Senate Bill 0354
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Florida Senate - 1999 SB 354
By the Committee on Governmental Oversight and Productivity
302-571-99
1 A bill to be entitled
2 An act relating to the Florida Retirement
3 System; amending s. 121.055, F.S.;
4 redesignating the Senior Management Service
5 Class as the Senior Management and Exempt
6 Service Class; providing for state employees
7 who are exempt from the Career Service System
8 to participate in the Senior Management and
9 Exempt Service Class; authorizing such members
10 to elect to participate in the Senior
11 Management Service Optional Annuity Program;
12 specifying forms of benefit payments that are
13 made under the optional annuity program;
14 providing requirements for electing to
15 participate in the optional annuity program;
16 amending ss. 121.021, 121.051, 121.052,
17 121.091, 121.122, F.S., relating to the Florida
18 Retirement System, the optional annuity
19 program, the Elected State Officers' Class,
20 retirement benefits, and renewed membership in
21 the retirement system; providing an effective
22 date.
23
24 Be It Enacted by the Legislature of the State of Florida:
25
26 Section 1. Section 121.055, Florida Statutes, 1998
27 Supplement, is amended to read:
28 121.055 Senior Management and Exempt Service
29 Class.--There is hereby established a separate class of
30 membership within the Florida Retirement System to be known as
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1 the "Senior Management and Exempt Service Class," which shall
2 become effective July 1, 2000 February 1, 1987.
3 (1)(a) Participation in the Senior Management and
4 Exempt Service Class shall be limited to and compulsory for
5 any member of the Florida Retirement System who holds a
6 position in the Senior Management Service of the State of
7 Florida, established by part III of chapter 110, the Selected
8 Exempt Service System established by part V of chapter 110, or
9 is otherwise exempt from the Career Service System, unless
10 such member elects, within the time specified in this section
11 herein, to participate in the Senior Management Service
12 Optional Annuity Program as established in subsection (6).
13 (b)1. Except as provided in subparagraph 2., effective
14 January 1, 1990, participation in the Senior Management and
15 Exempt Service Class shall be compulsory for the president of
16 each community college, the manager of each participating city
17 or county, and all appointed district school superintendents.
18 Effective January 1, 1994, additional positions may be
19 designated for inclusion in the Senior Management and Exempt
20 Service Class of the Florida Retirement System, provided that:
21 a. Positions to be included in the class shall be
22 designated by the local agency employer. Notice of intent to
23 designate positions for inclusion in the class shall be
24 published once a week for 2 consecutive weeks in a newspaper
25 of general circulation published in the county or counties
26 affected, as provided in chapter 50.
27 b. One nonelective full-time position may be
28 designated for each local agency employer reporting to the
29 Division of Retirement; for local agencies with 100 or more
30 regularly established positions, additional nonelective
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1 full-time positions may be designated, not to exceed 1 percent
2 of the regularly established positions within the agency.
3 c. Each position added to the class must be a
4 managerial or policymaking position filled by an employee who
5 is not subject to continuing contract and serves at the
6 pleasure of the local agency employer without civil service
7 protection, and who:
8 (I) Heads an organizational unit; or
9 (II) Has responsibility to effect or recommend
10 personnel, budget, expenditure, or policy decisions in his or
11 her areas of responsibility.
12 2. In lieu of participation in the Senior Management
13 and Exempt Service Class, members of the Senior Management and
14 Exempt Service Class pursuant to the provisions of
15 subparagraph 1. may withdraw from the Florida Retirement
16 System altogether and participate in a lifetime monthly
17 annuity program that which may be provided by the employing
18 agency. The cost to the employer for such annuity shall equal
19 the normal cost portion of the contributions required in the
20 Senior Management and Exempt Service Class. The employer
21 providing such annuity shall contribute an additional amount
22 to the Florida Retirement System Trust Fund equal to the
23 unfunded actuarial accrued liability portion of the Senior
24 Management and Exempt Service Class contribution rate. The
25 decision to participate in such local government annuity is
26 shall be irrevocable for as long as the employee holds a
27 position eligible for the annuity. Any service creditable
28 under the Senior Management and Exempt Service Class shall be
29 retained after the member withdraws from the Florida
30 Retirement System; however, additional service credit in the
31 Senior Management and Exempt Service Class may shall not be
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1 earned after such withdrawal. Such members are shall not be
2 eligible to participate in the Senior Management Service
3 Optional Annuity Program. Benefits may be payable in the form
4 of a lifetime annuity, a full or partial cash distribution, or
5 a full or partial rollover to a tax-qualified account.
6 (c)1. Effective January 1, 1990, participation in the
7 Senior Management and Exempt Service Class shall be compulsory
8 for up to 75 nonelective positions at the level of committee
9 staff director or higher or equivalent managerial or
10 policymaking positions within the House of Representatives, as
11 selected by the Speaker of the House of Representatives, up to
12 50 nonelective positions at the level of committee staff
13 director or higher or equivalent managerial or policymaking
14 positions within the Senate, as selected by the President of
15 the Senate, all staff directors of joint committees and
16 service offices of the Legislature, the Auditor General and up
17 to 9 managerial or policymaking positions within his or her
18 office as selected by the Auditor General, and the executive
19 director of the Commission on Ethics.
20 2. Participation in this class shall be compulsory,
21 except as provided in subparagraph 3., for any legislative
22 employee who holds a position designated for coverage in the
23 Senior Management and Exempt Service Class, and such
24 participation shall continue until the employee terminates
25 employment in a covered position.
