House Bill 2393

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    Florida House of Representatives - 2000                HB 2393

        By the Committee on General Appropriations and
    Representatives Pruitt and Sanderson





  1                      A bill to be entitled

  2         An act relating to retirement; amending s.

  3         112.65, F.S.; providing that certain benefits

  4         under chapter 121, F.S., shall be considered

  5         supplemental benefits; amending s. 121.021,

  6         F.S.; redefining the term "system" with respect

  7         to the Florida Retirement System; designating

  8         ss. 121.011-121.45, F.S., as part I of chapter

  9         121, F.S.; designating ss. 121.4501-121.571,

10         F.S., as part II of chapter 121, F.S.; creating

11         s. 121.4501, F.S.; directing the State Board of

12         Administration to establish an optional defined

13         contribution retirement program for members of

14         the Florida Retirement System; providing

15         definitions; providing for eligibility and

16         retirement service credit; providing for

17         participation and enrollment; providing for

18         contributions; providing vesting requirements;

19         providing benefits; providing for

20         administration; providing for investment

21         options or products; providing for an education

22         component; providing participant information

23         requirements; providing that advisory

24         committees shall provide advice and assistance;

25         providing for federal requirements; providing

26         an investment policy statement; providing a

27         statement of fiduciary standards and

28         responsibilities; providing for disability

29         benefits; providing for social security and

30         health insurance subsidy coverage; creating s.

31         121.571, F.S.; providing for contributions;

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  1         amending ss. 121.021, 121.051, 121.0515,

  2         121.052, 121.053, 121.081, 121.1115, 121.1122,

  3         121.121, and 215.32, F.S.; providing that

  4         members employed in a regularly established

  5         position shall be vested after 8 years of

  6         creditable service; conforming to the act;

  7         amending ss. 112.19, 112.191, 112.313, 112.665,

  8         154.10, 154.12, 175.361, 185.37, 189.412,

  9         216.262, 231.36, 238.072, 238.171, 238.175,

10         240.3195, and 650.05, F.S.; correcting cross

11         references to conform to the act; amending s.

12         112.363, F.S.; revising language with respect

13         to the retiree health insurance subsidy to

14         include reference to the optional retirement

15         program; amending s. 121.055, F.S.; increasing

16         the number of personnel that may be designated

17         as Senior Management Service Class by local

18         governments; allowing senior management

19         optional annuity program benefits to be

20         distributed through a direct rollover;

21         providing for funding; providing contribution

22         rates; providing a statement of state purpose;

23         providing future effect for certain provisions;

24         providing a contingent effective date.

25

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

27

28         Section 1.  Subsection (1) of section 112.65, Florida

29  Statutes, is amended to read:

30         112.65  Limitation of benefits.--

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  1         (1)  The normal retirement benefit or pension payable

  2  to a retiree who becomes a member of any retirement system or

  3  plan and who has not previously participated in such plan, on

  4  or after January 1, 1980, shall not exceed 100 percent of his

  5  or her average final compensation.  However, nothing contained

  6  in this section shall apply to supplemental retirement

  7  benefits or to pension increases attributable to

  8  cost-of-living increases or adjustments. For the purposes of

  9  this section, benefits accruing on individual participant

10  accounts established under the Public Employee Optional

11  Retirement Program established in part II of chapter 121 are

12  considered supplemental benefits. As used in this section, the

13  term "average final compensation" means the average of the

14  member's earnings over a period of time which the governmental

15  entity has established by statute, charter, or ordinance.

16         Section 2.  Subsection (3) of section 121.021, Florida

17  Statutes, is amended to read:

18         121.021  Definitions.--The following words and phrases

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

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

21         (3)  "System" means the general retirement system

22  established by this chapter to be known and cited as the

23  "Florida Retirement System," including, but not limited to,

24  the defined benefit retirement program administered under the

25  provisions of part I of this chapter and the defined

26  contribution retirement program known as the Public Employee

27  Optional Retirement Program and administered under the

28  provisions of part II of this chapter."

29         Section 3.  Chapter 121, Florida Statutes, is

30  designated as part I of said chapter, and part II, consisting

31  of sections 121.4501 through 121.571, is created to read:

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  1         121.4501  Public Employee Optional Retirement

  2  Program.--

  3         (1)  The Trustees of the State Board of Administration

  4  shall establish an optional defined contribution retirement

  5  program for members of the Florida Retirement System under

  6  which retirement benefits will be provided for eligible

  7  employees who elect to participate in the program. The

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

  9  such optional retirement program shall be provided through

10  employee-directed investments, in accordance with s. 401(a) of

11  the Internal Revenue Code and its related regulations. The

12  employers shall contribute, as provided in this section and s.

13  121.571, toward the funding of such optional benefits.

14         (2)  DEFINITIONS.--As used in this section, the term:

15         (a)  "Approved provider" or "provider" means a private

16  sector company that is selected and approved by the state

17  board to offer one or more investment products or services to

18  the Public Employee Optional Retirement Program. Private

19  sector companies include investment management companies,

20  insurance companies, depositories, and mutual fund companies.

21         (b)  "De minimis account" refers to an account

22  containing total vested account contributions and accumulated

23  earnings under the Public Employee Optional Retirement Program

24  of not more than $5,000.

25         (c)  "Department" means the Department of Management

26  Services.

27         (d)  "Division" means the Division of Retirement within

28  the Department of Management Services.

29         (e)  "Eligible employee" means an officer or employee,

30  as defined in s. 121.021(11), who:

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  1         1.  Is a member of, or is eligible for membership in,

  2  the Florida Retirement System;

  3         2.  Participates in, or is eligible to participate in,

  4  the Senior Management Service Optional Annuity Program as

  5  established under s. 121.055(6); or

  6         3.  Is eligible to participate in, but does not

  7  participate in, the State University System Optional

  8  Retirement Program established under s. 121.35 or the State

  9  Community College System Optional Retirement Program

10  established under s. 121.051(2)(c).

11

12  The term does not include any renewed member of the Florida

13  Retirement System, any member participating in the Deferred

14  Retirement Option Program established under s. 121.091(13), or

15  any employee participating in an optional retirement program

16  established under s. 121.35 or s. 121.051(2)(c).

17         (f)  "Employer" means an employer, as defined in s.

18  121.021(10), of an eligible employee.

19         (g)  "Participant" means an eligible employee who

20  elects to participate in the Public Employee Optional

21  Retirement Program and enrolls in such optional program as

22  provided in subsection (4).

23         (h)  "Public Employee Optional Retirement Program,"

24  "optional program" or "optional retirement program" means the

25  alternative defined contribution retirement program

26  established under this section.

27         (i)  "State board" or "board" means the State Board of

28  Administration.

29         (j)  "Trustees" means Trustees of the State Board of

30  Administration.

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  1         (k)  "Vested" or "vesting" means the guarantee that a

  2  participant is eligible to receive a full retirement benefit

  3  upon completion of the required years of service under the

  4  Public Employee Optional Retirement Program.

  5         (3)  ELIGIBILITY; RETIREMENT SERVICE CREDIT.--

  6         (a)  Participation in the Public Employee Optional

  7  Retirement Program is limited to eligible employees.

  8  Participation in the optional retirement program is in lieu of

  9  participation in the defined benefit program of the Florida

10  Retirement System.

11         (b)  An eligible employee who is a member of the

12  defined benefit retirement program of the Florida Retirement

13  System at the time of his or her election to participate in

14  the Public Employee Optional Retirement Program shall retain

15  all retirement service credit earned under the defined benefit

16  retirement program of the Florida Retirement System as

17  credited under the system and shall be entitled to a deferred

18  benefit upon termination, if eligible under the system.

19  However, election to participate in the Public Employee

20  Optional Retirement Program terminates the active membership

21  of the employee in the defined benefit program of the Florida

22  Retirement System, and the service of a participant in the

23  Public Employee Optional Retirement Program shall not be

24  creditable under the defined benefit retirement program of the

25  Florida Retirement System for purposes of benefit accrual but

26  shall be credited for purposes of vesting.

27         (c)1.  Notwithstanding paragraph (b), each eligible

28  employee who elects to participate in the Public Employee

29  Optional Retirement Program and establishes one or more

30  individual participant accounts under the optional program may

31  elect to transfer to the optional program a sum representing

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  1  the present value of the employee's accumulated benefit

  2  obligation under the defined benefit retirement program of the

  3  Florida Retirement System. Upon such transfer, all service

  4  credit previously earned under the defined benefit program of

  5  the Florida Retirement System shall be nullified for purposes

  6  of entitlement to a future benefit under the defined benefit

  7  program of the Florida Retirement System. A participant is

  8  precluded from transferring the accumulated benefit obligation

  9  balance from the defined benefit program upon the expiration

10  of the period afforded to enroll in the optional program.

11         2.  For purposes of this subsection, the present value

12  of the member's accumulated benefit obligation is based upon

13  the member's estimated creditable service and estimated

14  average final compensation as of midnight of the day prior to

15  the opening of the election window for the employee. The

16  actuarial present value of the employee's accumulated benefit

17  obligation shall be based on the following:

18         a.  The discount rate and other relevant actuarial

19  assumptions used to value the Florida Retirement System Trust

20  Fund at the time the amount to be transferred is determined,

21  consistent with the factors provided in sub-subparagraphs b.

22  and c.

23         b.  A benefit commencement age, based on the member's

24  estimated creditable service as of midnight on May 31, 2002.

25  The benefit commencement age shall be the younger of the

26  following, but shall not be younger than the member's age as

27  of midnight on May 31, 2002:

28         (I)  Age 62; or

29         (II)  The age the member would attain if the member

30  completed 30 years of service with an employer, assuming the

31  member worked continuously from May 31, 2002, and disregarding

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  1  any vesting requirement that would otherwise apply under the

  2  defined benefit program of the Florida Retirement System.

  3         c.  For members of the Special Risk Class and for

  4  members of the Special Risk Administrative Support Class

  5  entitled to retain special risk normal retirement date, the

  6  benefit commencement age shall be the younger of the

  7  following, but shall not be younger than the member's age as

  8  of midnight on May 31, 2002:

  9         (I)  Age 55; or

10         (II)  The age the member would attain if the member

11  completed 25 years of service with an employer, assuming the

12  member worked continuously from May 31, 2002, and disregarding

13  any vesting requirement that would otherwise apply under the

14  defined benefit program of the Florida Retirement System.

15         d.  The calculation shall disregard vesting

16  requirements and early retirement reduction factors that would

17  otherwise apply under the defined benefit retirement program.

18         3.  For each participant who elects to transfer moneys

19  from the defined benefit program to his or her account in the

20  optional program, the division shall recompute the amount

21  transferred under subparagraph 2. not later than 60 days after

22  the actual transfer of funds based upon the participant's

23  actual creditable service and actual final average

24  compensation as of the initial date of participation in the

25  optional program. If the recomputed amount differs from the

26  amount transferred under subparagraph 2. by $10 or more, the

27  division shall:

28         a.  Transfer, or cause to be transferred, from the

29  Florida Retirement System Trust Fund to the participant's

30  account in the optional program the excess, if any, of the

31  recomputed amount over the previously transferred amount

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  1  together with interest from the initial date of transfer to

  2  the date of transfer under this subparagraph, based upon 8

  3  percent effective annual interest, compounded annually.

  4         b.  Transfer, or cause to be transferred, from the

  5  participant's account to the Florida Retirement System Trust

  6  Fund the excess, if any, of the previously transferred amount

  7  over the recomputed amount, together with interest from the

  8  initial date of transfer to the date of transfer under this

  9  subparagraph, based upon 6 percent effective annual interest,

10  compounded annually, pro rata based on the participant's

11  allocation plan.

12         4.  As directed by the participant, the board shall

13  transfer or cause to be transferred the appropriate amounts to

14  the designated accounts. At least 10 percent of the amount

15  transferred shall be transferred to a stable value product.

16  The board shall establish transfer procedures by rule, but the

17  actual transfer shall not be later than 30 days after the

18  effective date of the member's participation in the optional

19  program. Transfers are not commissionable or subject to other

20  fees and may be in the form of securities or cash as

21  determined by the state board.

22         5.  If the board or the division receives notification

23  from the United States Internal Revenue Service that this

24  paragraph or any portion of this paragraph will cause the

25  retirement system, or a portion thereof, to be disqualified

26  for tax purposes under the Internal Revenue Code, then the

27  portion that will cause the disqualification does not apply.

28  Upon such notice, the state board and the division shall

29  notify the presiding officers of the Legislature.

30         (4)  PARTICIPATION; ENROLLMENT.--

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  1         (a)1.  With respect to an eligible employee who is

  2  employed in a regularly established position on June 1, 2002,

  3  by a state employer:

  4         a.  Any such employee may elect to participate in the

  5  Public Employee Optional Retirement Program in lieu of

  6  retaining his or her membership in the defined benefit program

  7  of the Florida Retirement System. The election must be made in

  8  writing or by electronic means and must be filed with the

  9  department and the personnel officer of the employer within 90

10  days after June 1, 2002, or, in the case of an active employee

11  who is on a leave of absence on June 1, 2002, within 90 days

12  after the conclusion of the leave of absence. This election is

13  irrevocable, except as provided in paragraph (e). Upon making

14  such election, the employee shall be enrolled as a participant

15  of the Public Employee Optional Retirement Program, the

16  employee's membership in the Florida Retirement System sha l

17  be governed by the provisions of this part and the employee's

18  membership in the defined benefit program of the Florida

19  Retirement System shall terminate. The employee's enrollment

20  in the Public Employee Optional Retirement Program shall be

21  effective the first day of the month for which a full month's

22  employer contribution is made to the optional program.

23         b.  Any such employee who fails to elect to participate

24  in the Public Employee Optional Retirement Program within the

25  prescribed 90 days is deemed to have elected to retain

26  membership in the defined benefit program of the Florida

27  Retirement System and the employee's option to elect to

28  participate in the optional program is forfeited.

29         2.  With respect to employees who become eligible to

30  participate in the Public Employee Optional Retirement Program

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  1  by reason of employment in a regularly established position

  2  commencing after June 1, 2002:

  3         a.  Any such employee shall, by default, be enrolled in

  4  the defined benefit retirement program of the Florida

  5  Retirement System at the commencement of employment, and may,

  6  within 180 days after employment commences, elect to

  7  participate in the Public Employee Optional Retirement

  8  Program. The employee's election must be made in writing or by

  9  electronic means and must be filed with the personnel officer

10  of the employer. The election to participate in the optional

11  program is irrevocable, except as provided in paragraph (e).

12         b.  If the employee files such election before the

13  initial payroll is submitted for the employee, enrollment in

14  the Public Employee Optional Retirement Program shall be

15  effective on the first day of employment.

16         c.  If the employee files such election within 180 days

17  after employment commences, but after the initial payroll is

18  submitted for the employee, enrollment in the optional program

19  shall be effective on the first day of the month for which a

20  full month's employer contribution is made to the optional

21  program.

22         d.  Any such employee who fails to elect to participate

23  in the Public Employee Optional Retirement Program within the

24  prescribed 180 days is deemed to have elected to retain

25  membership in the defined benefit program of the Florida

26  Retirement System and the employee's option to elect to

27  participate in the optional program is forfeited.

28         3.  For purposes of this paragraph, "state employer"

29  means any agency, board, branch, commission, community

30  college, department, institution, institution of higher

31  education, or water management district of the state, which

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  1  participates in the Florida Retirement System for the benefit

  2  of certain employees.

  3         (b)1.  With respect to an eligible employee who is

  4  employed in a regularly established position on September 1,

  5  2002, by a district school board employer:

  6         a.  Any such employee may elect to participate in the

  7  Public Employee Optional Retirement Program in lieu of

  8  retaining his or her membership in the defined benefit program

  9  of the Florida Retirement System. The election must be made in

10  writing or by electronic means and must be filed with the

11  department and the personnel officer of the employer within 90

12  days after September 1, 2002, or, in the case of an active

13  employee who is on a leave of absence on September 1, 2002,

14  within 90 days after the conclusion of the leave of absence.

