Senate Bill sb0286c2

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    Florida Senate - 2004                     CS for CS for SB 286

    By the Committees on Appropriations; Comprehensive Planning;
    and Senator Bennett




    309-2203-04

  1                      A bill to be entitled

  2         An act relating to agency reorganization;

  3         transferring the Division of Retirement and its

  4         powers, duties, functions, components, and

  5         assets from the Department of Management

  6         Services to the State Board of Administration;

  7         amending s. 110.205, F.S.; providing status of

  8         division personnel under the Career Service

  9         System; amending ss. 20.22, 20.28, 112.05,

10         112.3173, 112.363, 112.625, 112.63, 112.64,

11         112.658, 112.661, 112.665, 121.021, 121.025,

12         121.031, 121.051, 121.0511, 121.0515, 121.052,

13         121.055, 121.081, 121.085, 121.091, 121.095,

14         121.101, 121.111, 121.133, 121.135, 121.136,

15         121.1905, 121.192, 121.193, 121.22, 121.23,

16         121.24, 121.30, 121.35, 121.40, 121.45,

17         121.4501, 121.4503, 121.591, 121.5911, 121.72,

18         121.73, 121.74, 122.02, 122.03, 122.05, 122.06,

19         122.07, 122.08, 122.09, 122.10, 122.12, 122.13,

20         122.15, 122.16, 122.23, 122.30, 122.34,

21         122.351, 175.032, 175.121, 175.1215, 175.341,

22         185.02, 185.10, 185.105, 185.23, 215.20,

23         215.28, 215.44, 215.50, 215.52, 238.01, 238.02,

24         238.03, 238.05, 238.07, 238.08, 238.09, 238.10,

25         238.11, 238.12, 238.14, 238.15, 238.171,

26         238.181, 238.32, 650.02, 650.06, F.S., to

27         conform to such transfer; providing duties of

28         the Department of Financial Services with

29         respect to issuing benefit payments under

30         retirement plans; transferring trust funds from

31         the Department of Management Services to the

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 1         Board of Administration; providing an effective

 2         date.

 3  

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

 5  

 6         Section 1.  The Division of Retirement of the

 7  Department of Management Services is transferred to the State

 8  Board of Administration. All powers, duties, functions,

 9  records, personnel, property, and unexpended balances of

10  appropriations, allocations, and other funds relating to the

11  Division of Retirement are transferred by a type one transfer,

12  as defined in section 20.06, Florida Statutes, to the State

13  Board of Administration. This act does not alter or amend the

14  powers, operations, or functioning of the State Board of

15  Administration with respect to its duties, responsibilities,

16  and authority existing prior to the enactment of this

17  legislation.

18         Section 2.  Paragraphs (g) and (h) of subsection (2) of

19  section 20.22, Florida Statutes, are amended to read:

20         20.22  Department of Management Services.--There is

21  created a Department of Management Services.

22         (2)  The following divisions and programs within the

23  Department of Management Services are established:

24         (g)  Division of Retirement.

25         (g)(h)  Division of State Group Insurance.

26         Section 3.  Section 20.28, Florida Statutes, is amended

27  to read:

28         20.28  State Board of Administration.--The State Board

29  of Administration, continued by s. 4(e), Art. IV s. 9, Art.

30  XII of the State Constitution, retains all of its powers,

31  duties, and functions as prescribed by law. There is

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 1  established under the State Board of Administration a Division

 2  of Retirement, which shall be subject to the direction of the

 3  executive director of the board who is the agency head of the

 4  division for purposes of chapter 120.

 5         Section 4.  Paragraph (u) of subsection (2) of section

 6  110.205, Florida Statutes, is amended to read:

 7         110.205  Career service; exemptions.--

 8         (2)  EXEMPT POSITIONS.--The exempt positions that are

 9  not covered by this part include the following:

10         (u)  All officers and employees of the State Board of

11  Administration, including its Division of Retirement. The

12  State Board of Administration shall set the salaries and

13  benefits of these positions.

14         Section 5.  Paragraph (b) of subsection (4) of section

15  112.05, Florida Statutes, is amended to read:

16         112.05  Retirement; cost-of-living adjustment;

17  employment after retirement.--

18         (4)

19         (b)  Any person to whom the limitation in paragraph (a)

20  applies who violates such reemployment limitation and is

21  reemployed with any agency participating in the Florida

22  Retirement System prior to completion of the 12-month

23  limitation period shall give timely notice of this fact in

24  writing to the employer and to the Department of Management

25  Services Division; and the person's retirement benefits shall

26  be suspended for the balance of the 12-month limitation

27  period. Any person employed in violation of this subsection

28  and any employing agency which knowingly employs or appoints

29  such person without notifying the Department of Management

30  Services to suspend retirement benefits shall be jointly and

31  severally liable for reimbursement to the retirement trust

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 1  fund of any benefits paid during the reemployment limitation

 2  period. To avoid liability, such employing agency shall have a

 3  written statement from the retiree that he or she is not

 4  retired from a state-administered retirement system. Any

 5  retirement benefits received by such person while reemployed

 6  during this limitation period shall be repaid to the

 7  retirement trust fund, and the retirement benefits shall

 8  remain suspended until such repayment has been made. Any

 9  benefits suspended beyond the reemployment limitation period

10  shall apply toward the repayment of benefits received in

11  violation of the reemployment limitation.

12         Section 6.  Paragraph (d) of subsection (4) of section

13  112.3173, Florida Statutes, is amended to read:

14         112.3173  Felonies involving breach of public trust and

15  other specified offenses by public officers and employees;

16  forfeiture of retirement benefits.--

17         (4)  NOTICE.--

18         (d)  The Commission on Ethics shall forward any notice

19  and any other document received by it pursuant to this

20  subsection to the governing body of the public retirement

21  system of which the public officer or employee is a member or

22  from which the public officer or employee may be entitled to

23  receive a benefit. When called on by the Commission on Ethics,

24  the Division of Retirement of the State Board of

25  Administration Department of Management Services shall assist

26  the commission in identifying the appropriate public

27  retirement system.

28         Section 7.  Subsections (2), (4), (5), (7), and (8) of

29  section 112.363, Florida Statutes, are amended to read:

30         112.363  Retiree health insurance subsidy.--

31  

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 1         (2)  ELIGIBILITY FOR RETIREE HEALTH INSURANCE

 2  SUBSIDY.--

 3         (a)  A person who is retired under a state-administered

 4  retirement system, or a beneficiary who is a spouse or

 5  financial dependent entitled to receive benefits under a

 6  state-administered retirement system, is eligible for health

 7  insurance subsidy payments provided under this section; except

 8  that pension recipients under ss. 121.40, 238.07(16)(a), and

 9  250.22, recipients of health insurance coverage under s.

10  110.1232, or any other special pension or relief act shall not

11  be eligible for such payments.

12         (b)  For purposes of this section, a person is deemed

13  retired from a state-administered retirement system when he or

14  she terminates employment with all employers participating in

15  the Florida Retirement System as described in s. 121.021(39)

16  and:

17         1.  For a participant of the Public Employee Optional

18  Retirement Program established under part II of chapter 121,

19  the participant meets the age or service requirements to

20  qualify for normal retirement as set forth in s. 121.021(29).

21         2.  For a member of the Florida Retirement System

22  defined benefit program, or any employee who maintains

23  creditable service under both the defined benefit program and

24  the Public Employee Optional Retirement Program, the member

25  begins drawing retirement benefits from the defined benefit

26  program of the Florida Retirement System.

27         (c)1.  Effective July 1, 2001, any person retiring on

28  or after such date as a member of the Florida Retirement

29  System, including any participant of the defined contribution

30  program administered pursuant to part II of chapter 121, must

31  have satisfied the vesting requirements for his or her

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 1  membership class under the Florida Retirement System defined

 2  benefit program as administered under part I of chapter 121.

 3         2.  Notwithstanding the provisions of subparagraph 1.,

 4  a person retiring due to disability must either qualify for a

 5  regular or in-line-of-duty disability benefit as provided in

 6  s. 121.091(4) or qualify for a disability benefit under a

 7  disability plan established under part II of chapter 121, as

 8  appropriate.

 9         (d)  Payment of the retiree health insurance subsidy

10  shall be made only after coverage for health insurance for the

11  retiree or beneficiary has been certified in writing to the

12  Division of Retirement of the State Board of Administration

13  Department of Management Services. Participation in a former

14  employer's group health insurance program is not a requirement

15  for eligibility under this section.

16         (e)  Participants in the Senior Management Service

17  Optional Annuity Program as provided in s. 121.055(6) and the

18  State University System Optional Retirement Program as

19  provided in s. 121.35 shall not receive the retiree health

20  insurance subsidy provided in this section. The employer of

21  such participant shall pay the contributions required in

22  subsection (8) to the annuity program provided in s.

23  121.055(6)(d) or s. 121.35(4)(a), as applicable.

24         (4)  PAYMENT OF RETIREE HEALTH INSURANCE

25  SUBSIDY.--Beginning January 1, 1988, any monthly retiree

26  health insurance subsidy amount due and payable under this

27  section shall be paid to retired members by the Division of

28  Retirement of the State Board of Administration Department of

29  Management Services or under the direction and control of the

30  division department.

31  

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 1         (5)  TRUST FUND ESTABLISHED.--There is hereby

 2  established a trust fund in the state treasury to be entitled

 3  the Retiree Health Insurance Subsidy Trust Fund, which shall

 4  be administered by the State Board of Administration. Said

 5  trust fund shall be used to account for all moneys received

 6  and disbursed pursuant to this section.  Should funding for

 7  the retiree health insurance subsidy program fail to provide

 8  full benefits for all participants, the benefits may be

 9  reduced or canceled at any time.

10         (7)  ADMINISTRATION OF SYSTEM.--The Division of

11  Retirement of the State Board of Administration Department of

12  Management Services may adopt such rules and regulations as

13  are necessary for the effective and efficient administration

14  of this section. The cost of administration is shall be

15  appropriated from the trust fund.

16         (8)  CONTRIBUTIONS.--For purposes of funding the

17  insurance subsidy provided by this section:

18         (a)  Beginning October 1, 1987, the employer of each

19  member of a state-administered retirement plan shall

20  contribute 0.24 percent of gross compensation each pay period.

21         (b)  Beginning January 1, 1989, the employer of each

22  member of a state-administered retirement plan shall

23  contribute 0.48 percent of gross compensation each pay period.

24         (c)  Beginning January 1, 1994, the employer of each

25  member of a state-administered retirement plan shall

26  contribute 0.56 percent of gross compensation each pay period.

27         (d)  Beginning January 1, 1995, the employer of each

28  member of a state-administered retirement plan shall

29  contribute 0.66 percent of gross compensation each pay period.

30  

31  

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 1         (e)  Beginning July 1, 1998, the employer of each

 2  member of a state-administered retirement plan shall

 3  contribute 0.94 percent of gross compensation each pay period.

 4         (f)  Beginning July 1, 2001, the employer of each

 5  member of a state-administered plan shall contribute 1.11

 6  percent of gross compensation each pay period.

 7  

 8  Such contributions shall be submitted to the Division of

 9  Retirement of the State Board of Administration Department of

10  Management Services and deposited in the Retiree Health

11  Insurance Subsidy Trust Fund.

12         Section 8.  Subsection (10) is added to section

13  112.625, Florida Statutes, to read:

14         112.625  Definitions.--As used in this act:

15         (10)  "Division" means the Division of Retirement of

16  the State Board of Administration.

17         Section 9.  Subsections (2) and (4) of section 112.63,

18  Florida Statutes, are amended to read:

19         112.63  Actuarial reports and statements of actuarial

20  impact; review.--

21         (2)  The frequency of actuarial reports must be at

22  least every 3 years commencing from the last actuarial report

23  of the plan or system or October 1, 1980, if no actuarial

24  report has been issued within the 3-year period prior to

25  October 1, 1979. The results of each actuarial report shall be

26  filed with the plan administrator within 60 days of

27  certification. Thereafter, the results of each actuarial

28  report shall be made available for inspection upon request.

29  Additionally, each retirement system or plan covered by this

30  act which is not administered directly by the division

31  Department of Management Services shall furnish a copy of each

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 1  actuarial report to the division Department of Management

 2  Services within 60 days after receipt from the actuary. The

 3  requirements of this section are supplemental to actuarial

 4  valuations necessary to comply with the requirements of ss.

 5  218.321 and 218.39.

 6         (4)  Upon receipt, pursuant to subsection (2), of an

 7  actuarial report, or upon receipt, pursuant to subsection (3),

 8  of a statement of actuarial impact, the division Department of

 9  Management Services shall acknowledge such receipt, but shall

10  only review and comment on each retirement system's or plan's

11  actuarial valuations at least on a triennial basis. If the

12  division department finds that the actuarial valuation is not

13  complete, accurate, or based on reasonable assumptions, or if

14  the division department does not receive the actuarial report

15  or statement of actuarial impact, the division department

16  shall notify the local government and request appropriate

17  adjustment. If, after a reasonable period of time, a

18  satisfactory adjustment is not made, the affected local

19  government or the division department may petition for a

20  hearing under the provisions of ss. 120.569 and 120.57. If the

21  administrative law judge recommends in favor of the division

22  department, the division department shall perform an actuarial

23  review or prepare the statement of actuarial impact. The cost

24  to the division department of performing such actuarial review

25  or preparing such statement shall be charged to the

26  governmental entity of which the employees are covered by the

27  retirement system or plan. If payment of such costs is not

28  received by the division department within 60 days after

29  receipt by the governmental entity of the request for payment,

30  the division department shall certify to the Chief Financial

31  Officer the amount due, and the Chief Financial Officer shall

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 1  pay such amount to the division department from any funds

 2  payable to the governmental entity of which the employees are

 3  covered by the retirement system or plan. If the

 4  administrative law judge recommends in favor of the local

 5  retirement system and the division department performs an

 6  actuarial review, the cost to the division department of

 7  performing the actuarial review shall be paid by the division

 8  department.

 9         Section 10.  Subsection (1) of section 112.64, Florida

10  Statutes, is amended to read:

11         112.64  Administration of funds; amortization of

12  unfunded liability.--

13         (1)  Employee contributions shall be deposited in the

14  retirement system or plan at least monthly. Employer

15  contributions shall be deposited at least quarterly; however,

16  any revenues received from any source by an employer which are

17  specifically collected for the purpose of allocation for

18  deposit into a retirement system or plan shall be so deposited

19  within 30 days of receipt by the employer. All employers and

20  employees participating in the Florida Retirement System and

21  other existing retirement systems which are administered by

22  the division Department of Management Services shall continue

23  to make contributions at least monthly.

24         Section 11.  Subsections (1) and (3) of section

25  112.658, Florida Statutes, are amended to read:

26         112.658  Office of Program Policy Analysis and

27  Government Accountability to determine compliance of the

28  Florida Retirement System.--

29         (1)  The Office of Program Policy Analysis and

30  Government Accountability shall determine, through the

31  examination of actuarial reviews, financial statements, and

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 1  the practices and procedures of the Division of Retirement

 2  Department of Management Services, the compliance of the

 3  Florida Retirement System with the provisions of this act.

 4         (3)  The Office of Program Policy Analysis and

 5  Government Accountability shall employ the same actuarial

 6  standards to monitor the division Department of Management

 7  Services as the division Department of Management Services

 8  uses to monitor local governments.