26 3. In lieu of participation in the Senior Management
27 and Exempt Service Class, at the discretion of the President
28 of the Senate and the Speaker of the House of Representatives,
29 such members may participate in the Senior Management Service
30 Optional Annuity Program as established in subsection (6).
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1 (d) Effective January 1, 1991, participation in the
2 Senior Management and Exempt Service Class shall be compulsory
3 for any member of the Florida Retirement System in a position
4 that has been designated eligible for inclusion in the
5 Executive Service of the State University System or who holds
6 a position as president of a state university, unless such
7 member elects, pursuant to s. 121.35, to participate in the
8 optional retirement program.
9 (e) Effective January 1, 1991, participation in the
10 Senior Management and Exempt Service Class shall be compulsory
11 for the number of senior managers who have policymaking
12 authority with the State Board of Administration, as
13 determined by the Governor, Treasurer, and Comptroller acting
14 as the State Board of Administration, unless such member
15 elects to participate in the Senior Management Service
16 Optional Annuity Program as established in subsection (6) in
17 lieu of participation in the Senior Management and Exempt
18 Service Class. Such election shall be made in writing and
19 filed with the division and the personnel officer of the State
20 Board of Administration within 90 days after becoming eligible
21 for membership in the Senior Management and Exempt Service
22 Class.
23 (f) Effective July 1, 1997:
24 1. Any elected state officer eligible for membership
25 in the Elected State and County Officers' Class under s.
26 121.052(2)(a), (b), or (c) who elects membership in the Senior
27 Management and Exempt Service Class under s. 121.052(3)(c)
28 may, within 6 months after assuming office or within 6 months
29 after this act becomes a law for serving elected state
30 officers, elect to participate in the Senior Management
31 Service Optional Annuity Program, as provided in subsection
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1 (6), in lieu of membership in the Senior Management and Exempt
2 Service Class.
3 2. Any elected county officer eligible for membership
4 in the Elected State and County Officers' Class under s.
5 121.052(2)(d) who elects membership in the Senior Management
6 and Exempt Service Class under s. 121.052(3)(c) may, within 6
7 months after assuming office, or within 6 months after this
8 act becomes a law for serving elected county officers, elect
9 to participate in a lifetime monthly annuity program, as
10 provided in subparagraph (b)2., in lieu of membership in the
11 Senior Management and Exempt Service Class.
12 (g) Effective July 1, 1996, participation in the
13 Senior Management and Exempt Service Class shall be compulsory
14 for any member of the Florida Retirement System employed with
15 the Department of Military Affairs in the positions of the
16 Adjutant General, Assistant Adjutant General-Army, Assistant
17 Adjutant General-Air, State Quartermaster, Director of
18 Military Personnel, Director of Administration, and additional
19 directors as designated by the agency head, not to exceed a
20 total of 10 positions. In lieu of participation in the Senior
21 Management and Exempt Service Class, such members may
22 participate in the Senior Management Service Optional Annuity
23 Program as established in subsection (6).
24 (h)1. Except as provided in subparagraph 3., effective
25 January 1, 1994, participation in the Senior Management and
26 Exempt Service Class shall be compulsory for the State Courts
27 Administrator and the Deputy State Courts Administrators, the
28 Clerk of the Supreme Court, the Marshal of the Supreme Court,
29 the Executive Director of the Justice Administrative
30 Commission, the Capital Collateral Representative, the clerks
31 of the district courts of appeals, the marshals of the
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1 district courts of appeals, and the trial court administrator
2 in each judicial circuit. Effective January 1, 1994,
3 additional positions in the offices of the state attorney and
4 public defender in each judicial circuit may be designated for
5 inclusion in the Senior Management and Exempt Service Class of
6 the Florida Retirement System, provided that:
7 a. Positions to be included in the class shall be
8 designated by the state attorney or public defender, as
9 appropriate. Notice of intent to designate positions for
10 inclusion in the class shall be published once a week for 2
11 consecutive weeks in a newspaper of general circulation
12 published in the county or counties affected, as provided in
13 chapter 50.
14 b. One nonelective full-time position may be
15 designated for each state attorney and public defender
16 reporting to the Division of Retirement; for agencies with 200
17 or more regularly established positions under the state
18 attorney or public defender, additional nonelective full-time
19 positions may be designated, not to exceed 0.5 percent of the
20 regularly established positions within the agency.
21 c. Each position added to the class must be a
22 managerial or policymaking position filled by an employee who
23 serves at the pleasure of the state attorney or public
24 defender without civil service protection, and who:
25 (I) Heads an organizational unit; or
26 (II) Has responsibility to effect or recommend
27 personnel, budget, expenditure, or policy decisions in his or
28 her areas of responsibility.
29 2. Participation in this class shall be compulsory,
30 except as provided in subparagraph 3., for any judicial
31 employee who holds a position designated for coverage in the
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1 Senior Management and Exempt Service Class and such
2 participation shall continue until the employee terminates
3 employment in a covered position.
4 3. In lieu of participation in the Senior Management
5 and Exempt Service Class, such members may participate in the
6 Senior Management Service Optional Annuity Program as
7 established in subsection (6).
8 (i) Except as may otherwise be provided, any member of
9 the Senior Management and Exempt Service Class may purchase
10 additional retirement credit in such class for creditable
11 service within the purview of the Senior Management and Exempt
12 Service Class retroactive to February 1, 1987, and may upgrade
13 retirement credit for such service, to the extent of 2 percent
14 of the member's average monthly compensation as specified in
15 paragraph (4)(d) for such service. Contributions for upgrading
16 the additional Senior Management and Exempt Service credit
17 pursuant to this paragraph shall be equal to the difference in
18 the contributions paid and the Senior Management and Exempt
19 Service Class contribution rate as a percentage of gross
20 salary in effect for the period being claimed, plus interest
21 thereon at the rate of 6.5 percent a year, compounded annually
22 until the date of payment. This service credit may be
23 purchased by the employer on behalf of the member.
