and shall be held in trust for the
3376 contributing employers and employees until such time as the
3377 assets are transferred by the department to the Florida
3378 Retirement System Trust Fund, the Florida Public Employee
3379 Optional Retirement System Investment Plan Program Trust Fund,
3380 or other trust funds as authorized by law, to be used for the
3381 purposes of this chapter. The trust fund is exempt from the
3382 service charges imposed by s. 215.20.
3383 (3) The department of Management Services may adopt rules
3384 governing the receipt and disbursement of amounts received by
3385 the Florida Retirement System Contributions Clearing Trust Fund
3386 from employers and employees contributing to the component plans
3387 of the Florida Retirement System.
3388 Section 24. Section 121.571, Florida Statutes, is amended
3389 to read:
3390 121.571 Contributions.—Contributions to the Florida Public
3391 Employee Optional Retirement System Investment Plan Program
3392 shall be made as follows:
3393 (1) CONTRIBUTORY NONCONTRIBUTORY PLAN.—Each employer and
3394 employee shall submit accomplish the contributions as required
3395 under by s. 121.71 by a procedure in which no employee’s gross
3396 salary shall be reduced.
3397 (2) CONTRIBUTION RATES GENERALLY.—Contributions to fund the
3398 retirement and disability benefits provided under this part must
3399 shall be based on the uniform contribution rates established by
3400 s. 121.71 and on the membership class or subclass of the
3401 employee participant. Such contributions must shall be allocated
3402 as provided in ss. 121.72 and 121.73.
3403 (3) CONTRIBUTIONS FOR SOCIAL SECURITY COVERAGE AND FOR
3404 RETIREE HEALTH INSURANCE SUBSIDY.—Contributions required under
3405 s. 121.71 are this section shall be in addition to employer and
3406 member contributions required for social security and the
3407 Retiree Health Insurance Subsidy Trust Fund as required under
3408 provided in ss. 112.363, 121.052, 121.055, and 121.071, as
3409 appropriate.
3410 Section 25. Section 121.591, Florida Statutes, is amended
3411 to read:
3412 121.591 Payment of benefits payable under the Public
3413 Employee Optional Retirement Program of the Florida Retirement
3414 System.—Benefits may not be paid under the Florida Retirement
3415 System Investment Plan this section unless the member has
3416 terminated employment as provided in s. 121.021(39)(a) or is
3417 deceased and a proper application has been filed as in the
3418 manner prescribed by the state board or the department. The
3419 state board or department, as appropriate, may cancel an
3420 application for retirement benefits if when the member or
3421 beneficiary fails to timely provide the information and
3422 documents required by this chapter and the rules of the state
3423 board and department. In accordance with their respective
3424 responsibilities as provided herein, the state board of
3425 Administration and the department of Management Services shall
3426 adopt rules establishing procedures for application for
3427 retirement benefits and for the cancellation of such application
3428 if when the required information or documents are not received.
3429 The state board of Administration and the department of
3430 Management Services, as appropriate, are authorized to cash out
3431 a de minimis account of not more than $5,000 of a member
3432 participant who has been terminated from Florida Retirement
3433 System covered employment for a minimum of 6 calendar months. A
3434 de minimis account is an account containing employer
3435 contributions and accumulated earnings of not more than $5,000
3436 made under the provisions of this chapter. Such cash-out must
3437 either be a complete lump-sum liquidation of the account
3438 balance, subject to the provisions of the Internal Revenue Code,
3439 or a lump-sum direct rollover distribution paid directly to the
3440 custodian of an eligible retirement plan, as defined by the
3441 Internal Revenue Code, on behalf of the member participant. Any
3442 nonvested accumulations, including amounts transferred to the
3443 suspense account of the Florida Retirement System Investment
3444 Plan Trust Fund, are forfeited upon payment of any vested
3445 benefit to a member or beneficiary, except for de minimis
3446 distributions or minimum required distributions as provided
3447 under this section. If any financial instrument issued for the
3448 payment of retirement benefits under this section is not
3449 presented for payment within 180 days after the last day of the
3450 month in which it was originally issued, the third-party
3451 administrator or other duly authorized agent of the state board
3452 of Administration shall cancel the instrument and credit the
3453 amount of the instrument to the suspense account of the Florida
3454 Public Employee Optional Retirement System Investment Plan
3455 Program Trust Fund authorized under s. 121.4501(6). Any such
3456 amounts transferred to the suspense account are payable upon a
3457 proper application, not to include earnings thereon, as provided
3458 in this section, within 10 years after the last day of the month
3459 in which the instrument was originally issued, after which time
3460 such amounts and any earnings attributable to employer
3461 contributions are thereon shall be forfeited. Any such forfeited
3462 amounts are assets of the Public Employee Optional Retirement
3463 Program trust fund and are not subject to the provisions of
3464 chapter 717.
3465 (1) NORMAL BENEFITS.—Under the Florida Public Employee
3466 Optional Retirement System Investment Plan Program:
3467 (a) Benefits in the form of vested accumulations as
3468 described in s. 121.4501(6) are payable under this subsection in
3469 accordance with the following terms and conditions:
3470 1. To the extent vested, Benefits are payable only to a
3471 member, alternate payee or a qualified domestic relations order,
3472 or a beneficiary participant.
3473 2. Benefits shall be paid by the third-party administrator
3474 or designated approved providers in accordance with the law, the
3475 contracts, and any applicable board rule or policy.
3476 3. To receive benefits, The member participant must be
3477 terminated from all employment with all Florida Retirement
3478 System employers, as provided in s. 121.021(39).
3479 4. Benefit payments may not be made until the member
3480 participant has been terminated for 3 calendar months, except
3481 that the state board may authorize by rule for the distribution
3482 of up to 10 percent of the member’s participant’s account after
3483 being terminated for 1 calendar month if the member participant
3484 has reached the normal retirement date as defined in s. 121.021
3485 of the defined benefit plan.
3486 5. If a member or former member of the Florida Retirement
3487 System receives an invalid distribution from the Public Employee
3488 Optional Retirement Program Trust Fund, such person must repay
3489 the full amount invalid distribution to the trust fund within 90
3490 days after receipt of final notification by the state board or
3491 the third-party administrator that the distribution was invalid,
3492 or, in lieu of repayment, must terminate employment from all
3493 participating employers. If such person fails to repay the full
3494 invalid distribution within 90 days after receipt of final
3495 notification, the person may be deemed retired from the
3496 investment plan optional retirement program by the state board,
3497 as provided pursuant to s. 121.4501(2)(k), and is subject to s.
3498 121.122. If such person is deemed retired by the state board,
3499 any joint and several liability set out in s. 121.091(9)(d)2. is
3500 becomes null and void, and the state board, the department, or
3501 the employing agency is not liable for gains on payroll
3502 contributions that have not been deposited to the person’s
3503 account in the investment plan retirement program, pending
3504 resolution of the invalid distribution. The member or former
3505 member who has been deemed retired or who has been determined by
3506 the state board to have taken an invalid distribution may appeal
3507 the agency decision through the complaint process as provided
3508 under s. 121.4501(9)(g)3. As used in this subparagraph, the term
3509 “invalid distribution” means any distribution from an account in
3510 the investment plan optional retirement program which is taken
3511 in violation of this section, s. 121.091(9), or s. 121.4501.
