Senate Bill 1684c1

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



    Florida Senate - 1998                           CS for SB 1684

    By the Committee on Governmental Reform and Oversight





    302-1820-98

  1                      A bill to be entitled

  2         An act relating to the Florida Retirement

  3         System (RAB); clarifying provisions throughout

  4         ch. 121, F.S., relating to vesting and the

  5         normal retirement date for a member; amending

  6         s. 121.021, F.S., relating to definitions;

  7         revising and adding definitions; amending s.

  8         121.051, F.S., relating to participation in the

  9         Florida Retirement System; providing that

10         consultants and independent contractors are

11         ineligible to participate; establishing

12         procedures and requirements for municipalities

13         or special districts that choose to participate

14         in the Florida Retirement System; providing

15         requirements for employers that transfer,

16         merge, or consolidate governmental services or

17         functions; limiting a member's rights following

18         a conviction for causing a shortage in a public

19         account; providing requirements and limitations

20         for a member who is dually employed; amending

21         s. 121.0515, F.S., relating to Special Risk

22         Class membership; providing for retroactive

23         membership in certain cases; requiring certain

24         members who are moved or reassigned to

25         participate in the Special Risk Administrative

26         Support Class; amending s. 121.052, F.S.,

27         relating to the Elected State and County

28         Officers' Class; providing for calculating

29         average final compensation; amending s.

30         121.053, F.S., relating to retired member

31         participation in the Elected State and County

                                  1

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         Officers' Class; clarifying requirements for

  2         creditable service; amending s. 121.055, F.S.,

  3         relating to the Senior Management Service

  4         Optional Annuity Program; clarifying

  5         participation requirements; providing for the

  6         Optional Annuity Program Trust Fund; providing

  7         eligibility requirements for receiving

  8         benefits; providing for administering the

  9         program; providing requirements and limitations

10         for a member who is dually employed; amending

11         s. 121.071, F.S., relating to system

12         contributions; providing requirements for

13         contributions for other creditable service;

14         amending s. 121.081, F.S., relating to

15         contributions for past service or prior

16         service; clarifying provisions with respect to

17         required contributions; providing requirements

18         for receiving service credit and prior service

19         credit; amending s. 121.091, F.S., relating to

20         benefits payable under the Florida Retirement

21         System; providing for cancellation of

22         application for retirement benefits; clarifying

23         and consolidating benefit provisions; providing

24         procedures for determining average final

25         compensation; providing for determining

26         disability retirement benefits; providing for

27         optional forms of retirement benefits and

28         disability retirement benefits; providing

29         requirements for determining death benefits;

30         providing for designating beneficiaries;

31         providing for the payment of benefits;

                                  2

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         authorizing certain deductions from the monthly

  2         benefit payment; amending s. 121.111, F.S.,

  3         relating to credit for military service;

  4         providing requirements for determining

  5         creditable service; amending s. 121.121, F.S.;

  6         providing requirements for purchasing

  7         creditable service for authorized leaves of

  8         absence; amending s. 121.122, F.S., relating to

  9         renewed membership; clarifying requirements for

10         a member who does not claim credit for all

11         postretirement service; creating s. 121.193,

12         F.S., relating to external compliance audits;

13         providing responsibilities of the Division of

14         Retirement of the Department of Management

15         Services with respect to such audits;

16         specifying requirements of participating

17         agencies; amending s. 121.35, F.S., relating to

18         the Optional Retirement Program for the State

19         University System; providing for the

20         application of certain federal requirements;

21         providing for the administration of the

22         Optional Retirement Program Trust Fund;

23         clarifying benefit requirements; providing for

24         responsibilities of the Board of Regents and

25         institutions in the State University System;

26         amending s. 121.40, F.S., relating to the

27         supplemental retirement benefits provided for

28         certain personnel at the Institute of Food and

29         Agricultural Sciences at the University of

30         Florida; providing for the deduction of certain

31         payments from the monthly benefit payment;

                                  3

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         providing legislative intent with respect to

  2         the amendments made by the act; providing an

  3         effective date.

  4

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

  6

  7         Section 1.  Subsection (29) of section 121.021, Florida

  8  Statutes, as amended by chapters 97-154 and 97-180, Laws of

  9  Florida, is amended, and subsection (45) is added to that

10  section, to read:

11         121.021  Definitions.--The following words and phrases

12  as used in this chapter have the respective meanings set forth

13  unless a different meaning is plainly required by the context:

14         (29)  "Normal retirement date" means the first day of

15  any month following the date a member attains one of the

16  following statuses:

17         (a)  If a Regular Class member, the member:

18         1.  Completes 10 or more years of creditable service

19  and attains age 62; or

20         2.(b)  Completes 30 years of creditable service,

21  regardless of age, which may include a maximum of 4 years of

22  military service credit as, so long as such credit is not

23  claimed under any other system., regardless of age;

24         (b)(c)  If a Special Risk Class member, the member:

25         1.  Completes 10 or more years of creditable service in

26  the Special Risk Class and attains age 55;

27         2.  Completes 25 years of creditable service in the

28  Special Risk Class, regardless of age; or

29         3.  Completes 25 years of creditable service and

30  attains age 52, which service may include a maximum of 4 years

31  of military service credit as long as such credit is not

                                  4

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  claimed under any other system and the remaining years are in

  2  the Special Risk Class., and attains age 52; or

  3         (c)(d)  If a Senior Management Service Class member:

  4         1.  Completes 7 years of creditable service in the

  5  Senior Management Service Class and attains age 62; or

  6         2.  Completes 30 years of any creditable service,

  7  regardless of age, which may include a maximum of 4 years of

  8  military service credit, regardless of age as long as such

  9  credit is not claimed under any other system.

10         (d)  If an Elected State and County Officers' Class

11  member, the member:

12         1.  Completes 8 years of creditable service in the

13  Elected State and County Officers' Class and attains age 62;

14  or

15         2.  Completes 30 years of any creditable service,

16  regardless of age, which may include a maximum of 4 years of

17  military service credit as long as such credit is not claimed

18  under any other system.

19

20  "Normal retirement age" is attained on the "normal retirement

21  date."

22         (45)  "Vested" or "vesting" means the guarantee that a

23  member is eligible to receive a future retirement benefit upon

24  completion of the required years of creditable service for the

25  employee's class of membership, even though the member may

26  have terminated covered employment before reaching normal or

27  early retirement age. Being vested does not entitle a member

28  to a disability benefit based on a disability caused by an

29  injury or disease that occurs after termination of covered

30  employment.

31

                                  5

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         Section 2.  Paragraphs (a) and (d) of subsection (1),

  2  paragraph (b) of subsection (2), and paragraph (b) of

  3  subsection (5) of section 121.051, Florida Statutes, are

  4  amended, paragraph (f) is added to subsection (2) of that

  5  section, and subsection (9) is added to that section, to read:

  6         121.051  Participation in the system.--

  7         (1)  COMPULSORY PARTICIPATION.--

  8         (a)  The provisions of this law shall be compulsory as

  9  to all officers and employees, except elected officers who

10  meet the requirements of s. 121.052(3), who are employed on or

11  after December 1, 1970, of an employer other than those

12  referred to in paragraph (2)(b), and each officer or employee,

13  as a condition of employment, shall become a member of the

14  system as of his or her date of employment, except that a

15  person who is retired from any state retirement system and is

16  reemployed on or after December 1, 1970, shall not be

17  permitted to renew his or her membership in any state

18  retirement system except as provided in s. 121.091(4)(h) s.

19  121.091(4)(e) for a person who recovers from disability, and

20  as provided in s. 121.091(9)(b)8. for a person who is elected

21  to public office, and, effective July 1, 1991, as provided in

22  s. 121.122 for all other retirees.  Officers and employees of

23  the University Athletic Association, Inc., a nonprofit

24  association connected with the University of Florida, employed

25  on and after July 1, 1979, shall not participate in any

26  state-supported retirement system.  Any person appointed on or

27  after July 1, 1989, to a faculty position in a college at the

28  J. Hillis Miller Health Center at the University of Florida or

29  the Medical Center at the University of South Florida which

30  has a faculty practice plan provided by rule adopted by the

31  Board of Regents shall not participate in the Florida

                                  6

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  Retirement System.  A faculty member so appointed shall

  2  participate in the optional retirement program on the basis of

  3  his or her state-funded compensation, notwithstanding the

  4  provisions of s. 121.35(2)(a).

  5         (d)  The following persons are not eligible to

  6  participate in the Florida Retirement System:

  7         1.  Employees of a not-for-profit corporation or

  8  association created by the Board of County Commissioners of

  9  Palm Beach County for the purpose of owning, operating, or

10  managing a public bus transit system formerly operated or

11  managed by a private corporation subject to 49 U.S.C. s.

12  5333(b), shall not be eligible to participate in the Florida

13  Retirement System.

14         2.  Persons who perform services as a consultant or an

15  independent contractor, as defined by the division.

16         (2)  OPTIONAL PARTICIPATION.--

17         (b)1.  The governing body of any municipality city or

18  special district in the state may elect to participate in the

19  system upon proper application to the administrator and may

20  cover all or any of its units as approved by the Secretary of

21  Health and Human Services and the administrator. Prior to

22  being approved for participation in the Florida Retirement

23  System, the governing body of any such municipality or special

24  district that has a local retirement system shall submit to

25  the administrator a certified financial statement showing the

26  condition of the local retirement system as of a date within 3

27  months prior to the proposed effective date of membership in

28  the Florida Retirement System. The statement must be certified

29  by a recognized accounting firm that is independent of the

30  local retirement system. All required documents necessary for

31  extending Florida Retirement System coverage must be received

                                  7

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  by the division for consideration at least 15 days prior to

  2  the proposed effective date of coverage. If the municipality

  3  or special district does not comply with this requirement, the

  4  division may require that the effective date of coverage be

  5  changed.

  6         2.  Any city or special district that has an existing

  7  retirement system covering the employees in the units that are

  8  to be brought under the Florida Retirement System may

  9  participate only after holding a referendum in which all

10  employees in the affected units have the right to participate.

11  Only those employees electing coverage under the Florida

12  Retirement System by affirmative vote in said referendum shall

13  be eligible for coverage under this chapter, and those not

14  participating or electing not to be covered by the Florida

15  Retirement System shall remain in their present systems and

16  shall not be eligible for coverage under this chapter. After

17  the referendum is held, all future employees shall be

18  compulsory members of the Florida Retirement System.

19         3.  The governing body of any city or special district

20  complying with subparagraph 1. may elect to provide, or not

21  provide, benefits based on past service of officers and

22  employees as described in s. 121.081(1). However, if such

23  employer elects to provide past service benefits, such

24  benefits must be provided for all officers and employees of

25  its covered group.

26         4.  Once this election is made and approved it may not

27  be revoked, except pursuant to subparagraphs 5. and 6., and

28  all present officers and employees electing coverage under

29  this chapter and all future officers and employees shall be

30  compulsory members of the Florida Retirement System.

31

                                  8

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         5.  Subject to the conditions set forth in subparagraph

  2  6., the governing body of any hospital licensed under chapter

  3  395 which is governed by the board of a special district as

  4  defined in s. 189.403(1) or by the board of trustees of a

  5  public health trust created under s. 154.07, hereinafter

  6  referred to as "hospital district," and which participates in

  7  the system, may elect to cease participation in the system

  8  with regard to future employees in accordance with the

  9  following procedure:

10         a.  No more than 30 days and at least 7 days before

11  adopting a resolution to partially withdraw from the Florida

12  Retirement System and establish an alternative retirement plan

13  for future employees, a public hearing must be held on the

14  proposed withdrawal and proposed alternative plan.

15         b.  From 7 to 15 days before such hearing, notice of

16  intent to withdraw, specifying the time and place of the

17  hearing, must be provided in writing to employees of the

18  hospital district proposing partial withdrawal and must be

19  published in a newspaper of general circulation in the area

20  affected, as provided by ss. 50.011-50.031.  Proof of

21  publication of such notice shall be submitted to the Division

22  of Retirement.

23         c.  The governing body of any hospital district seeking

24  to partially withdraw from the system must, before such

25  hearing, have an actuarial report prepared and certified by an

26  enrolled actuary, as defined in s. 112.625(3), illustrating

27  the cost to the hospital district of providing, through the

28  retirement plan that the hospital district is to adopt,

29  benefits for new employees comparable to those provided under

30  the Florida Retirement System.

31

                                  9

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         d.  Upon meeting all applicable requirements of this

  2  subparagraph, and subject to the conditions set forth in

  3  subparagraph 6., partial withdrawal from the system and

  4  adoption of the alternative retirement plan may be

  5  accomplished by resolution duly adopted by the hospital

  6  district board.  The hospital district board must provide

  7  written notice of such withdrawal to the division by mailing a

  8  copy of the resolution to the division, postmarked no later

  9  than December 15, 1995.  The withdrawal shall take effect

10  January 1, 1996.

11         6.  Following the adoption of a resolution under

12  sub-subparagraph 5.d., all employees of the withdrawing

13  hospital district who were participants in the Florida

14  Retirement System prior to January 1, 1996, shall remain as

15  participants in the system for as long as they are employees

16  of the hospital district, and all rights, duties, and

17  obligations between the hospital district, the system, and the

18  employees shall remain in full force and effect. Any employee

19  who is hired or appointed on or after January 1, 1996, may not

20  participate in the Florida Retirement System, and the

21  withdrawing hospital district shall have no obligation to the

22  system with respect to such employees.

23         (f)  Whenever an employer that participates in the

24  Florida Retirement System undertakes the transfer, merger, or

25  consolidation of governmental services or functions, the

26  employer must notify the division at least 60 days prior to

27  such action and shall provide documentation as required by the

28  division.

29         (5)  RIGHTS LIMITED.--

30         (b)  A No member who is convicted by a court of

31  competent jurisdiction of causing has caused a shortage in a

                                  10

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  public account, when such shortage is certified by the Auditor

  2  General or a certified public accountant, may not retire or

  3  receive any benefits under this chapter so long as such

  4  shortage exists.

  5         (9)  DUAL EMPLOYMENT.--A member may not participate in

  6  more than one state-administered retirement system, plan, or

  7  class of membership simultaneously. Pursuant thereto:

  8         (a)  With respect to any member who is not eligible to

  9  participate in the Elected State and County Officers' Class,

10  but who is simultaneously employed in two or more positions

11  covered by different Florida Retirement System classes:

12         1.  The member must participate in the membership class

13  for the position in which he or she is employed the majority

14  of the time: the Regular Class, Senior Management Service

15  Class, Special Risk Class, or Special Risk Administrative

16  Support Class; or

17         2.  If the employment is split equally between or among

18  positions, the member may choose any single class of

19  membership for which he or she is eligible, whether or not the

20  positions are full-time positions. The member's choice must be

21  made in writing and remains in effect as long as the member is

22  employed equally in two or more positions.

23         (b)  Contributions shall be made and creditable service

24  shall be determined as follows:

25         1.  If the member is participating in the Regular

26  Class, retirement contributions shall be made on the total

27  salary the member has received for all covered employment, and

28  at retirement the member's average final compensation shall be

29  calculated on the total salary received from all covered

30  employment.

31

                                  11

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         2.  If the member is participating in the Senior

  2  Management Service Class, Special Risk Class, or Special Risk

  3  Administrative Support Class, retirement contributions shall

  4  be made only on the salary received in the designated class of

  5  membership. At retirement, the member's average final

  6  compensation shall be based only on the salary received in the

  7  designated class of membership for any period, including any

  8  period of dual employment.

