HB 0605 2003
1	A bill to be entitled
2	An act relating to the City of Orlando, Orange County,
3	relating to the pension fund of the police department of
4	the city; amending chapter 22414, Laws of Florida (1943),
5	as amended; defining participants; providing an effective
6	date for all retirements; defining credited service to
7	include both full and fractional years of service;
8	providing for a change in the computation of monthly
9	pension for members with between 20 and 25 years of
10	credited service; providing for reinstatement into the
11	pension plan for members who retire and become reemployed
12	as sworn members; providing for a BACKDROP retirement
13	option plan as an improvement to present pension benefits;
14	providing that additional costs of certain benefits be
15	borne by members; providing an effective date.
16
17	Be It Enacted by the Legislature of the State of Florida:
18
19	Section 1. Section 4 of chapter 22414, Laws of Florida
20	(1943), as amended, is amended to read:
21	Section 4. Participant defined; effective date of
22	retirement establishedEmployees Included.--
23	(1)For the purposes of this retirement plan, all sworn
24	members of the Orlando Police Department who are employed and
25	certified as law enforcement officers pursuant to Florida
26	Statutes ch. 943 and. employed on a permanent, full-time basis
27	by the City in positions subject to withholding of federal
28	income and FICA taxes and regardless of duty assignment, are
29	mandatory participants in this retirement plan, and are
30	hereinafter referred to as "members” or "participants."which is
31	mandatory as to those so employed. Non-police officer civilian
32	employees of the Department are excluded from this retirement
33	plan, such employees being covered by the General Employees
34	Retirement Plan of the City of Orlando.
35	(2) Any retirement under this plan, whether for service or
36	disability, shall be effective the first day of the month
37	following the last day the member is in an active pay status
38	prior to retiring (or effective date of retirement for a
39	BACKDROP participant).
40	Section 2. Subsections (1) and (2) of section 6 of chapter
41	22414, Laws of Florida (1943), as amended, are amended to read:
42	Section 6. Service Requirements for Voluntary Retirement;
43	Benefits upon Death of Retired Member.
44	(1) For the purposes of this retirement plan, the
45	following definitions shall apply:
46	(a) "Credited service" means personal service rendered the
47	City of Orlando Police Department while a participant in this
48	plan, together with qualifying military service, which shall be
49	credited to each member's credited service account each plan
50	year in accordance with rules established by the Board of
51	Trustees. For purposes of benefit calculation, “year of
52	service” shall include both full and fractional years of
53	service, calculated on the appropriate fractional basis.In no
54	event shall a member be credited with more than 1 year of
55	service for all service performed during a plan year.
56	(b) "Average monthly salary" means one thirty-sixth of the
57	total amount of salary paid a member for the member's last 3
58	years of credited service, or by one sixtieth of the total
59	salary paid a member for the member's 5 best years of the last
60	10 years of service, whichever is greater. If the member does
61	not have 3 years of credited service, average monthly salary is
62	the aggregate amount of salary paid the member for the member's
63	total period of credited service divided by the member's total
64	period of credited service.
65	(2) Any member of the Police Department who is employed by
66	the police department on July 1, 2003, or initially becomes so
67	employed after July 1, 2003,may retire after 20 years of
68	credited service therein and shall receive and be paid a monthly
69	pension of an amount equal to 7060percent of his average
70	monthly salary. Said average monthly salary shall be determined
71	by computing the average monthly salary for said member's last 3
72	years of service or by computing the member's average monthly
73	salary for the 5 best years of the last 10 years of service,
74	whichever amount is greater. Provided, further, that in
75	addition to the aforesaid 7060percent pension, a member who
76	retires with more than 20 years' active service in the
77	department shall receive 24percent of said average monthly
78	salary computed as stated herein for each full year of said
79	service in excess of 20 years service. Said 24percent
80	increment shall be limited to 5 years of additional service.
81	Section 3. Present subsection (4) of section 20 of chapter
82	22414 (1943), Laws of Florida, as amended, is renumbered as
83	subsection (5), and a new subsection (4) is added to said
84	section, to read:
85	(4) Notwithstanding the provisions of subsections (1) and
86	(2), a person who is retired under the provisions of this plan
87	and who is reemployed as a sworn member of the City of Orlando
88	Police Department shall be reinstated as a participant in the
89	pension plan and upon reinstatement shall be accorded all
90	provided rights therein, provided that the retiree will not
91	receive or be entitled to any pension benefit payment during the
92	period of reemployment. Upon subsequent termination of
93	employment said member will only be entitled to receive a
94	recalculated pension payment based on total credited service and
95	average monthly salary based on months of actual service,
96	whether or not continuous, computed as provided in the plan.
97	Section 4. Section 28 is added to chapter 22414 (1943),
98	Laws of Florida, as amended, to read:
99	Section 28. BACKDROP Retirement Option Plan.--
100	(1) BACKDROP Retirement Option Plan.--The BACKDROP
101	Retirement Option Plan, hereinafter referred to as the
102	"BACKDROP," allows any eligible member who has elected to
103	participate in the BACKDROP, hereinafter referred to as a
104	"BACKDROP participant," to receive a lump-sum payment, or other
105	payment, in addition to a monthly pension, upon termination of
106	employment. No benefits shall be paid under this section unless
107	the BACKDROP participant has terminated employment.
108	(2) BACKDROP Eligibility.--Any member who is an employee
109	of the police department on July 1, 2003, or initially becomes
110	employed after July 1, 2003, may elect to participate in the
111	BACKDROP following the date upon which the member completes 21
112	years of credited service as a full-time police officer with the
113	City of Orlando and is eligible for a service retirement
114	pension. A member may participate in the BACKDROP only once.