 9         Section 12.  Subsections (9), (16), and (17) of section

10  112.661, Florida Statutes, are amended to read:

11         112.661  Investment policies.--Investment of the assets

12  of any local retirement system or plan must be consistent with

13  a written investment policy adopted by the board. Such

14  policies shall be structured to maximize the financial return

15  to the retirement system or plan consistent with the risks

16  incumbent in each investment and shall be structured to

17  establish and maintain an appropriate diversification of the

18  retirement system or plan's assets.

19         (9)  EXPECTED ANNUAL RATE OF RETURN.--The investment

20  policy shall require that, for each actuarial valuation, the

21  board determine the total expected annual rate of return for

22  the current year, for each of the next several years, and for

23  the long term thereafter. This determination must be filed

24  promptly with the division Department of Management Services

25  and with the plan's sponsor and the consulting actuary. The

26  division department shall use this determination only to

27  notify the board, the plan's sponsor, and consulting actuary

28  of material differences between the total expected annual rate

29  of return and the actuarial assumed rate of return.

30         (16)  FILING OF INVESTMENT POLICY.--Upon adoption by

31  the board, the investment policy shall be promptly filed with

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 1  the division Department of Management Services and the plan's

 2  sponsor and consulting actuary. The effective date of the

 3  investment policy, and any amendment thereto, shall be the

 4  31st calendar day following the filing date with the plan

 5  sponsor.

 6         (17)  VALUATION OF ILLIQUID INVESTMENTS.--The

 7  investment policy shall provide for the valuation of illiquid

 8  investments for which a generally recognized market is not

 9  available or for which there is no consistent or generally

10  accepted pricing mechanism. If those investments are utilized,

11  the investment policy must include the criteria set forth in

12  s. 215.47(6), except that submission to the Investment

13  Advisory Council is not required. The investment policy shall

14  require that, for each actuarial valuation, the board must

15  verify the determination of the fair market value for those

16  investments and ascertain that the determination complies with

17  all applicable state and federal requirements. The investment

18  policy shall require that the board disclose to the division

19  Department of Management Services and the plan's sponsor each

20  such investment for which the fair market value is not

21  provided.

22         Section 13.  Section 112.665, Florida Statutes, is

23  amended to read:

24         112.665  Duties of Division of Retirement Department of

25  Management Services.--

26         (1)  The Division of Retirement Department of

27  Management Services shall:

28         (a)  Gather, catalog, and maintain complete,

29  computerized data information on all public employee

30  retirement systems or plans in the state, based upon a review

31  

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 1  of audits, reports, and other data pertaining to the systems

 2  or plans;

 3         (b)  Receive and comment upon all actuarial reviews of

 4  retirement systems or plans maintained by units of local

 5  government;

 6         (c)  Cooperate with local retirement systems or plans

 7  on matters of mutual concern and provide technical assistance

 8  to units of local government in the assessment and revision of

 9  retirement systems or plans;

10         (d)  Issue, by January 1 annually, a report to the

11  President of the Senate and the Speaker of the House of

12  Representatives, which report details division activities,

13  findings, and recommendations concerning all governmental

14  retirement systems. The report may include legislation

15  proposed to carry out such recommendations;

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

17  Special District Information Program of the Department of

18  Community Affairs that includes the participation in and

19  compliance of special districts with the local government

20  retirement system provisions in s. 112.63 and the

21  state-administered retirement system provisions as specified

22  in part I of chapter 121; and

23         (f)  Adopt reasonable rules to administer the

24  provisions of this part.

25         (2)  The division department may subpoena actuarial

26  witnesses, review books and records, hold hearings, and take

27  testimony. A witness shall have the right to be accompanied by

28  counsel.

29         Section 14.  Subsections (4), (5), (32), and (36) and

30  paragraph (a) of subsection (39) of section 121.021, Florida

31  

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 1  Statutes, are amended, and subsection (62) is added to that

 2  section, to read:

 3         121.021  Definitions.--The following words and phrases

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

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

 6         (4)  "Division Department" means the Division of

 7  Retirement of the State Board of Administration Department of

 8  Management Services.

 9         (5)  "Administrator" means the executive director of

10  the State Board of Administration secretary of the Department

11  of Management Services.

12         (32)  "State agency" means the Division of Retirement

13  Department of Management Services within the provisions and

14  contemplation of chapter 650.

15         (36)  "System Trust Fund" means the trust fund

16  established in the State Treasury by this chapter and

17  administered by the State Board of Administration for the

18  purpose of holding and investing the contributions paid by

19  members and employers and paying the benefits to which members

20  or their beneficiaries may become entitled.  Other trust funds

21  may be established in the State Treasury to administer the

22  "System Trust Fund."

23         (39)(a)  "Termination" occurs, except as provided in

24  paragraph (b), when a member ceases all employment

25  relationships with employers under this system, as defined in

26  subsection (10), but in the event a member should be employed

27  by any such employer within the next calendar month,

28  termination shall be deemed not to have occurred. A leave of

29  absence shall constitute a continuation of the employment

30  relationship, except that a leave of absence without pay due

31  to disability may constitute termination for a member, if such

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 1  member makes application for and is approved for disability

 2  retirement in accordance with s. 121.091(4). The division

 3  department may require other evidence of termination as it

 4  deems necessary.

 5         (62)  "Board" means the State Board of Administration.

 6         Section 15.  Section 121.025, Florida Statutes, is

 7  amended to read:

 8         121.025  Administrator; powers and duties.--The

 9  executive director of the State Board of Administration

10  secretary of the Department of Management Services shall be

11  the administrator of the retirement and pension systems

12  assigned or transferred to the division Department of

13  Management Services by law. The executive director of the

14  State Board of Administration is the trustee of the System

15  Trust Fund and shall have the authority to sign the contracts

16  necessary to carry out the duties and responsibilities

17  assigned by law to the division Department of Management

18  Services.

19         Section 16.  Subsections (1), (2), and (5) and

20  paragraph (e) of subsection (3) of section 121.031, Florida

21  Statutes, are amended to read:

22         121.031  Administration of system; appropriation;

23  oaths; actuarial studies; public records.--

24         (1)  The division Department of Management Services has

25  the authority to adopt rules pursuant to ss. 120.536(1) and

26  120.54 to implement the provisions of law conferring duties

27  upon the division department and to adopt rules as are

28  necessary for the effective and efficient administration of

29  this system. The funds to pay the expenses for administration

30  of the system are hereby appropriated from the interest earned

31  

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 1  on investments made for the retirement and social security

 2  trust funds and the assessments allowed under chapter 650.

 3         (2)  The division Department of Management Services is

 4  authorized to require oaths, by affidavit or otherwise, and

 5  acknowledgments from persons in connection with the

 6  administration of its duties and responsibilities under this

 7  chapter.

 8         (3)  The administrator shall cause an actuarial study

 9  of the system to be made at least annually and shall report

10  the results of such study to the Legislature by December 31

11  prior to the next legislative session. The study shall, at a

12  minimum, conform to the requirements of s. 112.63, with the

13  following exceptions and additions:

14         (e)  The study shall include measures of funding status

15  and funding progress designed to facilitate the assessment of

16  trends over several actuarial valuations with respect to the

17  overall solvency of the system. Such measures shall be adopted

18  by the division department and shall be used consistently in

19  all actuarial valuations performed on the system.

20         (5)  The names and addresses of retirees are

21  confidential and exempt from the provisions of s. 119.07(1) to

22  the extent that no state or local governmental agency may

23  provide the names or addresses of such persons in aggregate,

24  compiled, or list form to any person except to a public agency

25  engaged in official business. However, a state or local

26  government agency may provide the names and addresses of

27  retirees from that agency to a bargaining agent as defined in

28  s. 447.203(12) or to a retiree organization for official

29  business use. Lists of names or addresses of retirees may be

30  exchanged by public agencies, but such lists shall not be

31  provided to, or open for inspection by, the public. Any person

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 1  may view or copy any individual's retirement records at the

 2  division Department of Management Services, one record at a

 3  time, or may obtain information by a separate written request

 4  for a named individual for which information is desired.

 5         Section 17.  Paragraph (c) of subsection (1) and

 6  paragraphs (b) and (f) of subsection (2) of section 121.051,

 7  Florida Statutes, are amended to read:

 8         121.051  Participation in the system.--

 9         (1)  COMPULSORY PARTICIPATION.--

10         (c)1.  After June 30, 1983, a member of an existing

11  system who is reemployed after terminating employment shall

12  have at the time of reemployment the option of selecting to

13  remain in the existing retirement system or to transfer to the

14  Florida Retirement System.  Failure to submit such selection

15  in writing to the division Department of Management Services

16  within 6 months of reemployment shall result in compulsory

17  membership in the Florida Retirement System.

18         2.  After June 30, 1988, the provisions of subparagraph

19  1. shall not apply to a member of an existing system who is

20  reemployed within 12 months after terminating employment. Such

21  member shall continue to have membership in the existing

22  system upon reemployment and shall not be permitted to become

23  a member of the Florida Retirement System, except by

24  transferring to that system as provided in ss. 121.052 and

25  121.055.

26         (2)  OPTIONAL PARTICIPATION.--

27         (b)1.  The governing body of any municipality or

28  special district in the state may elect to participate in the

29  system upon proper application to the administrator and may

30  cover all or any of its units as approved by the Secretary of

31  Health and Human Services and the administrator. The division

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 1  department shall adopt rules establishing provisions for the

 2  submission of documents necessary for such application. Prior

 3  to being approved for participation in the Florida Retirement

 4  System, the governing body of any such municipality or special

 5  district that has a local retirement system shall submit to

 6  the administrator a certified financial statement showing the

 7  condition of the local retirement system as of a date within 3

 8  months prior to the proposed effective date of membership in

 9  the Florida Retirement System. The statement must be certified

10  by a recognized accounting firm that is independent of the

11  local retirement system. All required documents necessary for

12  extending Florida Retirement System coverage must be received

13  by the division department for consideration at least 15 days

14  prior to the proposed effective date of coverage. If the

15  municipality or special district does not comply with this

16  requirement, the division department may require that the

17  effective date of coverage be changed.

18         2.  Any city or special district that has an existing

19  retirement system covering the employees in the units that are

20  to be brought under the Florida Retirement System may

21  participate only after holding a referendum in which all

22  employees in the affected units have the right to participate.

23  Only those employees electing coverage under the Florida

24  Retirement System by affirmative vote in said referendum shall

25  be eligible for coverage under this chapter, and those not

26  participating or electing not to be covered by the Florida

27  Retirement System shall remain in their present systems and

28  shall not be eligible for coverage under this chapter. After

29  the referendum is held, all future employees shall be

30  compulsory members of the Florida Retirement System.

31  

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 1         3.  The governing body of any city or special district

 2  complying with subparagraph 1. may elect to provide, or not

 3  provide, benefits based on past service of officers and

 4  employees as described in s. 121.081(1). However, if such

 5  employer elects to provide past service benefits, such

 6  benefits must be provided for all officers and employees of

 7  its covered group.

 8         4.  Once this election is made and approved it may not

 9  be revoked, except pursuant to subparagraphs 5. and 6., and

10  all present officers and employees electing coverage under

11  this chapter and all future officers and employees shall be

12  compulsory members of the Florida Retirement System.

13         5.  Subject to the conditions set forth in subparagraph

14  6., the governing body of any hospital licensed under chapter

15  395 which is governed by the board of a special district as

16  defined in s. 189.403(1) or by the board of trustees of a

17  public health trust created under s. 154.07, hereinafter

18  referred to as "hospital district," and which participates in

19  the system, may elect to cease participation in the system

20  with regard to future employees in accordance with the

21  following procedure:

22         a.  No more than 30 days and at least 7 days before

23  adopting a resolution to partially withdraw from the Florida

24  Retirement System and establish an alternative retirement plan

25  for future employees, a public hearing must be held on the

26  proposed withdrawal and proposed alternative plan.

27         b.  From 7 to 15 days before such hearing, notice of

28  intent to withdraw, specifying the time and place of the

29  hearing, must be provided in writing to employees of the

30  hospital district proposing partial withdrawal and must be

31  published in a newspaper of general circulation in the area

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 1  affected, as provided by ss. 50.011-50.031.  Proof of

 2  publication of such notice shall be submitted to the division

 3  Department of Management Services.

 4         c.  The governing body of any hospital district seeking

 5  to partially withdraw from the system must, before such

 6  hearing, have an actuarial report prepared and certified by an

 7  enrolled actuary, as defined in s. 112.625(3), illustrating

 8  the cost to the hospital district of providing, through the

 9  retirement plan that the hospital district is to adopt,

10  benefits for new employees comparable to those provided under

11  the Florida Retirement System.

12         d.  Upon meeting all applicable requirements of this

13  subparagraph, and subject to the conditions set forth in

14  subparagraph 6., partial withdrawal from the system and

15  adoption of the alternative retirement plan may be

16  accomplished by resolution duly adopted by the hospital

17  district board.  The hospital district board must provide

18  written notice of such withdrawal to the division by mailing a

19  copy of the resolution to the division, postmarked no later

20  than December 15, 1995.  The withdrawal shall take effect

21  January 1, 1996.

22         6.  Following the adoption of a resolution under

23  sub-subparagraph 5.d., all employees of the withdrawing

24  hospital district who were participants in the Florida

25  Retirement System prior to January 1, 1996, shall remain as

26  participants in the system for as long as they are employees

27  of the hospital district, and all rights, duties, and

28  obligations between the hospital district, the system, and the

29  employees shall remain in full force and effect. Any employee

30  who is hired or appointed on or after January 1, 1996, may not

31  participate in the Florida Retirement System, and the

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 1  withdrawing hospital district shall have no obligation to the

 2  system with respect to such employees.

 3         (f)1.  Whenever an employer that participates in the

 4  Florida Retirement System undertakes the transfer, merger, or

 5  consolidation of governmental services or functions, the

 6  employer must notify the division department at least 60 days

 7  prior to such action and shall provide documentation as

 8  required by the division department.

 9         2.  When the agency to which a member's employing unit

10  is transferred, merged, or consolidated does not participate

11  in the Florida Retirement System, a member shall elect in

12  writing to remain in the Florida Retirement System or to

13  transfer to the local retirement system operated by such

14  agency. If such agency does not participate in a local

15  retirement system, the member shall continue membership in the

16  Florida Retirement System. In either case, the membership

17  shall continue for as long as the member is employed by the

18  agency to which his or her unit was transferred, merged, or

19  consolidated.