  9         Section 3.  Paragraph (a) of subsection (3) and

10  subsection (7) of section 121.0515, Florida Statutes, are

11  amended to read:

12         121.0515  Special risk membership; criteria;

13  designation and removal of classification; credits for past

14  service and prior service; retention of special risk normal

15  retirement date.--

16         (3)  PROCEDURE FOR DESIGNATING.--

17         (a)  Any member of the Florida Retirement System

18  employed by a county, city, or special district who feels that

19  he or she meets the criteria set forth in this section for

20  membership in the Special Risk Class may request that his or

21  her employer submit an application to the division requesting

22  that the division designate him or her as a special risk

23  member.  If the employer agrees that the member meets the

24  requirements for special risk membership, the employer shall

25  submit an application to the division in behalf of the

26  employee containing a certification that the member meets the

27  criteria for special risk membership set forth in this section

28  and such other supporting documentation as may be required by

29  administrative rule.  The division shall, within 90 days,

30  either designate or refuse to designate the member as a

31  special risk member.  If the employer declines to submit the

                                  12

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  member's application to the division or if the division does

  2  not designate the member as a special risk member, the member

  3  or the employer may appeal to the State Retirement Commission,

  4  as provided in s. 121.23, for designation as a special risk

  5  member. A member who receives a final affirmative ruling

  6  pursuant to such appeal for special risk membership shall have

  7  special risk membership retroactive to the date such member

  8  would have had special risk membership had such membership

  9  been approved by the employer and the division, as determined

10  by the division, and the employer contributions shall be paid

11  in full within 1 year after such final ruling.

12         (7)  RETENTION OF SPECIAL RISK NORMAL RETIREMENT

13  DATE.--

14         (a)  A special risk member who is moved or reassigned

15  to a nonspecial risk law enforcement, firefighting, or

16  correctional administrative support position with the same

17  agency, or who is subsequently employed in such a position

18  with any law enforcement, firefighting, or correctional agency

19  under the Florida Retirement System, shall participate in the

20  Special Risk Administrative Support Class and shall earn

21  credit for such service at the same percentage rate as that

22  earned by a regular member.  Notwithstanding the provisions of

23  subsection (4), service in such an administrative support

24  position shall, for purposes of s. 121.091, apply toward

25  satisfaction of the special risk normal retirement date, as

26  defined in s. 121.021(29)(b) s. 121.021(29)(c), provided that,

27  while in such position, the member remains certified as a law

28  enforcement officer, firefighter, or correctional officer;

29  remains subject to reassignment at any time to a position

30  qualifying for special risk membership; and completes an

31

                                  13

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  aggregate of 10 or more years of service as a designated

  2  special risk member prior to retirement.

  3         (b)  Upon application by a member, the provisions of

  4  this subsection shall apply, with respect to such member,

  5  retroactively to October 1, 1978.

  6         (c)  The division shall adopt such rules as are

  7  required to administer this subsection.

  8         Section 4.  Subsection (9) and paragraph (c) of

  9  subsection (12) of section 121.052, Florida Statutes, are

10  amended to read:

11         121.052  Membership class of elected state and county

12  officers.--

13         (9)  AVERAGE FINAL COMPENSATION.--The average final

14  compensation of a member of the Elected State and County

15  Officers' Class shall be as defined in s. 121.021(24). If a

16  member has received credit for upgraded previous Elected State

17  and County Officers' Class service as provided in subsection

18  (5), and the upgraded service salary is greater than his or

19  her actual salary, the upgraded service salary shall be used

20  to calculate the member's average final compensation.

21         (12)  BENEFITS.--

22         (c)  The benefit provisions of s. 121.091(7), relating

23  to death benefits, shall apply to members of the Elected State

24  and County Officers' Class and shall be construed in such

25  manner as to make them compatible with the provisions of this

26  section; however, only 8 years of creditable service in this

27  class are needed to obtain such benefits, except that:

28         1.  If In the event any elected official dies in office

29  who would have been vested under had 8 years of creditable

30  service in the Elected State and County Officers' Class, or 10

31  years of creditable service in any other class of the Florida

                                  14

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  Retirement System, or any other state-administered retirement

  2  system, if the official had lived to complete his or her term

  3  of office, the official's spouse may elect to leave the

  4  official's retirement contributions in the retirement trust

  5  fund and pay into said fund any required contributions which

  6  would have been paid by the officer or the employer had the

  7  officer lived to complete the term of office.

  8         2.  If a deceased member's surviving spouse as

  9  described in subparagraph 1. previously received a refund of

10  the member's contributions made to the retirement trust fund,

11  the surviving spouse may pay into the retirement trust fund an

12  amount equal to the deceased member's contributions previously

13  refunded, together with interest at 4 percent compounded

14  annually on the amount of such refunded contributions from the

15  date of refund until July 1, 1975, and at 6.5 percent

16  compounded annually thereafter to the date of payment, plus

17  such additional contributions as may be required under

18  subparagraph 1., in order to become vested qualify for 8 or 10

19  years of creditable service, as applicable.

20

21  Upon conclusion of the term of office to which the deceased

22  officer was elected, a spouse who pays into the retirement

23  trust fund such additional or refunded contributions, plus

24  interest, shall be eligible to receive a monthly benefit in

25  the same manner as the surviving spouse of a member who dies

26  after accumulating the required number of years of creditable

27  service as described herein.

28         Section 5.  Paragraph (b) of subsection (1) of section

29  121.053, Florida Statutes, is amended to read:

30         121.053  Participation in the Elected State and County

31  Officers' Class for retired members.--

                                  15

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         (1)

  2         (b)  Any retired member of the Florida Retirement

  3  System, or any existing system as defined in s. 121.021(2),

  4  who, on or after July 1, 1990, is serving in, or is elected or

  5  appointed to, an elective office covered by the Elected State

  6  and County Officers' Class shall be enrolled in the

  7  appropriate subclass of the Elected State and County Officers'

  8  Class of the Florida Retirement System, and applicable

  9  contributions shall be paid into the Florida Retirement System

10  Trust Fund as provided in s. 121.052(7).  Pursuant thereto:

11         1.  Any such retired member shall be eligible to

12  continue to receive retirement benefits as well as

13  compensation for the elected officer service for as long as he

14  or she remains in an elective office covered by the Elected

15  State and County Officers' Class.

16         2.  If any such member serves in an elective office

17  covered by the Elected State and County Officers' Class and

18  becomes vested under that class for a period of at least 8

19  years, he or she shall be entitled to receive an additional

20  retirement benefit for such elected officer service.

21         3.  Such member shall be entitled to purchase

22  additional retirement credit in the Elected State and County

23  Officers' Class for any postretirement service performed in an

24  elected position eligible for the Elected State and County

25  Officers' Class prior to July 1, 1990, or in the Regular Class

26  for any postretirement service performed in any other

27  regularly established position prior to July 1, 1991, by

28  paying the applicable Elected State and County Officers' Class

29  or Regular Class employee and employer contributions for the

30  period being claimed, plus 4 percent interest compounded

31  annually from the first year of service claimed until July 1,

                                  16

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  1975, and 6.5 percent interest compounded thereafter, until

  2  full payment is made to the Florida Retirement System Trust

  3  Fund. The contribution for postretirement Regular Class

  4  service between July 1, 1985, and July 1, 1991, for which the

  5  reemployed retiree contribution was paid, shall be the

  6  difference between such contribution and the total applicable

  7  contribution for the period being claimed, plus interest. The

  8  employer of such member may pay the applicable employer

  9  contribution in lieu of the member. If a member does not wish

10  to claim credit for all of the postretirement service for

11  which he or she is eligible, the service the member claims

12  must be the most recent service.

13         4.  No Creditable service for which credit was

14  received, or which remained unclaimed, at retirement may not

15  be claimed or applied toward service credit earned following

16  renewed membership. However, service earned in accordance with

17  the renewed membership provisions in s. 121.122 may be used in

18  conjunction with creditable service earned under this

19  paragraph, provided applicable vesting requirements and other

20  existing statutory conditions required by this chapter are

21  met.

22         Section 6.  Subsection (6) of section 121.055, Florida

23  Statutes, is amended to read:

24         121.055  Senior Management Service Class.--There is

25  hereby established a separate class of membership within the

26  Florida Retirement System to be known as the "Senior

27  Management Service Class," which shall become effective

28  February 1, 1987.

29         (6)(a)  Senior Management Service Optional Annuity

30  Program.--The Department of Management Services shall

31  establish a Senior Management Service Optional Annuity Program

                                  17

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  under which contracts providing retirement, death, and

  2  disability benefits may be purchased for those employees who

  3  elect to participate in the optional annuity program.  The

  4  benefits to be provided for or on behalf of participants in

  5  such optional annuity program shall be provided through

  6  individual contracts or individual certificates issued for

  7  group annuity contracts, which may be fixed, variable, or a

  8  combination thereof, in accordance with s. 401(a) of the

  9  Internal Revenue Code.  Any such individual contract or

10  certificate shall state the annuity plan on its face page, and

11  shall include, but not be limited to, a statement of

12  ownership, the contract benefits, annuity income options,

13  limitations, expense charges, and surrender charges, if any.

14  The employing agency shall contribute, as provided in this

15  section, toward the purchase of such optional benefits which

16  shall be fully and immediately vested in the participants.

17         (b)  Retirement service credit.--An eligible employee

18  who is a member of the Florida Retirement System or an

19  existing retirement system at the time of his or her election

20  to participate in the Senior Management Service Optional

21  Annuity Program shall retain all retirement service credit

22  earned under the retirement system from which he or she

23  transferred; however, no additional service credit in the

24  Florida Retirement System or existing retirement system shall

25  be earned while the employee participates in the optional

26  annuity program, nor shall the employee be eligible for

27  disability retirement under the Florida Retirement System or

28  existing retirement system.

29         (c)  Participation.--

30         1.  Any eligible employee who is employed on or before

31  February 1, 1987, may elect to participate in the optional

                                  18

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  annuity program in lieu of participation in the Senior

  2  Management Service Class.  Such election shall be made in

  3  writing and filed with the department and the personnel

  4  officer of the employer on or before May 1, 1987.  Any

  5  eligible employee who is employed on or before February 1,

  6  1987, and who fails to make an election to participate in the

  7  optional annuity program by May 1, 1987, shall be deemed to

  8  have elected membership in the Senior Management Service

  9  Class.

10         2.  Any employee who becomes eligible to participate in

11  the optional annuity program by reason of initial employment

12  commencing after February 1, 1987, may, within 90 days after

13  the date of commencement of employment, elect to participate

14  in the optional annuity program.  Such election shall be made

15  in writing and filed with the personnel officer of the

16  employer.  Any eligible employee who does not within 90 days

17  after commencement of such employment elect to participate in

18  the optional annuity program shall be deemed to have elected

19  membership in the Senior Management Service Class.

20         3.  A person who is appointed to a position in the

21  Senior Management Service Class and who is a member of an

22  existing retirement system or the Special Risk or Special Risk

23  Administrative Support Classes of the Florida Retirement

24  System may elect to remain in such system or class in lieu of

25  participation in the Senior Management Service Class or

26  optional annuity program. Such election shall be made in

27  writing and filed with the department and the personnel

28  officer of the employer within 90 days of such appointment.

29  Any eligible employee who fails to make an election to

30  participate in the existing system, the Special Risk Class of

31  the Florida Retirement System, the Special Risk Administrative

                                  19

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  Support Class of the Florida Retirement System, or the

  2  optional annuity program shall be deemed to have elected

  3  membership in the Senior Management Service Class.

  4         4.  An employee's election to participate in the

  5  Optional Annuity Program is irrevocable as long as such

  6  employee continues to be employed in an eligible position and

  7  continues to meet the eligibility requirements set forth in

  8  this paragraph.

  9         (d)  Contributions.--

10         1.  Each employer shall contribute on behalf of each

11  participant in the Senior Management Service Optional Annuity

12  Program an amount equal to the normal cost portion of the

13  employer retirement contribution which would be required if

14  the participant were a Senior Management Service Class member

15  of the Florida Retirement System, plus the portion of the

16  contribution rate required in s. 112.363(8) that would

17  otherwise be assigned to the Retiree Health Insurance Subsidy

18  Trust Fund, less an amount approved by the Legislature which

19  shall be deducted by the division to provide for the

20  administration of this program. The payment of the

21  contributions to the optional program which is required by

22  this subparagraph for each participant shall be made by the

23  employer to the division which shall forward the contributions

24  to the designated company or companies contracting for payment

25  of benefits for the participant under the program.

26         2.  Each employer shall contribute on behalf of each

27  participant in the Senior Management Service Optional Annuity

28  Program an amount equal to the unfunded actuarial accrued

29  liability portion of the employer contribution which would be

30  required for members of the Senior Management Service Class in

31  the Florida Retirement System.  This contribution shall be

                                  20

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  paid to the division for transfer to the Florida Retirement

  2  System Trust Fund.

  3         3.  An Optional Annuity Program Trust Fund shall be

  4  established in the State Treasury and administered by the

  5  division to make payments to provider companies on behalf of

  6  the Optional Annuity Program participants, and to transfer the

  7  unfunded liability portion of the state optional annuity

  8  program contributions to the Florida Retirement System Trust

  9  Fund.

10         4.3.  Contributions required for social security by

11  each employer and each participant, in the amount required for

12  social security coverage as now or hereafter may be provided

13  by the federal Social Security Act shall be maintained for

14  each participant in the Senior Management Service retirement

15  program and shall be in addition to the retirement

16  contributions specified in this paragraph.

17         5.4.  Each participant in the Senior Management Service

18  Optional Annuity Program may contribute by way of salary

19  reduction or deduction a percentage amount of the

20  participant's gross compensation not to exceed the percentage

21  amount contributed by the employer to the optional annuity

22  program. Payment of the participant's contributions shall be

23  made by the employer to the division which shall forward the

24  contributions to the designated company or companies

25  contracting for payment of benefits for the participant under

26  the program.

27         (e)  Benefits.--

28         1.  Benefits shall be payable under the Senior

29  Management Service Optional Annuity Program only to

30  participants in the program, or their beneficiaries as

31  designated by the participant in the contract with a provider

                                  21

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  company, and such benefits shall be paid by the designated

  2  company in accordance with the terms of the annuity contract

  3  or contracts applicable to the participant. A participant must

  4  be terminated from all employment with all Florida Retirement

  5  System employers as provided in s. 121.021(39) to begin

  6  receiving the employer-funded benefit. Benefits funded by

  7  employer contributions shall be payable only as a lifetime

  8  annuity to the participant, his beneficiary, or his estate,

  9  except for:

10         a.  A lump-sum payment to the beneficiary upon the

11  death of the participant; or

12         b.  A cash-out of a de minimis account upon the request

13  of a former participant who has been terminated for a minimum

14  of 6 months from the employment that entitled him to Optional

15  Retirement Program participation. A de minimis account is an

16  account with a provider company containing employer

17  contributions and accumulated earnings of not more than $3,500

18  made under the provisions of this chapter. Such cash-out must

19  be a complete liquidation of the account balance with that

20  company and is subject to the provisions of the Internal

21  Revenue Code.

22         2.  The benefits payable to any person under the Senior

23  Management Service Optional Annuity Program, and any

24  contribution accumulated under such program, shall not be

25  subject to assignment, execution, or attachment or to any

26  legal process whatsoever.