3512 (b) If a member participant elects to receive his or her
3513 benefits upon termination of employment as defined in s.
3514 121.021, the member participant must submit a written
3515 application or an application by electronic means to the third
3516 party administrator indicating his or her preferred distribution
3517 date and selecting an authorized method of distribution as
3518 provided in paragraph (c). The member participant may defer
3519 receipt of benefits until he or she chooses to make such
3520 application, subject to federal requirements.
3521 (c) Upon receipt by the third-party administrator of a
3522 properly executed application for distribution of benefits, the
3523 total accumulated benefit is shall be payable to the member
3524 participant, as:
3525 1. A lump-sum or partial distribution to the member
3526 participant;
3527 2. A lump-sum direct rollover distribution whereby all
3528 accrued benefits, plus interest and investment earnings, are
3529 paid from the member’s participant’s account directly to the
3530 custodian of an eligible retirement plan, as defined in s.
3531 402(c)(8)(B) of the Internal Revenue Code, on behalf of the
3532 participant; or
3533 3. Periodic distributions, as authorized by the state
3534 board.
3535 (d) The distribution payment method selected by the plan
3536 member or beneficiary, and the retirement of the member or
3537 beneficiary, is final and irrevocable at the time a benefit
3538 distribution payment is cashed, deposited, or transferred to
3539 another financial institution. Any additional service that
3540 remains unclaimed at retirement may not be claimed or purchased,
3541 and the type of retirement may not be changed, except that if a
3542 member recovers from a disability, the member may subsequently
3543 request normal service benefits under subsection (2).
3544 (e) A member may not receive a distribution of employee
3545 contributions if a pending or approved qualified domestic
3546 relations order is filed against the member’s investment plan
3547 account.
3548 (2) DISABILITY RETIREMENT BENEFITS.—Benefits provided under
3549 this subsection are payable in lieu of the benefits that which
3550 would otherwise be payable under the provisions of subsection
3551 (1). Such benefits must shall be funded entirely from employer
3552 contributions made under s. 121.571, transferred employee
3553 contributions and participant funds accumulated pursuant to
3554 paragraph (a), and interest and earnings thereon. Pursuant
3555 thereto:
3556 (a) Transfer of funds.—To qualify for to receive monthly
3557 disability benefits under this subsection:
3558 1. All moneys accumulated in the member’s participant’s
3559 Public Employee Optional Retirement Program accounts, including
3560 vested and nonvested accumulations as described in s.
3561 121.4501(6), must shall be transferred from such individual
3562 accounts to the division of Retirement for deposit in the
3563 disability account of the Florida Retirement System Trust Fund.
3564 Such moneys must shall be separately accounted for separately.
3565 Earnings must shall be credited on an annual basis for amounts
3566 held in the disability accounts of the Florida Retirement System
3567 Trust Fund based on actual earnings of the Florida Retirement
3568 System trust fund.
3569 2. If the member participant has retained retirement credit
3570 he or she had earned under the pension plan defined benefit
3571 program of the Florida Retirement System as provided in s.
3572 121.4501(3) s. 121.4501(3)(b), a sum representing the actuarial
3573 present value of such credit within the Florida Retirement
3574 System Trust Fund shall be reassigned by the division of
3575 Retirement from the pension plan defined benefit program to the
3576 disability program as implemented under this subsection and
3577 shall be deposited in the disability account of the Florida
3578 Retirement System trust fund. Such moneys must shall be
3579 separately accounted for separately.
3580 (b) Disability retirement; entitlement.—
3581 1. A member participant of the investment plan Public
3582 Employee Optional Retirement program who becomes totally and
3583 permanently disabled, as defined in paragraph (d) s.
3584 121.091(4)(b), after completing 8 years of creditable service,
3585 or a member participant who becomes totally and permanently
3586 disabled in the line of duty regardless of his or her length of
3587 service, is shall be entitled to a monthly disability benefit as
3588 provided herein.
3589 2. In order for service to apply toward the 8 years of
3590 creditable service required to vest for regular disability
3591 benefits, or toward the creditable service used in calculating a
3592 service-based benefit as provided for under paragraph (g), the
3593 service must be creditable service as described below:
3594 a. The member’s participant’s period of service under the
3595 investment plan shall Public Employee Optional Retirement
3596 program will be considered creditable service, except as
3597 provided in subparagraph d.
3598 b. If the member participant has elected to retain credit
3599 for his or her service under the pension plan defined benefit
3600 program of the Florida Retirement System as provided under s.
3601 121.4501(3) s. 121.4501(3)(b), all such service shall will be
3602 considered creditable service.
3603 c. If the member elects participant has elected to transfer
3604 to his or her member participant accounts a sum representing the
3605 present value of his or her retirement credit under the pension
3606 plan defined benefit program as provided under s. 121.4501(3) s.
3607 121.4501(3)(c), the period of service under the pension plan
3608 defined benefit program represented in the present value amounts
3609 transferred shall will be considered creditable service for
3610 purposes of vesting for disability benefits, except as provided
3611 in subparagraph d.
3612 d. If a member Whenever a participant has terminated
3613 employment and has taken distribution of his or her funds as
3614 provided in subsection (1), all creditable service represented
3615 by such distributed funds is forfeited for purposes of this
3616 subsection.
3617 (c) Disability retirement effective date.—The effective
3618 retirement date for a member participant who applies and is
3619 approved for disability retirement shall be established as
3620 provided under s. 121.091(4)(a)2. and 3.
3621 (d) Total and permanent disability.—A member is participant
3622 shall be considered totally and permanently disabled if, in the
3623 opinion of the division, he or she is prevented, by reason of a
3624 medically determinable physical or mental impairment, from
3625 rendering useful and efficient service as an officer or
3626 employee.
3627 (e) Proof of disability.—The division, Before approving
3628 payment of any disability retirement benefit, the division shall
3629 require proof that the member participant is totally and
3630 permanently disabled in the same manner as provided for members
3631 of the defined benefit program of the Florida Retirement System
3632 under s. 121.091(4)(c).
3633 (f) Disability retirement benefit.—Upon the disability
3634 retirement of a member participant under this subsection, the
3635 member participant shall receive a monthly benefit that begins
3636 accruing shall begin to accrue on the first day of the month of
3637 disability retirement, as approved by the division, and is shall
3638 be payable on the last day of that month and each month
3639 thereafter during his or her lifetime and continued disability.
3640 All disability benefits must payable to such member shall be
3641 paid out of the disability account of the Florida Retirement
3642 System Trust Fund established under this subsection.
3643 (g) Computation of disability retirement benefit.—The
3644 amount of each monthly payment must shall be calculated in the
3645 same manner as provided for members of the defined benefit
3646 program of the Florida Retirement System under s. 121.091(4)(f).
3647 For such purpose, Creditable service under both the pension plan
3648 defined benefit program and the investment plan Public Employee
3649 Optional Retirement Program of the Florida Retirement System
3650 shall be applicable as provided under paragraph (b).
3651 (h) Reapplication.—A member participant whose initial
3652 application for disability retirement is has been denied may
3653 reapply for disability benefits in the same manner, and under
3654 the same conditions, as provided for members of the pension plan
3655 defined benefit program of the Florida Retirement System under
3656 s. 121.091(4)(g).
