HB 1575 2003
   
1 A bill to be entitled
2          An act relating to agency reorganization; transferring the
3    Division of Retirement and its powers, duties, functions,
4    components, and assets from the Department of Management
5    Services to the State Board of Administration; amending s.
6    110.205, F.S.; providing status of division personnel
7    under the Career Service System; amending ss. 20.22,
8    20.28, 112.05, 112.3173, 112.352, 112.354, 112.356,
9    112.358, 112.361, 112.362, 112.363, 112.625, 112.63,
10    112.64, 112.658, 112.661, 112.665, 121.021, 121.025,
11    121.031, 121.051, 121.0511, 121.0515, 121.052, 121.055,
12    121.081, 121.085, 121.091, 121.101, 121.111, 121.133,
13    121.135, 121.136, 121.1815, 121.1905, 121.192, 121.193,
14    121.22, 121.23, 121.24, 121.30, 121.35, 121.40, 121.45,
15    121.4501, 122.02, 122.03, 122.05, 122.06, 122.07, 122.08,
16    122.09, 122.10, 122.12, 122.13, 122.15, 122.16, 122.23,
17    122.30, 122.34, 122.351, 175.032, 175.1215, 185.02,
18    185.105, 215.20, 215.28, 215.50, 238.01, 238.02, 238.03,
19    238.05, 238.07, 238.08, 238.09, 238.10, 238.11, 238.12,
20    238.14, 238.15, 238.171, 238.181, 238.32, and 650.02,
21    F.S., to conform to such transfer; providing an effective
22    date.
23         
24          Be It Enacted by the Legislature of the State of Florida:
25         
26          Section 1. The Division of Retirement of the Department of
27    Management Services is transferred to the State Board of
28    Administration. All powers, duties, functions, records,
29    personnel, property, and unexpended balances of appropriations,
30    allocations, and other funds relating to the Division of
31    Retirement are transferred by a type one transfer, as defined in
32    s. 20.06, Florida Statutes, to the State Board of
33    Administration.
34          Section 2. Paragraphs (g) and (h) of subsection (2) of
35    section 20.22, Florida Statutes, are amended to read:
36          20.22 Department of Management Services.--There is created
37    a Department of Management Services.
38          (2) The following divisions and programs within the
39    Department of Management Services are established:
40          (g) Division of Retirement.
41          (g)(h)Division of State Group Insurance.
42          Section 3. Section 20.28, Florida Statutes, is amended to
43    read:
44          20.28 State Board of Administration.--The State Board of
45    Administration, continued by s. 9, Art. XII of the State
46    Constitution, retains all of its powers, duties, and functions
47    as prescribed by law. There is established under the State Board
48    of Administration a Division of Retirement, which shall be
49    subject to the direction of the executive director of the board.
50    Nothing in this act shall be construed to alter or amend the
51    powers, operations, or functioning of the State Board of
52    Administration with respect to its duties, responsibilities, and
53    authority existing prior to the enactment of this legislation.
54          Section 4. Paragraph (u) of subsection (2) of section
55    110.205, Florida Statutes, is amended to read:
56          110.205 Career service; exemptions.--
57          (2) EXEMPT POSITIONS.--The exempt positions that are not
58    covered by this part include the following:
59          (u) All officers and employees of the State Board of
60    Administration, including its Division of Retirement. The State
61    Board of Administration shall set the salaries and benefits of
62    these positions.
63          Section 5. Paragraph (b) of subsection (4) of section
64    112.05, Florida Statutes, is amended to read:
65          112.05 Retirement; cost-of-living adjustment; employment
66    after retirement.--
67          (4)
68          (b) Any person to whom the limitation in paragraph (a)
69    applies who violates such reemployment limitation and is
70    reemployed with any agency participating in the Florida
71    Retirement System prior to completion of the 12-month limitation
72    period shall give timely notice of this fact in writing to the
73    employer and to the Division of Retirement of the State Board of
74    Administration; and the person's retirement benefits shall be
75    suspended for the balance of the 12-month limitation period. Any
76    person employed in violation of this subsection and any
77    employing agency which knowingly employs or appoints such person
78    without notifying the Division of RetirementDepartment of
79    Management Servicesto suspend retirement benefits shall be
80    jointly and severally liable for reimbursement to the retirement
81    trust fund of any benefits paid during the reemployment
82    limitation period. To avoid liability, such employing agency
83    shall have a written statement from the retiree that he or she
84    is not retired from a state-administered retirement system. Any
85    retirement benefits received by such person while reemployed
86    during this limitation period shall be repaid to the retirement
87    trust fund, and the retirement benefits shall remain suspended
88    until such repayment has been made. Any benefits suspended
89    beyond the reemployment limitation period shall apply toward the
90    repayment of benefits received in violation of the reemployment
91    limitation.
92          Section 6. Paragraph (d) of subsection (4) of section
93    112.3173, Florida Statutes, is amended to read:
94          112.3173 Felonies involving breach of public trust and
95    other specified offenses by public officers and employees;
96    forfeiture of retirement benefits.--
97          (4) NOTICE.--
98          (d) The Commission on Ethics shall forward any notice and
99    any other document received by it pursuant to this subsection to
100    the governing body of the public retirement system of which the
101    public officer or employee is a member or from which the public
102    officer or employee may be entitled to receive a benefit. When
103    called on by the Commission on Ethics, the Division of
104    Retirement of the State Board of AdministrationDepartment of
105    Management Servicesshall assist the commission in identifying
106    the appropriate public retirement system.
107          Section 7. Subsection (7) of section 112.352, Florida
108    Statutes, is amended to read:
109          112.352 Definitions.--The following words and phrases as
110    used in this act shall have the following meaning unless a
111    different meaning is required by the context:
112          (7) "DivisionDepartment" means the Division of Retirement
113    of the State Board of AdministrationDepartment of Management
114    Services.
115          Section 8. Section 112.354, Florida Statutes, is amended
116    to read:
117          112.354 Eligibility for supplement.--Each retired member
118    or, if applicable, a joint annuitant, except any person
119    receiving survivor benefits under the teachers' retirement
120    system of the state in accordance with s. 238.07(16), shall be
121    entitled to receive a supplement computed in accordance with s.
122    112.355 upon:
123          (1) Furnishing to the divisionDepartment of Management
124    Servicesevidence from the Social Security Administration
125    setting forth the retired member's social security benefit or
126    certifying the noninsured status of the retired member under the
127    Social Security Act, and
128          (2) Filing written application with the division
129    Department of Management Servicesfor such supplement.
130          Section 9. Section 112.356, Florida Statutes, is amended
131    to read:
132          112.356 Payment of supplement.--Any supplement due and
133    payable under this act shall be paid by the divisiondepartment
134    or under the direction and control of the divisiondepartment,
135    based on information furnished by the retired member, or a joint
136    annuitant, and the administrator of the system under which
137    retirement benefits are being paid, beginning on the first day
138    of the month coincident with or next following the later of the
139    effective date of this act and the date of approval of the
140    application for supplement by the divisiondepartment, and
141    payable thereafter on the first day of each month in the normal
142    or optional form in which retirement benefits under the
143    applicable system are being paid; provided, however, that if
144    application for supplement is made subsequent to December 31,
145    1967, not more than 6 retroactive monthly supplements shall be
146    paid.
147          Section 10. Section 112.358, Florida Statutes, is amended
148    to read:
149          112.358 Administration of system.--The divisionDepartment
150    of Management Servicesshall make such rules and regulations as
151    are necessary for the effective and efficient administration of
152    this act and the cost to pay the expenses of such administration
153    is herebyappropriated out of the appropriate retirement fund.
154          Section 11. Paragraph (g) of subsection (2), and
155    subsections (4), (6), and (8) of section 112.361, Florida
156    Statutes, are amended to read:
157          112.361 Additional and updated supplemental retirement
158    benefits.--
159          (2) DEFINITIONS.--As used in this section, unless a
160    different meaning is required by the context:
161          (g) "DivisionDepartment" means the Division of Retirement
162    of the State Board of AdministrationDepartment of Management
163    Services.
164          (4) ELIGIBILITY FOR SUPPLEMENT.--Each retired member or,
165    if applicable, a joint annuitant, except any person receiving
166    survivor's benefits under the Teachers' Retirement System of the
167    state in accordance with s. 238.07(16), shall be entitled to
168    receive a supplement computed in accordance with subsection (5),
169    upon:
170          (a) Furnishing to the divisiondepartmentevidence from
171    the Social Security Administration setting forth the retired
172    member's social security benefit or certifying the noninsured
173    status of the retired member under the Social Security Act, and
174          (b) Filing written application with the division
175    departmentfor such supplement.
176          (6) PAYMENT OF SUPPLEMENT.--Any supplement due and payable
177    under this section shall be paid by the divisiondepartmentor
178    under the direction and control of the divisiondepartment,
179    based on information furnished by the retired member, or a joint
180    annuitant, and the administrator of the system under which
181    retirement benefits are being paid, beginning on the first day
182    of the month coincident with or next following the later of:
183          (a) July 1, 1969, or
184          (b) The date of approval of the application for supplement
185    by the divisiondepartment,
186         
187          and payable thereafter on the first day of each month in the
188    normal or optional form in which retirement benefits under the
189    applicable system are being paid. However, no retroactive
190    monthly supplements shall be paid for any period prior to the
191    date specified in this paragraph.
192          (8) ADMINISTRATION OF SYSTEM.--The divisiondepartment
193    shall make such rules as are necessary for the effective and
194    efficient administration of this section, and the cost to pay
195    the expenses of such administration is hereby appropriated out
196    of the appropriate fund pursuant to subsection (7).
197          Section 12. Paragraphs (a) and (b) of subsection (4) of
198    section 112.362, Florida Statutes, are amended to read:
199          112.362 Recomputation of retirement benefits.--
200          (4)(a) Effective July 1, 1980, any person who retired
201    prior to July 1, 1987, under a state-supported retirement system
202    with not less than 10 years of creditable service and who is not
203    receiving or entitled to receive federal social security
204    benefits shall, upon reaching 65 years of age and upon
205    application to the divisionDepartment of Management Services,
206    be entitled to receive a minimum monthly benefit equal to $16.50
207    multiplied by the member's total number of years of creditable
208    service and adjusted by the actuarial factor applied to the
209    original benefit for optional forms of retirement. Thereafter,
210    the minimum monthly benefit shall be recomputed as provided in
211    paragraph (5)(a). Application for this minimum monthly benefit
212    shall include certification by the retired member that he or she
213    is not receiving and is not entitled to receive social security
214    benefits and shall include written authorization for the
215    divisionDepartment of Management Servicesto have access to
216    information from the Federal Social Security Administration
217    concerning the member's entitlement to or eligibility for social
218    security benefits. The minimum benefit provided by this
219    paragraph shall not be paid unless and until the application
220    requirements of this paragraph are satisfied.
221          (b) Effective July 1, 1978, the surviving spouse or
222    beneficiary who is receiving or entitled to receive a monthly
223    benefit commencing prior to July 1, 1987, from the account of
224    any deceased retired member who had completed at least 10 years
225    of creditable service shall, at the time such deceased retiree
226    would have reached age 65, if living, and, upon application to
227    the divisionDepartment of Management Services, be entitled to
228    receive the minimum monthly benefit described in paragraph (a),
229    adjusted by the actuarial factor applied to the optional form of
230    benefit payable to said surviving spouse or beneficiary,
231    provided said person is not receiving or entitled to receive
232    federal social security benefits. Application for this minimum
233    monthly benefit shall include certification by the surviving
234    spouse or beneficiary that he or she is not receiving and is not
235    entitled to receive social security benefits and shall include
236    written authorization for the divisionDepartment of Management
237    Servicesto have access to information from the Federal Social
238    Security Administration concerning such person's entitlement to
239    or eligibility for social security benefits. The minimum benefit
240    provided by this paragraph shall not be paid unless and until
241    the application requirements of this paragraph are satisfied.
242          Section 13. Subsections (2), (4), (7), and (8) of section
243    112.363, Florida Statutes, are amended to read:
244          112.363 Retiree health insurance subsidy.--
245          (2) ELIGIBILITY FOR RETIREE HEALTH INSURANCE SUBSIDY.--
246          (a) A person who is retired under a state-administered
247    retirement system, or a beneficiary who is a spouse or financial
248    dependent entitled to receive benefits under a state-
249    administered retirement system, is eligible for health insurance
250    subsidy payments provided under this section; except that
251    pension recipients under ss. 121.40, 238.07(16)(a), and 250.22,
252    recipients of health insurance coverage under s. 110.1232, or
253    any other special pension or relief act shall not be eligible
254    for such payments.
255          (b) For purposes of this section, a person is deemed
256    retired from a state-administered retirement system when he or
257    she terminates employment with all employers participating in
258    the Florida Retirement System as described in s. 121.021(39)
259    and:
260          1. For a participant of the Public Employee Optional
261    Retirement Program established under part II of chapter 121, the
262    participant meets the age or service requirements to qualify for
263    normal retirement as set forth in s. 121.021(29).
264          2. For a member of the Florida Retirement System defined
265    benefit program, or any employee who maintains creditable
266    service under both the defined benefit program and the Public
267    Employee Optional Retirement Program, the member begins drawing
268    retirement benefits from the defined benefit program of the
269    Florida Retirement System.
270          (c)1. Effective July 1, 2001, any person retiring on or
271    after such date as a member of the Florida Retirement System,
272    including any participant of the defined contribution program
273    administered pursuant to part II of chapter 121, must have
274    satisfied the vesting requirements for his or her membership
275    class under the Florida Retirement System defined benefit
276    program as administered under part I of chapter 121.
277          2. Notwithstanding the provisions of subparagraph 1., a
278    person retiring due to disability must either qualify for a
279    regular or in-line-of-duty disability benefit as provided in s.
280    121.091(4) or qualify for a disability benefit under a
281    disability plan established under part II of chapter 121, as
282    appropriate.
283          (d) Payment of the retiree health insurance subsidy shall
284    be made only after coverage for health insurance for the retiree
285    or beneficiary has been certified in writing to the division
286    Department of Management Services. Participation in a former
287    employer's group health insurance program is not a requirement
288    for eligibility under this section.
289          (e) Participants in the Senior Management Service Optional
290    Annuity Program as provided in s. 121.055(6) and the State
291    University System Optional Retirement Program as provided in s.
292    121.35 shall not receive the retiree health insurance subsidy
293    provided in this section. The employer of such participant shall
294    pay the contributions required in subsection (8) to the annuity
295    program provided in s. 121.055(6)(d) or s. 121.35(4)(a), as
296    applicable.
297          (4) PAYMENT OF RETIREE HEALTH INSURANCE
298    SUBSIDY.--Beginning January 1, 1988, any monthly retiree health
299    insurance subsidy amount due and payable under this section
300    shall be paid to retired members by the divisionDepartment of
301    Management Services or under the direction and control of the
302    divisiondepartment.
303          (7) ADMINISTRATION OF SYSTEM.--The divisionDepartment of
304    Management Servicesmay adopt such rules and regulations as are
305    necessary for the effective and efficient administration of this
306    section. The cost of administration shall be appropriated from
307    the trust fund.
308          (8) CONTRIBUTIONS.--For purposes of funding the insurance
309    subsidy provided by this section:
310          (a) Beginning October 1, 1987, the employer of each member
311    of a state-administered retirement plan shall contribute 0.24
312    percent of gross compensation each pay period.
313          (b) Beginning January 1, 1989, the employer of each member
314    of a state-administered retirement plan shall contribute 0.48
315    percent of gross compensation each pay period.
316          (c) Beginning January 1, 1994, the employer of each member
317    of a state-administered retirement plan shall contribute 0.56
318    percent of gross compensation each pay period.
319          (d) Beginning January 1, 1995, the employer of each member
320    of a state-administered retirement plan shall contribute 0.66
321    percent of gross compensation each pay period.
322          (e) Beginning July 1, 1998, the employer of each member of
323    a state-administered retirement plan shall contribute 0.94
324    percent of gross compensation each pay period.
325          (f) Beginning July 1, 2001, the employer of each member of
326    a state-administered plan shall contribute 1.11 percent of gross
327    compensation each pay period.
328         
329          Such contributions shall be submitted to the divisionDepartment
330    of Management Servicesand deposited in the Retiree Health
331    Insurance Subsidy Trust Fund.
332          Section 14. Subsection (10) is added to section 112.625,
333    Florida Statutes, to read:
334          112.625 Definitions.--As used in this act:
335          (10) "Division" means the Division of Retirement of the
336    State Board of Administration.
337          Section 15. Subsections (2) and (4) of section 112.63,
338    Florida Statutes, are amended to read:
339          112.63 Actuarial reports and statements of actuarial
340    impact; review.--
341          (2) The frequency of actuarial reports must be at least
342    every 3 years commencing from the last actuarial report of the
343    plan or system or October 1, 1980, if no actuarial report has
344    been issued within the 3-year period prior to October 1, 1979.
345    The results of each actuarial report shall be filed with the
346    plan administrator within 60 days of certification. Thereafter,
347    the results of each actuarial report shall be made available for
348    inspection upon request. Additionally, each retirement system or
349    plan covered by this act which is not administered directly by
350    the divisionDepartment of Management Servicesshall furnish a
351    copy of each actuarial report to the divisionDepartment of
352    Management Serviceswithin 60 days after receipt from the
353    actuary. The requirements of this section are supplemental to
354    actuarial valuations necessary to comply with the requirements
355    of ss. 218.321 and 218.39.
356          (4) Upon receipt, pursuant to subsection (2), of an
357    actuarial report, or upon receipt, pursuant to subsection (3),
358    of a statement of actuarial impact, the divisionDepartment of
359    Management Servicesshall acknowledge such receipt, but shall
360    only review and comment on each retirement system's or plan's
361    actuarial valuations at least on a triennial basis. If the
362    divisiondepartmentfinds that the actuarial valuation is not
363    complete, accurate, or based on reasonable assumptions, or if
364    the divisiondepartmentdoes not receive the actuarial report or
365    statement of actuarial impact, the divisiondepartmentshall
366    notify the local government and request appropriate adjustment.
367    If, after a reasonable period of time, a satisfactory adjustment
368    is not made, the affected local government or the division
369    departmentmay petition for a hearing under the provisions of
370    ss. 120.569 and 120.57. If the administrative law judge
371    recommends in favor of the divisiondepartment, the division
372    departmentshall perform an actuarial review or prepare the
373    statement of actuarial impact. The cost to the division
374    departmentof performing such actuarial review or preparing such
375    statement shall be charged to the governmental entity of which
376    the employees are covered by the retirement system or plan. If
377    payment of such costs is not received by the divisiondepartment
378    within 60 days after receipt by the governmental entity of the
379    request for payment, the divisiondepartmentshall certify to
380    the Comptroller the amount due, and the Comptroller shall pay
381    such amount to the divisiondepartmentfrom any funds payable to
382    the governmental entity of which the employees are covered by
383    the retirement system or plan. If the administrative law judge
384    recommends in favor of the local retirement system and the
385    divisiondepartmentperforms an actuarial review, the cost to
386    the divisiondepartmentof performing the actuarial review shall
387    be paid by the divisiondepartment.
388          Section 16. Subsection (1) of section 112.64, Florida
389    Statutes, is amended to read:
390          112.64 Administration of funds; amortization of unfunded
391    liability.--
392          (1) Employee contributions shall be deposited in the
393    retirement system or plan at least monthly. Employer
394    contributions shall be deposited at least quarterly; however,
395    any revenues received from any source by an employer which are
396    specifically collected for the purpose of allocation for deposit
397    into a retirement system or plan shall be so deposited within 30
398    days of receipt by the employer. All employers and employees
399    participating in the Florida Retirement System and other
400    existing retirement systems which are administered by the
401    divisionDepartment of Management Servicesshall continue to
402    make contributions at least monthly.
403          Section 17. Subsections (1) and (3) of section 112.658,
404    Florida Statutes, are amended to read:
405          112.658 Office of Program Policy Analysis and Government
406    Accountability to determine compliance of the Florida Retirement
407    System.--
408          (1) The Office of Program Policy Analysis and Government
409    Accountability shall determine, through the examination of
410    actuarial reviews, financial statements, and the practices and
411    procedures of the Division of RetirementDepartment of
412    Management Services, the compliance of the Florida Retirement
413    System with the provisions of this act.
414          (3) The Office of Program Policy Analysis and Government
415    Accountability shall employ the same actuarial standards to
416    monitor the divisionDepartment of Management Services as the
417    divisionDepartment of Management Servicesuses to monitor local
418    governments.
419          Section 18. Subsections (9), (16), and (17) of section
420    112.661, Florida Statutes, are amended to read:
421          112.661 Investment policies.--Investment of the assets of
422    any local retirement system or plan must be consistent with a
423    written investment policy adopted by the board. Such policies
424    shall be structured to maximize the financial return to the
425    retirement system or plan consistent with the risks incumbent in
426    each investment and shall be structured to establish and
427    maintain an appropriate diversification of the retirement system
428    or plan's assets.
429          (9) EXPECTED ANNUAL RATE OF RETURN.--The investment policy
430    shall require that, for each actuarial valuation, the board
431    determine the total expected annual rate of return for the
432    current year, for each of the next several years, and for the
433    long term thereafter. This determination must be filed promptly
434    with the divisionDepartment of Management Servicesand with the
435    plan's sponsor and the consulting actuary. The department shall
436    use this determination only to notify the board, the plan's
437    sponsor, and consulting actuary of material differences between
438    the total expected annual rate of return and the actuarial
439    assumed rate of return.
440          (16) FILING OF INVESTMENT POLICY.--Upon adoption by the
441    board, the investment policy shall be promptly filed with the
442    divisionDepartment of Management Servicesand the plan's
443    sponsor and consulting actuary. The effective date of the
444    investment policy, and any amendment thereto, shall be the 31st
445    calendar day following the filing date with the plan sponsor.
446          (17) VALUATION OF ILLIQUID INVESTMENTS.--The investment
447    policy shall provide for the valuation of illiquid investments
448    for which a generally recognized market is not available or for
449    which there is no consistent or generally accepted pricing
450    mechanism. If those investments are utilized, the investment
451    policy must include the criteria set forth in s. 215.47(6),
452    except that submission to the Investment Advisory Council is not
453    required. The investment policy shall require that, for each
454    actuarial valuation, the board must verify the determination of
455    the fair market value for those investments and ascertain that
456    the determination complies with all applicable state and federal
457    requirements. The investment policy shall require that the board
458    disclose to the divisionDepartment of Management Servicesand
459    the plan's sponsor each such investment for which the fair
460    market value is not provided.
461          Section 19. Section 112.665, Florida Statutes, is amended
462    to read:
463          112.665 Duties of Division of RetirementDepartment of
464    Management Services.--
465          (1) The Division of RetirementDepartment of Management
466    Servicesshall:
467          (a) Gather, catalog, and maintain complete, computerized
468    data information on all public employee retirement systems or
469    plans in the state, based upon a review of audits, reports, and
470    other data pertaining to the systems or plans;
471          (b) Receive and comment upon all actuarial reviews of
472    retirement systems or plans maintained by units of local
473    government;
474          (c) Cooperate with local retirement systems or plans on
475    matters of mutual concern and provide technical assistance to
476    units of local government in the assessment and revision of
477    retirement systems or plans;
478          (d) Issue, by January 1 annually, a report to the
479    President of the Senate and the Speaker of the House of
480    Representatives, which report details division activities,
481    findings, and recommendations concerning all governmental
482    retirement systems. The report may include legislation proposed
483    to carry out such recommendations;
484          (e) Issue, by January 1 annually, a report to the Special
485    District Information Program of the Department of Community
486    Affairs that includes the participation in and compliance of
487    special districts with the local government retirement system
488    provisions in s. 112.63 and the state-administered retirement
489    system provisions as specified in part I of chapter 121; and
490          (f) Adopt reasonable rules to administer the provisions of
491    this part.
492          (2) The divisiondepartmentmay subpoena actuarial
493    witnesses, review books and records, hold hearings, and take
494    testimony. A witness shall have the right to be accompanied by
495    counsel.
496          Section 20. Subsections (4), (5), and (32), and paragraph
497    (a) of subsection (39) of section 121.021, Florida Statutes, are
498    amended to read:
499          121.021 Definitions.--The following words and phrases as
500    used in this chapter have the respective meanings set forth
501    unless a different meaning is plainly required by the context:
502          (4) "DivisionDepartment" means the Division of Retirement
503    of the State Board of AdministrationDepartment of Management
504    Services.
505          (5) "Administrator" means the executive director of the
506    State Board of Administrationsecretary of the Department of
507    Management Services.
508          (32) "State agency" means the Division of Retirement
509    Department of Management Serviceswithin the provisions and
510    contemplation of chapter 650.
511          (39)(a) "Termination" occurs, except as provided in
512    paragraph (b), when a member ceases all employment relationships
513    with employers under this system, as defined in subsection (10),
514    but in the event a member should be employed by any such
515    employer within the next calendar month, termination shall be
516    deemed not to have occurred. A leave of absence shall constitute
517    a continuation of the employment relationship, except that a
518    leave of absence without pay due to disability may constitute
519    termination for a member, if such member makes application for
520    and is approved for disability retirement in accordance with s.
521    121.091(4). The divisiondepartmentmay require other evidence
522    of termination as it deems necessary.
523          Section 21. Section 121.025, Florida Statutes, is amended
524    to read:
525          121.025 Administrator; powers and duties.--The Division of
526    Retirementsecretary of the Department of Management Services
527    shall be the administrator of the retirement and pension systems
528    assigned or transferred to itthe Department of Management
529    Services by law. The executive director of the State Board of
530    Administrationandshall have the authority to sign the
531    contracts necessary to carry out the duties and responsibilities
532    assigned by law to the divisionDepartment of Management
533    Services.
534          Section 22. Subsections (1), (2), and (5) and paragraph
535    (e) of subsection (3) of section 121.031, Florida Statutes, are
536    amended to read:
537          121.031 Administration of system; appropriation; oaths;
538    actuarial studies; public records.--
539          (1) The divisionDepartment of Management Serviceshas the
540    authority to adopt rules pursuant to ss. 120.536(1) and 120.54
541    to implement the provisions of law conferring duties upon the
542    divisiondepartmentand to adopt rules as are necessary for the
543    effective and efficient administration of this system. The funds
544    to pay the expenses for administration of the system are hereby
545    appropriated from the interest earned on investments made for
546    the retirement and social security trust funds and the
547    assessments allowed under chapter 650.
548          (2) The divisionDepartment of Management Servicesis
549    authorized to require oaths, by affidavit or otherwise, and
550    acknowledgments from persons in connection with the
551    administration of its duties and responsibilities under this
552    chapter.
553          (3) The administrator shall cause an actuarial study of
554    the system to be made at least annually and shall report the
555    results of such study to the Legislature by December 31 prior to
556    the next legislative session. The study shall, at a minimum,
557    conform to the requirements of s. 112.63, with the following
558    exceptions and additions:
559          (e) The study shall include measures of funding status and
560    funding progress designed to facilitate the assessment of trends
561    over several actuarial valuations with respect to the overall
562    solvency of the system. Such measures shall be adopted by the
563    divisiondepartmentand shall be used consistently in all
564    actuarial valuations performed on the system.
565          (5) The names and addresses of retirees are confidential
566    and exempt from the provisions of s. 119.07(1) to the extent
567    that no state or local governmental agency may provide the names
568    or addresses of such persons in aggregate, compiled, or list
569    form to any person except to a public agency engaged in official
570    business. However, a state or local government agency may
571    provide the names and addresses of retirees from that agency to
572    a bargaining agent as defined in s. 447.203(12) or to a retiree
573    organization for official business use. Lists of names or
574    addresses of retirees may be exchanged by public agencies, but
575    such lists shall not be provided to, or open for inspection by,
576    the public. Any person may view or copy any individual's
577    retirement records at the divisionDepartment of Management
578    Services, one record at a time, or may obtain information by a
579    separate written request for a named individual for which
580    information is desired.
581          Section 23. Paragraph (c) of subsection (1) and paragraphs
582    (b) and (f) of subsection (2) of section 121.051, Florida
583    Statutes, are amended to read:
584          121.051 Participation in the system.--
585          (1) COMPULSORY PARTICIPATION.--
586          (c)1. After June 30, 1983, a member of an existing system
587    who is reemployed after terminating employment shall have at the
588    time of reemployment the option of selecting to remain in the
589    existing retirement system or to transfer to the Florida
590    Retirement System. Failure to submit such selection in writing
591    to the divisionDepartment of Management Serviceswithin 6
592    months of reemployment shall result in compulsory membership in
593    the Florida Retirement System.
594          2. After June 30, 1988, the provisions of subparagraph 1.
595    shall not apply to a member of an existing system who is
596    reemployed within 12 months after terminating employment. Such
597    member shall continue to have membership in the existing system
598    upon reemployment and shall not be permitted to become a member
599    of the Florida Retirement System, except by transferring to that
600    system as provided in ss. 121.052 and 121.055.
601          (2) OPTIONAL PARTICIPATION.--
602          (b)1. The governing body of any municipality or special
603    district in the state may elect to participate in the system
604    upon proper application to the administrator and may cover all
605    or any of its units as approved by the Secretary of Health and
606    Human Services and the administrator. The divisiondepartment
607    shall adopt rules establishing provisions for the submission of
608    documents necessary for such application. Prior to being
609    approved for participation in the Florida Retirement System, the
610    governing body of any such municipality or special district that
611    has a local retirement system shall submit to the administrator
612    a certified financial statement showing the condition of the
613    local retirement system as of a date within 3 months prior to
614    the proposed effective date of membership in the Florida
615    Retirement System. The statement must be certified by a
616    recognized accounting firm that is independent of the local
617    retirement system. All required documents necessary for
618    extending Florida Retirement System coverage must be received by
619    the divisiondepartmentfor consideration at least 15 days prior
620    to the proposed effective date of coverage. If the municipality
621    or special district does not comply with this requirement, the
622    divisiondepartmentmay require that the effective date of
623    coverage be changed.
624          2. Any city or special district that has an existing
625    retirement system covering the employees in the units that are
626    to be brought under the Florida Retirement System may
627    participate only after holding a referendum in which all
628    employees in the affected units have the right to participate.
629    Only those employees electing coverage under the Florida
630    Retirement System by affirmative vote in said referendum shall
631    be eligible for coverage under this chapter, and those not
632    participating or electing not to be covered by the Florida
633    Retirement System shall remain in their present systems and
634    shall not be eligible for coverage under this chapter. After the
635    referendum is held, all future employees shall be compulsory
636    members of the Florida Retirement System.
637          3. The governing body of any city or special district
638    complying with subparagraph 1. may elect to provide, or not
639    provide, benefits based on past service of officers and
640    employees as described in s. 121.081(1). However, if such
641    employer elects to provide past service benefits, such benefits
642    must be provided for all officers and employees of its covered
643    group.