27         3.  A participant who receives Optional Annuity Program

28  benefits funded by employer contributions shall be deemed to

29  be retired from a state-administered retirement system in the

30  event of subsequent employment with any employer that

31  participates in the Florida Retirement System.

                                  22

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         (f)  Administration.--

  2         1.  The Senior Management Service Optional Annuity

  3  Program authorized by this section shall be administered by

  4  the Division of Retirement.  The division shall designate one

  5  or more provider companies from which annuity contracts may be

  6  purchased under the program and shall approve the form and

  7  content of the contracts. The division shall sign a contract

  8  with each of the provider companies and shall evaluate the

  9  performance of the provider companies on a continuing basis.

10  The division may terminate the services of a provider company

11  for reasons stated in the contract. The division shall adopt

12  rules establishing its responsibilities and the

13  responsibilities of employers in administering the optional

14  annuity program.

15         2.  Effective July 1, 1997, the State Board of

16  Administration shall review and make recommendations to the

17  division on the acceptability of all investment products

18  proposed by provider companies of the optional annuity program

19  before such products are offered through annuity contracts to

20  the participants and may advise the division of any changes

21  deemed necessary to ensure that the optional annuity program

22  offers an acceptable mix of investment products. The division

23  shall make the final determination as to whether an investment

24  product will be approved for the program.

25         3.  The provisions of each contract applicable to a

26  participant in the Senior Management Service Optional Annuity

27  Program shall be contained in a written program description

28  which shall include a report of pertinent financial and

29  actuarial information on the solvency and actuarial soundness

30  of the program and the benefits applicable to the participant.

31  Such description shall be furnished by the company or

                                  23

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  companies to each participant in the program and to the

  2  division upon commencement of participation in the program and

  3  annually thereafter.

  4         4.  The division shall ensure that each participant in

  5  the Senior Management Service Optional Annuity Program is

  6  provided an accounting of the total contribution and the

  7  annual contribution made by and on behalf of such

  8  participants.

  9         (g)  A participant in the Optional Annuity Program may

10  not participate in more than one state-administered retirement

11  system, plan, or class simultaneously. The following shall

12  apply to a participant who is or becomes dually employed:

13         1.  A participant who is or becomes dually employed in

14  two or more positions covered by the Florida Retirement

15  System, one of which is eligible for the Optional Annuity

16  Program and one of which is not, shall make one of the

17  following choices:

18         a.  Remain a member of the Optional Annuity Program, in

19  which case contributions shall be paid as required only on the

20  salary earned in the position eligible for the Optional

21  Annuity Program during the period of dual employment;

22         b.  Elect, within 90 days after becoming dually

23  employed, membership in the Regular Class of the Florida

24  Retirement System in lieu of the Optional Annuity Program, in

25  which case contributions shall be paid as required on the

26  total salary received for all employment, and, at retirement,

27  the member's average final compensation used to calculate any

28  benefits for which he or she becomes eligible under the

29  Florida Retirement System shall be based on all salary

30  reported for all covered positions during the period of dual

31  employment; or

                                  24

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         c.  If dually employed in an elected office eligible

  2  for the Elected State and County Officers' Class, select,

  3  within 6 months after assuming office, membership in the

  4  Elected State and County Officers' Class, in which case,

  5  participation in the Optional Annuity Program shall cease for

  6  the period of dual employment, retirement contributions shall

  7  be paid as required only on the salary earned as an elected

  8  officer, and, at retirement, the member's benefit under the

  9  Florida Retirement System shall be based only on the salary

10  received as an elected officer for the period of dual

11  employment.

12         2.  When such member ceases to be dually employed, he

13  or she shall make one of the following choices:

14         a.  If the position in which he or she remains is a

15  position that is eligible for the Optional Annuity Program, he

16  or she may, within 90 days after ceasing dual employment,

17  elect to remain in the Florida Retirement System class for

18  which he or she is eligible or to again become a participant

19  in the Optional Annuity Program. Failure to elect membership

20  in the Optional Annuity Program within 90 days shall result in

21  compulsory membership in the Florida Retirement System; or

22         b.  If the position in which he or she remains is not a

23  position that is eligible for the Optional Annuity Program, he

24  or she shall participate in the Florida Retirement System

25  class for which he or she is eligible.

26         Section 7.  Subsection (6) is added to section 121.071,

27  Florida Statutes, to read:

28         121.071  Contributions.--Contributions to the system

29  shall be made as follows:

30         (6)(a)  Required employee contributions for all service

31  other than current service, including, but not limited to,

                                  25

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  prior service, past service, military service,

  2  leave-of-absence service, out-of-state service, and certain

  3  non-Florida Retirement System in-state service, shall be paid

  4  by cash, personal check, cashier's check, or money order only;

  5  shall be accompanied by a statement identifying the service

  6  for which payment is made; and shall be made in a lump sum for

  7  the total amount due or in annual payments of not less than

  8  $100, except for the final payment if less than $100, unless

  9  another method of payment is authorized by law or rule.

10         (b)  On and after July 1, 1972, all remittances made by

11  a member for the purchase of optional creditable service shall

12  be credited to the member's account. A refund of a member's

13  retirement contributions at termination, as provided in

14  paragraph (2)(b), shall include all such remittances made by

15  the member and credited to his or her account. If requested, a

16  member may, at the time of retirement, receive a refund of any

17  contributions he or she made for the purchase of any optional

18  creditable service. A member is not entitled to a refund of

19  contributions paid by an employer, except for employee

20  contributions made by an employer for an employee's past

21  service earned prior to October 1, 1975.

22         (c)  By obtaining a refund of contributions, a member

23  waives all rights under the Florida Retirement System to the

24  service credit represented by the refunded contributions,

25  except the right to purchase his or her prior service credit

26  in accordance with s. 121.081(2).

27         (d)  The contributions required of a member of the

28  Teachers' Retirement System who transfers to the Florida

29  Retirement System must be adjusted, based on the rate of 6.25

30  percent of salary earned while a member of the Teachers'

31  Retirement System. Any overpayment that results from this

                                  26

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  adjustment will be refunded to the member, while any amount

  2  due, plus interest compounded annually, must be paid by the

  3  member prior to retirement. Effective upon the date of

  4  transfer to the Florida Retirement System, contributions shall

  5  be paid as required under this chapter.

  6         Section 8.  Paragraphs (f) and (h) of subsection (1)

  7  and paragraph (a) of subsection (2) of section 121.081,

  8  Florida Statutes, are amended, and paragraphs (e) and (f) are

  9  added to subsection (2) of that section, to read:

10         121.081  Past service; prior service;

11  contributions.--Conditions under which past service or prior

12  service may be claimed and credited are:

13         (1)

14         (f)  When any person, either prior to this act or

15  hereafter, becomes entitled to and does participate in one of

16  the retirement systems consolidated within or created by this

17  chapter through the consolidation or merger of governments or

18  the transfer of functions between units of government, either

19  at the state or local level or between state and local units,

20  or through the assumption of functions or activities by a

21  state or local unit from an employing entity which was not an

22  employer under the system, and such person becomes a member of

23  the Florida Retirement System, such person shall be entitled

24  to receive past-service credit as defined in s. 121.021(18)

25  for the time such person performed services for, and was an

26  employee of, such state or local unit or other employing

27  entity prior to the transfer, merger, consolidation, or

28  assumption of functions and activities. Past-service credit

29  allowed by this paragraph shall also be available to any

30  person those persons who becomes a member became members of an

31  existing system, as defined in s. 121.021(2), prior to

                                  27

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  December 1, 1970, through the transfer, merger, consolidation,

  2  or assumption of functions and activities set forth in this

  3  paragraph and who subsequently becomes a member become members

  4  of the Florida Retirement System. However, in no event will

  5  credit for the past service may not be granted until

  6  contributions are made in the manner provided in this

  7  subsection. If a person rejected Florida Retirement System

  8  membership at the time of the transfer, merger, or

  9  consolidation, the required contributions shall be at total

10  actuarial cost as specified in paragraph (e). Such

11  contributions or and accrued interest may shall not be paid

12  from any state funds.

13         (h)  The following provisions apply to the purchase of

14  past service:

15         1.  Notwithstanding any of the provisions of this

16  subsection, no past-service credit may not be purchased under

17  this chapter for any service that which is used to obtain a

18  benefit from any local retirement system.

19         2.  A member may not receive past service credit under

20  paragraphs (a), (b), (e), or (f) for any leaves of absence

21  without pay, except that credit for active military service

22  leaves of absence may be claimed under paragraphs (a), (b),

23  and (f), in accordance with s. 121.111(1).

24         3.  If a member does not desire to receive credit for

25  all of his or her past service, the period the member claims

26  must be the most recent past service prior to his or her

27  participation in the Florida Retirement System.

28         4.  The cost of past service purchased by an employing

29  agency for its employees may be amortized over such period of

30  time as is provided in the agreement, but not to exceed 15

31

                                  28

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  years, calculated in accordance with rule 60S-1.007(5)(f),

  2  Florida Administrative Code.

  3         5.  The retirement account of each member for whom past

  4  service is being provided by his or her employer shall be

  5  credited with all past service the employer agrees to purchase

  6  as soon as the agreement between the employer and the division

  7  is executed. Pursuant thereto:

  8         a.  Each such member's account shall also be posted

  9  with the total contribution his or her employer agrees to make

10  in the member's behalf for past service earned prior to

11  October 1, 1975, excluding those contributions representing

12  the employer's matching share and the compound interest

13  calculation on the total contribution. However, a portion of

14  any contributions paid by an employer for past service credit

15  earned on and after October 1, 1975, may not be posted to a

16  member's account.

17         b.  A refund of contributions payable after an employer

18  has made a written agreement to purchase past service for

19  employees of the covered group shall include contributions for

20  past service which are posted to a member's account. However,

21  contributions for past service earned on and after October 1,

22  1975, are not refundable.

23         (2)  Prior service, as defined in s. 121.021(19), may

24  be claimed as creditable service under the Florida Retirement

25  System after a member has been reemployed for 12 continuous

26  months, except as provided in paragraph (c). Service performed

27  as a participant of the optional retirement program for the

28  State University System under s. 121.35 or the Senior

29  Management Service Optional Annuity Program under s. 121.055

30  may be used to satisfy the 12-continuous-month requirement.

31  The member shall not be permitted to make any contributions

                                  29

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  for prior service until after the 12-month period. The

  2  required contributions for claiming the various types of prior

  3  service are:

  4         (a)  For prior service performed prior to the date the

  5  system becomes noncontributory for the member and for which

  6  the member had credit under one of the existing retirement

  7  systems and received a refund of contributions upon

  8  termination of employment, the member shall contribute 4

  9  percent of all salary received during the period being

10  claimed, plus 4 percent interest compounded annually from date

11  of refund until July 1, 1975, and 6.5 percent interest

12  compounded annually thereafter, until full payment is made to

13  the Retirement Trust Fund. A member who elected to transfer to

14  the Florida Retirement System from an existing system may

15  receive credit for prior service under the existing system if

16  he or she was eligible under the existing system to claim the

17  prior service at the time of the transfer. Contributions for

18  such prior service shall be determined by the applicable

19  provisions of the system under which the prior service is

20  claimed and shall be paid by the member, with matching

21  contributions paid by the employer at the time the service was

22  performed. Effective July 1, 1978, the account of a person who

23  terminated under s. 238.05(3) may not be charged interest for

24  contributions that remained on deposit in the Annuity Savings

25  Trust Fund established under chapter 238, upon retirement

26  under chapter 121 or chapter 238.

27         (e)  For service performed under the Florida Retirement

28  System after December 1, 1970, that was never reported to the

29  division due to error, retirement credit may be claimed by a

30  member of the Florida Retirement System. The division shall

31  adopt rules establishing criteria for claiming such credit and

                                  30

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  detailing the documentation required to substantiate the

  2  error.

  3         (f)  The employer may not be required to make

  4  contributions for prior service credit for any member, except

  5  that the employer shall pay the employer portion of

  6  contributions for any legislator who elects to withdraw from

  7  the Florida Retirement System and later rejoins the system and

  8  pays any employee contributions required in accordance with s.

  9  121.052(3)(d).

10         Section 9.  Section 121.091, Florida Statutes, as

11  amended by chapters 97-154 and 97-180, Laws of Florida, is

12  amended to read:

13         121.091  Benefits payable under the system.--No

14  Benefits may not shall be paid under this section unless the

15  member has terminated employment as provided in s.

16  121.021(39)(a) or begun participation in the Deferred

17  Retirement Option Program as provided in subsection (13), and

18  a proper application has been filed in the manner prescribed

19  by the division. The division may cancel an application for

20  retirement benefits when the member or beneficiary fails to

21  timely provide the information and documents required by this

22  chapter and the division's rules. The division shall adopt

23  rules establishing procedures for application for retirement

24  benefits and for the cancellation of such application when the

25  required information or documents are not received.

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

27  her normal retirement date, the member, upon application to

28  the administrator, shall receive a monthly benefit which shall

29  begin to accrue on the first day of the month of retirement

30  and be payable on the last day of that month and each month

31  thereafter during his or her lifetime. The normal retirement

                                  31

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  benefit, including any past or additional retirement credit,

  2  may not exceed 100 percent of the average final compensation.

  3  The amount of monthly benefit shall be calculated determined

  4  as the product of A and B, subject to the adjustment of C, if

  5  applicable, as set forth below when:

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

  7  is 1.60 percent of the member's average final monthly

  8  compensation, up to the member's normal retirement date age.

  9  Upon completion of the first year after the normal retirement

10  date age, A is 1.63 percent of the member's average final

11  monthly compensation.  Following the second year after the

12  normal retirement date age, A is 1.65 percent of the member's

13  average final monthly compensation.  Following the third year

14  after the normal retirement date age, and for subsequent

15  years, A is 1.68 percent of the member's average final monthly

16  compensation.  A shall not exceed 1.68 percent of the member's

17  average monthly compensation, except that,

18         2. For all creditable years of special risk service, A

19  is:

20         a.1.  Two percent of the member's average final monthly

21  compensation for all creditable years prior to October 1,

22  1974;

23         b.2.  Three percent of the member's average final

24  monthly compensation for all creditable years after September

25  30, 1974, and before October 1, 1978;

26         c.3.  Two percent of the member's average final monthly

27  compensation for all creditable years after September 30,

28  1978, and before January 1, 1989;

29         d.4.  Two and two-tenths percent of the member's final

30  average monthly compensation for all creditable years after

31  December 31, 1988, and before January 1, 1990;

                                  32

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         e.5.  Two and four-tenths percent of the member's

  2  average final monthly compensation for all creditable years

  3  after December 31, 1989, and before January 1, 1991;

  4         f.6.  Two and six-tenths percent of the member's

  5  average final monthly compensation for all creditable years

  6  after December 31, 1990, and before January 1, 1992;

  7         g.7.  Two and eight-tenths percent of the member's

  8  average final monthly compensation for all creditable years

  9  after December 31, 1991, and before January 1, 1993; and

10         h.8.  Three percent of the member's average final

11  monthly compensation for all creditable years after December

12  31, 1992;

13         3.  For creditable years of Senior Management Service

14  Class service after January 31, 1987, A is 2 percent;

15         4.  For creditable years of Elected State and County

16  Officers' Class service as a Supreme Court Justice, district

17  court of appeal judge, circuit judge, or county court judge, A

18  is 3 1/3 percent of the member's average final compensation,

19  and for all other creditable service in such class, A is 3

20  percent of average final compensation;

21

22  however, the normal retirement benefit, including any past or

23  additional retirement credit, may not exceed 100 percent of

24  the average final compensation;

25         (b)  B is the number of the member's years and any

26  fractional part of a year of creditable service earned

27  subsequent to November 30, 1970; and

28         (c)  C is the normal retirement benefit credit brought

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

30  existing system.  Such normal retirement benefit credit shall

31  be determined as the product of X A and Y B when X A is the

                                  33

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  percentage of average final compensation which the member

  2  would have been eligible to receive if the member had attained

  3  his or her normal retirement date as of November 30, 1970, all

  4  in accordance with the existing system under which the member

  5  is covered on November 30, 1970, and Y B is average final

  6  monthly compensation as defined in s. 121.021(25).  However,

  7  any member of an existing retirement system who is eligible to

  8  retire and who does retire, become disabled, or die prior to

  9  April 15, 1971, may have his or her retirement benefits

10  calculated on the basis of the best 5 of the last 10 years of

11  service.