3657 (i) Membership.—Upon approval of a member’s an application
3658 for disability benefits under this subsection, the applicant
3659 shall be transferred to the pension plan defined benefit program
3660 of the Florida Retirement System, effective upon his or her
3661 disability retirement effective date.
3662 (j) Option to cancel.—A member Any participant whose
3663 application for disability benefits is approved may cancel the
3664 his or her application if for disability benefits, provided that
3665 the cancellation request is received by the division before a
3666 disability retirement warrant has been deposited, cashed, or
3667 received by direct deposit. Upon such cancellation:
3668 1. The member’s participant’s transfer to the pension plan
3669 defined benefit program under paragraph (i) shall be nullified;
3670 2. The member participant shall be retroactively reinstated
3671 in the investment plan Public Employee Optional Retirement
3672 program without hiatus;
3673 3. All funds transferred to the Florida Retirement System
3674 Trust Fund under paragraph (a) must shall be returned to the
3675 member participant accounts from which the such funds were
3676 drawn; and
3677 4. The member participant may elect to receive the benefit
3678 payable under the provisions of subsection (1) in lieu of
3679 disability benefits as provided under this subsection.
3680 (k) Recovery from disability.—
3681 1. The division may require periodic reexaminations at the
3682 expense of the disability program account of the Florida
3683 Retirement System Trust Fund. Except as otherwise provided in
3684 subparagraph 2., the requirements, procedures, and restrictions
3685 relating to the conduct and review of such reexaminations,
3686 discontinuation or termination of benefits, reentry into
3687 employment, disability retirement after reentry into covered
3688 employment, and all other matters relating to recovery from
3689 disability are shall be the same as provided are set forth under
3690 s. 121.091(4)(h).
3691 2. Upon recovery from disability, the any recipient of
3692 disability retirement benefits under this subsection shall be
3693 transferred back to the investment plan a compulsory member of
3694 the Public Employee Optional Retirement Program of the Florida
3695 Retirement System. The net difference between the recipient’s
3696 original account balance transferred to the Florida Retirement
3697 System Trust Fund, including earnings, under paragraph (a) and
3698 total disability benefits paid to such recipient, if any, shall
3699 be determined as provided in sub-subparagraph a.
3700 a. An amount equal to the total benefits paid shall be
3701 subtracted from that portion of the transferred account balance
3702 consisting of vested accumulations as described under s.
3703 121.4501(6), if any, and an amount equal to the remainder of
3704 benefit amounts paid, if any, shall then be subtracted from any
3705 remaining portion consisting of nonvested accumulations as
3706 described under s. 121.4501(6).
3707 b. Amounts subtracted under sub-subparagraph a. must shall
3708 be retained within the disability account of the Florida
3709 Retirement System Trust Fund. Any remaining account balance
3710 shall be transferred to the third-party administrator for
3711 disposition as provided under sub-subparagraph c. or sub
3712 subparagraph d., as appropriate.
3713 c. If the recipient returns to covered employment,
3714 transferred amounts must shall be deposited in individual
3715 accounts under the investment plan Public Employee Optional
3716 Retirement program, as directed by the member participant.
3717 Vested and nonvested amounts shall be separately accounted for
3718 as provided in s. 121.4501(6).
3719 d. If the recipient fails to return to covered employment
3720 upon recovery from disability:
3721 (I) Any remaining vested amount must shall be deposited in
3722 individual accounts under the investment plan Public Employee
3723 Optional Retirement program, as directed by the member
3724 participant, and is shall be payable as provided in subsection
3725 (1).
3726 (II) Any remaining nonvested amount must shall be held in a
3727 suspense account and is shall be forfeitable after 5 years as
3728 provided in s. 121.4501(6).
3729 3. If present value was reassigned from the pension plan
3730 defined benefit program to the disability program of the Florida
3731 Retirement System as provided under subparagraph (a)2., the full
3732 present value amount must shall be returned to the pension plan
3733 defined benefit account within the Florida Retirement System
3734 Trust Fund and the recipient’s affected individual’s associated
3735 retirement credit under the pension plan must defined benefit
3736 program shall be reinstated in full. Any benefit based upon such
3737 credit must shall be calculated as provided in s.
3738 121.091(4)(h)1.
3739 (l) Nonadmissible causes of disability.—A member is
3740 participant shall not be entitled to receive a disability
3741 retirement benefit if the disability results from any injury or
3742 disease sustained or inflicted as described in s. 121.091(4)(i).
3743 (m) Disability retirement of justice or judge by order of
3744 Supreme Court.—
3745 1. If a member participant is a justice of the Supreme
3746 Court, judge of a district court of appeal, circuit judge, or
3747 judge of a county court who has served for 6 years or more as an
3748 elected constitutional judicial officer, including service as a
3749 judicial officer in any court abolished pursuant to Art. V of
3750 the State Constitution, and who is retired for disability by
3751 order of the Supreme Court upon recommendation of the Judicial
3752 Qualifications Commission pursuant to s. 12, the provisions of
3753 Art. V of the State Constitution, the member’s participant’s
3754 Option 1 monthly disability benefit amount as provided in s.
3755 121.091(6)(a)1. shall be two-thirds of his or her monthly
3756 compensation as of the member’s participant’s disability
3757 retirement date. The member Such a participant may alternatively
3758 elect to receive an actuarially adjusted disability retirement
3759 benefit under any other option as provided in s. 121.091(6)(a),
3760 or to receive the normal benefit payable under the Public
3761 Employee Optional Retirement Program as set forth in subsection
3762 (1).
3763 2. If any justice or judge who is a member participant of
3764 the investment plan Public Employee Optional Retirement program
3765 of the Florida Retirement System is retired for disability by
3766 order of the Supreme Court upon recommendation of the Judicial
3767 Qualifications Commission pursuant to s. 12, the provisions of
3768 Art. V of the State Constitution, and elects to receive a
3769 monthly disability benefit under the provisions of this
3770 paragraph:
3771 a. Any present value amount that was transferred to his or
3772 her plan program account and all employer contributions made to
3773 such account on his or her behalf, plus interest and earnings
3774 thereon, must shall be transferred to and deposited in the
3775 disability account of the Florida Retirement System Trust Fund;
3776 and
3777 b. The monthly disability benefits payable under this
3778 paragraph for any affected justice or judge retired from the
3779 Florida Retirement System pursuant to Art. V of the State
3780 Constitution shall be paid from the disability account of the
3781 Florida Retirement System Trust Fund.
3782 (n) Death of retiree or beneficiary.—Upon the death of a
3783 disabled retiree or beneficiary of the retiree thereof who is
3784 receiving monthly disability benefits under this subsection, the
3785 monthly benefits shall be paid through the last day of the month
3786 of death and shall terminate, or be adjusted, if applicable, as
3787 of that date in accordance with the optional form of benefit
3788 selected at the time of retirement. The department of Management
3789 Services may adopt rules necessary to administer this paragraph.
3790 (3) DEATH BENEFITS.—Under the Florida Public Employee
3791 Optional Retirement System Investment Plan Program:
3792 (a) Survivor benefits are shall be payable in accordance
3793 with the following terms and conditions:
3794 1. To the extent vested, Benefits are shall be payable only
3795 to a member’s participant’s beneficiary or beneficiaries as
3796 designated by the member participant as provided in s.
3797 121.4501(20).