644          4. Once this election is made and approved it may not be
645    revoked, except pursuant to subparagraphs 5. and 6., and all
646    present officers and employees electing coverage under this
647    chapter and all future officers and employees shall be
648    compulsory members of the Florida Retirement System.
649          5. Subject to the conditions set forth in subparagraph 6.,
650    the governing body of any hospital licensed under chapter 395
651    which is governed by the board of a special district as defined
652    in s. 189.403(1) or by the board of trustees of a public health
653    trust created under s. 154.07, hereinafter referred to as
654    "hospital district," and which participates in the system, may
655    elect to cease participation in the system with regard to future
656    employees in accordance with the following procedure:
657          a. No more than 30 days and at least 7 days before
658    adopting a resolution to partially withdraw from the Florida
659    Retirement System and establish an alternative retirement plan
660    for future employees, a public hearing must be held on the
661    proposed withdrawal and proposed alternative plan.
662          b. From 7 to 15 days before such hearing, notice of intent
663    to withdraw, specifying the time and place of the hearing, must
664    be provided in writing to employees of the hospital district
665    proposing partial withdrawal and must be published in a
666    newspaper of general circulation in the area affected, as
667    provided by ss. 50.011-50.031. Proof of publication of such
668    notice shall be submitted to the divisionDepartment of
669    Management Services.
670          c. The governing body of any hospital district seeking to
671    partially withdraw from the system must, before such hearing,
672    have an actuarial report prepared and certified by an enrolled
673    actuary, as defined in s. 112.625(3), illustrating the cost to
674    the hospital district of providing, through the retirement plan
675    that the hospital district is to adopt, benefits for new
676    employees comparable to those provided under the Florida
677    Retirement System.
678          d. Upon meeting all applicable requirements of this
679    subparagraph, and subject to the conditions set forth in
680    subparagraph 6., partial withdrawal from the system and adoption
681    of the alternative retirement plan may be accomplished by
682    resolution duly adopted by the hospital district board. The
683    hospital district board must provide written notice of such
684    withdrawal to the division by mailing a copy of the resolution
685    to the division, postmarked no later than December 15, 1995. The
686    withdrawal shall take effect January 1, 1996.
687          6. Following the adoption of a resolution under sub-
688    subparagraph 5.d., all employees of the withdrawing hospital
689    district who were participants in the Florida Retirement System
690    prior to January 1, 1996, shall remain as participants in the
691    system for as long as they are employees of the hospital
692    district, and all rights, duties, and obligations between the
693    hospital district, the system, and the employees shall remain in
694    full force and effect. Any employee who is hired or appointed on
695    or after January 1, 1996, may not participate in the Florida
696    Retirement System, and the withdrawing hospital district shall
697    have no obligation to the system with respect to such employees.
698          (f)1. Whenever an employer that participates in the
699    Florida Retirement System undertakes the transfer, merger, or
700    consolidation of governmental services or functions, the
701    employer must notify the divisiondepartmentat least 60 days
702    prior to such action and shall provide documentation as required
703    by the divisiondepartment.
704          2. When the agency to which a member's employing unit is
705    transferred, merged, or consolidated does not participate in the
706    Florida Retirement System, a member shall elect in writing to
707    remain in the Florida Retirement System or to transfer to the
708    local retirement system operated by such agency. If such agency
709    does not participate in a local retirement system, the member
710    shall continue membership in the Florida Retirement System. In
711    either case, the membership shall continue for as long as the
712    member is employed by the agency to which his or her unit was
713    transferred, merged, or consolidated.
714          Section 24. Subsection (2) of section 121.0511, Florida
715    Statutes, is amended to read:
716          121.0511 Revocation of election and alternative plan.--The
717    governing body of any municipality or independent special
718    district that has elected to participate in the Florida
719    Retirement System may revoke its election in accordance with the
720    following procedure:
721          (2) At least 7 days, but not more than 15 days, before the
722    hearing, notice of intent to revoke, specifying the time and
723    place of the hearing, must be published in a newspaper of
724    general circulation in the area affected, as provided by ss.
725    50.011-50.031. Proof of publication of the notice must be
726    submitted to the divisionDepartment of Management Services.
727          Section 25. Subsections (3) and (4) and paragraph (c) of
728    subsection (7) of section 121.0515, Florida Statutes, are
729    amended to read:
730          121.0515 Special risk membership.--
731          (3) PROCEDURE FOR DESIGNATING.--
732          (a) Any member of the Florida Retirement System employed
733    by a county, city, or special district who feels that he or she
734    meets the criteria set forth in this section for membership in
735    the Special Risk Class may request that his or her employer
736    submit an application to the divisiondepartmentrequesting that
737    the divisiondepartmentdesignate him or her as a special risk
738    member. If the employer agrees that the member meets the
739    requirements for special risk membership, the employer shall
740    submit an application to the divisiondepartmentin behalf of
741    the employee containing a certification that the member meets
742    the criteria for special risk membership set forth in this
743    section and such other supporting documentation as may be
744    required by administrative rule. The divisiondepartmentshall,
745    within 90 days, either designate or refuse to designate the
746    member as a special risk member. If the employer declines to
747    submit the member's application to the divisiondepartmentor if
748    the divisiondepartmentdoes not designate the member as a
749    special risk member, the member or the employer may appeal to
750    the State Retirement Commission, as provided in s. 121.23, for
751    designation as a special risk member. A member who receives a
752    final affirmative ruling pursuant to such appeal for special
753    risk membership shall have special risk membership retroactive
754    to the date such member would have had special risk membership
755    had such membership been approved by the employer and the
756    divisiondepartment, as determined by the divisiondepartment,
757    and the employer contributions shall be paid in full within 1
758    year after such final ruling.
759          (b)1. Applying the criteria set forth in this section, the
760    divisionDepartment of Management Servicesshall specify which
761    current and newly created classes of positions under the uniform
762    classification plan established pursuant to chapter 110 entitle
763    the incumbents of positions in those classes to membership in
764    the Special Risk Class. Only employees employed in the classes
765    so specified shall be special risk members.
766          2. When a class is not specified by the division
767    departmentas provided in subparagraph 1., the employing agency
768    may petition the State Retirement Commission for approval in
769    accordance with s. 121.23.
770          (4) REMOVAL OF SPECIAL RISK MEMBERSHIP.--Any member who is
771    a special risk member on October 1, 1978, and who fails to meet
772    the criteria for special risk membership established by this
773    section shall have his or her special risk designation removed
774    and thereafter shall be a regular member and shall earn only
775    regular membership credit. The divisiondepartmentshall have
776    the authority to review the special risk designation of members
777    to determine whether or not those members continue to meet the
778    criteria for special risk membership.
779          (7) RETENTION OF SPECIAL RISK NORMAL RETIREMENT DATE.--
780          (c) The divisiondepartmentshall adopt such rules as are
781    required to administer this subsection.
782          Section 26. Paragraph (e) of subsection (3) of section
783    121.052, Florida Statutes, is amended to read:
784          121.052 Membership class of elected officers.--
785          (3) PARTICIPATION AND WITHDRAWAL, GENERALLY.--Effective
786    July 1, 1990, participation in the Elected Officers' Class shall
787    be compulsory for elected officers listed in paragraphs (2)(a)-
788    (d) and (f) assuming office on or after said date, unless the
789    elected officer elects membership in another class or withdraws
790    from the Florida Retirement System as provided in paragraphs
791    (3)(a)-(d):
792          (e) Effective July 1, 2001, the governing body of a
793    municipality or special district may, by majority vote, elect to
794    designate all its elected positions for inclusion in the Elected
795    Officers' Class. Such election shall be made between July 1,
796    2001, and December 31, 2001, and shall be irrevocable. The
797    designation of such positions shall be effective the first day
798    of the month following receipt by the divisiondepartmentof the
799    ordinance or resolution passed by the governing body.
800          Section 27. Paragraphs (b) and (h) of subsection (1) and
801    paragraphs (a), (c), (d), and (f) of subsection (6) of section
802    121.055, Florida Statutes, are amended to read:
803          121.055 Senior Management Service Class.--There is hereby
804    established a separate class of membership within the Florida
805    Retirement System to be known as the "Senior Management Service
806    Class," which shall become effective February 1, 1987.
807          (1)
808          (b)1. Except as provided in subparagraph 2., effective
809    January 1, 1990, participation in the Senior Management Service
810    Class shall be compulsory for the president of each community
811    college, the manager of each participating city or county, and
812    all appointed district school superintendents. Effective January
813    1, 1994, additional positions may be designated for inclusion in
814    the Senior Management Service Class of the Florida Retirement
815    System, provided that:
816          a. Positions to be included in the class shall be
817    designated by the local agency employer. Notice of intent to
818    designate positions for inclusion in the class shall be
819    published once a week for 2 consecutive weeks in a newspaper of
820    general circulation published in the county or counties
821    affected, as provided in chapter 50.
822          b. Up to 10 nonelective full-time positions may be
823    designated for each local agency employer reporting to the
824    divisionDepartment of Management Services; for local agencies
825    with 100 or more regularly established positions, additional
826    nonelective full-time positions may be designated, not to exceed
827    1 percent of the regularly established positions within the
828    agency.
829          c. Each position added to the class must be a managerial
830    or policymaking position filled by an employee who is not
831    subject to continuing contract and serves at the pleasure of the
832    local agency employer without civil service protection, and who:
833          (I) Heads an organizational unit; or
834          (II) Has responsibility to effect or recommend personnel,
835    budget, expenditure, or policy decisions in his or her areas of
836    responsibility.
837          2. In lieu of participation in the Senior Management
838    Service Class, members of the Senior Management Service Class
839    pursuant to the provisions of subparagraph 1. may withdraw from
840    the Florida Retirement System altogether. The decision to
841    withdraw from the Florida Retirement System shall be irrevocable
842    for as long as the employee holds such a position. Any service
843    creditable under the Senior Management Service Class shall be
844    retained after the member withdraws from the Florida Retirement
845    System; however, additional service credit in the Senior
846    Management Service Class shall not be earned after such
847    withdrawal. Such members shall not be eligible to participate in
848    the Senior Management Service Optional Annuity Program.
849          (h)1. Except as provided in subparagraph 3., effective
850    January 1, 1994, participation in the Senior Management Service
851    Class shall be compulsory for the State Courts Administrator and
852    the Deputy State Courts Administrators, the Clerk of the Supreme
853    Court, the Marshal of the Supreme Court, the Executive Director
854    of the Justice Administrative Commission, the Capital Collateral
855    Regional Counsels, the clerks of the district courts of appeals,
856    the marshals of the district courts of appeals, and the trial
857    court administrator and the Chief Deputy Court Administrator in
858    each judicial circuit. Effective January 1, 1994, additional
859    positions in the offices of the state attorney and public
860    defender in each judicial circuit may be designated for
861    inclusion in the Senior Management Service Class of the Florida
862    Retirement System, provided that:
863          a. Positions to be included in the class shall be
864    designated by the state attorney or public defender, as
865    appropriate. Notice of intent to designate positions for
866    inclusion in the class shall be published once a week for 2
867    consecutive weeks in a newspaper of general circulation
868    published in the county or counties affected, as provided in
869    chapter 50.
870          b. One nonelective full-time position may be designated
871    for each state attorney and public defender reporting to the
872    divisionDepartment of Management Services; for agencies with
873    200 or more regularly established positions under the state
874    attorney or public defender, additional nonelective full-time
875    positions may be designated, not to exceed 0.5 percent of the
876    regularly established positions within the agency.
877          c. Each position added to the class must be a managerial
878    or policymaking position filled by an employee who serves at the
879    pleasure of the state attorney or public defender without civil
880    service protection, and who:
881          (I) Heads an organizational unit; or
882          (II) Has responsibility to effect or recommend personnel,
883    budget, expenditure, or policy decisions in his or her areas of
884    responsibility.
885          2. Participation in this class shall be compulsory, except
886    as provided in subparagraph 3., for any judicial employee who
887    holds a position designated for coverage in the Senior
888    Management Service Class, and such participation shall continue
889    until the employee terminates employment in a covered position.
890    Effective January 1, 2001, participation in this class is
891    compulsory for assistant state attorneys, assistant statewide
892    prosecutors, assistant public defenders, and assistant capital
893    collateral regional counsels. Effective January 1, 2002,
894    participation in this class is compulsory for assistant
895    attorneys general.
896          3. In lieu of participation in the Senior Management
897    Service Class, such members, excluding assistant state
898    attorneys, assistant public defenders, assistant statewide
899    prosecutors, assistant attorneys general, and assistant capital
900    collateral regional counsels, may participate in the Senior
901    Management Service Optional Annuity Program as established in
902    subsection (6).
903          (6)(a) Senior Management Service Optional Annuity
904    Program.--The Division of RetirementDepartment of Management
905    Servicesshall establish a Senior Management Service Optional
906    Annuity Program under which contracts providing retirement,
907    death, and disability benefits may be purchased for those
908    employees who elect to participate in the optional annuity
909    program. The benefits to be provided for or on behalf of
910    participants in such optional annuity program shall be provided
911    through individual contracts or individual certificates issued
912    for group annuity contracts, which may be fixed, variable, or a
913    combination thereof, in accordance with s. 401(a) of the
914    Internal Revenue Code. Any such individual contract or
915    certificate shall state the annuity plan on its face page, and
916    shall include, but not be limited to, a statement of ownership,
917    the contract benefits, annuity income options, limitations,
918    expense charges, and surrender charges, if any. The employing
919    agency shall contribute, as provided in this section, toward the
920    purchase of such optional benefits which shall be fully and
921    immediately vested in the participants.
922          (c) Participation.--
923          1. Any eligible employee who is employed on or before
924    February 1, 1987, may elect to participate in the optional
925    annuity program in lieu of participation in the Senior
926    Management Service Class. Such election shall be made in writing
927    and filed with the divisiondepartmentand the personnel officer
928    of the employer on or before May 1, 1987. Any eligible employee
929    who is employed on or before February 1, 1987, and who fails to
930    make an election to participate in the optional annuity program
931    by May 1, 1987, shall be deemed to have elected membership in
932    the Senior Management Service Class.
933          2. Any employee who becomes eligible to participate in the
934    optional annuity program by reason of initial employment
935    commencing after February 1, 1987, may, within 90 days after the
936    date of commencement of employment, elect to participate in the
937    optional annuity program. Such election shall be made in writing
938    and filed with the personnel officer of the employer. Any
939    eligible employee who does not within 90 days after commencement
940    of such employment elect to participate in the optional annuity
941    program shall be deemed to have elected membership in the Senior
942    Management Service Class.
943          3. A person who is appointed to a position in the Senior
944    Management Service Class and who is a member of an existing
945    retirement system or the Special Risk or Special Risk
946    Administrative Support Classes of the Florida Retirement System
947    may elect to remain in such system or class in lieu of
948    participation in the Senior Management Service Class or optional
949    annuity program. Such election shall be made in writing and
950    filed with the divisiondepartmentand the personnel officer of
951    the employer within 90 days of such appointment. Any eligible
952    employee who fails to make an election to participate in the
953    existing system, the Special Risk Class of the Florida
954    Retirement System, the Special Risk Administrative Support Class
955    of the Florida Retirement System, or the optional annuity
956    program shall be deemed to have elected membership in the Senior
957    Management Service Class.
958          4. Except as provided in subparagraph 5., an employee's
959    election to participate in the optional annuity program is
960    irrevocable as long as such employee continues to be employed in
961    an eligible position and continues to meet the eligibility
962    requirements set forth in this paragraph.
963          5. Effective from July 1, 2002, through September 30,
964    2002, any active employee in a regularly established position
965    who has elected to participate in the Senior Management Service
966    Optional Annuity Program has one opportunity to choose to move
967    from the Senior Management Service Optional Annuity Program to
968    the Florida Retirement System defined benefit program.
969          a. The election must be made in writing and must be filed
970    with the department and the personnel officer of the employer
971    before October 1, 2002, or, in the case of an active employee
972    who is on a leave of absence on July 1, 2002, within 90 days
973    after the conclusion of the leave of absence. This election is
974    irrevocable.
975          b. The employee will receive service credit under the
976    defined benefit program of the Florida Retirement System equal
977    to his or her years of service under the Senior Management
978    Service Optional Annuity Program. The cost for such credit shall
979    be an amount representing the present value of that employee's
980    accumulated benefit obligation for the affected period of
981    service.
982          c. The employee must transfer the total accumulated
983    employer contributions and earnings on deposit in his or her
984    Senior Management Service Optional Annuity Program account. If
985    the transferred amount is not sufficient to pay the amount due,
986    the employee must pay a sum representing the remainder of the
987    amount due. In no case may the employee retain any employer
988    contributions or earnings thereon from the Senior Management
989    Service Optional Annuity Program account.
990          (d) Contributions.--
991          1. Through June 30, 2001, each employer shall contribute
992    on behalf of each participant in the Senior Management Service
993    Optional Annuity Program an amount equal to the normal cost
994    portion of the employer retirement contribution which would be
995    required if the participant were a Senior Management Service
996    Class member of the Florida Retirement System defined benefit
997    program, plus the portion of the contribution rate required in
998    s. 112.363(8) that would otherwise be assigned to the Retiree
999    Health Insurance Subsidy Trust Fund. Effective July 1, 2001,
1000    each employer shall contribute on behalf of each participant in
1001    the optional program an amount equal to 12.49 percent of the
1002    participant's gross monthly compensation. The division
1003    departmentshall deduct an amount approved by the Legislature to
1004    provide for the administration of this program. The payment of
1005    the contributions to the optional program which is required by
1006    this subparagraph for each participant shall be made by the
1007    employer to the divisiondepartment, which shall forward the
1008    contributions to the designated company or companies contracting
1009    for payment of benefits for the participant under the program.
1010          2. Each employer shall contribute on behalf of each
1011    participant in the Senior Management Service Optional Annuity
1012    Program an amount equal to the unfunded actuarial accrued
1013    liability portion of the employer contribution which would be
1014    required for members of the Senior Management Service Class in
1015    the Florida Retirement System. This contribution shall be paid
1016    to the divisiondepartmentfor transfer to the Florida
1017    Retirement System Trust Fund.
1018          3. An Optional Annuity Program Trust Fund shall be
1019    established in the State Treasury and administered by the
1020    divisiondepartmentto make payments to provider companies on
1021    behalf of the optional annuity program participants, and to
1022    transfer the unfunded liability portion of the state optional
1023    annuity program contributions to the Florida Retirement System
1024    Trust Fund.
1025          4. Contributions required for social security by each
1026    employer and each participant, in the amount required for social
1027    security coverage as now or hereafter may be provided by the
1028    federal Social Security Act shall be maintained for each
1029    participant in the Senior Management Service retirement program
1030    and shall be in addition to the retirement contributions
1031    specified in this paragraph.
1032          5. Each participant in the Senior Management Service
1033    Optional Annuity Program may contribute by way of salary
1034    reduction or deduction a percentage amount of the participant's
1035    gross compensation not to exceed the percentage amount
1036    contributed by the employer to the optional annuity program.
1037    Payment of the participant's contributions shall be made by the
1038    employer to the divisiondepartment, which shall forward the
1039    contributions to the designated company or companies contracting
1040    for payment of benefits for the participant under the program.
1041          (f) Administration.--
1042          1. The Senior Management Service Optional Annuity Program
1043    authorized by this section shall be administered by the division
1044    department. The divisiondepartmentshall designate one or more
1045    provider companies from which annuity contracts may be purchased
1046    under the program and shall approve the form and content of the
1047    contracts. The divisiondepartmentshall sign a contract with
1048    each of the provider companies and shall evaluate the
1049    performance of the provider companies on a continuing basis. The
1050    divisiondepartmentmay terminate the services of a provider
1051    company for reasons stated in the contract. The division
1052    departmentshall adopt rules establishing its responsibilities
1053    and the responsibilities of employers in administering the
1054    optional annuity program.
1055          2. Effective July 1, 1997, the State Board of
1056    Administration shall review and make recommendations to the
1057    divisiondepartmenton the acceptability of all investment
1058    products proposed by provider companies of the optional annuity
1059    program before such products are offered through annuity
1060    contracts to the participants and may advise the division
1061    departmentof any changes deemed necessary to ensure that the
1062    optional annuity program offers an acceptable mix of investment
1063    products. The divisiondepartmentshall make the final
1064    determination as to whether an investment product will be
1065    approved for the program.
1066          3. The provisions of each contract applicable to a
1067    participant in the Senior Management Service Optional Annuity
1068    Program shall be contained in a written program description
1069    which shall include a report of pertinent financial and
1070    actuarial information on the solvency and actuarial soundness of
1071    the program and the benefits applicable to the participant. Such
1072    description shall be furnished by the company or companies to
1073    each participant in the program and to the divisiondepartment
1074    upon commencement of participation in the program and annually
1075    thereafter.
1076          4. The divisiondepartmentshall ensure that each
1077    participant in the Senior Management Service Optional Annuity
1078    Program is provided an accounting of the total contribution and
1079    the annual contribution made by and on behalf of such
1080    participants.
1081          Section 28. Paragraph (h) of subsection (1) and paragraph
1082    (e) of subsection (2) of section 121.081, Florida Statutes, are
1083    amended to read:
1084          121.081 Past service; prior service;
1085    contributions.--Conditions under which past service or prior
1086    service may be claimed and credited are:
1087          (1)
1088          (h) The following provisions apply to the purchase of past
1089    service:
1090          1. Notwithstanding any of the provisions of this
1091    subsection, past-service credit may not be purchased under this
1092    chapter for any service that is used to obtain a benefit from
1093    any local retirement system.
1094          2. A member may not receive past service credit under
1095    paragraphs (a), (b), (e), or (f) for any leaves of absence
1096    without pay, except that credit for active military service
1097    leaves of absence may be claimed under paragraphs (a), (b), and
1098    (f), in accordance with s. 121.111(1).
1099          3. If a member does not desire to receive credit for all
1100    of his or her past service, the period the member claims must be
1101    the most recent past service prior to his or her participation
1102    in the Florida Retirement System.
1103          4. The cost of past service purchased by an employing
1104    agency for its employees may be amortized over such period of
1105    time as is provided in the agreement, but not to exceed 15
1106    years, calculated in accordance with rule 60S-1.007(5)(f),
1107    Florida Administrative Code.
1108          5. The retirement account of each member for whom past
1109    service is being provided by his or her employer shall be
1110    credited with all past service the employer agrees to purchase
1111    as soon as the agreement between the employer and the division
1112    departmentis executed. Pursuant thereto:
1113          a. Each such member's account shall also be posted with
1114    the total contribution his or her employer agrees to make in the
1115    member's behalf for past service earned prior to October 1,
1116    1975, excluding those contributions representing the employer's
1117    matching share and the compound interest calculation on the
1118    total contribution. However, a portion of any contributions paid
1119    by an employer for past service credit earned on and after
1120    October 1, 1975, may not be posted to a member's account.
1121          b. A refund of contributions payable after an employer has
1122    made a written agreement to purchase past service for employees
1123    of the covered group shall include contributions for past
1124    service which are posted to a member's account. However,
1125    contributions for past service earned on and after October 1,
1126    1975, are not refundable.
1127          (2) Prior service, as defined in s. 121.021(19), may be
1128    claimed as creditable service under the Florida Retirement
1129    System after a member has been reemployed for 1 complete year of
1130    creditable service within a period of 12 consecutive months,
1131    except as provided in paragraph (c). Service performed as a
1132    participant of the optional retirement program for the State
1133    University System under s. 121.35 or the Senior Management
1134    Service Optional Annuity Program under s. 121.055 may be used to
1135    satisfy the reemployment requirement of 1 complete year of
1136    creditable service. The member shall not be permitted to make
1137    any contributions for prior service until after completion of
1138    the 1 year of creditable service. If a member does not wish to
1139    claim credit for all of his or her prior service, the service
1140    the member claims must be the most recent period of service. The
1141    required contributions for claiming the various types of prior
1142    service are:
1143          (e) For service performed under the Florida Retirement
1144    System after December 1, 1970, that was never reported to the
1145    division or the departmentdue to error, retirement credit may
1146    be claimed by a member of the Florida Retirement System. The
1147    divisiondepartmentshall adopt rules establishing criteria for
1148    claiming such credit and detailing the documentation required to
1149    substantiate the error.
1150          Section 29. Subsection (1) of section 121.085, Florida
1151    Statutes, is amended to read:
1152          121.085 Creditable service.--The following provisions
1153    shall apply to creditable service as defined in s. 121.021(17):
1154          (1) The divisiondepartmentshall adopt rules establishing
1155    procedures for the submission of evidence or information
1156    necessary to establish a member's claim of creditable service.
1157          Section 30. Section 121.091, Florida Statutes, is amended
1158    to read:
1159          121.091 Benefits payable under the system.--Benefits may
1160    not be paid under this section unless the member has terminated
1161    employment as provided in s. 121.021(39)(a) or begun
1162    participation in the Deferred Retirement Option Program as
1163    provided in subsection (13), and a proper application has been
1164    filed in the manner prescribed by the divisiondepartment. The
1165    divisiondepartmentmay cancel an application for retirement
1166    benefits when the member or beneficiary fails to timely provide
1167    the information and documents required by this chapter and the
1168    division'sdepartment's rules. The divisiondepartmentshall
1169    adopt rules establishing procedures for application for
1170    retirement benefits and for the cancellation of such application
1171    when the required information or documents are not received.
1172          (1) NORMAL RETIREMENT BENEFIT.--Upon attaining his or her
1173    normal retirement date, the member, upon application to the
1174    administrator, shall receive a monthly benefit which shall begin
1175    to accrue on the first day of the month of retirement and be
1176    payable on the last day of that month and each month thereafter
1177    during his or her lifetime. The normal retirement benefit,
1178    including any past or additional retirement credit, may not
1179    exceed 100 percent of the average final compensation. The amount
1180    of monthly benefit shall be calculated as the product of A and
1181    B, subject to the adjustment of C, if applicable, as set forth
1182    below:
1183          (a)1. For creditable years of Regular Class service, A is
1184    1.60 percent of the member's average final compensation, up to
1185    the member's normal retirement date. Upon completion of the
1186    first year after the normal retirement date, A is 1.63 percent
1187    of the member's average final compensation. Following the second
1188    year after the normal retirement date, A is 1.65 percent of the
1189    member's average final compensation. Following the third year
1190    after the normal retirement date, and for subsequent years, A is
1191    1.68 percent of the member's average final compensation.
1192          2. For creditable years of special risk service, A is:
1193          a. Two percent of the member's average final compensation
1194    for all creditable years prior to October 1, 1974;
1195          b. Three percent of the member's average final
1196    compensation for all creditable years after September 30, 1974,
1197    and before October 1, 1978;
1198          c. Two percent of the member's average final compensation
1199    for all creditable years after September 30, 1978, and before
1200    January 1, 1989;
1201          d. Two and two-tenths percent of the member's final
1202    monthly compensation for all creditable years after December 31,
1203    1988, and before January 1, 1990;
1204          e. Two and four-tenths percent of the member's average
1205    final compensation for all creditable years after December 31,
1206    1989, and before January 1, 1991;
1207          f. Two and six-tenths percent of the member's average
1208    final compensation for all creditable years after December 31,
1209    1990, and before January 1, 1992;
1210          g. Two and eight-tenths percent of the member's average
1211    final compensation for all creditable years after December 31,
1212    1991, and before January 1, 1993;
1213          h. Three percent of the member's average final
1214    compensation for all creditable years after December 31, 1992;
1215    and
1216          i. Three percent of the member's average final
1217    compensation for all creditable years of service after September
1218    30, 1978, and before January 1, 1993, for any special risk
1219    member who retires after July 1, 2000, or any member of the
1220    Special Risk Administrative Support Class entitled to retain the
1221    special risk normal retirement date who was a member of the
1222    Special Risk Class during the time period and who retires after
1223    July 1, 2000.
1224          3. For creditable years of Senior Management Service Class
1225    service after January 31, 1987, A is 2 percent;
1226          4. For creditable years of Elected Officers' Class service
1227    as a Supreme Court Justice, district court of appeal judge,
1228    circuit judge, or county court judge, A is 31/3 percent of the
1229    member's average final compensation, and for all other
1230    creditable service in such class, A is 3 percent of average
1231    final compensation;
1232          (b) B is the number of the member's years and any
1233    fractional part of a year of creditable service earned
1234    subsequent to November 30, 1970; and
1235          (c) C is the normal retirement benefit credit brought
1236    forward as of November 30, 1970, by a former member of an
1237    existing system. Such normal retirement benefit credit shall be
1238    determined as the product of X and Y when X is the percentage of
1239    average final compensation which the member would have been
1240    eligible to receive if the member had attained his or her normal
1241    retirement date as of November 30, 1970, all in accordance with
1242    the existing system under which the member is covered on
1243    November 30, 1970, and Y is average final compensation as
1244    defined in s. 121.021(25). However, any member of an existing
1245    retirement system who is eligible to retire and who does retire,
1246    become disabled, or die prior to April 15, 1971, may have his or
1247    her retirement benefits calculated on the basis of the best 5 of
1248    the last 10 years of service.
1249          (d) A member's average final compensation shall be
1250    determined by formula to obtain the coverage for the 5 highest
1251    fiscal years' salaries, calculated as provided by rule.
1252          (2) BENEFITS PAYABLE FOR DUAL NORMAL RETIREMENT AGES.--If
1253    a member accumulates retirement benefits to commence at
1254    different normal retirement ages by virtue of having performed
1255    duties for an employer which would entitle him or her to
1256    benefits as both a member of the Special Risk Class and a member
1257    of either the Regular Class, Senior Management Service Class, or
1258    Elected Officers' Class, the amount of benefits payable shall be
1259    computed separately with respect to each such age and the sum of
1260    such computed amounts shall be paid as provided in this section.
1261          (3) EARLY RETIREMENT BENEFIT.--Upon retirement on his or
1262    her early retirement date, the member shall receive an immediate
1263    monthly benefit that shall begin to accrue on the first day of
1264    the month of the retirement date and be payable on the last day
1265    of that month and each month thereafter during his or her
1266    lifetime. Such benefit shall be calculated as follows:
1267          (a) The amount of each monthly payment shall be computed
1268    in the same manner as for a normal retirement benefit, in
1269    accordance with subsection (1), but shall be based on the
1270    member's average monthly compensation and creditable service as
1271    of the member's early retirement date. The benefit so computed
1272    shall be reduced by five-twelfths of 1 percent for each complete
1273    month by which the early retirement date precedes the normal
1274    retirement date of age 62 for a member of the Regular Class,
1275    Senior Management Service Class, or the Elected Officers' Class,
1276    and age 55 for a member of the Special Risk Class, or age 52 if
1277    a Special Risk member has completed 25 years of creditable
1278    service in accordance with s. 121.021(29)(b)3.