24 (2)(a) Participation in this class shall cease when
25 the member terminates employment in an eligible position.
26 Once a position is designated as eligible for inclusion in the
27 class, that position shall not be removed from the class
28 unless the duties and responsibilities of the position change
29 substantially and therefore no longer meet the requirements
30 provided in this section for participation in the class,
31 except as provided in paragraph (b).
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1 (b) Effective July 1, 1997, each local agency employer
2 may between July 1, 1997, and December 31, 1997, reassess its
3 designation of positions for inclusion in the Senior
4 Management and Exempt Service Class as provided in paragraph
5 (1)(b), and may request removal from the class of any such
6 positions that it deems appropriate. Such removal of any
7 previously designated positions shall be effective on the
8 first day of the month following written notification of
9 removal to the division prior to January 1, 1998.
10 (3)(a) The following table states the required
11 retirement contribution rates for members of the Senior
12 Management and Exempt Service Class and their employers in
13 terms of a percentage of the member's gross compensation. A
14 change in the contribution rate is effective with the first
15 salary paid on or after the beginning date of the change.
16 Contributions shall be made for each pay period and are in
17 addition to the contributions required for social security and
18 the Retiree Health Insurance Subsidy Trust Fund.
19
20 Dates of Contribution
21 Rate Changes Members Employers
22
23 February 1, 1987, through
24 December 31, 1988 0% 13.88%
25 January 1, 1989, through
26 December 31, 1989 0% 14.95%
27 January 1, 1990, through
28 December 31, 1990 0% 16.04%
29 January 1, 1991, through
30 December 31, 1991 0% 18.39%
31 January 1, 1992, through
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1 December 31, 1992 0% 19.48%
2 January 1, 1993, through
3 December 31, 1993 0% 20.55%
4 January 1, 1994, through
5 December 31, 1994 0% 23.07%
6 January 1, 1995, through
7 December 31, 1995 0% 23.88%
8 January 1, 1996, through
9 June 30, 1996 0% 24.14%
10 July 1, 1996, through
11 June 30, 1998 0% 21.58%
12 Effective July 1, 1998 0% 23.10%
13
14 (b) The employer paying the salary of a member of the
15 Senior Management and Exempt Service Class shall contribute an
16 amount as specified in this section which shall constitute the
17 entire employer retirement contribution with respect to such
18 member. The employer shall also withhold one-half of the
19 entire contribution of the member required for social security
20 coverage.
21 (c) The following table states the required employer
22 contribution on behalf of each member of the Senior Management
23 and Exempt Service Class in terms of a percentage of the
24 member's gross compensation. Such contribution constitutes
25 the entire health insurance subsidy contribution with respect
26 to the member. A change in the contribution rate is effective
27 with the first salary paid on or after the beginning date of
28 the change. The retiree health insurance subsidy contribution
29 rate is as follows:
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1 Dates of Contribution Contribution
2 Rate Changes Rate
3
4 October 1, 1987, through December 31, 1988 0.24%
5 January 1, 1989, through December 31, 1993 0.48%
6 January 1, 1994, through December 31, 1994 0.56%
7 January 1, 1995, through June 30, 1998 0.66%
8 Effective July 1, 1998 0.94%
9
10 Such contributions shall be deposited by the administrator in
11 the Retiree Health Insurance Subsidy Trust Fund.
12 (4)(a) The definitions set forth in s. 121.021 and all
13 other provisions of this chapter shall apply to the Senior
14 Management and Exempt Service Class, except the definitions
15 and provisions in conflict with, or superseded or modified by,
16 the provisions of this section.
17 (b) Service in an eligible position prior to February
18 1, 1987, or after January 31, 1987, shall satisfy the
19 requirement of attaining the normal retirement date as defined
20 in s. 121.021(29) for a Senior Management and Exempt Service
21 Class member, provided the employee is a member of the Senior
22 Management and Exempt Service Class after January 31, 1987. A
23 member of this class who fails to complete 7 years of
24 creditable service in an eligible position shall be required
25 to satisfy the requirements for the normal retirement date for
26 a regular member as provided in s. 121.021(29).
27 (c) The average final compensation of a member of this
28 class shall be as defined in s. 121.021(24).
29 (d) A member of the Senior Management and Exempt
30 Service Class shall receive retirement credit at the rate of 2
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1 percent of average final compensation for each year of service
2 in such class after January 31, 1987.
3 (5) A member of the Senior Management and Exempt
4 Service Class shall retain all rights and creditable service
5 accumulated in the Florida Retirement System prior to
6 membership in the Senior Management and Exempt Service Class.
7 (6)(a) Senior Management Service Optional Annuity
8 Program.--The Department of Management Services shall
9 establish a Senior Management Service Optional Annuity Program
10 under which contracts providing retirement, death, and
11 disability benefits may be purchased for those employees who
12 elect to participate in the optional annuity program. The
13 benefits to be provided for or on behalf of participants in
14 such optional annuity 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. 401(a) of the
18 Internal Revenue Code. Any such individual contract or
19 certificate shall state the annuity plan on its face page, and
20 shall include, but not be limited to, a statement of
21 ownership, the contract benefits, annuity income options,
22 limitations, expense charges, and surrender charges, if any.
23 The employing agency shall contribute, as provided in this
24 section, toward the purchase of such optional benefits which
25 shall be fully and immediately vested in the participants.