3798 2. Benefits shall be paid by the third-party administrator
3799 or designated approved providers in accordance with the law, the
3800 contracts, and any applicable state board rule or policy.
3801 3. To receive benefits under this subsection, the member
3802 participant must be deceased.
3803 (b) Except as provided in paragraph (d), if the employment
3804 of a member is terminated by reason of his or her In the event
3805 of a participant’s death:,
3806 1. Before being vested, the member’s accumulated
3807 contributions are payable to his or her designated beneficiary.
3808 2. After being vested, all vested accumulations as
3809 described in s. 121.4501(6), less withholding taxes remitted to
3810 the Internal Revenue Service, shall be distributed, as provided
3811 in paragraph (c) or as described in s. 121.4501(20), as if the
3812 member participant retired on the date of death. No other death
3813 benefits are shall be available for survivors of members
3814 participants under the investment plan Public Employee Optional
3815 Retirement Program, except for such benefits, or coverage for
3816 such benefits, as are otherwise provided by law or are
3817 separately provided afforded by the employer, at the employer’s
3818 discretion.
3819 (c) Upon receipt by the third-party administrator of a
3820 properly executed application for distribution of benefits under
3821 paragraph (b), the total accumulated benefit is shall be payable
3822 by the third-party administrator to the member’s participant’s
3823 surviving beneficiary or beneficiaries, as:
3824 1. A lump-sum distribution payable to the beneficiary or
3825 beneficiaries, or to the deceased member’s participant’s estate;
3826 2. An eligible rollover distribution on behalf of the
3827 surviving spouse of a deceased member participant, whereby all
3828 accrued benefits, plus interest and investment earnings, are
3829 paid from the deceased member’s participant’s account directly
3830 to the custodian of an eligible retirement plan, as described in
3831 s. 402(c)(8)(B) of the Internal Revenue Code, on behalf of the
3832 surviving spouse; or
3833 3. A partial lump-sum payment whereby a portion of the
3834 accrued benefit is paid to the deceased member’s participant’s
3835 surviving spouse or other designated beneficiaries, less
3836 withholding taxes remitted to the Internal Revenue Service, and
3837 the remaining amount is transferred directly to the custodian of
3838 an eligible retirement plan, as described in s. 402(c)(8)(B) of
3839 the Internal Revenue Code, on behalf of the surviving spouse.
3840 The proportions must be specified by the member participant or
3841 the surviving beneficiary.
3842 (d) Notwithstanding paragraphs (b) and (c), if a member is
3843 killed in the line of duty, benefits are payable from employer
3844 contributions made pursuant to s. 121.571, transferred members
3845 funds accumulated pursuant to sub-subparagraph 1.a., and
3846 interest and earnings thereon.
3847 1. Transfer of funds.—
3848 a. All moneys accumulated in the deceased member’s
3849 investment plan accounts, including vested and nonvested
3850 accumulations described in s. 121.4501(6), shall be transferred
3851 from such individual accounts to the Division of Retirement for
3852 deposit in the death benefits program of the Florida Retirement
3853 System Trust Fund. Such moneys must be separately accounted for.
3854 Earnings shall be credited on an annual basis for amounts held
3855 in the death benefits accounts of the trust fund based on actual
3856 earnings of the trust fund.
3857 b. If the deceased member retained retirement credit he or
3858 she earned under the pension plan as provided in s.
3859 121.4501(3)(b), a sum representing the actuarial present value
3860 of such credit within the Florida Retirement System Trust Fund
3861 shall be reassigned by the Division of Retirement from the
3862 pension plan to the death benefits program as implemented under
3863 this paragraph and deposited in the death benefits account of
3864 the trust fund. Such moneys shall be separately accounted for.
3865 2. Death benefit entitlement and payments.—
3866 a. The surviving spouse of a member killed in the line of
3867 duty may receive a monthly pension equal to one-half of the
3868 monthly salary being received by the member at the time of death
3869 for the rest of the surviving spouse’s lifetime.
3870 b. If the surviving spouse of a member killed in the line
3871 of duty dies, the monthly payments that would have been payable
3872 to the surviving spouse had such surviving spouse lived shall be
3873 paid for the use and benefit of such member’s children under 18
3874 years of age and unmarried until the 18th birthday of the
3875 member’s youngest child.
3876 c. If a member killed in the line of duty leaves no
3877 surviving spouse but is survived by children under 18 years of
3878 age, the benefits provided by sub-subparagraph a., normally
3879 payable to a surviving spouse, shall be paid for the use and
3880 benefit of the member’s child or children under 18 years of age
3881 and unmarried until the 18th birthday of the member’s youngest
3882 child.
3883
3884 This paragraph does not abrogate other applicable provisions of
3885 state or federal law providing for payment of death benefits.
3886 (4) LIMITATION ON LEGAL PROCESS.—The benefits payable to
3887 any person under the Florida Public Employee Optional Retirement
3888 System Investment Plan Program, and any contributions
3889 accumulated under such plan program, are not subject to
3890 assignment, execution, attachment, or any legal process, except
3891 for qualified domestic relations orders by a court of competent
3892 jurisdiction, income deduction orders as provided in s. 61.1301,
3893 and federal income tax levies.
3894 Section 26. Section 121.5911, Florida Statutes, is amended
3895 to read:
3896 121.5911 Disability retirement program; qualified status;
3897 rulemaking authority.—It is the intent of the Legislature that
3898 the disability retirement program for members participants of
3899 the Florida Public Employee Optional Retirement System
3900 Investment Plan Program as created in this act must meet all
3901 applicable requirements of federal law for a qualified plan. The
3902 department of Management Services shall seek a private letter
3903 ruling from the Internal Revenue Service on the disability
3904 retirement program for participants of the Public Employee
3905 Optional Retirement Program. Consistent with the private letter
3906 ruling, the department of Management Services shall adopt any
3907 necessary rules necessary required to maintain the qualified
3908 status of the disability retirement program and the Florida
3909 Retirement System’s pension System defined benefit plan.
3910 Section 27. Subsection (1) of section 121.70, Florida
3911 Statutes, is amended to read:
3912 121.70 Legislative purpose and intent.—
3913 (1) This part provides for a uniform system for funding
3914 benefits provided under the Florida Retirement System defined
3915 benefit program established under part I of this chapter,
3916 (referred to in this part as the pension plan, defined benefit
3917 program) and under the Florida Public Employee Optional
3918 Retirement System Investment Plan Program established under part
3919 II of this chapter, (referred to in this part as the investment
3920 plan optional retirement program). The Legislature recognizes
3921 and declares that the Florida Retirement System is a single
3922 retirement system, consisting of two retirement plans and other
3923 nonintegrated programs. Employers participating in the Florida
3924 Retirement System collectively shall be responsible for making
3925 contributions to support the benefits provided afforded under
3926 both programs plans. The As provided in this part, employers
3927 participating in the Florida Retirement System shall make
3928 contributions based upon uniform contribution rates determined
3929 as a percentage of the total payroll for each class or subclass
3930 of Florida Retirement System membership, irrespective of which
3931 retirement program the plan individual employee is enrolled in
3932 employees may elect. This shall be known as a uniform or blended
3933 contribution rate system.