1279          (b) If the employment of a member is terminated by reason
1280    of death subsequent to the completion of 20 years of creditable
1281    service, the monthly benefit payable to the member's beneficiary
1282    shall be calculated in accordance with subsection (1), but shall
1283    be based on average monthly compensation and creditable service
1284    as of the date of death. The benefit so computed shall be
1285    reduced by five-twelfths of 1 percent for each complete month by
1286    which death precedes the normal retirement date specified above
1287    or the date on which the member would have attained 30 years of
1288    creditable service had he or she survived and continued his or
1289    her employment, whichever provides a higher benefit.
1290          (4) DISABILITY RETIREMENT BENEFIT.--
1291          (a) Disability retirement; entitlement and effective
1292    date.--
1293          1.a. A member who becomes totally and permanently
1294    disabled, as defined in paragraph (b), after completing 5 years
1295    of creditable service, or a member who becomes totally and
1296    permanently disabled in the line of duty regardless of service,
1297    shall be entitled to a monthly disability benefit; except that
1298    any member with less than 5 years of creditable service on July
1299    1, 1980, or any person who becomes a member of the Florida
1300    Retirement System on or after such date must have completed 10
1301    years of creditable service prior to becoming totally and
1302    permanently disabled in order to receive disability retirement
1303    benefits for any disability which occurs other than in the line
1304    of duty. However, if a member employed on July 1, 1980, with
1305    less than 5 years of creditable service as of that date, becomes
1306    totally and permanently disabled after completing 5 years of
1307    creditable service and is found not to have attained fully
1308    insured status for benefits under the federal Social Security
1309    Act, such member shall be entitled to a monthly disability
1310    benefit.
1311          b. Effective July 1, 2001, a member of the defined benefit
1312    retirement program who becomes totally and permanently disabled,
1313    as defined in paragraph (b), after completing 8 years of
1314    creditable service, or a member who becomes totally and
1315    permanently disabled in the line of duty regardless of service,
1316    shall be entitled to a monthly disability benefit.
1317          2. If the division has received from the employer the
1318    required documentation of the member's termination of
1319    employment, the effective retirement date for a member who
1320    applies and is approved for disability retirement shall be
1321    established by rule of the division.
1322          3. For a member who is receiving Workers' Compensation
1323    payments, the effective disability retirement date may not
1324    precede the date the member reaches Maximum Medical Improvement
1325    (MMI), unless the member terminates employment prior to reaching
1326    MMI.
1327          (b) Total and permanent disability.--A member shall be
1328    considered totally and permanently disabled if, in the opinion
1329    of the administrator, he or she is prevented, by reason of a
1330    medically determinable physical or mental impairment, from
1331    rendering useful and efficient service as an officer or
1332    employee.
1333          (c) Proof of disability.--The administrator, before
1334    approving payment of any disability retirement benefit, shall
1335    require proof that the member is totally and permanently
1336    disabled as provided herein:
1337          1. Such proof shall include the certification of the
1338    member's total and permanent disability by two licensed
1339    physicians of the state and such other evidence of disability as
1340    the administrator may require, including reports from vocational
1341    rehabilitation, evaluation, or testing specialists who have
1342    evaluated the applicant for employment.
1343          2. It must be documented that:
1344          a. The member's medical condition occurred or became
1345    symptomatic during the time the member was employed in an
1346    employee/employer relationship with his or her employer;
1347          b. The member was totally and permanently disabled at the
1348    time he or she terminated covered employment; and
1349          c. The member has not been employed with any other
1350    employer after such termination.
1351          3. If the application is for in-line-of-duty disability,
1352    in addition to the requirements of subparagraph 2., it must be
1353    documented by competent medical evidence that the disability was
1354    caused by a job-related illness or accident which occurred while
1355    the member was in an employee/employer relationship with his or
1356    her employer.
1357          4. The unavailability of an employment position that the
1358    member is physically and mentally capable of performing will not
1359    be considered as proof of total and permanent disability.
1360          (d) Election on appeal.--A member whose application for
1361    regular disability retirement has been denied and who has filed
1362    an appeal to the State Retirement Commission may, if eligible,
1363    elect to receive normal or early service retirement benefits
1364    while he or she is awaiting the decision on the appeal. However:
1365          1. If the member elects to receive service retirement
1366    benefits and disability benefits are later approved as a result
1367    of the appeal, the payment option chosen by the member may not
1368    be changed.
1369          2. If the member elects to receive early service
1370    retirement and the appeal is later denied, the member may not
1371    change his or her election of early retirement.
1372         
1373          Before such regular or early retirement benefits may be paid by
1374    the division, the member must provide to the division a written
1375    statement indicating that the member understands that such
1376    changes are not permitted after he or she begins receiving the
1377    benefits.
1378          (e) Disability retirement benefit.--Upon the retirement of
1379    a member on his or her disability retirement date, the member
1380    shall receive a monthly benefit that shall begin to accrue on
1381    the first day of the month of disability retirement and shall be
1382    payable on the last day of that month and each month thereafter
1383    during his or her lifetime and continued disability.
1384          (f) Computation of disability retirement benefit.--The
1385    amount of each monthly payment shall be computed in the same
1386    manner as for a normal retirement benefit, in accordance with
1387    subsection (1), but shall be based on disability option
1388    actuarial equivalency tables and the average monthly
1389    compensation and creditable service of the member as of the
1390    disability retirement date, subject to the following conditions:
1391          1. If the member's disability occurred in the line of
1392    duty, the monthly Option 1 benefit shall not be less than:
1393          a. Forty-two percent of average monthly compensation as of
1394    the disability retirement date; or
1395          b. Sixty-five percent of the average monthly compensation
1396    as of the disability retirement date for a member of the special
1397    risk class who retires on or after July 1, 2000; or
1398          2. If the member's disability occurred other than in the
1399    line of duty, the monthly Option 1 benefit shall not be less
1400    than 25 percent of average monthly compensation as of the
1401    disability retirement date.
1402          (g) Reapplication.--A member, whose initial application
1403    for disability retirement has been denied, may reapply for
1404    disability benefits. However, such member's reapplication will
1405    be considered only if the member presents new medical evidence
1406    of a medical condition that existed prior to the member's
1407    termination of employment. The division may prescribe by rule
1408    procedures for reapplication and for review and approval or
1409    disapproval of reapplication.
1410          (h) Recovery from disability.--The administrator may
1411    require periodic reexaminations at the expense of the retirement
1412    fund. The division may adopt rules establishing procedures for
1413    conducting and review of such reexaminations.
1414          1. If the administrator finds that a member who is
1415    receiving disability benefits is, at any time prior to his or
1416    her normal retirement date, no longer disabled, the
1417    administrator shall direct that the benefits be discontinued.
1418    The decision of the administrator on this question shall be
1419    final and binding. If such member:
1420          a. Does not reenter the employ of an employer and was not
1421    vested as of the disability retirement date, he or she shall be
1422    entitled to the excess, if any, of his or her accumulated
1423    contributions over the total disability benefits received up to
1424    the date of recovery.
1425          b. Does not reenter the employ of an employer, but was
1426    vested as of the disability retirement date, he or she may elect
1427    to receive:
1428          (I) The excess, if any, of his or her accumulated
1429    contributions over the total disability benefits received up to
1430    the date of recovery; or
1431          (II) A deferred benefit commencing on the last day of the
1432    month of the normal retirement date which shall be payable on
1433    the last day of the month thereafter during his or her lifetime.
1434    The amount of such monthly benefit shall be computed in the same
1435    manner as for a normal retirement benefit, in accordance with
1436    subsection (1), but shall be based on average monthly
1437    compensation and creditable service as of the member's
1438    disability retirement date.
1439          c. Reenters employment of an employer within 6 months
1440    after recovery, the member's service will be deemed to have been
1441    continuous, but the period beginning with the first month for
1442    which he or she received a disability benefit payment and ending
1443    with the date he or she reentered employment will not be
1444    considered as creditable service for the purpose of computing
1445    benefits except as provided in sub-subparagraph d. As used in
1446    this section, the term "accumulated contributions" for such
1447    member means the excess of the member's accumulated
1448    contributions as of the disability retirement date over the
1449    total disability benefits received under paragraph (e).
1450          d. Terminates his or her disability benefit, reenters
1451    covered employment, and is continuously employed for a minimum
1452    of 1 year of creditable service, he or she may claim as
1453    creditable service the months during which he or she was
1454    receiving a disability benefit, upon payment of the required
1455    contributions. Contributions shall equal the total required
1456    employee and employer contribution rate applicable during the
1457    period the retiree received retirement benefits, multiplied
1458    times his or her rate of monthly compensation prior to the
1459    commencement of disability retirement for each month of the
1460    period claimed, plus 4 percent interest until July 1, 1975, and
1461    6.5 percent interest thereafter, compounded annually each June
1462    30 to the date of payment. If the member does not claim credit
1463    for all of the months he or she received disability benefits,
1464    the months claimed must be the most recent months of retirement.
1465    Such credit for periods of disability, when purchased under the
1466    Florida Retirement System, shall apply toward vesting
1467    requirements for eligibility to purchase additional credit for
1468    other service.
1469          2. Both the member receiving disability benefits who
1470    reenters employment and the employer employing such disability
1471    retiree shall notify the division immediately upon reemployment,
1472    and the division shall terminate such member's disability
1473    benefits, effective the first day of the month following the
1474    month in which notification of recovery is received. If the
1475    member is reemployed with a Florida Retirement System employer
1476    at the time of benefit termination, and he or she has received
1477    disability retirement benefit and salary payments concurrently
1478    prior to notifying the division, he or she may elect within 30
1479    days to:
1480          a. Retain the retirement benefits received prior to
1481    termination of disability benefits and begin receiving
1482    retirement service credit effective upon the date of termination
1483    of benefits; or
1484          b. Repay, within 12 months after his or her decision to
1485    receive service credit, the retirement benefits received for
1486    each month of reemployment prior to termination of disability
1487    benefits and begin receiving retirement service credit effective
1488    upon the date of reemployment. Any such unpaid benefits shall
1489    have compound interest of 6.5 percent added June 30.
1490         
1491          A member may not receive both retirement service credit for
1492    employment and retirement benefits for the same month.
1493          3. If, after recovery of disability and reentry into
1494    covered employment, the member again becomes disabled and is
1495    again approved for disability retirement, the Option 1 monthly
1496    retirement benefit shall not be less than the Option 1 monthly
1497    benefit calculated at the time of the previous disability, plus
1498    any cost of living increases up to the time the disability
1499    benefit was terminated upon his or her reentry into covered
1500    employment.
1501          (i) Nonadmissible causes of disability.--A member shall
1502    not be entitled to receive any disability retirement benefit if
1503    the disability is a result of any of the following:
1504          1. Injury or disease sustained by the member while
1505    willfully participating in a riot, civil insurrection, or other
1506    act of violence or while committing a felony;
1507          2. Injury or disease sustained by the member after his or
1508    her employment has terminated; or
1509          3. Intentional, self-inflicted injury.
1510          (j) Disability retirement of justice or judge by order of
1511    Supreme Court.--
1512          1. If a member is a justice of the Supreme Court, judge of
1513    a district court of appeal, circuit judge, or judge of a county
1514    court who has served for 6 years or more as an elected
1515    constitutional judicial officer, including service as a judicial
1516    officer in any court abolished pursuant to Art. V of the State
1517    Constitution, and who is retired for disability by order of the
1518    Supreme Court upon recommendation of the Judicial Qualifications
1519    Commission pursuant to the provisions of Art. V of the State
1520    Constitution, the member's Option 1 monthly benefit as provided
1521    in subparagraph (6)(a)1. shall not be less than two-thirds of
1522    his or her monthly compensation as of the member's disability
1523    retirement date. Such a member may alternatively elect to
1524    receive a disability retirement benefit under any other option
1525    as provided in paragraph (6)(a).
1526          2. Should any justice or judge who is a member of the
1527    Florida Retirement System be retired for disability by order of
1528    the Supreme Court upon recommendation of the Judicial
1529    Qualifications Commission pursuant to the provisions of Art. V
1530    of the State Constitution, then all contributions to his or her
1531    account and all contributions made on his or her behalf by the
1532    employer shall be transferred to and deposited in the General
1533    Revenue Fund of the state, and there is hereby appropriated
1534    annually out of the General Revenue Fund, to be paid into the
1535    Florida Retirement System Fund, an amount necessary to pay the
1536    benefits of all justices and judges retired from the Florida
1537    Retirement System pursuant to Art. V of the State Constitution.
1538          (5) TERMINATION BENEFITS.--A member whose employment is
1539    terminated prior to retirement retains membership rights to
1540    previously earned member-noncontributory service credit, and to
1541    member-contributory service credit, if the member leaves the
1542    member contributions on deposit in his or her retirement
1543    account. If a terminated member receives a refund of member
1544    contributions, such member may reinstate membership rights to
1545    the previously earned service credit represented by the refund
1546    by completing 1 year of creditable service and repaying the
1547    refunded member contributions, plus interest.
1548          (a) A member whose employment is terminated for any reason
1549    other than death or retirement prior to becoming vested is
1550    entitled to the return of his or her accumulated contributions
1551    as of the date of termination.
1552          (b) A member whose employment is terminated for any reason
1553    other than death or retirement after becoming vested may elect
1554    to receive a deferred monthly benefit which shall begin to
1555    accrue on the first day of the month of normal or early
1556    retirement and shall be payable on the last day of that month
1557    and each month thereafter during his or her lifetime. The amount
1558    of monthly benefit shall be computed in the same manner as for a
1559    normal retirement benefit in accordance with subsection (1) or
1560    early retirement benefit in accordance with s. 121.021(30), but
1561    based on average monthly compensation and creditable service as
1562    of the date of termination.
1563          (c) In lieu of the deferred monthly benefit provided in
1564    paragraph (b), the terminated member may elect to receive a
1565    lump-sum amount equal to his or her accumulated contributions as
1566    of the date of termination.
1567          (d) If any retired member dies without having received in
1568    benefit payments an amount equal to his or her accumulated
1569    contributions, there shall be payable to his or her designated
1570    beneficiary an amount equal to the excess, if any, of the
1571    member's accumulated contributions over the total monthly
1572    payments made to the member prior to the date of death.
1573          (e) A member shall be deemed a terminated member when
1574    termination of employment has occurred as provided in s.
1575    121.021(39).
1576          (f) Any member who has been found guilty by a verdict of a
1577    jury, or by the court trying the case without a jury, of
1578    committing, aiding, or abetting any embezzlement or theft from
1579    his or her employer, bribery in connection with the employment,
1580    or other felony specified in chapter 838, except ss. 838.15 and
1581    838.16, committed prior to retirement, or who has entered a plea
1582    of guilty or of nolo contendere to such crime, or any member
1583    whose employment is terminated by reason of the member's
1584    admitted commitment, aiding, or abetting of an embezzlement or
1585    theft from his or her employer, bribery, or other felony
1586    specified in chapter 838, except ss. 838.15 and 838.16, shall
1587    forfeit all rights and benefits under this chapter, except the
1588    return of his or her accumulated contributions as of the date of
1589    termination.
1590          (g) Any elected official who is convicted by the Senate of
1591    an impeachable offense shall forfeit all rights and benefits
1592    under this chapter, except the return of his or her accumulated
1593    contributions as of the date of the conviction.
1594          (h) Any member who, prior to retirement, is adjudged by a
1595    court of competent jurisdiction to have violated any state law
1596    against strikes by public employees, or who has been found
1597    guilty by such court of violating any state law prohibiting
1598    strikes by public employees, shall forfeit all rights and
1599    benefits under this chapter, except the return of his or her
1600    accumulated contributions as of the date of the conviction.
1601          (i) Any beneficiary who by a verdict of a jury or by the
1602    court trying the case without a jury is found guilty, or who has
1603    entered a plea of guilty or nolo contendere, of unlawfully and
1604    intentionally killing or procuring the death of the member
1605    forfeits all rights to the deceased member's benefits under this
1606    chapter, and the benefits will be paid as if such beneficiary
1607    had predeceased the decedent.
1608          (j) Benefits shall not be paid by the division pending
1609    final resolution of such charges against a member or beneficiary
1610    if the resolution of such charges could require the forfeiture
1611    of benefits as provided in paragraph (f), paragraph (g),
1612    paragraph (h), or paragraph (i).
1613          (6) OPTIONAL FORMS OF RETIREMENT BENEFITS AND DISABILITY
1614    RETIREMENT BENEFITS.--
1615          (a) Prior to the receipt of the first monthly retirement
1616    payment, a member shall elect to receive the retirement benefits
1617    to which he or she is entitled under subsection (1), subsection
1618    (2), subsection (3), or subsection (4) in accordance with one of
1619    the following options:
1620          1. The maximum retirement benefit payable to the member
1621    during his or her lifetime.
1622          2. A decreased retirement benefit payable to the member
1623    during his or her lifetime and, in the event of his or her death
1624    within a period of 10 years after retirement, the same monthly
1625    amount payable for the balance of such 10-year period to his or
1626    her beneficiary or, in case the beneficiary is deceased, in
1627    accordance with subsection (8) as though no beneficiary had been
1628    named.
1629          3. A decreased retirement benefit payable during the joint
1630    lifetime of both the member and his or her joint annuitant and
1631    which, after the death of either, shall continue during the
1632    lifetime of the survivor in the same amount, subject to the
1633    provisions of subsection (12).
1634          4. A decreased retirement benefit payable during the joint
1635    lifetime of the member and his or her joint annuitant and which,
1636    after the death of either, shall continue during the lifetime of
1637    the survivor in an amount equal to 662/3 percent of the amount
1638    that was payable during the joint lifetime of the member and his
1639    or her joint annuitant, subject to the provisions of subsection
1640    (12).
1641         
1642          The spouse of any member who elects to receive the benefit
1643    provided under subparagraph 1. or subparagraph 2. shall be
1644    notified of and shall acknowledge any such election. The
1645    division shall establish by rule a method for selecting the
1646    appropriate actuarial factor for optional forms of benefits
1647    selected under subparagraphs 3. and 4., based on the age of the
1648    member and the joint annuitant.
1649          (b) The benefit payable under any option stated above
1650    shall be the actuarial equivalent, based on tables adopted by
1651    the administrator for this purpose, of the amount to which the
1652    member was otherwise entitled.
1653          (c) A member who elects the option in subparagraph (a)2.
1654    shall, in accordance with subsection (8), designate one or more
1655    persons to receive the benefits payable in the event of his or
1656    her death. Such persons shall be the beneficiaries of the
1657    member. The member may also designate one or more contingent
1658    beneficiaries to receive any benefits remaining upon the death
1659    of the primary beneficiary.
1660          (d) A member who elects the option in subparagraph (a)3.
1661    or subparagraph (a)4. shall, on a form provided for that
1662    purpose, designate a joint annuitant to receive the benefits
1663    which continue to be payable upon the death of the member. After
1664    benefits have commenced under the option in subparagraph (a)3.
1665    or subparagraph (a)4., the following shall apply:
1666          1. A retired member may change his or her designation of a
1667    joint annuitant only twice. If such a retired member desires to
1668    change his or her designation of a joint annuitant, he or she
1669    shall file with the division a notarized "change of joint
1670    annuitant" form and shall notify the former joint annuitant in
1671    writing of such change. Effective the first day of the next
1672    month following receipt by the division of a completed change of
1673    joint annuitant form, the division shall adjust the member's
1674    monthly benefit by the application of actuarial tables and
1675    calculations developed to ensure that the benefit paid is the
1676    actuarial equivalent of the present value of the member's
1677    current benefit. The consent of a retired member's first
1678    designated joint annuitant to any such change shall not be
1679    required. However, if either the member or the joint annuitant
1680    dies before the effective date of the request for change of
1681    joint annuitant, the requested change shall be void, and
1682    survivor benefits, if any, shall be paid as if no request had
1683    been made.
1684          2. In the event of the dissolution of marriage of a
1685    retired member and a joint annuitant, such member may make an
1686    election to nullify the joint annuitant designation of the
1687    former spouse, unless there is an existing qualified domestic
1688    relations order preventing such action. The member shall file
1689    with the division a written, notarized nullification which shall
1690    be effective on the first day of the next month following
1691    receipt by the division. Benefits shall be paid as if the former
1692    spouse predeceased the member. A member who makes such an
1693    election may not reverse the nullification but may designate a
1694    new joint annuitant in accordance with subparagraph 1.
1695          (e) The election of an option shall be null and void if
1696    the member dies before the effective date of retirement.
1697          (f) A member who elects to receive benefits under the
1698    option in subparagraph (a)3. may designate one or more qualified
1699    persons, either a spouse or other dependent, as his or her joint
1700    annuitant to receive the benefits after the member's death in
1701    whatever proportion he or she so assigns to each person named as
1702    joint annuitant. The division shall adopt appropriate actuarial
1703    tables and calculations necessary to ensure that the benefit
1704    paid is the actuarial equivalent of the benefit to which the
1705    member is otherwise entitled under the option in subparagraph
1706    (a)1.
1707          (g) Upon the death of a retired member or beneficiary
1708    receiving monthly benefits under this chapter, the monthly
1709    benefits shall be paid through the last day of the month of
1710    death and shall terminate, or be adjusted, if applicable, as of
1711    that date in accordance with the optional form of benefit
1712    selected at the time of retirement.
1713          (h) The option selected or determined for payment of
1714    benefits as provided in this section shall be final and
1715    irrevocable at the time a benefit payment is cashed or deposited
1716    or credited to the Deferred Retirement Option Program as
1717    provided in subsection (13).
1718          (7) DEATH BENEFITS.--
1719          (a) If the employment of a member is terminated by reason
1720    of his or her death prior to being vested, except as provided in
1721    paragraph (f), there shall be payable to his or her designated
1722    beneficiary the member's accumulated contributions.
1723          (b) If the employment of an active member who may or may
1724    not have applied for retirement is terminated by reason of his
1725    or her death subsequent to becoming vested and prior to his or
1726    her effective date of retirement, if established, it shall be
1727    assumed that the member retired as of the date of death in
1728    accordance with subsection (1) if eligible for normal retirement
1729    benefits, subsection (2) if eligible for benefits payable for
1730    dual normal retirement, or subsection (3) if eligible for early
1731    retirement benefits. Benefits payable to the designated
1732    beneficiary shall be as follows:
1733          1. For a beneficiary who qualifies as a joint annuitant,
1734    the optional form of payment provided in accordance with
1735    subparagraph (6)(a)3. shall be paid for the joint annuitant's
1736    lifetime.
1737          2. For a beneficiary who does not qualify as a joint
1738    annuitant, no continuing monthly benefit shall be paid and the
1739    beneficiary shall be entitled only to the return of the member's
1740    personal contributions. If there is no monetary interest in the
1741    member's retirement account for which such beneficiary is
1742    eligible, the beneficiary shall be the next named beneficiary
1743    or, if no other beneficiary is named, the beneficiary shall be
1744    the next eligible beneficiary according to subsection (8).
1745          (c) If a retiring member dies on or after the effective
1746    date of retirement, but prior to a benefit payment being cashed
1747    or deposited, or credited to the Deferred Retirement Option
1748    Program, benefits shall be paid as follows:
1749          1. For a designated beneficiary who qualifies as a joint
1750    annuitant, benefits shall be paid in the optional form of
1751    payment provided in subparagraph (6)(a)3. for the joint
1752    annuitant's lifetime or, if the member chose the optional form
1753    of payment provided in subparagraph (6)(a)2., the joint
1754    annuitant may select the form provided in either subparagraph
1755    (6)(a)2. or subparagraph (6)(a)3.
1756          2. For a designated beneficiary who does not qualify as a
1757    joint annuitant, any benefits payable shall be paid as provided
1758    in the option selected by the member; or if the member has not
1759    selected an option, benefits shall be paid in the optional form
1760    of payment provided in subparagraph (6)(a)1.
1761          (d) Notwithstanding any other provision in this chapter to
1762    the contrary, with the exception of the Deferred Retirement
1763    Option Program, as provided in subsection (13):
1764          1. The surviving spouse of any member killed in the line
1765    of duty may receive a monthly pension equal to one-half of the
1766    monthly salary being received by the member at the time of death
1767    for the rest of the surviving spouse's lifetime or, if the
1768    member was vested, such surviving spouse may elect to receive a
1769    benefit as provided in paragraph (b). Benefits provided by this
1770    paragraph shall supersede any other distribution that may have
1771    been provided by the member's designation of beneficiary.
1772          2. If the surviving spouse of a member killed in the line
1773    of duty dies, the monthly payments which would have been payable
1774    to such surviving spouse had such surviving spouse lived shall
1775    be paid for the use and benefit of such member's child or
1776    children under 18 years of age and unmarried until the 18th
1777    birthday of the member's youngest child.
1778          3. If a member killed in the line of duty leaves no
1779    surviving spouse but is survived by a child or children under 18
1780    years of age, the benefits provided by subparagraph 1., normally
1781    payable to a surviving spouse, shall be paid for the use and
1782    benefit of such member's child or children under 18 years of age
1783    and unmarried until the 18th birthday of the member's youngest
1784    child.
1785          4. The surviving spouse of a member whose benefit
1786    terminated because of remarriage shall have the benefit
1787    reinstated beginning July 1, 1993, at an amount that would have
1788    been payable had the benefit not been terminated.
1789          (e) The surviving spouse or other dependent of any member,
1790    except a member who participated in the Deferred Retirement
1791    Option Program, whose employment is terminated by death shall,
1792    upon application to the administrator, be permitted to pay the
1793    required contributions for any service performed by the member
1794    which could have been claimed by the member at the time of his
1795    or her death. Such service shall be added to the creditable
1796    service of the member and shall be used in the calculation of
1797    any benefits which may be payable to the surviving spouse or
1798    other surviving dependent.
1799          (f) Notwithstanding any other provisions in this chapter
1800    to the contrary and upon application to the administrator, an
1801    eligible joint annuitant, of a member whose employment is
1802    terminated by death within 1 year of such member satisfying the
1803    service requirements for vesting and retirement eligibility,
1804    shall be permitted to purchase only the additional service
1805    credit necessary to vest and qualify for retirement benefits,
1806    not to exceed a total of 1 year of credit, by one or a
1807    combination of the following methods:
1808          1. Such eligible joint annuitant may use the deceased
1809    member's accumulated hours of annual, sick, and compensatory
1810    leave to purchase additional creditable service, on an hour by
1811    hour basis, provided that such deceased member's accumulated
1812    leave is sufficient to cover the additional months required. For
1813    each month of service credit needed prior to the final month,
1814    credit for the total number of work hours in that month must be
1815    purchased, using an equal number of the deceased member's
1816    accumulated leave hours. Service credit required for the final
1817    month in which the deceased member would have become vested
1818    shall be awarded upon the purchase of 1 hour of credit. Such
1819    eligible joint annuitant shall pay the contribution rate in
1820    effect for the period of time being claimed for the deceased
1821    member's class of membership, multiplied by such member's
1822    monthly salary at the time of death, plus 6.5 percent interest
1823    compounded annually. The accumulated leave payment used in the
1824    average final compensation shall not include that portion of the
1825    payment that represents any leave hours used in the purchase of
1826    such creditable service.
1827          2. Such eligible joint annuitant may purchase additional
1828    months of creditable service for any periods of out-of-state
1829    service as provided in s. 121.1115, and in-state service as
1830    provided in s. 121.1122, that the deceased member would have
1831    been eligible to purchase prior to his or her death.
1832         
1833          Service purchased under this paragraph shall be added to the
1834    creditable service of the member and used to vest for retirement
1835    eligibility, and shall be used in the calculation of any
1836    benefits which may be payable to the eligible joint annuitant.
1837    Any benefits paid in accordance with this paragraph shall only
1838    be made prospectively.
1839          (g) Notwithstanding any other provisions in this chapter
1840    to the contrary, if any member who is vested dies and the
1841    surviving spouse receives a refund of the accumulated
1842    contributions made to the retirement trust fund, such spouse may
1843    pay to the Division of Retirement an amount equal to the sum of
1844    the amount of the deceased member's accumulated contributions
1845    previously refunded plus interest at 4 percent compounded
1846    annually each June 30 from the date of refund until July 1,
1847    1975, and 6.5 percent interest compounded annually thereafter,
1848    until full payment is made, and receive the monthly retirement
1849    benefit as provided in paragraph (b).
1850          (h) The designated beneficiary who is the surviving spouse
1851    or other dependent of a member whose employment is terminated by
1852    death subsequent to becoming vested, but prior to actual
1853    retirement, may elect to receive a deferred monthly benefit as
1854    if the member had lived and had elected a deferred monthly
1855    benefit, as provided in paragraph (5)(b), calculated on the
1856    basis of the average final compensation and creditable service
1857    of the member at his or her death and the age the member would
1858    have attained on the commencement date of the deferred benefit
1859    elected by the beneficiary, paid in accordance with option 3 of
1860    paragraph (6)(a).
1861          (8) DESIGNATION OF BENEFICIARIES.--
1862          (a) Each member may, on a form provided for that purpose,
1863    signed and filed with the division, designate a choice of one or
1864    more persons, named sequentially or jointly, as his or her
1865    beneficiary who shall receive the benefits, if any, which may be
1866    payable in the event of the member's death pursuant to the
1867    provisions of this chapter. If no beneficiary is named in the
1868    manner provided above, or if no beneficiary designated by the
1869    member survives the member, the beneficiary shall be the spouse
1870    of the deceased, if living. If the member's spouse is not alive
1871    at his or her death, the beneficiary shall be the living
1872    children of the member. If no children survive, the beneficiary
1873    shall be the member's father or mother, if living; otherwise,
1874    the beneficiary shall be the member's estate. The beneficiary
1875    most recently designated by a member on a form or letter filed
1876    with the division shall be the beneficiary entitled to any
1877    benefits payable at the time of the member's death, except that
1878    benefits shall be paid as provided in paragraph (7)(d) when
1879    death occurs in the line of duty. Notwithstanding any other
1880    provisions in this subsection to the contrary, for a member who
1881    dies prior to his or her effective date of retirement on or
1882    after January 1, 1999, the spouse at the time of death shall be
1883    the member's beneficiary unless such member designates a
1884    different beneficiary as provided herein subsequent to the
1885    member's most recent marriage.
1886          (b) A designated beneficiary of a retirement account for
1887    whom there is a monetary interest may disclaim his or her
1888    monetary interest as provided in s. 689.21, and in accordance
1889    with division rules governing such disclaimers. Such disclaimer
1890    must be filed within 24 months after the event that created the
1891    interest, that is, the death of the member or annuitant.
1892          (c) Notwithstanding the member's designation of benefits
1893    to be paid through a trust to a beneficiary that is a natural
1894    person as provided in s. 121.021(46), and notwithstanding the
1895    provisions of the trust, benefits shall be paid directly to the
1896    beneficiary if such person is no longer a minor or incapacitated
1897    as defined in s. 744.102(10) and (11).
1898          (9) EMPLOYMENT AFTER RETIREMENT; LIMITATION.--
1899          (a) Any person who is retired under this chapter, except
1900    under the disability retirement provisions of subsection (4),
1901    may be employed by an employer that does not participate in a
1902    state-administered retirement system and may receive
1903    compensation from that employment without limiting or
1904    restricting in any way the retirement benefits payable to that
1905    person.