20         Section 18.  Subsection (2) of section 121.0511,

21  Florida Statutes, is amended to read:

22         121.0511  Revocation of election and alternative

23  plan.--The governing body of any municipality or independent

24  special district that has elected to participate in the

25  Florida Retirement System may revoke its election in

26  accordance with the following procedure:

27         (2)  At least 7 days, but not more than 15 days, before

28  the hearing, notice of intent to revoke, specifying the time

29  and place of the hearing, must be published in a newspaper of

30  general circulation in the area affected, as provided by ss.

31  

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 1  50.011-50.031. Proof of publication of the notice must be

 2  submitted to the division Department of Management Services.

 3         Section 19.  Subsections (3) and (4) and paragraph (c)

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

 5  amended to read:

 6         121.0515  Special risk membership.--

 7         (3)  PROCEDURE FOR DESIGNATING.--

 8         (a)  Any member of the Florida Retirement System

 9  employed by a county, city, or special district who feels that

10  he or she meets the criteria set forth in this section for

11  membership in the Special Risk Class may request that his or

12  her employer submit an application to the division department

13  requesting that the division department designate him or her

14  as a special risk member. If the employer agrees that the

15  member meets the requirements for special risk membership, the

16  employer shall submit an application to the division

17  department in behalf of the employee containing a

18  certification that the member meets the criteria for special

19  risk membership set forth in this section and such other

20  supporting documentation as may be required by administrative

21  rule. The division department shall, within 90 days, either

22  designate or refuse to designate the member as a special risk

23  member. If the employer declines to submit the member's

24  application to the division department or if the division

25  department does not designate the member as a special risk

26  member, the member or the employer may appeal to the State

27  Retirement Commission, as provided in s. 121.23, for

28  designation as a special risk member. A member who receives a

29  final affirmative ruling pursuant to such appeal for special

30  risk membership shall have special risk membership retroactive

31  to the date such member would have had special risk membership

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 1  had such membership been approved by the employer and the

 2  division department, as determined by the division department,

 3  and the employer contributions shall be paid in full within 1

 4  year after such final ruling.

 5         (b)1.  Applying the criteria set forth in this section,

 6  the division Department of Management Services shall specify

 7  which current and newly created classes of positions under the

 8  uniform classification plan established pursuant to chapter

 9  110 entitle the incumbents of positions in those classes to

10  membership in the Special Risk Class. Only employees employed

11  in the classes so specified shall be special risk members.

12         2.  When a class is not specified by the division

13  department as provided in subparagraph 1., the employing

14  agency may petition the State Retirement Commission for

15  approval in accordance with s. 121.23.

16         (4)  REMOVAL OF SPECIAL RISK MEMBERSHIP.--Any member

17  who is a special risk member on October 1, 1978, and who fails

18  to meet the criteria for special risk membership established

19  by this section shall have his or her special risk designation

20  removed and thereafter shall be a regular member and shall

21  earn only regular membership credit. The division department

22  shall have the authority to review the special risk

23  designation of members to determine whether or not those

24  members continue to meet the criteria for special risk

25  membership.

26         (7)  RETENTION OF SPECIAL RISK NORMAL RETIREMENT

27  DATE.--

28         (c)  The division department shall adopt such rules as

29  are required to administer this subsection.

30         Section 20.  Paragraph (e) of subsection (3) of section

31  121.052, Florida Statutes, is amended to read:

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 1         121.052  Membership class of elected officers.--

 2         (3)  PARTICIPATION AND WITHDRAWAL,

 3  GENERALLY.--Effective July 1, 1990, participation in the

 4  Elected Officers' Class shall be compulsory for elected

 5  officers listed in paragraphs (2)(a)-(d) and (f) assuming

 6  office on or after said date, unless the elected officer

 7  elects membership in another class or withdraws from the

 8  Florida Retirement System as provided in paragraphs

 9  (3)(a)-(d):

10         (e)  Effective July 1, 2001, the governing body of a

11  municipality or special district may, by majority vote, elect

12  to designate all its elected positions for inclusion in the

13  Elected Officers' Class. Such election shall be made between

14  July 1, 2001, and December 31, 2001, and shall be irrevocable.

15  The designation of such positions shall be effective the first

16  day of the month following receipt by the division department

17  of the ordinance or resolution passed by the governing body.

18         Section 21.  Paragraphs (b) and (h) of subsection (1)

19  and paragraphs (a), (c), (d), and (f) of subsection (6) of

20  section 121.055, Florida Statutes, are amended to read:

21         121.055  Senior Management Service Class.--There is

22  hereby established a separate class of membership within the

23  Florida Retirement System to be known as the "Senior

24  Management Service Class," which shall become effective

25  February 1, 1987.

26         (1)

27         (b)1.  Except as provided in subparagraph 2., effective

28  January 1, 1990, participation in the Senior Management

29  Service Class shall be compulsory for the president of each

30  community college, the manager of each participating city or

31  county, and all appointed district school superintendents.

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 1  Effective January 1, 1994, additional positions may be

 2  designated for inclusion in the Senior Management Service

 3  Class of the Florida Retirement System, provided that:

 4         a.  Positions to be included in the class shall be

 5  designated by the local agency employer.  Notice of intent to

 6  designate positions for inclusion in the class shall be

 7  published once a week for 2 consecutive weeks in a newspaper

 8  of general circulation published in the county or counties

 9  affected, as provided in chapter 50.

10         b.  Up to 10 nonelective full-time positions may be

11  designated for each local agency employer reporting to the

12  division Department of Management Services; for local agencies

13  with 100 or more regularly established positions, additional

14  nonelective full-time positions may be designated, not to

15  exceed 1 percent of the regularly established positions within

16  the agency.

17         c.  Each position added to the class must be a

18  managerial or policymaking position filled by an employee who

19  is not subject to continuing contract and serves at the

20  pleasure of the local agency employer without civil service

21  protection, and who:

22         (I)  Heads an organizational unit; or

23         (II)  Has responsibility to effect or recommend

24  personnel, budget, expenditure, or policy decisions in his or

25  her areas of responsibility.

26         2.  In lieu of participation in the Senior Management

27  Service Class, members of the Senior Management Service Class

28  pursuant to the provisions of subparagraph 1. may withdraw

29  from the Florida Retirement System altogether. The decision to

30  withdraw from the Florida Retirement System shall be

31  irrevocable for as long as the employee holds such a position.

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 1  Any service creditable under the Senior Management Service

 2  Class shall be retained after the member withdraws from the

 3  Florida Retirement System; however, additional service credit

 4  in the Senior Management Service Class shall not be earned

 5  after such withdrawal.  Such members shall not be eligible to

 6  participate in the Senior Management Service Optional Annuity

 7  Program.

 8         (h)1.  Except as provided in subparagraph 3., effective

 9  January 1, 1994, participation in the Senior Management

10  Service Class shall be compulsory for the State Courts

11  Administrator and the Deputy State Courts Administrators, the

12  Clerk of the Supreme Court, the Marshal of the Supreme Court,

13  the Executive Director of the Justice Administrative

14  Commission, the Capital Collateral Regional Counsels, the

15  clerks of the district courts of appeals, the marshals of the

16  district courts of appeals, and the trial court administrator

17  and the Chief Deputy Court Administrator in each judicial

18  circuit. Effective January 1, 1994, additional positions in

19  the offices of the state attorney and public defender in each

20  judicial circuit may be designated for inclusion in the Senior

21  Management Service Class of the Florida Retirement System,

22  provided that:

23         a.  Positions to be included in the class shall be

24  designated by the state attorney or public defender, as

25  appropriate.  Notice of intent to designate positions for

26  inclusion in the class shall be published once a week for 2

27  consecutive weeks in a newspaper of general circulation

28  published in the county or counties affected, as provided in

29  chapter 50.

30         b.  One nonelective full-time position may be

31  designated for each state attorney and public defender

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 1  reporting to the division Department of Management Services;

 2  for agencies with 200 or more regularly established positions

 3  under the state attorney or public defender, additional

 4  nonelective full-time positions may be designated, not to

 5  exceed 0.5 percent of the regularly established positions

 6  within the agency.

 7         c.  Each position added to the class must be a

 8  managerial or policymaking position filled by an employee who

 9  serves at the pleasure of the state attorney or public

10  defender without civil service protection, and who:

11         (I)  Heads an organizational unit; or

12         (II)  Has responsibility to effect or recommend

13  personnel, budget, expenditure, or policy decisions in his or

14  her areas of responsibility.

15         2.  Participation in this class shall be compulsory,

16  except as provided in subparagraph 3., for any judicial

17  employee who holds a position designated for coverage in the

18  Senior Management Service Class, and such participation shall

19  continue until the employee terminates employment in a covered

20  position. Effective January 1, 2001, participation in this

21  class is compulsory for assistant state attorneys, assistant

22  statewide prosecutors, assistant public defenders, and

23  assistant capital collateral regional counsels. Effective

24  January 1, 2002, participation in this class is compulsory for

25  assistant attorneys general.

26         3.  In lieu of participation in the Senior Management

27  Service Class, such members, excluding assistant state

28  attorneys, assistant public defenders, assistant statewide

29  prosecutors, assistant attorneys general, and assistant

30  capital collateral regional counsels, may participate in the

31  

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 1  Senior Management Service Optional Annuity Program as

 2  established in subsection (6).

 3         (6)(a)  Senior Management Service Optional Annuity

 4  Program.--The State Board of Administration Department of

 5  Management Services shall establish a Senior Management

 6  Service Optional Annuity Program under which contracts

 7  providing retirement, death, and disability benefits may be

 8  purchased for those employees who elect to participate in the

 9  optional annuity program.  The benefits to be provided for or

10  on behalf of participants in such optional annuity program

11  shall be provided through individual contracts or individual

12  certificates issued for group annuity contracts, which may be

13  fixed, variable, or a combination thereof, in accordance with

14  s. 401(a) of the Internal Revenue Code.  Any such individual

15  contract or certificate shall state the annuity plan on its

16  face page, and shall include, but not be limited to, a

17  statement of ownership, the contract benefits, annuity income

18  options, limitations, expense charges, and surrender charges,

19  if any.  The employing agency shall contribute, as provided in

20  this section, toward the purchase of such optional benefits

21  which shall be fully and immediately vested in the

22  participants.

23         (c)  Participation.--

24         1.  Any eligible employee who is employed on or before

25  February 1, 1987, may elect to participate in the optional

26  annuity program in lieu of participation in the Senior

27  Management Service Class.  Such election shall be made in

28  writing and filed with the board department and the personnel

29  officer of the employer on or before May 1, 1987.  Any

30  eligible employee who is employed on or before February 1,

31  1987, and who fails to make an election to participate in the

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 1  optional annuity program by May 1, 1987, shall be deemed to

 2  have elected membership in the Senior Management Service

 3  Class.

 4         2.  Any employee who becomes eligible to participate in

 5  the optional annuity program by reason of initial employment

 6  commencing after February 1, 1987, may, within 90 days after

 7  the date of commencement of employment, elect to participate

 8  in the optional annuity program.  Such election shall be made

 9  in writing and filed with the personnel officer of the

10  employer.  Any eligible employee who does not within 90 days

11  after commencement of such employment elect to participate in

12  the optional annuity program shall be deemed to have elected

13  membership in the Senior Management Service Class.

14         3.  A person who is appointed to a position in the

15  Senior Management Service Class and who is a member of an

16  existing retirement system or the Special Risk or Special Risk

17  Administrative Support Classes of the Florida Retirement

18  System may elect to remain in such system or class in lieu of

19  participation in the Senior Management Service Class or

20  optional annuity program. Such election shall be made in

21  writing and filed with the board department and the personnel

22  officer of the employer within 90 days of such appointment.

23  Any eligible employee who fails to make an election to

24  participate in the existing system, the Special Risk Class of

25  the Florida Retirement System, the Special Risk Administrative

26  Support Class of the Florida Retirement System, or the

27  optional annuity program shall be deemed to have elected

28  membership in the Senior Management Service Class.

29         4.  Except as provided in subparagraph 5., an

30  employee's election to participate in the optional annuity

31  program is irrevocable as long as such employee continues to

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 1  be employed in an eligible position and continues to meet the

 2  eligibility requirements set forth in this paragraph.

 3         5.  Effective from July 1, 2002, through September 30,

 4  2002, any active employee in a regularly established position

 5  who has elected to participate in the Senior Management

 6  Service Optional Annuity Program has one opportunity to choose

 7  to move from the Senior Management Service Optional Annuity

 8  Program to the Florida Retirement System defined benefit

 9  program.

10         a.  The election must be made in writing and must be

11  filed with the department and the personnel officer of the

12  employer before October 1, 2002, or, in the case of an active

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

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

15  election is irrevocable.

16         b.  The employee will receive service credit under the

17  defined benefit program of the Florida Retirement System equal

18  to his or her years of service under the Senior Management

19  Service Optional Annuity Program. The cost for such credit

20  shall be an amount representing the present value of that

21  employee's accumulated benefit obligation for the affected

22  period of service.

23         c.  The employee must transfer the total accumulated

24  employer contributions and earnings on deposit in his or her

25  Senior Management Service Optional Annuity Program account. If

26  the transferred amount is not sufficient to pay the amount

27  due, the employee must pay a sum representing the remainder of

28  the amount due. In no case may the employee retain any

29  employer contributions or earnings thereon from the Senior

30  Management Service Optional Annuity Program account.

31         (d)  Contributions.--

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 1         1.  Through June 30, 2001, each employer shall

 2  contribute on behalf of each participant in the Senior

 3  Management Service Optional Annuity Program an amount equal to

 4  the normal cost portion of the employer retirement

 5  contribution which would be required if the participant were a

 6  Senior Management Service Class member of the Florida

 7  Retirement System defined benefit program, plus the portion of

 8  the contribution rate required in s. 112.363(8) that would

 9  otherwise be assigned to the Retiree Health Insurance Subsidy

10  Trust Fund.  Effective July 1, 2001, each employer shall

11  contribute on behalf of each participant in the optional

12  program an amount equal to 12.49 percent of the participant's

13  gross monthly compensation.  The board department shall deduct

14  an amount approved by the board, pursuant to s. 215.44(4),

15  Legislature to provide for the administration of this program.

16  The payment of the contributions to the optional program which

17  is required by this subparagraph for each participant shall be

18  made by the employer to the board department, which shall

19  forward the contributions to the designated company or

20  companies contracting for payment of benefits for the

21  participant under the program.

22         2.  Each employer shall contribute on behalf of each

23  participant in the Senior Management Service Optional Annuity

24  Program an amount equal to the unfunded actuarial accrued

25  liability portion of the employer contribution which would be

26  required for members of the Senior Management Service Class in

27  the Florida Retirement System.  This contribution shall be

28  paid to the board department for transfer to the Florida

29  Retirement System Trust Fund.

30         3.  An Optional Annuity Program Trust Fund shall be

31  established in the State Treasury and administered by the

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 1  board department to make payments to provider companies on

 2  behalf of the optional annuity program participants, and to

 3  transfer the unfunded liability portion of the state optional

 4  annuity program contributions to the Florida Retirement System

 5  Trust Fund.

 6         4.  Contributions required for social security by each

 7  employer and each participant, in the amount required for

 8  social security coverage as now or hereafter may be provided

 9  by the federal Social Security Act shall be maintained for

10  each participant in the Senior Management Service retirement

11  program and shall be in addition to the retirement

12  contributions specified in this paragraph.