3934 Section 28. Subsections (1) and (2) of section 121.71,
3935 Florida Statutes, are amended, present subsections (3) and (4)
3936 of that section are renumbered as subsections (4) and (7),
3937 respectively, and new subsections (3), (5), and (6) are added to
3938 that section, to read:
3939 121.71 Uniform rates; process; calculations; levy.—
3940 (1) In conducting the system actuarial study required under
3941 s. 121.031, the actuary shall follow all requirements specified
3942 thereunder to determine, by Florida Retirement System employee
3943 membership class, the dollar contribution amounts necessary for
3944 the next forthcoming fiscal year for the pension plan defined
3945 benefit program. In addition, the actuary shall determine, by
3946 Florida Retirement System membership class, based on an estimate
3947 for the forthcoming fiscal year of the gross compensation of
3948 employees participating in the investment plan optional
3949 retirement program, the dollar contribution amounts necessary to
3950 make the allocations required under ss. 121.72 and 121.73. For
3951 each employee membership class and subclass, the actuarial study
3952 must shall establish a uniform rate necessary to fund the
3953 benefit obligations under both Florida Retirement System
3954 retirement plans by dividing the sum of total dollars required
3955 by the estimated gross compensation of members in both plans.
3956 (2) Based on the uniform rates set forth in subsections
3957 subsection (3), (4), and (5), employers and employees shall make
3958 monthly contributions to the Division of Retirement as required
3959 under s. 121.061(1), which shall initially deposit the funds
3960 into the Florida Retirement System Contributions Clearing Trust
3961 Fund. A change in a contribution rate is effective on the first
3962 day of the month for which a full month’s employer contribution
3963 may be made on or after the beginning date of the change.
3964 Beginning July 1, 2011, each employee shall contribute the
3965 contributions required in subsection (3) to the plan. The
3966 employer shall deduct the contribution from the employee’s
3967 monthly salary and submit it to the division. The contributions
3968 shall be reported as employer-paid employee contributions, and
3969 shall be credited to the account of the employee. The
3970 contributions shall be deducted from the employee’s salary
3971 before the computation of applicable federal taxes and treated
3972 as employer contributions under 26 U.S.C. 414(b)(2). Although
3973 designated as employee contributions, the employer specifies
3974 that the contributions are being paid by the employer in lieu of
3975 contributions by the employee. The employee does not have the
3976 option of choosing to receive the contributed amounts directly
3977 instead of having them paid to the plan. Such contributions are
3978 mandatory and each employee is deemed to have consented to the
3979 payroll deductions. Payment of an employee’s salary or wages,
3980 less the contribution, is a full and complete discharge and
3981 satisfaction of all claims and demands for the service rendered
3982 by employees during the period covered by the payment, except
3983 for claims to benefits to which they may be entitled under this
3984 chapter.
3985 (3) Required employee retirement contribution rates for
3986 each membership class and subclass of the Florida Retirement
3987 System for both retirement plans are as follows:
3988 Membership Class Percentage of Gross Compensation,Effective July 1, 2011
3989 Regular Class ____%
3990 Special Risk Class ____%
3991 Special Risk Administrative Support Class ____%
3992 Elected Officers’ Class - Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders ____%
3993 Elected Officers’ Class - Justices, Judges ____%
3994 Elected Officers’ Class - County Elected Officers ____%
3995 Senior Management Class ____%
3996 DROP ____%
3997 (4)(3) Required employer retirement contribution rates for
3998 each membership class and subclass of the Florida Retirement
3999 System for both retirement plans are as follows:
4000 Membership Class Percentage ofGrossCompensation,EffectiveJuly 1, 2011 2009 Percentage ofGrossCompensation,EffectiveJuly 1, 2012 2010
4001
4002 Regular Class 9.76% 8.69% 9.54% 9.63%
4003 Special Risk Class 22.20 19.76% 21.92% 22.11%
4004 Special Risk Administrative Support Class 11.41% 11.39% 11.02% 12.10%
4005 Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders 14.48% 13.32% 14.15% 15.20%
4006 Elected Officers’ Class— Justices, Judges 19.43% 18.40% 19.15% 20.65%
4007 Elected Officers’ Class— County Elected Officers 16.73% 15.37% 16.39% 17.50%
4008 Senior Management Class 11.70% 11.96% 16.39% 13.43%
4009 DROP 13.79% 9.80% 14.21% 11.14%
4010 (5) In order to address unfunded actuarial liabilities of
4011 the system, the required employer retirement contribution rates
4012 for each membership class and subclass of the Florida Retirement
4013 System for both retirement plans are as follows:
4014
4015
4016
4017
4018
4019
4020
4021
4022
4023
4024
4025
4026
4027
4028
4029
4030
4031
4032
4033
4034
4035 (6) If a member is reported under an incorrect membership
4036 class and the amount of contributions reported and remitted are
4037 less than the amount required, the employer shall owe the
4038 difference plus the delinquent fee of 1 percent for each
4039 calendar month or part thereof that the contributions should
4040 have been paid. This delinquent assessment may not be waived. If
4041 the contributions reported and remitted are more than the amount
4042 required, the employer shall receive a credit to be applied
4043 against future contributions owed.
4044 (7)(4) The state actuary shall recognize and use an
4045 appropriate level of available excess assets of the Florida
4046 Retirement System Trust Fund to offset the difference between
4047 the normal costs of the Florida Retirement System and the
4048 statutorily prescribed contribution rates.
4049 Section 29. Section 121.72, Florida Statutes, is amended to
4050 read:
4051 121.72 Allocations to investment plan member optional
4052 retirement program participant accounts; percentage amounts.—
4053 (1) The allocations established in subsection (4) shall
4054 fund retirement benefits under the investment plan under part II
4055 of this chapter optional retirement program and shall be
4056 transferred monthly by the Division of Retirement from the
4057 Florida Retirement System Contributions Clearing Trust Fund to
4058 the third-party administrator for deposit in each participating
4059 employee’s individual account based on the membership class of
4060 the employee participant.
4061 (2) The allocations are stated as a percentage of each
4062 investment plan member’s optional retirement program
4063 participant’s gross compensation for the calendar month. A
4064 change in a contribution percentage is effective the first day
4065 of the month for which retirement contributions a full month’s
4066 employer contribution may be made on or after the beginning date
4067 of the change. Contribution percentages may be modified by
4068 general law.
4069 (3) Employer and employee participant contributions to
4070 member’s participant accounts shall be accounted for separately.
4071 Participant contributions may be made only if expressly
4072 authorized by law. Interest and investment earnings on
4073 contributions shall accrue on a tax-deferred basis until
4074 proceeds are distributed.
4075 (4) Effective July 1, 2011 July 1, 2002, allocations from
4076 the Florida Retirement System Contributions Clearing Trust Fund
4077 to investment plan member optional retirement program
4078 participant accounts, including employee contributions required
4079 under s. 121.71(3), are shall be as follows:
4080 Membership Class Percentage of Gross Compensation
4081
4082 Regular Class 9.00%
4083 Special Risk Class 20.00%
4084 Special Risk Administrative Support Class 11.35%
4085 Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders 13.40%
4086 Elected Officers’ Class— Justices, Judges 18.90%
4087 Elected Officers’ Class— County Elected Officers 16.20%
4088 Senior Management Service Class 10.95%
4089
4090 Section 30. Section 121.73, Florida Statutes, is amended to
4091 read:
4092 121.73 Allocations for member optional retirement program
4093 participant disability coverage; percentage amounts.—
4094 (1) The allocations established in subsection (3) shall be
4095 used to provide disability coverage for members of the
4096 investment plan participants in the optional retirement program
4097 and shall be transferred monthly by the Division of Retirement
4098 from the Florida Retirement System Contributions Clearing Trust
4099 Fund to the disability account of the Florida Retirement System
4100 Trust Fund.
4101 (2) The allocations are stated as a percentage of each
4102 investment plan participant’s optional retirement program
4103 participant’s gross compensation for the calendar month. A
4104 change in a contribution percentage is effective the first day
4105 of the month for which retirement contributions a full month’s
4106 employer contribution may be made on or after the beginning date
4107 of the change. Contribution percentages may be modified by
4108 general law.