1906          (b)1. Any person who is retired under this chapter, except
1907    under the disability retirement provisions of subsection (4),
1908    may be reemployed by any private or public employer after
1909    retirement and receive retirement benefits and compensation from
1910    his or her employer without any limitations, except that a
1911    person may not receive both a salary from reemployment with any
1912    agency participating in the Florida Retirement System and
1913    retirement benefits under this chapter for a period of 12 months
1914    immediately subsequent to the date of retirement. However, a
1915    DROP participant shall continue employment and receive a salary
1916    during the period of participation in the Deferred Retirement
1917    Option Program, as provided in subsection (13).
1918          2. Any person to whom the limitation in subparagraph 1.
1919    applies who violates such reemployment limitation and who is
1920    reemployed with any agency participating in the Florida
1921    Retirement System before completion of the 12-month limitation
1922    period shall give timely notice of this fact in writing to the
1923    employer and to the division and shall have his or her
1924    retirement benefits suspended for the balance of the 12-month
1925    limitation period. Any person employed in violation of this
1926    paragraph and any employing agency which knowingly employs or
1927    appoints such person without notifying the Division of
1928    Retirement to suspend retirement benefits shall be jointly and
1929    severally liable for reimbursement to the retirement trust fund
1930    of any benefits paid during the reemployment limitation period.
1931    To avoid liability, such employing agency shall have a written
1932    statement from the retiree that he or she is not retired from a
1933    state-administered retirement system. Any retirement benefits
1934    received while reemployed during this reemployment limitation
1935    period shall be repaid to the retirement trust fund, and
1936    retirement benefits shall remain suspended until such repayment
1937    has been made. Benefits suspended beyond the reemployment
1938    limitation shall apply toward repayment of benefits received in
1939    violation of the reemployment limitation.
1940          3. A district school board may reemploy a retired member
1941    as a substitute or hourly teacher, education paraprofessional,
1942    transportation assistant, bus driver, or food service worker on
1943    a noncontractual basis after he or she has been retired for 1
1944    calendar month, in accordance with s. 121.021(39). Any retired
1945    member who is reemployed within 1 calendar month after
1946    retirement shall void his or her application for retirement
1947    benefits. District school boards reemploying such teachers,
1948    education paraprofessionals, transportation assistants, bus
1949    drivers, or food service workers are subject to the retirement
1950    contribution required by subparagraph 7. Reemployment of a
1951    retired member as a substitute or hourly teacher, education
1952    paraprofessional, transportation assistant, bus driver, or food
1953    service worker is limited to 780 hours during the first 12
1954    months of his or her retirement. Any retired member reemployed
1955    for more than 780 hours during his or her first 12 months of
1956    retirement shall give timely notice in writing to the employer
1957    and to the division of the date he or she will exceed the
1958    limitation. The division shall suspend his or her retirement
1959    benefits for the remainder of the first 12 months of retirement.
1960    Any person employed in violation of this subparagraph and any
1961    employing agency which knowingly employs or appoints such person
1962    without notifying the Division of Retirement to suspend
1963    retirement benefits shall be jointly and severally liable for
1964    reimbursement to the retirement trust fund of any benefits paid
1965    during the reemployment limitation period. To avoid liability,
1966    such employing agency shall have a written statement from the
1967    retiree that he or she is not retired from a state-administered
1968    retirement system. Any retirement benefits received by a retired
1969    member while reemployed in excess of 780 hours during the first
1970    12 months of retirement shall be repaid to the Retirement System
1971    Trust Fund, and his or her retirement benefits shall remain
1972    suspended until repayment is made. Benefits suspended beyond the
1973    end of the retired member's first 12 months of retirement shall
1974    apply toward repayment of benefits received in violation of the
1975    780-hour reemployment limitation.
1976          4. A community college board of trustees may reemploy a
1977    retired member as an adjunct instructor, that is, an instructor
1978    who is noncontractual and part-time, or as a participant in a
1979    phased retirement program within the Florida Community College
1980    System, after he or she has been retired for 1 calendar month,
1981    in accordance with s. 121.021(39). Any retired member who is
1982    reemployed within 1 calendar month after retirement shall void
1983    his or her application for retirement benefits. Boards of
1984    trustees reemploying such instructors are subject to the
1985    retirement contribution required in subparagraph 7. A retired
1986    member may be reemployed as an adjunct instructor for no more
1987    than 780 hours during the first 12 months of retirement. Any
1988    retired member reemployed for more than 780 hours during the
1989    first 12 months of retirement shall give timely notice in
1990    writing to the employer and to the division of the date he or
1991    she will exceed the limitation. The division shall suspend his
1992    or her retirement benefits for the remainder of the first 12
1993    months of retirement. Any person employed in violation of this
1994    subparagraph and any employing agency which knowingly employs or
1995    appoints such person without notifying the Division of
1996    Retirement to suspend retirement benefits shall be jointly and
1997    severally liable for reimbursement to the retirement trust fund
1998    of any benefits paid during the reemployment limitation period.
1999    To avoid liability, such employing agency shall have a written
2000    statement from the retiree that he or she is not retired from a
2001    state-administered retirement system. Any retirement benefits
2002    received by a retired member while reemployed in excess of 780
2003    hours during the first 12 months of retirement shall be repaid
2004    to the Retirement System Trust Fund, and retirement benefits
2005    shall remain suspended until repayment is made. Benefits
2006    suspended beyond the end of the retired member's first 12 months
2007    of retirement shall apply toward repayment of benefits received
2008    in violation of the 780-hour reemployment limitation.
2009          5. The State University System may reemploy a retired
2010    member as an adjunct faculty member or as a participant in a
2011    phased retirement program within the State University System
2012    after the retired member has been retired for 1 calendar month,
2013    in accordance with s. 121.021(39). Any retired member who is
2014    reemployed within 1 calendar month after retirement shall void
2015    his or her application for retirement benefits. The State
2016    University System is subject to the retired contribution
2017    required in subparagraph 7., as appropriate. A retired member
2018    may be reemployed as an adjunct faculty member or a participant
2019    in a phased retirement program for no more than 780 hours during
2020    the first 12 months of his or her retirement. Any retired member
2021    reemployed for more than 780 hours during the first 12 months of
2022    retirement shall give timely notice in writing to the employer
2023    and to the division of the date he or she will exceed the
2024    limitation. The division shall suspend his or her retirement
2025    benefits for the remainder of the first 12 months of retirement.
2026    Any person employed in violation of this subparagraph and any
2027    employing agency which knowingly employs or appoints such person
2028    without notifying the Division of Retirement to suspend
2029    retirement benefits shall be jointly and severally liable for
2030    reimbursement to the retirement trust fund of any benefits paid
2031    during the reemployment limitation period. To avoid liability,
2032    such employing agency shall have a written statement from the
2033    retiree that he or she is not retired from a state-administered
2034    retirement system. Any retirement benefits received by a retired
2035    member while reemployed in excess of 780 hours during the first
2036    12 months of retirement shall be repaid to the Retirement System
2037    Trust Fund, and retirement benefits shall remain suspended until
2038    repayment is made. Benefits suspended beyond the end of the
2039    retired member's first 12 months of retirement shall apply
2040    toward repayment of benefits received in violation of the 780-
2041    hour reemployment limitation.
2042          6. The Board of Trustees of the Florida School for the
2043    Deaf and the Blind may reemploy a retired member as a substitute
2044    teacher, substitute residential instructor, or substitute nurse
2045    on a noncontractual basis after he or she has been retired for 1
2046    calendar month, in accordance with s. 121.021(39). Any retired
2047    member who is reemployed within 1 calendar month after
2048    retirement shall void his or her application for retirement
2049    benefits. The Board of Trustees of the Florida School for the
2050    Deaf and the Blind reemploying such teachers, residential
2051    instructors, or nurses is subject to the retirement contribution
2052    required by subparagraph 7. Reemployment of a retired member as
2053    a substitute teacher, substitute residential instructor, or
2054    substitute nurse is limited to 780 hours during the first 12
2055    months of his or her retirement. Any retired member reemployed
2056    for more than 780 hours during the first 12 months of retirement
2057    shall give timely notice in writing to the employer and to the
2058    division of the date he or she will exceed the limitation. The
2059    division shall suspend his or her retirement benefits for the
2060    remainder of the first 12 months of retirement. Any person
2061    employed in violation of this subparagraph and any employing
2062    agency which knowingly employs or appoints such person without
2063    notifying the Division of Retirement to suspend retirement
2064    benefits shall be jointly and severally liable for reimbursement
2065    to the retirement trust fund of any benefits paid during the
2066    reemployment limitation period. To avoid liability, such
2067    employing agency shall have a written statement from the retiree
2068    that he or she is not retired from a state-administered
2069    retirement system. Any retirement benefits received by a retired
2070    member while reemployed in excess of 780 hours during the first
2071    12 months of retirement shall be repaid to the Retirement System
2072    Trust Fund, and his or her retirement benefits shall remain
2073    suspended until payment is made. Benefits suspended beyond the
2074    end of the retired member's first 12 months of retirement shall
2075    apply toward repayment of benefits received in violation of the
2076    780-hour reemployment limitation.
2077          7. The employment by an employer of any retiree or DROP
2078    participant of any state-administered retirement system shall
2079    have no effect on the average final compensation or years of
2080    creditable service of the retiree or DROP participant. Prior to
2081    July 1, 1991, upon employment of any person, other than an
2082    elected officer as provided in s. 121.053, who has been retired
2083    under any state-administered retirement program, the employer
2084    shall pay retirement contributions in an amount equal to the
2085    unfunded actuarial liability portion of the employer
2086    contribution which would be required for regular members of the
2087    Florida Retirement System. Effective July 1, 1991, contributions
2088    shall be made as provided in s. 121.122 for retirees with
2089    renewed membership or subsection (13) with respect to DROP
2090    participants.
2091          8. Any person who has previously retired and who is
2092    holding an elective public office or an appointment to an
2093    elective public office eligible for the Elected Officers' Class
2094    on or after July 1, 1990, shall be enrolled in the Florida
2095    Retirement System as provided in s. 121.053(1)(b) or, if holding
2096    an elective public office that does not qualify for the Elected
2097    Officers' Class on or after July 1, 1991, shall be enrolled in
2098    the Florida Retirement System as provided in s. 121.122, and
2099    shall continue to receive retirement benefits as well as
2100    compensation for the elected officer's service for as long as he
2101    or she remains in elective office. However, any retired member
2102    who served in an elective office prior to July 1, 1990,
2103    suspended his or her retirement benefit, and had his or her
2104    Florida Retirement System membership reinstated shall, upon
2105    retirement from such office, have his or her retirement benefit
2106    recalculated to include the additional service and compensation
2107    earned.
2108          9. Any person who is holding an elective public office
2109    which is covered by the Florida Retirement System and who is
2110    concurrently employed in nonelected covered employment may elect
2111    to retire while continuing employment in the elective public
2112    office, provided that he or she shall be required to terminate
2113    his or her nonelected covered employment. Any person who
2114    exercises this election shall receive his or her retirement
2115    benefits in addition to the compensation of the elective office
2116    without regard to the time limitations otherwise provided in
2117    this subsection. No person who seeks to exercise the provisions
2118    of this subparagraph, as the same existed prior to May 3, 1984,
2119    shall be deemed to be retired under those provisions, unless
2120    such person is eligible to retire under the provisions of this
2121    subparagraph, as amended by chapter 84-11, Laws of Florida.
2122          10. The limitations of this paragraph apply to
2123    reemployment in any capacity with an "employer" as defined in s.
2124    121.021(10), irrespective of the category of funds from which
2125    the person is compensated.
2126          11. An employing agency may reemploy a retired member as a
2127    firefighter or paramedic after the retired member has been
2128    retired for 1 calendar month, in accordance with s. 121.021(39).
2129    Any retired member who is reemployed within 1 calendar month
2130    after retirement shall void his or her application for
2131    retirement benefits. The employing agency reemploying such
2132    firefighter or paramedic is subject to the retired contribution
2133    required in subparagraph 8. Reemployment of a retired
2134    firefighter or paramedic is limited to no more than 780 hours
2135    during the first 12 months of his or her retirement. Any retired
2136    member reemployed for more than 780 hours during the first 12
2137    months of retirement shall give timely notice in writing to the
2138    employer and to the division of the date he or she will exceed
2139    the limitation. The division shall suspend his or her retirement
2140    benefits for the remainder of the first 12 months of retirement.
2141    Any person employed in violation of this subparagraph and any
2142    employing agency which knowingly employs or appoints such person
2143    without notifying the Division of Retirement to suspend
2144    retirement benefits shall be jointly and severally liable for
2145    reimbursement to the Retirement System Trust Fund of any
2146    benefits paid during the reemployment limitation period. To
2147    avoid liability, such employing agency shall have a written
2148    statement from the retiree that he or she is not retired from a
2149    state-administered retirement system. Any retirement benefits
2150    received by a retired member while reemployed in excess of 780
2151    hours during the first 12 months of retirement shall be repaid
2152    to the Retirement System Trust Fund, and retirement benefits
2153    shall remain suspended until repayment is made. Benefits
2154    suspended beyond the end of the retired member's first 12 months
2155    of retirement shall apply toward repayment of benefits received
2156    in violation of the 780-hour reemployment limitation.
2157          (10) FUTURE BENEFITS BASED ON ACTUARIAL DATA.--It is the
2158    intent of the Legislature that future benefit increases enacted
2159    into law in this chapter shall be financed concurrently by
2160    increased contributions or other adequate funding, and such
2161    funding shall be based on sound actuarial data as developed by
2162    the actuary or state retirement actuary, as provided in ss.
2163    121.021(6) and 121.192.
2164          (11) A member who becomes eligible to retire and has
2165    accumulated the maximum benefit of 100 percent of average final
2166    compensation may continue in active service, and, if upon the
2167    member's retirement the member elects to receive a retirement
2168    compensation pursuant to subsection (2), subsection (6), or
2169    subsection (7), the actuarial equivalent percentage factor
2170    applicable to the age of such member at the time the member
2171    reached the maximum benefit and to the age, at that time, of the
2172    member's spouse shall determine the amount of benefits to be
2173    paid.
2174          (12) SPECIAL PROVISIONS FOR PAYMENT OF CERTAIN SURVIVOR
2175    BENEFITS.--Notwithstanding any provision of this chapter to the
2176    contrary, for members with an effective date of retirement, or
2177    date of death if prior to retirement, on or after January 1,
2178    1996, the named joint annuitant, as defined in s.
2179    121.021(28)(b), who is eligible to receive benefits under
2180    subparagraph (6)(a)3. or subparagraph (6)(a)4., shall receive
2181    the maximum monthly retirement benefit that would have been
2182    payable to the member under subparagraph (6)(a)1.; however,
2183    payment of such benefit shall cease the month the joint
2184    annuitant attains age 25 unless such joint annuitant is disabled
2185    and incapable of self-support, in which case, benefits shall
2186    cease when the joint annuitant is no longer disabled. The
2187    administrator may require proof of disability or continued
2188    disability in the same manner as is provided for a member
2189    seeking or receiving a disability retirement benefit under
2190    subsection (4).
2191          (13) DEFERRED RETIREMENT OPTION PROGRAM.--In general, and
2192    subject to the provisions of this section, the Deferred
2193    Retirement Option Program, hereinafter referred to as the DROP,
2194    is a program under which an eligible member of the Florida
2195    Retirement System may elect to participate, deferring receipt of
2196    retirement benefits while continuing employment with his or her
2197    Florida Retirement System employer. The deferred monthly
2198    benefits shall accrue in the System Trust Fund on behalf of the
2199    participant, plus interest compounded monthly, for the specified
2200    period of the DROP participation, as provided in paragraph (c).
2201    Upon termination of employment, the participant shall receive
2202    the total DROP benefits and begin to receive the previously
2203    determined normal retirement benefits. Participation in the DROP
2204    does not guarantee employment for the specified period of DROP.
2205          (a) Eligibility of member to participate in the DROP.--All
2206    active Florida Retirement System members in a regularly
2207    established position, and all active members of either the
2208    Teachers' Retirement System established in chapter 238 or the
2209    State and County Officers' and Employees' Retirement System
2210    established in chapter 122 which systems are consolidated within
2211    the Florida Retirement System under s. 121.011, are eligible to
2212    elect participation in the DROP provided that:
2213          1. The member is not a renewed member of the Florida
2214    Retirement System under s. 121.122, or a member of the State
2215    Community College System Optional Retirement Program under s.
2216    121.051, the Senior Management Service Optional Annuity Program
2217    under s. 121.055, or the optional retirement program for the
2218    State University System under s. 121.35.
2219          2. Except as provided in subparagraph 6., election to
2220    participate is made within 12 months immediately following the
2221    date on which the member first reaches normal retirement date,
2222    or, for a member who reaches normal retirement date based on
2223    service before he or she reaches age 62, or age 55 for Special
2224    Risk Class members, election to participate may be deferred to
2225    the 12 months immediately following the date the member attains
2226    57, or age 52 for Special Risk Class members. For a member who
2227    first reached normal retirement date or the deferred eligibility
2228    date described above prior to the effective date of this
2229    section, election to participate shall be made within 12 months
2230    after the effective date of this section. A member who fails to
2231    make an election within such 12-month limitation period shall
2232    forfeit all rights to participate in the DROP. The member shall
2233    advise his or her employer and the division in writing of the
2234    date on which the DROP shall begin. Such beginning date may be
2235    subsequent to the 12-month election period, but must be within
2236    the 60-month limitation period as provided in subparagraph (b)1.
2237    When establishing eligibility of the member to participate in
2238    the DROP for the 60-month maximum participation period, the
2239    member may elect to include or exclude any optional service
2240    credit purchased by the member from the total service used to
2241    establish the normal retirement date. A member with dual normal
2242    retirement dates shall be eligible to elect to participate in
2243    DROP within 12 months after attaining normal retirement date in
2244    either class.
2245          3. The employer of a member electing to participate in the
2246    DROP, or employers if dually employed, shall acknowledge in
2247    writing to the division the date the member's participation in
2248    the DROP begins and the date the member's employment and DROP
2249    participation will terminate.
2250          4. Simultaneous employment of a participant by additional
2251    Florida Retirement System employers subsequent to the
2252    commencement of participation in the DROP shall be permissible
2253    provided such employers acknowledge in writing a DROP
2254    termination date no later than the participant's existing
2255    termination date or the 60-month limitation period as provided
2256    in subparagraph (b)1.
2257          5. A DROP participant may change employers while
2258    participating in the DROP, subject to the following:
2259          a. A change of employment must take place without a break
2260    in service so that the member receives salary for each month of
2261    continuous DROP participation. If a member receives no salary
2262    during a month, DROP participation shall cease unless the
2263    employer verifies a continuation of the employment relationship
2264    for such participant pursuant to s. 121.021(39)(b).
2265          b. Such participant and new employer shall notify the
2266    division on forms required by the division as to the identity of
2267    the new employer.
2268          c. The new employer shall acknowledge, in writing, the
2269    participant's DROP termination date, which may be extended but
2270    not beyond the original 60-month period provided in subparagraph
2271    (b)1., shall acknowledge liability for any additional retirement
2272    contributions and interest required if the participant fails to
2273    timely terminate employment, and shall be subject to the
2274    adjustment required in sub-subparagraph (c)5.d.
2275          6. Effective July 1, 2001, for instructional personnel as
2276    defined in s. 1012.01(2), election to participate in the DROP
2277    shall be made at any time following the date on which the member
2278    first reaches normal retirement date. The member shall advise
2279    his or her employer and the division in writing of the date on
2280    which the Deferred Retirement Option Program shall begin. When
2281    establishing eligibility of the member to participate in the
2282    DROP for the 60-month maximum participation period, as provided
2283    in subparagraph (b)1., the member may elect to include or
2284    exclude any optional service credit purchased by the member from
2285    the total service used to establish the normal retirement date.
2286    A member with dual normal retirement dates shall be eligible to
2287    elect to participate in either class.
2288          (b) Participation in the DROP.--
2289          1. An eligible member may elect to participate in the DROP
2290    for a period not to exceed a maximum of 60 calendar months
2291    immediately following the date on which the member first reaches
2292    his or her normal retirement date or the date to which he or she
2293    is eligible to defer his or her election to participate as
2294    provided in subparagraph (a)2. However, a member who has reached
2295    normal retirement date prior to the effective date of the DROP
2296    shall be eligible to participate in the DROP for a period of
2297    time not to exceed 60 calendar months immediately following the
2298    effective date of the DROP, except a member of the Special Risk
2299    Class who has reached normal retirement date prior to the
2300    effective date of the DROP and whose total accrued value exceeds
2301    75 percent of average final compensation as of his or her
2302    effective date of retirement shall be eligible to participate in
2303    the DROP for no more than 36 calendar months immediately
2304    following the effective date of the DROP.
2305          2. Upon deciding to participate in the DROP, the member
2306    shall submit, on forms required by the division:
2307          a. A written election to participate in the DROP;
2308          b. Selection of the DROP participation and termination
2309    dates, which satisfy the limitations stated in paragraph (a) and
2310    subparagraph 1. Such termination date shall be in a binding
2311    letter of resignation with the employer, establishing a deferred
2312    termination date. The member may change the termination date
2313    within the limitations of subparagraph 1., but only with the
2314    written approval of his or her employer;
2315          c. A properly completed DROP application for service
2316    retirement as provided in this section; and
2317          d. Any other information required by the division.
2318          3. The DROP participant shall be a retiree under the
2319    Florida Retirement System for all purposes, except for paragraph
2320    (5)(f) and subsection (9) and ss. 112.3173, 112.363, 121.053,
2321    and 121.122. However, participation in the DROP does not alter
2322    the participant's employment status and such employee shall not
2323    be deemed retired from employment until his or her deferred
2324    resignation is effective and termination occurs as provided in
2325    s. 121.021(39).
2326          4. Elected officers shall be eligible to participate in
2327    the DROP subject to the following:
2328          a. An elected officer who reaches normal retirement date
2329    during a term of office may defer the election to participate in
2330    the DROP until the next succeeding term in that office. Such
2331    elected officer who exercises this option may participate in the
2332    DROP for up to 60 calendar months or a period of no longer than
2333    such succeeding term of office, whichever is less.
2334          b. An elected or a nonelected participant may run for a
2335    term of office while participating in DROP and, if elected,
2336    extend the DROP termination date accordingly, except, however,
2337    if such additional term of office exceeds the 60-month
2338    limitation established in subparagraph 1., and the officer does
2339    not resign from office within such 60-month limitation, the
2340    retirement and the participant's DROP shall be null and void as
2341    provided in sub-subparagraph (c)5.d.
2342          c. An elected officer who is dually employed and elects to
2343    participate in DROP shall be required to satisfy the definition
2344    of termination within the 60-month limitation period as provided
2345    in subparagraph 1. for the nonelected position and may continue
2346    employment as an elected officer as provided in s. 121.053. The
2347    elected officer will be enrolled as a renewed member in the
2348    Elected Officers' Class or the Regular Class, as provided in ss.
2349    121.053 and 121.22, on the first day of the month after
2350    termination of employment in the nonelected position and
2351    termination of DROP. Distribution of the DROP benefits shall be
2352    made as provided in paragraph (c).
2353          (c) Benefits payable under the DROP.--
2354          1. Effective with the date of DROP participation, the
2355    member's initial normal monthly benefit, including creditable
2356    service, optional form of payment, and average final
2357    compensation, and the effective date of retirement shall be
2358    fixed. The beneficiary established under the Florida Retirement
2359    System shall be the beneficiary eligible to receive any DROP
2360    benefits payable if the DROP participant dies prior to the
2361    completion of the period of DROP participation. In the event a
2362    joint annuitant predeceases the member, the member may name a
2363    beneficiary to receive accumulated DROP benefits payable. Such
2364    retirement benefit, the annual cost of living adjustments
2365    provided in s. 121.101, and interest shall accrue monthly in the
2366    System Trust Fund. Such interest shall accrue at an effective
2367    annual rate of 6.5 percent compounded monthly, on the prior
2368    month's accumulated ending balance, up to the month of
2369    termination or death.
2370          2. Each employee who elects to participate in the DROP
2371    shall be allowed to elect to receive a lump-sum payment for
2372    accrued annual leave earned in accordance with agency policy
2373    upon beginning participation in the DROP. Such accumulated leave
2374    payment certified to the division upon commencement of DROP
2375    shall be included in the calculation of the member's average
2376    final compensation. The employee electing such lump-sum payment
2377    upon beginning participation in DROP will not be eligible to
2378    receive a second lump-sum payment upon termination, except to
2379    the extent the employee has earned additional annual leave which
2380    combined with the original payment does not exceed the maximum
2381    lump-sum payment allowed by the employing agency's policy or
2382    rules. Such early lump-sum payment shall be based on the hourly
2383    wage of the employee at the time he or she begins participation
2384    in the DROP. If the member elects to wait and receive such lump-
2385    sum payment upon termination of DROP and termination of
2386    employment with the employer, any accumulated leave payment made
2387    at that time cannot be included in the member's retirement
2388    benefit, which was determined and fixed by law when the employee
2389    elected to participate in the DROP.
2390          3. The effective date of DROP participation and the
2391    effective date of retirement of a DROP participant shall be the
2392    first day of the month selected by the member to begin
2393    participation in the DROP, provided such date is properly
2394    established, with the written confirmation of the employer, and
2395    the approval of the division, on forms required by the division.
2396          4. Normal retirement benefits and interest thereon shall
2397    continue to accrue in the DROP until the established termination
2398    date of the DROP, or until the participant terminates employment
2399    or dies prior to such date. Although individual DROP accounts
2400    shall not be established, a separate accounting of each
2401    participant's accrued benefits under the DROP shall be
2402    calculated and provided to participants.
2403          5. At the conclusion of the participant's DROP, the
2404    division shall distribute the participant's total accumulated
2405    DROP benefits, subject to the following provisions:
2406          a. The division shall receive verification by the
2407    participant's employer or employers that such participant has
2408    terminated employment as provided in s. 121.021(39)(b).
2409          b. The terminated DROP participant or, if deceased, such
2410    participant's named beneficiary, shall elect on forms provided
2411    by the division to receive payment of the DROP benefits in
2412    accordance with one of the options listed below. For a
2413    participant or beneficiary who fails to elect a method of
2414    payment within 60 days of termination of the DROP, the division
2415    will pay a lump sum as provided in sub-sub-subparagraph (I).
2416          (I) Lump sum.--All accrued DROP benefits, plus interest,
2417    less withholding taxes remitted to the Internal Revenue Service,
2418    shall be paid to the DROP participant or surviving beneficiary.
2419          (II) Direct rollover.--All accrued DROP benefits, plus
2420    interest, shall be paid from the DROP directly to the custodian
2421    of an eligible retirement plan as defined in s. 402(c)(8)(B) of
2422    the Internal Revenue Code. However, in the case of an eligible
2423    rollover distribution to the surviving spouse of a deceased
2424    participant, an eligible retirement plan is an individual
2425    retirement account or an individual retirement annuity as
2426    described in s. 402(c)(9) of the Internal Revenue Code.
2427          (III) Partial lump sum.--A portion of the accrued DROP
2428    benefits shall be paid to the DROP participant or surviving
2429    spouse, less withholding taxes remitted to the Internal Revenue
2430    Service, and the remaining DROP benefits shall be transferred
2431    directly to the custodian of an eligible retirement plan as
2432    defined in s. 402(c)(8)(B) of the Internal Revenue Code.
2433    However, in the case of an eligible rollover distribution to the
2434    surviving spouse of a deceased participant, an eligible
2435    retirement plan is an individual retirement account or an
2436    individual retirement annuity as described in s. 402(c)(9) of
2437    the Internal Revenue Code. The proportions shall be specified by
2438    the DROP participant or surviving beneficiary.
2439          c. The form of payment selected by the DROP participant or
2440    surviving beneficiary complies with the minimum distribution
2441    requirements of the Internal Revenue Code.
2442          d. A DROP participant who fails to terminate employment as
2443    defined in s. 121.021(39)(b) shall be deemed not to be retired,
2444    and the DROP election shall be null and void. Florida Retirement
2445    System membership shall be reestablished retroactively to the
2446    date of the commencement of the DROP, and each employer with
2447    whom the participant continues employment shall be required to
2448    pay to the System Trust Fund the difference between the DROP
2449    contributions paid in paragraph (i) and the contributions
2450    required for the applicable Florida Retirement System class of
2451    membership during the period the member participated in the
2452    DROP, plus 6.5 percent interest compounded annually.
2453          6. The accrued benefits of any DROP participant, and any
2454    contributions accumulated under such program, shall not be
2455    subject to assignment, execution, attachment, or to any legal
2456    process whatsoever, except for qualified domestic relations
2457    orders by a court of competent jurisdiction, income deduction
2458    orders as provided in s. 61.1301, and federal income tax levies.
2459          7. DROP participants shall not be eligible for disability
2460    retirement benefits as provided in subsection (4).
2461          (d) Death benefits under the DROP.--
2462          1. Upon the death of a DROP participant, the named
2463    beneficiary shall be entitled to apply for and receive the
2464    accrued benefits in the DROP as provided in sub-subparagraph
2465    (c)5.b.
2466          2. The normal retirement benefit accrued to the DROP
2467    during the month of a participant's death shall be the final
2468    monthly benefit credited for such DROP participant.
2469          3. Eligibility to participate in the DROP terminates upon
2470    death of the participant. If the participant dies on or after
2471    the effective date of enrollment in the DROP, but prior to the
2472    first monthly benefit being credited to the DROP, Florida
2473    Retirement System benefits shall be paid in accordance with
2474    subparagraph (7)(c)1. or subparagraph 2.
2475          4. A DROP participants' survivors shall not be eligible to
2476    receive Florida Retirement System death benefits as provided in
2477    paragraph (7)(d).
2478          (e) Cost-of-living adjustment.--On each July 1, the
2479    participants' normal retirement benefit shall be increased as
2480    provided in s. 121.101.
2481          (f) Retiree health insurance subsidy.--DROP participants
2482    are not eligible to apply for the retiree health insurance
2483    subsidy payments as provided in s. 112.363 until such
2484    participants have terminated employment and participation in the
2485    DROP.
2486          (g) Renewed membership.--DROP participants shall not be
2487    eligible for renewed membership in the Florida Retirement System
2488    under ss. 121.053 and 121.122 until termination of employment is
2489    effectuated as provided in s. 121.021(39)(b).
2490          (h) Employment limitation after DROP participation.--Upon
2491    satisfying the definition of termination of employment as
2492    provided in s. 121.021(39)(b), DROP participants shall be
2493    subject to such reemployment limitations as other retirees.
2494    Reemployment restrictions applicable to retirees as provided in
2495    subsection (9) shall not apply to DROP participants until their
2496    employment and participation in the DROP are terminated.