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

13  determined by formula to obtain the coverage for the 5 highest

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

15         (2)  BENEFITS PAYABLE FOR DUAL NORMAL RETIREMENT

16  AGES.--If In the event a member accumulates retirement

17  benefits to commence at different normal retirement ages by

18  virtue of having performed duties for an employer which would

19  entitle him or her to benefits as both a regular member and

20  special risk member of the Special Risk Class and a member of

21  the Regular Class, Senior Management Service Class, or Elected

22  State and County Officers' Class, the amount of benefits

23  payable shall be computed separately with respect to each such

24  age and the sum of such computed amounts shall be paid as

25  provided in this section.

26         (3)  EARLY RETIREMENT BENEFIT.--Upon retirement on his

27  or her early retirement date, the member shall receive an

28  immediate monthly benefit that which shall begin to accrue on

29  the first day of the month of the retirement date and be

30  payable on the last day of that month and each month

31

                                  34

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  thereafter during his or her lifetime.  Such benefit shall be

  2  calculated as follows:

  3         (a)  The amount of each monthly payment shall be

  4  computed in the same manner as for a normal retirement

  5  benefit, in accordance with subsection (1), but shall be based

  6  on the member's average monthly compensation and creditable

  7  service as of the member's early retirement date.  The benefit

  8  so computed shall be reduced by five-twelfths of 1 percent for

  9  each complete month by which the early retirement date

10  precedes the normal retirement date of age 62 for a regular

11  member of the Regular Class, Senior Management Service Class,

12  or a member of the Elected State and County Officers' Class,

13  and age 55 for a member of the Special Risk Class, member or

14  age 52 if a Special Risk member has completed 25 years of

15  creditable service in accordance with s. 121.021(29)(b)3. s.

16  121.021(29)(c)3.

17         (b)  However, If the employment of a member is

18  terminated by reason of death subsequent to the completion of

19  20 years of creditable service, the monthly benefit payable to

20  the member's beneficiary shall be calculated in accordance

21  with subsection (1), but shall be based on average monthly

22  compensation and creditable service as of the date of death.

23  The benefit so computed shall be reduced by five-twelfths of 1

24  percent for each complete month by which death precedes the

25  normal retirement date specified above or the date on which

26  the member would have attained 30 years of creditable service

27  had he or she survived and continued his or her employment,

28  whichever provides a higher benefit.

29         (4)  DISABILITY RETIREMENT BENEFIT.--

30         (a)  Disability retirement; entitlement and effective

31  date.--

                                  35

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         1.  A member who becomes totally and permanently

  2  disabled, as defined in paragraph (b), after completing 5

  3  years of creditable service, or a member who becomes totally

  4  and permanently disabled in the line of duty regardless of

  5  service, shall be entitled to a monthly disability benefit;

  6  except that any member with less than 5 years of creditable

  7  service on July 1, 1980, or any person who becomes a member of

  8  the Florida Retirement System on or after such date must have

  9  completed 10 years of creditable service prior to becoming

10  totally and permanently disabled in order to receive

11  disability retirement benefits for any disability which occurs

12  other than in the line of duty.  However, if a But in the

13  event that any member employed on July 1, 1980, with less than

14  5 years of creditable service as of that date, becomes totally

15  and permanently disabled after completing 5 years of

16  creditable service and is found not to have attained fully

17  insured status for benefits under the federal Social Security

18  Act, such member shall be entitled to a monthly disability

19  benefit.  The disability retirement date shall be the first

20  day of the month which coincides with or next follows the date

21  the administrator approves payment of disability retirement

22  benefits to the member.

23         2.  If the division has received from the employer the

24  required documentation of the member's termination of

25  employment, the effective retirement date for a member who

26  applies and is approved for disability retirement shall be

27  established by rule of the division.

28         3.  For a member who is receiving Workers' Compensation

29  payments, the effective disability retirement date may not

30  precede the date the member reaches Maximum Medical

31

                                  36

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  Improvement (MMI), unless the member terminates employment

  2  prior to reaching MMI.

  3         (b)  Total and permanent disability.--A member shall be

  4  considered totally and permanently disabled if, in the opinion

  5  of the administrator, he or she is prevented, by reason of a

  6  medically determinable physical or mental impairment, from

  7  rendering useful and efficient service as an officer or

  8  employee.

  9         (c)  Proof of disability.--The administrator, before

10  approving payment of any disability retirement benefit, shall

11  require proof that the member is totally and permanently

12  disabled as provided herein, which proof shall include the

13  certification of the member's total and permanent disability

14  by two licensed physicians of the state and such other

15  evidence of disability as the administrator may require,

16  including reports from vocational rehabilitation, evaluation,

17  or testing specialists who have evaluated the applicant for

18  employment. The unavailability of an employment position that

19  the member is physically and mentally capable of performing

20  will not be considered as proof of total and permanent

21  disability.

22         (d)  Election on appeal.--A member whose application

23  for regular disability retirement has been denied and who has

24  filed an appeal to the State Retirement Commission may, if

25  eligible, elect to receive normal or early service retirement

26  benefits while he or she is awaiting the decision on the

27  appeal. However:

28         1.  If the member elects to receive service retirement

29  benefits and disability benefits are later approved as a

30  result of the appeal, the payment option chosen by the member

31  may not be changed.

                                  37

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         2.  If the member elects to receive early service

  2  retirement and the appeal is later denied, the member may not

  3  change his or her election of early retirement.

  4

  5  Before such regular or early retirement benefits may be paid

  6  by the division, the member must provide to the division a

  7  written statement indicating that the member understands that

  8  such changes are not permitted after he or she begins

  9  receiving the benefits.

10         (e)(d)  Disability retirement benefit.--Upon the

11  retirement of a member on his or her disability retirement

12  date, the member shall receive a monthly benefit that which

13  shall begin to accrue on the first day of the month of

14  disability retirement and shall be payable on the last day of

15  that month and each month thereafter during his or her

16  lifetime and continued disability.

17         (f)  Computation of disability retirement benefit.--The

18  amount of each monthly payment shall be computed in the same

19  manner as for a normal retirement benefit, in accordance with

20  subsection (1), but shall be based on disability option

21  actuarial equivalency tables and the average monthly

22  compensation and creditable service of the member as of the

23  disability retirement date, subject to the following

24  conditions:

25         1.  If the member's disability occurred in the line of

26  duty, the monthly Option 1 benefit shall not be less than 42

27  percent of average monthly compensation as of the disability

28  retirement date; or

29         2.  If the member's disability occurred other than in

30  the line of duty, the monthly Option 1 benefit shall not be

31

                                  38

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  less than 25 percent of average monthly compensation as of the

  2  disability retirement date.

  3         (g)  Reapplication.--A member, whose initial

  4  application for disability retirement has been denied, may

  5  reapply for disability benefits. However, such member's

  6  reapplication will be considered only if the member presents

  7  new medical evidence of a medical condition that existed prior

  8  to the member's termination of employment. The division may

  9  prescribe by rule procedures for reapplication and for review

10  and approval or disapproval of reapplication.

11         (h)(e)  Recovery from disability.--The administrator

12  may require periodic reexaminations at the expense of the

13  retirement fund. The division may adopt rules establishing

14  procedures for conducting and review of such reexaminations.,

15  and:

16         1.  If the administrator finds that a member who is

17  receiving disability benefits is, at any time prior to his or

18  her normal retirement date, no longer disabled, the

19  administrator shall direct that the benefits be discontinued.

20  The decision of the administrator on this question shall be

21  final and binding. If such member:

22         a.2.  If the member, described in subparagraph 1., who

23  recovers from such disability prior to the normal retirement

24  date Does not reenter the employ of an employer and was not

25  vested had not completed 10 years of creditable service as of

26  the disability retirement date, he or she shall be entitled to

27  the excess, if any, of his or her accumulated contributions

28  over the total disability benefits received up to the date of

29  recovery.

30         b.3.  If the member, described in subparagraph 1., who

31  recovers from such disability prior to the normal retirement

                                  39

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  date Does not reenter the employ of an employer, but was

  2  vested had completed 10 or more years of creditable service as

  3  of the disability retirement date, he or she may elect to

  4  receive:

  5         (I)a.  The excess, if any, of his or her accumulated

  6  contributions over the total disability benefits received up

  7  to the date of recovery;, or

  8         (II)b.  A deferred benefit commencing on the last day

  9  of the month of the normal retirement date which shall be

10  payable on the last day of the month thereafter during his or

11  her lifetime.  The amount of such monthly benefit shall be

12  computed in the same manner as for a normal retirement

13  benefit, in accordance with subsection (1), but shall be based

14  on average monthly compensation and creditable service as of

15  the member's disability retirement date.

16         c.4.  If the member recovers from disability and

17  Reenters employment of an employer within 6 months after

18  recovery, the member's service will be deemed to have been

19  continuous, but the period beginning with the first month for

20  which he or she received a disability benefit payment and

21  ending with the date he or she reentered employment will not

22  be considered as creditable service for the purpose of

23  computing benefits except as provided in sub-subparagraph d.

24  As used in this section, subparagraph 5. the term "accumulated

25  contributions" for such member wherever used in this section

26  after such recovery means the excess of the a member's

27  accumulated contributions as of the disability retirement date

28  over the total disability benefits received under paragraph

29  (e)(d).

30         d.5.  Terminates If the member recovers from

31  disability, has his or her disability benefit terminated,

                                  40

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  reenters covered employment, and is continuously employed for

  2  a minimum of 1 year of creditable service, he or she may claim

  3  as creditable service the months during which he or she was

  4  receiving a disability benefit, upon payment of the required

  5  contributions.  Contributions shall equal the total required

  6  employee and employer contribution rate applicable during the

  7  period the retiree received retirement benefits, multiplied

  8  times his or her rate of monthly compensation prior to the

  9  commencement of disability retirement for each month of the

10  period claimed, plus 4 percent interest until July 1, 1975,

11  and 6.5 percent interest thereafter on such contributions,

12  compounded annually each June 30 to the date of payment.  If

13  the member does not claim credit for all of the months he or

14  she received disability benefits, the months claimed must be

15  the most recent months of retirement. Such credit for periods

16  of disability, when purchased under the Florida Retirement

17  System, shall apply toward vesting requirements for

18  eligibility to purchase additional credit for other service.

19         2.  Both the member receiving disability benefits who

20  reenters employment and the employer employing such disability

21  retiree shall notify the division immediately upon

22  reemployment, and the division shall terminate such member's

23  disability benefits, effective the first day of the month

24  following the month in which notification of recovery is

25  received. If the member is reemployed with a Florida

26  Retirement System employer at the time of benefit termination,

27  and he or she has received disability retirement benefit and

28  salary payments concurrently prior to notifying the division,

29  he or she may elect within 30 days to:

30         a.  Retain the retirement benefits received prior to

31  termination of disability benefits and begin receiving

                                  41

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  retirement service credit effective upon the date of

  2  termination of benefits; or

  3         b.  Repay, within 12 months after his or her decision

  4  to receive service credit, the retirement benefits received

  5  for each month of reemployment prior to termination of

  6  disability benefits and begin receiving retirement service

  7  credit effective upon the date of reemployment. Any such

  8  unpaid benefits shall have compound interest of 6.5 percent

  9  added June 30.

10

11  A member may not receive both retirement service credit for

12  employment and retirement benefits for the same month.

13         3.6.  If, after recovery of disability and reentry into

14  covered employment, the member again becomes disabled and is

15  again approved for disability retirement, the Option 1 monthly

16  retirement benefit shall not be less than the Option 1 monthly

17  benefit calculated at the time of the previous disability,

18  plus any cost of living increases up to the time the

19  disability benefit was terminated upon his or her reentry into

20  covered employment.

21         (i)(f)  Nonadmissible causes of disability.--A member

22  shall not be entitled to receive any disability retirement

23  benefit if the disability is a result of any of the following:

24         1.  Injury or disease sustained by the member while

25  willfully participating in a riot, civil insurrection, or

26  other act of violence or while committing a felony;

27         2.  Injury or disease sustained by the member after his

28  or her employment has terminated; or

29         3.  Intentional, self-inflicted injury.

30         (j)(g)  Disability retirement of justice or judge by

31  order of Supreme Court.--

                                  42

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         1.  If a member is a justice of the Supreme Court,

  2  judge of a district court of appeal, circuit judge, or judge

  3  of a county court who has served for 10 years or more as an

  4  elected constitutional judicial officer, including service as

  5  a judicial officer in any court abolished pursuant to Art. V

  6  of the State Constitution, and who is retired for disability

  7  by order of the Supreme Court upon recommendation of the

  8  Judicial Qualifications Commission pursuant to the provisions

  9  of Art. V of the State Constitution, the member's Option 1

10  monthly benefit as provided in subparagraph (6)(a)1. shall not

11  be less than two-thirds of his or her monthly compensation as

12  of the member's disability retirement date.  Such a member may

13  alternatively elect to receive a disability retirement benefit

14  under any other option as provided in paragraph (6)(a).

15         2.  Should any justice or judge who is a member of the

16  Florida Retirement System be retired for disability by order

17  of the Supreme Court upon recommendation of the Judicial

18  Qualifications Commission pursuant to the provisions of Art. V

19  of the State Constitution, then all contributions to his or

20  her account and all contributions made on his or her behalf by

21  the employer shall be transferred to and deposited in the

22  General Revenue Fund of the state, and there is hereby

23  appropriated annually out of the General Revenue Fund, to be

24  paid into the Florida Retirement System Fund, an amount

25  necessary to pay the benefits of all justices and judges

26  retired from the Florida Retirement System pursuant to Art. V

27  of the State Constitution.

28         (5)  TERMINATION BENEFITS.--

29         (a)  A member whose employment is terminated for any

30  reason other than death or retirement prior to becoming vested

31  is the completion of 10 years of creditable service shall be

                                  43

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  entitled to the return of his or her accumulated contributions

  2  as of the date of termination.

  3         (b)  A member whose employment is terminated for any

  4  reason other than death or retirement after becoming vested

  5  the completion of 10 years of creditable service may elect to

  6  receive a deferred monthly benefit which shall begin to accrue

  7  on the first day of the month of normal or early retirement

  8  and shall be payable on the last day of that month and each

  9  month thereafter during his or her lifetime.  The amount of

10  monthly benefit shall be computed in the same manner as for a

11  normal retirement benefit in accordance with subsection (1) or

12  early retirement benefit in accordance with s. 121.021(30),

13  but based on average monthly compensation and creditable

14  service as of the date of termination.