15  This election is irrevocable, except as provided in paragraph

16  (e). Upon making such election, the employee shall be enrolled

17  as a participant of the Public Employee Optional Retirement

18  Program, the employee's membership in the Florida Retirement

19  System shall be governed by the provisions of this part and

20  the employee's membership in the defined benefit program of

21  the Florida Retirement System shall terminate. The employee's

22  enrollment in the Public Employee Optional Retirement Program

23  shall be effective the first day of the month for which a full

24  month's employer contribution is made to the optional program.

25         b.  Any such employee who fails to elect to participate

26  in the Public Employee Optional Retirement Program within the

27  prescribed 90 days is deemed to have elected to retain

28  membership in the defined benefit program of the Florida

29  Retirement System and the employee's option to elect to

30  participate in the optional program is forfeited.

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  1         2.  With respect to employees who become eligible to

  2  participate in the Public Employee Optional Retirement Program

  3  by reason of employment in a regularly established position

  4  with a district school board employer commencing after

  5  September 1, 2002:

  6         a.  Any such employee shall, by default, be enrolled in

  7  the defined benefit retirement program of the Florida

  8  Retirement System at the commencement of employment, and may,

  9  within 180 days after employment commences, elect to

10  participate in the Public Employee Optional Retirement

11  Program. The employee's election must be made in writing or by

12  electronic means and must be filed with the personnel officer

13  of the employer. The election to participate in the optional

14  program is irrevocable, except as provided in paragraph (e).

15         b.  If the employee files such election before the

16  initial payroll is submitted for the employee, enrollment in

17  the Public Employee Optional Retirement Program shall be

18  effective on the first day of employment.

19         c.  If the employee files such election within 180 days

20  after employment commences, but after the initial payroll is

21  submitted for the employee, enrollment in the optional program

22  shall be effective on the first day of the month for which a

23  full month's employer contribution is made to the optional

24  program.

25         d.  Any such employee who fails to elect to participate

26  in the Public Employee Optional Retirement Program within the

27  prescribed 180 days is deemed to have elected to retain

28  membership in the defined benefit program of the Florida

29  Retirement System and the employee's option to elect to

30  participate in the optional program is forfeited.

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  1         3.  For purposes of this paragraph, "district school

  2  board employer" means any district school board that

  3  participates in the Florida Retirement System for the benefit

  4  of certain employees, or a charter school or chapter technical

  5  career center that participates in the Florida Retirement

  6  System as provided in s. 121.051(2)(d).

  7         (c)1.  With respect to an eligible employee who is

  8  employed in a regularly established position on December 1,

  9  2002, by a local employer:

10         a.  Any such employee may elect to participate in the

11  Public Employee Optional Retirement Program in lieu of

12  retaining his or her membership in the defined benefit program

13  of the Florida Retirement System. The election must be made in

14  writing or by electronic means and must be filed with the

15  department and the personnel officer of the employer within 90

16  days after December 1, 2002, or, in the case of an active

17  employee who is on a leave of absence on December 1, 2002,

18  within 90 days after the conclusion of the leave of absence.

19  This election is irrevocable. Upon making such election, the

20  employee shall be enrolled as a participant of the Public

21  Employee Optional Retirement Program, the employee's

22  membership in the Florida Retirement System will be governed

23  by the provisions of this part and the employee's membership

24  in the defined benefit program of the Florida Retirement

25  System shall terminate. The employee's enrollment in the

26  Public Employee Optional Retirement Program shall be effective

27  the first day of the month for which a full month's employer

28  contribution is made to the optional program.

29         b.  Any such employee who fails to elect to participate

30  in the Public Employee Optional Retirement Program within the

31  prescribed 90 days is deemed to have elected to retain

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  1  membership in the defined benefit program of the Florida

  2  Retirement System and the employee's option to elect to

  3  participate in the optional program is forfeited.

  4         2.  With respect to employees who become eligible to

  5  participate in the Public Employee Optional Retirement Program

  6  by reason of employment in a regularly established position

  7  with a local employer commencing after December 1, 2002:

  8         a.  Any such employee shall, by default, be enrolled in

  9  the defined benefit retirement program of the Florida

10  Retirement System at the commencement of employment, and may,

11  within 180 days after employment commences, elect to

12  participate in the Public Employee Optional Retirement

13  Program. The employee's election must be made in writing or by

14  electronic means and must be filed with the personnel officer

15  of the employer. The election to participate in the optional

16  program is irrevocable, except as provided in paragraph (e).

17         b.  If the employee files such election before the

18  initial payroll is submitted for the employee, enrollment in

19  the Public Employee Optional Retirement Program shall be

20  effective on the first day of employment.

21         c.  If the employee files such election within 90 days

22  after employment commences, but after the initial payroll is

23  submitted for the employee, enrollment in the optional program

24  shall be effective on the first day of the month for which a

25  full month's employer contribution is made to the optional

26  program.

27         d.  Any such employee who fails to elect to participate

28  in the Public Employee Optional Retirement Program within the

29  prescribed 180 days is deemed to have elected to retain

30  membership in the defined benefit program of the Florida

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  1  Retirement System and the employee's option to elect to

  2  participate in the optional program is forfeited.

  3         3.  For purposes of this paragraph, "local employer"

  4  means any employer not included in paragraph (a) or paragraph

  5  (b).

  6         (d)  Contributions available for self-direction by a

  7  participant who has not selected on or more specific

  8  investment products shall be allocated as prescribed by the

  9  board. The third-party administrator shall notify any such

10  participant at least quarterly that the participant should

11  take an affirmative action to make an asset allocation among

12  the optional program products.

13         (e)  After the period during which an eligible employee

14  had the choice to elect the defined benefit program or the

15  Public Employee Optional Retirement Program, the employee

16  shall have one opportunity, at the employee's discretion, to

17  choose to move from the defined benefit program to the Public

18  Employee Optional Retirement Program or from the Public

19  Employee Optional Retirement Program to the defined benefit

20  program.

21         1.  If the employee chooses to move to the Public

22  Employee Optional Retirement Program, the applicable

23  provisions of this section shall govern the transfer.

24         2.  If the employee chooses to move to the defined

25  benefit program, the employee must transfer from his or her

26  Public Employee Optional Retirement Program account and from

27  other employee moneys as necessary, a sum representing all

28  contributions that would have been made to the defined benefit

29  plan for that employee and the actual return that would have

30  been earned on those contributions had they been invested in

31  the defined benefit program.

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  1         (5)  CONTRIBUTIONS.--

  2         (a)  Each employer shall contribute on behalf of each

  3  participant in the Public Employee Optional Retirement Program

  4  an amount based on a percentage of the employee's monthly

  5  compensation as set forth in s. 121.571. The plan fiduciary

  6  shall ensure that all plan assets are held in a trust,

  7  pursuant to s. 401 of the Internal Revenue Code. The employer

  8  shall forward all contributions under this program to the

  9  third-party administrator. The fiduciary shall ensure that

10  said contributions are allocated as follows:

11         1.  The portion earmarked for participant accounts

12  shall be used to purchase interests in the appropriate

13  investment vehicles for the accounts of each participant as

14  specified by the participant, or in accordance with paragraph

15  (4)(d).

16         2.  The portion earmarked for administrative and

17  educational expenses shall be transferred to the board.

18         3.  The portion earmarked for disability benefits shall

19  be transferred to the department.

20         (b)  Employers are responsible for notifying

21  participants regarding maximum contribution levels permitted

22  under the Internal Revenue Code. If a participant contributes

23  to any other tax-deferred plan, he or she is responsible for

24  ensuring that total contributions made to the optional program

25  and to any other such plan do not exceed federally permitted

26  maximums.

27         (6)  VESTING REQUIREMENTS.--

28         (a)1.  With respect to employer contributions paid on

29  behalf of the participant to the Public Employee Optional

30  Retirement Program, plus interest and earnings thereon and

31  less investment fees and administrative charges, a participant

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  1  shall be vested after completing 1 work year, as defined in s.

  2  121.021(54) with an employer, including any service while the

  3  participant was a member of the defined benefit retirement

  4  program or an optional retirement program authorized under s.

  5  121.051(2)(c) or s. 121.055(6).

  6         2.  If the participant terminates employment prior to

  7  satisfying the vesting requirements, the nonvested

  8  accumulation shall be transferred from the participant's

  9  accounts to the state board for deposit in the suspense

10  account of the Public Employee Optional Retirement Program

11  Trust Fund of the board. If the terminated participant is

12  reemployed as an eligible employee within 5 years, the state

13  board shall transfer to the participant's account any amount

14  of the moneys previously transferred from the participant's

15  accounts to the Public Employee Optional Retirement Program

16  Trust Fund, plus interest calculated at 3.0 percent per annum,

17  calculated from the date of transfer to the date of

18  reemployment.

19         (b)1.  A participant shall be vested in the amount

20  transferred from the defined benefit program, plus interest

21  and earnings thereon and less administrative charges and

22  investment fees, upon meeting the service requirements for the

23  participant's membership class as set forth in s. 121.021(29).

24  The third-party administrator shall account for such amounts

25  for each participant. The division shall notify the

26  participant and the third-party administrator when the

27  participant has satisfied the vesting period for Florida

28  Retirement System purposes.

29         2.  If the participant terminates employment prior to

30  satisfying the vesting requirements, the nonvested

31  accumulation shall be transferred from the participant's

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  1  accounts to the state board for deposit in the suspense

  2  account of the Public Employee Optional Retirement Program

  3  Trust Fund of the board. If the terminated participant is

  4  reemployed as an eligible employee within 5 years, the state

  5  board shall transfer to the participant's account any amount

  6  of the moneys previously transferred from the participant's

  7  accounts to the Public Employee Optional Retirement Program

  8  Trust Fund, plus interest calculated at 6.0 percent per annum,

  9  calculated from the date of transfer to the date of

10  reemployment.

11         (c)  Any nonvested accumulations transferred from a

12  participant's account to the suspense account shall be

13  forfeited by the participant if the participant is not

14  reemployed as an eligible employee within 5 years after

15  termination.

16         (7)  BENEFITS.--Under the Public Employee Optional

17  Retirement Program:

18         (a)  Benefits shall be provided in accordance with s.

19  401(a) of the Internal Revenue Code.

20         (b)  Benefits shall accrue in individual accounts that

21  are participant-directed, portable, and funded by employer

22  contributions and earnings thereon.

23         (c)  Benefits shall be payable in accordance with the

24  following terms and conditions:

25         1.  If vested, benefits shall be payable only to a

26  participant, or to his or her beneficiaries as designated by

27  the participant.

28         2.  Benefits shall be paid by the third-party

29  administrator or designated approved providers in accordance

30  with the law, the contracts, and any applicable board rule or

31  policy.

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  1         3.  To begin receiving the employer-funded benefits,

  2  the participant must be terminated from all employment with

  3  all Florida Retirement System employers, as provided in s.

  4  121.021(39), or the participant must be deceased. If a

  5  participant elects to receive his or her employer-funded

  6  benefits upon termination of employment, the participant must

  7  submit a written application to the third-party administrator

  8  indicating his or her preferred distribution date and

  9  selecting an authorized method of distribution as provided in

10  paragraph (d). The participant may defer receipt of

11  employer-funded benefits until he or she chooses to make such

12  application, subject to federal requirements.

13         4.  In the event of a participant's death, moneys

14  accumulated by, or on behalf of, the participant, less

15  withholding taxes remitted to the Internal Revenue Service,

16  shall be distributed to the participant's designated

17  beneficiary or beneficiaries, or to the participant's estate,

18  as if the participant retired on the date of death, as

19  provided in paragraph (e). No other death benefits shall be

20  available for survivors of participants under the Public

21  Employee Optional Retirement Program, except for such

22  benefits, or coverage for such benefits, as are separately

23  afforded by the employer, at the employer's discretion.

24         (d)  Upon receipt by the third-party administrator of a

25  properly executed application for distribution of benefits,

26  the total accumulated employer-funded benefit shall be payable

27  to the participant, as:

28         1.  A lump-sum distribution to the participant;

29         2.  A lump-sum direct rollover distribution whereby all

30  accrued benefits, plus interest and investment earnings, are

31  paid from the participant's account directly to the custodian

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  1  of an eligible retirement plan, as defined in s. 402(c)(8)(B)

  2  of the Internal Revenue Code, on behalf of the participant; or

  3         3.  Periodic distributions, as authorized by the state

  4  board.

  5         (e)  Survivor benefits shall be payable as:

  6         1.  A lump-sum distribution payable to the

  7  beneficiaries, or to the deceased participant's estate;

  8         2.  An eligible rollover distribution on behalf of the

  9  surviving spouse of a deceased participant, whereby all

10  accrued benefits, plus interest and investment earnings, are

11  paid from the deceased participant's account directly to the

12  custodian of an individual retirement account or an individual

13  retirement annuity, as described in s. 402(c)(9) of the

14  Internal Revenue Code, on behalf of the surviving spouse; or

15         3.  A partial lump-sum payment whereby a portion of the

16  accrued benefit is paid to the deceased participant's

17  surviving spouse or other designated beneficiaries, less

18  withholding taxes remitted to the Internal Revenue Service,

19  and the remaining amount is transferred directly to the

20  custodian of an individual retirement account or an individual

21  retirement annuity, as described in s. 402(c)(9) of the

22  Internal Revenue Code, on behalf of the surviving spouse. The

23  proportions must be specified by the participant or the

24  surviving beneficiary.

25

26  This paragraph does not abrogate other applicable provisions

27  of state or federal law providing for payment of death

28  benefits.

29         (f)  The benefits payable to any person under the

30  Public Employee Optional Retirement Program, and any

31  contributions accumulated under such program, are not subject

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  1  to assignment, execution, attachment, or any legal process,

  2  except for qualified domestic relations orders by a court of

  3  competent jurisdiction, income deduction orders as provided in

  4  s. 61.1301, and federal income tax levies.

  5         (8)  ADMINISTRATION OF PROGRAM.--

  6         (a)  The Public Employee Optional Retirement Program

  7  shall be administered by the state board and affected

  8  employers. The board shall adopt rules establishing the role

  9  and responsibilities of affected state, local government, and

10  education-related employers, the state board, the department,

11  and third-party contractors in administering the Public

12  Employee Optional Retirement Program. The department shall

13  adopt rules necessary to implement the optional program in

14  coordination with the defined benefit retirement program and

15  the disability benefits available under the optional program.

16         (b)1.  The state board shall select and contract with

17  one third-party administrator to provide administrative

18  services. With the approval of the state board, the

19  third-party administrator may subcontract with other

20  organizations to provide components of the administrative

21  services. As a cost of administration, the board may

22  compensate any such contractor for its services, in accordance

23  with the terms of the contract, as is deemed necessary or

24  proper by the board. The third-party administrator may not be

25  an approved provider or be affiliated with an approved

26  provider.

27         2.  Administrative services include, but are not

28  limited to, services relating to consolidated billing;

29  individual and collective recordkeeping and accounting; asset

30  purchase, control, and safekeeping; and direct disbursement of

31  funds to and from the third-party administrator, the division,

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  1  the board, employers, participants, approved providers, and

  2  beneficiaries.

  3         3.  The state board shall select and contract with one

  4  or more organizations to provide educational services. With

  5  approval of the board, the organizations may subcontract with

  6  other organizations to provide components of the educational

  7  services. As a cost of administration, the board may

  8  compensate any such contractor for its services in accordance

  9  with the terms of the contract, as is deemed necessary or

10  proper by the board. The education organization may not be an

11  approved provider or be affiliated with an approved provider.

12         4.  Educational services shall be designed to assist

13  employers, eligible employees, participants, and beneficiaries

14  in order to maintain compliance with United States Department

15  of Labor regulations under section 404(c) of the Employee

16  Retirement Income Security Act of 1974 and to assist employees

17  in their choice of defined benefit or defined contribution

18  retirement alternatives. Educational services include, but are

19  not limited to, disseminating educational materials; providing

20  retirement planning education; explaining the differences

21  between the defined benefit retirement plan and the defined

22  contribution retirement plan; and offering financial planning

23  guidance on matters such as investment diversification,

24  investment risks, investment costs, and asset allocation. An

25  approved provider may also provide educational information,

26  including, but not limited to, retirement planning and

27  investment allocation information concerning its products and

28  services.