2497          (i) Contributions.--
2498          1. All employers paying the salary of a DROP participant
2499    filling a regularly established position shall contribute 8.0
2500    percent of such participant's gross compensation for the period
2501    of July 1, 2002, through June 30, 2003, and 11.56 percent of
2502    such compensation thereafter, which shall constitute the entire
2503    employer DROP contribution with respect to such participant.
2504    Such contributions, payable to the System Trust Fund in the same
2505    manner as required in s. 121.071, shall be made as appropriate
2506    for each pay period and are in addition to contributions
2507    required for social security and the Retiree Health Insurance
2508    Subsidy Trust Fund. Such employer, social security, and health
2509    insurance subsidy contributions are not included in the DROP.
2510          2. The employer shall, in addition to subparagraph 1.,
2511    also withhold one-half of the entire social security
2512    contribution required for the participant. Contributions for
2513    social security by each participant and each employer, in the
2514    amount required for social security coverage as now or hereafter
2515    provided by the federal Social Security Act, shall be in
2516    addition to contributions specified in subparagraph 1.
2517          3. All employers paying the salary of a DROP participant
2518    filling a regularly established position shall contribute the
2519    percent of such participant's gross compensation required in s.
2520    121.071(4), which shall constitute the employer's health
2521    insurance subsidy contribution with respect to such participant.
2522    Such contributions shall be deposited by the administrator in
2523    the Retiree Health Insurance Subsidy Trust Fund.
2524          (j) Forfeiture of retirement benefits.--Nothing in this
2525    section shall be construed to remove DROP participants from the
2526    scope of s. 8(d), Art. II of the State Constitution, s.
2527    112.3173, and paragraph (5)(f). DROP participants who commit a
2528    specified felony offense while employed will be subject to
2529    forfeiture of all retirement benefits, including DROP benefits,
2530    pursuant to those provisions of law.
2531          (k) Administration of program.--The division shall make
2532    such rules as are necessary for the effective and efficient
2533    administration of this subsection. The division shall not be
2534    required to advise members of the federal tax consequences of an
2535    election related to the DROP but may advise members to seek
2536    independent advice.
2537          (14) PAYMENT OF BENEFITS.--This subsection applies to the
2538    payment of benefits to a payee (retiree or beneficiary) under
2539    the Florida Retirement System:
2540          (a) Federal income tax shall be withheld in accordance
2541    with federal law, unless the payee elects otherwise on Form W-
2542    4P. The division shall prepare and distribute to each recipient
2543    of monthly retirement benefits an appropriate income tax form
2544    that reflects the recipient's income and federal income tax
2545    withheld for the calendar year just ended.
2546          (b) Subject to approval by the division in accordance with
2547    rule 60S-4.015, Florida Administrative Code, a payee receiving
2548    retirement benefits under the Florida Retirement System may also
2549    have the following payments deducted from his or her monthly
2550    benefit:
2551          1. Premiums for life and health-related insurance policies
2552    from approved companies.
2553          2. Life insurance premiums for the State Group Life
2554    Insurance Plan, if authorized in writing by the payee and by the
2555    Department of Management Services.
2556          3. Repayment of overpayments from the Florida Retirement
2557    System Trust Fund, the State Employees' Health Insurance Trust
2558    Fund, or the State Employees' Life Insurance Trust Fund, upon
2559    notification of the payee.
2560          4. Payments to an alternate payee for alimony, child
2561    support, or division of marital assets pursuant to a qualified
2562    domestic relations order under s. 222.21 or an income deduction
2563    order under s. 61.1301.
2564          5. Payments to the Internal Revenue Service for federal
2565    income tax levies, upon notification of the division by the
2566    Internal Revenue Service.
2567          (c) A payee shall notify the division of any change in his
2568    or her address. The division may suspend benefit payments to a
2569    payee if correspondence sent to the payee's mailing address is
2570    returned due to an incorrect address. Benefit payments shall be
2571    resumed upon notification to the division of the payee's new
2572    address.
2573          (d) A payee whose retirement benefits are reduced by the
2574    application of maximum benefit limits under s. 415(b) of the
2575    Internal Revenue Code, as specified in s. 121.30(5), shall have
2576    the portion of his or her calculated benefit in the Florida
2577    Retirement System defined benefit plan which exceeds such
2578    federal limitation paid through the Florida Retirement System
2579    Preservation of Benefits Plan, as provided in s. 121.1001.
2580          (e) No benefit may be reduced for the purpose of
2581    preserving the member's eligibility for a federal program.
2582          (f) The division shall adopt rules establishing procedures
2583    for determining that the persons to whom benefits are being paid
2584    are still living. The division shall suspend the benefits being
2585    paid to any payee when it is unable to contact such payee and to
2586    confirm that he or she is still living.
2587          Section 31. Paragraph (b) of subsection (7) of section
2588    121.101, Florida Statutes, is amended to read:
2589          121.101 Cost-of-living adjustment of benefits.--
2590          (7) The purpose of this subsection is to establish a
2591    supplemental cost-of-living adjustment for certain retirees and
2592    beneficiaries who receive monthly retirement benefits under the
2593    provisions of this chapter and the existing systems consolidated
2594    therein, s. 112.05 for certain state officers and employees, and
2595    s. 238.171 for certain elderly incapacitated teachers.
2596          (b) Application for the supplemental cost-of-living
2597    adjustment provided by this subsection shall include
2598    certification by the retiree or annuitant that he or she is not
2599    receiving, and is not eligible to receive, social security
2600    benefits and shall include written authorization for the
2601    divisiondepartmentto have access to information from the
2602    Social Security Administration concerning his or her entitlement
2603    to, or eligibility for, social security benefits. Such
2604    supplemental cost-of-living adjustment shall not be paid unless
2605    and until the application requirements of this paragraph are
2606    met.
2607          Section 32. Paragraph (e) of subsection (2) of section
2608    121.111, Florida Statutes, is amended to read:
2609          121.111 Credit for military service.--
2610          (2) Any member whose initial date of employment is before
2611    January 1, 1987, who has military service as defined in s.
2612    121.021(20)(b), and who does not claim such service under
2613    subsection (1) may receive creditable service for such military
2614    service if:
2615          (e) Any member claiming credit under this subsection must
2616    certify on the form prescribed by the divisiondepartmentthat
2617    credit for such service has not and will not be claimed for
2618    retirement purposes under any other federal, state, or local
2619    retirement or pension system where "length of service" is a
2620    factor in determining the amount of compensation received,
2621    except where credit for such service has been granted in a
2622    pension system providing retired pay for nonregular service as
2623    provided in paragraph (d). If the member dies prior to
2624    retirement, the member's beneficiary must make the required
2625    certification before credit may be claimed. If such
2626    certification is not made by the member or the member's
2627    beneficiary, credit for wartime military service shall not be
2628    allowed.
2629          Section 33. Section 121.133, Florida Statutes, is amended
2630    to read:
2631          121.133 Cancellation of uncashed
2632    warrants.--Notwithstanding the provisions of s. 17.26 or s.
2633    717.123 to the contrary, effective July 1, 1998, if any state
2634    warrant issued by the Comptroller for the payment of retirement
2635    benefits from the Florida Retirement System Trust Fund, or any
2636    other pension trust fund administered by the division
2637    department, is not presented for payment within 1 year after the
2638    last day of the month in which it was originally issued, the
2639    Comptroller shall cancel the benefit warrant and credit the
2640    amount of the warrant to the Florida Retirement System Trust
2641    Fund or other pension trust fund administered by the division
2642    department, as appropriate. The divisiondepartmentmay provide
2643    for issuance of a replacement warrant when deemed appropriate.
2644          Section 34. Section 121.135, Florida Statutes, is amended
2645    to read:
2646          121.135 Annual report to Legislature concerning state-
2647    administered retirement systems.--The divisiondepartmentshall
2648    make to each regular session of the Legislature a written report
2649    on the operation and condition of the state-administered
2650    retirement systems.
2651          Section 35. Section 121.136, Florida Statutes, is amended
2652    to read:
2653          121.136 Annual benefit statement to members.--Beginning
2654    January 1, 1993, and each January thereafter, the division
2655    departmentshall provide each active member of the Florida
2656    Retirement System with 5 or more years of creditable service an
2657    annual statement of benefits. Such statement should provide the
2658    member with basic data about the member's retirement account.
2659    Minimally, it shall include the member's retirement plan, the
2660    amount of funds on deposit in the retirement account, and an
2661    estimate of retirement benefits.
2662          Section 36. Section 121.1815, Florida Statutes, is amended
2663    to read:
2664          121.1815 Special pensions to individuals; administration
2665    of laws by the Division of RetirementDepartment of Management
2666    Services.--All powers, duties, and functions related to the
2667    administration of laws providing special pensions to
2668    individuals, including chapter 18054, Laws of Florida, 1937;
2669    chapter 26788, Laws of Florida, 1951, as amended by chapter 57-
2670    871, Laws of Florida; chapter 26836, Laws of Florida, 1951; and
2671    chapter 63-953, Laws of Florida, are vested in the division
2672    department. All laws hereinafter enacted by the Legislature
2673    pertaining to special pensions for individuals shall be
2674    administered by the divisiondepartment, unless contrary
2675    provisions are contained in such law. Upon the death of any
2676    person receiving a monthly pension under this section, the
2677    monthly pension shall be paid through the last day of the month
2678    of death and shall terminate on that date, unless contrary
2679    provisions are contained in the special pension law.
2680          Section 37. Section 121.1905, Florida Statutes, is amended
2681    to read:
2682          121.1905 Division of Retirement; missioncreation.--
2683          (1) There is created the Division of Retirement within the
2684    Department of Management Services.
2685          (2)The mission of the Division of Retirement is to
2686    provide quality and cost-effective retirement services as
2687    measured by member satisfaction and by comparison with
2688    administrative costs of comparable retirement systems.
2689          Section 38. Section 121.192, Florida Statutes, is amended
2690    to read:
2691          121.192 State retirement actuary.--The divisiondepartment
2692    may employ an actuary. Such actuary shall, together with such
2693    other duties as the director assignssecretary may assign, be
2694    responsible for:
2695          (1) Advising the directorsecretaryon actuarial matters
2696    of the state retirement systems.
2697          (2) Making periodic valuations of the retirement systems.
2698          (3) Providing actuarial analyses to the Legislature
2699    concerning proposed changes in the retirement systems.
2700          (4) Assisting the directorsecretaryin developing a sound
2701    and modern retirement system.
2702          Section 39. Section 121.193, Florida Statutes, is amended
2703    to read:
2704          121.193 External compliance audits.--
2705          (1) The divisiondepartmentshall conduct audits of the
2706    payroll and personnel records of participating agencies. These
2707    audits shall be made to determine the accuracy of reports
2708    submitted to the divisiondepartmentand to assess the degree of
2709    compliance with applicable statutes, rules, and coverage
2710    agreements. Audits shall be scheduled on a regular basis, as the
2711    result of concerns known to exist at an agency, or as a followup
2712    to ensure agency action was taken to correct deficiencies found
2713    in an earlier audit.
2714          (2) Upon request, participating agencies shall furnish the
2715    divisiondepartment with information and documents that the
2716    divisiondepartment requires to conduct the audit. The division
2717    departmentmay prescribe by rule the documents that may be
2718    requested.
2719          (3) The divisiondepartmentshall review the agency's
2720    operations concerning retirement and social security coverage.
2721    Preliminary findings shall be discussed with agency personnel at
2722    the close of the audit. An audit report of findings and
2723    recommendations shall be submitted to divisiondepartment
2724    management and an audit summary letter shall be submitted to the
2725    agency noting any concerns and necessary corrective action.
2726          Section 40. Subsection (1) of section 121.22, Florida
2727    Statutes, is amended to read:
2728          121.22 State Retirement Commission; creation; membership;
2729    compensation.--
2730          (1)(a) There is created within the Division of Retirement
2731    Department of Management Servicesa State Retirement Commission
2732    composed of fourthree members: two membersOne member who are
2733    isretired under a state-supported retirement system
2734    administered by the divisiondepartment; one member who is an
2735    active member of a state-supported retirement system that is
2736    administered by the divisiondepartment; and one member who is
2737    neither a retiree, beneficiary, or member of a state-supported
2738    retirement system administered by the divisiondepartment. Each
2739    member shall have a different occupational background from the
2740    other members.
2741          (b) The State Retirement Commission shall be assigned to
2742    and administratively housed within the Division of Retirement,
2743    but the commission shall function independently and shall not be
2744    under the supervision of the division or the board. The exercise
2745    by the commission of its powers, duties, and functions as
2746    prescribed by law is not subject to the review or approval of
2747    the division or the board.
2748          Section 41. Subsection (1) of section 121.23, Florida
2749    Statutes, is amended to read:
2750          121.23 Disability retirement and special risk membership
2751    applications; Retirement Commission; powers and duties; judicial
2752    review.--The provisions of this section apply to all proceedings
2753    in which the administrator has made a written final decision on
2754    the merits respecting applications for disability retirement,
2755    reexamination of retired members receiving disability benefits,
2756    applications for special risk membership, and reexamination of
2757    special risk members in the Florida Retirement System. The
2758    jurisdiction of the State Retirement Commission under this
2759    section shall be limited to written final decisions of the
2760    administrator on the merits.
2761          (1) In accordance with the rules of procedure adopted by
2762    the divisionDepartment of Management Services, the
2763    administrator shall:
2764          (a) Give reasonable notice of his or her proposed action,
2765    or decision to refuse action, together with a summary of the
2766    factual, legal, and policy grounds therefor.
2767          (b) Give affected members, or their counsel, an
2768    opportunity to present to the division written evidence in
2769    opposition to the proposed action or refusal to act or a written
2770    statement challenging the grounds upon which the administrator
2771    has chosen to justify his or her action or inaction.
2772          (c) If the objections of the member are overruled, provide
2773    a written explanation within 21 days.
2774          Section 42. Subsections (2), (3), and (4) of section
2775    121.24, Florida Statutes, are amended to read:
2776          121.24 Conduct of commission business; legal and other
2777    assistance; compensation.--
2778          (2) Legal counsel for the commission may be provided by
2779    the Department of Legal Affairs or by the divisionDepartment of
2780    Management Services, with the concurrence of the commission, and
2781    shall be paid by the divisionDepartment of Management Services
2782    from the appropriate funds.
2783          (3) The divisionDepartment of Management Servicesshall
2784    provide timely and appropriate training for newly appointed
2785    members of the commission. Such training shall be designed to
2786    acquaint new members of the commission with the duties and
2787    responsibilities of the commission.
2788          (4) The divisionDepartment of Management Servicesshall
2789    furnish administrative and secretarial assistance to the
2790    commission and shall provide a place where the commission may
2791    hold its meetings.
2792          Section 43. Subsection (9) of section 121.30, Florida
2793    Statutes, is amended to read:
2794          121.30 Statements of purpose and intent and other
2795    provisions required for qualification under the Internal Revenue
2796    Code of the United States.--Any other provisions in this chapter
2797    to the contrary notwithstanding, it is specifically provided
2798    that:
2799          (9) The divisiondepartmentmay adopt any rule necessary
2800    to accomplish the purpose of the section which is not
2801    inconsistent with this chapter.
2802          Section 44. Paragraph (c) of subsection (2), paragraphs
2803    (c) and (e) of subsection (3), paragraphs (a), (b), and (c) of
2804    subsection (4), and subsection (6) of section 121.35, Florida
2805    Statutes, are amended to read:
2806          121.35 Optional retirement program for the State
2807    University System.--
2808          (2) ELIGIBILITY FOR PARTICIPATION IN OPTIONAL PROGRAM.--
2809          (c) For purposes of this section, the Division of
2810    RetirementDepartment of Management Servicesis referred to as
2811    the "divisiondepartment."
2812          (3) ELECTION OF OPTIONAL PROGRAM.--
2813          (c) Any employee who becomes eligible to participate in
2814    the optional retirement program on or after January 1, 1993,
2815    shall be a compulsory participant of the program unless such
2816    employee elects membership in the Florida Retirement System.
2817    Such election shall be made in writing and filed with the
2818    personnel officer of the employer. Any eligible employee who
2819    fails to make such election within the prescribed time period
2820    shall be deemed to have elected to participate in the optional
2821    retirement program.
2822          1. Any employee whose optional retirement program
2823    eligibility results from initial employment shall be enrolled in
2824    the program at the commencement of employment. If, within 90
2825    days after commencement of employment, the employee elects
2826    membership in the Florida Retirement System, such membership
2827    shall be effective retroactive to the date of commencement of
2828    employment.
2829          2. Any employee whose optional retirement program
2830    eligibility results from a change in status due to the
2831    subsequent designation of the employee's position as one of
2832    those specified in paragraph (2)(a) or due to the employee's
2833    appointment, promotion, transfer, or reclassification to a
2834    position specified in paragraph (2)(a) shall be enrolled in the
2835    optional retirement program upon such change in status and shall
2836    be notified by the employer of such action. If, within 90 days
2837    after the date of such notification, the employee elects to
2838    retain membership in the Florida Retirement System, such
2839    continuation of membership shall be retroactive to the date of
2840    the change in status.
2841          3. Notwithstanding the provisions of this paragraph,
2842    effective July 1, 1997, any employee who is eligible to
2843    participate in the Optional Retirement Program and who fails to
2844    execute a contract with one of the approved companies and to
2845    notify the divisiondepartmentin writing as provided in
2846    subsection (4) within 90 days after the date of eligibility
2847    shall be deemed to have elected membership in the Florida
2848    Retirement System, except as provided in s. 121.051(1)(a). This
2849    provision shall also apply to any employee who terminates
2850    employment in an eligible position before executing the required
2851    annuity contract and notifying the divisiondepartment. Such
2852    membership shall be retroactive to the date of eligibility, and
2853    all appropriate contributions shall be transferred to the
2854    Florida Retirement System Trust Fund and the Health Insurance
2855    Subsidy Trust Fund.
2856          (e) The election by an eligible employee to participate in
2857    the optional retirement program shall be irrevocable for so long
2858    as the employee continues to meet the eligibility requirements
2859    specified in subsection (2), except as provided in paragraph
2860    (h). In the event that an employee participates in the optional
2861    retirement program for 90 days or more and is subsequently
2862    employed in an administrative or professional position which has
2863    been determined by the divisiondepartment, under subparagraph
2864    (2)(a)2., to be not otherwise eligible for participation in the
2865    optional retirement program, the employee shall continue
2866    participation in the optional program so long as the employee
2867    meets the other eligibility requirements for the program, except
2868    as provided in paragraph (h).
2869          (4) CONTRIBUTIONS.--
2870          (a) Through June 30, 2001, each employer shall contribute
2871    on behalf of each participant in the optional retirement program
2872    an amount equal to the normal cost portion of the employer
2873    retirement contribution which would be required if the
2874    participant were a regular member of the Florida Retirement
2875    System defined benefit program, plus the portion of the
2876    contribution rate required in s. 112.363(8) that would otherwise
2877    be assigned to the Retiree Health Insurance Subsidy Trust Fund.
2878    Effective July 1, 2001, each employer shall contribute on behalf
2879    of each participant in the optional program an amount equal to
2880    10.43 percent of the participant's gross monthly compensation.
2881    The divisiondepartmentshall deduct an amount approved by the
2882    Legislature to provide for the administration of this program.
2883    The payment of the contributions to the optional program which
2884    is required by this paragraph for each participant shall be made
2885    by the employer to the divisiondepartment, which shall forward
2886    the contributions to the designated company or companies
2887    contracting for payment of benefits for the participant under
2888    the program. However, such contributions paid on behalf of an
2889    employee described in paragraph (3)(c) shall not be forwarded to
2890    a company and shall not begin to accrue interest until the
2891    employee has executed an annuity contract and notified the
2892    divisiondepartment.
2893          (b) Each employer shall contribute on behalf of each
2894    participant in the optional retirement program an amount equal
2895    to the unfunded actuarial accrued liability portion of the
2896    employer contribution which would be required for members of the
2897    Florida Retirement System. This contribution shall be paid to
2898    the divisiondepartmentfor transfer to the Florida Retirement
2899    System Trust Fund.
2900          (c) An Optional Retirement Program Trust Fund shall be
2901    established in the State Treasury and administered by the
2902    divisiondepartmentto make payments to the provider companies
2903    on behalf of the optional retirement program participants, and
2904    to transfer the unfunded liability portion of the state optional
2905    retirement program contributions to the Florida Retirement
2906    System Trust Fund.
2907          (6) ADMINISTRATION OF PROGRAM.--
2908          (a) The optional retirement program authorized by this
2909    section shall be administered by the divisiondepartment. The
2910    divisiondepartmentshall adopt rules establishing the
2911    responsibilities of the State Board of Education and
2912    institutions in the State University System in administering the
2913    optional retirement program. The State Board of Education shall,
2914    no more than 90 days after July 1, 1983, submit to the division
2915    departmentits recommendations for the contracts to be offered
2916    by the companies chosen by the divisiondepartment. The
2917    recommendations of the board shall include the following:
2918          1. The nature and extent of the rights and benefits in
2919    relation to the required contributions; and
2920          2. The suitability of the rights and benefits to the needs
2921    of the participants and the interests of the institutions in the
2922    recruitment and retention of eligible employees.
2923          (b) After receiving and considering the recommendations of
2924    the State Board of Education, the divisiondepartmentshall
2925    designate no more than four companies from which contracts may
2926    be purchased under the program and shall approve the form and
2927    content of the optional retirement program contracts. Upon
2928    application by a qualified Florida domestic company, the
2929    divisiondepartmentshall give reasonable notice to all other
2930    such companies that it intends to designate one of such
2931    companies as a fifth company from which contracts may be
2932    purchased pursuant to this section and that they may apply for
2933    such designation prior to the deadline established by said
2934    notice. At least 60 days after giving such notice and upon
2935    receipt of the recommendation of the State Board of Education,
2936    the divisiondepartmentshall so designate one of such companies
2937    as the fifth company from which such contracts may be purchased.
2938          (c) Effective July 1, 1997, the State Board of
2939    Administration shall review and make recommendations to the
2940    divisiondepartmenton the acceptability of all investment
2941    products proposed by provider companies of the optional
2942    retirement program before they are offered through annuity
2943    contracts to the participants and may advise the division
2944    departmentof any changes necessary to ensure that the optional
2945    retirement program offers an acceptable mix of investment
2946    products. The divisiondepartmentshall make the final
2947    determination as to whether an investment product will be
2948    approved for the program.
2949          (d) The provisions of each contract applicable to a
2950    participant in the optional retirement program shall be
2951    contained in a written program description which shall include a
2952    report of pertinent financial and actuarial information on the
2953    solvency and actuarial soundness of the program and the benefits
2954    applicable to the participant. Such description shall be
2955    furnished by the companies to each participant in the program
2956    and to the divisiondepartmentupon commencement of
2957    participation in the program and annually thereafter.
2958          (e) The divisiondepartmentshall ensure that each
2959    participant in the optional retirement program is provided an
2960    accounting of the total contribution and the annual contribution
2961    made by and on behalf of such participant.
2962          Section 45. Paragraph (b) of subsection (3) and paragraphs
2963    (a) and (b) of subsection (14) of section 121.40, Florida
2964    Statutes, are amended to read:
2965          121.40 Cooperative extension personnel at the Institute of
2966    Food and Agricultural Sciences; supplemental retirement
2967    benefits.--
2968          (3) DEFINITIONS.--The definitions provided in s. 121.021
2969    shall not apply to this section except when specifically cited.
2970    For the purposes of this section, the following words or phrases
2971    have the respective meanings set forth:
2972          (b) "DivisionDepartment" means the Division of Retirement
2973    of the State Board of AdministrationDepartment of Management
2974    Services.
2975          (14) ADMINISTRATION OF SYSTEM.--
2976          (a) The divisiondepartmentshall make such rules as are
2977    necessary for the effective and efficient administration of this
2978    system. The executive director of the State Board of
2979    Administrationsecretary of the departmentshall be the
2980    administrator of the system. The funds to pay the expenses for
2981    such administration shall be appropriated from the interest
2982    earned on investments made for the trust fund.
2983          (b) The divisiondepartmentis authorized to require
2984    oaths, by affidavit or otherwise, and acknowledgments from
2985    persons in connection with the administration of its duties and
2986    responsibilities under this section.
2987          Section 46. Subsection (3) of section 121.45, Florida
2988    Statutes, is amended to read:
2989          121.45 Interstate compacts relating to pension
2990    portability.--
2991          (3) ESTABLISHMENT OF COMPACTS.--
2992          (a) The divisionDepartment of Management Servicesis
2993    authorized and directed to survey other state retirement systems
2994    to determine if such retirement systems are interested in
2995    developing an interstate compact with Florida.
2996          (b) If any such state is interested in pursuing the
2997    matter, the divisiondepartmentshall confer with the other
2998    state and the consulting actuaries of both states, and shall
2999    present its findings to the committees having jurisdiction over
3000    retirement matters in the Legislature, and to representatives of
3001    affected certified bargaining units, in order to determine the
3002    feasibility of developing a portability compact, what groups
3003    should be covered, and the goals and priorities which should
3004    guide such development.
3005          (c) Upon a determination that such a compact is feasible
3006    and upon request of the Legislature, the divisiondepartment,
3007    together with its consulting actuaries, shall, in accordance
3008    with suchsaidgoals and priorities, develop a proposal under
3009    which retirement credit may be transferred to or from Florida in
3010    an actuarially sound manner.
3011          (d) Once a proposal has been developed, the division
3012    departmentshall contract with its consulting actuaries to
3013    conduct an actuarial study of the proposal to determine the cost
3014    to the Florida Retirement System Trust Fund and the State of
3015    Florida.
3016          (e) After the actuarial study has been completed, the
3017    divisiondepartmentshall present its findings and the actuarial
3018    study to the Legislature for consideration. If either house of
3019    the Legislature elects to enter into such a compact, it shall be
3020    introduced in the form of a proposed committee bill to the full
3021    Legislature during the same or next regular session.
3022          Section 47. Subsection (2), paragraphs (a), (b), and (c)
3023    of subsection (4), paragraph (a) of subsection (5), paragraphs
3024    (a), (b), (c), and (e) of subsection (8), paragraph (c) of
3025    subsection (9), paragraphs (a), (c), and (f) of subsection (10),
3026    subsection (11), and paragraph (b) of subsection (12) of section
3027    121.4501, Florida Statutes, are amended to read:
3028          121.4501 Public Employee Optional Retirement Program.--
3029          (2) DEFINITIONS.--As used in this part, the term:
3030          (a) "Approved provider" or "provider" means a private
3031    sector company that is selected and approved by the division
3032    state boardto offer one or more investment products or services
3033    to the Public Employee Optional Retirement Program. The term
3034    includes a bundled provider that offers participants a range of
3035    individually allocated or unallocated investment products and
3036    may offer a range of administrative and customer services, which
3037    may include accounting and administration of individual
3038    participant benefits and contributions; individual participant
3039    recordkeeping; asset purchase, control, and safekeeping; direct
3040    execution of the participant's instructions as to asset and
3041    contribution allocation; calculation of daily net asset values;
3042    direct access to participant account information; periodic
3043    reporting to participants, at least quarterly, on account
3044    balances and transactions; guidance, advice, and allocation
3045    services directly relating to its own investment options or
3046    products, but only if the bundled provider complies with the
3047    standard of care of s. 404(a)(1)(A-B) of the Employee Retirement
3048    Income Security Act of 1974 (ERISA) and if providing such
3049    guidance, advice, or allocation services does not constitute a
3050    prohibited transaction under s. 4975(c)(1) of the Internal
3051    Revenue Code or s. 406 of ERISA, notwithstanding that such
3052    prohibited transaction provisions do not apply to the optional
3053    retirement program; a broad array of distribution options; asset
3054    allocation; and retirement counseling and education. Private
3055    sector companies include investment management companies,
3056    insurance companies, depositories, and mutual fund companies.
3057          (b) "Average monthly compensation" means one-twelfth of
3058    average final compensation as defined in s. 121.021(24).
3059          (c) "Covered employment" means employment in a regularly
3060    established position as defined in s. 121.021(52).
3061          (d) "Department" means the Department of Management
3062    Services.
3063          (d)(e) "Division" means the Division of Retirement of the
3064    State Board of Administrationwithin the Department of
3065    Management Services.
3066          (e)(f)"Eligible employee" means an officer or employee,
3067    as defined in s. 121.021(11), who:
3068          1. Is a member of, or is eligible for membership in, the
3069    Florida Retirement System, including any renewed member of the
3070    Florida Retirement System;
3071          2. Participates in, or is eligible to participate in, the
3072    Senior Management Service Optional Annuity Program as
3073    established under s. 121.055(6); or
3074          3. Is eligible to participate in, but does not participate
3075    in, the State University System Optional Retirement Program
3076    established under s. 121.35 or the State Community College
3077    System Optional Retirement Program established under s.
3078    121.051(2)(c).
3079         
3080          The term does not include any member participating in the
3081    Deferred Retirement Option Program established under s.
3082    121.091(13) or any employee participating in an optional
3083    retirement program established under s. 121.051(2)(c) or s.
3084    121.35.
3085          (f)(g)"Employer" means an employer, as defined in s.
3086    121.021(10), of an eligible employee.
3087          (g)(h)"Participant" means an eligible employee who elects
3088    to participate in the Public Employee Optional Retirement
3089    Program and enrolls in such optional program as provided in
3090    subsection (4).
3091          (h)(i)"Public Employee Optional Retirement Program,"
3092    "optional program," or "optional retirement program" means the
3093    alternative defined contribution retirement program established
3094    under this section.
3095          (i)(j)"State board" or "board" means the State Board of
3096    Administration.
3097          (j)(k)"Trustees" means Trustees of the State Board of
3098    Administration.
3099          (k)(l)"Vested" or "vesting" means the guarantee that a
3100    participant is eligible to receive a retirement benefit upon
3101    completion of the required years of service under the Public
3102    Employee Optional Retirement Program.
3103          (4) PARTICIPATION; ENROLLMENT.--
3104          (a)1. With respect to an eligible employee who is employed
3105    in a regularly established position on June 1, 2002, by a state
3106    employer:
3107          a. Any such employee may elect to participate in the
3108    Public Employee Optional Retirement Program in lieu of retaining
3109    his or her membership in the defined benefit program of the
3110    Florida Retirement System. The election must be made in writing
3111    or by electronic means and must be filed with the third-party
3112    administrator by August 31, 2002, or, in the case of an active
3113    employee who is on a leave of absence on April 1, 2002, by
3114    August 31, 2002, or within 90 days after the conclusion of the
3115    leave of absence, whichever is later. This election is
3116    irrevocable, except as provided in paragraph (e). Upon making
3117    such election, the employee shall be enrolled as a participant
3118    of the Public Employee Optional Retirement Program, the
3119    employee's membership in the Florida Retirement System shall be
3120    governed by the provisions of this part, and the employee's
3121    membership in the defined benefit program of the Florida
3122    Retirement System shall terminate. The employee's enrollment in
3123    the Public Employee Optional Retirement Program shall be
3124    effective the first day of the month for which a full month's
3125    employer contribution is made to the optional program.