15         (c)  In lieu of the deferred monthly benefit provided

16  in paragraph (b), the terminated member may elect to receive a

17  lump-sum amount equal to his or her accumulated contributions

18  as of the date of termination.

19         (d)  If any retired member dies without having received

20  in benefit payments an amount equal to his or her accumulated

21  contributions, there shall be payable to his or her designated

22  beneficiary an amount equal to the excess, if any, of the

23  member's accumulated contributions over the total monthly

24  payments made to the member prior to the date of death.

25         (e)  A member shall be deemed a terminated member when

26  termination of employment has occurred as provided in s.

27  121.021(39).

28         (f)  Any member who has been found guilty by a verdict

29  of a jury, or by the court trying the case without a jury, of

30  committing, aiding, or abetting any embezzlement or theft from

31  his or her employer, bribery in connection with the

                                  44

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  employment, or other felony specified in chapter 838, except

  2  ss. 838.15 and 838.16, committed prior to retirement, or who

  3  has entered a plea of guilty or of nolo contendere to such

  4  crime, or any member whose employment is terminated by reason

  5  of the member's admitted commitment, aiding, or abetting of an

  6  embezzlement or theft from his or her employer, bribery, or

  7  other felony specified in chapter 838, except ss. 838.15 and

  8  838.16, shall forfeit all rights and benefits under this

  9  chapter, except the return of his or her accumulated

10  contributions as of the date of termination.

11         (g)  Any elected official who is convicted by the

12  Senate of an impeachable offense shall forfeit all rights and

13  benefits under this chapter, except the return of his or her

14  accumulated contributions as of the date of the conviction.

15         (h)  Any member who, prior to retirement, is adjudged

16  by a court of competent jurisdiction to have violated any

17  state law against strikes by public employees, or who has been

18  found guilty by such court of violating any state law

19  prohibiting strikes by public employees, shall forfeit all

20  rights and benefits under this chapter, except the return of

21  his or her accumulated contributions as of the date of the

22  conviction.

23         (i)  Any beneficiary who by a verdict of a jury or by

24  the court trying the case without a jury is found guilty, or

25  who has entered a plea of guilty or nolo contendere, of

26  unlawfully and intentionally killing or procuring the death of

27  the member forfeits all rights to the deceased member's

28  benefits under this chapter, and the benefits will be paid as

29  if such beneficiary had predeceased the decedent. Benefits may

30  not be paid by the division pending final resolution of such

31  charges against the beneficiary.

                                  45

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         (6)  OPTIONAL FORMS OF RETIREMENT BENEFITS AND

  2  DISABILITY RETIREMENT BENEFITS.--

  3         (a)  Prior to the receipt of the first monthly

  4  retirement payment, a member shall elect to receive the

  5  retirement benefits to which he or she is entitled under

  6  subsection (1), subsection (2), subsection (3), or subsection

  7  (4) in accordance with one of the following options:

  8         1.  The maximum retirement benefit payable to the

  9  member during his or her lifetime.

10         2.  A decreased retirement benefit payable to the

11  member during his or her lifetime and, in the event of his or

12  her death within a period of 10 years after retirement, the

13  same monthly amount payable for the balance of such 10-year

14  period to his or her beneficiary or, in case the beneficiary

15  is deceased, in accordance with subsection (8) as though no

16  beneficiary had been named.

17         3.  A decreased retirement benefit payable during the

18  joint lifetime of both the member and his or her joint

19  annuitant and which, after the death of either, shall continue

20  during the lifetime of the survivor in the same amount,

21  subject to the provisions of subsection (12).

22         4.  A decreased retirement benefit payable during the

23  joint lifetime of the member and his or her joint annuitant

24  and which, after the death of either, shall continue during

25  the lifetime of the survivor in an amount equal to 66 2/3

26  percent of the amount that was payable during the joint

27  lifetime of the member and his or her joint annuitant, subject

28  to the provisions of subsection (12).

29

30  The spouse of any member who elects to receive the benefit

31  provided under subparagraph 1. or subparagraph 2. shall be

                                  46

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  notified of and shall acknowledge any such election. The

  2  division shall establish by rule a method for selecting the

  3  appropriate actuarial factor for optional forms of benefits

  4  selected under subparagraphs 3. and 4., based on the age of

  5  the member and the joint annuitant.

  6         (b)  The benefit payable under any option stated above

  7  shall be the actuarial equivalent, based on tables adopted by

  8  the administrator for this purpose, of the amount to which the

  9  member was otherwise entitled.

10         (c)  A member who elects the option in subparagraph

11  (a)2. shall, in accordance with subsection (8), designate one

12  or more persons to receive the benefits payable in the event

13  of his or her death. Such persons shall be the beneficiaries

14  of the member.  The member may also designate one or more

15  contingent beneficiaries to receive any benefits remaining

16  upon the death of the primary beneficiary.

17         (d)  A member who elects the option in subparagraph

18  (a)3. or subparagraph (a)4. shall, on a form provided for that

19  purpose, designate a joint annuitant to receive the benefits

20  which continue to be payable upon the death of the member.

21  After benefits have commenced under the option in subparagraph

22  (a)3. or subparagraph (a)4., a retired member may change his

23  or her designation of a joint annuitant only twice.  If such a

24  retired member desires to change his or her designation of a

25  joint annuitant, he or she shall file with the division a

26  notarized "change of joint annuitant" form and shall notify

27  the former joint annuitant in writing of such change.

28  Effective the first day of the next month following receipt by

29  the division of a completed change of joint annuitant form,

30  the division shall adjust the member's monthly benefit by the

31  application of actuarial tables and calculations developed to

                                  47

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  ensure that the benefit paid is the actuarial equivalent of

  2  the present value of the member's current benefit.  The

  3  consent of a retired member's first designated joint annuitant

  4  to any such change shall not be required. However, if either

  5  the member or the joint annuitant dies before the effective

  6  date of the request for change of joint annuitant, the

  7  requested change shall be void, and survivor benefits, if any,

  8  shall be paid as if no request had been made.

  9         (e)  The election of an option shall be null and void

10  if the member dies before the effective date of retirement.

11         (f)  A member who elects to receive benefits under the

12  option in subparagraph (a)3. may designate one or more

13  qualified persons, either a spouse or other dependent, as his

14  or her joint annuitant to receive the benefits after the

15  member's death in whatever proportion he or she so assigns to

16  each person named as joint annuitant. The division shall adopt

17  appropriate actuarial tables and calculations necessary to

18  ensure that the benefit paid is the actuarial equivalent of

19  the benefit to which the member is otherwise entitled under

20  the option in subparagraph (a)1.

21         (g)  Upon the death of a retired member or beneficiary

22  receiving monthly benefits under this chapter, the monthly

23  benefits shall be paid through the last day of the month of

24  death and shall terminate, or be adjusted, if applicable, as

25  of that date in accordance with the optional form of benefit

26  selected at the time of retirement.

27         (h)  The option selected or determined for payment of

28  benefits as provided in this section shall be final and

29  irrevocable at the time a benefit payment is cashed or

30  deposited or credited to the Deferred Retirement Option

31  Program as provided in subsection (13).

                                  48

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         (7)  DEATH BENEFITS.--

  2         (a)  If the employment of a member is terminated by

  3  reason of his or her death prior to being vested the

  4  completion of 10 years of creditable service, there shall be

  5  payable to his or her designated beneficiary the member's

  6  accumulated contributions.

  7         (b)  If the employment of an active member who may or

  8  may not have applied for retirement is terminated by reason of

  9  his or her death subsequent to becoming vested the completion

10  of 10 years of creditable service and prior to his or her

11  effective date of retirement, if established, it shall be

12  assumed that the member retired as of the date of death in

13  accordance with subsection (1) if eligible for normal

14  retirement benefits, subsection (2) if eligible for benefits

15  payable for dual normal retirement, or subsection (3) if

16  eligible for early retirement benefits.  Benefits payable to

17  the designated beneficiary shall be as follows:

18         1.  For a beneficiary who qualifies as a joint

19  annuitant, the optional form of payment provided in accordance

20  with subparagraph (6)(a)3. shall be paid for the joint

21  annuitant's lifetime.

22         2.  For a beneficiary who does not qualify as a joint

23  annuitant, no continuing monthly benefit shall be paid and the

24  beneficiary shall be entitled only to the return of the

25  member's personal contributions. If there is no monetary

26  interest in the member's retirement account for which such

27  beneficiary is eligible, the beneficiary shall be the next

28  named beneficiary or, if no other beneficiary is named, the

29  beneficiary shall be the next eligible beneficiary according

30  to subsection (8).

31

                                  49

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         (c)  If a retiring member dies on or after the

  2  effective date of retirement, but prior to a benefit payment

  3  being cashed or deposited, or credited to the Deferred

  4  Retirement Option Program, benefits shall be paid as follows:

  5         1.  For a designated beneficiary who qualifies as a

  6  joint annuitant, benefits shall be paid in the optional form

  7  of payment provided in subparagraph (6)(a)3. for the joint

  8  annuitant's lifetime or, if the member chose the optional form

  9  of payment provided in subparagraph (6)(a)2., the joint

10  annuitant may select the form provided in either subparagraph

11  (6)(a)2. or subparagraph (6)(a)3.

12         2.  For a designated beneficiary who does not qualify

13  as a joint annuitant, any benefits payable shall be paid as

14  provided in the option selected by the member; or if the

15  member has not selected an option, benefits shall be paid in

16  the optional form of payment provided in subparagraph (6)(a)1.

17         (d)  Notwithstanding any other provision in this

18  chapter to the contrary, with the exception of the Deferred

19  Retirement Option Program, as provided in subsection (13):

20         1.  The surviving spouse of any member killed in the

21  line of duty may receive a monthly pension equal to one-half

22  of the monthly salary being received by the member at the time

23  of death for the rest of the surviving spouse's lifetime or,

24  if the member was vested, such surviving spouse may elect to

25  receive a benefit as provided in paragraph (b). Benefits

26  provided by this paragraph shall supersede any other

27  distribution that may have been provided by the member's

28  designation of beneficiary.

29         2.  If the surviving spouse of a member killed in the

30  line of duty dies, the monthly payments which would have been

31  payable to such surviving spouse had such surviving spouse

                                  50

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  lived shall be paid for the use and benefit of such member's

  2  child or children under 18 years of age and unmarried until

  3  the 18th birthday of the member's youngest child.

  4         3.  If a member killed in the line of duty leaves no

  5  surviving spouse but is survived by a child or children under

  6  18 years of age, the benefits provided by subparagraph 1.,

  7  normally payable to a surviving spouse, shall be paid for the

  8  use and benefit of such member's child or children under 18

  9  years of age and unmarried until the 18th birthday of the

10  member's youngest child.

11         4.  The surviving spouse of a member whose benefit

12  terminated because of remarriage shall have the benefit

13  reinstated beginning July 1, 1993, at an amount that would

14  have been payable had the benefit not been terminated.

15         (e)  The surviving spouse or other dependent of any

16  member, except a member who participated in the Deferred

17  Retirement Option Program, whose employment is terminated by

18  death shall, upon application to the administrator, be

19  permitted to pay the required contributions for any service

20  performed by the member which could have been claimed by the

21  member at the time of his or her death.  Such service shall be

22  added to the creditable service of the member and shall be

23  used in the calculation of any benefits which may be payable

24  to the surviving spouse or other surviving dependent.

25         (f)  Notwithstanding any other provisions in this

26  chapter to the contrary, if any member who is vested has

27  accumulated at least 10 years of creditable service dies and

28  the surviving spouse receives a refund of the accumulated

29  contributions made to the retirement trust fund, such spouse

30  may pay to the Division of Retirement an amount equal to the

31  sum of the amount of the deceased member's accumulated

                                  51

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  contributions previously refunded plus interest at 4 percent

  2  compounded annually each June 30 from the date of refund until

  3  July 1, 1975, and 6.5 percent interest compounded annually

  4  thereafter, until full payment is made, and receive the

  5  monthly retirement benefit as provided in paragraph (b).

  6         (g)  The designated beneficiary who is the surviving

  7  spouse or other dependent of a member whose employment is

  8  terminated by death subsequent to becoming vested, the

  9  completion of 10 years of creditable service but prior to

10  actual retirement, may elect to receive a deferred monthly

11  benefit as if the member had lived and had elected a deferred

12  monthly benefit, as provided in paragraph (5)(b), calculated

13  on the basis of the average final compensation and creditable

14  service of the member at his or her death and the age the

15  member would have attained on the commencement date of the

16  deferred benefit elected by the beneficiary, paid in

17  accordance with option 3 of paragraph (6)(a).

18         (8)  DESIGNATION OF BENEFICIARIES.--

19         (a)  Each member may, on a form provided for that

20  purpose, signed and filed with the division, designate a

21  choice of one or more persons, named sequentially or jointly,

22  as his or her beneficiary who shall receive the benefits, if

23  any, which may be payable in the event of the member's death

24  pursuant to the provisions of this chapter. If no beneficiary

25  is named in the manner provided above, or if no beneficiary

26  designated by the member survives the member, the beneficiary

27  shall be the spouse of the deceased, if living. If the

28  member's spouse is not alive at his or her death, the

29  beneficiary shall be the living children of the member.  If no

30  children survive, the beneficiary shall be the member's father

31  or mother, if living; otherwise, the beneficiary shall be the

                                  52

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  member's estate.  The beneficiary most recently designated by

  2  a member on a form or letter filed with the division shall be

  3  the beneficiary entitled to any benefits payable at the time

  4  of the member's death, except that benefits shall be paid as

  5  provided in paragraph (7)(d) when death occurs in the line of

  6  duty.

  7         (b)  A designated beneficiary of a retirement account

  8  for whom there is a monetary interest may disclaim his or her

  9  monetary interest as provided in s. 689.21, and in accordance

10  with division rules governing such disclaimers. Such

11  disclaimer must be filed within 24 months after the event that

12  created the interest, that is, the death of the member or

13  annuitant.

14         (9)  EMPLOYMENT AFTER RETIREMENT; LIMITATION.--

15         (a)  Any person who is retired under this chapter,

16  except under the disability retirement provisions of

17  subsection (4), may be employed by an employer that does not

18  participate in a state-administered retirement system and may

19  receive compensation from that employment without limiting or

20  restricting in any way the retirement benefits payable to that

21  person.

22         (b)1.  Any person who is retired under this chapter,

23  except under the disability retirement provisions of

24  subsection (4), may be reemployed by any private or public

25  employer after retirement and receive retirement benefits and

26  compensation from his or her employer without any limitations,

27  except that a person may not receive both a salary from

28  reemployment with any agency participating in the Florida

29  Retirement System and retirement benefits under this chapter

30  for a period of 12 months immediately subsequent to the date

31  of retirement. However, a DROP participant shall continue

                                  53

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  employment and receive a salary during the period of

  2  participation in the Deferred Retirement Option Program, as

  3  provided in subsection (13).