13         5.  Each participant in the Senior Management Service

14  Optional Annuity Program may contribute by way of salary

15  reduction or deduction a percentage amount of the

16  participant's gross compensation not to exceed the percentage

17  amount contributed by the employer to the optional annuity

18  program. Payment of the participant's contributions shall be

19  made by the employer to the board department, which shall

20  forward the contributions to the designated company or

21  companies contracting for payment of benefits for the

22  participant under the program.

23         (f)  Administration.--

24         1.  The Senior Management Service Optional Annuity

25  Program authorized by this section shall be administered by

26  the board department.  The board department shall designate

27  one or more provider companies from which annuity contracts

28  may be purchased under the program and shall approve the form

29  and content of the contracts. The board department shall sign

30  a contract with each of the provider companies and shall

31  evaluate the performance of the provider companies on a

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 1  continuing basis. The board department may terminate the

 2  services of a provider company for reasons stated in the

 3  contract. The board department shall adopt rules establishing

 4  its responsibilities and the responsibilities of employers in

 5  administering the optional annuity program.

 6         2.  Effective July 1, 1997, the State Board of

 7  Administration shall review and make recommendations to the

 8  department on the acceptability of all investment products

 9  proposed by provider companies of the optional annuity program

10  before such products are offered through annuity contracts to

11  the participants and may advise the department of any changes

12  deemed necessary to ensure that the optional annuity program

13  offers an acceptable mix of investment products. The board

14  department shall determine which make the final determination

15  as to whether an investment products product will be included

16  in approved for the program.

17         3.  The provisions of each contract applicable to a

18  participant in the Senior Management Service Optional Annuity

19  Program shall be contained in a written program description

20  which shall include a report of pertinent financial and

21  actuarial information on the solvency and actuarial soundness

22  of the program and the benefits applicable to the participant.

23  Such description shall be furnished by the company or

24  companies to each participant in the program and to the board

25  department upon commencement of participation in the program

26  and annually thereafter.

27         4.  The board department shall ensure that each

28  participant in the Senior Management Service Optional Annuity

29  Program is provided an accounting of the total contribution

30  and the annual contribution made by and on behalf of such

31  participants.

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 1         Section 22.  Paragraph (h) of subsection (1) and

 2  paragraph (e) of subsection (2) of section 121.081, Florida

 3  Statutes, are amended to read:

 4         121.081  Past service; prior service;

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

 6  service may be claimed and credited are:

 7         (1)

 8         (h)  The following provisions apply to the purchase of

 9  past service:

10         1.  Notwithstanding any of the provisions of this

11  subsection, past-service credit may not be purchased under

12  this chapter for any service that is used to obtain a benefit

13  from any local retirement system.

14         2.  A member may not receive past service credit under

15  paragraphs (a), (b), (e), or (f) for any leaves of absence

16  without pay, except that credit for active military service

17  leaves of absence may be claimed under paragraphs (a), (b),

18  and (f), in accordance with s. 121.111(1).

19         3.  If a member does not desire to receive credit for

20  all of his or her past service, the period the member claims

21  must be the most recent past service prior to his or her

22  participation in the Florida Retirement System.

23         4.  The cost of past service purchased by an employing

24  agency for its employees may be amortized over such period of

25  time as is provided in the agreement, but not to exceed 15

26  years, calculated in accordance with rule 60S-1.007(5)(f),

27  Florida Administrative Code.

28         5.  The retirement account of each member for whom past

29  service is being provided by his or her employer shall be

30  credited with all past service the employer agrees to purchase

31  

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 1  as soon as the agreement between the employer and the division

 2  department is executed. Pursuant thereto:

 3         a.  Each such member's account shall also be posted

 4  with the total contribution his or her employer agrees to make

 5  in the member's behalf for past service earned prior to

 6  October 1, 1975, excluding those contributions representing

 7  the employer's matching share and the compound interest

 8  calculation on the total contribution. However, a portion of

 9  any contributions paid by an employer for past service credit

10  earned on and after October 1, 1975, may not be posted to a

11  member's account.

12         b.  A refund of contributions payable after an employer

13  has made a written agreement to purchase past service for

14  employees of the covered group shall include contributions for

15  past service which are posted to a member's account. However,

16  contributions for past service earned on and after October 1,

17  1975, are not refundable.

18         (2)  Prior service, as defined in s. 121.021(19), may

19  be claimed as creditable service under the Florida Retirement

20  System after a member has been reemployed for 1 complete year

21  of creditable service within a period of 12 consecutive

22  months, except as provided in paragraph (c). Service performed

23  as a participant of the optional retirement program for the

24  State University System under s. 121.35 or the Senior

25  Management Service Optional Annuity Program under s. 121.055

26  may be used to satisfy the reemployment requirement of 1

27  complete year of creditable service. The member shall not be

28  permitted to make any contributions for prior service until

29  after completion of the 1 year of creditable service. If a

30  member does not wish to claim credit for all of his or her

31  prior service, the service the member claims must be the most

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 1  recent period of service. The required contributions for

 2  claiming the various types of prior service are:

 3         (e)  For service performed under the Florida Retirement

 4  System after December 1, 1970, that was never reported to the

 5  division or the department due to error, retirement credit may

 6  be claimed by a member of the Florida Retirement System. The

 7  division department shall adopt rules establishing criteria

 8  for claiming such credit and detailing the documentation

 9  required to substantiate the error.

10         Section 23.  Subsection (1) of section 121.085, Florida

11  Statutes, is amended to read:

12         121.085  Creditable service.--The following provisions

13  shall apply to creditable service as defined in s.

14  121.021(17):

15         (1)  The division department shall adopt rules

16  establishing procedures for the submission of evidence or

17  information necessary to establish a member's claim of

18  creditable service.

19         Section 24.  Section 121.091, Florida Statutes, is

20  amended to read:

21         121.091  Benefits payable under the system.--Benefits

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

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

24  begun participation in the Deferred Retirement Option Program

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

26  been filed in the manner prescribed by the division

27  department. The division department may cancel an application

28  for retirement benefits when the member or beneficiary fails

29  to timely provide the information and documents required by

30  this chapter and the division's department's rules. The

31  division department shall adopt rules establishing procedures

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 1  for application for retirement benefits and for the

 2  cancellation of such application when the required information

 3  or documents are not received.

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

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

 6  the administrator, shall receive a monthly benefit which shall

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

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

 9  thereafter during his or her lifetime. The normal retirement

10  benefit, including any past or additional retirement credit,

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

12  The amount of monthly benefit shall be calculated as the

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

14  applicable, as set forth below:

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

16  is 1.60 percent of the member's average final compensation, up

17  to the member's normal retirement date. Upon completion of the

18  first year after the normal retirement date, A is 1.63 percent

19  of the member's average final compensation.  Following the

20  second year after the normal retirement date, A is 1.65

21  percent of the member's average final compensation. Following

22  the third year after the normal retirement date, and for

23  subsequent years, A is 1.68 percent of the member's average

24  final compensation.

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

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

27  compensation for all creditable years prior to October 1,

28  1974;

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

30  compensation for all creditable years after September 30,

31  1974, and before October 1, 1978;

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

 2  compensation for all creditable years after September 30,

 3  1978, and before January 1, 1989;

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

 5  monthly compensation for all creditable years after December

 6  31, 1988, and before January 1, 1990;

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

 8  final compensation for all creditable years after December 31,

 9  1989, and before January 1, 1991;

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

11  final compensation for all creditable years after December 31,

12  1990, and before January 1, 1992;

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

14  average final compensation for all creditable years after

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

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

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

18  and

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

20  compensation for all creditable years of service after

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

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

23  member of the Special Risk Administrative Support Class

24  entitled to retain the special risk normal retirement date who

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

26  and who retires after July 1, 2000.

27         3.  For creditable years of Senior Management Service

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

29         4.  For creditable years of Elected Officers' Class

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

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

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

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

 3  average final compensation;

 4         (b)  B is the number of the member's years and any

 5  fractional part of a year of creditable service earned

 6  subsequent to November 30, 1970; and

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

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

 9  existing system.  Such normal retirement benefit credit shall

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

11  percentage of average final compensation which the member

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

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

14  in accordance with the existing system under which the member

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

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

17  member of an existing retirement system who is eligible to

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

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

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

21  service.

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

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

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

25         (2)  BENEFITS PAYABLE FOR DUAL NORMAL RETIREMENT

26  AGES.--If a member accumulates retirement benefits to commence

27  at different normal retirement ages by virtue of having

28  performed duties for an employer which would entitle him or

29  her to benefits as both a member of the Special Risk Class and

30  a member of either the Regular Class, Senior Management

31  Service Class, or Elected Officers' Class, the amount of

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 1  benefits payable shall be computed separately with respect to

 2  each such age and the sum of such computed amounts shall be

 3  paid as provided in this section.

 4         (3)  EARLY RETIREMENT BENEFIT.--Upon retirement on his

 5  or her early retirement date, the member shall receive an

 6  immediate monthly benefit that shall begin to accrue on the

 7  first day of the month of the retirement date and be payable

 8  on the last day of that month and each month thereafter during

 9  his or her lifetime.  Such benefit shall be calculated as

10  follows:

11         (a)  The amount of each monthly payment shall be

12  computed in the same manner as for a normal retirement

13  benefit, in accordance with subsection (1), but shall be based

14  on the member's average monthly compensation and creditable

15  service as of the member's early retirement date.  The benefit

16  so computed shall be reduced by five-twelfths of 1 percent for

17  each complete month by which the early retirement date

18  precedes the normal retirement date of age 62 for a member of

19  the Regular Class, Senior Management Service Class, or the

20  Elected Officers' Class, and age 55 for a member of the

21  Special Risk Class, or age 52 if a Special Risk member has

22  completed 25 years of creditable service in accordance with s.

23  121.021(29)(b)3.

24         (b)  If the employment of a member is terminated by

25  reason of death subsequent to the completion of 20 years of

26  creditable service, the monthly benefit payable to the

27  member's beneficiary shall be calculated in accordance with

28  subsection (1), but shall be based on average monthly

29  compensation and creditable service as of the date of death.

30  The benefit so computed shall be reduced by five-twelfths of 1

31  percent for each complete month by which death precedes the

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 1  normal retirement date specified above or the date on which

 2  the member would have attained 30 years of creditable service

 3  had he or she survived and continued his or her employment,

 4  whichever provides a higher benefit.

 5         (4)  DISABILITY RETIREMENT BENEFIT.--

 6         (a)  Disability retirement; entitlement and effective

 7  date.--

 8         1.a.  A member who becomes totally and permanently

 9  disabled, as defined in paragraph (b), after completing 5

10  years of creditable service, or a member who becomes totally

11  and permanently disabled in the line of duty regardless of

12  service, shall be entitled to a monthly disability benefit;

13  except that any member with less than 5 years of creditable

14  service on July 1, 1980, or any person who becomes a member of

15  the Florida Retirement System on or after such date must have

16  completed 10 years of creditable service prior to becoming

17  totally and permanently disabled in order to receive

18  disability retirement benefits for any disability which occurs

19  other than in the line of duty. However, if a member employed

20  on July 1, 1980, with less than 5 years of creditable service

21  as of that date, becomes totally and permanently disabled

22  after completing 5 years of creditable service and is found

23  not to have attained fully insured status for benefits under

24  the federal Social Security Act, such member shall be entitled

25  to a monthly disability benefit.

26         b.  Effective July 1, 2001, a member of the defined

27  benefit retirement program who becomes totally and permanently

28  disabled, as defined in paragraph (b), after completing 8

29  years of creditable service, or a member who becomes totally

30  and permanently disabled in the line of duty regardless of

31  service, shall be entitled to a monthly disability benefit.

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 1         2.  If the division has received from the employer the

 2  required documentation of the member's termination of

 3  employment, the effective retirement date for a member who

 4  applies and is approved for disability retirement shall be

 5  established by rule of the division.

 6         3.  For a member who is receiving Workers' Compensation

 7  payments, the effective disability retirement date may not

 8  precede the date the member reaches Maximum Medical

 9  Improvement (MMI), unless the member terminates employment

10  prior to reaching MMI.

11         (b)  Total and permanent disability.--A member shall be

12  considered totally and permanently disabled if, in the opinion

13  of the administrator, he or she is prevented, by reason of a

14  medically determinable physical or mental impairment, from

15  rendering useful and efficient service as an officer or

16  employee.

17         (c)  Proof of disability.--The administrator, before

18  approving payment of any disability retirement benefit, shall

19  require proof that the member is totally and permanently

20  disabled as provided herein:

21         1.  Such proof shall include the certification of the

22  member's total and permanent disability by two licensed

23  physicians of the state and such other evidence of disability

24  as the administrator may require, including reports from

25  vocational rehabilitation, evaluation, or testing specialists

26  who have evaluated the applicant for employment.

27         2.  It must be documented that:

28         a.  The member's medical condition occurred or became

29  symptomatic during the time the member was employed in an

30  employee/employer relationship with his or her employer;

31  

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 1         b.  The member was totally and permanently disabled at

 2  the time he or she terminated covered employment; and

 3         c.  The member has not been employed with any other

 4  employer after such termination.

 5         3.  If the application is for in-line-of-duty

 6  disability, in addition to the requirements of subparagraph

 7  2., it must be documented by competent medical evidence that

 8  the disability was caused by a job-related illness or accident

 9  which occurred while the member was in an employee/employer

10  relationship with his or her employer.

11         4.  The unavailability of an employment position that

12  the member is physically and mentally capable of performing

13  will not be considered as proof of total and permanent

14  disability.

15         (d)  Election on appeal.--A member whose application

16  for regular disability retirement has been denied and who has

17  filed an appeal to the State Retirement Commission may, if

18  eligible, elect to receive normal or early service retirement

19  benefits while he or she is awaiting the decision on the

20  appeal. However:

21         1.  If the member elects to receive service retirement

22  benefits and disability benefits are later approved as a

23  result of the appeal, the payment option chosen by the member

24  may not be changed.

25         2.  If the member elects to receive early service

26  retirement and the appeal is later denied, the member may not

27  change his or her election of early retirement.

28  

29  Before such regular or early retirement benefits may be paid

30  by the division, the member must provide to the division a

31  written statement indicating that the member understands that

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 1  such changes are not permitted after he or she begins

 2  receiving the benefits.

 3         (e)  Disability retirement benefit.--Upon the

 4  retirement of a member on his or her disability retirement

 5  date, the member shall receive a monthly benefit that shall

 6  begin to accrue on the first day of the month of disability

 7  retirement and shall be payable on the last day of that month

 8  and each month thereafter during his or her lifetime and

 9  continued disability.