3126          b. Any such employee who fails to elect to participate in
3127    the Public Employee Optional Retirement Program within the
3128    prescribed time period is deemed to have elected to retain
3129    membership in the defined benefit program of the Florida
3130    Retirement System, and the employee's option to elect to
3131    participate in the optional program is forfeited.
3132          2. With respect to employees who become eligible to
3133    participate in the Public Employee Optional Retirement Program
3134    by reason of employment in a regularly established position with
3135    a state employer commencing after April 1, 2002:
3136          a. Any such employee shall, by default, be enrolled in the
3137    defined benefit retirement program of the Florida Retirement
3138    System at the commencement of employment, and may, by the end of
3139    the 5th month following the employee's month of hire, elect to
3140    participate in the Public Employee Optional Retirement Program.
3141    The employee's election must be made in writing or by electronic
3142    means and must be filed with the third-party administrator. The
3143    election to participate in the optional program is irrevocable,
3144    except as provided in paragraph (e).
3145          b. If the employee files such election within the
3146    prescribed time period, enrollment in the optional program shall
3147    be effective on the first day of employment. The employer
3148    retirement contributions paid through the month of the employee
3149    plan change shall be transferred to the optional program, and,
3150    effective the first day of the next month, the employer shall
3151    pay the applicable contributions based on the employee
3152    membership class in the optional program.
3153          c. Any such employee who fails to elect to participate in
3154    the Public Employee Optional Retirement Program within the
3155    prescribed time period is deemed to have elected to retain
3156    membership in the defined benefit program of the Florida
3157    Retirement System, and the employee's option to elect to
3158    participate in the optional program is forfeited.
3159          3. For purposes of this paragraph, "state employer" means
3160    any agency, board, branch, commission, community college,
3161    department, institution, institution of higher education, or
3162    water management district of the state, which participates in
3163    the Florida Retirement System for the benefit of certain
3164    employees.
3165          (b)1. With respect to an eligible employee who is employed
3166    in a regularly established position on September 1, 2002, by a
3167    district school board employer:
3168          a. Any such employee may elect to participate in the
3169    Public Employee Optional Retirement Program in lieu of retaining
3170    his or her membership in the defined benefit program of the
3171    Florida Retirement System. The election must be made in writing
3172    or by electronic means and must be filed with the third-party
3173    administrator by November 30, or, in the case of an active
3174    employee who is on a leave of absence on July 1, 2002, by
3175    November 30, 2002, or within 90 days after the conclusion of the
3176    leave of absence, whichever is later. This election is
3177    irrevocable, except as provided in paragraph (e). Upon making
3178    such election, the employee shall be enrolled as a participant
3179    of the Public Employee Optional Retirement Program, the
3180    employee's membership in the Florida Retirement System shall be
3181    governed by the provisions of this part, and the employee's
3182    membership in the defined benefit program of the Florida
3183    Retirement System shall terminate. The employee's enrollment in
3184    the Public Employee Optional Retirement Program shall be
3185    effective the first day of the month for which a full month's
3186    employer contribution is made to the optional program.
3187          b. Any such employee who fails to elect to participate in
3188    the Public Employee Optional Retirement Program within the
3189    prescribed time period is deemed to have elected to retain
3190    membership in the defined benefit program of the Florida
3191    Retirement System, and the employee's option to elect to
3192    participate in the optional program is forfeited.
3193          2. With respect to employees who become eligible to
3194    participate in the Public Employee Optional Retirement Program
3195    by reason of employment in a regularly established position with
3196    a district school board employer commencing after July 1, 2002:
3197          a. Any such employee shall, by default, be enrolled in the
3198    defined benefit retirement program of the Florida Retirement
3199    System at the commencement of employment, and may, by the end of
3200    the 5th month following the employee's month of hire, elect to
3201    participate in the Public Employee Optional Retirement Program.
3202    The employee's election must be made in writing or by electronic
3203    means and must be filed with the third-party administrator. The
3204    election to participate in the optional program is irrevocable,
3205    except as provided in paragraph (e).
3206          b. If the employee files such election within the
3207    prescribed time period, enrollment in the optional program shall
3208    be effective on the first day of employment. The employer
3209    retirement contributions paid through the month of the employee
3210    plan change shall be transferred to the optional program, and,
3211    effective the first day of the next month, the employer shall
3212    pay the applicable contributions based on the employee
3213    membership class in the optional program.
3214          c. Any such employee who fails to elect to participate in
3215    the Public Employee Optional Retirement Program within the
3216    prescribed time period is deemed to have elected to retain
3217    membership in the defined benefit program of the Florida
3218    Retirement System, and the employee's option to elect to
3219    participate in the optional program is forfeited.
3220          3. For purposes of this paragraph, "district school board
3221    employer" means any district school board that participates in
3222    the Florida Retirement System for the benefit of certain
3223    employees, or a charter school or charter technical career
3224    center that participates in the Florida Retirement System as
3225    provided in s. 121.051(2)(d).
3226          (c)1. With respect to an eligible employee who is employed
3227    in a regularly established position on December 1, 2002, by a
3228    local employer:
3229          a. Any such employee may elect to participate in the
3230    Public Employee Optional Retirement Program in lieu of retaining
3231    his or her membership in the defined benefit program of the
3232    Florida Retirement System. The election must be made in writing
3233    or by electronic means and must be filed with the third-party
3234    administrator by February 28, 2003, or, in the case of an active
3235    employee who is on a leave of absence on October 1, 2002, by
3236    February 28, 2003, or within 90 days after the conclusion of the
3237    leave of absence, whichever is later. This election is
3238    irrevocable, except as provided in paragraph (e). Upon making
3239    such election, the employee shall be enrolled as a participant
3240    of the Public Employee Optional Retirement Program, the
3241    employee's membership in the Florida Retirement System shall be
3242    governed by the provisions of this part, and the employee's
3243    membership in the defined benefit program of the Florida
3244    Retirement System shall terminate. The employee's enrollment in
3245    the Public Employee Optional Retirement Program shall be
3246    effective the first day of the month for which a full month's
3247    employer contribution is made to the optional program.
3248          b. Any such employee who fails to elect to participate in
3249    the Public Employee Optional Retirement Program within the
3250    prescribed time period is deemed to have elected to retain
3251    membership in the defined benefit program of the Florida
3252    Retirement System, and the employee's option to elect to
3253    participate in the optional program is forfeited.
3254          2. With respect to employees who become eligible to
3255    participate in the Public Employee Optional Retirement Program
3256    by reason of employment in a regularly established position with
3257    a local employer commencing after October 1, 2002:
3258          a. Any such employee shall, by default, be enrolled in the
3259    defined benefit retirement program of the Florida Retirement
3260    System at the commencement of employment, and may, by the end of
3261    the 5th month following the employee's month of hire, elect to
3262    participate in the Public Employee Optional Retirement Program.
3263    The employee's election must be made in writing or by electronic
3264    means and must be filed with the third-party administrator. The
3265    election to participate in the optional program is irrevocable,
3266    except as provided in paragraph (e).
3267          b. If the employee files such election within the
3268    prescribed time period, enrollment in the optional program shall
3269    be effective on the first day of employment. The employer
3270    retirement contributions paid through the month of the employee
3271    plan change shall be transferred to the optional program, and,
3272    effective the first day of the next month, the employer shall
3273    pay the applicable contributions based on the employee
3274    membership class in the optional program.
3275          c. Any such employee who fails to elect to participate in
3276    the Public Employee Optional Retirement Program within the
3277    prescribed time period is deemed to have elected to retain
3278    membership in the defined benefit program of the Florida
3279    Retirement System, and the employee's option to elect to
3280    participate in the optional program is forfeited.
3281          3. For purposes of this paragraph, "local employer" means
3282    any employer not included in paragraph (a) or paragraph (b).
3283          (5) CONTRIBUTIONS.--
3284          (a) Each employer shall contribute on behalf of each
3285    participant in the Public Employee Optional Retirement Program,
3286    as provided in part III of this chapter. The state board, acting
3287    as plan fiduciary, shall ensure that all plan assets are held in
3288    a trust, pursuant to s. 401 of the Internal Revenue Code. The
3289    fiduciary shall ensure that said contributions are allocated as
3290    follows:
3291          1. The portion earmarked for participant accounts shall be
3292    used to purchase interests in the appropriate investment
3293    vehicles for the accounts of each participant as specified by
3294    the participant, or in accordance with paragraph (4)(d).
3295          2. The portion earmarked for administrative and
3296    educational expenses shall be transferred to the board.
3297          3. The portion earmarked for disability benefits shall be
3298    transferred to the divisiondepartment.
3299          (8) ADMINISTRATION OF PROGRAM.--
3300          (a) The Public Employee Optional Retirement Program shall
3301    be administered by the state board and affected employers. The
3302    board is authorized to require oaths, by affidavit or otherwise,
3303    and acknowledgments from persons in connection with the
3304    administration of its duties and responsibilities under this
3305    chapter. No oath, by affidavit or otherwise, shall be required
3306    of an employee participant at the time of election.
3307    Acknowledgment of an employee's election to participate in the
3308    program shall be no greater than necessary to confirm the
3309    employee's election. The board shall adopt rules establishing
3310    the role and responsibilities of affected state, local
3311    government, and education-related employers, the state board,
3312    the divisiondepartment, and third-party contractors in
3313    administering the Public Employee Optional Retirement Program.
3314    The divisiondepartmentshall adopt rules necessary to implement
3315    the optional program in coordination with the defined benefit
3316    retirement program and the disability benefits available under
3317    the optional program.
3318          (b)1. The state board shall select and contract with one
3319    third-party administrator to provide administrative services if
3320    those services cannot be competitively and contractually
3321    provided by the Division of Retirement within the Department of
3322    Management Services. With the approval of the state board, the
3323    third-party administrator may subcontract with other
3324    organizations or individuals to provide components of the
3325    administrative services. As a cost of administration, the board
3326    may compensate any such contractor for its services, in
3327    accordance with the terms of the contract, as is deemed
3328    necessary or proper by the board. The third-party administrator
3329    may not be an approved provider or be affiliated with an
3330    approved provider.
3331          2. These administrative services may include, but are not
3332    limited to, enrollment of eligible employees, collection of
3333    employer contributions, disbursement of such contributions to
3334    approved providers in accordance with the allocation directions
3335    of participants; services relating to consolidated billing;
3336    individual and collective recordkeeping and accounting; asset
3337    purchase, control, and safekeeping; and direct disbursement of
3338    funds to and from the third-party administrator, the division,
3339    the board, employers, participants, approved providers, and
3340    beneficiaries. This section does not prevent or prohibit a
3341    bundled provider from providing any administrative or customer
3342    service, including accounting and administration of individual
3343    participant benefits and contributions; individual participant
3344    recordkeeping; asset purchase, control, and safekeeping; direct
3345    execution of the participant's instructions as to asset and
3346    contribution allocation; calculation of daily net asset values;
3347    direct access to participant account information; or periodic
3348    reporting to participants, at least quarterly, on account
3349    balances and transactions, if these services are authorized by
3350    the board as part of the contract.
3351          3. The state board shall select and contract with one or
3352    more organizations to provide educational services. With
3353    approval of the board, the organizations may subcontract with
3354    other organizations or individuals to provide components of the
3355    educational services. As a cost of administration, the board may
3356    compensate any such contractor for its services in accordance
3357    with the terms of the contract, as is deemed necessary or proper
3358    by the board. The education organization may not be an approved
3359    provider or be affiliated with an approved provider.
3360          4. Educational services shall be designed by the board and
3361    departmentto assist employers, eligible employees,
3362    participants, and beneficiaries in order to maintain compliance
3363    with United States Department of Labor regulations under s.
3364    404(c) of the Employee Retirement Income Security Act of 1974
3365    and to assist employees in their choice of defined benefit or
3366    defined contribution retirement alternatives. Educational
3367    services include, but are not limited to, disseminating
3368    educational materials; providing retirement planning education;
3369    explaining the differences between the defined benefit
3370    retirement plan and the defined contribution retirement plan;
3371    and offering financial planning guidance on matters such as
3372    investment diversification, investment risks, investment costs,
3373    and asset allocation. An approved provider may also provide
3374    educational information, including retirement planning and
3375    investment allocation information concerning its products and
3376    services.
3377          (c)1. In evaluating and selecting a third-party
3378    administrator, the board shall establish criteria under which it
3379    shall consider the relative capabilities and qualifications of
3380    each proposed administrator. In developing such criteria, the
3381    board shall consider:
3382          a. The administrator's demonstrated experience in
3383    providing administrative services to public or private sector
3384    retirement systems.
3385          b. The administrator's demonstrated experience in
3386    providing daily valued recordkeeping to defined contribution
3387    plans.
3388          c. The administrator's ability and willingness to
3389    coordinate its activities with the Florida Retirement System
3390    employers, the board, and the division, and to supply to such
3391    employers, the board, and the division the information and data
3392    they require, including, but not limited to, monthly management
3393    reports, quarterly participant reports, and ad hoc reports
3394    requested by the department orboard.
3395          d. The cost-effectiveness and levels of the administrative
3396    services provided.
3397          e. The administrator's ability to interact with the
3398    participants, the employers, the board, the division, and the
3399    providers; the means by which participants may access account
3400    information, direct investment of contributions, make changes to
3401    their accounts, transfer moneys between available investment
3402    vehicles, and transfer moneys between investment products; and
3403    any fees that apply to such activities.
3404          f. Any other factor deemed necessary by the Trustees of
3405    the State Board of Administration.
3406          g. The recommendations of the Public Employee Optional
3407    Retirement Program Advisory Committee established in subsection
3408    (12).
3409          2. In evaluating and selecting an educational provider,
3410    the board shall establish criteria under which it shall consider
3411    the relative capabilities and qualifications of each proposed
3412    educational provider. In developing such criteria, the board
3413    shall consider:
3414          a. Demonstrated experience in providing educational
3415    services to public or private sector retirement systems.
3416          b. Ability and willingness to coordinate its activities
3417    with the Florida Retirement System employers, the board, and the
3418    division, and to supply to such employers, the board, and the
3419    division the information and data they require, including, but
3420    not limited to, reports on educational contacts.
3421          c. The cost-effectiveness and levels of the educational
3422    services provided.
3423          d. Ability to provide educational services via different
3424    media, including, but not limited to, the Internet, personal
3425    contact, seminars, brochures, and newsletters.
3426          e. Any other factor deemed necessary by the Trustees of
3427    the State Board of Administration.
3428          f. The recommendations of the Public Employee Optional
3429    Retirement Program Advisory Committee established in subsection
3430    (12).
3431          3. The establishment of the criteria shall be solely
3432    within the discretion of the board.
3433          (e)1. The board may contract with any consultant for
3434    professional services, including legal, consulting, accounting,
3435    and actuarial services, deemed necessary to implement and
3436    administer the optional program by the Trustees of the State
3437    Board of Administration. The board may enter into a contract
3438    with one or more vendors to provide low-cost investment advice
3439    to participants, supplemental to education provided by the
3440    third-party administrator. All fees under any such contract
3441    shall be paid by those participants who choose to use the
3442    services of the vendor.
3443          2. The boarddepartmentmay contract with consultants for
3444    professional services, including legal, consulting, accounting,
3445    and actuarial services, deemed necessary to implement and
3446    administer the optional program in coordination with the defined
3447    benefit program of the Florida Retirement System. The division
3448    department, in coordination with the board, may enter into a
3449    contract with the third-party administrator in order to
3450    coordinate services common to the various programs within the
3451    Florida Retirement System.
3452          (9) INVESTMENT OPTIONS OR PRODUCTS; PERFORMANCE REVIEW.--
3453          (c) In evaluating and selecting approved providers and
3454    products, the board shall establish criteria under which it
3455    shall consider the relative capabilities and qualifications of
3456    each proposed provider company and product. In developing such
3457    criteria, the board shall consider the following to the extent
3458    such factors may be applied in connection with investment
3459    products, services, or providers:
3460          1. Experience in the United States providing retirement
3461    products and related financial services under defined
3462    contribution retirement plans.
3463          2. Financial strength and stability which shall be
3464    evidenced by the highest ratings assigned by nationally
3465    recognized rating services when comparing proposed providers
3466    that are so rated.
3467          3. Intrastate and interstate portability of the product
3468    offered, including early withdrawal options.
3469          4. Compliance with the Internal Revenue Code.
3470          5. The cost-effectiveness of the product provided and the
3471    levels of service supporting the product relative to its
3472    benefits and its characteristics, including, without limitation,
3473    the level of risk borne by the provider.
3474          6. The provider company's ability and willingness to
3475    coordinate its activities with Florida Retirement System
3476    employers, the divisiondepartment, and the board, and to supply
3477    to such employers, the divisiondepartment, and the board the
3478    information and data they require.
3479          7. The methods available to participants to interact with
3480    the provider company; the means by which participants may access
3481    account information, direct investment of contributions, make
3482    changes to their accounts, transfer moneys between available
3483    investment vehicles, and transfer moneys between provider
3484    companies; and any fees that apply to such activities.
3485          8. The provider company's policies with respect to the
3486    transfer of individual account balances, contributions, and
3487    earnings thereon, both internally among investment products
3488    offered by the provider company and externally between approved
3489    providers, as well as any fees, charges, reductions, or
3490    penalties that may be applied.
3491          9. An evaluation of specific investment products, taking
3492    into account each product's experience in meeting its investment
3493    return objectives net of all related fees, expenses, and
3494    charges, including, but not limited to, investment management
3495    fees, loads, distribution and marketing fees, custody fees,
3496    recordkeeping fees, education fees, annuity expenses, and
3497    consulting fees.
3498          10. Organizational factors, including, but not limited to,
3499    financial solvency, organizational depth, and experience in
3500    providing institutional and retail investment services.
3501          (10) EDUCATION COMPONENT.--
3502          (a) The board, in coordination with the department,shall
3503    provide for an education component for system members in a
3504    manner consistent with the provisions of this section. The
3505    education component must be available to eligible employees at
3506    least 90 days prior to the beginning date of the election period
3507    for the employees of the respective types of employers.
3508          (c) The board, in coordination with the department,shall
3509    provide for an initial and ongoing transfer education component
3510    to provide system members with information necessary to make
3511    informed plan choice decisions. The transfer education component
3512    must include, but is not limited to, information on:
3513          1. The amount of money available to a member to transfer
3514    to the defined contribution program.
3515          2. The features of and differences between the defined
3516    benefit program and the defined contribution program, both
3517    generally and specifically, as those differences may affect the
3518    member.
3519          3. The expected benefit available if the member were to
3520    retire under each of the retirement programs, based on
3521    appropriate alternative sets of assumptions.
3522          4. The rate of return from investments in the defined
3523    contribution program and the period of time over which such rate
3524    of return must be achieved to equal or exceed the expected
3525    monthly benefit payable to the member under the defined benefit
3526    program.
3527          5. The historical rates of return for the investment
3528    alternatives available in the defined contribution programs.
3529          6. The benefits and historical rates of return on
3530    investments available in a typical deferred compensation plan or
3531    a typical plan under s. 403(b) of the Internal Revenue Code for
3532    which the employee may be eligible.
3533          7. The program choices available to employees of the State
3534    University System and the comparative benefits of each available
3535    program, if applicable.
3536          8. Payout options available in each of the retirement
3537    programs.
3538          (f) The board and the departmentshall also establish a
3539    communication component to provide program information to
3540    participating employers and the employers' personnel and payroll
3541    officers and to explain their respective responsibilities in
3542    conjunction with the retirement programs.
3543          (11) PARTICIPANT INFORMATION REQUIREMENTS.--The board
3544    shall ensure that each participant is provided a quarterly
3545    statement that accounts for the contributions made on behalf of
3546    such participant; the interest and investment earnings thereon;
3547    and any fees, penalties, or other deductions that apply thereto.
3548    At a minimum, such statements must:
3549          (a) Indicate the participant's investment options.
3550          (b) State the market value of the account at the close of
3551    the current quarter and previous quarter.
3552          (c) Show account gains and losses for the period and
3553    changes in account accumulation unit values for the period.
3554          (d) Itemize account contributions for the quarter.
3555          (e) Indicate any account changes due to adjustment of
3556    contribution levels, reallocation of contributions, balance
3557    transfers, or withdrawals.
3558          (f) Set forth any fees, charges, penalties, and deductions
3559    that apply to the account.
3560          (g) Indicate the amount of the account in which the
3561    participant is fully vested and the amount of the account in
3562    which the participant is not vested.
3563          (h) Indicate each investment product's performance
3564    relative to an appropriate market benchmark.
3565         
3566          The third-party administrator shall provide quarterly and annual
3567    summary reports to the board and any other reports requested by
3568    the department orthe board. In any solicitation or offer of
3569    coverage under an optional retirement program, a provider
3570    company shall be governed by the contract readability provisions
3571    of s. 627.4145, notwithstanding s. 627.4145(6)(c). In addition,
3572    all descriptive materials must be prepared under the assumption
3573    that the participant is an unsophisticated investor. Provider
3574    companies must maintain an internal system of quality assurance,
3575    have proven functional systems that are date-calculation
3576    compliant, and be subject to a due-diligence inquiry that proves
3577    their capacity and fitness to undertake service
3578    responsibilities.
3579          (12) ADVISORY COMMITTEES TO PROVIDE ADVICE AND
3580    ASSISTANCE.--The Investment Advisory Council and the Public
3581    Employee Optional Retirement Program Advisory Committee shall
3582    assist the board in implementing and administering the Public
3583    Employee Optional Retirement Program.
3584          (b)1. The Public Employee Optional Retirement Program
3585    Advisory Committee shall be composed of seven members. The
3586    President of the Senate shall appoint two members, the Speaker
3587    of the House of Representatives shall appoint two members, the
3588    Governor shall appoint one member, the Treasurer shall appoint
3589    one member, and the Comptroller shall appoint one member. The
3590    members of the advisory committee shall elect a member as chair.
3591    The appointments shall be made by September 1, 2000, and the
3592    committee shall meet to organize by October 1, 2000. The initial
3593    appointments shall be for a term of 24 months. Each appointing
3594    authority shall fill any vacancy occurring among its appointees
3595    for the remainder of the original term.
3596          2. The advisory committee shall make recommendations on
3597    the selection of the third-party administrator, the education
3598    providers, and the investment products and providers. The
3599    committee's recommendations on the third-party administrator
3600    must be forwarded to the Trustees of the State Board of
3601    Administration by January 1, 2001. The recommendations on the
3602    education providers must be forwarded to the trustees by April
3603    1, 2001.
3604          3. The advisory committee's recommendations and activities
3605    shall be guided by the best interests of the employees,
3606    considering the interests of employers, and the intent of the
3607    Legislature in establishing the Public Employee Optional
3608    Retirement Program.
3609          4. The staff of the state board and the departmentshall
3610    assist the advisory committee.
3611          Section 48. Subsections (1) and (6) of section 122.02,
3612    Florida Statutes, are amended to read:
3613          122.02 Definitions.--The following words and phrases as
3614    used in this chapter shall have the following meaning unless a
3615    different meaning is plainly required by the context:
3616          (1) "State and county officers and employees" shall
3617    include all full-time officers or employees who receive
3618    compensation for services rendered from state or county funds,
3619    or from funds of drainage districts or mosquito control
3620    districts of a county or counties, or from funds of the State
3621    Board of Administration or from funds of closed bank
3622    receivership accounts or from funds of any state institution or
3623    who receive compensation for employment or service from any
3624    agency, branch, department, institution or board of the state,
3625    or any county of the state, for service rendered the state or
3626    county from funds from any source provided for their employment
3627    or service regardless of whether the same is paid by state or
3628    county warrant or not; provided that such compensation in
3629    whatever form paid shall be specified in terms of fixed monthly
3630    salaries by the employing state or county agency or state or
3631    county official and shall not include amounts allowed for
3632    professional employees for special or particular service or for
3633    subsistence or travel expenses; provided further the division
3634    departmentshall prescribe appropriate procedure for
3635    contribution deduction out of such compensation in accordance
3636    with the provisions of this chapter, provided further that such
3637    officers and employees defined herein shall not include those
3638    officers and employees excepted from the provisions by s. 122.18
3639    of this law.
3640          (6) "DivisionDepartment" means the Division of Retirement
3641    Department of Management Services.
3642          Section 49. Paragraph (d) of subsection (6) and subsection
3643    (9) of section 122.03, Florida Statutes, are amended to read:
3644          122.03 Contributions; participants; prior service
3645    credit.--
3646          (6) Any officer or employee who held office or was
3647    employed by the state or a county of the state continuously from
3648    May 1, 1959, and who has not previously received credit for, or
3649    is not eligible to claim credit for, prior years of service
3650    under subsection (2); or any officer or employee who holds
3651    office or is employed by the state or a county of the state on
3652    June 1, 1961, and is continuously employed; or any officer or
3653    employee who holds office or is employed by the state or county
3654    of the state after June 1, 1961, and who is continuously
3655    employed for 3 years, during which period of time no back
3656    payments may be made:
3657          (d) Prior service allowance may be made only for those
3658    periods in which state or county records of service and salary
3659    are available, or at least three affidavits and such other
3660    information as might be required by the divisiondepartmentto
3661    meet the provisions of this law.
3662          (9) The surviving spouse or other dependent of any member
3663    whose employment is terminated by death shall, upon application
3664    to the divisiondepartment, be permitted to pay the required
3665    contributions for any service performed by the member which
3666    could have been claimed by the member at the time of death. Such
3667    service shall be added to the creditable service of the member
3668    and shall be used in the calculation of any benefits which may
3669    be payable to the surviving spouse or other surviving dependent.
3670          Section 50. Subsection (2) of section 122.05, Florida
3671    Statutes, is amended to read:
3672          122.05 Legislator services included.--
3673          (2) The divisiondepartmentand state officials
3674    administering suchsaidretirement system shall make the
3675    contribution deductions required by law from the compensation
3676    hereafter received by any of the saidparticipating members of
3677    the Legislature for service rendered the State Legislature in
3678    the same manner as in the case of other state employment.
3679          Section 51. Subsection (2) of section 122.06, Florida
3680    Statutes, is amended to read:
3681          122.06 Legislative employee services included.--
3682          (2) The divisiondepartmentand other state officials
3683    administering thesaidretirement system shall make the
3684    contribution deductions required by law from the compensation
3685    hereafter received by any of the said participating attaches for
3686    service rendered the State Legislature in the same manner as in
3687    the case of other state employment.
3688          Section 52. Subsection (2) of section 122.07, Florida
3689    Statutes, is amended to read:
3690          122.07 Seasonal state employment included; time limit and
3691    procedure for claiming.--
3692          (2) Any state employee as described in subsection (1) in
3693    the classification set forth in s. 122.01 may elect to receive
3694    credit as a state employee under the State and County Officers
3695    and Employees' Retirement System by providing to the division
3696    departmenta statement from the state in which he or she was
3697    employed, listing days employed and monthly earnings and such
3698    other information as may, in the opinion of the division
3699    department, be necessary or appropriate in the carrying out of
3700    this section. Credit shall be granted upon payment to the
3701    divisiondepartmentby such employee of an amount equal to the
3702    total retirement contribution that would have been required had
3703    the member worked in this state during the period based on the
3704    salary drawn by such employee during his or her last full month
3705    of employment by the state or any department thereof for each
3706    month during suchsaidfiscal year for which such employee was
3707    not employed by the state or any department thereof, but was
3708    employed by some other state, plus interest compounded annually
3709    each June 30 from the date of the service in another state to
3710    the date of payment at the rate of 4 percent until July 1, 1975,
3711    and 6.5 percent thereafter. The member shall have until his or
3712    her date of retirement to claim and purchase credit for such
3713    employment in another state.
3714          Section 53. Paragraph (a) of subsection (1), paragraph (b)
3715    of subsection (4), and subsections (5) and (9) of section
3716    122.08, Florida Statutes, are amended to read:
3717          122.08 Requirements for retirement;
3718    classifications.--There shall be two retirement classifications
3719    for all state and county officers and employees participating
3720    herein as hereafter provided in this section:
3721          (1)(a) Any state or county officer or employee who has
3722    attained normal retirement age, which shall be age 60 for a
3723    person who had become a member prior to July 1, 1963, and age 62
3724    for a person who had or shall become a member on or after July
3725    1, 1963, and has accumulated at least 10 years' service in the
3726    aggregate within the contemplation of this law, and who has made
3727    or makes contributions to the State and County Officers and
3728    Employees' Retirement Trust Fund for 5 or more years as
3729    prescribed in this law, may voluntarily retire from office or
3730    employment and be entitled to receive retirement compensation,
3731    the amount of which shall be 2 percent for each year of service
3732    rendered, based upon the average final compensation, payable in
3733    equal monthly installments, upon his or her own requisition.
3734    Requisition requirements shall be set by the division
3735    department.
3736          (4)
3737          (b) A member who elects an option in paragraph (a) shall
3738    on a form provided for that purpose designate his or her spouse
3739    as beneficiary to receive the benefits which continue to be
3740    payable upon the death of the member. After such benefits have
3741    commenced under an option in paragraph (a), the retired member
3742    may change the designation of his or her spouse as beneficiary
3743    only twice. If such a retired member remarries and wishes to
3744    make such a change, he or she may do so by filing with the
3745    divisiondepartmenta notarized change of spouse designation
3746    form and shall notify the former spouse in writing of such
3747    change. Upon receipt of a completed change of spouse designation
3748    form, the divisiondepartmentshall adjust the member's monthly
3749    benefit by the application of actuarial tables and calculations
3750    developed to ensure that the benefit paid is the actuarial
3751    equivalent of the present value of the member's current benefit.
3752    The consent of a retired member's formerly designated spouse as
3753    beneficiary to any such change shall not be required.
3754          (5) Tables for computing the actuarial equivalent shall be
3755    approved by the divisiondepartment.
3756          (9) Notwithstanding any other provision in this chapter to
3757    the contrary, the following provisions shall apply to any
3758    officer or employee who has accumulated at least 10 years of
3759    service and dies:
3760          (a) If the deceased member's surviving spouse has
3761    previously received a refund of the member's contributions made
3762    to the retirement trust fund, such spouse may pay to the
3763    divisiondepartmentan amount equal to the sum of the amount of
3764    the deceased member's contributions previously refunded and
3765    interest at 3 percent compounded annually on the amount of such
3766    refunded contributions from the date of refund until July 1,
3767    1975, and thereafter at the rate of 6.5 percent interest
3768    compounded annually to the date of payment to the division
3769    department, and by so doing be entitled to receive the monthly
3770    retirement benefit provided in paragraph (c).