29         (c)1.  In evaluating and selecting a third-party

30  administrator, the board shall establish criteria under which

31  it shall consider the relative capabilities and qualifications

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  1  of each proposed administrator. In developing such criteria,

  2  the board shall consider:

  3         a.  The administrator's demonstrated experience in

  4  providing administrative services to public or private sector

  5  retirement systems.

  6         b.  The administrator's demonstrated experience in

  7  providing daily valued recordkeeping to defined contribution

  8  plans.

  9         c.  The administrator's ability and willingness to

10  coordinate its activities with the Florida Retirement System

11  employers, the board, and the division, and to supply to such

12  employers, the board, and the division the information and

13  data they require, including, but not limited to, monthly

14  management reports, quarterly participant reports, and ad hoc

15  reports requested by the department or board.

16         d.  The cost-effectiveness and levels of the

17  administrative services provided.

18         e.  The administrator's ability to interact with the

19  participants, the employers, the board, the division, and the

20  providers; the means by which participants may access account

21  information, direct investment of contributions, make changes

22  to their accounts, transfer moneys between available

23  investment vehicles, transfer moneys between investment

24  products; and any fees that apply to such activities.

25         f.  Any other factor deemed necessary by the Trustees

26  of the State Board of Administration.

27         g.  The recommendations of the Public Employee Optional

28  Retirement Program Advisory Committee established in

29  subsection (12).

30         2.  In evaluating and selecting an educational

31  provider, the board shall establish criteria under which it

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  1  shall consider the relative capabilities and qualifications of

  2  each proposed educational provider. In developing such

  3  criteria, the board shall consider:

  4         a.  Demonstrated experience in providing educational

  5  services to public or private sector retirement systems.

  6         b.  Ability and willingness to coordinate its

  7  activities with the Florida Retirement System employers, the

  8  board, and the division, and to supply to such employers, the

  9  board, and the division the information and data they require,

10  including, but not limited to, reports on educational

11  contacts.

12         c.  The cost-effectiveness and levels of the

13  educational services provided.

14         d.  Ability to provide educational services via

15  different media, including, but not limited to, the Internet,

16  personal contact, seminars, brochures, and newsletters.

17         e.  Any other factor deemed necessary by the Trustees

18  of the State Board of Administration.

19         f.  The recommendations of the Public Employee Optional

20  Retirement Program Advisory Committee established in

21  subsection (12).

22         3.  The establishment of the criteria shall be solely

23  within the discretion of the board.

24         (d)  The board shall develop the form and content of

25  all contracts to be offered under the Public Employee Optional

26  Retirement Program. In developing its contracts, the board

27  must consider:

28         1.  The nature and extent of the rights and benefits to

29  be afforded participants in relation to the required

30  contributions under the program.

31

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  1         2.  The suitability of the rights and benefits to be

  2  afforded participants to the needs of the participants and the

  3  interests of employers in the recruitment and retention of

  4  eligible employees.

  5         (e)1.  The board may contract with any consultant for

  6  professional services, including legal, consulting,

  7  accounting, and actuarial services, deemed necessary to

  8  implement and administer the optional program by the Trustees

  9  of the State Board of Administration. The board may enter into

10  a contract with one or more vendors to provide low-cost

11  investment advice to participants, supplemental to education

12  provided by the third-party administrator. All fees under any

13  such contract shall be paid by those participants who choose

14  to use the services of the vendor.

15         2.  The department may contract with consultants for

16  professional services, including legal, consulting,

17  accounting, and actuarial services, deemed necessary to

18  implement and administer the optional program in coordination

19  with the defined benefit program of the Florida Retirement

20  System. The department, in coordination with the boards may

21  enter into a contract with the third-party administrator in

22  order to coordinate services common to the various programs

23  within the Florida Retirement System.

24         (f)  The third-party administrator shall not receive

25  direct or indirect compensation from an approved provider,

26  except as specifically provided for in the contract with the

27  board.

28         (g)  The board shall resolve any conflict between the

29  third-party administrator and an approved provider, when such

30  conflict threatens the implementation or administration of the

31  program or the quality of services to employees.

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  1         (9)  INVESTMENT OPTIONS OR PRODUCTS; PERFORMANCE

  2  REVIEW.--

  3         (a)  The board shall develop policy and procedures for

  4  selecting, evaluating, and monitoring the performance of

  5  investment products to which employees may direct retirement

  6  contributions under the program. In accordance with such

  7  policy and procedures, the board shall designate and contract

  8  for a number of investment products as determined by the

  9  board. The board shall select one or more providers who offer

10  multiple investment products when such an approach is

11  determined by the board to afford value to the participants

12  otherwise not available through individual investment

13  products.

14         (b)  The board shall consider investment options or

15  products it considers appropriate to give participants the

16  opportunity to accumulate retirement benefits, subject to the

17  following:

18         1.  The Public Employee Optional Retirement Program

19  must offer a diversified mix of low-cost investment products

20  that span the risk-return spectrum.

21         2.  Investment options or products offered by the group

22  of approved providers may include mutual funds, group annuity

23  contracts, individual retirement annuities, interests in

24  trusts, and other such financial instruments.

25         3.  The board shall not contract with any provider that

26  imposes a front-end, back-end, contingent or deferred sales

27  charge, or any other fee that limits or restricts the ability

28  of participants to select any investment product available in

29  the optional program.

30         (c)  In evaluating and selecting approved providers and

31  products, the board shall establish criteria under which it

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  1  shall consider the relative capabilities and qualifications of

  2  each proposed provider company and product. In developing such

  3  criteria, the board shall consider:

  4         1.  Experience in the United States providing

  5  retirement products and related financial services under

  6  defined contribution retirement plans.

  7         2.  Financial strength and stability which shall be

  8  evidenced by the highest ratings assigned by nationally

  9  recognized rating services when comparing proposed providers

10  that are so rated.

11         3.  Intrastate and interstate portability of the

12  product offered, including early withdrawal options.

13         4.  Compliance with the Internal Revenue Code.

14         5.  The cost-effectiveness of the product provided and

15  the levels of service supporting the product relative to its

16  benefits and its characteristics, including, without

17  limitation, the level of risk borne by the provider.

18         6.  The provider company's ability and willingness to

19  coordinate its activities with Florida Retirement System

20  employers, the department, and the board, and to supply to

21  such employers, the department, and the board the information

22  and data they require.

23         7.  The methods available to participants to interact

24  with the provider company; the means by which participants may

25  access account information, direct investment of

26  contributions, make changes to their accounts, transfer moneys

27  between available investment vehicles, and transfer moneys

28  between provider companies; and any fees that apply to such

29  activities.

30         8.  The provider company's policies with respect to the

31  transfer of individual account balances, contributions, and

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  1  earnings thereon, both internally among investment products

  2  offered by the provider company and externally between

  3  approved providers, as well as any fees, charges, reductions,

  4  or penalties that may be applied.

  5         9.  An evaluation of specific investment products,

  6  taking into account each product's track record in meeting its

  7  investment return objectives net of all related fees,

  8  expenses, and charges, including, but not limited to,

  9  investment management fees, loads, distribution and marketing

10  fees, custody fees, recordkeeping fees, education fees,

11  annuity expenses, and consulting fees.

12         10.  Organizational factors, including, but not limited

13  to, financial solvency, organizational depth, and experience

14  in providing institutional and retail investment services.

15         (d)  As a condition of offering any investment option

16  or product in the optional retirement program, the approved

17  provider must agree to make the investment product or service

18  available under the most beneficial terms offered to any other

19  customer, subject to approval by the Trustees of the State

20  Board of Administration.

21         (e)  The board shall regularly review the performance

22  of each approved provider and product and related

23  organizational factors to ensure continued compliance with

24  established selection criteria and with board policy and

25  procedures. Providers and products may be terminated subject

26  to contract provisions. The board shall adopt procedures to

27  transfer account balances from terminated products or

28  providers to other products or providers in the optional

29  program.

30         (10)  EDUCATION COMPONENT.--

31

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  1         (a)  The board shall provide for an education component

  2  for system members in a manner consistent with the provisions

  3  of this section. The education component must be available to

  4  eligible employees at least 90 days prior to the beginning

  5  date of the election period for the employees of the

  6  respective types of employers.

  7         (b)  The education component must provide system

  8  members with impartial and balanced information about plan

  9  choices. The education component must involve multimedia

10  formats. Program comparisons must, to the greatest extent

11  possible, be based upon the retirement income that different

12  retirement programs may provide to the participant. The board

13  shall monitor the performance of the contract to ensure that

14  the program is conducted in accordance with the contract,

15  applicable law, and the rules of the board.

16         (c)  The board shall provide for an initial and ongoing

17  transfer education component to provide system members with

18  information necessary to make informed plan choice decisions.

19  The transfer education component must include, but is not

20  limited to, information on:

21         1.  The amount of money available to a member to

22  transfer to the defined contribution program.

23         2.  The features of and differences between the defined

24  benefit program and the defined contribution program, both

25  generally and specifically, as those differences may affect

26  the member.

27         3.  The expected benefit available if the member were

28  to retire under each of the retirement programs, based on

29  appropriate alternative sets of assumptions.

30         4.  The rate of return from investments in the defined

31  contribution program and the period of time over which such

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  1  rate of return must be achieved to equal or exceed the

  2  expected monthly benefit payable to the member under the

  3  defined benefit program.

  4         5.  The historical rates of return for the investment

  5  alternatives available in the defined contribution programs.

  6         6.  The benefits and historical rates of return on

  7  investments available in deferred compensation plans or a plan

  8  under s. 403(b) of the Internal Revenue Code for which the

  9  employee may be eligible.

10         7.  The program choices available to employees of the

11  State University System and the comparative benefits of each

12  available program, if applicable.

13         8.  Payout options available in each of the retirement

14  programs.

15         (d)  An ongoing education and communication component

16  must provide system members with information necessary to make

17  informed decisions about choices within their program of

18  membership and in preparation for retirement. The component

19  must include, but is not limited to, information concerning:

20         1.  Rights and conditions of membership.

21         2.  Benefit features within the program, options, and

22  effects of certain decisions.

23         3.  Coordination of contributions and benefits with a

24  deferred compensation plan under s. 457 or a plan under s.

25  403(b) of the Internal Revenue Code.

26         4.  Significant program changes.

27         5.  Contribution rates and program funding status.

28         6.  Planning for retirement.

29         (e)  Descriptive materials must be prepared under the

30  assumption that the employee is an unsophisticated investor,

31

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  1  and all materials used in the education component must be

  2  approved by the state board prior to dissemination.

  3         (f)  The board and the department shall also establish

  4  a communication component to provide program information to

  5  participating employers and the employers' personnel and

  6  payroll officers and to explain their respective

  7  responsibilities in conjunction with the retirement programs.

  8         (g)  Funding for education of new employees may reflect

  9  administrative costs to the optional program and the defined

10  benefit program.

11         (11)  PARTICIPANT INFORMATION REQUIREMENTS.--The board

12  shall ensure that each participant is provided a quarterly

13  statement that accounts for the contributions made on behalf

14  of such participants; the interest and investment earnings

15  thereon; and any fees, penalties, or other deductions that

16  apply thereto. At a minimum, such statements must:

17         (a)  Indicate the participant's investment options.

18         (b)  State the market value of the account at the close

19  of the current quarter and previous quarter.

20         (c)  Show account gains and losses for the period and

21  changes in account accumulation unit values for the period.

22         (d)  Itemize account contributions for the quarter.

23         (e)  Indicate any account changes due to adjustment of

24  contribution levels, reallocation of contributions, balance

25  transfers, or withdrawals.

26         (f)  Set forth any fees, charges, penalties, and

27  deductions that apply to the account.

28         (g)  Indicate the amount of the account in which the

29  participant is fully vested and the amount of the account in

30  which the participant is not vested.

31

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  1         (h)  Indicate each investment product's performance

  2  relative to an appropriate market benchmark.

  3

  4  The third-party administrator shall provide quarterly and

  5  annual summary reports to the board and any other reports

  6  requested by the department or the board.

  7         (12)  ADVISORY COMMITTEES TO PROVIDE ADVICE AND

  8  ASSISTANCE.--The Investment Advisory Council and the Public

  9  Employee Optional Retirement Program Advisory Committee shall

10  assist the board in implementing and administering the Public

11  Employee Optional Retirement Program.

12         (a)  The Investment Advisory Council, created pursuant

13  to s. 215.444, shall review the board's initial

14  recommendations regarding the criteria to be used in selecting

15  and evaluating approved providers and investment products. The

16  council may provide comments on the recommendations to the

17  board within 45 days after receiving the initial

18  recommendations. The board shall make the final determination

19  as to whether any investment provider or product, any

20  contractor, or any and all contract provisions shall be

21  approved for the program.

22         (b)1.  The Public Employee Optional Retirement Program

23  Advisory Committee shall be composed of seven members. The

24  President of the Senate shall appoint two members, the Speaker

25  of the House of Representatives shall appoint two members, the

26  Governor shall appoint one member, the Treasurer shall appoint

27  one member, and the Comptroller shall appoint one member. The

28  members of the advisory committee shall elect a member as

29  chair. The appointments shall be made by September 1, 2000,

30  and the committee shall meet to organize by October 1, 2000.

31  The initial appointments shall be for a term of 24 months.

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  1  Each appointing authority shall fill any vacancy occurring

  2  among its appointees for the remainder of the original.

  3         2.  The advisory committee shall make recommendations

  4  on the selection of the third-party administrator and related

  5  subcontractors and the selection, design, and implementation

  6  of the education component of the program, and the selection

  7  of investment products and providers. The committee's

  8  recommendations on selection criteria for the third-party

  9  administrator must be forwarded to the Trustees of the State

10  Board of Administration by January 1, 2001. The

11  recommendations on the design and implementation of the

12  education component must be forwarded to the trustees by May

13  1, 2001.

14         3.  The advisory committee's recommendations and

15  activities shall be guided by the best interests of the

16  employees, considering the interests of employers, and the

17  intent of the Legislature in establishing the Public Employee

18  Optional Retirement Program.

19         4.  The staff of the state board and the department

20  shall assist the advisory committee.

21         (13)  FEDERAL REQUIREMENTS.--

22         (a)  Provisions of this section shall be construed, and

23  the Public Employee Optional Retirement Program shall be

24  administered, so as to comply with the Internal Revenue Code,

25  26 U.S.C., and specifically with plan qualification

26  requirements imposed on governmental plans under s. 401(a) of

27  the Internal Revenue Code.

28         (b)  Any section or provision of this chapter which is

29  susceptible to more than one construction must be interpreted

30  in favor of the construction most likely to satisfy

31

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  1  requirements imposed by s. 401(a) of the Internal Revenue

  2  Code.

  3         (c)  Contributions payable under this section for any

  4  limitation year may not exceed the maximum amount allowable

  5  for qualified defined contribution pension plans under

  6  applicable provisions of the Internal Revenue Code. If an

  7  employee who has elected to participate in the Public Employee

  8  Optional Retirement Program participates in any other plan

  9  that is maintained by the participating employer, benefits

10  that accrue under the Public Employee Optional Retirement

11  Program shall be considered primary for any aggregate

12  limitation applicable under s. 415 of the Internal Revenue

13  Code.

14         (14)  INVESTMENT POLICY STATEMENT.--

15         (a)  Investment products and approved providers

16  selected for the Public Employee Optional Retirement Program

17  shall be in conformance with the Public Employee Optional

18  Retirement Program Investment Policy Statement, herein

19  referred to as the "statement," as developed and approved by

20  the Trustees of the State Board of Administration. The

21  statement must include, among other items, the investment

22  objectives of the Public Employee Optional Retirement Program,

23  manager selection and monitoring guidelines, and performance

24  measurement criteria. As required from time to time, the

25  executive director of the state board may present recommended

26  changes in the statement to the board for approval.