10         (f)  Computation of disability retirement benefit.--The

11  amount of each monthly payment shall be computed in the same

12  manner as for a normal retirement benefit, in accordance with

13  subsection (1), but shall be based on disability option

14  actuarial equivalency tables and the average monthly

15  compensation and creditable service of the member as of the

16  disability retirement date, subject to the following

17  conditions:

18         1.  If the member's disability occurred in the line of

19  duty, the monthly Option 1 benefit shall not be less than:

20         a.  Forty-two percent of average monthly compensation

21  as of the disability retirement date; or

22         b.  Sixty-five percent of the average monthly

23  compensation as of the disability retirement date for a member

24  of the special risk class who retires on or after July 1,

25  2000; or

26         2.  If the member's disability occurred other than in

27  the line of duty, the monthly Option 1 benefit shall not be

28  less than 25 percent of average monthly compensation as of the

29  disability retirement date.

30         (g)  Reapplication.--A member, whose initial

31  application for disability retirement has been denied, may

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 1  reapply for disability benefits. However, such member's

 2  reapplication will be considered only if the member presents

 3  new medical evidence of a medical condition that existed prior

 4  to the member's termination of employment. The division may

 5  prescribe by rule procedures for reapplication and for review

 6  and approval or disapproval of reapplication.

 7         (h)  Recovery from disability.--The administrator may

 8  require periodic reexaminations at the expense of the

 9  retirement fund. The division may adopt rules establishing

10  procedures for conducting and review of such reexaminations.

11         1.  If the administrator finds that a member who is

12  receiving disability benefits is, at any time prior to his or

13  her normal retirement date, no longer disabled, the

14  administrator shall direct that the benefits be discontinued.

15  The decision of the administrator on this question shall be

16  final and binding. If such member:

17         a.  Does not reenter the employ of an employer and was

18  not vested as of the disability retirement date, he or she

19  shall be entitled to the excess, if any, of his or her

20  accumulated contributions over the total disability benefits

21  received up to the date of recovery.

22         b.  Does not reenter the employ of an employer, but was

23  vested as of the disability retirement date, he or she may

24  elect to receive:

25         (I)  The excess, if any, of his or her accumulated

26  contributions over the total disability benefits received up

27  to the date of recovery; or

28         (II)  A deferred benefit commencing on the last day of

29  the month of the normal retirement date which shall be payable

30  on the last day of the month thereafter during his or her

31  lifetime.  The amount of such monthly benefit shall be

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 1  computed in the same manner as for a normal retirement

 2  benefit, in accordance with subsection (1), but shall be based

 3  on average monthly compensation and creditable service as of

 4  the member's disability retirement date.

 5         c.  Reenters employment of an employer within 6 months

 6  after recovery, the member's service will be deemed to have

 7  been continuous, but the period beginning with the first month

 8  for which he or she received a disability benefit payment and

 9  ending with the date he or she reentered employment will not

10  be considered as creditable service for the purpose of

11  computing benefits except as provided in sub-subparagraph d.

12  As used in this section, the term "accumulated contributions"

13  for such member means the excess of the member's accumulated

14  contributions as of the disability retirement date over the

15  total disability benefits received under paragraph (e).

16         d.  Terminates his or her disability benefit, reenters

17  covered employment, and is continuously employed for a minimum

18  of 1 year of creditable service, he or she may claim as

19  creditable service the months during which he or she was

20  receiving a disability benefit, upon payment of the required

21  contributions.  Contributions shall equal the total required

22  employee and employer contribution rate applicable during the

23  period the retiree received retirement benefits, multiplied

24  times his or her rate of monthly compensation prior to the

25  commencement of disability retirement for each month of the

26  period claimed, plus 4 percent interest until July 1, 1975,

27  and 6.5 percent interest thereafter, compounded annually each

28  June 30 to the date of payment. If the member does not claim

29  credit for all of the months he or she received disability

30  benefits, the months claimed must be the most recent months of

31  retirement. Such credit for periods of disability, when

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 1  purchased under the Florida Retirement System, shall apply

 2  toward vesting requirements for eligibility to purchase

 3  additional credit for other service.

 4         2.  Both the member receiving disability benefits who

 5  reenters employment and the employer employing such disability

 6  retiree shall notify the division immediately upon

 7  reemployment, and the division shall terminate such member's

 8  disability benefits, effective the first day of the month

 9  following the month in which notification of recovery is

10  received. If the member is reemployed with a Florida

11  Retirement System employer at the time of benefit termination,

12  and he or she has received disability retirement benefit and

13  salary payments concurrently prior to notifying the division,

14  he or she may elect within 30 days to:

15         a.  Retain the retirement benefits received prior to

16  termination of disability benefits and begin receiving

17  retirement service credit effective upon the date of

18  termination of benefits; or

19         b.  Repay, within 12 months after his or her decision

20  to receive service credit, the retirement benefits received

21  for each month of reemployment prior to termination of

22  disability benefits and begin receiving retirement service

23  credit effective upon the date of reemployment. Any such

24  unpaid benefits shall have compound interest of 6.5 percent

25  added June 30.

26  

27  A member may not receive both retirement service credit for

28  employment and retirement benefits for the same month.

29         3.  If, after recovery of disability and reentry into

30  covered employment, the member again becomes disabled and is

31  again approved for disability retirement, the Option 1 monthly

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 1  retirement benefit shall not be less than the Option 1 monthly

 2  benefit calculated at the time of the previous disability,

 3  plus any cost of living increases up to the time the

 4  disability benefit was terminated upon his or her reentry into

 5  covered employment.

 6         (i)  Nonadmissible causes of disability.--A member

 7  shall not be entitled to receive any disability retirement

 8  benefit if the disability is a result of any of the following:

 9         1.  Injury or disease sustained by the member while

10  willfully participating in a riot, civil insurrection, or

11  other act of violence or while committing a felony;

12         2.  Injury or disease sustained by the member after his

13  or her employment has terminated; or

14         3.  Intentional, self-inflicted injury.

15         (j)  Disability retirement of justice or judge by order

16  of Supreme Court.--

17         1.  If a member is a justice of the Supreme Court,

18  judge of a district court of appeal, circuit judge, or judge

19  of a county court who has served for 6 years or more as an

20  elected constitutional judicial officer, including service as

21  a judicial officer in any court abolished pursuant to Art. V

22  of the State Constitution, and who is retired for disability

23  by order of the Supreme Court upon recommendation of the

24  Judicial Qualifications Commission pursuant to the provisions

25  of Art. V of the State Constitution, the member's Option 1

26  monthly benefit as provided in subparagraph (6)(a)1. shall not

27  be less than two-thirds of his or her monthly compensation as

28  of the member's disability retirement date. Such a member may

29  alternatively elect to receive a disability retirement benefit

30  under any other option as provided in paragraph (6)(a).

31  

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 1         2.  Should any justice or judge who is a member of the

 2  Florida Retirement System be retired for disability by order

 3  of the Supreme Court upon recommendation of the Judicial

 4  Qualifications Commission pursuant to the provisions of Art. V

 5  of the State Constitution, then all contributions to his or

 6  her account and all contributions made on his or her behalf by

 7  the employer shall be transferred to and deposited in the

 8  General Revenue Fund of the state, and there is hereby

 9  appropriated annually out of the General Revenue Fund, to be

10  paid into the Florida Retirement System Fund, an amount

11  necessary to pay the benefits of all justices and judges

12  retired from the Florida retirement System pursuant to Art. V

13  of the State Constitution.

14         (5)  TERMINATION BENEFITS.--A member whose employment

15  is terminated prior to retirement retains membership rights to

16  previously earned member-noncontributory service credit, and

17  to member-contributory service credit, if the member leaves

18  the member contributions on deposit in his or her retirement

19  account. If a terminated member receives a refund of member

20  contributions, such member may reinstate membership rights to

21  the previously earned service credit represented by the refund

22  by completing 1 year of creditable service and repaying the

23  refunded member contributions, plus interest.

24         (a)  A member whose employment is terminated for any

25  reason other than death or retirement prior to becoming vested

26  is entitled to the return of his or her accumulated

27  contributions as of the date of termination.

28         (b)  A member whose employment is terminated for any

29  reason other than death or retirement after becoming vested

30  may elect to receive a deferred monthly benefit which shall

31  begin to accrue on the first day of the month of normal or

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 1  early retirement and shall be payable on the last day of that

 2  month and each month thereafter during his or her lifetime.

 3  The amount of monthly benefit shall be computed in the same

 4  manner as for a normal retirement benefit in accordance with

 5  subsection (1) or early retirement benefit in accordance with

 6  s. 121.021(30), but based on average monthly compensation and

 7  creditable service as of the date of termination.

 8         (c)  In lieu of the deferred monthly benefit provided

 9  in paragraph (b), the terminated member may elect to receive a

10  lump-sum amount equal to his or her accumulated contributions

11  as of the date of termination.

12         (d)  If any retired member dies without having received

13  in benefit payments an amount equal to his or her accumulated

14  contributions, there shall be payable to his or her designated

15  beneficiary an amount equal to the excess, if any, of the

16  member's accumulated contributions over the total monthly

17  payments made to the member prior to the date of death.

18         (e)  A member shall be deemed a terminated member when

19  termination of employment has occurred as provided in s.

20  121.021(39).

21         (f)  Any member who has been found guilty by a verdict

22  of a jury, or by the court trying the case without a jury, of

23  committing, aiding, or abetting any embezzlement or theft from

24  his or her employer, bribery in connection with the

25  employment, or other felony specified in chapter 838, except

26  ss. 838.15 and 838.16, committed prior to retirement, or who

27  has entered a plea of guilty or of nolo contendere to such

28  crime, or any member whose employment is terminated by reason

29  of the member's admitted commitment, aiding, or abetting of an

30  embezzlement or theft from his or her employer, bribery, or

31  other felony specified in chapter 838, except ss. 838.15 and

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 1  838.16, shall forfeit all rights and benefits under this

 2  chapter, except the return of his or her accumulated

 3  contributions as of the date of termination.

 4         (g)  Any elected official who is convicted by the

 5  Senate of an impeachable offense shall forfeit all rights and

 6  benefits under this chapter, except the return of his or her

 7  accumulated contributions as of the date of the conviction.

 8         (h)  Any member who, prior to retirement, is adjudged

 9  by a court of competent jurisdiction to have violated any

10  state law against strikes by public employees, or who has been

11  found guilty by such court of violating any state law

12  prohibiting strikes by public employees, shall forfeit all

13  rights and benefits under this chapter, except the return of

14  his or her accumulated contributions as of the date of the

15  conviction.

16         (i)  Any beneficiary who by a verdict of a jury or by

17  the court trying the case without a jury is found guilty, or

18  who has entered a plea of guilty or nolo contendere, of

19  unlawfully and intentionally killing or procuring the death of

20  the member forfeits all rights to the deceased member's

21  benefits under this chapter, and the benefits will be paid as

22  if such beneficiary had predeceased the decedent.

23         (j)  Benefits shall not be paid by the division pending

24  final resolution of such charges against a member or

25  beneficiary if the resolution of such charges could require

26  the forfeiture of benefits as provided in paragraph (f),

27  paragraph (g), paragraph (h), or paragraph (i).

28         (6)  OPTIONAL FORMS OF RETIREMENT BENEFITS AND

29  DISABILITY RETIREMENT BENEFITS.--

30         (a)  Prior to the receipt of the first monthly

31  retirement payment, a member shall elect to receive the

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 1  retirement benefits to which he or she is entitled under

 2  subsection (1), subsection (2), subsection (3), or subsection

 3  (4) in accordance with one of the following options:

 4         1.  The maximum retirement benefit payable to the

 5  member during his or her lifetime.

 6         2.  A decreased retirement benefit payable to the

 7  member during his or her lifetime and, in the event of his or

 8  her death within a period of 10 years after retirement, the

 9  same monthly amount payable for the balance of such 10-year

10  period to his or her beneficiary or, in case the beneficiary

11  is deceased, in accordance with subsection (8) as though no

12  beneficiary had been named.

13         3.  A decreased retirement benefit payable during the

14  joint lifetime of both the member and his or her joint

15  annuitant and which, after the death of either, shall continue

16  during the lifetime of the survivor in the same amount,

17  subject to the provisions of subsection (12).

18         4.  A decreased retirement benefit payable during the

19  joint lifetime of the member and his or her joint annuitant

20  and which, after the death of either, shall continue during

21  the lifetime of the survivor in an amount equal to 66 2/3

22  percent of the amount that was payable during the joint

23  lifetime of the member and his or her joint annuitant, subject

24  to the provisions of subsection (12).

25  

26  The spouse of any member who elects to receive the benefit

27  provided under subparagraph 1. or subparagraph 2. shall be

28  notified of and shall acknowledge any such election. The

29  division shall establish by rule a method for selecting the

30  appropriate actuarial factor for optional forms of benefits

31  

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 1  selected under subparagraphs 3. and 4., based on the age of

 2  the member and the joint annuitant.

 3         (b)  The benefit payable under any option stated above

 4  shall be the actuarial equivalent, based on tables adopted by

 5  the administrator for this purpose, of the amount to which the

 6  member was otherwise entitled.

 7         (c)  A member who elects the option in subparagraph

 8  (a)2. shall, in accordance with subsection (8), designate one

 9  or more persons to receive the benefits payable in the event

10  of his or her death. Such persons shall be the beneficiaries

11  of the member.  The member may also designate one or more

12  contingent beneficiaries to receive any benefits remaining

13  upon the death of the primary beneficiary.

14         (d)  A member who elects the option in subparagraph

15  (a)3. or subparagraph (a)4. shall, on a form provided for that

16  purpose, designate a joint annuitant to receive the benefits

17  which continue to be payable upon the death of the member.

18  After benefits have commenced under the option in subparagraph

19  (a)3. or subparagraph (a)4., the following shall apply:

20         1.  A retired member may change his or her designation

21  of a joint annuitant only twice.  If such a retired member

22  desires to change his or her designation of a joint annuitant,

23  he or she shall file with the division a notarized "change of

24  joint annuitant" form and shall notify the former joint

25  annuitant in writing of such change. Effective the first day

26  of the next month following receipt by the division of a

27  completed change of joint annuitant form, the division shall

28  adjust the member's monthly benefit by the application of

29  actuarial tables and calculations developed to ensure that the

30  benefit paid is the actuarial equivalent of the present value

31  of the member's current benefit.  The consent of a retired

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 1  member's first designated joint annuitant to any such change

 2  shall not be required. However, if either the member or the

 3  joint annuitant dies before the effective date of the request

 4  for change of joint annuitant, the requested change shall be

 5  void, and survivor benefits, if any, shall be paid as if no

 6  request had been made.

 7         2.  In the event of the dissolution of marriage of a

 8  retired member and a joint annuitant, such member may make an

 9  election to nullify the joint annuitant designation of the

10  former spouse, unless there is an existing qualified domestic

11  relations order preventing such action.  The member shall file

12  with the division a written, notarized nullification which

13  shall be effective on the first day of the next month

14  following receipt by the division.  Benefits shall be paid as

15  if the former spouse predeceased the member.  A member who

16  makes such an election may not reverse the nullification but

17  may designate a new joint annuitant in accordance with

18  subparagraph 1.

19         (e)  The election of an option shall be null and void

20  if the member dies before the effective date of retirement.