3771          (b) If the deceased member's surviving spouse has not
3772    received a refund of the deceased member's contributions, such
3773    spouse shall, upon application to the divisiondepartment,
3774    receive the monthly retirement benefit provided in paragraph
3775    (c).
3776          (c) The monthly benefit payable to the spouse described in
3777    paragraph (a) or paragraph (b) shall be the amount which would
3778    have been payable to the deceased member's spouse, assuming that
3779    the member retired on the date of death and had selected the
3780    option in subsection (4) which would afford the surviving spouse
3781    the greatest amount of benefits, such benefit to be based on the
3782    ages of the spouse and member as of the date of death of the
3783    member. Such benefit shall commence on the first day of the
3784    month following the payment of the aforesaid amount to the
3785    divisiondepartment, if paragraph (a) is applicable, or on the
3786    first day of the month following the receipt of the spouse's
3787    application by the divisiondepartment, if paragraph (b) is
3788    applicable.
3789          Section 54. Section 122.09, Florida Statutes, is amended
3790    to read:
3791          122.09 Disability retirement; medical
3792    examinations.--Whenever any officer or employee of the state or
3793    county of the state has service credit as such officer or
3794    employee for 10 years within the contemplation of this law, the
3795    last 5 years of which, except for a single break not to exceed 1
3796    year, must be continuous, unbroken service and who is regularly
3797    contributing to the State and County Officers and Employees'
3798    Retirement Trust Fund and shall while holding such office or
3799    employment become permanently and totally disabled, physically
3800    or mentally, or both, from rendering useful and efficient
3801    service as such officer or employee, such officer or employee
3802    may retire from his or her office or employment, and upon such
3803    retirement the officer or employee shall be paid, so long as the
3804    permanent and total disability continues, on his or her own
3805    monthly requisition, from the State and County Officers and
3806    Employees' Retirement Trust Fund hereinafter established,
3807    retirement compensation as provided in s. 122.08; provided that
3808    no officer or employee retiring under this section shall receive
3809    less than 50 percent of his or her average final compensation
3810    not to exceed $75. No officer or employee of the state and
3811    county of the state shall be permitted to retire under the
3812    provisions of this section until examined by a duly qualified
3813    physician or surgeon or board of physicians and surgeons, to be
3814    selected by the Governor for that purpose, and found to be
3815    disabled in the degree and in the manner specified in this
3816    section. Any officer or employee retiring under this section
3817    shall be examined periodically by a duly qualified physician or
3818    surgeon or board of physicians and surgeons to be selected by
3819    the Governor for that purpose and paid from the retirement trust
3820    fund herein provided for, at such time as the division directs
3821    Department of Management Services shall directto determine if
3822    such total disability has continued and in the event it be
3823    disclosed by said examination that said total disability has
3824    ceased to exist, then such officer or employee shall forthwith
3825    cease to be paid benefits under this section. Reference to s.
3826    122.08 is for the purpose of computing benefits only. Any person
3827    heretofore retired under this section shall be eligible to
3828    qualify for the minimum benefits provided herein; however,
3829    minimum benefits shall not be paid retroactively.
3830          Section 55. Subsection (4) of section 122.10, Florida
3831    Statutes, is amended to read:
3832          122.10 Separation from service; refund of contributions.--
3833          (4) IfShould any officer or employee electselectto
3834    receive a refund as provided in this section, his or her
3835    application for refund shall be submitted in the manner
3836    prescribed by the rulesregulations adopted by the division
3837    departmentand shall accompany the payroll certification,
3838    submitted to the divisiondepartment, on which he or she was
3839    last paid prior to termination. The divisiondepartmentshall
3840    pay the entire refund due within 45 days after the first day of
3841    the month subsequent to receipt of such application for refund
3842    and said payroll certification.
3843          Section 56. Subsection (1) of section 122.12, Florida
3844    Statutes, is amended to read:
3845          122.12 Designation of beneficiary; death of participant;
3846    forfeiture of contributions after benefits paid; survivor
3847    benefits.--
3848          (1) Any officer or employee may file, in writing, a
3849    designation of beneficiary and it shall be the duty of the
3850    divisiondepartmentto refund 100 percent, without interest, of
3851    the contributions made to the retirement trust fund by such
3852    deceased officer or employee to such designated beneficiary. The
3853    officer or employee shall have the privilege of changing, in
3854    writing, the designated beneficiary at any time. Upon failure to
3855    designate a beneficiary, the refund shall be made to the persons
3856    in the same order as designated in s. 222.15, for wages due
3857    deceased employees. If the deceased officer or employee has
3858    received any benefits under this law, no refund shall be made
3859    unless such officer or employee has elected to accept benefits
3860    under s. 122.08(3) or (4).
3861          Section 57. Section 122.13, Florida Statutes, is amended
3862    to read:
3863          122.13 Administration of law; appropriation.--The division
3864    departmentshall make such rules as are necessary for the
3865    effective administration of this chapter, and the cost is hereby
3866    annually appropriated and shall be paid into the State and
3867    County Officers and Employees' Retirement Trust Fund out of the
3868    Intangible Tax Fund in the State Treasury in the amount
3869    necessary to administer efficiently the state and county
3870    retirement law. At the end of each fiscal year, beginning with
3871    fiscal year 1959-1960, the administrative cost of the state and
3872    county retirement system for the fiscal year just ended shall be
3873    refunded to the General Revenue Fund from interest earned on
3874    investments made subsequent to June 30, 1959.
3875          Section 58. Subsection (2) of section 122.15, Florida
3876    Statutes, is amended to read:
3877          122.15 Benefits exempt from taxes and execution.--
3878          (2) This subsection shall have no effect upon this section
3879    except that the divisiondepartmentmay, upon written request
3880    from the retired member, deduct premiums for group
3881    hospitalization insurance from the retirement benefit paid such
3882    retired member.
3883          Section 59. Paragraph (b) of subsection (2) of section
3884    122.16, Florida Statutes, is amended to read:
3885          122.16 Employment after retirement.--
3886          (2)
3887          (b) Any person to whom the limitation in paragraph (a)
3888    applies who violates such reemployment limitation and is
3889    reemployed with any agency participating in the Florida
3890    Retirement System prior to completion of the 12-month limitation
3891    period shall give timely notice of this fact in writing to his
3892    or her employer and to the divisiondepartment; and his or her
3893    retirement benefits shall be suspended for the balance of the
3894    12-month limitation period. Any person employed in violation of
3895    this subsection and any employing agency which knowingly employs
3896    or appoints such person without notifying the division
3897    departmentto suspend retirement benefits shall be jointly and
3898    severally liable for reimbursement to the retirement trust fund
3899    of any benefits paid during the reemployment limitation period.
3900    To avoid liability, such employing agency shall have a written
3901    statement from the retiree that he or she is not retired from a
3902    state-administered retirement system. Any retirement benefits
3903    received by such person while he or she is reemployed during
3904    this reemployment limitation period shall be repaid to the
3905    retirement trust fund, and his or her retirement benefits shall
3906    remain suspended until such repayment has been made. Any
3907    benefits suspended beyond the reemployment limitation period
3908    shall apply toward the repayment of benefits received in
3909    violation of the reemployment limitation.
3910          Section 60. Subsections (3) and (5) of section 122.23,
3911    Florida Statutes, are amended to read:
3912          122.23 Definitions; ss. 122.21-122.321.--In addition to
3913    those definitions set forth in s. 122.02 the following words and
3914    phrases used in ss. 122.21-122.24, 122.26 to 122.321, inclusive,
3915    have the respective meanings set forth:
3916          (3) "DivisionDepartment" means the Division of Retirement
3917    of the State Board of AdministrationDepartment of Management
3918    Services.
3919          (5) "State agency" means the divisionDepartment of
3920    Management Serviceswithin the provisions and contemplation of
3921    chapter 650.
3922          Section 61. Subsections (1) and (5) of section 122.30,
3923    Florida Statutes, are amended to read:
3924          122.30 Appropriations.--
3925          (1) There is herebyannually appropriated from the
3926    intangible tax fund of the state to the divisiondepartmentas
3927    the state agency designated in chapter 650, a sum not to exceed
3928    $10,000 to defray the expenses of such agency in connection with
3929    its continuing duties in relation to the social security
3930    coverage provided by this law.
3931          (5) In addition to amounts appropriated by other
3932    provisions of this chapter or other laws to defray cost of
3933    administration of this system, there is herebyappropriated out
3934    of the Intangible Tax Fund of the state for use of the division
3935    departmentin its administration of the two divisions of this
3936    system, the sum of $100,000, or so much thereof as may be
3937    required for that purpose.
3938          Section 62. Paragraphs (b) and (c) of subsection (1) and
3939    subsection (11) of section 122.34, Florida Statutes, are amended
3940    to read:
3941          122.34 Special provisions for certain sheriffs and full-
3942    time deputy sheriffs.--
3943          (1)
3944          (b) Only those members who are full-time criminal law
3945    enforcement officers or agents, as certified by the employing
3946    authority, who perform duties according to rule, order, or
3947    established custom as full-time criminal law enforcement
3948    officers or agents shall be certified to the divisiondepartment
3949    as high hazard members, and only such members will be approved
3950    by the divisiondepartment.
3951          (c) The divisiondepartmentshall make such rules as are
3952    necessary for the effective administration of the intent of this
3953    section.
3954          (11) No high hazard member shall be permitted to receive
3955    benefits under this section until examined by a duly qualified
3956    physician or surgeon, or board of physicians and surgeons, to be
3957    selected by the Governor for that purpose, and found to be
3958    disabled in the degree and in the manner specified in this
3959    section. At such time as the divisionDepartment of Management
3960    Servicesdirects, any high hazard member receiving disability
3961    benefits under this section shall submit to a medical
3962    examination to determine if such disability has continued, and
3963    the cost of such examination shall be paid from the retirement
3964    trust fund herein provided for; and in the event it is declared
3965    by suchsaid examination that suchsaiddisability has cleared,
3966    such member shall be ordered to return to active duty with the
3967    same rank and salary that he or she had at the time of
3968    disability. Any such member who shall fail to return to duty
3969    following such order shall forfeit all rights and claims under
3970    this law. Every high hazard member retiring under this provision
3971    shall be paid so long as the member's permanent total or partial
3972    disability continues, on his or her own requisition.
3973          Section 63. Section 122.351, Florida Statutes, is amended
3974    to read:
3975          122.351 Funding by local agencies.--Commencing on July 1,
3976    1969, all county and local agencies covered under the provisions
3977    of s. 122.35 shall accumulate and be responsible for the payment
3978    of social security and retirement matching costs as required
3979    under s. 122.35, from the intangible tax allocation of that
3980    county and any other source available to the local governmental
3981    units, except that all agencies, other than the school boards,
3982    shall be given credit for 50 percent of their 1967-1969 actual
3983    employer matching cost, actual cost being that cost in cash
3984    actually paid by the employer for matching retirement and social
3985    security into the fund by the agency for suchsaidbiennium. The
3986    above credit of 50 percent shall be calculated by the division
3987    department.
3988          Section 64. Subsection (6) of section 175.032, Florida
3989    Statutes, is amended to read:
3990          175.032 Definitions.--For any municipality, special fire
3991    control district, chapter plan, local law municipality, local
3992    law special fire control district, or local law plan under this
3993    chapter, the following words and phrases have the following
3994    meanings:
3995          (6) "Division" means the Division of Retirement of the
3996    State Board of AdministrationDepartment of Management Services.
3997          Section 65. Section 175.1215, Florida Statutes, is amended
3998    to read:
3999          175.1215 Police and Firefighters' Premium Tax Trust
4000    Fund.--The Police and Firefighters' Premium Tax Trust Fund is
4001    created, to be administered by the Division of Retirement of the
4002    Department of Management Services. Funds credited to the trust
4003    fund, as provided in chapter 95-250, Laws of Florida, or similar
4004    legislation, shall be expended for the purposes set forth in
4005    that legislation.
4006          Section 66. Subsection (7) of section 185.02, Florida
4007    Statutes, is amended to read:
4008          185.02 Definitions.--For any municipality, chapter plan,
4009    local law municipality, or local law plan under this chapter,
4010    the following words and phrases as used in this chapter shall
4011    have the following meanings, unless a different meaning is
4012    plainly required by the context:
4013          (7) "Division" means the Division of Retirement of the
4014    State Board of AdministrationDepartment of Management Services.
4015          Section 67. Section 185.105, Florida Statutes, is amended
4016    to read:
4017          185.105 Police and Firefighters' Premium Tax Trust
4018    Fund.--The Police and Firefighters' Premium Tax Trust Fund is
4019    created, to be administered by the Division of Retirement of the
4020    Department of Management Services. Funds credited to the trust
4021    fund, as provided in chapter 95-250, Laws of Florida, or similar
4022    legislation, shall be expended for the purposes set forth in
4023    that legislation.
4024          Section 68. Paragraph (q) of subsection (4) of section
4025    215.20, Florida Statutes, is amended to read:
4026          215.20 Certain income and certain trust funds to
4027    contribute to the General Revenue Fund.--
4028          (4) The income of a revenue nature deposited in the
4029    following described trust funds, by whatever name designated, is
4030    that from which the appropriations authorized by subsection (3)
4031    shall be made:
4032          Compensation Trust Fund.
4033          (q) Within the Division of Retirement of the State Board
4034    of AdministrationDepartment of Management Services:
4035          1. The Administrative Trust Fund.
4036          2. The Architects Incidental Trust Fund.
4037          3. The Bureau of Aircraft Trust Fund.
4038          4. The Florida Facilities Pool Working Capital Trust Fund.
4039          5. The Grants and Donations Trust Fund.
4040          6. The Motor Vehicle Operating Trust Fund.
4041          7. The Police and Firefighters' Premium Tax Trust Fund.
4042          8. The Public Employees Relations Commission Trust Fund.
4043          9. The State Personnel System Trust Fund.
4044          10. The Supervision Trust Fund.
4045          11. The Working Capital Trust Fund.
4046         
4047          The enumeration of the foregoing moneys or trust funds shall not
4048    prohibit the applicability thereto of s. 215.24 should the
4049    Governor determine that for the reasons mentioned in s. 215.24
4050    the money or trust funds should be exempt herefrom, as it is the
4051    purpose of this law to exempt income from its force and effect
4052    when, by the operation of this law, federal matching funds or
4053    contributions or private grants to any trust fund would be lost
4054    to the state.
4055          Section 69. Subsection (3) of section 215.28, Florida
4056    Statutes, is amended to read:
4057          215.28 United States securities, purchase by state and
4058    county officers and employees; deductions from salary.--
4059          (3) All deductions so made by any such disbursing
4060    authority shall be deposited in a trust account separate and
4061    apart from the funds of the state, county, or subordinate
4062    agency. Such account will be subject to withdrawal only for the
4063    purchase of United States securities on behalf of officers and
4064    employees, or for refunds to such persons in accordance with the
4065    provisions of this law. Whenever the sum of $18.75 or the
4066    purchase price of the security requested to be purchased is
4067    accumulated from deductions so made from the salaries or wages
4068    of an officer or employee, such disbursing agent shall arrange
4069    the purchase of the bond or security applied for and have it
4070    registered in the name or names requested in the deduction
4071    authorization. Securities so purchased will be delivered in such
4072    manner as may be convenient for the issuing agent and the
4073    purchaser. Any interest earned on moneys in such account while
4074    awaiting the accumulation of the purchase price of the security
4075    shall be transferred to the Florida Retirement System Trust Fund
4076    as reimbursement for administrative costs incurred by the
4077    Division of Retirement of the State Board of Administration
4078    Department of Management Servicesunder this section.
4079          Section 70. Subsection (3) of section 215.50, Florida
4080    Statutes, is amended to read:
4081          215.50 Custody of securities purchased; income.--
4082          (3) The Treasurer, as custodian of securities owned by the
4083    Florida Retirement System Trust Fund and the Florida Survivor
4084    Benefit Trust Fund, shall collect the interest, dividends,
4085    prepayments, maturities, proceeds from sales, and other income
4086    accruing from such assets. As such income is collected by the
4087    Treasurer, it shall be deposited directly into a commercial bank
4088    to the credit of the State Board of Administration. Such bank
4089    accounts as may be required for this purpose shall offer
4090    satisfactory collateral security as provided by chapter 280. In
4091    the event funds so deposited according to the provisions of this
4092    section are required for the purpose of paying benefits or other
4093    operational needs, the State Board of Administration shall remit
4094    to the Florida Retirement System Trust Fund in the State
4095    Treasury such amounts as may be requested by the director of the
4096    Division of Retirement of the State Board of Administration
4097    Department of Management Services.
4098          Section 71. Subsections (2), (3), (11), and (13) of
4099    section 238.01, Florida Statutes, are amended to read:
4100          238.01 Definitions.--The following words and phrases as
4101    used in this chapter shall have the following meanings unless a
4102    different meaning is plainly required by the context:
4103          (2) "DivisionDepartment" means the Division of Retirement
4104    of the State Board of AdministrationDepartment of Management
4105    Services.
4106          (3) "Teacher" means any member of the teaching or
4107    professional staff and any certificated employee of any public
4108    free school, of any district school system and vocational
4109    school, any member of the teaching or professional staff of the
4110    Florida School for the Deaf and Blind, child training schools of
4111    the Department of Juvenile Justice, the Department of
4112    Corrections, and any tax-supported institution of higher
4113    learning of the state, and any member and any certified employee
4114    of the Department of Education, any certified employee of the
4115    retirement system, any full-time employee of any nonprofit
4116    professional association or corporation of teachers functioning
4117    in Florida on a statewide basis, which seeks to protect and
4118    improve public school opportunities for children and advance the
4119    professional and welfare status of its members, any person now
4120    serving as superintendent, or who was serving as county
4121    superintendent of public instruction on July 1, 1939, and any
4122    hereafter duly elected or appointed superintendent, who holds a
4123    valid Florida teachers' certificate. In all cases of doubt the
4124    divisionDepartment of Management Servicesshall determine
4125    whether any person is a teacher as defined herein.
4126          (11) "Regular interest" means interest at such rate as may
4127    be set from time to time by the divisionDepartment of
4128    Management Services.
4129          (13) "Earnable compensation" means the full compensation
4130    payable to a teacher working the full working time for his or
4131    her position. In respect to plans A, B, C, and D only, in cases
4132    where compensation includes maintenance, the divisionDepartment
4133    of Management Servicesshall fix the value of that part of the
4134    compensation not paid in money; provided that all members shall
4135    from July 1, 1955, make contributions to the retirement system
4136    on the basis of "earnable compensation" as defined herein and
4137    all persons who are members on July 1, 1955, may, upon
4138    application, have their "earnable compensation" for the time
4139    during which they have been members prior to that date
4140    determined on the basis of "earnable compensation" as defined in
4141    this law, upon paying to the retirement system, on or before the
4142    date of retirement, a sum equal to the additional contribution
4143    with accumulated regular interest thereon they would have made
4144    if "earnable compensation" had been defined, at the time they
4145    became members, as it is now defined. However, earnable
4146    compensation for all plan years beginning on or after July 1,
4147    1990, shall not include any amounts in excess of the
4148    compensation limitation (originally $200,000) established by s.
4149    401(a)(17) of the Internal Revenue Code prior to the Omnibus
4150    Budget Reconciliation Act of 1993, which limitation shall be
4151    adjusted for changes in the cost of living since 1989, in the
4152    manner provided by s. 401(a)(17) of the Internal Revenue Code of
4153    1991. This limitation, which has been part of the Teachers'
4154    Retirement System since plan years beginning on or after July 1,
4155    1990, shall be adjusted as required by federal law for qualified
4156    government plans.
4157          Section 72. Section 238.02, Florida Statutes, is amended
4158    to read:
4159          238.02 Name and date of establishment.--A retirement
4160    system is established and placed under the management of the
4161    divisionDepartment of Management Servicesfor the purpose of
4162    providing retirement allowances and other benefits for teachers
4163    of the state. The retirement system shall begin operations on
4164    July 1, 1939. It has such powers and privileges of a corporation
4165    as may be necessary to carry out effectively the provisions of
4166    this chapter and shall be known as the "Teachers' Retirement
4167    System of the State," and by such name all of its business shall
4168    be transacted, all of its funds invested, and all of its cash
4169    and securities and other property held in trust for the purpose
4170    for which received.
4171          Section 73. Section 238.03, Florida Statutes, is amended
4172    to read:
4173          238.03 Administration.--
4174          (1) The general administration and the responsibility for
4175    the proper operation of the retirement system and for making
4176    effective the provisions of this chapter are vested in the
4177    divisionDepartment of Management Services. Subject to the
4178    limitation of this chapter, the department shall, from time to
4179    time, establish rules and regulations for the administration and
4180    transaction of the business of the retirement system and shall
4181    perform such other functions as are required for the execution
4182    of this chapter.
4183          (2) The divisiondepartmentshall keep in convenient form
4184    such data as shall be necessary for actuarial valuation of the
4185    various funds created by this chapter and for checking the
4186    experience of the retirement system.
4187          (3) The Department of Legal Affairs shall be the legal
4188    adviser of the divisiondepartment.
4189          (4) The divisiondepartmentshall employ such agents,
4190    servants and employees as in its judgment may be necessary to
4191    carry out the terms and provisions of this chapter and shall
4192    provide for their compensation. Among the employees of the
4193    divisiondepartmentshall be an actuary who shall be the
4194    technical adviser of the divisiondepartmenton matters
4195    regarding the operation of the funds created by the provisions
4196    of this chapter and who shall perform such other duties as are
4197    required in connection therewith.
4198          (5) In the year 1943 and at least once in each 5-year
4199    period thereafter, the actuary shall make an actuarial
4200    investigation of the mortality, service and salary experience of
4201    the members and beneficiaries as defined in this chapter, and
4202    shall make a valuation of the various funds created by the
4203    chapter, and having regard to such investigation and valuation,
4204    the divisiondepartmentshall adopt such mortality and service
4205    tables as areshall bedeemed necessary, and shall certify the
4206    rates of contribution payable under the provisions of this
4207    chapter.
4208          (6) The actuary shall make an annual valuation of the
4209    assets and liabilities of the funds of the retirement system on
4210    the basis of the tables adopted by the divisiondepartmentin
4211    accordance with the requirements of this section, and shall
4212    prepare an annual statement of the amounts to be contributed by
4213    the state in accordance with s. 238.09.
4214          (7) The divisiondepartmentshall publish annually the
4215    valuation, as certified by the actuary, of the assets and
4216    liabilities of the various funds created by this chapter, a
4217    statement as to the receipts and disbursements of the funds, and
4218    a statement as to the accumulated cash and securities of the
4219    funds.
4220          (8) The divisiondepartmentshall keep a record of all of
4221    its proceedings and such record shall be open to inspection by
4222    the public.
4223          (9) The divisiondepartmentis authorized to photograph
4224    and reduce to microfilm as a permanent record, its ledger sheets
4225    showing the salary and contributions of members of the
4226    retirement system, also the records of deceased members of the
4227    system and thereupon to destroy the documents from which such
4228    films are photographed.
4229          Section 74. Paragraph (b) of subsection (1), paragraphs
4230    (a) and (b) of subsection (3), and subsection (4) of section
4231    238.05, Florida Statutes, are amended to read:
4232          238.05 Membership.--
4233          (1) The membership of the retirement system shall consist
4234    of the following:
4235          (b) All persons who became or who become teachers on or
4236    after July 1, 1939, except as provided in paragraph (a) and
4237    subsection (5) hereof, shall become members of the retirement
4238    system by virtue of their appointment as teachers. However,
4239    employees who are not members of the teaching or professional
4240    staff shall only become members of the retirement system by
4241    filing a notice with the divisiondepartmentof their election
4242    to become members.
4243          (3) Except as otherwise provided in s. 238.07(9),
4244    membership of any person in the retirement system will cease if
4245    he or she is continuously unemployed as a teacher for a period
4246    of more than 5 consecutive years, or upon the withdrawal by the
4247    member of his or her accumulated contributions as provided in s.
4248    238.07(13), or upon retirement, or upon death; provided that the
4249    adjustments prescribed below are to be made for persons who
4250    enter the Armed Forces of the United States during a period of
4251    war or national emergency and for persons who are granted leaves
4252    of absence. Any member of the retirement system who within 1
4253    year before the time of entering the Armed Forces of the United
4254    States was a teacher, as defined in s. 238.01, or was engaged in
4255    other public educational work within the state, and member of
4256    the Teachers' Retirement System at the time of induction, or who
4257    has been or is granted leave of absence, shall be permitted to
4258    elect to continue his or her membership in the Teachers'
4259    Retirement System; and membership service shall be allowed for
4260    the period covered by service in the Armed Forces of the United
4261    States or by leave of absence under the following conditions:
4262          (a) A person who has been granted leave of absence shall
4263    file with the divisiondepartmentbefore his or her next
4264    contribution is due an application to continue his or her
4265    membership during the period covered by the person's leave of
4266    absence and, if such application is filed, shall make his or her
4267    contribution to the retirement system on the basis of his or her
4268    last previous annual salary as a teacher, and shall, prior to
4269    retirement, pay in full to the system such contributions with
4270    accumulated regular interest. Such contributions with interest
4271    may be paid at one time or in monthly, quarterly, semiannual, or
4272    annual payments in the person's discretion.
4273          (b) A person who enters or who has entered the Armed
4274    Forces of the United States may either continue his or her
4275    membership according to the plan outlined under paragraph (a)
4276    or, in lieu thereof, may file with the divisiondepartmentat
4277    any time following the close of his or her military service an
4278    application that his or her membership be continued and that
4279    membership service be allowed for not more than 5 years of his
4280    or her period of service in the Armed Forces of the United
4281    States during any period of war or national emergency; provided
4282    that any such person shall, prior to retirement, pay in full his
4283    or her contributions with accumulated regular interest to the
4284    retirement system for the period for which he or she is entitled
4285    to membership service on the basis of his or her last previous
4286    annual salary as a teacher. Such contributions with interest may
4287    be paid to the department at one time or in monthly, quarterly,
4288    semiannual, or annual payments in the person's discretion.
4289          (4) The divisiondepartmentmay in its discretion deny the
4290    right to become members to any class of teachers who are serving
4291    on a temporary or any other than a per annum basis, and it may
4292    also in its discretion make optional with members in any such
4293    class their individual entrance into membership.
4294          Section 75. Subsections (3) and (10), paragraphs (a) and
4295    (b) of subsection (12), paragraphs (15A), (a), (b), and (d) of
4296    subsection (13), and paragraphs (a) and (d) of subsection (16)
4297    of section 238.07, Florida Statutes, are amended to read:
4298          238.07 Regular benefits; survivor benefits.--
4299          (3) Any member who, prior to July 1, 1955, elected to
4300    retire under one of plans A, B, C, or D may elect, prior to
4301    retirement, to retire under plan E in accordance with the terms
4302    hereof. Any person who became a member on or after July 1, 1955,
4303    shall retire under plan E, except as provided for under s.
4304    238.31. With respect to plans A, B, C, or D, any member shall
4305    have the right at any time to change to a plan of retirement
4306    requiring a lower rate of contribution. The divisionDepartment
4307    of Management Servicesshall also notify the member of the rate
4308    of contribution such member must make from and after selecting
4309    such plan of retirement. Any member in service may retire upon
4310    reaching the age of retirement formerly selected by him or her,
4311    upon the member's written application to the divisiondepartment
4312    setting forth at which time, not more than 90 days subsequent to
4313    the execution and filing of such application, it is his or her
4314    desire to retire notwithstanding that during such period of
4315    notification he or she may have separated from service. Upon
4316    receipt of such application for retirement, the division
4317    departmentshall retire such member not more than 90 days
4318    thereafter. Before such member may retire he or she must file
4319    with the divisiondepartmenthis or her written selection of one
4320    of the optional benefits provided in s. 238.08.
4321          (10) Any member in service, who has 10 or more years of
4322    creditable service, may upon the application of his or her
4323    employer or upon his or her own application, be retired by the
4324    divisiondepartmentnot less than 30 nor more than 90 days next
4325    following the date of filing such application, on a disability
4326    retirement allowance; provided that a physician licensed by this
4327    state examines and certifies that such member is mentally or
4328    physically incapacitated for the further performance of duty,
4329    that such incapacity is likely to be permanent, and that such
4330    member should be retired, and the divisiondepartmentconcurs.
4331    In making the determination, the divisiondepartmentmay require
4332    other evidence of disability as deemed appropriate.
4333          (12)(a) Once each year during the first 5 years following
4334    the retirement of a member on a disability retirement allowance,
4335    and once in every 3-year period thereafter, the division
4336    departmentmay require any disability beneficiary who has not
4337    yet attained his or her minimum service retirement age to
4338    undergo a medical examination by a physician licensed by this
4339    state and to submit any other evidence of disability as required
4340    by the divisiondepartment. IfShoulda disability beneficiary
4341    who has not yet attained his or her minimum service retirement
4342    age refusesrefuseto submit to any such medical examination,
4343    his or her retirement allowance shall be discontinued until his
4344    or her withdrawal of such refusal, and ifshould such refusal
4345    continuescontinuefor 1 year, all of the disability
4346    beneficiary's rights in and to his or her pension shall be
4347    forfeited.
4348          (b) If the divisiondepartmentfinds that a disability
4349    beneficiary is engaged in or is able to engage in a gainful
4350    occupation paying more than the difference between his or her
4351    disability retirement allowance and his or her average final
4352    compensation, the amount of the beneficiary's pension shall be
4353    reduced to an amount which, together with his or her annuity and
4354    the amount earnable by him or her, shall equal the amount of his
4355    or her average final compensation. Should the beneficiary's
4356    earning capacity later be changed, the amount of his or her
4357    pension may be further modified; provided that the pension so
4358    modified shall not exceed the amount of the pension allowable
4359    under subsection (11), at the time of retirement, nor an amount
4360    which, when added to the amount earnable by the beneficiary,
4361    together with his or her annuity, equals the amount of his or
4362    her average final compensation. A beneficiary restored to active
4363    service at a salary less than the average final compensation
4364    upon the basis of which he or she was retired shall not become a
4365    member of the retirement system at that time.
4366          (13) IfShould a member ceasesceaseto be a teacher
4367    except by death or by retirement under the provisions of this
4368    chapter, the member shall be paid the amount of his or her
4369    accumulated contributions. IfShould a member diesdiebefore
4370    retirement, the amount of his or her accumulated contributions
4371    shall be paid to such person, if any, as he or she shall have
4372    nominated by written designation duly executed and filed with
4373    the divisiondepartment; otherwise, to his or her executors or
4374    administrators.
4375          (15A)(a) Any member of the Teachers' Retirement System who
4376    has heretofore, or who hereafter, retires with no less than 10
4377    years of creditable service and who has passed his or her 65th
4378    birthday, may, upon application to the divisiondepartment, have
4379    his or her retirement allowance redetermined and thereupon shall
4380    be entitled to a monthly service retirement allowance which
4381    shall be equal to $4 multiplied by the number of years of the
4382    member's creditable service which shall be payable monthly
4383    during his or her retirement; provided, that the amount of
4384    retirement allowance as determined hereunder, shall be reduced
4385    by an amount equal to:
4386          1. Any social security benefits received by the member,
4387    and
4388          2. Any social security benefits that the member is
4389    eligible to receive by reason of his or her own right or through
4390    his or her spouse.