4109 (3) Effective July 1, 2002, allocations from the Florida
4110 Retirement System FRS Contribution Clearing Fund to provide
4111 disability coverage for members of the investment plan
4112 participants in the optional retirement program, and to offset
4113 the costs of administering said coverage, shall be as follows:
4114 Membership Class Percentage of Gross Compensation
4115
4116 Regular Class 0.25%
4117 Special Risk Class 1.33%
4118 Special Risk Administrative Support Class 0.45%
4119 Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders 0.41%
4120 Elected Officers’ Class— Justices, Judges 0.73%
4121 Elected Officers’ Class— County Elected Officers 0.41%
4122 Senior Management Service Class 0.26%
4123
4124 (4) Effective July 1, 2011, allocations from the Florida
4125 Retirement System Contribution Clearing Fund to provide
4126 disability coverage for members of the investment plan and to
4127 offset the costs of administering such coverage shall be the
4128 actuarially indicated amount necessary to fund the statutorily
4129 authorized benefit for the plan year as determined by the
4130 department’s actuary.
4131 Section 31. Section 121.74, Florida Statutes, is amended to
4132 read:
4133 121.74 Administrative and educational expenses.—In addition
4134 to contributions required under ss. s. 121.71 and 121.73,
4135 effective July 1, 2010, through June 30, 2014, employers
4136 participating in the Florida Retirement System shall contribute
4137 an amount equal to 0.03 percent of the payroll reported for each
4138 class or subclass of Florida Retirement System membership;
4139 effective July 1, 2014, the contribution rate shall be 0.04
4140 percent of the payroll reported for each class or subclass of
4141 membership. The amount contributed shall be transferred by the
4142 Division of Retirement from the Florida Retirement System
4143 Contributions Clearing Trust Fund to the state board’s Board of
4144 Administration’s administrative trust fund to offset the costs
4145 of administering the investment plan optional retirement program
4146 and the costs of providing educational services to participants
4147 in the pension plan defined benefit program and the investment
4148 plan optional retirement program. Approval of the trustees is
4149 required before the expenditure of these funds. Payments for
4150 third-party administrative or educational expenses shall be made
4151 only pursuant to the terms of the approved contracts for such
4152 services.
4153 Section 32. Section 121.75, Florida Statutes, is amended to
4154 read:
4155 121.75 Allocation for pension plan defined benefit
4156 program.—After making the transfers required pursuant to ss.
4157 121.71, 121.72, 121.73, and 121.74, the monthly balance of funds
4158 in the Florida Retirement System Contributions Clearing Trust
4159 Fund shall be transferred to the Florida Retirement System Trust
4160 Fund to pay the costs of providing pension plan defined benefit
4161 program benefits and plan administrative costs under the pension
4162 plan defined benefit program.
4163 Section 33. Section 121.77, Florida Statutes, is amended to
4164 read:
4165 121.77 Deductions from member participant accounts.—The
4166 State Board of Administration may authorize the third-party
4167 administrator to deduct reasonable fees and apply appropriate
4168 charges to investment plan member optional retirement program
4169 participant accounts. In no event may shall administrative and
4170 educational expenses exceed the portion of employer
4171 contributions earmarked for such expenses under this part,
4172 except for reasonable administrative charges assessed against
4173 member participant accounts of persons for whom no employer
4174 contributions are made during the calendar quarter. Investment
4175 management fees shall be deducted from member participant
4176 accounts, pursuant to the terms of the contract between the
4177 provider and the board.
4178 Section 34. Subsections (1) and (3) of section 121.78,
4179 Florida Statutes, are amended to read:
4180 121.78 Payment and distribution of contributions.—
4181 (1) Contributions made pursuant to this part, including the
4182 employee contributions, shall be paid by the employer to the
4183 Division of Retirement by electronic funds transfer no later
4184 than the 5th working day of the month immediately following the
4185 month during which the payroll period ended. Accompanying
4186 payroll data must be transmitted to the division concurrent with
4187 the contributions.
4188 (3)(a) Employer and employee contributions and accompanying
4189 payroll data received after the 5th working day of the month are
4190 considered late. The employer shall be assessed by the Division
4191 of Retirement a penalty of 1 percent of the contributions due
4192 for each calendar month or part thereof that the contributions
4193 or accompanying payroll data are late. Proceeds from the 1
4194 percent assessment against contributions made on behalf of
4195 members of the pension plan participants of the defined benefit
4196 program shall be deposited in the Florida Retirement System
4197 Trust Fund, and proceeds from the 1 percent 1-percent assessment
4198 against contributions made on behalf of members of the
4199 investment plan participants of the optional retirement program
4200 shall be transferred to the third-party administrator for
4201 deposit into member participant accounts, as provided in
4202 paragraph (c) (b).
4203 (b) Retirement contributions paid for a prior period shall
4204 be charged a delinquent fee of 1 percent for each calendar month
4205 or part thereof that the contributions should have been paid.
4206 This includes prior period contributions due to incorrect wages,
4207 contributions from an earlier report or wages, and contributions
4208 that should have been reported but were not. The delinquent
4209 assessments may not be waived.
4210 (c)(b) If employee contributions or contributions made by
4211 an employer on behalf of members of the investment plan
4212 participants of the optional retirement program or accompanying
4213 payroll data are not received within the calendar month they are
4214 due, including, but not limited to, contribution adjustments as
4215 a result of employer errors or corrections, and if that
4216 delinquency results in market losses to members participants,
4217 the employer shall reimburse each member’s participant’s account
4218 for market losses resulting from the late contributions. If a
4219 member participant has terminated employment and taken a
4220 distribution, the member participant is responsible for
4221 returning any excess contributions erroneously provided by
4222 employers, adjusted for any investment gain or loss incurred
4223 during the period such excess contributions were in the member’s
4224 participant’s account. The state board or its designated agent
4225 shall communicate to terminated members participants any
4226 obligation to repay such excess contribution amounts. However,
4227 the state board, its designated agents, the Florida Public
4228 Employee Optional Retirement System Investment Plan Program
4229 Trust Fund, the department, or the Florida Retirement System
4230 Trust Fund may not incur any loss or gain as a result of an
4231 employer’s correction of such excess contributions. The third
4232 party administrator, hired by the state board pursuant to s.