26 (b) Retirement service credit.--An eligible employee
27 who is a member of the Florida Retirement System or an
28 existing retirement system at the time of his or her election
29 to participate in the Senior Management Service Optional
30 Annuity Program shall retain all retirement service credit
31 earned under the retirement system from which he or she
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1 transferred; however, no additional service credit in the
2 Florida Retirement System or existing retirement system shall
3 be earned while the employee participates in the optional
4 annuity program, nor shall the employee be eligible for
5 disability retirement under the Florida Retirement System or
6 existing retirement system.
7 (c) Participation.--
8 1. Any eligible employee who is employed on or before
9 July 1, 2000 February 1, 1987, may elect to participate in the
10 optional annuity program in lieu of participation in the
11 Senior Management and Exempt Service Class. Such election
12 shall be made in writing and filed with the department and the
13 personnel officer of the employer on or before June 30, 2000
14 May 1, 1987. Any eligible employee who is employed on or
15 before July 1, 2000 February 1, 1987, and who fails to make an
16 election to participate in the optional annuity program by
17 June 30, 2000 May 1, 1987, shall be deemed to have elected
18 membership in the Senior Management and Exempt Service Class.
19 2. Any employee who becomes eligible to participate in
20 the optional annuity program by reason of initial employment
21 commencing after July 1, 2000 February 1, 1987, may, within 90
22 days after the date of commencement of employment, elect to
23 participate in the optional annuity program. Such election
24 shall be made in writing and filed with the personnel officer
25 of the employer. Any eligible employee who does not within 90
26 days after commencement of such employment elect to
27 participate in the optional annuity program shall be deemed to
28 have elected membership in the Senior Management and Exempt
29 Service Class.
30 3. A person who is appointed to a position in the
31 Senior Management and Exempt Service Class and who is a member
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1 of an existing retirement system or the Special Risk or
2 Special Risk Administrative Support Classes of the Florida
3 Retirement System may elect to remain in such system or class
4 in lieu of participation in the Senior Management and Exempt
5 Service Class or optional annuity program. Such election shall
6 be made in writing and filed with the department and the
7 personnel officer of the employer within 90 days of such
8 appointment. Any eligible employee who fails to make an
9 election to participate in the existing system, the Special
10 Risk Class of the Florida Retirement System, the Special Risk
11 Administrative Support Class of the Florida Retirement System,
12 or the optional annuity program shall be deemed to have
13 elected membership in the Senior Management and Exempt Service
14 Class.
15 4. An employee's election to participate in the
16 optional annuity program is irrevocable as long as such
17 employee continues to be employed in an eligible position and
18 continues to meet the eligibility requirements set forth in
19 this paragraph.
20 (d) Contributions.--
21 1. Each employer shall contribute on behalf of each
22 participant in the Senior Management Service Optional Annuity
23 Program an amount equal to the normal cost portion of the
24 employer retirement contribution which would be required if
25 the participant were a Senior Management and Exempt Service
26 Class member of the Florida Retirement System, plus the
27 portion of the contribution rate required in s. 112.363(8)
28 that would otherwise be assigned to the Retiree Health
29 Insurance Subsidy Trust Fund, less an amount approved by the
30 Legislature which shall be deducted by the division to provide
31 for the administration of this program. The payment of the
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1 contributions to the optional program which is required by
2 this subparagraph for each participant shall be made by the
3 employer to the division which shall forward the contributions
4 to the designated company or companies contracting for payment
5 of benefits for the participant under the program.
6 2. Each employer shall contribute on behalf of each
7 participant in the Senior Management Service Optional Annuity
8 Program an amount equal to the unfunded actuarial accrued
9 liability portion of the employer contribution which would be
10 required for members of the Senior Management and Exempt
11 Service Class in the Florida Retirement System. This
12 contribution shall be paid to the division for transfer to the
13 Florida Retirement System Trust Fund.
14 3. An Optional Annuity Program Trust Fund shall be
15 established in the State Treasury and administered by the
16 division to make payments to provider companies on behalf of
17 the optional annuity program participants, and to transfer the
18 unfunded liability portion of the state optional annuity
19 program contributions to the Florida Retirement System Trust
20 Fund.
21 4. Contributions required for social security by each
22 employer and each participant, in the amount required for
23 social security coverage as now or hereafter may be provided
24 by the federal Social Security Act shall be maintained for
25 each participant in the Senior Management and Exempt Service
26 retirement program and shall be in addition to the retirement
27 contributions specified in this paragraph.
28 5. Each participant in the Senior Management Service
29 Optional Annuity Program may contribute by way of salary
30 reduction or deduction a percentage amount of the
31 participant's gross compensation not to exceed the percentage
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1 amount contributed by the employer to the optional annuity
2 program. Payment of the participant's contributions shall be
3 made by the employer to the division which shall forward the
4 contributions to the designated company or companies
5 contracting for payment of benefits for the participant under
6 the program.
7 (e) Benefits.--
8 1. Benefits shall be payable under the Senior
9 Management Service Optional Annuity Program only to
10 participants in the program, or their beneficiaries as
11 designated by the participant in the contract with a provider
12 company, and such benefits shall be paid by the designated
13 company in accordance with the terms of the annuity contract
14 or contracts applicable to the participant. A participant must
15 be terminated from all employment with all Florida Retirement
16 System employers as provided in s. 121.021(39) to begin
17 receiving the employer-funded benefit. Benefits funded by
18 employer contributions shall be payable only as a lifetime
19 annuity to the participant, his beneficiary, or his estate,
20 except for:
21 a. A lump-sum payment to the beneficiary upon the
22 death of the participant; or
23 b. A cash-out of a de minimis account upon the request
24 of a former participant who has been terminated for a minimum
25 of 6 months from the employment that entitled him to optional
26 retirement program participation. A de minimis account is an
27 account with a provider company containing employer
28 contributions and accumulated earnings of not more than $3,500
29 made under the provisions of this chapter. Such cash-out must
30 be a complete liquidation of the account balance with that
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1 company and is subject to the provisions of the Internal
2 Revenue Code.
3 2. The benefits payable to any person under the Senior
4 Management Service Optional Annuity Program, and any
5 contribution accumulated under such program, shall not be
6 subject to assignment, execution, or attachment or to any
7 legal process whatsoever.