27         (b)  Prior to presenting the statement, or any

28  recommended changes thereto, to the state board, the executive

29  director of the board shall present such statement or changes

30  to the Investment Advisory Council for review. The council

31  shall present the results of its review to the board prior to

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  1  the board's final approval of the statement or changes in the

  2  statement.

  3         (15)  STATEMENT OF FIDUCIARY STANDARDS AND

  4  RESPONSIBILITIES.--

  5         (a)  Investment of optional defined contribution

  6  retirement plan assets shall be made for the sole interest and

  7  exclusive purpose of providing benefits to plan participants

  8  and beneficiaries and defraying reasonable expenses of

  9  administering the plan. The program's assets are to be

10  invested, on behalf of the program participants, with the

11  care, skill, and diligence that a prudent person acting in a

12  like manner would undertake. The performance of the investment

13  duties set forth in this paragraph shall comply with the

14  fiduciary standards set forth in the Employee Retirement

15  Income Security Act of 1974 at 29 U.S.C. s. 1104(a)(1)(A)-(C).

16  In case of conflict with other provisions of law authorizing

17  investments, the investment and fiduciary standards set forth

18  in this subsection shall prevail.

19         (b)  If a participant or beneficiary of the Public

20  Employee Optional Retirement Program exercises control over

21  the assets in his or her account, as determined by reference

22  to regulations of the United States Department of Labor under

23  section 404(c) of the Employee Retirement Income Security Act

24  of 1974 and all applicable laws governing the operation of the

25  program, no program fiduciary shall be liable for any loss to

26  a participant's or beneficiary's account which results from

27  such participant's or beneficiary's exercise of control.

28         (16)  DISABILITY BENEFITS.--For any member of the

29  optional retirement program who becomes totally and

30  permanently disabled, as defined in s. 121.091(4)(b), the

31  member shall be entitled to receive those moneys that have

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  1  accrued in his or her participant account. It is the intent of

  2  the Legislature to provide participants of the Public Employee

  3  Optional Retirement Program disability benefits comparable to

  4  the benefits afforded defined benefit program participants.

  5  The department is directed to study the potential options of

  6  such coverage and the fiscal impacts on the employees and

  7  employers, and to make recommendations to the Legislature by

  8  January 1, 2001.

  9         (17)  SOCIAL SECURITY COVERAGE.--

10         (a)  Social security coverage shall be provided for all

11  officers and employees who become participants of the optional

12  program.  Any modification of the present agreement with the

13  Social Security Administration, or referendum required under

14  the Social Security Act, for the purpose of providing social

15  security coverage for any member shall be requested by the

16  state agency in compliance with the applicable provisions of

17  the Social Security Act governing such coverage.  However,

18  retroactive social security coverage for service prior to

19  December 1, 1970, with the employer shall not be provided for

20  any member who was not covered under the agreement as of

21  November 30, 1970.

22         (b)  All officers and employees who are participants of

23  the optional program shall be eligible to receive the retiree

24  health insurance subsidy, subject to the provisions of s.

25  112.363.

26         121.571  Contributions.--Contributions to the Public

27  Employee Optional Retirement Program shall be made as follows:

28         (1)  CONTRIBUTION RATES GENERALLY.--The contributions

29  established in this section shall fund the Public Employee

30  Optional Retirement Program and shall be paid by each

31  participant's employer to the third-party administrator based

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  1  on the class membership of the participant. The contributions

  2  are stated as a percentage of each participant's gross

  3  compensation for the calendar month. A change in a

  4  contribution rate is effective the first day of the month for

  5  which a full month's employer contribution is made on or after

  6  the beginning date of the change. Contribution rates may be

  7  modified by general law.

  8         (2)  CONTRIBUTIONS TO PARTICIPANTS' ACCOUNTS.--Employer

  9  and participant contributions to participant accounts shall be

10  accounted for separately. Interest and investment earnings on

11  employer contributions shall accrue on a tax-deferred basis

12  until proceeds are distributed. Pursuant thereto:

13         (a)  All contributions made by or on behalf of a

14  participant pursuant to this subsection shall be transferred

15  by the employer to the third-party administrator for deposit

16  in the participant's account, less an amount approved by the

17  Legislature to fund the administration of the optional

18  retirement program.

19         (b)  Retirement contributions for Regular Class members

20  of the optional retirement plan are as follows:

21         Dates of Contribution    Employers

22         Rate Changes

23         Effective July 1, 2002:      8.89%

24         (c)  Retirement contributions for Special Risk Class

25  members of the optional retirement plan are as follows:

26         Dates of Contribution    Employers

27         Rate Changes

28         Effective July 1, 2002:     19.87%

29         (d)  Retirement contributions for Special Risk

30  Administrative Support Class members of the optional

31  retirement plan are as follows:

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  1         Dates of Contribution    Employers

  2         Rate Changes

  3         Effective July 1, 2002:     11.24%

  4         (e)  Retirement contributions for Elected Officers'

  5  Class members of the optional retirement plan are as follows:

  6         Dates of Contribution    Employers

  7         Rate Changes

  8         Effective July 1, 2002:

  9           Legislators               13.29%

10           Governor, Lt. Governor,

11              Cabinet Officers       13.29%

12           State Attorneys, Public

13              Defenders              13.29%

14           Justices, Judges          18.79%

15           County Elected Officers   16.11%

16         (f)  Retirement contributions for Senior Management

17  Service Class members of the optional retirement plan are as

18  follows:

19         Dates of Contribution    Employers

20         Rate Changes

21         Effective July 1, 2002:     10.86%

22         (3)  CONTRIBUTIONS TO DISABILITY ACCOUNT.--

23         (a)  All contributions made on behalf of a participant

24  pursuant to this subsection shall be transferred by the

25  employer to the third-party administrator for deposit in the

26  Public Employee Disability Trust Fund administered by the

27  Division of Retirement. Such contributions, less any fees or

28  charges authorized by the Legislature to offset the costs of

29  administering the disability component of the optional

30  retirement program, shall be used to provide disability

31  coverage for participants in the optional retirement program.

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  1         (b)  Disability contributions for Regular Class members

  2  of the optional retirement plan are as follows:

  3         Dates of Contribution    Employers

  4         Rate Changes

  5         Effective July 1, 2002:      0.50%

  6         (c)  Disability contribution for Special Risk Class

  7  members of the optional retirement plan are as follows:

  8         Dates of Contribution    Employers

  9         Rate Changes

10         Effective July 1, 2002:      1.38%

11         (d)  Disability contribution for Special Risk

12  Administrative Support Class members of the optional

13  retirement plan are as follows:

14         Dates of Contribution    Employers

15         Rate Changes

16         Effective July 1, 2002:      0.84%

17         (e)  Disability contribution for Elected Officers'

18  Class members of the optional retirement plan are as follows:

19         Dates of Contribution    Employers

20         Rate Changes

21         Effective July 1, 2002:

22           Legislators                0.72%

23           Governor, Lt. Governor,

24              Cabinet Officers        0.72%

25           State Attorneys, Public

26              Defenders               0.72%

27           Justices, Judges           1.56%

28           County Elected Officers    0.95%

29         (f)  Disability contribution for Senior Management

30  Service Class members of the optional retirement plan are as

31  follows:

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  1         Dates of Contribution    Employers

  2         Rate Changes

  3         Effective July 1, 2002:      0.59%

  4         (4)  CONTRIBUTIONS FOR SOCIAL SECURITY COVERAGE AND FOR

  5  RETIREE HEALTH INSURANCE SUBSIDY.--Contributions required

  6  under this section shall be in addition to employer and member

  7  contributions required for social security and the Retiree

  8  Health Insurance Subsidy Trust Fund as provided in s. 121.071.

  9         (5)  ADMINISTRATIVE AND EDUCATIONAL CONTRIBUTIONS.--The

10  contribution rate for each employer shall be 0.1 percent on

11  behalf of each participant to fund the administrative and

12  educational expenses of the optional program. All

13  contributions made on behalf of a participant pursuant to this

14  subsection shall be transferred to the third-party

15  administrator for deposit in the board's administrative fund.

16         (6)  DEDUCTIONS.--The board or the third-party

17  administrator may deduct reasonable fees and apply appropriate

18  charges to participants' accounts. Payments for third-party

19  administrative or educational expenses shall be made only

20  pursuant to the terms of the approved contracts for such

21  services. In no event shall administrative and educational

22  expenses exceed the portion of employer contributions

23  earmarked for such expenses pursuant to this section.

24  Investment management fees shall be deducted from the gross

25  returns earned by each authorized investment product, pursuant

26  to the terms of the contract between the product vendor and

27  the board.

28         (7)  PAYMENT AND DISTRIBUTION OF

29  CONTRIBUTIONS.--Contributions made pursuant to this section

30  shall be paid by the employer to the third-party administrator

31  by electronic funds transfer no later than the 5th day of the

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  1  month immediately following the month during which the payroll

  2  period ended. The board and the third-party administrator

  3  shall ensure that the contributions are distributed to the

  4  appropriate trust funds or participant accounts in a timely

  5  manner.

  6         Section 4.  Effective July 1, 2001, subsections (29)

  7  and (45) of section 121.021, Florida Statutes, are amended to

  8  read:

  9         121.021  Definitions.--The following words and phrases

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

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

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

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

14  following statuses:

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

16         1.  Completes 8 10 or more years of creditable service

17  and attains age 62; or

18         2.  Completes 30 years of creditable service,

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

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

21  under any other system.

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

23         1.  Completes 8 10 or more years of creditable service

24  in the Special Risk Class and attains age 55;

25         2.  Completes 25 years of creditable service in the

26  Special Risk Class, regardless of age; or

27         3.  Completes 25 years of creditable service and

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

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

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

31  the Special Risk Class.

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  1         (c)  If a Senior Management Service Class member, the

  2  member:

  3         1.  Completes 7 years of creditable service in the

  4  Senior Management Service Class and attains age 62; or

  5         2.  Completes 30 years of any creditable service,

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

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

  8  under any other system.

  9         (d)  If an Elected Officers' Class member, the member:

10         1.  Completes 8 years of creditable service in the

11  Elected Officers' Class and attains age 62; or

12         2.  Completes 30 years of any creditable service,

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

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

15  under any other system.

16

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

18  date."

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

20  a member is eligible to receive a future retirement benefit

21  upon completion of the required years of creditable service

22  for the employee's class of membership, even though the member

23  may have terminated covered employment before reaching normal

24  or early retirement date. Being vested does not entitle a

25  member to a disability benefit. Provisions governing

26  entitlement to disability benefits are set forth under s.

27  121.091(4) based on a disability caused by an injury or

28  disease that occurs after termination of covered employment.

29         (b)  Effective July 1, 2001, an 8-year vesting

30  requirement shall be implemented for the Regular Class, the

31  Special Risk Class, and the Special Risk Administrative

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  1  Support Class of the defined benefit program of the Florida

  2  Retirement System.  Pursuant thereto:

  3         1.  Any member employed in a regularly established

  4  position on July 1, 2001, who completes or has completed a

  5  total of 8 years of creditable service shall be considered

  6  vested as described in paragraph (a).

  7         2.  Any member not employed in a regularly established

  8  position on July 1, 2001, shall be deemed vested upon

  9  completion of 8 years of creditable service, provided that

10  such member is employed in a covered position for at least 1

11  work year after July 1, 2001.  However, no member shall be

12  required to complete more years of creditable service than

13  would have been required for that member to vest under

14  retirement laws in effect before July 1, 2001.

15         Section 5.  Effective July 1, 2001, paragraph (a) of

16  subsection (2) of section 121.051, Florida Statutes, is

17  amended to read:

18         121.051  Participation in the system.--

19         (2)  OPTIONAL PARTICIPATION.--

20         (a)1.  Any officer or employee who is a member of an

21  existing system, except any officer or employee of any

22  nonprofit professional association or corporation, may elect,

23  if eligible, to become a member of this system at any time

24  between April 15, 1971, and June 1, 1971, inclusive, by

25  notifying his or her employer in writing of the desire to

26  transfer membership from the existing system to this system.

27  Any officer or employee who was a member of an existing system

28  on December 1, 1970, and who did not elect to become a member

29  of this system shall continue to be covered under the existing

30  system subject to the provisions of s. 121.045.  A person who

31  has retired under any state retirement system shall not be

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  1  eligible to transfer to the Florida Retirement System created

  2  by this chapter subsequent to such retirement.  Any officer or

  3  employee who, prior to July 1, 1947, filed a written rejection

  4  of membership in a state retirement system and who continues

  5  employment without participating in the Florida Retirement

  6  System may withdraw the rejection in writing and, if otherwise

  7  eligible, participate in the Florida Retirement System and

  8  purchase prior service in accordance with this chapter.  Any

  9  former member of an existing system who was permitted to

10  transfer to the Florida Retirement System while employed by

11  the University Athletic Association, Inc., a nonprofit

12  association connected with the University of Florida, during

13  this or subsequent transfer periods, contrary to the

14  provisions of this paragraph, is hereby confirmed as a member

15  of the Florida Retirement System, the provisions of this

16  paragraph to the contrary notwithstanding.  Any officer or

17  employee of the University Athletic Association, Inc.,

18  employed prior to July 1, 1979, who was a member of the

19  Florida Retirement System and who chose in writing on a

20  University Athletic Association Plan Participation Election

21  form, between July 1, 1979, and March 31, 1980, inclusively,

22  to terminate his or her participation in the Florida

23  Retirement System shall hereby have such termination of

24  participation confirmed and declared irrevocable retroactive

25  to the date Florida Retirement System retirement contributions

26  ceased to be reported for such officer or employee.  The

27  following specific conditions shall apply to any such officer

28  or employee whose participation was so terminated: The officer

29  or employee shall retain all creditable service earned in the

30  Florida Retirement System through the month that retirement

31  contributions ceased to be reported and no creditable service

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  1  shall be earned after such month; the officer or employee

  2  shall not be eligible for disability retirement or death in

  3  line of duty benefits if such occurred after the date that

  4  participation terminated; and, the officer or employee may

  5  participate in the Florida Retirement System in the future

  6  only if employed by a participating employer in a regularly

  7  established position.

  8         2.  Any member transferring from the existing system

  9  under chapter 238 shall retain rights to survivor benefits

10  under that chapter through November 30, 1975, or until fully

11  insured for disability benefits under social security,

12  whichever is the earliest date, and thereafter no such rights

13  shall exist.

14         3.  Any officer or employee who is a member of an

15  existing system on April 15, 1972, and who was eligible to

16  transfer to this system under the provisions of subparagraph

17  1., but who elected to remain in the existing system, may

18  elect, if eligible under the Social Security Act, 42 U.S.C. s.

19  418(d)(6)(F), to become a member of this system at any time

20  between April 15, 1972, and June 30, 1972, inclusive, by

21  notifying his or her employer in writing of the desire to

22  transfer membership from an existing system to this system.

23  Such transfer shall be subject to the following conditions:

24         a.  All persons electing to transfer to the Florida

25  Retirement System under this subparagraph shall be transferred

26  on July 1, 1972, and shall thereafter be subject to the

27  provisions of the Florida Retirement System retroactively to

28  November 30, 1970, and at retirement have their benefits

29  calculated in accordance with the provisions of s. 121.091.

30         b.  Social security coverage incidental to such

31  elective membership in the Florida Retirement System shall be

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  1  effective November 30, 1970, and all amounts required from a

  2  member for retroactive social security coverage shall, at the

  3  time such election is made, be deducted from the individual

  4  account of the member, and the difference between the amount

  5  remaining in the individual account of such member and the

  6  total amount which such member would have contributed had he

  7  or she become a member of the Florida Retirement System on

  8  November 30, 1970, shall be paid into the system trust fund

  9  and added to the member's individual account prior to July 1,

10  1975, or by his or her date of retirement, if earlier.

11  Interest at the rate of 8 percent per annum, compounded

12  annually until paid, shall be charged on any balance remaining

13  unpaid on said date.