4391          (b) No payment shall be made to a member of the Teachers'
4392    Retirement System under this act, until the divisiondepartment
4393    has determined the social security status of such member.
4394          (d) The divisiondepartmentshall review, at least
4395    annually, the social security status of all members of the
4396    Teachers' Retirement System receiving payment under this act and
4397    shall increase or decrease payments to such members as shall be
4398    necessary to carry out the intent of this act.
4399          (16)(a) Definitions under survivor benefits are:
4400          1. A dependent is a child, widow, widower, or parent of
4401    the deceased member who was receiving not less than one-half of
4402    his or her support from the deceased member at the time of the
4403    death of such member.
4404          2. A child is a natural or legally adopted child of a
4405    member, who:
4406          a. Is under 18 years of age, or
4407          b. Is over 18 years of age but not over 22 years of age
4408    and is enrolled as a student in an accredited educational
4409    institution, or
4410          c. Is 18 years of age or older and is physically or
4411    mentally incapable of self-support, when such mental and
4412    physical incapacity occurred prior to such child obtaining the
4413    age of 18 years. Such person shall cease to be regarded as a
4414    child upon the termination of such physical or mental
4415    disability. The determination as to such physical or mental
4416    incapability shall be vested in the divisiondepartment.
4417         
4418          No person shall be considered a child who has married or, except
4419    as provided in sub-subparagraph 2.b. or as to a child who is
4420    physically or mentally incapable of self-support as hereinbefore
4421    set forth, has become 18 years of age.
4422          3. A parent is a natural parent of a member and includes a
4423    lawful spouse of a natural parent.
4424          4. A beneficiary is a person who is entitled to benefits
4425    under this subsection by reason of his or her relation to a
4426    deceased member during the lifetime of such member.
4427          (d) Limitations on rights of beneficiary are:
4428          1. The person named as beneficiary in paragraph (b) shall,
4429    in no event, be entitled to receive the benefits set out in such
4430    paragraph unless the death of the member under whom such
4431    beneficiary claims occurs within the period of time after the
4432    member has served in Florida as follows:
4433         
4434         
Minimum number of yearsof service in FloridaPeriod after serving in Florida in which deathof member occurs
4435          2. Upon the death of a member, the divisiondepartment
4436    shall make a determination of the beneficiary or beneficiaries
4437    of the deceased member and shall pay survivor benefits to such
4438    beneficiary or beneficiaries beginning 1 month immediately
4439    following the death of the member except where the beneficiary
4440    has not reached the age required to receive benefits under
4441    paragraph (b), in which event the payment of survivor benefits
4442    shall begin as of the month immediately following the month in
4443    which the beneficiary reaches the required age. When required by
4444    the divisiondepartment, the beneficiary or beneficiaries shall
4445    file an application for survivor benefits upon forms prescribed
4446    by the divisiondepartment.
4447          3. The beneficiaries of a member to receive survivor
4448    benefits are fixed by this subsection, and a member may not buy
4449    or otherwise change such benefits. He or she may, however,
4450    designate the beneficiary to receive the $500 death benefits. If
4451    a member fails to make this designation, the $500 death benefits
4452    shall be paid to his or her executor or administrator.
4453          4. The beneficiary or beneficiaries of a member whose
4454    death occurs while he or she is in service or while he or she is
4455    receiving a disability allowance under subsection (11), shall
4456    receive survivor benefits under this subsection determined by
4457    the years of service in Florida of the deceased member as set
4458    out in paragraph (b). The requirement that the death of a member
4459    must occur within a certain period of time after service in
4460    Florida as set out in subparagraph (d)1. shall not apply to a
4461    member receiving a disability benefit at the time of his or her
4462    death.
4463          Section 76. Subsection (2), paragraph (b) of subsection
4464    (5), and subsections (6) and (7) of section 238.08, Florida
4465    Statutes, are amended to read:
4466          238.08 Optional benefits.--A member may elect to receive
4467    his or her benefits under the terms of this chapter according to
4468    the provisions of any one of the following options:
4469          (2) Option two. A member may elect to receive on
4470    retirement the actuarial equivalent (at that time) of his or her
4471    retirement allowance in a reduced retirement allowance payable
4472    throughout life, with the provisions that if the member dies
4473    before he or she has received in payment of his or her annuity
4474    the amount of his or her accumulated contributions, as they were
4475    at the time of his or her retirement, the balance shall be paid
4476    to such person, if any, as he or she shall nominate by written
4477    designation duly acknowledged and filed with the division
4478    department; otherwise, to his or her executors or
4479    administrators.
4480          (5)
4481          (b) A member who elects Option three or Option four shall,
4482    on a form provided for that purpose, designate his or her spouse
4483    as beneficiary to receive the benefits which continue to be
4484    payable upon the death of the member. After such benefits have
4485    commenced under Option three or Option four, the retired member
4486    may change the designation of his or her spouse as beneficiary
4487    only twice. If such a retired member remarries and wishes to
4488    make such a change, he or she may do so by filing with the
4489    divisiondepartmenta notarized change of spouse designation
4490    form and shall notify the former spouse in writing of such
4491    change. Upon receipt of a completed change of spouse designation
4492    form, the divisiondepartmentshall adjust the member's monthly
4493    benefit by the application of actuarial tables and calculations
4494    developed to ensure that the benefit paid is the actuarial
4495    equivalent of the present value of the member's current benefit.
4496    The consent of a retired member's formerly designated spouse as
4497    beneficiary to any such change shall not be required.
4498          (6) Notwithstanding any provision in this chapter to the
4499    contrary, the following provisions shall apply to any member of
4500    the retirement system who has accumulated at least 10 years of
4501    service and dies prior to retirement:
4502          (a) If the deceased member's surviving spouse has
4503    previously received a refund of the member's accumulated
4504    contributions made to the retirement system, such spouse may pay
4505    to the divisiondepartmentan amount equal to the sum of the
4506    amount of the deceased member's contributions previously
4507    refunded and regular interest compounded annually on the amount
4508    of such refunded contributions from the date of refund to the
4509    date of payment to the divisiondepartment, and by so doing be
4510    entitled to receive the monthly retirement benefit provided in
4511    paragraph (c).
4512          (b) If the deceased member's surviving spouse has not
4513    received a refund of the deceased member's accumulated
4514    contributions, such spouse shall, upon application to the
4515    divisiondepartmentwithin 30 days of the death of the member,
4516    receive the monthly retirement benefit provided in paragraph
4517    (c).
4518          (c) The monthly benefit payable to the spouse described in
4519    paragraph (a) or paragraph (b) shall be the amount which would
4520    have been payable to the deceased member's spouse, assuming that
4521    the member retired on the date of his or her death and had
4522    selected the option in subsection (3), such benefit to be based
4523    on the ages of the spouse and member as of the date of death of
4524    the member. The benefit shall commence on the first day of the
4525    month following the payment of the aforesaid amount to the
4526    divisiondepartment, if paragraph (a) is applicable, or on the
4527    first day of the month following the receipt of the spouse's
4528    application by the divisiondepartment, if paragraph (b) is
4529    applicable.
4530          (7) The surviving spouse or other dependent of any member
4531    whose employment is terminated by death shall, upon application
4532    to the divisiondepartment, be permitted to pay the required
4533    contributions for any service performed by the member which
4534    could have been claimed by the member at the time of his or her
4535    death. Such service shall be added to the creditable service of
4536    the member and shall be used in the calculation of any benefits
4537    which may be payable to the surviving spouse or other surviving
4538    dependent.
4539          Section 77. Paragraphs (a), (c), and (d) of subsection
4540    (1), paragraphs (b), (c), and (e) of subsection (3), and
4541    paragraph (b) of subsection (5) of section 238.09, Florida
4542    Statutes, are amended to read:
4543          238.09 Method of financing.--All of the assets of the
4544    retirement system shall be credited, according to the purposes
4545    for which they are held, to one of four funds; namely, the
4546    Annuity Savings Trust Fund, the Pension Accumulation Trust Fund,
4547    the Expense Trust Fund, and the Survivors' Benefit Trust Fund.
4548          (1) The Annuity Savings Trust Fund shall be a fund in
4549    which shall be accumulated contributions made from the salaries
4550    of members under the provisions of paragraph (c) or paragraph
4551    (f). Contribution to, payments from, the Annuity Savings Trust
4552    Fund shall be made as follows:
4553          (a) With respect to plan A, B, C, or D, upon the basis of
4554    such tables as the division adoptsDepartment of Management
4555    Services shall adopt, and regular interest, the actuary of the
4556    retirement system shall determine for each member the proportion
4557    of earnable compensation which, when deducted from each payment
4558    of his or her prospective earnable annual compensation prior to
4559    his or her minimum service retirement age, and accumulated at
4560    regular interest until such age, shall be computed to provide at
4561    such age:
4562          1. An annuity equal to one one-hundred-fortieth of his or
4563    her average final compensation multiplied by the number of his
4564    or her years of membership in the case of each member electing
4565    to retire under the provisions of plan A or B.
4566          2. An annuity equal to one one-hundred-twentieth of his or
4567    her average final compensation multiplied by the number of his
4568    or her years of membership service in the case of each member
4569    electing to retire under the provisions of plan C.
4570          3. An annuity equal to one one-hundredth of his or her
4571    average final compensation multiplied by the number of his or
4572    her years of membership service in the case of each member
4573    electing to retire under the provisions of plan D.
4574         
4575          In the case of any member who has attained his or her minimum
4576    service retirement age prior to becoming a member, the
4577    proportion of salary applicable to such member, with respect to
4578    plan A, B, C, or D, shall be the proportion computed for the age
4579    1 year younger than his or her minimum service retirement age.
4580          (c) The divisiondepartmentshall certify to each employer
4581    the proportion of the earnable compensation of each member who
4582    is compensated by the employer, and the employer shall cause to
4583    be deducted from the salary of each member on each and every
4584    payroll for each and every payroll period an amount equal to the
4585    proportion of the member's earnable compensation so computed.
4586    With respect to plan A, B, C, or D, the employer shall not make
4587    any deduction for annuity purposes from the compensation of a
4588    member who has attained the age of 60 years, if such member
4589    elects not to contribute.
4590          (d) In determining the amount earnable by a member in a
4591    payroll period, the divisiondepartmentmay consider the rate of
4592    compensation payable to such member on the first day of the
4593    payroll period as continuing throughout such payroll period, and
4594    it may omit deductions from compensation for any period less
4595    than a full payroll period if a teacher was not a member on the
4596    first day of the payroll period, and to facilitate the making of
4597    deductions, it may modify any deduction required of any member
4598    by such an amount as shall not exceed one-tenth of 1 percent of
4599    the annual salary from which said deduction is to be made.
4600          (3) The Pension Accumulation Trust Fund shall be the fund
4601    in which shall be accumulated all reserves for the payment of
4602    all annuities or benefits in lieu of annuities on retired
4603    members and all pensions and other benefits payable from
4604    contributions made by the members and by the employers, from
4605    which annuities, pensions and benefits in lieu thereof shall be
4606    paid. Contributions to, and payments from, the Pension
4607    Accumulation Trust Fund, other than as set forth in subsections
4608    (2) and (3) herein, shall be made as follows:
4609          (b) On the basis of regular interest and of such mortality
4610    and other tables as areshall be adopted by the division
4611    department, the actuary engaged by the divisiondepartmentto
4612    make each valuation required by this chapter shall, during the
4613    period over which the accrued liability contribution is payable,
4614    determine, immediately after making such valuation, the uniform
4615    and constant percentage of the earnable compensation of the
4616    average new entrant, which, if contributed on the basis of his
4617    or her compensation throughout his or her entire period of
4618    service, would be sufficient to provide for the payment of any
4619    pension payable by the state on his or her account. The rate
4620    percent so determined shall be known as the normal contribution
4621    rate. After the accrued liability contribution has ceased to be
4622    payable, the normal contribution rate shall be the rate percent
4623    of the earnable compensation of all members, obtained by
4624    deducting from the total liabilities of the Pension Accumulation
4625    Trust Fund the amount of the funds in hand to the credit of that
4626    fund and dividing the remainder by 1 percent of the present
4627    value of the prospective future salaries of all members as
4628    computed on the basis of the mortality and service tables
4629    adopted by the divisiondepartmentand on the basis of regular
4630    interest. The normal rate of contribution shall be determined
4631    and certified to the divisiondepartmentby the actuary after
4632    each valuation and shall continue in force until a new valuation
4633    and certification are made.
4634          (c) Immediately succeeding the first valuation, the
4635    actuary engaged by the divisiondepartmentshall compute the
4636    rate percent of the total earnable compensation of all members
4637    which is equivalent to 4 percent of the amount of the total
4638    liability for pensions on account of all members and
4639    beneficiaries and not dischargeable by the present assets of the
4640    Pension Accumulation Trust Fund and by the aforesaid normal
4641    contribution if made on account of such members during the
4642    remainder of their active service. The rate percent, originally
4643    so determined, shall be known as the accrued liability
4644    contribution rate.
4645          (e) The accrued liability contribution shall be
4646    discontinued as soon as the accumulated reserve in the Pension
4647    Accumulation Trust Fund shall equal the present value, as
4648    actuarially computed and approved by the divisiondepartment, of
4649    the total liability of such fund less the present value,
4650    computed on the basis of the normal contribution rate, then in
4651    force of the prospective normal contributions to be received on
4652    account of persons who are at that time members.
4653          (5)
4654          (b) The divisiondepartmentshall annually certify to each
4655    employer, at the time it makes the certification to the employer
4656    under paragraph (1)(c), the rate of twenty-five-hundredths
4657    percent to be applied by the employer to the salary of each
4658    member who is compensated by the employer, and the employer
4659    shall cause to be deducted from the salary of each member on
4660    each and every payroll for each and every payroll period an
4661    amount equal to twenty-five-hundredths percent of the member's
4662    salary paid by the employer and the employer shall remit monthly
4663    such deducted amounts to the divisiondepartmentwhich shall
4664    place the same in the Survivors' Benefit Trust Fund of the
4665    Teachers' Retirement System of the state. The amount of
4666    contributions by a member to the Survivors' Benefit Trust Fund
4667    shall, in no event, be refundable to the member or his or her
4668    beneficiaries.
4669          Section 78. Section 238.10, Florida Statutes, is amended
4670    to read:
4671          238.10 Management of funds.--The divisionDepartment of
4672    Management Services, annually, shall allow regular interest on
4673    the amount for the preceding year to the credit of each of the
4674    funds of the retirement system, and to the credit of the
4675    individual account therein, if any, with the exception of the
4676    expense fund, from the interest and dividends earned from
4677    investments.
4678          Section 79. Paragraph (b) of subsection (1), and
4679    subsections (2) and (3) of section 238.11, Florida Statutes, are
4680    amended to read:
4681          238.11 Collection of contributions.--
4682          (1) The collection of contributions shall be as follows:
4683          (b) Each employer shall transmit monthly to the division
4684    Department of Management Servicesa warrant for the total amount
4685    of such deductions. Each employer shall also transmit monthly to
4686    the divisiondepartmenta warrant for such employer contribution
4687    set aside as provided for in paragraph (a) of this subsection.
4688    The divisiondepartment, after making records of all such
4689    warrants, shall transmit them to the Department of Banking and
4690    Finance for delivery to the Treasurer of the state who shall
4691    collect them.
4692          (2) The collection of the state contribution shall be made
4693    as follows:
4694          (a) The amounts required to be paid by the state into the
4695    Teachers' Retirement System in this chapter shall be provided
4696    therefor in the General Appropriations Act. However, in the
4697    event a sufficient amount is not included in the General
4698    Appropriations Act to meet the full amount needed to pay the
4699    retirement compensation provided for in this chapter, the
4700    additional amount needed for such retirement compensation is
4701    hereby appropriated from the General Revenue Fund as approved by
4702    the divisionDepartment of Management Services.
4703          (b) The divisionDepartment of Management Servicesshall
4704    certify one-fourth of the amount so ascertained for each year to
4705    the Comptroller on or before the last day of July, October,
4706    January, and April of each year. The Comptroller shall, on or
4707    before the first day of August, November, February, and May of
4708    each year, draw his or her warrant or warrants on the Treasurer
4709    for the respective amounts due the several funds of the
4710    retirement system. On the receipt of the warrant or warrants of
4711    the Comptroller, the Treasurer shall immediately transfer to the
4712    several funds of the retirement system the amounts due.
4713          (3) All collection of contributions of a nonprofit
4714    professional association or corporation of teachers as referred
4715    to in s. 238.01(3) and (5) shall be made by such association or
4716    corporation in the following manner:
4717          (a) On April 1 of each year, the divisionDepartment of
4718    Management Servicesshall certify to any such nonprofit
4719    professional association or corporation of teachers the amounts
4720    which will become due and payable during the ensuing fiscal year
4721    to each of the funds of the retirement system to which such
4722    contributions are payable as set forth in this law.
4723          (b) The divisionDepartment of Management Servicesshall
4724    certify one-fourth of the amount so ascertained for each year to
4725    the nonprofit professional association or corporation of
4726    teachers on or before the last day of July, October, January,
4727    and April of each year. The nonprofit professional association
4728    or corporation of teachers shall, on or before the first day of
4729    August, November, February, and May of each year, draw its check
4730    payable to the divisiondepartmentfor the respective amounts
4731    due the several funds of the retirement system. Upon receipt of
4732    the check, the divisiondepartmentshall immediately transfer to
4733    the several funds of the retirement system the amounts due,
4734    provided, however, that the amounts due the several funds of the
4735    retirement system from any such association or corporation for
4736    creditable service accruing to any such member before July 1,
4737    1947, shall be paid prior to the retirement of any such member.
4738          Section 80. Section 238.12, Florida Statutes, is amended
4739    to read:
4740          238.12 Duties of employers.--
4741          (1) Each employer shall keep such records and, from time
4742    to time, shall furnish such information as the division requires
4743    Department of Management Services may requirein the discharge
4744    of its duties. Upon the employment of any teacher to whom this
4745    chapter may apply, the teacher shall be informed by his or her
4746    employer of his or her duties and obligations in connection with
4747    the retirement system as a condition of his or her employment.
4748    Every teacher accepting employment shall be deemed to consent
4749    and agree to any deductions from his or her compensation
4750    required in this chapter and to all other provisions of this
4751    chapter.
4752          (2) During September of each year, or at such other time
4753    as the division approvesdepartment shall approve, each employer
4754    shall certify to the divisiondepartmentthe names of all
4755    teachers to whom this chapter applies.
4756          (3) Each employer shall, on the first day of each calendar
4757    month, or at such less frequent intervals as the division
4758    approvesdepartment may approve, notify the divisiondepartment
4759    of the employment of new teachers, removals, withdrawals and
4760    changes in salary of members that have occurred during the
4761    preceding month, or the period covered since the last
4762    notification.
4763          Section 81. Section 238.14, Florida Statutes, is amended
4764    to read:
4765          238.14 Protection against fraud.--Any person who shall
4766    knowingly make any false statement, or shall falsify or permit
4767    to be falsified any record or records of this retirement system
4768    in any attempt to defraud such system as a result of such act,
4769    shall be guilty of a misdemeanor of the second degree,
4770    punishable as provided in s. 775.082 or s. 775.083. Should any
4771    change or error in records result in any member or beneficiary
4772    receiving from the retirement system more or less than he or she
4773    would have been entitled to receive had the records been
4774    correct, then on discovery of any such error the division
4775    departmentshall correct such error, and, as far as practicable,
4776    shall adjust the payments in such a manner that the actuarial
4777    equivalent of the benefit, to which such member or beneficiary
4778    was correctly entitled, shall be paid.
4779          Section 82. Section 238.15, Florida Statutes, is amended
4780    to read:
4781          238.15 Exemption of funds from taxation, execution, and
4782    assignment.--The pensions, annuities or any other benefits
4783    accrued or accruing to any person under the provisions of this
4784    chapter and the accumulated contributions and cash securities in
4785    the funds created under this chapter are exempted from any
4786    state, county or municipal tax of the state, and shall not be
4787    subject to execution or attachment or to any legal process
4788    whatsoever, and shall be unassignable, except:
4789          (1) That any teacher who has retired shall have the right
4790    and power to authorize in writing the divisionDepartment of
4791    Management Servicesto deduct from his or her monthly retirement
4792    allowance money for the payment of the premiums on group
4793    insurance for hospital, medical and surgical benefits, under a
4794    plan or plans for such benefits approved in writing by the
4795    Insurance Commissioner and Treasurer of the state, and upon
4796    receipt of such request the divisiondepartmentshall make the
4797    monthly payments as directed; and
4798          (2) As may be otherwise specifically provided for in this
4799    chapter.
4800          Section 83. Paragraph (b) of subsection (3) of section
4801    238.171, Florida Statutes, is amended to read:
4802          238.171 Monthly allowance; when made.--
4803          (3)
4804          (b) On July 1, 1975, and each July 1 thereafter, the
4805    divisionDepartment of Management Servicesshall adjust the
4806    monthly allowance being paid on thatsaiddate. The percentage
4807    of such adjustment shall be equal to the percentage change in
4808    the average cost-of-living index during the preceding 12-month
4809    period, April 1 through March 31, ignoring changes in the cost-
4810    of-living index which are greater than 3 percent during the
4811    preceding fiscal year.
4812          Section 84. Paragraphs (b), (c), (d), (e), and (f) of
4813    subsection (2) of section 238.181, Florida Statutes, are amended
4814    to read:
4815          238.181 Reemployment after retirement; conditions and
4816    limitations.--
4817          (2)
4818          (b) Any person to whom the limitation in paragraph (a)
4819    applies who violates such reemployment limitation and who is
4820    reemployed with any agency participating in the Florida
4821    Retirement System before completion of the 12-month limitation
4822    period shall give timely notice of this fact in writing to his
4823    or her employer and to the divisionDepartment of Management
4824    Servicesand shall have his or her retirement benefits suspended
4825    for the balance of the 12-month limitation period. Any person
4826    employed in violation of this paragraph and any employing agency
4827    which knowingly employs or appoints such person without
4828    notifying the divisiondepartmentto suspend retirement benefits
4829    shall be jointly and severally liable for reimbursement to the
4830    retirement trust fund of any benefits paid during the
4831    reemployment limitation period. To avoid liability, such
4832    employing agency shall have a written statement from the retiree
4833    that he or she is not retired from a state-administered
4834    retirement system. Any retirement benefits received while
4835    reemployed during this reemployment limitation period shall be
4836    repaid to the retirement trust fund, and retirement benefits
4837    shall remain suspended until such repayment has been made.
4838    Benefits suspended beyond the reemployment limitation shall
4839    apply toward repayment of benefits received in violation of the
4840    reemployment limitation.
4841          (c) A district school board may reemploy a retired member
4842    as a substitute or hourly teacher on a noncontractual basis
4843    after he or she has been retired for 1 calendar month, in
4844    accordance with s. 121.021(39). Any retired member who is
4845    reemployed within 1 calendar month after retirement shall void
4846    his or her application for retirement benefits. District school
4847    boards reemploying such teachers are subject to the retirement
4848    contribution required by paragraph (g). Reemployment of a
4849    retired member as a substitute or hourly teacher is limited to
4850    780 hours during the first 12 months of his or her retirement.
4851    Any retired member reemployed for more than 780 hours during his
4852    or her first 12 months of retirement shall give timely notice in
4853    writing to his or her employer and to the divisiondepartmentof
4854    the date he or she will exceed the limitation. The division
4855    departmentshall suspend his or her retirement benefits for the
4856    remainder of his or her first 12 months of retirement. Any
4857    person employed in violation of this paragraph and any employing
4858    agency which knowingly employs or appoints such person without
4859    notifying the divisiondepartmentto suspend retirement benefits
4860    shall be jointly and severally liable for reimbursement to the
4861    retirement trust fund of any benefits paid during the
4862    reemployment limitation period. To avoid liability, such
4863    employing agency shall have a written statement from the retiree
4864    that he or she is not retired from a state-administered
4865    retirement system. Any retirement benefits received by a retired
4866    member while reemployed in excess of 780 hours during his or her
4867    first 12 months of retirement shall be repaid to the Retirement
4868    System Trust Fund, and his or her retirement benefits shall
4869    remain suspended until repayment is made. Benefits suspended
4870    beyond the end of the retired member's first 12 months of
4871    retirement shall apply toward repayment of benefits received in
4872    violation of the 780-hour reemployment limitation.
4873          (d) A community college board of trustees may reemploy a
4874    retired member as an adjunct instructor, that is, an instructor
4875    who is noncontractual and part time, or as a participant in a
4876    phased retirement program within a community college, after he
4877    or she has been retired for 1 calendar month, in accordance with
4878    s. 121.021(39). Any retired member who is reemployed within 1
4879    calendar month after retirement shall void his or her
4880    application for retirement benefits. Boards of trustees
4881    reemploying such instructors are subject to the retirement
4882    contribution required in paragraph (g). A retired member may be
4883    reemployed as an adjunct instructor for no more than 780 hours
4884    during the first 12 months of his or her retirement. Any retired
4885    member reemployed for more than 780 hours during his or her
4886    first 12 months of retirement shall give timely notice in
4887    writing to his or her employer and to the divisiondepartmentof
4888    the date he or she will exceed the limitation. The division
4889    departmentshall suspend his or her retirement benefits for the
4890    remainder of his or her first 12 months of retirement. Any
4891    person employed in violation of this paragraph and any employing
4892    agency which knowingly employs or appoints such person without
4893    notifying the divisiondepartmentto suspend retirement benefits
4894    shall be jointly and severally liable for reimbursement to the
4895    retirement trust fund of any benefits paid during the
4896    reemployment limitation period. To avoid liability, such
4897    employing agency shall have a written statement from the retiree
4898    that he or she is not retired from a state-administered
4899    retirement system. Any retirement benefits received by a retired
4900    member while reemployed in excess of 780 hours during his or her
4901    first 12 months of retirement shall be repaid to the Retirement
4902    System Trust Fund, and retirement benefits shall remain
4903    suspended until repayment is made. Benefits suspended beyond the
4904    end of the retired member's first 12 months of retirement shall
4905    apply toward repayment of benefits received in violation of the
4906    780-hour reemployment limitation.
4907          (e) The Board of Trustees of the Florida School for the
4908    Deaf and the Blind may reemploy a retired member as a substitute
4909    teacher, substitute residential instructor, or substitute nurse
4910    on a noncontractual basis after he or she has been retired for 1
4911    calendar month, in accordance with s. 121.021(39). Any retired
4912    member who is reemployed within 1 calendar month after
4913    retirement shall void his or her application for retirement
4914    benefits. The Board of Trustees of the Florida School for the
4915    Deaf and the Blind reemploying such teachers, residential
4916    instructors, or nurses is subject to the retirement contribution
4917    required by paragraph (g). Reemployment of a retired member as a
4918    substitute teacher, substitute residential instructor, or
4919    substitute nurse is limited to 780 hours during the first 12
4920    months of his or her retirement. Any retired member reemployed
4921    for more than 780 hours during his or her first 12 months of
4922    retirement shall give timely notice in writing to his or her
4923    employer and to the divisiondepartmentof the date he or she
4924    will exceed the limitation. The divisiondepartmentshall
4925    suspend his or her retirement benefits for the remainder of his
4926    or her first 12 months of retirement. Any person employed in
4927    violation of this paragraph and any employing agency which
4928    knowingly employs or appoints such person without notifying the
4929    divisiondepartmentto suspend retirement benefits shall be
4930    jointly and severally liable for reimbursement to the retirement
4931    trust fund of any benefits paid during the reemployment
4932    limitation period. To avoid liability, such employing agency
4933    shall have a written statement from the retiree that he or she
4934    is not retired from a state-administered retirement system. Any
4935    retirement benefits received by a retired member while
4936    reemployed in excess of 780 hours during his or her first 12
4937    months of retirement shall be repaid to the Retirement System
4938    Trust Fund, and his or her retirement benefits shall remain
4939    suspended until payment is made. Benefits suspended beyond the
4940    end of the retired member's first 12 months of retirement shall
4941    apply toward repayment of benefits received in violation of the
4942    780-hour reemployment limitation.
4943          (f) The State University System may reemploy a retired
4944    member as an adjunct faculty member or as a participant in a
4945    phased retirement program within the State University System
4946    after the retired member has been retired for 1 calendar month,
4947    in accordance with s. 121.021(39). Any retired member who is
4948    reemployed within 1 calendar month after retirement shall void
4949    his or her application for retirement benefits. The State
4950    University System is subject to the retired contribution
4951    required in paragraph (g), as appropriate. A retired member may
4952    be reemployed as an adjunct faculty member or a participant in a
4953    phased retirement program for no more than 780 hours during the
4954    first 12 months of his or her retirement. Any retired member
4955    reemployed for more than 780 hours during his or her first 12
4956    months of retirement shall give timely notice in writing to his
4957    or her employer and to the divisiondepartmentof the date he or
4958    she will exceed the limitation. The divisiondepartmentshall
4959    suspend his or her retirement benefits for the remainder of his
4960    or her first 12 months of retirement. Any person employed in
4961    violation of this paragraph and any employing agency which
4962    knowingly employs or appoints such person without notifying the
4963    divisiondepartmentto suspend retirement benefits shall be
4964    jointly and severally liable for reimbursement to the retirement
4965    trust fund of any benefits paid during the reemployment
4966    limitation period. To avoid liability, such employing agency
4967    shall have a written statement from the retiree that he or she
4968    is not retired from a state-administered retirement system. Any
4969    retirement benefits received by a retired member while
4970    reemployed in excess of 780 hours during his or her first 12
4971    months of retirement shall be repaid to the Retirement System
4972    Trust Fund, and retirement benefits shall remain suspended until
4973    repayment is made. Benefits suspended beyond the end of the
4974    retired member's first 12 months of retirement shall apply
4975    toward repayment of benefits received in violation of the 780-
4976    hour reemployment limitation.
4977          Section 85. Section 238.32, Florida Statutes, is amended
4978    to read:
4979          238.32 Service credit in disputed cases.--The division
4980    Department of Management Servicesmay in its discretion allow or
4981    deny a member service credit in disputed or doubtful cases for
4982    employment in Florida and out-of-state schools in order to serve
4983    the best interests of the state and the member, subject to the
4984    membership dates set forth in s. 238.06(4).
4985          Section 86. Subsection (4) of section 650.02, Florida
4986    Statutes, is amended to read:
4987          650.02 Definitions.--For the purpose of this chapter:
4988          (4) The term "state agency" means the Division of
4989    Retirement of the State Board of AdministrationDepartment of
4990    Management Services.
4991          Section 87. This act shall take effect July 1, 2003.