  4         2.  Any person to whom the limitation in subparagraph

  5  1. applies who violates such reemployment limitation and who

  6  is reemployed with any agency participating in the Florida

  7  Retirement System before completion of the 12-month limitation

  8  period shall give timely notice of this fact in writing to the

  9  employer and to the division and shall have his or her

10  retirement benefits suspended for the balance of the 12-month

11  limitation period.  Any person employed in violation of this

12  paragraph and any employing agency which knowingly employs or

13  appoints such person without notifying the Division of

14  Retirement to suspend retirement benefits shall be jointly and

15  severally liable for reimbursement to the retirement trust

16  fund of any benefits paid during the reemployment limitation

17  period.  To avoid liability, such employing agency shall have

18  a written statement from the retiree that he or she is not

19  retired from a state-administered retirement system.  Any

20  retirement benefits received while reemployed during this

21  reemployment limitation period shall be repaid to the

22  retirement trust fund, and retirement benefits shall remain

23  suspended until such repayment has been made.  Benefits

24  suspended beyond the reemployment limitation shall apply

25  toward repayment of benefits received in violation of the

26  reemployment limitation.

27         3.  A district school board may reemploy a retired

28  member as a substitute or hourly teacher, teacher aide,

29  transportation assistant, bus driver, or food service worker

30  on a noncontractual basis after he or she has been retired for

31  1 calendar month, in accordance with s. 121.021(39).  Any

                                  54

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  retired member who is reemployed within 1 calendar month after

  2  retirement shall void his or her application for retirement

  3  benefits.  District school boards reemploying such teachers,

  4  teacher aides, transportation assistants, bus drivers, or food

  5  service workers are subject to the retirement contribution

  6  required by subparagraph 7.  Reemployment of a retired member

  7  as a substitute or hourly teacher, teacher aide,

  8  transportation assistant, bus driver, or food service worker

  9  is limited to 780 hours during the first 12 months of his or

10  her retirement.  Any retired member reemployed for more than

11  780 hours during his or her first 12 months of retirement

12  shall give timely notice in writing to the employer and to the

13  division of the date he or she will exceed the limitation.

14  The division shall suspend his or her retirement benefits for

15  the remainder of the first 12 months of retirement.  Any

16  person employed in violation of this subparagraph and any

17  employing agency which knowingly employs or appoints such

18  person without notifying the Division of Retirement to suspend

19  retirement benefits shall be jointly and severally liable for

20  reimbursement to the retirement trust fund of any benefits

21  paid during the reemployment limitation period.  To avoid

22  liability, such employing agency shall have a written

23  statement from the retiree that he or she is not retired from

24  a state-administered retirement system.  Any retirement

25  benefits received by a retired member while reemployed in

26  excess of 780 hours during the first 12 months of retirement

27  shall be repaid to the Retirement System Trust Fund, and his

28  or her retirement benefits shall remain suspended until

29  repayment is made.  Benefits suspended beyond the end of the

30  retired member's first 12 months of retirement shall apply

31

                                  55

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  toward repayment of benefits received in violation of the

  2  780-hour reemployment limitation.

  3         4.  A community college board of trustees may reemploy

  4  a retired member as an adjunct instructor, that is, an

  5  instructor who is noncontractual and part-time, or as a

  6  participant in a phased retirement program within the State

  7  Community College System, after he or she has been retired for

  8  1 calendar month, in accordance with s. 121.021(39).  Any

  9  retired member who is reemployed within 1 calendar month after

10  retirement shall void his or her application for retirement

11  benefits.  Boards of trustees reemploying such instructors are

12  subject to the retirement contribution required in

13  subparagraph 7.  A retired member may be reemployed as an

14  adjunct instructor for no more than 780 hours during the first

15  12 months of retirement.  Any retired member reemployed for

16  more than 780 hours during the first 12 months of retirement

17  shall give timely notice in writing to the employer and to the

18  division of the date he or she will exceed the limitation.

19  The division shall suspend his or her retirement benefits for

20  the remainder of the first 12 months of retirement.  Any

21  person employed in violation of this subparagraph and any

22  employing agency which knowingly employs or appoints such

23  person without notifying the Division of Retirement to suspend

24  retirement benefits shall be jointly and severally liable for

25  reimbursement to the retirement trust fund of any benefits

26  paid during the reemployment limitation period.  To avoid

27  liability, such employing agency shall have a written

28  statement from the retiree that he or she is not retired from

29  a state-administered retirement system.  Any retirement

30  benefits received by a retired member while reemployed in

31  excess of 780 hours during the first 12 months of retirement

                                  56

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  shall be repaid to the Retirement System Trust Fund, and

  2  retirement benefits shall remain suspended until repayment is

  3  made.  Benefits suspended beyond the end of the retired

  4  member's first 12 months of retirement shall apply toward

  5  repayment of benefits received in violation of the 780-hour

  6  reemployment limitation.

  7         5.  The State University System may reemploy a retired

  8  member as an adjunct faculty member or as a participant in a

  9  phased retirement program within the State University System

10  after the retired member has been retired for 1 calendar

11  month, in accordance with s. 121.021(39).  Any retired member

12  who is reemployed within 1 calendar month after retirement

13  shall void his or her application for retirement benefits.

14  The State University System is subject to the retired

15  contribution required in subparagraph 7., as appropriate. A

16  retired member may be reemployed as an adjunct faculty member

17  or a participant in a phased retirement program for no more

18  than 780 hours during the first 12 months of his or her

19  retirement.  Any retired member reemployed for more than 780

20  hours during the first 12 months of retirement shall give

21  timely notice in writing to the employer and to the division

22  of the date he or she will exceed the limitation.  The

23  division shall suspend his or her retirement benefits for the

24  remainder of the first 12 months of retirement.  Any person

25  employed in violation of this subparagraph and any employing

26  agency which knowingly employs or appoints such person without

27  notifying the Division of Retirement to suspend retirement

28  benefits shall be jointly and severally liable for

29  reimbursement to the retirement trust fund of any benefits

30  paid during the reemployment limitation period.  To avoid

31  liability, such employing agency shall have a written

                                  57

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  statement from the retiree that he or she is not retired from

  2  a state-administered retirement system.  Any retirement

  3  benefits received by a retired member while reemployed in

  4  excess of 780 hours during the first 12 months of retirement

  5  shall be repaid to the Retirement System Trust Fund, and

  6  retirement benefits shall remain suspended until repayment is

  7  made.  Benefits suspended beyond the end of the retired

  8  member's first 12 months of retirement shall apply toward

  9  repayment of benefits received in violation of the 780-hour

10  reemployment limitation.

11         6.  The Board of Trustees of the Florida School for the

12  Deaf and the Blind may reemploy a retired member as a

13  substitute teacher, substitute residential instructor, or

14  substitute nurse on a noncontractual basis after he or she has

15  been retired for 1 calendar month, in accordance with s.

16  121.021(39).  Any retired member who is reemployed within 1

17  calendar month after retirement shall void his or her

18  application for retirement benefits. The Board of Trustees of

19  the Florida School for the Deaf and the Blind reemploying such

20  teachers, residential instructors, or nurses is subject to the

21  retirement contribution required by subparagraph 7.

22  Reemployment of a retired member as a substitute teacher,

23  substitute residential instructor, or substitute nurse is

24  limited to 780 hours during the first 12 months of his or her

25  retirement.  Any retired member reemployed for more than 780

26  hours during the first 12 months of retirement shall give

27  timely notice in writing to the employer and to the division

28  of the date he or she will exceed the limitation. The division

29  shall suspend his or her retirement benefits for the remainder

30  of the first 12 months of retirement.  Any person employed in

31  violation of this subparagraph and any employing agency which

                                  58

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  knowingly employs or appoints such person without notifying

  2  the Division of Retirement to suspend retirement benefits

  3  shall be jointly and severally liable for reimbursement to the

  4  retirement trust fund of any benefits paid during the

  5  reemployment limitation period.  To avoid liability, such

  6  employing agency shall have a written statement from the

  7  retiree that he or she is not retired from a

  8  state-administered retirement system.  Any retirement benefits

  9  received by a retired member while reemployed in excess of 780

10  hours during the first 12 months of retirement shall be repaid

11  to the Retirement System Trust Fund, and his or her retirement

12  benefits shall remain suspended until payment is made.

13  Benefits suspended beyond the end of the retired member's

14  first 12 months of retirement shall apply toward repayment of

15  benefits received in violation of the 780-hour reemployment

16  limitation.

17         7.  The employment by an employer of any retiree or

18  DROP participant of any state-administered retirement system

19  shall have no effect on the average final compensation or

20  years of creditable service of the retiree or DROP

21  participant.  Prior to July 1, 1991, upon employment of any

22  person, other than an elected officer as provided in s.

23  121.053, who has been retired under any state-administered

24  retirement program, the employer shall pay retirement

25  contributions in an amount equal to the unfunded actuarial

26  liability portion of the employer contribution which would be

27  required for regular members of the Florida Retirement System.

28  Effective July 1, 1991, contributions shall be made as

29  provided in s. 121.122 for retirees with renewed membership or

30  subsection (13) with respect to DROP participants.

31

                                  59

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         8.  Any person who has previously retired and who is

  2  holding an elective public office or an appointment to an

  3  elective public office eligible for the Elected State and

  4  County Officers' Class on or after July 1, 1990, shall be

  5  enrolled in the Florida Retirement System as provided in s.

  6  121.053(1)(b) or, if holding an elective public office that

  7  does not qualify for the Elected State and County Officers'

  8  Class on or after July 1, 1991, shall be enrolled in the

  9  Florida Retirement System as provided in s. 121.122, and shall

10  continue to receive retirement benefits as well as

11  compensation for the elected officer's service for as long as

12  he or she remains in elective office. However, any retired

13  member who served in an elective office prior to July 1, 1990,

14  suspended his or her retirement benefit, and had his or her

15  Florida Retirement System membership reinstated shall, upon

16  retirement from such office, have his or her retirement

17  benefit recalculated to include the additional service and

18  compensation earned.

19         9.  Any person who is holding an elective public office

20  which is covered by the Florida Retirement System and who is

21  concurrently employed in nonelected covered employment may

22  elect to retire while continuing employment in the elective

23  public office, provided that he or she shall be required to

24  terminate his or her nonelected covered employment.  Any

25  person who exercises this election shall receive his or her

26  retirement benefits in addition to the compensation of the

27  elective office without regard to the time limitations

28  otherwise provided in this subsection.  No person who seeks to

29  exercise the provisions of this subparagraph, as the same

30  existed prior to May 3, 1984, shall be deemed to be retired

31  under those provisions, unless such person is eligible to

                                  60

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  retire under the provisions of this subparagraph, as amended

  2  by chapter 84-11, Laws of Florida.

  3         10.  The limitations of this paragraph apply to

  4  reemployment in any capacity with an "employer" as defined in

  5  s. 121.021(10), irrespective of the category of funds from

  6  which the person is compensated.

  7         11.  From July 1, 1997, through December 31, 1998,

  8  notwithstanding the limitations of this subsection, except

  9  that any retiree who is reemployed within 1 calendar month

10  after retirement shall void his or her application for

11  retirement benefits, any retiree of the Florida Retirement

12  System may be reemployed by a covered employer during the 2nd

13  through 12th months of the reemployment limitation period

14  without suspending his or her retirement benefits, provided

15  that the reemployment is for the sole purpose of working on

16  the technical aspects of correcting or replacing the computer

17  systems and programs necessary to resolve the year 2000 date

18  problem for computing which confronts all public employers

19  covered by the Florida Retirement System.

20         (10)  FUTURE BENEFITS BASED ON ACTUARIAL DATA.--It is

21  the intent of the Legislature that future benefit increases

22  enacted into law in this chapter shall be financed

23  concurrently by increased contributions or other adequate

24  funding, and such funding shall be based on sound actuarial

25  data as developed by the actuary or state retirement actuary,

26  as provided in ss. 121.021(6) and 121.192.

27         (11)  A member who becomes eligible to retire and has

28  accumulated the maximum benefit of 100 percent of average

29  final compensation may continue in active service, and, if

30  upon the member's retirement the member elects to receive a

31  retirement compensation pursuant to subsection (2), subsection

                                  61

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  (6), or subsection (7), the actuarial equivalent percentage

  2  factor applicable to the age of such member at the time the

  3  member reached the maximum benefit and to the age, at that

  4  time, of the member's spouse shall determine the amount of

  5  benefits to be paid.

  6         (12)  SPECIAL PROVISIONS FOR PAYMENT OF CERTAIN

  7  SURVIVOR BENEFITS.--Notwithstanding any provision of this

  8  chapter to the contrary, for members with an effective date of

  9  retirement, or date of death if prior to retirement, on or

10  after January 1, 1996, the named joint annuitant, as defined

11  in s. 121.021(28)(b), who is eligible to receive benefits

12  under subparagraph (6)(a)3. or subparagraph (6)(a)4., shall

13  receive the maximum monthly retirement benefit that would have

14  been payable to the member under subparagraph (6)(a)1.;

15  however, payment of such benefit shall cease the month the

16  joint annuitant attains age 25 unless such joint annuitant is

17  disabled and incapable of self-support, in which case,

18  benefits shall cease when the joint annuitant is no longer

19  disabled.  The administrator may require proof of disability

20  or continued disability in the same manner as is provided for

21  a member seeking or receiving a disability retirement benefit

22  under subsection (4).

23         (13)  DEFERRED RETIREMENT OPTION PROGRAM.--In general,

24  and subject to the provisions of this section, the Deferred

25  Retirement Option Program, hereinafter referred to as the

26  DROP, is a program under which an eligible member of the

27  Florida  Retirement System may elect to participate, deferring

28  receipt of retirement benefits while continuing employment

29  with his or her Florida Retirement System employer.  The

30  deferred monthly benefits shall accrue in the System Trust

31  Fund on behalf of the participant, plus interest compounded

                                  62

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  monthly, for the specified period of the DROP participation,

  2  as provided in paragraph (c).  Upon termination of employment,

  3  the participant shall receive the total DROP benefits and

  4  begin to receive the previously determined normal retirement

  5  benefits. Employment in the DROP does not guarantee employment

  6  for the specified period of DROP.

  7         (a)  Eligibility of member to participate in the

  8  DROP.--All Florida Retirement System members are eligible to

  9  elect participation in the DROP provided that:

10         1.  Election to participate is made within 12 months

11  following the date on which the member first reaches normal

12  retirement date or age, or, for a member who first reached

13  normal retirement date or age prior to the effective date of

14  this section, election to participate is made within 12 months

15  after of the effective date of this section.  A member who

16  fails to make an election within such 12-month limitation

17  period shall forfeit all rights to participate in the DROP.

18  The member shall advise his or her employer and the division

19  in writing of the date on which the DROP shall begin. Such

20  beginning date may be subsequent to the 12-month election

21  period, but must be within the 60-month limitation period as

22  provided in subparagraph (b)1.

23         2.  The retiring member's employer, or employers if

24  dually employed, shall acknowledge in writing to the division

25  the date the member's participation in the DROP begins and the

26  date the member's employment and DROP participation will

27  terminate.

28         3.  Employment of a participant by additional Florida

29  Retirement System employers subsequent to the commencement of

30  participation in the DROP shall be permissible provided such

31  employers acknowledge in writing a DROP termination date no

                                  63

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  later than the participant's existing termination date or the

  2  60-month limitation period as provided in subparagraph (b)1.

  3         (b)  Participation in the DROP.--

  4         1.  An eligible member may elect to participate in the

  5  DROP for a period not to exceed a maximum of 60 months

  6  following the date on which the member first reaches his or

  7  her normal retirement age or date, including a member who

  8  first reaches his or her normal retirement age or date prior

  9  to the effective date of this section.  Any member who has

10  exceeded the 60-month limitation is shall not be eligible to

11  participate in the DROP.