115	(3) BACKDROP Participation.--
116	(a) A member may apply to participate in the BACKDROP by
117	submitting an application to the Board of Trustees, which shall
118	include the following:
119	1. A written election to participate in the BACKDROP.
120	Once submitted to the Board of Trustees, this election will be
121	irrevocable.
122	2. Selection of the BACKDROP participation and termination
123	dates that satisfy the limitation stated in subsections (2) and
124	(5). Such termination date shall be included in a binding
125	letter of resignation.
126	3. A properly completed BACKDROP application for a service
127	retirement pension.
128	4. A properly completed designation of named beneficiaries
129	in the event the member dies while having funds remaining in a
130	BACKDROP account.
131	5. Any other relevant information as may be required by
132	the Board of Trustees.
133	(b) The effective date of BACKDROP participation for a
134	participant who has elected to receive benefits under the
135	pension plan shall be the first day of the month selected by the
136	member to begin participation in the BACKDROP.
137	(c) A BACKDROP participant shall not accrue additional
138	credited service under the pension plan after the effective date
139	of BACKDROP participation.
140	(4) Benefits Payable Under the BACKDROP.--Under a
141	BACKDROP, an eligible member may retire with a retroactive date
142	of retirement. A member may not select a retroactive retirement
143	date earlier than the date upon which the member first became
144	eligible for a service retirement pension, and in no event shall
145	the retroactive date of retirement be more than 36 months prior
146	to the date of BACKDROP election. The monthly service retirement
147	pension shall be determined as of the retroactive retirement
148	date. The member shall then be credited with an account balance
149	in a BACKDROP account that is equal to the amount the member
150	would have received during the BACKDROP period had the member
151	received a regular service retirement pension on the retroactive
152	retirement date. Upon termination of employment, the BACKDROP
153	participant shall receive or transfer the balance of this
154	BACKDROP account, pursuant to subsection (9), and shall begin to
155	receive the monthly service retirement pension adjusted to
156	reflect the retroactive retirement date.
157	(5) BACKDROP Participation Duration.--
158	(a) An eligible member may participate in the BACKDROP for
159	a period not to exceed 36 months. Notwithstanding, BACKDROP
160	participation may not commence or continue beyond the date when
161	the member's combined years of credited service and time in the
162	BACKDROP equals 360 months.
163	(b) Notwithstanding the provisions of paragraph (a), for
164	60 days after this act becomes law, a member with more than 324
165	months of credited service may elect the BACKDROP option and
166	shall not be subject to the combined years of credited service
167	and BACKDROP participation limitation of 360 months. Said
168	member is subject to the maximum BACKDROP participation period
169	of 36 months. A member with more than 324 months of credited
170	service as of the effective date of BACKDROP who does not elect
171	to participate in the BACKDROP, as set forth herein, during this
172	one-time window period shall forfeit the right to deviate from
173	the conditions for participation in the BACKDROP set forth in
174	paragraph (a).
175	(6) BACKDROP Accounts.--Individual BACKDROP accounts shall
176	be established to account for each BACKDROP participant's
177	accrued BACKDROP benefits, but there shall be no requirement
178	that funds be segregated for any BACKDROP participant. In the
179	case of a member who selects the BACKDROP option, the amount of
180	that member's pension contributions made during the BACKDROP
181	period shall not be refunded or credited to the member.
182	(7) BACKDROP Benefits Earnings.--Any BACKDROP
183	participant's BACKDROP account shall accrue earnings at 8
184	percent simple interest compounded annually, unless the parties
185	otherwise agree.
186	(8) Cost-of-Living Increase.--A BACKDROP participant will
187	not be eligible to participate in cost-of-living increases
188	during the BACKDROP period. Cost-of-living increases will be
189	made pursuant to section 18, after the BACKDROP participant's
190	termination of employment.
191	(9) Payment Options and Conditions.--
192	(a) Following the termination of employment, the BACKDROP
193	participant, or if deceased such BACKDROP participant's
194	beneficiaries, shall elect on forms provided by the Board of
195	Trustees to receive payment of the balance of the BACKDROP
196	account in accordance with one of the options listed below. For
197	a BACKDROP participant or beneficiaries who fail to elect a
198	method of payment within 60 days of termination of employment,
199	the Board of Trustees shall pay the balance of the DROP account
200	in one lump sum as provided in subparagraph 1.
201	1. The balance of the BACKDROP account, less any taxes
202	remitted to the Internal Revenue Service, shall be paid to the
203	BACKDROP participant or beneficiaries.
204	2. The balance of the BACKDROP account shall be paid
205	directly to the custodian of an eligible retirement plan as
206	defined in applicable provisions of the Internal Revenue Code.
207	However, in the case of an eligible rollover distribution to the
208	widow or widower as a beneficiary, an eligible retirement plan
209	is an individual retirement account or an individual retirement
210	annuity as described in applicable provisions of the Internal
211	Revenue Code.
212	3. The balance of the BACKDROP account shall be paid by a
213	method that is in compliance with the Internal Revenue Code and
214	as adopted by the Board of Trustees.
215	(b) All payments and benefits shall be made in accordance
216	with applicable provisions of the Internal Revenue Code.
217	(10) Death of a BACKDROP Participant.--Upon the death of a
218	BACKDROP participant, the named BACKDROP beneficiaries shall be
219	paid the balance of the BACKDROP account in accordance with
220	subsection (9). Other pension benefits due to the participant's
221	survivors shall be paid in accordance with applicable provisions
222	of this pension plan.
223	Section 5. Cost of Benefits.--Any actuarially determined
224	additional cost resulting from the benefits in sections 2 and 4
225	of this bill shall be borne by the members of the pension plan.
226	Section 6. This act shall take effect July 1, 2003.