21         (f)  A member who elects to receive benefits under the

22  option in subparagraph (a)3. may designate one or more

23  qualified persons, either a spouse or other dependent, as his

24  or her joint annuitant to receive the benefits after the

25  member's death in whatever proportion he or she so assigns to

26  each person named as joint annuitant. The division shall adopt

27  appropriate actuarial tables and calculations necessary to

28  ensure that the benefit paid is the actuarial equivalent of

29  the benefit to which the member is otherwise entitled under

30  the option in subparagraph (a)1.

31  

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 1         (g)  Upon the death of a retired member or beneficiary

 2  receiving monthly benefits under this chapter, the monthly

 3  benefits shall be paid through the last day of the month of

 4  death and shall terminate, or be adjusted, if applicable, as

 5  of that date in accordance with the optional form of benefit

 6  selected at the time of retirement.

 7         (h)  The option selected or determined for payment of

 8  benefits as provided in this section shall be final and

 9  irrevocable at the time a benefit payment is cashed or

10  deposited or credited to the Deferred Retirement Option

11  Program as provided in subsection (13).

12         (7)  DEATH BENEFITS.--

13         (a)  If the employment of a member is terminated by

14  reason of his or her death prior to being vested, except as

15  provided in paragraph (f), there shall be payable to his or

16  her designated beneficiary the member's accumulated

17  contributions.

18         (b)  If the employment of an active member who may or

19  may not have applied for retirement is terminated by reason of

20  his or her death subsequent to becoming vested and prior to

21  his or her effective date of retirement, if established, it

22  shall be assumed that the member retired as of the date of

23  death in accordance with subsection (1) if eligible for normal

24  retirement benefits, subsection (2) if eligible for benefits

25  payable for dual normal retirement, or subsection (3) if

26  eligible for early retirement benefits. Benefits payable to

27  the designated beneficiary shall be as follows:

28         1.  For a beneficiary who qualifies as a joint

29  annuitant, the optional form of payment provided in accordance

30  with subparagraph (6)(a)3. shall be paid for the joint

31  annuitant's lifetime.

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 1         2.  For a beneficiary who does not qualify as a joint

 2  annuitant, no continuing monthly benefit shall be paid and the

 3  beneficiary shall be entitled only to the return of the

 4  member's personal contributions. If there is no monetary

 5  interest in the member's retirement account for which such

 6  beneficiary is eligible, the beneficiary shall be the next

 7  named beneficiary or, if no other beneficiary is named, the

 8  beneficiary shall be the next eligible beneficiary according

 9  to subsection (8).

10         (c)  If a retiring member dies on or after the

11  effective date of retirement, but prior to a benefit payment

12  being cashed or deposited, or credited to the Deferred

13  Retirement Option Program, benefits shall be paid as follows:

14         1.  For a designated beneficiary who qualifies as a

15  joint annuitant, benefits shall be paid in the optional form

16  of payment provided in subparagraph (6)(a)3. for the joint

17  annuitant's lifetime or, if the member chose the optional form

18  of payment provided in subparagraph (6)(a)2., the joint

19  annuitant may select the form provided in either subparagraph

20  (6)(a)2. or subparagraph (6)(a)3.

21         2.  For a designated beneficiary who does not qualify

22  as a joint annuitant, any benefits payable shall be paid as

23  provided in the option selected by the member; or if the

24  member has not selected an option, benefits shall be paid in

25  the optional form of payment provided in subparagraph (6)(a)1.

26         (d)  Notwithstanding any other provision in this

27  chapter to the contrary, with the exception of the Deferred

28  Retirement Option Program, as provided in subsection (13):

29         1.  The surviving spouse of any member killed in the

30  line of duty may receive a monthly pension equal to one-half

31  of the monthly salary being received by the member at the time

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 1  of death for the rest of the surviving spouse's lifetime or,

 2  if the member was vested, such surviving spouse may elect to

 3  receive a benefit as provided in paragraph (b). Benefits

 4  provided by this paragraph shall supersede any other

 5  distribution that may have been provided by the member's

 6  designation of beneficiary.

 7         2.  If the surviving spouse of a member killed in the

 8  line of duty dies, the monthly payments which would have been

 9  payable to such surviving spouse had such surviving spouse

10  lived shall be paid for the use and benefit of such member's

11  child or children under 18 years of age and unmarried until

12  the 18th birthday of the member's youngest child.

13         3.  If a member killed in the line of duty leaves no

14  surviving spouse but is survived by a child or children under

15  18 years of age, the benefits provided by subparagraph 1.,

16  normally payable to a surviving spouse, shall be paid for the

17  use and benefit of such member's child or children under 18

18  years of age and unmarried until the 18th birthday of the

19  member's youngest child.

20         4.  The surviving spouse of a member whose benefit

21  terminated because of remarriage shall have the benefit

22  reinstated beginning July 1, 1993, at an amount that would

23  have been payable had the benefit not been terminated.

24         (e)  The surviving spouse or other dependent of any

25  member, except a member who participated in the Deferred

26  Retirement Option Program, whose employment is terminated by

27  death shall, upon application to the administrator, be

28  permitted to pay the required contributions for any service

29  performed by the member which could have been claimed by the

30  member at the time of his or her death.  Such service shall be

31  added to the creditable service of the member and shall be

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 1  used in the calculation of any benefits which may be payable

 2  to the surviving spouse or other surviving dependent.

 3         (f)  Notwithstanding any other provisions in this

 4  chapter to the contrary and upon application to the

 5  administrator, an eligible joint annuitant, of a member whose

 6  employment is terminated by death within 1 year of such member

 7  satisfying the service requirements for vesting and retirement

 8  eligibility, shall be permitted to purchase only the

 9  additional service credit necessary to vest and qualify for

10  retirement benefits, not to exceed a total of 1 year of

11  credit, by one or a combination of the following methods:

12         1.  Such eligible joint annuitant may use the deceased

13  member's accumulated hours of annual, sick, and compensatory

14  leave to purchase additional creditable service, on an hour by

15  hour basis, provided that such deceased member's accumulated

16  leave is sufficient to cover the additional months required.

17  For each month of service credit needed prior to the final

18  month, credit for the total number of work hours in that month

19  must be purchased, using an equal number of the deceased

20  member's accumulated leave hours.  Service credit required for

21  the final month in which the deceased member would have become

22  vested shall be awarded upon the purchase of 1 hour of credit.

23  Such eligible joint annuitant shall pay the contribution rate

24  in effect for the period of time being claimed for the

25  deceased member's class of membership, multiplied by such

26  member's monthly salary at the time of death, plus 6.5 percent

27  interest compounded annually.  The accumulated leave payment

28  used in the average final compensation shall not include that

29  portion of the payment that represents any leave hours used in

30  the purchase of such creditable service.

31  

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 1         2.  Such eligible joint annuitant may purchase

 2  additional months of creditable service for any periods of

 3  out-of-state service as provided in s. 121.1115, and in-state

 4  service as provided in s. 121.1122, that the deceased member

 5  would have been eligible to purchase prior to his or her

 6  death.

 7  

 8  Service purchased under this paragraph shall be added to the

 9  creditable service of the member and used to vest for

10  retirement eligibility, and shall be used in the calculation

11  of any benefits which may be payable to the eligible joint

12  annuitant.  Any benefits paid in accordance with this

13  paragraph shall only be made prospectively.

14         (g)  Notwithstanding any other provisions in this

15  chapter to the contrary, if any member who is vested dies and

16  the surviving spouse receives a refund of the accumulated

17  contributions made to the retirement trust fund, such spouse

18  may pay to the Division of Retirement an amount equal to the

19  sum of the amount of the deceased member's accumulated

20  contributions previously refunded plus interest at 4 percent

21  compounded annually each June 30 from the date of refund until

22  July 1, 1975, and 6.5 percent interest compounded annually

23  thereafter, until full payment is made, and receive the

24  monthly retirement benefit as provided in paragraph (b).

25         (h)  The designated beneficiary who is the surviving

26  spouse or other dependent of a member whose employment is

27  terminated by death subsequent to becoming vested, but prior

28  to actual retirement, may elect to receive a deferred monthly

29  benefit as if the member had lived and had elected a deferred

30  monthly benefit, as provided in paragraph (5)(b), calculated

31  on the basis of the average final compensation and creditable

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 1  service of the member at his or her death and the age the

 2  member would have attained on the commencement date of the

 3  deferred benefit elected by the beneficiary, paid in

 4  accordance with option 3 of paragraph (6)(a).

 5         (8)  DESIGNATION OF BENEFICIARIES.--

 6         (a)  Each member may, on a form provided for that

 7  purpose, signed and filed with the division, designate a

 8  choice of one or more persons, named sequentially or jointly,

 9  as his or her beneficiary who shall receive the benefits, if

10  any, which may be payable in the event of the member's death

11  pursuant to the provisions of this chapter. If no beneficiary

12  is named in the manner provided above, or if no beneficiary

13  designated by the member survives the member, the beneficiary

14  shall be the spouse of the deceased, if living. If the

15  member's spouse is not alive at his or her death, the

16  beneficiary shall be the living children of the member.  If no

17  children survive, the beneficiary shall be the member's father

18  or mother, if living; otherwise, the beneficiary shall be the

19  member's estate.  The beneficiary most recently designated by

20  a member on a form or letter filed with the division shall be

21  the beneficiary entitled to any benefits payable at the time

22  of the member's death, except that benefits shall be paid as

23  provided in paragraph (7)(d) when death occurs in the line of

24  duty. Notwithstanding any other provisions in this subsection

25  to the contrary, for a member who dies prior to his or her

26  effective date of retirement on or after January 1, 1999, the

27  spouse at the time of death shall be the member's beneficiary

28  unless such member designates a different beneficiary as

29  provided herein subsequent to the member's most recent

30  marriage.

31  

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 1         (b)  A designated beneficiary of a retirement account

 2  for whom there is a monetary interest may disclaim his or her

 3  monetary interest as provided in s. 689.21, and in accordance

 4  with division rules governing such disclaimers. Such

 5  disclaimer must be filed within 24 months after the event that

 6  created the interest, that is, the death of the member or

 7  annuitant.

 8         (c)  Notwithstanding the member's designation of

 9  benefits to be paid through a trust to a beneficiary that is a

10  natural person as provided in s. 121.021(46), and

11  notwithstanding the provisions of the trust, benefits shall be

12  paid directly to the beneficiary if such person is no longer a

13  minor or incapacitated as defined in s. 744.102(10) and (11).

14         (9)  EMPLOYMENT AFTER RETIREMENT; LIMITATION.--

15         (a)  Any person who is retired under this chapter,

16  except under the disability retirement provisions of

17  subsection (4), may be employed by an employer that does not

18  participate in a state-administered retirement system and may

19  receive compensation from that employment without limiting or

20  restricting in any way the retirement benefits payable to that

21  person.

22         (b)1.  Any person who is retired under this chapter,

23  except under the disability retirement provisions of

24  subsection (4), may be reemployed by any private or public

25  employer after retirement and receive retirement benefits and

26  compensation from his or her employer without any limitations,

27  except that a person may not receive both a salary from

28  reemployment with any agency participating in the Florida

29  Retirement System and retirement benefits under this chapter

30  for a period of 12 months immediately subsequent to the date

31  of retirement. However, a DROP participant shall continue

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 1  employment and receive a salary during the period of

 2  participation in the Deferred Retirement Option Program, as

 3  provided in subsection (13).

 4         2.  Any person to whom the limitation in subparagraph

 5  1. applies who violates such reemployment limitation and who

 6  is reemployed with any agency participating in the Florida

 7  Retirement System before completion of the 12-month limitation

 8  period shall give timely notice of this fact in writing to the

 9  employer and to the division and shall have his or her

10  retirement benefits suspended for the balance of the 12-month

11  limitation period.  Any person employed in violation of this

12  paragraph and any employing agency which knowingly employs or

13  appoints such person without notifying the Division of

14  Retirement to suspend retirement benefits shall be jointly and

15  severally liable for reimbursement to the retirement trust

16  fund of any benefits paid during the reemployment limitation

17  period.  To avoid liability, such employing agency shall have

18  a written statement from the retiree that he or she is not

19  retired from a state-administered retirement system.  Any

20  retirement benefits received while reemployed during this

21  reemployment limitation period shall be repaid to the

22  retirement trust fund, and retirement benefits shall remain

23  suspended until such repayment has been made.  Benefits

24  suspended beyond the reemployment limitation shall apply

25  toward repayment of benefits received in violation of the

26  reemployment limitation.

27         3.  A district school board may reemploy a retired

28  member as a substitute or hourly teacher, education

29  paraprofessional, transportation assistant, bus driver, or

30  food service worker on a noncontractual basis after he or she

31  has been retired for 1 calendar month, in accordance with s.

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 1  121.021(39). A district school board may reemploy a retired

 2  member as instructional personnel, as defined in s.

 3  1012.01(2)(a), on an annual contractual basis after he or she

 4  has been retired for 1 calendar month, in accordance with s.

 5  121.021(39). Any other retired member who is reemployed within

 6  1 calendar month after retirement shall void his or her

 7  application for retirement benefits. District school boards

 8  reemploying such teachers, education paraprofessionals,

 9  transportation assistants, bus drivers, or food service

10  workers are subject to the retirement contribution required by

11  subparagraph 7.

12         4.  A community college board of trustees may reemploy

13  a retired member as an adjunct instructor, that is, an

14  instructor who is noncontractual and part-time, or as a

15  participant in a phased retirement program within the Florida

16  Community College System, after he or she has been retired for

17  1 calendar month, in accordance with s. 121.021(39).  Any

18  retired member who is reemployed within 1 calendar month after

19  retirement shall void his or her application for retirement

20  benefits.  Boards of trustees reemploying such instructors are

21  subject to the retirement contribution required in

22  subparagraph 7.  A retired member may be reemployed as an

23  adjunct instructor for no more than 780 hours during the first

24  12 months of retirement.  Any retired member reemployed for

25  more than 780 hours during the first 12 months of retirement

26  shall give timely notice in writing to the employer and to the

27  division of the date he or she will exceed the limitation.

28  The division shall suspend his or her retirement benefits for

29  the remainder of the first 12 months of retirement.  Any

30  person employed in violation of this subparagraph and any

31  employing agency which knowingly employs or appoints such

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 1  person without notifying the Division of Retirement to suspend

 2  retirement benefits shall be jointly and severally liable for

 3  reimbursement to the retirement trust fund of any benefits

 4  paid during the reemployment limitation period.  To avoid

 5  liability, such employing agency shall have a written

 6  statement from the retiree that he or she is not retired from

 7  a state-administered retirement system. Any retirement

 8  benefits received by a retired member while reemployed in

 9  excess of 780 hours during the first 12 months of retirement

10  shall be repaid to the Retirement System Trust Fund, and

11  retirement benefits shall remain suspended until repayment is

12  made.  Benefits suspended beyond the end of the retired

13  member's first 12 months of retirement shall apply toward

14  repayment of benefits received in violation of the 780-hour

15  reemployment limitation.