8 3. A participant who receives optional annuity program
9 benefits funded by employer contributions shall be deemed to
10 be retired from a state-administered retirement system in the
11 event of subsequent employment with any employer that
12 participates in the Florida Retirement System.
13 (f) Administration.--
14 1. The Senior Management Service Optional Annuity
15 Program authorized by this section shall be administered by
16 the Division of Retirement. The division shall designate one
17 or more provider companies from which annuity contracts may be
18 purchased under the program and shall approve the form and
19 content of the contracts. The division shall sign a contract
20 with each of the provider companies and shall evaluate the
21 performance of the provider companies on a continuing basis.
22 The division may terminate the services of a provider company
23 for reasons stated in the contract. The division shall adopt
24 rules establishing its responsibilities and the
25 responsibilities of employers in administering the optional
26 annuity program.
27 2. Effective July 1, 1997, the State Board of
28 Administration shall review and make recommendations to the
29 division on the acceptability of all investment products
30 proposed by provider companies of the optional annuity program
31 before such products are offered through annuity contracts to
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1 the participants and may advise the division of any changes
2 deemed necessary to ensure that the optional annuity program
3 offers an acceptable mix of investment products. The division
4 shall make the final determination as to whether an investment
5 product will be approved for the program.
6 3. The provisions of each contract applicable to a
7 participant in the Senior Management Service Optional Annuity
8 Program shall be contained in a written program description
9 which shall include a report of pertinent financial and
10 actuarial information on the solvency and actuarial soundness
11 of the program and the benefits applicable to the participant.
12 Such description shall be furnished by the company or
13 companies to each participant in the program and to the
14 division upon commencement of participation in the program and
15 annually thereafter.
16 4. The division shall ensure that each participant in
17 the Senior Management Service Optional Annuity Program is
18 provided an accounting of the total contribution and the
19 annual contribution made by and on behalf of such
20 participants.
21 (g) Dual employment.--A participant in the optional
22 annuity program may not participate in more than one
23 state-administered retirement system, plan, or class
24 simultaneously. The following shall apply to a participant who
25 is or becomes dually employed:
26 1. A participant who is or becomes dually employed in
27 two or more positions covered by the Florida Retirement
28 System, one of which is eligible for the optional annuity
29 program and one of which is not, shall make one of the
30 following choices:
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1 a. Remain a member of the optional annuity program, in
2 which case contributions shall be paid as required only on the
3 salary earned in the position eligible for the optional
4 annuity program during the period of dual employment;
5 b. Elect, within 90 days after becoming dually
6 employed, membership in the Regular Class of the Florida
7 Retirement System in lieu of the optional annuity program, in
8 which case contributions shall be paid as required on the
9 total salary received for all employment, and, at retirement,
10 the member's average final compensation used to calculate any
11 benefits for which he or she becomes eligible under the
12 Florida Retirement System shall be based on all salary
13 reported for all covered positions during the period of dual
14 employment; or
15 c. If dually employed in an elected office eligible
16 for the Elected State and County Officers' Class, select,
17 within 6 months after assuming office, membership in the
18 Elected State and County Officers' Class, in which case,
19 participation in the optional annuity program shall cease for
20 the period of dual employment, retirement contributions shall
21 be paid as required only on the salary earned as an elected
22 officer, and, at retirement, the member's benefit under the
23 Florida Retirement System shall be based only on the salary
24 received as an elected officer for the period of dual
25 employment.
26 2. When such member ceases to be dually employed, he
27 or she shall make one of the following choices:
28 a. If the position in which he or she remains is a
29 position that is eligible for the optional annuity program, he
30 or she may, within 90 days after ceasing dual employment,
31 elect to remain in the Florida Retirement System class for
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1 which he or she is eligible or to again become a participant
2 in the optional annuity program. Failure to elect membership
3 in the optional annuity program within 90 days shall result in
4 compulsory membership in the Florida Retirement System; or
5 b. If the position in which he or she remains is not a
6 position that is eligible for the optional annuity program, he
7 or she shall participate in the Florida Retirement System
8 class for which he or she is eligible.
9 Section 2. Subsection (12) and paragraph (c) of
10 subsection (29) of section 121.021, Florida Statutes, 1998
11 Supplement, are amended to read:
12 121.021 Definitions.--The following words and phrases
13 as used in this chapter have the respective meanings set forth
14 unless a different meaning is plainly required by the context:
15 (12) "Member" means any officer or employee who is
16 covered or who becomes covered under this system in accordance
17 with this chapter. On and after December 1, 1970, all new
18 members and those members transferring from existing systems
19 shall be divided into the following classes: "Special Risk
20 Class," as provided in s. 121.0515(2); "Special Risk
21 Administrative Support Class," as provided in s. 121.0515(7);
22 "Elected State and County Officers' Class," as provided in s.