14         c.  There is appropriated out of the system trust fund

15  into the Social Security Contribution Trust Fund the amount

16  required by federal laws and regulations to be contributed

17  with respect to social security coverage for the years after

18  November 30, 1970, of the members of an existing system who

19  transfer to the Florida Retirement System in accordance with

20  this subparagraph and who qualify for retroactive social

21  security coverage.  The amount paid from this appropriation

22  with respect to the employees of any employer shall be charged

23  to the employing agency.  There shall be credited against this

24  charge the difference between the matching contributions

25  actually made for the affected employees from November 30,

26  1970, to June 30, 1972, and the amount of matching

27  contributions that would have been required under the Florida

28  Retirement System.

29         d.  The net amounts charged the employing agencies for

30  employees transferring to the Florida Retirement System under

31  this subparagraph shall be paid to the system trust fund prior

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  1  to July 1, 1975.  Interest at the rate of 8 percent per annum,

  2  compounded annually until paid, shall be charged on any

  3  balance remaining unpaid on said date.

  4         e.  The administrator shall request such modification

  5  of the state's agreement with the Social Security

  6  Administration, or any referendum required under the Social

  7  Security Act governing social security coverage, as may be

  8  required to implement the provisions of this law.  Retroactive

  9  social security coverage for service with an employer prior to

10  November 30, 1970, shall not be provided for any member who

11  was not covered under the agreement as of November 30, 1970.

12         4.  Any officer or employee who was a member of an

13  existing system on December 1, 1970, and who is still a member

14  of an existing system, except any officer or employee of any

15  nonprofit professional association or corporation, may elect,

16  if eligible, to become a member of this system at any time

17  between September 1, 1974, and November 30, 1974, inclusive,

18  by notifying his or her employer in writing of the desire to

19  transfer membership from the existing system to this system.

20  This decision to transfer or not to transfer shall become

21  irrevocable on November 30, 1974.  All members electing to

22  transfer during the transfer period shall become members of

23  the Florida Retirement System on January 1, 1975, and shall be

24  subject to the provisions of the Florida Retirement System on

25  and after that date.  Any officer or employee who was a member

26  of an existing system on December 1, 1970, and who does not

27  elect to become a member of this system shall continue to be

28  covered under the existing system, subject to the provisions

29  of s. 121.045.  Any member transferring from the Teachers'

30  Retirement System of Florida under chapter 238 to the Florida

31  Retirement System on January 1, 1975, shall retain rights to

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  1  survivor benefits under chapter 238 from January 1, 1975,

  2  through December 31, 1979, or until fully insured for

  3  disability benefits under the Social Security Act, whichever

  4  is the earliest date, and thereafter no such rights shall

  5  exist.

  6         5.a.  Any officer or employee who was a member of an

  7  existing system on December 1, 1970, and who is still a member

  8  of an existing system, except any officer or employee of any

  9  nonprofit professional association or corporation, may elect,

10  if eligible, to become a member of this system at any time

11  between January 2, 1982, and May 31, 1982, inclusive, by

12  notifying his or her employer in writing of the desire to

13  transfer membership from the existing system to this system.

14  This decision to transfer or not to transfer shall become

15  irrevocable on May 31, 1982.  All members electing to transfer

16  during the transfer period shall become members of the Florida

17  Retirement System on July 1, 1982, and shall be subject to the

18  provisions of the Florida Retirement System on and after that

19  date.  Any officer or employee who was a member of an existing

20  system on December 1, 1970, and who does not elect to become a

21  member of this system shall continue to be covered under the

22  existing system, subject to the provisions of s. 121.045.  Any

23  member transferring from the Teachers' Retirement System under

24  chapter 238 to the Florida Retirement System on January 1,

25  1979, shall retain rights to survivor benefits under chapter

26  238 from January 1, 1979, through December 31, 1983, or until

27  fully insured for disability benefits under the federal Social

28  Security Act, whichever is the earliest date, and thereafter

29  no such rights shall exist.  Any such member transferring to

30  the Florida Retirement System on July 1, 1982, shall retain

31  rights to survivor benefits under chapter 238 from July 1,

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  1  1982, through June 30, 1987, or until fully insured for

  2  disability benefits under the federal Social Security Act,

  3  whichever is the earliest date, and thereafter no such rights

  4  shall exist.

  5         b.  Any deficit, as determined by the state actuary,

  6  accruing to the Survivors' Benefit Trust Fund of the Teachers'

  7  Retirement System and resulting from the passage of chapter

  8  78-308, Laws of Florida, and chapter 80-242, Laws of Florida,

  9  shall become an obligation of the Florida Retirement System

10  Trust Fund.

11         6.  Any active member of an existing system who was not

12  employed in a covered position during a time when transfer to

13  the Florida Retirement System was allowed as described in rule

14  22B-1.004(2)(a), Florida Administrative Code, or as provided

15  in paragraph (1)(c) of this section, may elect, if eligible,

16  to become a member of this system at any time between January

17  1, 1991, and May 29, 1991, inclusive, by notifying his or her

18  employer in writing of the desire to transfer membership from

19  the existing system to this system.  The decision to transfer

20  or not to transfer shall become irrevocable on May 29, 1991.

21  Failure to notify the employer shall result in compulsory

22  membership in the existing system.  All members electing to

23  transfer during the transfer period shall become members of

24  the Florida Retirement System on July 1, 1991, and shall be

25  subject to the provisions of the Florida Retirement System on

26  and after that date.  Any member so transferring from the

27  existing system under chapter 238 to the Florida Retirement

28  System on July 1, 1991, shall retain rights to survivor

29  benefits under that chapter from July 1, 1991, through June

30  30, 1996, or until fully insured for benefits under the

31

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  1  federal Social Security Act, whichever is the earliest date,

  2  and thereafter no such rights shall exist.

  3         Section 6.  Effective July 1, 2001, paragraph (a) of

  4  subsection (7) of section 121.0515, Florida Statutes, is

  5  amended to read:

  6         121.0515  Special risk membership; criteria;

  7  designation and removal of classification; credits for past

  8  service and prior service; retention of special risk normal

  9  retirement date.--

10         (7)  RETENTION OF SPECIAL RISK NORMAL RETIREMENT

11  DATE.--

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

13  to a nonspecial risk law enforcement, firefighting,

14  correctional, or emergency medical care administrative support

15  position with the same agency, or who is subsequently employed

16  in such a position with any law enforcement, firefighting,

17  correctional, or emergency medical care agency under the

18  Florida Retirement System, shall participate in the Special

19  Risk Administrative Support Class and shall earn credit for

20  such service at the same percentage rate as that earned by a

21  regular member.  Notwithstanding the provisions of subsection

22  (4), service in such an administrative support position shall,

23  for purposes of s. 121.091, apply toward satisfaction of the

24  special risk normal retirement date, as defined in s.

25  121.021(29)(b), provided that, while in such position, the

26  member remains certified as a law enforcement officer,

27  firefighter, correctional officer, emergency medical

28  technician, or paramedic; remains subject to reassignment at

29  any time to a position qualifying for special risk membership;

30  and completes an aggregate of 8 10 or more years of service as

31  a designated special risk member prior to retirement.

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  1         Section 7.  Effective July 1, 2001, subsection (8) of

  2  section 121.052, Florida Statutes, is amended to read:

  3         121.052  Membership class of elected officers.--

  4         (8)  NORMAL RETIREMENT DATE; VESTING REQUIREMENT.--A

  5  member of the Elected Officers' Class shall have the same

  6  normal retirement date as defined in s. 121.021(29) for a

  7  member of the regular class of the Florida Retirement System,

  8  except that only 8 years of creditable service in this class

  9  are needed to attain the normal retirement date specified in

10  s. 121.021(29)(a).  Any public service commissioner who was

11  removed from the Elected State Officers' Class on July 1,

12  1979, after attaining at least 8 years of creditable service

13  in that class shall be considered to have reached the normal

14  retirement date upon attaining age 62 as required in s.

15  121.021(29)(a).

16         Section 8.  Effective July 1, 2001, paragraph (a) of

17  subsection (1) of section 121.053, Florida Statutes, is

18  amended to read:

19         121.053  Participation in the Elected Officers' Class

20  for retired members.--

21         (1)(a)  Any member who retired under any existing

22  system as defined in s. 121.021(2), and receives a benefit

23  thereof, and who serves in an office covered by the Elected

24  Officers' Class for a period of at least 8 years, shall be

25  entitled to receive an additional retirement benefit for such

26  elected officer service prior to July 1, 1990, under the

27  Elected Officers' Class of the Florida Retirement System, as

28  follows:

29         1.  Upon completion of 8 or more years of creditable

30  service in an office covered by the Elected Officers' Class,

31  s. 121.052, such member shall notify the administrator of his

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  1  or her intent to purchase elected officer service prior to

  2  July 1, 1990, and shall pay the member contribution applicable

  3  for the period being claimed, plus 4 percent interest

  4  compounded annually from the first year of service claimed

  5  until July 1, 1975, and 6.5 percent interest compounded

  6  annually thereafter, until full payment is made to the Florida

  7  Retirement System Trust Fund; however, such member may

  8  purchase retirement credit under the Elected Officers' Class

  9  only for such service as an elected officer.

10         2.  Upon payment of the amount specified in

11  subparagraph 1., the employer shall pay into the Florida

12  Retirement System Trust Fund the applicable employer

13  contribution for the period of elected officer service prior

14  to July 1, 1990, being claimed by the member, plus 4 percent

15  interest compounded annually from the first year of service

16  claimed until July 1, 1975, and 6.5 percent interest

17  compounded annually thereafter, until full payment is made to

18  the Florida Retirement System Trust Fund.

19         Section 9.  Effective July 1, 2001, paragraph (i) of

20  subsection (1) of section 121.081, Florida Statutes, is

21  amended to read:

22         121.081  Past service; prior service;

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

24  service may be claimed and credited are:

25         (1)

26         (i)  An employee of a state agency who was a member of

27  a state-administered retirement system and who was granted

28  educational leave with pay pursuant to a written educational

29  leave-with-pay policy may claim such period of educational

30  leave as past service subject to the following conditions:

31

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  1         1.  The educational leave must have occurred prior to

  2  December 31, 1971;

  3         2.  The member must have completed at least 8 10 years

  4  of creditable service excluding the period of the educational

  5  leave;

  6         3.  The employee must have returned to employment with

  7  a state agency employer who participated in the retirement

  8  system, which return was immediately upon termination of the

  9  educational leave, and must have remained on the employer's

10  payroll for at least 1 calendar month following the return to

11  employment;

12         4.  The employee must be a member of the Florida

13  Retirement System at the time he or she claims such service;

14         5.  Not more than 24 months of creditable service may

15  be claimed for such period of educational leave with pay;

16         6.  The service must not be claimed under any other

17  state or federal retirement system; and

18         7.  The member must pay to the retirement trust fund

19  for claiming such past-service credit an amount equal to 8

20  percent of his or her gross annual salary immediately prior to

21  the educational leave with pay for each year of past service

22  claimed, plus 4 percent interest thereon compounded annually

23  each June 30 from the first year of service claimed until July

24  1, 1975, and 6.5 percent interest thereafter on the unpaid

25  balance compounded annually each June 30 until paid.

26         Section 10.  Effective July 1, 2001, paragraph (b) of

27  subsection (1) of section 121.1115, Florida Statutes, is

28  amended to read:

29         121.1115  Purchase of retirement credit for

30  out-of-state and federal service.--Effective January 1, 1995,

31  a member of the Florida Retirement System may purchase

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  1  creditable service for periods of public employment in another

  2  state and receive creditable service for such periods of

  3  employment. Service with the Federal Government, including any

  4  military service, may be claimed. Upon completion of each year

  5  of service earned under the Florida Retirement System, a

  6  member may purchase up to 1 year of retirement credit for his

  7  or her out-of-state service, subject to the following

  8  provisions:

  9         (1)  LIMITATIONS AND CONDITIONS.--To receive credit for

10  the out-of-state service:

11         (b)  The member must have completed a minimum of 8 10

12  years of creditable service under the Florida Retirement

13  System, excluding out-of-state service and in-state service

14  claimed and purchased under s. 121.1122.

15         Section 11.  Effective July 1, 2001, paragraph (a) of

16  subsection (2) of section 121.1122, Florida Statutes, is

17  amended to read:

18         121.1122  Purchase of retirement credit for in-state

19  public service and in-state service in accredited nonpublic

20  schools and colleges, including charter schools and charter

21  technical career centers.--Effective January 1, 1998, a member

22  of the Florida Retirement System may purchase creditable

23  service for periods of certain public or nonpublic employment

24  performed in this state, as provided in this section.

25         (2)  LIMITATIONS AND CONDITIONS.--

26         (a)  A member is not eligible to receive credit for

27  in-state service under this section until he or she has

28  completed 8 10 years of creditable service under the Florida

29  Retirement System, excluding service purchased under this

30  section and out-of-state service claimed and purchased under

31  s. 121.1115.

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  1         Section 12.  Effective July 1, 2001, paragraph (a) of

  2  subsection (1) of section 121.121, Florida Statutes, is

  3  amended to read:

  4         121.121  Authorized leaves of absence.--

  5         (1)  A member may purchase creditable service for up to

  6  2 work years of authorized leaves of absence if:

  7         (a)  The member has completed a minimum of 8 10 years

  8  of creditable service, excluding periods for which a leave of

  9  absence was authorized;

10         Section 13.  Effective July 1, 2001, paragraph (b) of

11  subsection (2) of section 215.32, Florida Statutes, is amended

12  to read:

13         215.32  State funds; segregation.--

14         (2)  The source and use of each of these funds shall be

15  as follows:

16         (b)1.  The trust funds shall consist of moneys received

17  by the state which under law or under trust agreement are

18  segregated for a purpose authorized by law.  The state agency

19  or branch of state government receiving or collecting such

20  moneys shall be responsible for their proper expenditure as

21  provided by law.  Upon the request of the state agency or

22  branch of state government responsible for the administration

23  of the trust fund, the Comptroller may establish accounts

24  within the trust fund at a level considered necessary for

25  proper accountability. Once an account is established within a

26  trust fund, the Comptroller may authorize payment from that

27  account only upon determining that there is sufficient cash

28  and releases at the level of the account.

29         2.  In order to maintain a minimum number of trust

30  funds in the State Treasury, each state agency or the judicial

31  branch may consolidate, if permitted under the terms and

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  1  conditions of their receipt, the trust funds administered by

  2  it; provided, however, the agency or judicial branch employs

  3  effectively a uniform system of accounts sufficient to

  4  preserve the integrity of such trust funds; and provided,

  5  further, that consolidation of trust funds is approved by the

  6  Administration Commission or the Chief Justice.

  7         3.  All such moneys are hereby appropriated to be

  8  expended in accordance with the law or trust agreement under

  9  which they were received, subject always to the provisions of

10  chapter 216 relating to the appropriation of funds and to the

11  applicable laws relating to the deposit or expenditure of

12  moneys in the State Treasury.

13         4.a.  Notwithstanding any provision of law restricting

14  the use of trust funds to specific purposes, unappropriated

15  cash balances from selected trust funds may be authorized by

16  the Legislature for transfer to the Budget Stabilization Fund

17  and Working Capital Fund in the General Appropriations Act.

18         b.  This subparagraph does not apply to trust funds

19  required by federal programs or mandates; trust funds

20  established for bond covenants, indentures, or resolutions

21  whose revenues are legally pledged by the state or public body

22  to meet debt service or other financial requirements of any

23  debt obligations of the state or any public body; the State

24  Transportation Trust Fund; the trust fund containing the net

25  annual proceeds from the Florida Education Lotteries; the

26  Florida Retirement System Trust Fund; trust funds under the

27  management of the Board of Regents, where such trust funds are

28  for auxiliary enterprises, self-insurance, and contracts,

29  grants, and donations, as those terms are defined by general

30  law; trust funds that serve as clearing funds or accounts for

31  the Comptroller or state agencies; trust funds that account

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  1  for assets held by the state in a trustee capacity as an agent

  2  or fiduciary for individuals, private organizations, or other

  3  governmental units; and other trust funds authorized by the

  4  State Constitution.

  5         Section 14.  Paragraph (h) of subsection (2) of section

  6  112.19, Florida Statutes, is amended to read:

  7         112.19  Law enforcement, correctional, and correctional

  8  probation officers; death benefits.--

  9         (2)

10         (h)1.  Any employer who employs a full-time law

11  enforcement, correctional, or correctional probation officer

12  who, on or after January 1, 1995, suffers a catastrophic

13  injury, as defined in s. 440.02(37), in the line of duty shall

14  pay the entire premium of the employer's health insurance plan

15  for the injured employee, the injured employee's spouse, and

16  for each dependent child of the injured employee until the

17  child reaches the age of majority or until the end of the

18  calendar year in which the child reaches the age of 25 if the

19  child continues to be dependent for support, or the child is a

20  full-time or part-time student and is dependent for support.