16         5.  The State University System may reemploy a retired

17  member as an adjunct faculty member or as a participant in a

18  phased retirement program within the State University System

19  after the retired member has been retired for 1 calendar

20  month, in accordance with s. 121.021(39).  Any retired member

21  who is reemployed within 1 calendar month after retirement

22  shall void his or her application for retirement benefits.

23  The State University System is subject to the retired

24  contribution required in subparagraph 7., as appropriate. A

25  retired member may be reemployed as an adjunct faculty member

26  or a participant in a phased retirement program for no more

27  than 780 hours during the first 12 months of his or her

28  retirement.  Any retired member reemployed for more than 780

29  hours during the first 12 months of retirement shall give

30  timely notice in writing to the employer and to the division

31  of the date he or she will exceed the limitation.  The

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 1  division shall suspend his or her retirement benefits for the

 2  remainder of the first 12 months of retirement. Any person

 3  employed in violation of this subparagraph and any employing

 4  agency which knowingly employs or appoints such person without

 5  notifying the Division of Retirement to suspend retirement

 6  benefits shall be jointly and severally liable for

 7  reimbursement to the retirement trust fund of any benefits

 8  paid during the reemployment limitation period.  To avoid

 9  liability, such employing agency shall have a written

10  statement from the retiree that he or she is not retired from

11  a state-administered retirement system. Any retirement

12  benefits received by a retired member while reemployed in

13  excess of 780 hours during the first 12 months of retirement

14  shall be repaid to the Retirement System Trust Fund, and

15  retirement benefits shall remain suspended until repayment is

16  made.  Benefits suspended beyond the end of the retired

17  member's first 12 months of retirement shall apply toward

18  repayment of benefits received in violation of the 780-hour

19  reemployment limitation.

20         6.  The Board of Trustees of the Florida School for the

21  Deaf and the Blind may reemploy a retired member as a

22  substitute teacher, substitute residential instructor, or

23  substitute nurse on a noncontractual basis after he or she has

24  been retired for 1 calendar month, in accordance with s.

25  121.021(39).  Any retired member who is reemployed within 1

26  calendar month after retirement shall void his or her

27  application for retirement benefits. The Board of Trustees of

28  the Florida School for the Deaf and the Blind reemploying such

29  teachers, residential instructors, or nurses is subject to the

30  retirement contribution required by subparagraph 7.

31  Reemployment of a retired member as a substitute teacher,

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 1  substitute residential instructor, or substitute nurse is

 2  limited to 780 hours during the first 12 months of his or her

 3  retirement. Any retired member reemployed for more than 780

 4  hours during the first 12 months of retirement shall give

 5  timely notice in writing to the employer and to the division

 6  of the date he or she will exceed the limitation. The division

 7  shall suspend his or her retirement benefits for the remainder

 8  of the first 12 months of retirement. Any person employed in

 9  violation of this subparagraph and any employing agency which

10  knowingly employs or appoints such person without notifying

11  the Division of Retirement to suspend retirement benefits

12  shall be jointly and severally liable for reimbursement to the

13  retirement trust fund of any benefits paid during the

14  reemployment limitation period. To avoid liability, such

15  employing agency shall have a written statement from the

16  retiree that he or she is not retired from a

17  state-administered retirement system. Any retirement benefits

18  received by a retired member while reemployed in excess of 780

19  hours during the first 12 months of retirement shall be repaid

20  to the Retirement System Trust Fund, and his or her retirement

21  benefits shall remain suspended until payment is made.

22  Benefits suspended beyond the end of the retired member's

23  first 12 months of retirement shall apply toward repayment of

24  benefits received in violation of the 780-hour reemployment

25  limitation.

26         7.  The employment by an employer of any retiree or

27  DROP participant of any state-administered retirement system

28  shall have no effect on the average final compensation or

29  years of creditable service of the retiree or DROP

30  participant.  Prior to July 1, 1991, upon employment of any

31  person, other than an elected officer as provided in s.

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 1  121.053, who has been retired under any state-administered

 2  retirement program, the employer shall pay retirement

 3  contributions in an amount equal to the unfunded actuarial

 4  liability portion of the employer contribution which would be

 5  required for regular members of the Florida Retirement System.

 6  Effective July 1, 1991, contributions shall be made as

 7  provided in s. 121.122 for retirees with renewed membership or

 8  subsection (13) with respect to DROP participants.

 9         8.  Any person who has previously retired and who is

10  holding an elective public office or an appointment to an

11  elective public office eligible for the Elected Officers'

12  Class on or after July 1, 1990, shall be enrolled in the

13  Florida Retirement System as provided in s. 121.053(1)(b) or,

14  if holding an elective public office that does not qualify for

15  the Elected Officers' Class on or after July 1, 1991, shall be

16  enrolled in the Florida Retirement System as provided in s.

17  121.122, and shall continue to receive retirement benefits as

18  well as compensation for the elected officer's service for as

19  long as he or she remains in elective office. However, any

20  retired member who served in an elective office prior to July

21  1, 1990, suspended his or her retirement benefit, and had his

22  or her Florida Retirement System membership reinstated shall,

23  upon retirement from such office, have his or her retirement

24  benefit recalculated to include the additional service and

25  compensation earned.

26         9.  Any person who is holding an elective public office

27  which is covered by the Florida Retirement System and who is

28  concurrently employed in nonelected covered employment may

29  elect to retire while continuing employment in the elective

30  public office, provided that he or she shall be required to

31  terminate his or her nonelected covered employment.  Any

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 1  person who exercises this election shall receive his or her

 2  retirement benefits in addition to the compensation of the

 3  elective office without regard to the time limitations

 4  otherwise provided in this subsection.  No person who seeks to

 5  exercise the provisions of this subparagraph, as the same

 6  existed prior to May 3, 1984, shall be deemed to be retired

 7  under those provisions, unless such person is eligible to

 8  retire under the provisions of this subparagraph, as amended

 9  by chapter 84-11, Laws of Florida.

10         10.  The limitations of this paragraph apply to

11  reemployment in any capacity with an "employer" as defined in

12  s. 121.021(10), irrespective of the category of funds from

13  which the person is compensated.

14         11.  An employing agency may reemploy a retired member

15  as a firefighter or paramedic after the retired member has

16  been retired for 1 calendar month, in accordance with s.

17  121.021(39). Any retired member who is reemployed within 1

18  calendar month after retirement shall void his or her

19  application for retirement benefits. The employing agency

20  reemploying such firefighter or paramedic is subject to the

21  retired contribution required in subparagraph 8. Reemployment

22  of a retired firefighter or paramedic is limited to no more

23  than 780 hours during the first 12 months of his or her

24  retirement. Any retired member reemployed for more than 780

25  hours during the first 12 months of retirement shall give

26  timely notice in writing to the employer and to the division

27  of the date he or she will exceed the limitation. The division

28  shall suspend his or her retirement benefits for the remainder

29  of the first 12 months of retirement. Any person employed in

30  violation of this subparagraph and any employing agency which

31  knowingly employs or appoints such person without notifying

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 1  the Division of Retirement to suspend retirement benefits

 2  shall be jointly and severally liable for reimbursement to the

 3  Retirement System Trust Fund of any benefits paid during the

 4  reemployment limitation period. To avoid liability, such

 5  employing agency shall have a written statement from the

 6  retiree that he or she is not retired from a

 7  state-administered retirement system. Any retirement benefits

 8  received by a retired member while reemployed in excess of 780

 9  hours during the first 12 months of retirement shall be repaid

10  to the Retirement System Trust Fund, and retirement benefits

11  shall remain suspended until repayment is made. Benefits

12  suspended beyond the end of the retired member's first 12

13  months of retirement shall apply toward repayment of benefits

14  received in violation of the 780-hour reemployment limitation.

15         (10)  FUTURE BENEFITS BASED ON ACTUARIAL DATA.--It is

16  the intent of the Legislature that future benefit increases

17  enacted into law in this chapter shall be financed

18  concurrently by increased contributions or other adequate

19  funding, and such funding shall be based on sound actuarial

20  data as developed by the actuary or state retirement actuary,

21  as provided in ss. 121.021(6) and 121.192.

22         (11)  A member who becomes eligible to retire and has

23  accumulated the maximum benefit of 100 percent of average

24  final compensation may continue in active service, and, if

25  upon the member's retirement the member elects to receive a

26  retirement compensation pursuant to subsection (2), subsection

27  (6), or subsection (7), the actuarial equivalent percentage

28  factor applicable to the age of such member at the time the

29  member reached the maximum benefit and to the age, at that

30  time, of the member's spouse shall determine the amount of

31  benefits to be paid.

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 1         (12)  SPECIAL PROVISIONS FOR PAYMENT OF CERTAIN

 2  SURVIVOR BENEFITS.--Notwithstanding any provision of this

 3  chapter to the contrary, for members with an effective date of

 4  retirement, or date of death if prior to retirement, on or

 5  after January 1, 1996, the named joint annuitant, as defined

 6  in s. 121.021(28)(b), who is eligible to receive benefits

 7  under subparagraph (6)(a)3. or subparagraph (6)(a)4., shall

 8  receive the maximum monthly retirement benefit that would have

 9  been payable to the member under subparagraph (6)(a)1.;

10  however, payment of such benefit shall cease the month the

11  joint annuitant attains age 25 unless such joint annuitant is

12  disabled and incapable of self-support, in which case,

13  benefits shall cease when the joint annuitant is no longer

14  disabled.  The administrator may require proof of disability

15  or continued disability in the same manner as is provided for

16  a member seeking or receiving a disability retirement benefit

17  under subsection (4).

18         (13)  DEFERRED RETIREMENT OPTION PROGRAM.--In general,

19  and subject to the provisions of this section, the Deferred

20  Retirement Option Program, hereinafter referred to as the

21  DROP, is a program under which an eligible member of the

22  Florida  Retirement System may elect to participate, deferring

23  receipt of retirement benefits while continuing employment

24  with his or her Florida Retirement System employer. The

25  deferred monthly benefits shall accrue in the System Trust

26  Fund on behalf of the participant, plus interest compounded

27  monthly, for the specified period of the DROP participation,

28  as provided in paragraph (c). Upon termination of employment,

29  the participant shall receive the total DROP benefits and

30  begin to receive the previously determined normal retirement

31  benefits. Participation in the DROP does not guarantee

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 1  employment for the specified period of DROP. Participation in

 2  the DROP by an eligible member beyond the initial 60-month

 3  period as authorized in this subsection shall be on an annual

 4  contractual basis for all participants.

 5         (a)  Eligibility of member to participate in the

 6  DROP.--All active Florida Retirement System members in a

 7  regularly established position, and all active members of

 8  either the Teachers' Retirement System established in chapter

 9  238 or the State and County Officers' and Employees'

10  Retirement System established in chapter 122 which systems are

11  consolidated within the Florida Retirement System under s.

12  121.011, are eligible to elect participation in the DROP

13  provided that:

14         1.  The member is not a renewed member of the Florida

15  Retirement System under s. 121.122, or a member of the State

16  Community College System Optional Retirement Program under s.

17  121.051, the Senior Management Service Optional Annuity

18  Program under s. 121.055, or the optional retirement program

19  for the State University System under s. 121.35.

20         2.  Except as provided in subparagraph 6., election to

21  participate is made within 12 months immediately following the

22  date on which the member first reaches normal retirement date,

23  or, for a member who reaches normal retirement date based on

24  service before he or she reaches age 62, or age 55 for Special

25  Risk Class members, election to participate may be deferred to

26  the 12 months immediately following the date the member

27  attains 57, or age 52 for Special Risk Class members. For a

28  member who first reached normal retirement date or the

29  deferred eligibility date described above prior to the

30  effective date of this section, election to participate shall

31  be made within 12 months after the effective date of this

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 1  section. A member who fails to make an election within such

 2  12-month limitation period shall forfeit all rights to

 3  participate in the DROP. The member shall advise his or her

 4  employer and the division in writing of the date on which the

 5  DROP shall begin. Such beginning date may be subsequent to the

 6  12-month election period, but must be within the 60-month or,

 7  with respect to members who are instructional personnel

 8  employed by the Florida School for the Deaf and the Blind and

 9  who have received authorization by the Board of Trustees of

10  the Florida School for the Deaf and the Blind to participate

11  in the DROP beyond 60 months, or who are instructional

12  personnel as defined in s. 1012.01(2)(a)-(d) in grades K-12

13  and who have received authorization by the district school

14  superintendent to participate in the DROP beyond 60 months,

15  the 96-month limitation period as provided in subparagraph

16  (b)1. When establishing eligibility of the member to

17  participate in the DROP for the 60-month or, with respect to

18  members who are instructional personnel employed by the

19  Florida School for the Deaf and the Blind and who have

20  received authorization by the Board of Trustees of the Florida

21  School for the Deaf and the Blind to participate in the DROP

22  beyond 60 months, or who are instructional personnel as

23  defined in s. 1012.01(2)(a)-(d) in grades K-12 and who have

24  received authorization by the district school superintendent

25  to participate in the DROP beyond 60 months, the 96-month

26  maximum participation period, the member may elect to include

27  or exclude any optional service credit purchased by the member

28  from the total service used to establish the normal retirement

29  date. A member with dual normal retirement dates shall be

30  eligible to elect to participate in DROP within 12 months

31  after attaining normal retirement date in either class.

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 1         3.  The employer of a member electing to participate in

 2  the DROP, or employers if dually employed, shall acknowledge

 3  in writing to the division the date the member's participation

 4  in the DROP begins and the date the member's employment and

 5  DROP participation will terminate.

 6         4.  Simultaneous employment of a participant by

 7  additional Florida Retirement System employers subsequent to

 8  the commencement of participation in the DROP shall be

 9  permissible provided such employers acknowledge in writing a

10  DROP termination date no later than the participant's existing

11  termination date or the 60-month limitation period as provided

12  in subparagraph (b)1.

13         5.  A DROP participant may change employers while

14  participating in the DROP, subject to the following:

15         a.  A change of employment must take place without a

16  break in service so that the member receives salary for each

17  month of continuous DROP participation.  If a member receives

18  no salary during a month, DROP participation shall cease

19  unless the employer verifies a continuation of the employment

20  relationship for such participant pursuant to s.

21  121.021(39)(b).

22         b.  Such participant and new employer shall notify the

23  division on forms required by the division as to the identity

24  of the new employer.

25         c.  The new employer shall acknowledge, in writing, the

26  participant's DROP termination date, which may be extended but

27  not beyond the original 60-month or, with respect to members

28  who are instructional personnel employed by the Florida School

29  for the Deaf and the Blind and who have received authorization

30  by the Board of Trustees of the Florida School for the Deaf

31  and the Blind to participate in the DROP beyond 60 months, or

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 1  who are instructional personnel as defined in s.

 2  1012.01(2)(a)-(d) in grades K-12 and who have received

 3  authorization by the district school superintendent to

 4  participate in the DROP beyond 60 months, the 96-month period

 5  provided in subparagraph (b)1., shall acknowledge liability

 6  for any additional retirement contributions and interest

 7  required if the participant fails to timely terminate

 8  employment, and shall be subject to the adjustment required in

 9  sub-subparagraph (c)5.d.