23 121.052; "Senior Management and Exempt Service Class," as
24 provided in s. 121.055; and "Regular Class," which consists of
25 all members who are not in the Special Risk Class, Special
26 Risk Administrative Support Class, Elected State and County
27 Officers' Class, or Senior Management and Exempt Service
28 Class.
29 (29) "Normal retirement date" means the first day of
30 any month following the date a member attains one of the
31 following statuses:
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1 (c) If a Senior Management and Exempt Service Class
2 member, the member:
3 1. Completes 7 years of creditable service in the
4 Senior Management and Exempt Service Class and attains age 62;
5 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 as long as such credit is not claimed
9 under any other system.
10 Section 3. Paragraph (c) of subsection (2) and
11 subsection (9) of section 121.051, Florida Statutes, 1998
12 Supplement, are amended to read:
13 121.051 Participation in the system.--
14 (2) OPTIONAL PARTICIPATION.--
15 (c) Employees of members of the State Community
16 College System or charter technical career centers sponsored
17 by members of the State Community College System, as
18 designated in s. 240.3031, who are members of the Regular
19 Class of the Florida Retirement System and who comply with the
20 criteria set forth in this paragraph and in s. 240.3195 may
21 elect, in lieu of participating in the Florida Retirement
22 System, to withdraw from the Florida Retirement System
23 altogether and participate in a lifetime monthly annuity
24 program, to be known as the State Community College System
25 Optional Retirement Program, which may be provided by the
26 employing agency under s. 240.3195. Pursuant thereto:
27 1. The cost to the employer for such annuity shall
28 equal the normal cost portion of the employer retirement
29 contribution which would be required if the employee were a
30 member of the Regular Class, plus the portion of the
31 contribution rate required by s. 112.363(8) that would
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1 otherwise be assigned to the Retiree Health Insurance Subsidy
2 Trust Fund, and less an amount approved by the employer to
3 provide for the administration of the optional retirement
4 program. The employer providing such annuity shall contribute
5 an additional amount to the Florida Retirement System Trust
6 Fund equal to the unfunded actuarial accrued liability portion
7 of the Regular Class contribution rate.
8 2. The decision to participate in such an optional
9 retirement program shall be irrevocable for as long as the
10 employee holds a position eligible for participation. Any
11 service creditable under the Florida Retirement System shall
12 be retained after the member withdraws from the Florida
13 Retirement System; however, additional service credit in the
14 Florida Retirement System shall not be earned while a member
15 of the optional retirement program.
16 3. Participation in an optional annuity program shall
17 be limited to those employees who satisfy the following
18 eligibility criteria:
19 a. The employee must be otherwise eligible for
20 membership in the Regular Class of the Florida Retirement
21 System, as provided in s. 121.021(11) and (12).
22 b. The employee must be employed in a full-time
23 position classified in the Accounting Manual for Florida's
24 Public Community Colleges as:
25 (I) Instructional; or
26 (II) Executive Management, Instructional Management,
27 or Institutional Management, if a community college determines
28 that recruiting to fill a vacancy in the position is to be
29 conducted in the national or regional market, and:
30
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1 (A) The duties and responsibilities of the position
2 include either the formulation, interpretation, or
3 implementation of policies; or
4 (B) The duties and responsibilities of the position
5 include the performance of functions that are unique or
6 specialized within higher education and that frequently
7 involve the support of the mission of the community college.
8 c. The employee must be employed in a position not
9 included in the Senior Management and Exempt Service Class of
10 the Florida Retirement System, as described in s. 121.055.
11 4. Participants in the program are subject to the same
12 reemployment limitations, renewed membership provisions, and
13 forfeiture provisions as are applicable to regular members of
14 the Florida Retirement System under ss. 121.091(9), 121.122,
15 and 121.091(5), respectively.
16 5. Eligible community college employees shall be
17 compulsory members of the Florida Retirement System until,
18 pursuant to the procedures set forth in s. 240.3195, the first
19 day of the next full calendar month following the filing of
20 both a written election to withdraw and a completed
21 application for an individual contract or certificate with the
22 program administrator and receipt of such election by the
23 division.
24 (9) DUAL EMPLOYMENT.--A member may not participate in
25 more than one state-administered retirement system, plan, or
26 class of membership simultaneously. Pursuant thereto:
27 (a) With respect to any member who is not eligible to
28 participate in the Elected State and County Officers' Class,
29 but who is simultaneously employed in two or more positions
30 covered by different Florida Retirement System classes:
31
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1 1. The member must participate in the membership class
2 for the position in which he or she is employed the majority
3 of the time: the Regular Class, Senior Management and Exempt
4 Service Class, Special Risk Class, or Special Risk
5 Administrative Support Class; or
6 2. If the employment is split equally between or among
7 positions, the member may choose any single class of
8 membership for which he or she is eligible, whether or not the
9 positions are full-time positions. The member's choice must be
10 made in writing and remains in effect as long as the member is
11 employed equally in two or more positions.
12 (b) Contributions shall be made and creditable service
13 shall be determined as follows:
14 1. If the member is participating in the Regular
15 Class, retirement contributions shall be made on the total
16 salary the member has received for all covered employment, and
17 at retirement the member's average final compensation shall be
18 calculated on the total salary received from all covered
19 employment.
20 2. If the member is participating in the Senior
21 Management and Exempt Service Class, Special Risk Class, or
22 Special Risk Administrative Support Class, retirement
23 contributions shall be made only on the salary received in the
24 designated class of membership. At retirement, the member's
25 average final compensation shall be based only on the salary
26 received in the designated class of membership for any period,
27 including any period of dual employment.