21  The term "health insurance plan" does not include supplemental

22  benefits that are not part of the basic group health insurance

23  plan.  If the injured employee subsequently dies, the employer

24  shall continue to pay the entire health insurance premium for

25  the surviving spouse until remarried, and for the dependent

26  children, under the conditions outlined in this paragraph.

27  However:

28         a.  Health insurance benefits payable from any other

29  source shall reduce benefits payable under this section.

30         b.  It is unlawful for a person to willfully and

31  knowingly make, or cause to be made, or to assist, conspire

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  1  with, or urge another to make, or cause to be made, any false,

  2  fraudulent, or misleading oral or written statement to obtain

  3  health insurance coverage as provided under this paragraph.  A

  4  person who violates this sub-subparagraph commits a

  5  misdemeanor of the first degree, punishable as provided in s.

  6  775.082 or s. 775.083.

  7         c.  In addition to any applicable criminal penalty,

  8  upon conviction for a violation as described in

  9  sub-subparagraph b., a law enforcement, correctional, or

10  correctional probation officer or other beneficiary who

11  receives or seeks to receive health insurance benefits under

12  this paragraph shall forfeit the right to receive such health

13  insurance benefits, and shall reimburse the employer for all

14  benefits paid due to the fraud or other prohibited activity.

15  For purposes of this sub-subparagraph, "conviction" means a

16  determination of guilt that is the result of a plea or trial,

17  regardless of whether adjudication is withheld.

18         2.  In order for the officer, spouse, and dependent

19  children to be eligible for such insurance coverage, the

20  injury must have occurred as the result of the officer's

21  response to fresh pursuit, the officer's response to what is

22  reasonably believed to be an emergency, or an unlawful act

23  perpetrated by another.  Except as otherwise provided herein,

24  nothing in this paragraph shall be construed to limit health

25  insurance coverage for which the officer, spouse, or dependent

26  children may otherwise be eligible, except that a person who

27  qualifies under this section shall not be eligible for the

28  health insurance subsidy provided under part I of chapter 121,

29  chapter 175, or chapter 185.

30         Section 15.  Paragraph (g) of subsection (2) of section

31  112.191, Florida Statutes, is amended to read:

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  1         112.191  Firefighters; death benefits.--

  2         (2)

  3         (g)1.  Any employer who employs a full-time firefighter

  4  who, on or after January 1, 1995, suffers a catastrophic

  5  injury, as defined in s. 440.02(37), in the line of duty shall

  6  pay the entire premium of the employer's health insurance plan

  7  for the injured employee, the injured employee's spouse, and

  8  for each dependent child of the injured employee until the

  9  child reaches the age of majority or until the end of the

10  calendar year in which the child reaches the age of 25 if the

11  child continues to be dependent for support, or the child is a

12  full-time or part-time student and is dependent for support.

13  The term "health insurance plan" does not include supplemental

14  benefits that are not part of the basic group health insurance

15  plan.  If the injured employee subsequently dies, the employer

16  shall continue to pay the entire health insurance premium for

17  the surviving spouse until remarried, and for the dependent

18  children, under the conditions outlined in this paragraph.

19  However:

20         a.  Health insurance benefits payable from any other

21  source shall reduce benefits payable under this section.

22         b.  It is unlawful for a person to willfully and

23  knowingly make, or cause to be made, or to assist, conspire

24  with, or urge another to make, or cause to be made, any false,

25  fraudulent, or misleading oral or written statement to obtain

26  health insurance coverage as provided under this paragraph.  A

27  person who violates this sub-subparagraph commits a

28  misdemeanor of the first degree, punishable as provided in s.

29  775.082 or s. 775.083.

30         c.  In addition to any applicable criminal penalty,

31  upon conviction for a violation as described in

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  1  sub-subparagraph b., a firefighter or other beneficiary who

  2  receives or seeks to receive health insurance benefits under

  3  this paragraph shall forfeit the right to receive such health

  4  insurance benefits, and shall reimburse the employer for all

  5  benefits paid due to the fraud or other prohibited activity.

  6  For purposes of this sub-subparagraph, "conviction" means a

  7  determination of guilt that is the result of a plea or trial,

  8  regardless of whether adjudication is withheld.

  9         2.  In order for the firefighter, spouse, and dependent

10  children to be eligible for such insurance coverage, the

11  injury must have occurred as the result of the firefighter's

12  response to what is reasonably believed to be an emergency

13  involving the protection of life or property, or an unlawful

14  act perpetrated by another.  Except as otherwise provided

15  herein, nothing in this paragraph shall be construed to limit

16  health insurance coverage for which the firefighter, spouse,

17  or dependent children may otherwise be eligible, except that a

18  person who qualifies for benefits under this section shall not

19  be eligible for the health insurance subsidy provided under

20  part I of chapter 121, chapter 175, or chapter 185.

21

22  Notwithstanding any provision of this section to the contrary,

23  the death benefits provided in paragraphs (b), (c), and (f)

24  shall also be applicable and paid in cases where a firefighter

25  received bodily injury prior to July 1, 1993, and subsequently

26  died on or after July 1, 1993, as a result of such

27  in-line-of-duty injury.

28         Section 16.  Paragraph (a) of subsection (9) of section

29  112.313, Florida Statutes, is amended to read:

30         112.313  Standards of conduct for public officers,

31  employees of agencies, and local government attorneys.--

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  1         (9)  POSTEMPLOYMENT RESTRICTIONS; STANDARDS OF CONDUCT

  2  FOR LEGISLATORS AND LEGISLATIVE EMPLOYEES.--

  3         (a)1.  It is the intent of the Legislature to implement

  4  by statute the provisions of s. 8(e), Art. II of the State

  5  Constitution relating to legislators, statewide elected

  6  officers, appointed state officers, and designated public

  7  employees.

  8         2.  As used in this paragraph:

  9         a.  "Employee" means:

10         (I)  Any person employed in the executive or

11  legislative branch of government holding a position in the

12  Senior Management Service as defined in s. 110.402 or any

13  person holding a position in the Selected Exempt Service as

14  defined in s. 110.602 or any person having authority over

15  policy or procurement employed by the Department of the

16  Lottery.

17         (II)  The Auditor General, the Sergeant at Arms and

18  Secretary of the Senate, and the Sergeant at Arms and Clerk of

19  the House of Representatives.

20         (III)  The executive director of the Legislative

21  Committee on Intergovernmental Relations and the executive

22  director and deputy executive director of the Commission on

23  Ethics.

24         (IV)  An executive director, staff director, or deputy

25  staff director of each joint committee, standing committee, or

26  select committee of the Legislature; an executive director,

27  staff director, executive assistant, analyst, or attorney of

28  the Office of the President of the Senate, the Office of the

29  Speaker of the House of Representatives, the Senate Majority

30  Party Office, Senate Minority Party Office, House Majority

31  Party Office, or House Minority Party Office; or any person,

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  1  hired on a contractual basis, having the power normally

  2  conferred upon such persons, by whatever title.

  3         (V)  The Chancellor and Vice Chancellors of the State

  4  University System; the general counsel to the Board of

  5  Regents; and the president, vice presidents, and deans of each

  6  state university.

  7         (VI)  Any person having the power normally conferred

  8  upon the positions referenced in this sub-subparagraph.

  9         b.  "Appointed state officer" means any member of an

10  appointive board, commission, committee, council, or authority

11  of the executive or legislative branch of state government

12  whose powers, jurisdiction, and authority are not solely

13  advisory and include the final determination or adjudication

14  of any personal or property rights, duties, or obligations,

15  other than those relative to its internal operations.

16         c.  "State agency" means an entity of the legislative,

17  executive, or judicial branch of state government over which

18  the Legislature exercises plenary budgetary and statutory

19  control.

20         3.  No member of the Legislature, appointed state

21  officer, or statewide elected officer shall personally

22  represent another person or entity for compensation before the

23  government body or agency of which the individual was an

24  officer or member for a period of 2 years following vacation

25  of office. No member of the Legislature shall personally

26  represent another person or entity for compensation during his

27  or her term of office before any state agency other than

28  judicial tribunals or in settlement negotiations after the

29  filing of a lawsuit.

30         4.  No agency employee shall personally represent

31  another person or entity for compensation before the agency

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  1  with which he or she was employed for a period of 2 years

  2  following vacation of position, unless employed by another

  3  agency of state government.

  4         5.  Any person violating this paragraph shall be

  5  subject to the penalties provided in s. 112.317 and a civil

  6  penalty of an amount equal to the compensation which the

  7  person receives for the prohibited conduct.

  8         6.  This paragraph is not applicable to:

  9         a.  A person employed by the Legislature or other

10  agency prior to July 1, 1989;

11         b.  A person who was employed by the Legislature or

12  other agency on July 1, 1989, whether or not the person was a

13  defined employee on July 1, 1989;

14         c.  A person who was a defined employee of the State

15  University System or the Public Service Commission who held

16  such employment on December 31, 1994;

17         d.  A person who has reached normal retirement age as

18  defined in s. 121.021(29), and who has retired under the

19  provisions of part I of chapter 121 by July 1, 1991; or

20         e.  Any appointed state officer whose term of office

21  began before January 1, 1995, unless reappointed to that

22  office on or after January 1, 1995.

23         Section 17.  Paragraph (e) of subsection (1) of section

24  112.665, Florida Statutes, is amended to read:

25         112.665  Duties of Department of Management Services.--

26         (1)  The Department of Management Services shall:

27         (e)  Issue, by January 1 annually, a report to the

28  Special District Information Program of the Department of

29  Community Affairs that includes the participation in and

30  compliance of special districts with the local government

31  retirement system provisions in s. 112.63 and the

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  1  state-administered retirement system provisions as specified

  2  in part I of chapter 121; and

  3         Section 18.  Subsection (5) of section 154.10, Florida

  4  Statutes, is amended to read:

  5         154.10  Relationship with board of county

  6  commissioners.--At such time as the governing body of a county

  7  shall declare the need for a public health trust to function

  8  in such county, appoint a board of trustees, and designate

  9  health care facilities pursuant to the provisions of this

10  part, said governing body shall be authorized to transfer to

11  the public health trust any or all of the ownership,

12  operation, governance, or maintenance of such designated

13  facilities.  The county governing body shall, by ordinance, by

14  contract or lease with the public health trust, or by a

15  combination of the foregoing, provide for each of the

16  following:

17         (5)  The preservation and continuation of the benefits

18  of county employees who became employees of the public health

19  trust, including, but not limited to, participation by such

20  employees in the State and County Officers and Employees'

21  Retirement System and the Florida Retirement System.  The

22  trust may provide social security for its employees pursuant

23  to the provisions of chapter 650 and may bring its employees

24  under the provisions of the Florida Retirement System as

25  authorized by part I of chapter 121.

26         Section 19.  Subsection (1) of section 154.12, Florida

27  Statutes, is amended to read:

28         154.12  Legal status of public health trusts.--

29         (1)  Employees of a public health trust created

30  pursuant to this part shall be considered to come within the

31  terms of chapter 122 for purposes of inclusion in the State

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  1  and County Officers and Employees' Retirement System and

  2  within the terms of part I of chapter 121, for purposes of

  3  inclusion in the Florida Retirement System.

  4         Section 20.  Section 175.361, Florida Statutes, is

  5  amended to read:

  6         175.361  Termination of plan and distribution of

  7  fund.--For any municipality, special fire control district,

  8  chapter plan, local law municipality, local law special fire

  9  control district, or local law plan under this chapter, the

10  plan may be terminated by the municipality or special fire

11  control district.  Upon termination of the plan by the

12  municipality or special fire control district for any reason

13  or because of a transfer, merger, or consolidation of

14  governmental units, services, or functions as provided in part

15  I of chapter 121, or upon written notice by the municipality

16  or special fire control district to the board of trustees that

17  contributions under the plan are being permanently

18  discontinued, the rights of all employees to benefits accrued

19  to the date of such termination and the amounts credited to

20  the employees' accounts are nonforfeitable. The fund shall be

21  apportioned and distributed in accordance with the following

22  procedures:

23         (1)  The board of trustees shall determine the date of

24  distribution and the asset value to be distributed, after

25  taking into account the expenses of such distribution.

26         (2)  The board of trustees shall determine the method

27  of distribution of the asset value, that is, whether

28  distribution shall be by payment in cash, by the maintenance

29  of another or substituted trust fund, by the purchase of

30  insured annuities, or otherwise, for each firefighter entitled

31  to benefits under the plan as specified in subsection (3).

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  1         (3)  The board of trustees shall apportion the asset

  2  value as of the date of termination in the manner set forth in

  3  this subsection, on the basis that the amount required to

  4  provide any given retirement income shall mean the actuarially

  5  computed single-sum value of such retirement income, except

  6  that if the method of distribution determined under subsection

  7  (2) involves the purchase of an insured annuity, the amount

  8  required to provide the given retirement income shall mean the

  9  single premium payable for such annuity.

10         (a)  Apportionment shall first be made in respect of

11  each retired firefighter receiving a retirement income

12  hereunder on such date, each person receiving a retirement

13  income on such date on account of a retired (but since

14  deceased) firefighter, and each firefighter who has, by such

15  date, become eligible for normal retirement but has not yet

16  retired, in the amount required to provide such retirement

17  income, provided that, if such asset value is less than the

18  aggregate of such amounts, such amounts shall be

19  proportionately reduced so that the aggregate of such reduced

20  amounts will be equal to such asset value.

21         (b)  If there is any asset value remaining after the

22  apportionment under paragraph (a), apportionment shall next be

23  made in respect of each firefighter in the service of the

24  municipality or special fire control district on such date who

25  has completed at least 10 years of credited service, in the

26  firefighters' pension trust fund for at least 10 years, and

27  who is not entitled to an apportionment under paragraph (a),

28  in the amount required to provide the actuarial equivalent of

29  the accrued normal retirement income, based on the

30  firefighter's credited service and earnings to such date, and

31  each former participant then entitled to a benefit under the

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  1  provisions of s. 175.211 who has not by such date reached his

  2  or her normal retirement date, in the amount required to

  3  provide the actuarial equivalent of the accrued normal

  4  retirement income to which he or she is entitled under s.

  5  175.211; provided that, if such remaining asset value is less

  6  than the aggregate of the amounts apportioned hereunder, such

  7  latter amounts shall be proportionately reduced so that the

  8  aggregate of such reduced amounts will be equal to such

  9  remaining asset value.

10         (c)  If there is any asset value after the

11  apportionments under paragraphs (a) and (b), apportionment

12  shall lastly be made in respect of each firefighter in the

13  service of the municipality or special fire control district

14  on such date who is not entitled to an apportionment under

15  paragraphs (a) and (b) in the amount equal to the

16  firefighter's total contributions to the plan to date of

17  termination; provided that, if such remaining asset value is

18  less than the aggregate of the amounts apportioned hereunder,

19  such latter amounts shall be proportionately reduced so that

20  the aggregate of such reduced amounts will be equal to such

21  remaining asset value.

22         (d)  In the event that there is asset value remaining

23  after the full apportionment specified in paragraphs (a), (b),

24  and (c), such excess shall be returned to the municipality or

25  special fire control district, less return to the state of the

26  state's contributions, provided that, if the excess is less

27  than the total contributions made by the municipality or

28  special fire control district and the state to date of

29  termination of the plan, such excess shall be divided

30  proportionately to the total contributions made by the

31  municipality or special fire control district and the state.