12         2.  Upon deciding to participate in the DROP, the

13  member shall submit, on forms required by the division:

14         a.  A written election to participate in the DROP;

15         b.  Selection of the DROP participation and termination

16  dates, which satisfy the limitations stated in paragraph (a)

17  and subparagraph 1. Such termination date shall be in a

18  binding letter of resignation with the employer, establishing

19  a deferred termination date. The member may change the

20  termination date within the limitations of subparagraph 1.,

21  but only with the written approval of his employer;

22         c.  A properly completed DROP application for service

23  retirement as provided in this section; and

24         d.  Any other information required by the division.

25         3.  The DROP participant shall be a retiree under the

26  Florida Retirement System for all purposes, except for

27  paragraph (5)(f) and subsection (9) and ss. 112.3173, 112.363,

28  121.053, and 121.122.

29         4.  A reemployed retiree with renewed membership is not

30  eligible for DROP participation.

31

                                  64

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         5.  Elected officers shall be eligible to participate

  2  in the DROP subject to the following:

  3         a.  An elected or a nonelected participant may run for

  4  a term of office while participating in DROP and, if elected,

  5  extend the DROP termination date accordingly, except, however,

  6  if such additional term of office exceeds the 60-month

  7  limitation established in subparagraph 1., and the officer

  8  does not resign from office within such 60-month limitation,

  9  the retirement and the participant's DROP shall be null and

10  void as provided in sub-subparagraph (c)4.d.

11         b.  An elected officer who is dually employed and

12  elects to participate in DROP shall be required to satisfy the

13  definition of termination within the 60-month limitation

14  period as provided in subparagraph 1. for the nonelected

15  position and may continue employment as an elected officer as

16  provided in s. 121.053. The elected officer will be enrolled

17  as a renewed member in the Elected State and County Officers'

18  Class or the Regular Class, as provided in ss. 121.053 and

19  121.22, on the first day of the month after termination of

20  employment in the nonelected position and termination of DROP.

21  Distribution of the DROP benefits shall be made as provided in

22  paragraph (c).

23         (c)  Benefits payable under the DROP.--

24         1.  Effective with the date of DROP participation, the

25  member's initial normal monthly benefit, including creditable

26  service and average final compensation, and the effective date

27  of retirement shall be fixed. Such retirement benefit, the

28  annual cost of living adjustments provided in s. 121.101, and

29  interest shall accrue monthly in the System Trust Fund.  Such

30  interest shall accrue at an effective annual rate of 6.5

31

                                  65

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  percent compounded monthly, on the prior month's accumulated

  2  ending balance, up to the month of termination or death.

  3         2.  The effective date of retirement of a DROP

  4  participant shall be the first day of the month selected by

  5  the member to begin participation in the DROP.

  6         3.  Normal retirement benefits and interest thereon

  7  shall continue to accrue in the DROP until the established

  8  termination date of the DROP, or until the participant

  9  terminates employment or dies prior to such date. Although

10  individual DROP accounts shall not be established, a separate

11  accounting of each participant's accrued benefits under the

12  DROP shall be calculated and provided to participants

13  annually.

14         4.  At the conclusion of the participant's DROP, the

15  division shall distribute the participant's total accumulated

16  DROP benefits, subject to the following provisions:

17         a.  The division shall receive verification by the

18  participant's employer or employers that such participant has

19  terminated employment as provided in s. 121.021(39)(b).

20         b.  The terminated DROP participant or, if deceased,

21  such participant's named beneficiary, shall elect on forms

22  provided by the division to receive payment of the DROP

23  benefits in accordance with one of the options listed below.

24  For a participant or beneficiary who fails to elect a method

25  of payment within 60 days of termination of the DROP, the

26  division will pay a lump sum as provided in

27  sub-sub-subparagraph(I).

28         (I)  Lump sum.--All accrued DROP benefits, plus

29  interest, less withholding taxes remitted to the Internal

30  Revenue Service, shall be paid to the DROP participant or

31  surviving beneficiary.

                                  66

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         (II)  Direct rollover.--All accrued DROP benefits, plus

  2  interest, shall be paid from the DROP directly to the

  3  custodian of an eligible retirement plan as defined in s.

  4  402(c)(8)(B) of the Internal Revenue Code. However, in the

  5  case of an eligible rollover distribution to the surviving

  6  spouse of a deceased participant, an eligible retirement plan

  7  is an individual retirement account or an individual

  8  retirement annuity as described in s. 402(c)(9) of the

  9  Internal Revenue Code.

10         (III)  Partial lump sum.--A portion of the accrued DROP

11  benefits shall be paid to the DROP participant or surviving

12  spouse, less withholding taxes remitted to the Internal

13  Revenue Service, and the remaining DROP benefits shall be

14  transferred directly to the custodian of an eligible

15  retirement plan as defined in s. 402(c)(8)(B) of the Internal

16  Revenue Code. However, in the case of an eligible rollover

17  distribution to the surviving spouse of a deceased

18  participant, an eligible retirement plan is an individual

19  retirement account or an individual retirement annuity as

20  described in s. 402(c)(9) of the Internal Revenue Code. The

21  proportions shall be specified by the DROP participant or

22  surviving beneficiary.

23         c.  The form of payment selected by the DROP

24  participant or surviving beneficiary complies with the minimum

25  distribution requirements of the Internal Revenue Code and

26  payments begin no later than the date on which the participant

27  reaches age 70 years and 6 months.

28         d.  For a DROP participant who fails to terminate

29  employment as defined in s. 121.021(39)(b), the member shall

30  be deemed not to be retired and the DROP election shall be

31  null and void.  Florida Retirement System membership shall be

                                  67

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  reestablished retroactively to the date of the commencement of

  2  the DROP, and the employer shall be required to pay to the

  3  System Trust Fund the difference between the DROP

  4  contributions paid in paragraph (i) and the contributions

  5  required for the applicable Florida Retirement System class of

  6  membership during the period the member participated in the

  7  DROP, plus 6.5 percent interest compounded annually.

  8         5.  The accrued benefits of any DROP participant, and

  9  any contributions accumulated under such program, shall not be

10  subject to assignment, execution, attachment, or to any legal

11  process whatsoever, except for qualified domestic relations

12  orders by a court of competent jurisdiction, income deduction

13  orders as provided in s. 61.1301, and federal income tax

14  levies.

15         6.  DROP participants shall not be eligible for

16  disability retirement benefits as provided in subsection (4).

17         (d)  Death benefits under the DROP.--

18         1.  Upon the death of a DROP participant, the named

19  beneficiary shall be entitled to apply for and receive the

20  accrued benefits in the DROP as provided in sub-subparagraph

21  (c)4.b.

22         2.  The normal retirement benefit accrued to the DROP

23  during the month of a participant's death shall be the final

24  monthly benefit credited for such DROP participant.

25         3.  Eligibility to participate in the DROP terminates

26  upon death of the participant.  If the participant dies on or

27  after the effective date of enrollment in the DROP, but prior

28  to the first monthly benefit being credited to the DROP,

29  Florida Retirement System benefits shall be paid in accordance

30  with subparagraph (7)(c)1. or subparagraph 2.

31

                                  68

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         4.  A DROP participants' survivors shall not be

  2  eligible to receive Florida Retirement System death benefits

  3  as provided in paragraph (7)(d).

  4         (e)  Cost-of-living adjustment.--On each July 1, the

  5  participants' normal retirement benefit shall be increased as

  6  provided in s. 121.101.

  7         (f)  Retiree health insurance subsidy.--DROP

  8  participants are not eligible to apply for the retiree health

  9  insurance subsidy payments as provided in s. 112.363 until

10  such participants have terminated employment and participation

11  in the DROP.

12         (g)  Renewed membership.--DROP participants shall not

13  be eligible for renewed membership in the Florida Retirement

14  System under ss. 121.053 and 121.122 until termination of

15  employment is effectuated as provided in s. 121.021(39)(b).

16         (h)  Employment limitation after DROP

17  participation.--Upon satisfying the definition of termination

18  of employment as provided in s. 121.021(39)(b), DROP

19  participants shall be subject to such reemployment limitations

20  as other retirees. Reemployment restrictions applicable to

21  retirees as provided in subsection (9) shall not apply to DROP

22  participants until their employment and participation in the

23  DROP are terminated.

24         (i)  Contributions.--

25         1.  All employers paying the salary of a DROP

26  participant filling a regularly established position shall

27  contribute 11.56 percent of such participant's gross

28  compensation, which shall constitute the entire employer DROP

29  contribution with respect to such participant.  Such

30  contributions, payable to the System Trust Fund in the same

31  manner as required in s. 121.071, shall be made as appropriate

                                  69

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  for each pay period and are in addition to contributions

  2  required for social security and the Retiree Health Insurance

  3  Subsidy Trust Fund.  Such employer, social security, and

  4  health insurance subsidy contributions are not included in the

  5  DROP.

  6         2.  The employer shall, in addition to subparagraph 1.,

  7  also withhold one-half of the entire social security

  8  contribution required for the participant.  Contributions for

  9  social security by each participant and each employer, in the

10  amount required for social security coverage as now or

11  hereafter provided by the federal Social Security Act, shall

12  be in addition to contributions specified in subparagraph 1.

13         3.  All employers paying the salary of a DROP

14  participant filling a regularly established position shall

15  contribute 0.66 percent of such participant's gross

16  compensation, which shall constitute the employer's health

17  insurance subsidy contribution with respect to such

18  participant. Such contributions shall be deposited by the

19  administrator in the Retiree Health Insurance Subsidy Trust

20  Fund.

21         (j)  Forfeiture of retirement benefits.--Nothing in

22  this section shall be construed to remove DROP participants

23  from the scope of s. 8(d), Art. II of the State Constitution,

24  s. 112.3173, and paragraph (5)(f). DROP participants who

25  commit a specified felony offense while employed will be

26  subject to forfeiture of all retirement benefits, including

27  DROP benefits, pursuant to those provisions of law.

28         (k)  Administration of program.--The division shall

29  make such rules as are necessary for the effective and

30  efficient administration of this subsection. The division

31  shall not be required to advise members of the federal tax

                                  70

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  consequences of an election related to the DROP but may advise

  2  members to seek independent advice.

  3         (14)  PAYMENT OF BENEFITS.--This subsection applies to

  4  the payment of benefits to a payee (retiree or beneficiary)

  5  under the Florida Retirement System:

  6         (a)  Federal income tax shall be withheld in accordance

  7  with federal law, unless the payee elects otherwise on Form

  8  W-4P. The division shall prepare and distribute to each

  9  recipient of monthly retirement benefits an appropriate income

10  tax form that reflects the recipient's income and federal

11  income tax withheld for the calendar year just ended.

12         (b)  Subject to approval by the division in accordance

13  with rule 60S-4.015, Florida Administrative Code, a payee

14  receiving retirement benefits under the Florida Retirement

15  System may also have the following payments deducted from his

16  or her monthly benefit:

17         1.  Premiums for life and health-related insurance

18  policies from approved companies.

19         2.  Life insurance premiums for the State Group Life

20  Insurance Plan, if authorized in writing by the payee and by

21  the Division of State Group Insurance.

22         3.  Repayment of overpayments from the Florida

23  Retirement System Trust Fund, the State Employees' Health

24  Insurance Trust Fund, or the State Employees' Life Insurance

25  Trust Fund, upon notification of the payee.

26         4.  Payments to an alternate payee for alimony, child

27  support, or division of marital assets pursuant to a qualified

28  domestic relations order under s. 222.21 or an income

29  deduction order under s. 61.1301.

30

31

                                  71

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         5.  Payments to the Internal Revenue Service for

  2  federal income tax levies, upon notification of the division

  3  by the Internal Revenue Service.

  4         (c)  A payee shall notify the division of any change in

  5  his or her address. The division may suspend benefit payments

  6  to a payee if correspondence sent to the payee's mailing

  7  address is returned due to an incorrect address. Benefit

  8  payments shall be resumed upon notification to the division of

  9  the payee's new address.

10         Section 10.  Section 121.111, Florida Statutes, is

11  amended to read:

12         121.111  Credit for military service.--

13         (1)  Creditable service of any member shall also

14  include military service as defined in s. 121.021(20)(a) if:

15         (a)  The member is in the active employ of an employer

16  immediately prior to such service and leaves a position, other

17  than a temporary position, for the purpose of induction into

18  the Armed Forces of the United States or entry upon duty in

19  the Armed Forces of the United States. When applied to the

20  Florida Retirement System:

21         1.  The term "position other than a temporary position"

22  means a regularly established position with a Florida

23  Retirement System employer; and

24         2.  A member shall be construed to have left his or her

25  employment for military purposes if he or she reported for

26  active duty within 60 days after leaving such employment;

27         (b)  The member is entitled to reemployment under the

28  provisions of the Veterans' Reemployment Rights Act (38 U.S.C.

29  ss. 2021 et seq.);

30         (c)  The member applies for reemployment with the same

31  employer within the time set forth in s. 2021 or s. 2024 of

                                  72

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  the Veterans' Reemployment Rights Act, whichever is

  2  applicable, and is reemployed by such employer;

  3         (d)  The member makes the required employee

  4  contributions, if any, and the employer makes the required

  5  employer contributions for the employee's membership class for

  6  each month of service credit during such period of military

  7  service, based upon the employee's rate of monthly

  8  compensation as of the date that the employee left his or her

  9  position, plus 4 percent interest on such contributions

10  compounded annually from the due date of the contribution

11  until July 1, 1975, and 6.5 percent interest compounded

12  annually thereafter, until the payment is made to the proper

13  retirement trust fund; and

14         (e)  The period of service claimed pursuant to this

15  subsection does not exceed the periods specified by the

16  provisions of ss. 2021 and 2024 of the Veterans' Reemployment

17  Rights Act which are applicable in the member's case.

18         (2)  Any member whose initial date of employment is

19  before January 1, 1987, who has military service as defined in

20  s. 121.021(20)(b), and who does not claim such service under

21  subsection (1) may receive creditable service for such

22  military service if:

23         (a)  The member is vested has completed a minimum of 10

24  years of creditable service;

25         (b)  Creditable service, not to exceed a total of 4

26  years, is claimed only as service earned in the Regular Class

27  of membership; and

28         (c)  The member pays into the proper retirement trust

29  fund 4 percent of gross salary, based upon his or her first

30  year of salary subsequent to July 1, 1945, that he or she has

31  credit for under this system, plus 4 percent interest thereon

                                  73

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  compounded annually from the date of first creditable service

  2  under this chapter until July 1, 1975, and 6.5 percent

  3  interest compounded annually thereafter, until payment is made

  4  to the proper retirement trust fund.

  5         (d)  The member may not receive credit for any wartime

  6  military service if the member also receives credit for such

  7  service under any federal, state, or local retirement or

  8  pension system where "length of service" is a factor in

  9  determining the amount of compensation received. However,

10  credit for wartime military service may be received where the

11  member also receives credit under a pension system providing

12  retired pay for nonregular service in the Armed Forces of the

13  United States in accordance with 10 U.S.C. ss. 1331 et seq.,

14  as follows:

15         1.  Any person whose retirement date under the Florida

16  Retirement System is prior to July 1, 1985, may claim such

17  service at any time, as provided in this subsection, upon

18  payment of contributions and interest as provided in paragraph

19  (c), with interest computed to the retired member's retirement

20  date. The benefit shall be recalculated and increased to

21  include the additional service credit granted for such wartime

22  military service, and a lump-sum payment shall be made to the

23  retiree for the amount owed due to the additional service

24  credit, retroactive to the date of retirement.

