Senate Bill sb0376

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    Florida Senate - 2001                                   SB 376

    By Senator Miller





    21-301-01

  1                      A bill to be entitled

  2         An act relating to retirement; amending s.

  3         121.091, F.S.; revising the method of

  4         calculating the monthly benefit for members of

  5         the Regular Class of the Florida Retirement

  6         System; providing for contribution rate

  7         increases to fund this act; requesting the

  8         Division of Statutory Revision to adjust

  9         contribution rates set forth in s. 121.071,

10         F.S.; declaring that this act fulfills an

11         important state interest; providing an

12         effective date.

13

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

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

17  Statutes, is amended to read:

18         121.091  Benefits payable under the system.--Benefits

19  may not be paid under this section unless the member has

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

21  begun participation in the Deferred Retirement Option Program

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

23  been filed in the manner prescribed by the department. The

24  department may cancel an application for retirement benefits

25  when the member or beneficiary fails to timely provide the

26  information and documents required by this chapter and the

27  department's rules. The department shall adopt rules

28  establishing procedures for application for retirement

29  benefits and for the cancellation of such application when the

30  required information or documents are not received.

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    Florida Senate - 2001                                   SB 376
    21-301-01




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

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

  3  the administrator, shall receive a monthly benefit which shall

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

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

  6  thereafter during his or her lifetime. The normal retirement

  7  benefit, including any past or additional retirement credit,

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

  9  The amount of monthly benefit shall be calculated as the

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

11  applicable, as set forth below:

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

13  is 1.68 1.60 percent of the member's average final

14  compensation, up to the member's normal retirement date. Upon

15  completion of the first year after the normal retirement date,

16  A is 1.63 percent of the member's average final compensation.

17  Following the second year after the normal retirement date, A

18  is 1.65 percent of the member's average final compensation.

19  Following the third year after the normal retirement date, and

20  for subsequent years, A is 1.68 percent of the member's

21  average final compensation.

22         2.  For creditable years of special risk service, A is:

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

24  compensation for all creditable years prior to October 1,

25  1974;

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

27  compensation for all creditable years after September 30,

28  1974, and before October 1, 1978;

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

30  compensation for all creditable years after September 30,

31  1978, and before January 1, 1989;

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    Florida Senate - 2001                                   SB 376
    21-301-01




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

  2  monthly compensation for all creditable years after December

  3  31, 1988, and before January 1, 1990;

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

  5  final compensation for all creditable years after December 31,

  6  1989, and before January 1, 1991;

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

  8  final compensation for all creditable years after December 31,

  9  1990, and before January 1, 1992;

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

11  average final compensation for all creditable years after

12  December 31, 1991, and before January 1, 1993;

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

14  compensation for all creditable years after December 31, 1992;

15  and

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

17  compensation for all creditable years of service after

18  September 30, 1978, and before January 1, 1993, for any

19  special risk member who retires after July 1, 2000, or any

20  member of the Special Risk Administrative Support Class

21  entitled to retain the special risk normal retirement date who

22  was a member of the Special Risk Class during the time period

23  and who retires after July 1, 2000.

24         3.  For creditable years of Senior Management Service

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

26         4.  For creditable years of Elected Officers' Class

27  service as a Supreme Court Justice, district court of appeal

28  judge, circuit judge, or county court judge, A is 3 1/3

29  percent of the member's average final compensation, and for

30  all other creditable service in such class, A is 3 percent of

31  average final compensation;

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    Florida Senate - 2001                                   SB 376
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  1         (b)  B is the number of the member's years and any

  2  fractional part of a year of creditable service earned

  3  subsequent to November 30, 1970; and

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

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

  6  existing system.  Such normal retirement benefit credit shall

  7  be determined as the product of X and Y when X is the

  8  percentage of average final compensation which the member

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

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

11  in accordance with the existing system under which the member

12  is covered on November 30, 1970, and Y is average final

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

14  member of an existing retirement system who is eligible to

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

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

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

18  service.

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

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

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

22         Section 2.  Effective July 1, 2001, in order to fund

23  the benefits provided under section 1 of this act, the

24  contribution rate that applies to the Regular Class of the

25  Florida Retirement System shall be increased by _____

26  percentage points. This increase is in addition to all other

27  changes to such contribution rate which may be enacted into

28  law to take effect on that date. The Division of Statutory

29  Revision is requested to adjust accordingly the contribution

30  rates set forth in section 121.071, Florida Statutes.

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    Florida Senate - 2001                                   SB 376
    21-301-01




  1         Section 3.  The Legislature finds that a proper and

  2  legitimate state purpose is served when employees and retirees

  3  of the state and of its political subdivisions, and the

  4  dependents, survivors, and beneficiaries of such employees and

  5  retirees, are extended the basic protections afforded by

  6  governmental retirement systems that provide fair and adequate

  7  benefits that are managed, administered, and funded in an

  8  actuarially sound manner, as required by Section 14, Article X

  9  of the State Constitution and part VII of chapter 112, Florida

10  Statutes. Therefore, the Legislature determines and declares

11  that this act fulfills an important state interest.

12         Section 4.  This act shall take effect July 1, 2001.

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14            *****************************************

15                          SENATE SUMMARY

16    Increases the retirement benefit for members of the
      Regular Class of the Florida Retirement System by
17    providing for 1.68 percent of average final compensation
      to be paid for each year of creditable service.
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