28 Section 4. Paragraph (c) of subsection (3) of section
29 121.052, Florida Statutes, 1998 Supplement, is amended to
30 read:
31 121.052 Membership class of elected officers.--
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1 (3) PARTICIPATION AND WITHDRAWAL,
2 GENERALLY.--Effective July 1, 1990, participation in the
3 Elected State and County Officers' Class shall be compulsory
4 for elected officers listed in paragraphs (2)(a)-(d) and (f)
5 assuming office on or after said date, unless the elected
6 officer elects membership in another class or withdraws from
7 the Florida Retirement System as provided in paragraphs
8 (3)(a)-(d):
9 (c) Any elected officer may, within 6 months after
10 assuming office, or within 6 months after this act becomes a
11 law for serving elected officers, elect membership in the
12 Senior Management and Exempt Service Class as provided in s.
13 121.055 in lieu of membership in the Elected State and County
14 Officers' Class. Any such election made by a county elected
15 officer shall have no effect upon the statutory limit on the
16 number of nonelective full-time positions that may be
17 designated by a local agency employer for inclusion in the
18 Senior Management and Exempt Service Class under s.
19 121.055(1)(b)1.
20 Section 5. Subsections (1) and (2) and paragraph (a)
21 of subsection (3) of section 121.091, Florida Statutes, 1998
22 Supplement, are amended to read:
23 121.091 Benefits payable under the system.--Benefits
24 may not be paid under this section unless the member has
25 terminated employment as provided in s. 121.021(39)(a) or
26 begun participation in the Deferred Retirement Option Program
27 as provided in subsection (13), and a proper application has
28 been filed in the manner prescribed by the division. The
29 division may cancel an application for retirement benefits
30 when the member or beneficiary fails to timely provide the
31 information and documents required by this chapter and the
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1 division's rules. The division shall adopt rules establishing
2 procedures for application for retirement benefits and for the
3 cancellation of such application when the required information
4 or documents are not received.
5 (1) NORMAL RETIREMENT BENEFIT.--Upon attaining his or
6 her normal retirement date, the member, upon application to
7 the administrator, shall receive a monthly benefit which shall
8 begin to accrue on the first day of the month of retirement
9 and be payable on the last day of that month and each month
10 thereafter during his or her lifetime. The normal retirement
11 benefit, including any past or additional retirement credit,
12 may not exceed 100 percent of the average final compensation.
13 The amount of monthly benefit shall be calculated as the
14 product of A and B, subject to the adjustment of C, if
15 applicable, as set forth below:
16 (a)1. For creditable years of Regular Class service, A
17 is 1.60 percent of the member's average final compensation, up
18 to the member's normal retirement date. Upon completion of the
19 first year after the normal retirement date, A is 1.63 percent
20 of the member's average final compensation. Following the
21 second year after the normal retirement date, A is 1.65
22 percent of the member's average final compensation. Following
23 the third year after the normal retirement date, and for
24 subsequent years, A is 1.68 percent of the member's average
25 final compensation.
26 2. For creditable years of special risk service, A is:
27 a. Two percent of the member's average final
28 compensation for all creditable years prior to October 1,
29 1974;
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31
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1 b. Three percent of the member's average final
2 compensation for all creditable years after September 30,
3 1974, and before October 1, 1978;
4 c. Two percent of the member's average final
5 compensation for all creditable years after September 30,
6 1978, and before January 1, 1989;
7 d. Two and two-tenths percent of the member's final
8 monthly compensation for all creditable years after December
9 31, 1988, and before January 1, 1990;
10 e. Two and four-tenths percent of the member's average
11 final compensation for all creditable years after December 31,
12 1989, and before January 1, 1991;
13 f. Two and six-tenths percent of the member's average
14 final compensation for all creditable years after December 31,
15 1990, and before January 1, 1992;
16 g. Two and eight-tenths percent of the member's
17 average final compensation for all creditable years after
18 December 31, 1991, and before January 1, 1993; and
19 h. Three percent of the member's average final
20 compensation for all creditable years after December 31, 1992;
21 3. For creditable years of Senior Management and
22 Exempt Service Class service after January 31, 1987, A is 2
23 percent;
24 4. For creditable years of Elected State and County
25 Officers' Class service as a Supreme Court Justice, district
26 court of appeal judge, circuit judge, or county court judge, A
27 is 3 1/3 percent of the member's average final compensation,
28 and for all other creditable service in such class, A is 3
29 percent of average final compensation.;
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1 (b) B is the number of the member's years and any
2 fractional part of a year of creditable service earned
3 subsequent to November 30, 1970.; and
4 (c) C is the normal retirement benefit credit brought
5 forward as of November 30, 1970, by a former member of an
6 existing system. Such normal retirement benefit credit shall
7 be determined as the product of X and Y when X is the
8 percentage of average final compensation which the member
9 would have been eligible to receive if the member had attained
10 his or her normal retirement date as of November 30, 1970, all
11 in accordance with the existing system under which the member
12 is covered on November 30, 1970, and Y is average final
13 compensation as defined in s. 121.021(25). However, any
14 member of an existing retirement system who is eligible to
15 retire and who does retire, become disabled, or die prior to
16 April 15, 1971, may have his or her retirement benefits
17 calculated on the basis of the best 5 of the last 10 years of
18 service.
19 (d) A member's average final compensation shall be
20 determined by formula to obtain the coverage for the 5 highest
21 fiscal years' salaries, calculated as provided by rule.
22 (2) BENEFITS PAYABLE FOR DUAL NORMAL RETIREMENT
23 AGES.--If a member accumulates retirement benefits to commence
24 at different normal retirement ages by virtue of having
25 performed duties for an employer which would entitle him or
26 her to benefits as both a member of the Special Risk Class and
27 a member of either the Regular Class, Senior Management and
28 Exempt Service Class, or Elected State and County Officers'
29 Class, the amount of benefits payable shall be computed
30 separately with respect to each such age and the sum of such
31 computed amounts shall be paid as provided in this section.