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  1         (4)  The board of trustees shall distribute, in

  2  accordance with the manner of distribution determined under

  3  subsection (2), the amounts apportioned under subsection (3).

  4

  5  If, after a period of 24 months after the date on which the

  6  plan terminated or the date on which the board received

  7  written notice that the contributions thereunder were being

  8  permanently discontinued, the municipality or special fire

  9  control district or the board of trustees of the firefighters'

10  pension trust fund affected has not complied with all the

11  provisions in this section, the division shall effect the

12  termination of the fund in accordance with this section.

13         Section 21.  Section 185.37, Florida Statutes, is

14  amended to read:

15         185.37  Termination of plan and distribution of

16  fund.--For any municipality, chapter plan, local law

17  municipality, or local law plan under this chapter, the plan

18  may be terminated by the municipality. Upon termination of the

19  plan by the municipality for any reason, or because of a

20  transfer, merger, or consolidation of governmental units,

21  services, or functions as provided in part I of chapter 121,

22  or upon written notice to the board of trustees by the

23  municipality that contributions under the plan are being

24  permanently discontinued, the rights of all employees to

25  benefits accrued to the date of such termination or

26  discontinuance and the amounts credited to the employees'

27  accounts are nonforfeitable. The fund shall be apportioned and

28  distributed in accordance with the following procedures:

29         (1)  The board of trustees shall determine the date of

30  distribution and the asset value to be distributed, after

31  taking into account the expenses of such distribution.

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  1         (2)  The board of trustees shall determine the method

  2  of distribution of the asset value, that is, whether

  3  distribution shall be by payment in cash, by the maintenance

  4  of another or substituted trust fund, by the purchase of

  5  insured annuities, or otherwise, for each police officer

  6  entitled to benefits under the plan, as specified in

  7  subsection (3).

  8         (3)  The board of trustees shall apportion the asset

  9  value as of the date of termination in the manner set forth in

10  this subsection, on the basis that the amount required to

11  provide any given retirement income shall mean the actuarially

12  computed single-sum value of such retirement income, except

13  that if the method of distribution determined under subsection

14  (2) involves the purchase of an insured annuity, the amount

15  required to provide the given retirement income shall mean the

16  single premium payable for such annuity.

17         (a)  Apportionment shall first be made in respect of

18  each retired police officer receiving a retirement income

19  hereunder on such date, each person receiving a retirement

20  income on such date on account of a retired (but since

21  deceased) police officer, and each police officer who has, by

22  such date, become eligible for normal retirement but has not

23  yet retired, in the amount required to provide such retirement

24  income, provided that, if such asset value is less than the

25  aggregate of such amounts, such amounts shall be

26  proportionately reduced so that the aggregate of such reduced

27  amounts will be equal to such asset value.

28         (b)  If there is any asset value remaining after the

29  apportionment under paragraph (a), apportionment shall next be

30  made in respect of each police officer in the service of the

31  municipality on such date who has completed at least 10 years

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  1  of credited service, in the municipal police officers'

  2  retirement trust fund for at least 10 years, and who is not

  3  entitled to an apportionment under paragraph (a), in the

  4  amount required to provide the actuarial equivalent of the

  5  accrued normal retirement income, based on the police

  6  officer's credited service and earnings to such date, and each

  7  former participant then entitled to a benefit under the

  8  provisions of s. 185.19 who has not by such date reached his

  9  or her normal retirement date, in the amount required to

10  provide the actuarial equivalent of the accrued normal

11  retirement income to which he or she is entitled under s.

12  185.19, provided that, if such remaining asset value is less

13  than the aggregate of the amounts apportioned hereunder, such

14  latter amounts shall be proportionately reduced so that the

15  aggregate of such reduced amounts will be equal to such

16  remaining asset value.

17         (c)  If there is an asset value after the

18  apportionments under paragraphs (a) and (b), apportionment

19  shall lastly be made in respect of each police officer in the

20  service of the municipality on such date who is not entitled

21  to an apportionment under paragraphs (a) and (b) in the amount

22  equal to the police officer's total contributions to the plan

23  to date of termination, provided that, if such remaining asset

24  value is less than the aggregate of the amounts apportioned

25  hereunder, such latter amounts shall be proportionately

26  reduced so that the aggregate of such reduced amounts will be

27  equal to such remaining asset value.

28         (d)  In the event that there is asset value remaining

29  after the full apportionment specified in paragraphs (a), (b),

30  and (c), such excess shall be returned to the municipality,

31  less return to the state of the state's contributions,

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  1  provided that, if the excess is less than the total

  2  contributions made by the municipality and the state to date

  3  of termination of the plan, such excess shall be divided

  4  proportionately to the total contributions made by the

  5  municipality and the state.

  6         (4)  The board of trustees shall distribute, in

  7  accordance with the manner of distribution determined under

  8  subsection (2), the amounts apportioned under subsection (3).

  9

10  If, after a period of 24 months after the date on which the

11  plan terminated or the date on which the board received

12  written notice that the contributions thereunder were being

13  permanently discontinued, the municipality or the board of

14  trustees of the municipal police officers' retirement trust

15  fund affected has not complied with all the provisions in this

16  section, the division shall effect the termination of the fund

17  in accordance with this section.

18         Section 22.  Subsection (1) of section 189.412, Florida

19  Statutes, is amended to read:

20         189.412  Special District Information Program; duties

21  and responsibilities.--The Special District Information

22  Program of the Department of Community Affairs is created and

23  has the following special duties:

24         (1)  The collection and maintenance of special district

25  compliance status reports from the Auditor General, the

26  Department of Banking and Finance, the Division of Bond

27  Finance of the State Board of Administration, the Department

28  of Management Services, the Department of Revenue, and the

29  Commission on Ethics for the reporting required in ss. 11.45,

30  112.3144, 112.3145, 112.3148, 112.3149, 112.63, 200.068,

31  218.32, 218.34, 218.38, and 280.17 and part I of chapter 121

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  1  and from state agencies administering programs that distribute

  2  money to special districts. The special district compliance

  3  status reports must consist of a list of special districts

  4  used in that state agency and a list of which special

  5  districts did not comply with the reporting statutorily

  6  required by that agency.

  7         Section 23.  Subsection (2) of section 216.262, Florida

  8  Statutes, is amended to read:

  9         216.262  Authorized positions.--

10         (2)  The provisions of paragraphs (1)(d) and (e) do not

11  apply to an individual filling a position the salary of which

12  has been specifically fixed or limited by law.  Unless

13  specifically authorized by law, an individual filling or

14  performing the duties of a position the salary of which has

15  been specifically fixed or limited by law may not receive

16  compensation from more than one appropriation, or in excess of

17  the amount so fixed or limited by law, regardless of any

18  additional duties performed by that individual in any capacity

19  or position. However, this subsection does not prohibit

20  additional compensation from an educational appropriation to

21  any person holding a position the salary of which is

22  specifically fixed or limited by law, provided such

23  compensation does not exceed payment for more than one course

24  of instruction during any one academic term and that such

25  compensation is approved as provided in paragraphs (1)(d) and

26  (e).  Any compensation received by any person pursuant to the

27  provisions of this subsection shall not be computed as a part

28  of average final compensation for retirement purposes under

29  the provisions of part I of chapter 121.

30         Section 24.  Subsection (8) of section 231.36, Florida

31  Statutes, is amended to read:

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  1         231.36  Contracts with instructional staff,

  2  supervisors, and principals.--

  3         (8)  Notwithstanding any other provision of law, any

  4  member who has retired may interrupt retirement and be

  5  reemployed in any public school. Any member so reemployed by

  6  the same district from which he or she retired may be employed

  7  on a probationary contractual basis as provided in subsection

  8  (1); however, no regular retirement employee shall be eligible

  9  to renew membership under a retirement system created by part

10  I of chapter 121 or chapter 238.

11         Section 25.  Section 238.072, Florida Statutes, is

12  amended to read:

13         238.072  Special service provisions for extension

14  personnel.--All state and county cooperative extension

15  personnel holding appointments by the United States Department

16  of Agriculture for extension work in agriculture and home

17  economics in this state who are joint representatives of the

18  University of Florida and the United States Department of

19  Agriculture, as provided in s. 121.051(7), who are members of

20  the Teachers' Retirement System, chapter 238, and who are

21  prohibited from transferring to and participating in the

22  Florida Retirement System, part I of chapter 121, may retire

23  with full benefits upon completion of 30 years of creditable

24  service and shall be considered to have attained normal

25  retirement age under this chapter, any law to the contrary

26  notwithstanding. In order to comply with the provisions of s.

27  14, Art. X of the State Constitution, any liability accruing

28  to the Florida Retirement System Trust Fund as a result of the

29  provisions of this section shall be paid on an annual basis

30  from the General Revenue Fund.

31

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  1         Section 26.  Paragraph (a) of subsection (3) of section

  2  238.171, Florida Statutes, is amended to read:

  3         238.171  Monthly allowance; when made.--

  4         (3)(a)  On July 1, 1974, the director of the Division

  5  of Retirement shall adjust the monthly allowance provided for

  6  incapacitated teachers under this section by increasing said

  7  allowance by a percentage which shall be equal to the

  8  percentage change in the average cost-of-living index, as

  9  defined in part I of chapter 121, over the period between

10  April 1, 1967, and March 31, 1973. The percent of increase, as

11  of July 1, 1974, shall be 25.4 percent, which is the average

12  cost-of-living increase percentage from April 1, 1967, through

13  March 31, 1973.

14         Section 27.  Subsection (1) of section 238.175, Florida

15  Statutes, is amended to read:

16         238.175  Members with prior service in federally

17  operated state schools; eligibility for special credits.--

18         (1)  Any member of the Teachers' Retirement System or

19  the Florida Retirement System established respectively by this

20  chapter and part I of chapter 121 who taught in a public

21  school in Florida which was taken over and operated by the

22  United States Government pursuant to Pub. L. No. 81-874 or

23  other Federal Law, may claim and receive credit in the

24  retirement system in which he or she is participating for the

25  time he or she taught in such schools, while they were

26  operated by the United States Government under the following

27  conditions, provided credit for such teaching time has not

28  been granted in any other state or federal retirement system.

29         (a)  If the member was a member of the Teachers'

30  Retirement System prior to the time he or she began teaching

31  in the public schools operated by the United States

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  1  Government, he or she may claim and receive credit for such

  2  teaching time in the retirement system in which he or she is

  3  participating as prior service upon the payment of the amounts

  4  required to obtain credit for such prior service pursuant to

  5  the laws and rules governing the administration of his or her

  6  retirement system.

  7         (b)  If the member was not a member of the Teachers'

  8  Retirement System prior to the time he or she began teaching

  9  in the public schools operated by the United States

10  Government, he or she may claim and receive retirement credit

11  for such teaching time in the following manner:

12         1.  A member of the Teachers' Retirement System may

13  receive retirement credit for the time he or she taught in

14  such federally operated schools as prior teaching service

15  outside the state pursuant to the provisions of s. 238.06(4).

16         2.  A member of the Florida Retirement System may

17  receive retirement credit for the time he or she taught in

18  such federally operated schools as past service pursuant to

19  the provisions of, and following the payment of the amounts

20  specified in, s. 121.081(1), notwithstanding any contrary

21  provisions in said s. 121.021(18), or other provisions of law.

22         Section 28.  Paragraph (i) of subsection (3) of section

23  240.3195, Florida Statutes, is amended to read:

24         240.3195  State Community College System Optional

25  Retirement Program.--Each community college may implement an

26  optional retirement program, if such program is established

27  therefor pursuant to s. 240.319(4)(r), under which annuity

28  contracts providing retirement and death benefits may be

29  purchased by, and on behalf of, eligible employees who

30  participate in the program. Except as otherwise provided

31  herein, this retirement program, which shall be known as the

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  1  State Community College System Optional Retirement Program,

  2  may be implemented and administered only by an individual

  3  community college or by a consortium of community colleges.

  4         (3)

  5         (i)  Except as provided in s. 121.052(6)(d), a program

  6  participant who is or who becomes dually employed in two or

  7  more positions covered by the Florida Retirement System, one

  8  of which is eligible for an optional retirement program

  9  pursuant to this section and one of which is not, is subject

10  to the dual employment provisions of part I of chapter 121.

11         Section 29.  Subsection (5) of section 650.05, Florida

12  Statutes, is amended to read:

13         650.05  Plans for coverage of employees of political

14  subdivisions.--

15         (5)  Each political subdivision as to which a plan has

16  been approved shall be liable to the state agency for a

17  proportionate part of the cost of administering this chapter.

18  Such proportionate cost shall be computed and paid in

19  accordance with such regulations relating thereto as may be

20  adopted by the state agency and shall be deposited in the

21  Social Security Administration Trust Fund; and, if any such

22  payment is not made when due, the amount thereof, with

23  interest of 0.5 percent for each calendar month or part

24  thereof past the due date, shall, upon request of the state

25  agency, be deducted from any other moneys payable to such

26  political subdivision by any officer, department, or agency of

27  the state, and forthwith paid to the state agency.

28  Withdrawals from the Social Security Administration Trust Fund

29  shall be made solely for the payment of costs of administering

30  this chapter, and any balance in excess of the amount

31  necessary for administering this chapter shall be transferred

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  1  to the state retirement system trust funds established

  2  pursuant to part I of chapter 121 to make up the actuarial

  3  deficit in any of the state retirement systems consolidated

  4  thereunder, and the necessary amounts are hereby appropriated

  5  from said funds for these purposes.

  6         Section 30.  Effective July 1, 2001, subsections (2)

  7  and (3) of section 112.363, Florida Statutes, are amended to

  8  read:

  9         112.363  Retiree health insurance subsidy.--

10         (2)  ELIGIBILITY FOR RETIREE HEALTH INSURANCE

11  SUBSIDY.--

12         (a)  A person who is retired under a state-administered

13  retirement system, or a beneficiary who is a spouse or

14  financial dependent entitled to receive benefits under a

15  state-administered retirement system, is eligible for health

16  insurance subsidy payments provided under this section; except

17  that pension recipients under ss. 121.40, 238.07(16)(a), and

18  250.22, recipients of health insurance coverage under s.

19  110.1232, or any other special pension or relief act shall not

20  be eligible for such payments.

21         (b)  For purposes of this section, a person is deemed

22  retired from a state-administered retirement system when he or

23  she terminates employment with all employers participating in

24  the Florida Retirement System as described in s. 121.021(39)

25  and:

26         1.  For a participant of the Public Employee Optional

27  Retirement Program established under part II of chapter 121,

28  the participant meets the age or service requirements to

29  qualify for normal retirement as set forth in s. 121.021(29).

30         2.  For a member of the Florida Retirement System

31  defined benefit program, or any employee who maintains

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  1  creditable service under both the defined benefit program and

  2  the Public Employee Optional Retirement Program, the member

  3  begins drawing retirement benefits from the system.

  4         (c)1.  Effective July 1, 2001, any person retiring on

  5  or after such date as a member of the Florida Retirement

  6  System, including any participant of the defined contribution

  7  program administered pursuant to part II of chapter 121, must

  8  have satisfied the vesting requirements for his or her

  9  membership class under the Florida Retirement System defined

10  benefit program as administered under part I of chapter 121.

11         2.  Notwithstanding the provisions of subparagraph 1.,

12  a person retiring due to disability must either qualify for a

13  regular or in-line-of-duty disability benefit as provided in

14  s. 121.091(4) or qualify for a disability benefit under a

15  disability plan established under part II of chapter 121, as

16  appropriate.

17         (d)  Payment of the retiree health insurance subsidy

18  shall be made only after coverage for health insurance for the

19  retiree or beneficiary has been certified in writing to the

20  Department of Management Services. Participation in a former

21  employer's group health insurance program is not a requirement

22  for eligibility under this section.