4233 121.4501(8), shall calculate the market losses for each affected
4234 member participant. If contributions made on behalf of members
4235 of the investment plan participants of the optional retirement
4236 program or accompanying payroll data are not received within the
4237 calendar month due, the employer shall also pay the cost of the
4238 third-party administrator’s calculation and reconciliation
4239 adjustments resulting from the late contributions. The third
4240 party administrator shall notify the employer of the results of
4241 the calculations and the total amount due from the employer for
4242 such losses and the costs of calculation and reconciliation. The
4243 employer shall remit to the Division of Retirement the amount
4244 due within 30 working days after the date of the penalty notice
4245 sent by the division. The division shall transfer that amount to
4246 the third-party administrator, which shall deposit proceeds from
4247 the 1 percent 1-percent assessment and from individual market
4248 losses into member participant accounts, as appropriate. The
4249 state board may adopt rules to administer the provisions
4250 regarding late contributions, late submission of payroll data,
4251 the process for reimbursing member participant accounts for
4252 resultant market losses, and the penalties charged to the
4253 employers.
4254 (d) If employee contributions reported by an employer on
4255 behalf of the employee are reduced as a result of employer
4256 errors or corrections and the employee has terminated employment
4257 and taken a refund or distribution, the employer shall be billed
4258 and is responsible for recovering from the employee any excess
4259 contributions erroneously provided by the employer.
4260 (e)(c) Delinquency fees specified in paragraph (a) may be
4261 waived by the Division of Retirement, with regard to pension
4262 plan defined benefit program contributions, and by the state
4263 board, with regard to investment plan optional retirement
4264 program contributions, only if, in the opinion of the division
4265 or the board, as appropriate, exceptional circumstances beyond
4266 the employer’s control prevented remittance by the prescribed
4267 due date notwithstanding the employer’s good faith efforts to
4268 effect delivery. Such a waiver of delinquency may be granted an
4269 employer only once each plan state fiscal year.
4270 (f) If the employer submits excess employer or employee
4271 contributions, the employer shall receive a credit to be applied
4272 against future contributions owed. The employer is responsible
4273 for reimbursing the employee for any excess contributions
4274 submitted if any return of such an erroneous excess pretax
4275 contribution by the program is made within 1 year after making
4276 erroneous contributions or such other period as allowed under
4277 applicable Internal Revenue Service guidance.
4278 (g)(d) If contributions made by an employer on behalf of
4279 members of the investment program participants in the optional
4280 retirement program are delayed in posting to member participant
4281 accounts due to acts of God beyond the control of the Division
4282 of Retirement, the state board, or the third-party
4283 administrator, as applicable, market losses resulting from the
4284 late contributions are not payable to the members participants.
4285 Section 35. Paragraph (a) of subsection (4) of section
4286 1012.875, Florida Statutes, is amended to read:
4287 1012.875 State Community College System Optional Retirement
4288 Program.—Each community college may implement an optional
4289 retirement program, if such program is established therefor
4290 pursuant to s. 1001.64(20), under which annuity or other
4291 contracts providing retirement and death benefits may be
4292 purchased by, and on behalf of, eligible employees who
4293 participate in the program, in accordance with s. 403(b) of the
4294 Internal Revenue Code. Except as otherwise provided herein, this
4295 retirement program, which shall be known as the State Community
4296 College System Optional Retirement Program, may be implemented
4297 and administered only by an individual community college or by a
4298 consortium of community colleges.
4299 (4)(a) Through June 30, 2011, each college must contribute
4300 on behalf of each program member participant an amount equal to
4301 10.43 percent of the employee’s participant’s gross monthly
4302 compensation. Effective July 1, 2011, each member shall
4303 contribute an amount equal to the employee contribution required
4304 under s. 121.71(3). Effective July 1, 2011, each employer shall
4305 contribute on behalf of each program member an amount equal to
4306 the difference between 10.43 percent of the employee’s gross
4307 monthly compensation and the employee’s required contribution
4308 based on the employee’s gross monthly compensation. The college
4309 shall deduct an amount approved by the district board of
4310 trustees of the college to provide for the administration of the
4311 optional retirement program. Payment of this contribution must
4312 be made either directly by the college or through the program
4313 administrator to the designated company contracting for payment
4314 of benefits to the program member participant.
4315 Section 36. The Legislature finds that a proper and
4316 legitimate state purpose is served when employees and retirees
4317 of the state and its political subdivisions, and the dependents,
4318 survivors, and beneficiaries of such employees and retirees, are
4319 extended the basic protections afforded by governmental
4320 retirement systems. These persons must be provided benefits that
4321 are fair and adequate and that are managed, administered, and
4322 funded in an actuarially sound manner, as required by s. 14,
4323 Article X of the State Constitution and part VII of chapter 112,
4324 Florida Statutes. Therefore, the Legislature determines and
4325 declares that this act fulfills an important state interest.
4326 Section 37. The Division of Statutory Revision is requested
4327 to rename the title of part II of chapter 121, Florida Statutes,
4328 as “Florida Retirement System Investment Plan.”
4329 Section 38. (1) Effective upon this act becoming a law, the
4330 State Board of Administration and the Department of Management
4331 Services shall, as soon as practicable, request a determination
4332 letter and private letter ruling from the United States Internal
4333 Revenue Service. If the Internal Revenue Service refuses to act
4334 upon a request for a private letter ruling, the legal opinion
4335 from a qualified tax attorney or firm may be substituted for the
4336 private letter ruling.
4337 (2) If the board or the department receives notification
4338 from the United States Internal Revenue Service that this act or
4339 any portion of this act will cause the Florida Retirement
4340 System, or a portion thereof, to be disqualified for tax
4341 purposes under the Internal Revenue Code, then that portion does
4342 not apply. Upon such notice, the state board and the department
4343 shall notify the presiding officers of the Legislature.
4344 Section 39. Except as otherwise expressly provided in this
4345 act, this act shall take effect June 30, 2011.
4346
4347 ================= T I T L E A M E N D M E N T ================
4348 And the title is amended as follows:
4349 Delete everything before the enacting clause
4350 and insert:
4351 A bill to be entitled
4352 An act relating to retirement; amending s. 110.123,
4353 F.S.; conforming provisions to changes made by the
4354 act; amending ss. 112.0801, 112.363, and 112.65, F.S.;
4355 conforming provisions to changes made by the act;
4356 amending s. 121.011, F.S.; requiring employee and
4357 employer contributions to the retirement system by a
4358 certain date; amending s. 121.021, F.S.; redefining
4359 the terms “system,” “prior service,” “compensation,”
4360 “average final compensation,” “benefit,” and “payee”;
4361 amending s. 121.051, F.S.; conforming provisions to
4362 changes made by the act; amending s. 121.0515, F.S.;
4363 providing that special risk employee contributions be
4364 used, if applicable, when purchasing credit for past
4365 service; conforming a cross-reference; amending s.