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1 (3) EARLY RETIREMENT BENEFIT.--Upon retirement on his
2 or her early retirement date, the member shall receive an
3 immediate monthly benefit that shall begin to accrue on the
4 first day of the month of the retirement date and be payable
5 on the last day of that month and each month thereafter during
6 his or her lifetime. Such benefit shall be calculated as
7 follows:
8 (a) The amount of each monthly payment shall be
9 computed in the same manner as for a normal retirement
10 benefit, in accordance with subsection (1), but shall be based
11 on the member's average monthly compensation and creditable
12 service as of the member's early retirement date. The benefit
13 so computed shall be reduced by five-twelfths of 1 percent for
14 each complete month by which the early retirement date
15 precedes the normal retirement date of age 62 for a member of
16 the Regular Class, Senior Management and Exempt Service Class,
17 or the Elected State and County Officers' Class, and age 55
18 for a member of the Special Risk Class, or age 52 if a Special
19 Risk member has completed 25 years of creditable service in
20 accordance with s. 121.021(29)(b)3.
21 Section 6. Section 121.122, Florida Statutes, 1998
22 Supplement, is amended to read:
23 121.122 Renewed membership in system.--Except as
24 provided in s. 121.053, effective July 1, 1991, any retiree of
25 a state-administered retirement system who is employed in a
26 regularly established position with a covered employer shall
27 be enrolled as a compulsory member of the Regular Class of the
28 Florida Retirement System or, effective July 1, 1997, any
29 retiree of a state-administered retirement system who is
30 employed in a position included in the Senior Management and
31 Exempt Service Class shall be enrolled as a compulsory member
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1 of the Senior Management and Exempt Service Class of the
2 Florida Retirement System as provided in s. 121.055, and shall
3 be entitled to receive an additional retirement benefit,
4 subject to the following conditions:
5 (1)(a) Such member shall resatisfy the age and service
6 requirements as provided in this chapter for initial
7 membership under the system, unless such member elects to
8 participate in the Senior Management Service Optional Annuity
9 Program in lieu of the Senior Management and Exempt Service
10 Class, as provided in s. 121.055(6).
11 (b) Such member shall not be entitled to disability
12 benefits as provided in s. 121.091(4).
13 (c) Such member must meet the reemployment after
14 retirement limitations as provided in s. 121.091(9), as
15 applicable.
16 (2) Upon renewed membership, the employer of such
17 member shall pay the applicable employer contributions as
18 required by ss. 121.055(3) and 121.071(1)(a) and (4).
19 (3) Such member shall be entitled to purchase
20 additional retirement credit in the Regular Class or the
21 Senior Management and Exempt Service Class, as applicable, for
22 any postretirement service performed in a regularly
23 established position as follows:
24 (a) For regular class service prior to July 1, 1991,
25 by paying the Regular Class applicable employee and employer
26 contributions for the period being claimed, plus 4 percent
27 interest compounded annually from first year of service
28 claimed until July 1, 1975, and 6.5 percent interest
29 compounded thereafter, until full payment is made to the
30 Florida Retirement System Trust Fund; or
31
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1 (b) For Senior Management Service Class prior to June
2 1, 1997, as provided in s. 121.055(1)(h).
3
4 The contribution for postretirement service between July 1,
5 1985, and July 1, 1991, for which the reemployed retiree
6 contribution was paid, shall be the difference between such
7 contribution and the total applicable contribution for the
8 period being claimed, plus interest. The employer of such
9 member may pay the applicable employer contribution in lieu of
10 the member. If a member does not wish to claim credit for all
11 of the postretirement service for which he or she is eligible,
12 the service the member claims must be the most recent service.
13 (4) No creditable service for which credit was
14 received, or which remained unclaimed, at retirement may be
15 claimed or applied toward service credit earned following
16 renewed membership. However, service earned as an elected
17 officer with renewed membership in the Elected State and
18 County Officers' Class may be used in conjunction with
19 creditable service earned under this section, provided the
20 applicable vesting requirements and other existing statutory
21 conditions required by this chapter are met.
22 (5) Notwithstanding any other limitations provided in
23 this section, a participant of the State University System
24 Optional Retirement Program or the Senior Management Service
25 Optional Annuity Program who terminated employment and
26 commenced receiving an annuity under the provisions of the
27 optional program, who renews membership in the Regular Class
28 as required by this section upon reemployment after
29 retirement, and who had previously earned creditable Florida
30 Retirement System service that was not included in any
31 retirement benefit may include such previous service toward
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1 vesting and service credit in the second career benefit
2 provided under renewed membership.
3 (6) Any renewed member who is not receiving the
4 maximum health insurance subsidy provided in s. 112.363 shall
5 be entitled to earn additional credit toward the maximum
6 health insurance subsidy. Any additional subsidy due because
7 of such additional credit shall be received only at the time
8 of payment of the second career retirement benefit. In no
9 case shall the total health insurance subsidy received by a
10 retiree receiving benefits from initial and renewed membership
11 exceed the maximum allowed in s. 112.363.
12 Section 7. This act shall take effect July 1, 2000.
13
14 *****************************************
15 SENATE SUMMARY
16 Renames the Senior Management Service Class as the Senior
Management and Exempt Service Class. Provides for state
17 employees in the Selected Exempt Service System and other
employees who are exempt from the Career Service System
18 to participate in the Senior Management and Exempt
Service Class. Authorizes such members to elect to
19 participate in the Senior Management Service Optional
Annuity Program.
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