23         (e)  However, Participants in the Senior Management

24  Service Optional Annuity Program as provided in s. 121.055(6)

25  and the State University System Optional Retirement Program as

26  provided in s. 121.35 shall not receive the retiree health

27  insurance subsidy provided in this section.  The employer of

28  such participant shall pay the contributions required in

29  subsection (8) to the annuity program provided in s.

30  121.055(6)(d) or s. 121.35(4)(a), as applicable.

31         (3)  RETIREE HEALTH INSURANCE SUBSIDY AMOUNT.--

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  1         (a)  Beginning January 1, 1988, each eligible retiree

  2  or a beneficiary who is a spouse or financial dependent

  3  thereof shall receive a monthly retiree health insurance

  4  subsidy payment equal to the number of years of creditable

  5  service, as defined in s. 121.021(17), completed at the time

  6  of retirement multiplied by $1; however, no retiree may

  7  receive a subsidy payment of more than $30 or less than $10.

  8         (b)  Beginning January 1, 1989, each eligible retiree

  9  or a beneficiary who is a spouse or financial dependent shall

10  receive a monthly retiree health insurance subsidy payment

11  equal to the number of years of creditable service, as defined

12  in s. 121.021(17), completed at the time of retirement

13  multiplied by $2; however, no retiree may receive a subsidy

14  payment of more than $60 or less than $20.

15         (c)  Beginning January 1, 1991, each eligible retiree

16  or a beneficiary who is a spouse or financial dependent shall

17  receive a monthly retiree health insurance subsidy payment

18  equal to the number of years of creditable service, as defined

19  in s. 121.021(17), completed at the time of retirement

20  multiplied by $3; however, no retiree may receive a subsidy

21  payment of more than $90 or less than $30.

22         (d)  Beginning January 1, 1999, each eligible retiree

23  or, if the retiree is deceased, his or her beneficiary who is

24  receiving a monthly benefit from such retiree's account and

25  who is a spouse, or a person who meets the definition of joint

26  annuitant in s. 121.021(28), shall receive a monthly retiree

27  health insurance subsidy payment equal to the number of years

28  of creditable service, as defined in s. 121.021(17), completed

29  at the time of retirement multiplied by $5; however, no

30  eligible retiree or such beneficiary may receive a subsidy

31  payment of more than $150 or less than $50.  If there are

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  1  multiple beneficiaries, the total payment must not be greater

  2  than the payment to which the retiree was entitled.

  3         (e)1.  Beginning July 1, 2001, each eligible retiree of

  4  the defined benefit program of the Florida Retirement System,

  5  or, if the retiree is deceased, his or her beneficiary who is

  6  receiving a monthly benefit from such retiree's account and

  7  who is a spouse, or a person who meets the definition of joint

  8  annuitant in s. 121.021(28), shall receive a monthly retiree

  9  health insurance subsidy payment equal to the number of years

10  of creditable service, as defined in s. 121.021(17), completed

11  at the time of retirement multiplied by $5; however, no

12  eligible retiree or beneficiary may receive a subsidy payment

13  of more than $150 or less than $40.  If there are multiple

14  beneficiaries, the total payment must not be greater than the

15  payment to which the retiree was entitled.  Notwithstanding

16  the provisions of this paragraph, the health insurance subsidy

17  amount payable to any person receiving the retiree health

18  insurance subsidy payment on July 1, 2002, shall not be

19  reduced.

20         2.  Beginning July 1, 2001, each eligible participant

21  of the Public Employee Optional Retirement Program of the

22  Florida Retirement System who has met the requirements of this

23  section, or, if the participant is deceased, his or her spouse

24  who is the participant's designated beneficiary, shall receive

25  a monthly retiree health insurance subsidy payment equal to

26  the number of years of creditable service, as provided in this

27  subparagraph, completed at the time of retirement, multiplied

28  by $5; however, no eligible retiree or beneficiary may receive

29  a subsidy payment of more than $150 or less than $40.  For

30  purposes of determining a participant's creditable service

31  used to calculate the health insurance subsidy, a

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  1  participant's years of service credit or fraction thereof

  2  shall be based on the participant's work year as defined in s.

  3  121.021(54).  Credit shall be awarded for a full work year

  4  whenever health insurance subsidy contributions have been made

  5  as required by law for each month in the participant's work

  6  year.  In addition, all years of creditable service retained

  7  under the Florida Retirement System defined benefit program

  8  shall be included as creditable service for purposes of this

  9  section.

10         Section 31.  Paragraph (b) of subsection (1) and

11  paragraph (e) of subsection (6) of section 121.055, Florida

12  Statutes, are amended to read:

13         121.055  Senior Management Service Class.--There is

14  hereby established a separate class of membership within the

15  Florida Retirement System to be known as the "Senior

16  Management Service Class," which shall become effective

17  February 1, 1987.

18         (1)

19         (b)1.  Except as provided in subparagraph 2., effective

20  January 1, 1990, participation in the Senior Management

21  Service Class shall be compulsory for the president of each

22  community college, the manager of each participating city or

23  county, and all appointed district school superintendents.

24  Effective January 1, 1994, additional positions may be

25  designated for inclusion in the Senior Management Service

26  Class of the Florida Retirement System, provided that:

27         a.  Positions to be included in the class shall be

28  designated by the local agency employer.  Notice of intent to

29  designate positions for inclusion in the class shall be

30  published once a week for 2 consecutive weeks in a newspaper

31

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  1  of general circulation published in the county or counties

  2  affected, as provided in chapter 50.

  3         b.  Up to 10 One nonelective full-time positions

  4  position may be designated for each local agency employer

  5  reporting to the Department of Management Services; for local

  6  agencies with 100 or more regularly established positions,

  7  additional nonelective full-time positions may be designated,

  8  not to exceed 1 percent of the regularly established positions

  9  within the agency.

10         c.  Each position added to the class must be a

11  managerial or policymaking position filled by an employee who

12  is not subject to continuing contract and serves at the

13  pleasure of the local agency employer without civil service

14  protection, and who:

15         (I)  Heads an organizational unit; or

16         (II)  Has responsibility to effect or recommend

17  personnel, budget, expenditure, or policy decisions in his or

18  her areas of responsibility.

19         2.  In lieu of participation in the Senior Management

20  Service Class, members of the Senior Management Service Class

21  pursuant to the provisions of subparagraph 1. may withdraw

22  from the Florida Retirement System altogether. The decision to

23  withdraw from the Florida Retirement System shall be

24  irrevocable for as long as the employee holds such a position.

25  Any service creditable under the Senior Management Service

26  Class shall be retained after the member withdraws from the

27  Florida Retirement System; however, additional service credit

28  in the Senior Management Service Class shall not be earned

29  after such withdrawal.  Such members shall not be eligible to

30  participate in the Senior Management Service Optional Annuity

31  Program.

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  1         (6)

  2         (e)  Benefits.--

  3         1.  Benefits shall be payable under the Senior

  4  Management Service Optional Annuity Program only to

  5  participants in the program, or their beneficiaries as

  6  designated by the participant in the contract with a provider

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

  8  company in accordance with the terms of the annuity contract

  9  or contracts applicable to the participant. A participant must

10  be terminated from all employment with all Florida Retirement

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

12  receiving the employer-funded benefit. Benefits funded by

13  employer contributions shall be payable only as a lifetime

14  annuity to the participant, his or her beneficiary, or his or

15  her estate, except for:

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

17  death of the participant; or

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

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

20  of 6 months from the employment that entitled him or her to

21  optional annuity program participation. A de minimis account

22  is an account with a provider company containing employer

23  contributions and accumulated earnings of not more than $5,000

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

25  be a complete liquidation of the account balance with that

26  company and is subject to the provisions of the Internal

27  Revenue Code; or

28         c.  A lump-sum direct rollover distribution whereby all

29  accrued benefits, plus interest and investment earnings, are

30  paid from the participant's account directly to the custodian

31

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  1  of an eligible retirement plan, as defined in s. 402(c)(8)(B)

  2  of the Internal Revenue Code, on behalf of the participant.

  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         Section 32.  Effective July 1, 2001, in order to fund

14  the normal cost for changes in the vesting requirements under

15  the Florida Retirement System, as provided in this act:

16         (1)  The contribution rate that applies to the Regular

17  Class of the Florida Retirement System shall be increased by

18  0.20 percentage point.

19         (2)  The contribution rate that applies to the Special

20  Risk Class of the Florida Retirement System shall be increased

21  by 0.33 percentage point.

22         (3)  The contribution rate that applies to the Special

23  Risk Administrative Support Class of the Florida Retirement

24  System shall be increased by 0.18 percentage point.

25         (4)  The contribution rate that applies to the Judicial

26  sub-class of the Elected Officers' Class of the Florida

27  Retirement System shall be increased by 0.15 percentage point.

28         (5)  The contribution rate that applies to the

29  legislative-attorney-Cabinet sub-class of the Elected

30  Officers' Class of the Florida Retirement System shall be

31  increased by 0.04 percentage point.

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  1         (6)  The contribution rate that applies to the County

  2  Officers' sub-class of the Elected Officers' Class of the

  3  Florida Retirement System shall be increased by 0.05

  4  percentage point.

  5         (7)  The contribution rate that applies to the Senior

  6  Management Service Class of the Florida Retirement System

  7  shall be increased by 0.03 percentage point.

  8

  9  These increases shall be in addition to all other changes to

10  such contribution rates which may be enacted into law to take

11  effect on that date.  The Division of Statutory Revision is

12  directed to adjust the contribution rates set forth in ss.

13  121.052, 121.055, and 121.071, Florida Statutes.

14         Section 33.  (1)  Effective July 1, 2001, in order to

15  fund the normal cost increases attributable to the 1999

16  actuarial experience study:

17         (a)  The contribution rate that applies to the Regular

18  Class of the Florida Retirement System shall be increased by

19  0.28 percentage point.

20         (b)  The contribution rate that applies to the Special

21  Risk Class of the Florida Retirement System shall be increased

22  by 1.13 percentage points.

23         (c)  The contribution rate that applies to the Special

24  Risk Administrative Support Class of the Florida Retirement

25  System shall be increased by 0.65 percentage point.

26         (d)  The contribution rate that applies to the Judicial

27  sub-class of the Elected Officers' Class of the Florida

28  Retirement System shall be increased by 0.00 percentage

29  points.

30         (e)  The contribution rate that applies to the

31  legislative-attorney-Cabinet sub-class of the Elected

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  1  Officers' Class of the Florida Retirement System shall be

  2  increased by 0.00 percentage points.

  3         (f)  The contribution rate that applies to the County

  4  Officers' sub-class of the Elected Officers' Class of the

  5  Florida Retirement System shall be increased by 0.11

  6  percentage point.

  7         (g)  The contribution rate that applies to the Senior

  8  Management Service Class of the Florida Retirement System

  9  shall be increased by 0.36 percentage point.

10

11  These increases shall be in addition to all other changes to

12  such contribution rates which may be enacted into law to take

13  effect on that date.  The Division of Statutory Revision is

14  directed to adjust the contribution rates set forth in ss.

15  121.052, 121.055, and 121.071, Florida Statutes.

16         (2)  It is the intent of the Legislature that the

17  increased costs attributable to the 1999 actuarial experience

18  study for the 2000-2001 fiscal year shall be funded by a

19  one-time recognition of a lump sum from the excess actuarial

20  assets of the Florida Retirement System Trust Fund.

21         Section 34.  Effective July 1, 2002, in order to fund

22  the changes in normal cost for the defined benefit retirement

23  program resulting from the implementation of the Public

24  Employee Optional Retirement Program, as created by this act:

25         (1)  The contribution rate that applies to the Regular

26  Class of the Florida Retirement System shall be increased by

27  0.21 percentage point.

28         (2)  The contribution rate that applies to the Special

29  Risk Class of the Florida Retirement System shall be increased

30  by 0.01 percentage point.

31

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  1         (3)  The contribution rate that applies to the Special

  2  Risk Administrative Support Class of the Florida Retirement

  3  System shall be decreased by 0.02 percentage point.

  4         (4)  The contribution rate that applies to the Judicial

  5  sub-class of the Elected Officers' Class of the Florida

  6  Retirement System shall be increased by 0.00 percentage

  7  points.

  8         (5)  The contribution rate that applies to the

  9  legislative-attorney-Cabinet sub-class of the Elected

10  Officers' Class of the Florida Retirement System shall be

11  increased by 0.07 percentage point.

12         (6)  The contribution rate that applies to the County

13  Officers' sub-class of the Elected Officers' Class of the

14  Florida Retirement System shall be increased by 0.00

15  percentage points.

16         (7)  The contribution rate that applies to the Senior

17  Management Service Class of the Florida Retirement System

18  shall be increased by 0.00 percentage points.

19

20  These increases shall be in addition to all other changes to

21  such contribution rates which may be enacted into law to take

22  effect on that date.  The Division of Statutory Revision is

23  directed to adjust the contribution rates set forth in ss.

24  121.052, 121.055, and 121.071, Florida Statutes.

25         Section 35.  (1)  Effective July 1, 2000, for fiscal

26  years 2000-2001 and 2001-2002, the contribution rates for the

27  Regular Class, Special Risk Class, Special Risk Administrative

28  Support Class, each sub-class of the Elected Officers' Class,

29  and the Senior Management Service Class each shall be reduced

30  by 0.1 percentage point. These reductions shall be in addition

31

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  1  to all other changes to such contribution rates which may be

  2  enacted into law to take effect on that date.

  3         (2)(a)  For fiscal years 2000-2001 and 2001-2002, each

  4  employer participating in the Florida Retirement System

  5  administered pursuant to chapter 121, Florida Statutes, shall

  6  pay an additional contribution to the Division of Retirement

  7  equal to 0.1 percent of each member's gross compensation for

  8  deposit in the division's Operating Trust Fund.  The

  9  contributions shall be made for each pay period and are in

10  addition to all contributions required for the Florida

11  Retirement System, social security, and the Retiree Health

12  Insurance Subsidy Trust Fund.

13         (b)  Such contributions shall be transferred

14  immediately from the division's Operating Trust Fund to the

15  State Board of Administration's Administrative Expense Trust

16  Fund to offset the costs of implementing the Public Employee

17  Optional Retirement Program as created by this act.  Such

18  funds are appropriated to the State Board of Administration to

19  offset reasonable expenses incurred by the board and the

20  Public Employee Optional Retirement Program Advisory Council.

21  The board may transfer such funds as are necessary to the

22  Division of Retirement in order to carry out the provisions of

23  this act.

24         (3)  There are hereby authorized 20 FTEs in the State

25  Board of Administration for the trustees to establish a

26  separate staff to implement the Public Employee Optional

27  Retirement Program.

28         Section 36.  The Legislature finds that a proper and

29  legitimate state purpose is served when employees and retirees

30  of the state and of its political subdivisions, and the

31  dependents, survivors, and beneficiaries of such employees and

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  1  retirees, are extended the basic protections afforded by

  2  governmental retirement systems that provide fair and adequate

  3  benefits that are managed, administered, and funded in an

  4  actuarially sound manner, as required by s. 14, Art. X of the

  5  State Constitution and part VII of chapter 112, Florida

  6  Statutes. Therefore, the Legislature determines and declares

  7  that this act fulfills an important state interest.

  8         Section 37.  Except as otherwise provided herein, this

  9  act shall take effect July 1, 2000, and the Public Employee

10  Optional Retirement Program created by this act shall be

11  contingent upon:

12         1.  The Department of Management Services receiving a

13  favorable determination letter and a favorable private-letter

14  ruling from the Internal Revenue Service by May 1, 2002.

15         2.  The State Board of Administration having selected

16  and contracted with the third-party administrator.

17         3.  The third-party administrator having successfully

18  established data links with the employers participating in the

19  Florida Retirement System.

20         4.  The education component of the Public Employee

21  Optional Retirement Program having been available for at least

22  90 days.

23         5.  A diversified portfolio of financial instruments

24  having become available to participants of the Public Employee

25  Optional Retirement Program.

26

27            *****************************************

28                          HOUSE SUMMARY

29
      Directs the State Board of Administration to establish an
30    optional defined contribution retirement program for
      members of the Florida Retirement System. See bill for
31    details.

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