4366 121.052, F.S., relating to the membership class of
4367 elected officers; conforming provisions to changes
4368 made by the act; providing for a refund of
4369 contributions under certain circumstances for an
4370 officer who leaves office; prohibiting such refund if
4371 an approved qualified domestic relations order is
4372 filed against the member’s retirement account;
4373 providing that a member who obtains a refund of
4374 contributions waives certain rights under the Florida
4375 Retirement System; conforming a cross-reference;
4376 amending s. 121.053, F.S.; conforming provisions to
4377 changes made by the act; amending s. 121.055, F.S.,
4378 relating to the Senior Management Service Class;
4379 conforming provisions to changes made by the act;
4380 prohibiting such refund if an approved qualified
4381 domestic relations order is filed against the member’s
4382 retirement account; providing that a member who
4383 obtains a refund of contributions waives certain
4384 rights under the Florida Retirement System; requiring
4385 employee and employer contributions for members in the
4386 Senior Management Service Optional Annuity Program
4387 after a certain date; limiting the payment of benefits
4388 before a member’s termination of employment; amending
4389 s. 121.071, F.S.; requiring employee and employer
4390 contributions to the retirement system beginning on a
4391 certain date; providing for a refund of contributions
4392 under certain circumstances following termination of
4393 employment; prohibiting such refund if an approved
4394 qualified domestic relations order is filed against
4395 the member’s retirement account; providing that a
4396 member who obtains a refund of contributions waives
4397 certain rights under the Florida Retirement System;
4398 requiring repayment plus interest of an invalid
4399 refund; amending s. 121.081, F.S.; providing
4400 requirements for contributions for prior service
4401 performed on or after a certain date; amending s.
4402 121.091, F.S.; conforming a cross-reference; delaying
4403 the refund or payment of accumulated employee
4404 contributions if a member’s employment is terminated
4405 for any reason other than death or retirement;
4406 requiring repayment plus interest of an invalid
4407 refund; prohibiting such refund if an approved
4408 qualified domestic relations order is filed against
4409 the member’s retirement account; providing that a
4410 member who obtains a refund of contributions waives
4411 certain rights under the Florida Retirement System;
4412 conforming provisions to changes made by the act;
4413 amending s. 121.1001, F.S.; conforming provisions to
4414 changes made by the act; amending s. 121.121, F.S.,
4415 relating to the purchase of creditable service
4416 following an authorized leave of absence; requiring
4417 that service credit be purchased at the employee and
4418 employer contribution rates in effect during the leave
4419 of absence; reducing the interest rate on benefits
4420 payable under the Deferred Retirement Option Program
4421 for employees hired after a certain date; amending s.
4422 121.122, F.S.; providing for renewed membership in the
4423 retirement system for retirees who are reemployed
4424 after a certain date; specifying requirements and
4425 limitations; amending s. 121.125, F.S.; conforming
4426 provisions to changes made by the act; amending s.
4427 121.35, F.S., relating to the optional retirement
4428 program for the State University System; conforming
4429 provisions to changes made by the act; requiring
4430 employee and employer contributions for members
4431 participating in the optional retirement program after
4432 a certain date; deleting certain requirements
4433 governing employer contributions to conform to changes
4434 made by the act; conforming cross-references; amending
4435 s. 121.355, F.S.; conforming provisions to changes
4436 made by the act; amending s. 121.4501, F.S.; changing
4437 the name of the Public Employee Optional Retirement
4438 Program to the Florida Retirement System Investment
4439 Plan; limiting the option of enrolling in the State
4440 Retirement System’s defined benefit program or defined
4441 contribution program to public employees employed
4442 before a certain date; requiring public employees
4443 employed on or after a certain date to enroll in the
4444 investment plan; providing exceptions; requiring that
4445 plan members make contributions to the plan based on
4446 the employee’s membership class; revising definitions;
4447 deleting obsolete provisions relating to the 2002
4448 optional transfer of public employees from the pension
4449 plan to the investment plan; providing for past
4450 employees who reenter the system; providing for
4451 contribution adjustments as a result of errors or
4452 corrections; requiring an employer to receive a credit
4453 for excess contributions and to reimburse an employee
4454 for excess contributions, subject to certain
4455 limitations; providing for a retiree to retain his or
4456 her prior plan choice following a return to
4457 employment; limiting certain refunds of contributions
4458 which exceed the amount that would have accrued had
4459 the member remained in the pension plan; providing
4460 certain requirements and limitations with respect to
4461 contributions; clarifying that employee and employer
4462 contributions are earmarked for specified purposes;
4463 providing duties of the third-party administrator;
4464 providing that a member is vested immediately with
4465 respect to employee contributions paid by the
4466 employee; providing for the forfeiture of nonvested
4467 employer contributions and service credit based on
4468 years of service; amending s. 121.4502, F.S.;
4469 conforming provisions to changes made by the act;
4470 amending s. 121.4503, F.S.; providing for the deposit
4471 of employee contributions into the Florida Retirement
4472 System Contributions Clearing Trust Fund; amending s.
4473 121.571, F.S.; conforming provisions to changes made
4474 by the act; providing requirements for submitting
4475 employee contributions; amending s. 121.591, F.S.;
4476 providing for the forfeiture of nonvested
4477 accumulations upon payment of certain vested benefits;
4478 providing that the distribution payment method
4479 selected by the member or beneficiary is irrevocable
4480 at the time of distribution; prohibiting a
4481 distribution of employee contributions if a qualified
4482 domestic relations order is filed against the member’s
4483 account; providing for the distribution of an
4484 employee’s contributions if the employee dies before
4485 being vested; providing for the establishment of a
4486 death benefits program in the Florida Retirement
4487 System Trust Fund and the payment of benefits if the
4488 employee dies in the line of duty; conforming
4489 provisions to changes made by the act; amending ss.
4490 121.5911 and 121.70, F.S.; conforming provisions to
4491 changes made by the act; amending s. 121.71, F.S.;
4492 providing for employee contributions to be deducted
4493 from the employee’s monthly salary, beginning on a
4494 specified date, and treated as employer contributions
4495 under certain provisions of federal law; clarifying
4496 that an employee may not receive such contributions
4497 directly; specifying the required employee
4498 contribution rates for the membership of each
4499 membership class and subclass of the Florida
4500 Retirement System; specifying the required employer
4501 retirement contribution rates for each membership
4502 class and subclass of the system in order to address
4503 unfunded actuarial liabilities of the system;
4504 requiring an assessment to be imposed if the employee
4505 contributions remitted are less than the amount
4506 required; providing for the employer to receive a
4507 credit for excess contributions remitted; conforming
4508 cross-references; amending s. 121.72, F.S.; revising
4509 certain requirements governing allocations to optional
4510 retirement program member accounts; conforming cross
4511 references; amending s. 121.73, F.S., relating to
4512 disability coverage for members of the optional
4513 retirement program; conforming provisions to changes
4514 made by the act; amending ss. 121.74, 121.75, and
4515 121.77, F.S.; conforming provisions to changes made by
4516 the act; conforming cross-references; amending s.
4517 121.78, F.S.; revising certain requirements for
4518 administering the payment and distribution of
4519 contributions; requiring that certain fees be imposed
4520 for delinquent payment; providing that an employer is
4521 responsible for recovering any refund provided to an
4522 employee in error; revising the terms of an authorized
4523 waiver of delinquency; requiring an employer to
4524 receive a credit for excess contributions and to
4525 reimburse an employee for excess contributions,
4526 subject to certain limitations; amending s. 1012.875,
4527 F.S.; requiring employee and employer contributions
4528 for members of the State Community College System
4529 Optional Retirement Program on a certain date;
4530 conforming cross-references; providing that the act
4531 fulfills an important state interest; providing a
4532 directive to the Division of Statutory Revision;
4533 requiring the State Board of Administration and the
4534 Department of Management Services to request a private
4535 letter ruling from the United States Internal Revenue
4536 Service regarding this act; providing for
4537 severability; providing effective dates.