25         2.  Any person whose retirement date is on or after

26  July 1, 1985, must claim such service and pay the required

27  contributions, as provided in paragraph (c), prior to the

28  commencement of his or her retirement benefits, as provided in

29  this subsection.

30         (e)  Any member claiming credit under this subsection

31  must certify on the form prescribed by the division that

                                  74

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  credit for such service has not and will not be claimed for

  2  retirement purposes under any other federal, state, or local

  3  retirement or pension system where "length of service" is a

  4  factor in determining the amount of compensation received,

  5  except where credit for such service has been granted in a

  6  pension system providing retired pay for nonregular service as

  7  provided in paragraph (d). If the member dies prior to

  8  retirement, the member's beneficiary must make the required

  9  certification before credit may be claimed. If such

10  certification is not made by the member or the member's

11  beneficiary, credit for wartime military service shall not be

12  allowed.

13         (f)  Service credit awarded for wartime military

14  service shall be the total number of years, months, and days

15  from and including the date of entry into active duty through

16  the date of discharge from active duty, up to a maximum of 4

17  years. If the military service includes a partial year, it

18  shall be stated as a fraction of a year. Creditable military

19  service shall be calculated in accordance with rule

20  60S-2.005(2)(j), Florida Administrative Code.

21         (3)  Except as provided by law or rule, the employer is

22  not required to make contributions for military service credit

23  for any member.

24         Section 11.  Section 121.121, Florida Statutes, is

25  amended to read:

26         121.121  Future service to include Authorized leaves of

27  absence.--A member may purchase creditable service for Future

28  service of any member as defined in s. 121.021(21) shall also

29  include up to 2 work years of creditable service for

30  authorized leaves of absence if:

31

                                  75

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1         (1)  The member has completed a minimum of 10 years of

  2  creditable service, excluding periods for which a of leave of

  3  absence was authorized;

  4         (2)  The leave of absence is authorized in writing by

  5  the employer of the member and approved by the administrator;

  6         (3)  The member returns to active employment performing

  7  service with a Florida Retirement System employer in a

  8  regularly established position immediately upon termination of

  9  the leave of absence and remains on the employer's payroll for

10  1 calendar month, except that a member who retires on

11  disability while on a medical leave of absence shall not be

12  required to return to employment. A member whose work year is

13  less than 12 months and whose leave of absence terminates

14  between school years is eligible to receive credit for the

15  leave of absence as long as he or she returns to the

16  employment of his or her employer at the beginning of the next

17  school year and remains on the employer's payroll for 1

18  calendar month; and

19         (4)  The member makes the required contributions for

20  service credit during the leave of absence, which shall be 8

21  percent until January 1, 1975, and 9 percent thereafter of his

22  or her rate of monthly compensation in effect immediately

23  prior to the commencement of such leave for each month of such

24  period, plus 4 percent interest until July 1, 1975, and 6.5

25  percent interest thereafter on such contributions, compounded

26  annually each June 30 from the due date of the contribution to

27  date of payment. Effective July 1, 1980, any leave of absence

28  purchased pursuant to this section shall be at the

29  contribution rates specified in s. 121.071 in effect at the

30  time the leave is granted for the class of membership from

31  which the leave of absence was granted; however, any member

                                  76

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  who purchased leave-of-absence credit prior to July 1, 1980,

  2  for a leave of absence from a position in a class other than

  3  the regular membership class, may pay the appropriate

  4  additional contributions plus compound interest thereon and

  5  receive creditable service for such leave of absence in the

  6  membership class from which the member was granted the leave

  7  of absence.

  8         Section 12.  Subsection (3) of section 121.122, Florida

  9  Statutes, is amended to read:

10         121.122  Renewed membership in system.--Except as

11  provided in s. 121.053, effective July 1, 1991, any retiree of

12  a state-administered retirement system who is employed in a

13  regularly established position with a covered employer shall

14  be enrolled as a compulsory member of the Regular Class of the

15  Florida Retirement System or, effective July 1, 1997, any

16  retiree of a state-administered retirement system who is

17  employed in a position included in the Senior Management

18  Service Class shall be enrolled as a compulsory member of the

19  Senior Management Service Class of the Florida Retirement

20  System as provided in s. 121.055, and shall be entitled to

21  receive an additional retirement benefit, subject to the

22  following conditions:

23         (3)  Such member shall be entitled to purchase

24  additional retirement credit in the Regular Class for any

25  postretirement service performed in a regularly established

26  position prior to July 1, 1991, by paying the Regular Class

27  applicable employee and employer contributions for the period

28  being claimed, plus 4 percent interest compounded annually

29  from first year of service claimed until July 1, 1975, and 6.5

30  percent interest compounded thereafter, until full payment is

31  made to the Florida Retirement System Trust Fund.  The

                                  77

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  contribution for postretirement service between July 1, 1985,

  2  and July 1, 1991, for which the reemployed retiree

  3  contribution was paid, shall be the difference between such

  4  contribution and the total applicable contribution for the

  5  period being claimed, plus interest.  The employer of such

  6  member may pay the applicable employer contribution in lieu of

  7  the member. If a member does not wish to claim credit for all

  8  of the postretirement service for which he or she is eligible,

  9  the service the member claims must be the most recent service.

10         Section 13.  Section 121.193, Florida Statutes, is

11  created to read:

12         121.193  External compliance audits.--

13         (1)  The division shall conduct audits of the payroll

14  and personnel records of participating agencies. These audits

15  shall be made to determine the accuracy of reports submitted

16  to the division and to assess the degree of compliance with

17  applicable statutes, rules, and coverage agreements. Audits

18  shall be scheduled on a regular basis, as the result of

19  concerns known to exist at an agency, or as a follow-up to

20  ensure agency action was taken to correct deficiencies found

21  in an earlier audit.

22         (2)  Upon request, participating agencies shall furnish

23  the division with information and documents that the division

24  requires to conduct the audit. The division may prescribe by

25  rule the documents that may be requested.

26         (3)  The division shall review the agency's operations

27  concerning retirement and social security coverage.

28  Preliminary findings shall be discussed with agency personnel

29  at the close of the audit. An audit report of findings and

30  recommendations shall be submitted to division management and

31

                                  78

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  an audit summary letter shall be submitted to the agency

  2  noting any concerns and necessary corrective action.

  3         Section 14.  Subsections (1), (4), and (5), and

  4  paragraph (a) of subsection (6) of section 121.35, Florida

  5  Statutes, are amended to read:

  6         121.35  Optional retirement program for the State

  7  University System.--

  8         (1)  OPTIONAL RETIREMENT PROGRAM ESTABLISHED.--The

  9  Division of Retirement shall establish an optional retirement

10  program under which contracts providing retirement and death

11  benefits may be purchased for eligible members of the State

12  University System who elect to participate in the program. The

13  benefits to be provided for or on behalf of participants in

14  such optional retirement program shall be provided through

15  individual contracts or individual certificates issued for

16  group annuity contracts, which may be fixed, variable, or a

17  combination thereof, in accordance with s. 403(b) of the

18  Internal Revenue Code. Any individual contract or certificate

19  shall state the annuity plan on its face page, and shall

20  include, but not be limited to, a statement of ownership, the

21  contract benefits, annuity income options, limitations,

22  expense charges, and surrender charges, if any. The state

23  shall contribute, as provided in this section, toward the

24  purchase of such optional benefits.

25         (4)  CONTRIBUTIONS.--

26         (a)  Each employer shall contribute on behalf of each

27  participant in the optional retirement program an amount equal

28  to the normal cost portion of the employer retirement

29  contribution which would be required if the participant were a

30  regular member of the Florida Retirement System, plus the

31  portion of the contribution rate required in s. 112.363(8)

                                  79

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  that would otherwise be assigned to the Retiree Health

  2  Insurance Subsidy Trust Fund, less an amount approved by the

  3  Legislature which shall be deducted by the division to provide

  4  for the administration of this program. The payment of the

  5  contributions to the optional program which is required by

  6  this paragraph for each participant shall be made by the

  7  employer to the division, which shall forward the

  8  contributions to the designated company or companies

  9  contracting for payment of benefits for the participant under

10  the program. However, such contributions paid on behalf of an

11  employee described in paragraph (3)(c) shall not be forwarded

12  to a company and shall not begin to accrue interest until the

13  employee has executed an annuity contract and notified the

14  division.

15         (b)  Each employer shall contribute on behalf of each

16  participant in the optional retirement program an amount equal

17  to the unfunded actuarial accrued liability portion of the

18  employer contribution which would be required for members of

19  the Florida Retirement System.  This contribution shall be

20  paid to the division for transfer to the Florida Retirement

21  System Trust Fund.

22         (c)  An Optional Retirement Program Trust Fund shall be

23  established in the State Treasury and administered by the

24  Division of Retirement to make payments to the provider

25  companies on behalf of the Optional Retirement Program

26  participants, and to transfer the unfunded liability portion

27  of the state Optional Retirement Program contributions to the

28  Florida Retirement System Trust Fund.

29         (d)(c)  Contributions required for social security by

30  each employer and each participant, in the amount required for

31  social security coverage as now or hereafter may be provided

                                  80

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  by the federal Social Security Act, shall be maintained for

  2  each participant in the optional retirement program and shall

  3  be in addition to the retirement contributions specified in

  4  this subsection.

  5         (e)(d)  Each participant in the optional retirement

  6  program who has executed an annuity contract may contribute by

  7  way of salary reduction or deduction a percentage amount of

  8  the participant's gross compensation not to exceed the

  9  percentage amount contributed by the employer to the optional

10  program, but in no case may such contribution exceed federal

11  limitations. Payment of the participant's contributions shall

12  be made by the financial officer of the employer to the

13  division which shall forward the contributions to the

14  designated company or companies contracting for payment of

15  benefits for the participant under the program. A participant

16  may not make, through salary reduction, any voluntary employee

17  contributions to any other plan under s. 403(b) of the

18  Internal Revenue Code, with the exception of a custodial

19  account under s. 403(b)(7) of the Internal Revenue Code, until

20  he or she has made an employee contribution to his or her

21  optional program equal to the employer contribution. A

22  participant is responsible for monitoring his or her

23  individual tax-deferred income to insure he or she does not

24  exceed the maximum deferral amounts permitted under the

25  Internal Revenue Code.

26         (5)  BENEFITS.--

27         (a)  Benefits shall be payable under the optional

28  retirement program only to vested participants in the program,

29  or their beneficiaries as designated by the participant in the

30  contract with a provider company, and such benefits shall be

31  paid only by the designated company in accordance with the

                                  81

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  terms of the annuity contract or contracts applicable to the

  2  participant. The participant must be terminated from all

  3  employment with all Florida Retirement System employers, as

  4  provided in s. 121.021(39), to begin receiving the

  5  employer-funded benefit. Benefits funded by employer

  6  contributions shall be payable only as a lifetime annuity to

  7  the participant, his beneficiary, or his estate, except for:

  8         1.  A lump-sum payment to the beneficiary upon the

  9  death of the participant; or

10         2.  A cash-out of a de minimis account upon the request

11  of a former participant who has been terminated for a minimum

12  of 6 months from the employment that entitled him to Optional

13  Retirement Program participation. A de minimis account is an

14  account with a provider company containing employer

15  contributions and accumulated earnings of not more than $3,500

16  made under the provisions of this chapter. Such cash-out must

17  be a complete liquidation of the account balance with that

18  company and is subject to the provisions of the Internal

19  Revenue Code.

20         (b)  The benefits payable to any person under the

21  optional retirement program, and any contribution accumulated

22  under such program, shall not be subject to assignment,

23  execution, or attachment or to any legal process whatsoever.

24         (c)  A participant who chooses to receive his or her

25  benefits upon termination of employment shall have

26  responsibility to notify the provider company of the date on

27  which he or she wishes the annuity funded by employer

28  contributions to begin. Benefits may be deferred until such

29  time as the participant chooses to make such application.

30         (d)  Benefits funded by the participant's personal

31  contributions may be paid out at any time and in any form

                                  82

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  within the limits provided in the contract between the

  2  participant and his or her provider company. The participant

  3  shall notify the provider company regarding the date and

  4  provisions under which he or she wants to receive the

  5  employee-funded portion of the plan.

  6         (6)  ADMINISTRATION OF PROGRAM.--

  7         (a)  The optional retirement program authorized by this

  8  section shall be administered by the division.  The division

  9  shall adopt rules establishing the responsibilities of the

10  Board of Regents and institutions in the State University

11  System in administering the optional retirement program. The

12  Board of Regents shall, no more than 90 days after July 1,

13  1983, submit to the division its recommendations for the

14  annuity contracts to be offered by the companies chosen by the

15  division.  The recommendations of the board shall include the

16  following:

17         1.  The nature and extent of the rights and benefits in

18  relation to the required contributions; and

19         2.  The suitability of the rights and benefits to the

20  needs of the participants and the interests of the

21  institutions in the recruitment and retention of eligible

22  employees.

23         Section 15.  Subsection (6) of section 121.40, Florida

24  Statutes, is amended to read:

25         121.40  Cooperative extension personnel at the

26  Institute of Food and Agricultural Sciences; supplemental

27  retirement benefits.--

28         (6)  PAYMENT OF SUPPLEMENT.--Any participant who

29  retires on or after January 1, 1985, from the federal Civil

30  Service Retirement System as a cooperative extension employee

31  of the institute at the University of Florida and who

                                  83

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






    Florida Senate - 1998                           CS for SB 1684
    302-1820-98




  1  satisfies all of the eligibility criteria specified in

  2  subsection (4) shall be entitled to receive a supplemental

  3  benefit computed in accordance with subsection (5), to begin

  4  July 1, 1985, or the month of retirement, or the month in

  5  which the participant becomes age 62, whichever is later.

  6  Upon application to the administrator, the participant shall

  7  receive a monthly supplemental benefit which shall commence on

  8  the last day of the month of retirement and shall be payable

  9  on the last day of the month thereafter during his or her

10  lifetime. A participant may have federal income tax and health

11  insurance premiums deducted from his or her monthly

12  supplemental benefit in the same manner as provided in s.

13  121.091(14)(a) and (b) for monthly retirement benefits under

14  the Florida Retirement System.

15         Section 16.  It is the intent of the Legislature that

16  the amendments to sections 121.021, 121.051, 121.0515,

17  121.052, 121.053, 121.055, 121.071, 121.081, 121.091, 121.111,

18  121.121, 121.122, 121.35, and 121.40, Florida Statutes, made

19  by this act are intended to be supplemental to other

20  amendments to those sections which are enacted at the 1998

21  regular session of the Legislature, unless a contrary intent

22  is specifically indicated in this act or in such other

23  amendments.

24         Section 17.  This act shall take effect July 1, 1998.

25

26          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
27                         Senate Bill 1684

28

29  The committee substitute amends the bill to provide additional
    authorization for administrative rules identified by the
30  agency as exceeding statutory authority and reported to the
    Joint Administrative Procedures Committee pursuant to s.
31  120.536, F.S. Additionally, language which did not pertain to
    rule authorization was removed from the bill.
                                  84