10         6.  Effective July 1, 2001, for instructional personnel

11  as defined in s. 1012.01(2), election to participate in the

12  DROP shall be made at any time following the date on which the

13  member first reaches normal retirement date. The member shall

14  advise his or her employer and the division in writing of the

15  date on which the Deferred Retirement Option Program shall

16  begin. When establishing eligibility of the member to

17  participate in the DROP for the 60-month or, with respect to

18  members who are instructional personnel employed by the

19  Florida School for the Deaf and the Blind and who have

20  received authorization by the Board of Trustees of the Florida

21  School for the Deaf and the Blind to participate in the DROP

22  beyond 60 months, or who are instructional personnel as

23  defined in s. 1012.01(2)(a)-(d) in grades K-12 and who have

24  received authorization by the district school superintendent

25  to participate in the DROP beyond 60 months, the 96-month

26  maximum participation period, as provided in subparagraph

27  (b)1., the member may elect to include or exclude any optional

28  service credit purchased by the member from the total service

29  used to establish the normal retirement date. A member with

30  dual normal retirement dates shall be eligible to elect to

31  participate in either class.

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 1         (b)  Participation in the DROP.--

 2         1.  An eligible member may elect to participate in the

 3  DROP for a period not to exceed a maximum of 60 calendar

 4  months or, with respect to members who are instructional

 5  personnel employed by the Florida School for the Deaf and the

 6  Blind and who have received authorization by the Board of

 7  Trustees of the Florida School for the Deaf and the Blind to

 8  participate in the DROP beyond 60 months, or who are

 9  instructional personnel as defined in s. 1012.01(2)(a)-(d) in

10  grades K-12 and who have received authorization by the

11  district school superintendent to participate in the DROP

12  beyond 60 calendar months, 96 calendar months immediately

13  following the date on which the member first reaches his or

14  her normal retirement date or the date to which he or she is

15  eligible to defer his or her election to participate as

16  provided in subparagraph (a)2. However, a member who has

17  reached normal retirement date prior to the effective date of

18  the DROP shall be eligible to participate in the DROP for a

19  period of time not to exceed 60 calendar months or, with

20  respect to members who are instructional personnel employed by

21  the Florida School for the Deaf and the Blind and who have

22  received authorization by the Board of Trustees of the Florida

23  School for the Deaf and the Blind to participate in the DROP

24  beyond 60 months, or who are instructional personnel as

25  defined in s. 1012.01(2)(a)-(d) in grades K-12 and who have

26  received authorization by the district school superintendent

27  to participate in the DROP beyond 60 calendar months, 96

28  calendar months immediately following the effective date of

29  the DROP, except a member of the Special Risk Class who has

30  reached normal retirement date prior to the effective date of

31  the DROP and whose total accrued value exceeds 75 percent of

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 1  average final compensation as of his or her effective date of

 2  retirement shall be eligible to participate in the DROP for no

 3  more than 36 calendar months immediately following the

 4  effective date of the DROP.

 5         2.  Upon deciding to participate in the DROP, the

 6  member shall submit, on forms required by the division:

 7         a.  A written election to participate in the DROP;

 8         b.  Selection of the DROP participation and termination

 9  dates, which satisfy the limitations stated in paragraph (a)

10  and subparagraph 1. Such termination date shall be in a

11  binding letter of resignation with the employer, establishing

12  a deferred termination date. The member may change the

13  termination date within the limitations of subparagraph 1.,

14  but only with the written approval of his or her employer;

15         c.  A properly completed DROP application for service

16  retirement as provided in this section; and

17         d.  Any other information required by the division.

18         3.  The DROP participant shall be a retiree under the

19  Florida Retirement System for all purposes, except for

20  paragraph (5)(f) and subsection (9) and ss. 112.3173, 112.363,

21  121.053, and 121.122. However, participation in the DROP does

22  not alter the participant's employment status and such

23  employee shall not be deemed retired from employment until his

24  or her deferred resignation is effective and termination

25  occurs as provided in s. 121.021(39).

26         4.  Elected officers shall be eligible to participate

27  in the DROP subject to the following:

28         a.  An elected officer who reaches normal retirement

29  date during a term of office may defer the election to

30  participate in the DROP until the next succeeding term in that

31  office. Such elected officer who exercises this option may

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 1  participate in the DROP for up to 60 calendar months or a

 2  period of no longer than such succeeding term of office,

 3  whichever is less.

 4         b.  An elected or a nonelected participant may run for

 5  a term of office while participating in DROP and, if elected,

 6  extend the DROP termination date accordingly, except, however,

 7  if such additional term of office exceeds the 60-month

 8  limitation established in subparagraph 1., and the officer

 9  does not resign from office within such 60-month limitation,

10  the retirement and the participant's DROP shall be null and

11  void as provided in sub-subparagraph (c)5.d.

12         c.  An elected officer who is dually employed and

13  elects to participate in DROP shall be required to satisfy the

14  definition of termination within the 60-month or, with respect

15  to members who are instructional personnel employed by the

16  Florida School for the Deaf and the Blind and who have

17  received authorization by the Board of Trustees of the Florida

18  School for the Deaf and the Blind to participate in the DROP

19  beyond 60 months, or who are instructional personnel as

20  defined in s. 1012.01(2)(a)-(d) in grades K-12 and who have

21  received authorization by the district school superintendent

22  to participate in the DROP beyond 60 months, the 96-month

23  limitation period as provided in subparagraph 1. for the

24  nonelected position and may continue employment as an elected

25  officer as provided in s. 121.053. The elected officer will be

26  enrolled as a renewed member in the Elected Officers' Class or

27  the Regular Class, as provided in ss. 121.053 and 121.22, on

28  the first day of the month after termination of employment in

29  the nonelected position and termination of DROP. Distribution

30  of the DROP benefits shall be made as provided in paragraph

31  (c).

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 1         (c)  Benefits payable under the DROP.--

 2         1.  Effective with the date of DROP participation, the

 3  member's initial normal monthly benefit, including creditable

 4  service, optional form of payment, and average final

 5  compensation, and the effective date of retirement shall be

 6  fixed. The beneficiary established under the Florida

 7  Retirement System shall be the beneficiary eligible to receive

 8  any DROP benefits payable if the DROP participant dies prior

 9  to the completion of the period of DROP participation. In the

10  event a joint annuitant predeceases the member, the member may

11  name a beneficiary to receive accumulated DROP benefits

12  payable. Such retirement benefit, the annual cost of living

13  adjustments provided in s. 121.101, and interest shall accrue

14  monthly in the System Trust Fund.  Such interest shall accrue

15  at an effective annual rate of 6.5 percent compounded monthly,

16  on the prior month's accumulated ending balance, up to the

17  month of termination or death.

18         2.  Each employee who elects to participate in the DROP

19  shall be allowed to elect to receive a lump-sum payment for

20  accrued annual leave earned in accordance with agency policy

21  upon beginning participation in the DROP. Such accumulated

22  leave payment certified to the division upon commencement of

23  DROP shall be included in the calculation of the member's

24  average final compensation.  The employee electing such

25  lump-sum payment upon beginning participation in DROP will not

26  be eligible to receive a second lump-sum payment upon

27  termination, except to the extent the employee has earned

28  additional annual leave which combined with the original

29  payment does not exceed the maximum lump-sum payment allowed

30  by the employing agency's policy or rules.  Such early

31  lump-sum payment shall be based on the hourly wage of the

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 1  employee at the time he or she begins participation in the

 2  DROP.  If the member elects to wait and receive such lump-sum

 3  payment upon termination of DROP and termination of employment

 4  with the employer, any accumulated leave payment made at that

 5  time cannot be included in the member's retirement benefit,

 6  which was determined and fixed by law when the employee

 7  elected to participate in the DROP.

 8         3.  The effective date of DROP participation and the

 9  effective date of retirement of a DROP participant shall be

10  the first day of the month selected by the member to begin

11  participation in the DROP, provided such date is properly

12  established, with the written confirmation of the employer,

13  and the approval of the division, on forms required by the

14  division.

15         4.  Normal retirement benefits and interest thereon

16  shall continue to accrue in the DROP until the established

17  termination date of the DROP, or until the participant

18  terminates employment or dies prior to such date. Although

19  individual DROP accounts shall not be established, a separate

20  accounting of each participant's accrued benefits under the

21  DROP shall be calculated and provided to participants.

22         5.  At the conclusion of the participant's DROP, the

23  division shall distribute the participant's total accumulated

24  DROP benefits, subject to the following provisions:

25         a.  The division shall receive verification by the

26  participant's employer or employers that such participant has

27  terminated employment as provided in s. 121.021(39)(b).

28         b.  The terminated DROP participant or, if deceased,

29  such participant's named beneficiary, shall elect on forms

30  provided by the division to receive payment of the DROP

31  benefits in accordance with one of the options listed below.

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 1  For a participant or beneficiary who fails to elect a method

 2  of payment within 60 days of termination of the DROP, the

 3  division will pay a lump sum as provided in

 4  sub-sub-subparagraph (I).

 5         (I)  Lump sum.--All accrued DROP benefits, plus

 6  interest, less withholding taxes remitted to the Internal

 7  Revenue Service, shall be paid to the DROP participant or

 8  surviving beneficiary.

 9         (II)  Direct rollover.--All accrued DROP benefits, plus

10  interest, shall be paid from the DROP directly to the

11  custodian of an eligible retirement plan as defined in s.

12  402(c)(8)(B) of the Internal Revenue Code. However, in the

13  case of an eligible rollover distribution to the surviving

14  spouse of a deceased participant, an eligible retirement plan

15  is an individual retirement account or an individual

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

17  Internal Revenue Code.

18         (III)  Partial lump sum.--A portion of the accrued DROP

19  benefits shall be paid to the DROP participant or surviving

20  spouse, less withholding taxes remitted to the Internal

21  Revenue Service, and the remaining DROP benefits shall be

22  transferred directly to the custodian of an eligible

23  retirement plan as defined in s. 402(c)(8)(B) of the Internal

24  Revenue Code. However, in the case of an eligible rollover

25  distribution to the surviving spouse of a deceased

26  participant, an eligible retirement plan is an individual

27  retirement account or an individual retirement annuity as

28  described in s. 402(c)(9) of the Internal Revenue Code. The

29  proportions shall be specified by the DROP participant or

30  surviving beneficiary.

31  

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 1         c.  The form of payment selected by the DROP

 2  participant or surviving beneficiary complies with the minimum

 3  distribution requirements of the Internal Revenue Code.

 4         d.  A DROP participant who fails to terminate

 5  employment as defined in s. 121.021(39)(b) shall be deemed not

 6  to be retired, and the DROP election shall be null and void.

 7  Florida Retirement System membership shall be reestablished

 8  retroactively to the date of the commencement of the DROP, and

 9  each employer with whom the participant continues employment

10  shall be required to pay to the System Trust Fund the

11  difference between the DROP contributions paid in paragraph

12  (i) and the contributions required for the applicable Florida

13  Retirement System class of membership during the period the

14  member participated in the DROP, plus 6.5 percent interest

15  compounded annually.

16         6.  The accrued benefits of any DROP participant, and

17  any contributions accumulated under such program, shall not be

18  subject to assignment, execution, attachment, or to any legal

19  process whatsoever, except for qualified domestic relations

20  orders by a court of competent jurisdiction, income deduction

21  orders as provided in s. 61.1301, and federal income tax

22  levies.

23         7.  DROP participants shall not be eligible for

24  disability retirement benefits as provided in subsection (4).

25         (d)  Death benefits under the DROP.--

26         1.  Upon the death of a DROP participant, the named

27  beneficiary shall be entitled to apply for and receive the

28  accrued benefits in the DROP as provided in sub-subparagraph

29  (c)5.b.

30  

31  

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 1         2.  The normal retirement benefit accrued to the DROP

 2  during the month of a participant's death shall be the final

 3  monthly benefit credited for such DROP participant.

 4         3.  Eligibility to participate in the DROP terminates

 5  upon death of the participant.  If the participant dies on or

 6  after the effective date of enrollment in the DROP, but prior

 7  to the first monthly benefit being credited to the DROP,

 8  Florida Retirement System benefits shall be paid in accordance

 9  with subparagraph (7)(c)1. or subparagraph 2.

10         4.  A DROP participants' survivors shall not be

11  eligible to receive Florida Retirement System death benefits

12  as provided in paragraph (7)(d).

13         (e)  Cost-of-living adjustment.--On each July 1, the

14  participants' normal retirement benefit shall be increased as

15  provided in s. 121.101.

16         (f)  Retiree health insurance subsidy.--DROP

17  participants are not eligible to apply for the retiree health

18  insurance subsidy payments as provided in s. 112.363 until

19  such participants have terminated employment and participation

20  in the DROP.

21         (g)  Renewed membership.--DROP participants shall not

22  be eligible for renewed membership in the Florida Retirement

23  System under ss. 121.053 and 121.122 until termination of

24  employment is effectuated as provided in s. 121.021(39)(b).

25         (h)  Employment limitation after DROP

26  participation.--Upon satisfying the definition of termination

27  of employment as provided in s. 121.021(39)(b), DROP

28  participants shall be subject to such reemployment limitations

29  as other retirees. Reemployment restrictions applicable to

30  retirees as provided in subsection (9) shall not apply to DROP

31  

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 1  participants until their employment and participation in the

 2  DROP are terminated.

 3         (i)  Contributions.--

 4         1.  All employers paying the salary of a DROP

 5  participant filling a regularly established position shall

 6  contribute 8.0 percent of such participant's gross

 7  compensation for the period of July 1, 2002, through June 30,

 8  2003, and 11.56 percent of such compensation thereafter, which

 9  shall constitute the entire employer DROP contribution with

10  respect to such participant.  Such contributions, payable to

11  the System Trust Fund in the same manner as required in s.

12  121.071, shall be made as appropriate for each pay period and

13  are in addition to contributions required for social security

14  and the Retiree Health Insurance Subsidy Trust Fund. Such

15  employer, social security, and health insurance subsidy

16  contributions are not included in the DROP.

17         2.  The employer shall, in addition to subparagraph 1.,

18  also withhold one-half of the entire social security

19  contribution required for the participant.  Contributions for

20  social security by each participant and each employer, in the

21  amount required for social security coverage as now or

22  hereafter provided by the federal Social Security Act, shall

23  be in addition to contributions specified in subparagraph 1.

24         3.  All employers paying the salary of a DROP

25  participant filling a regularly established position shall

26  contribute the percent of such participant's gross

27  compensation required in s. 121.071(4), which shall constitute

28  the employer's health insurance subsidy contribution with

29  respect to such participant. Such contributions shall be

30  deposited by the administrator in the Retiree Health Insurance

31  Subsidy Trust Fund.

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 1         (j)  Forfeiture of retirement benefits.--Nothing in

 2  this section shall be construed to remove DROP participants

 3  from the scope of s. 8(d), Art. II of the State Constitution,

 4  s. 112.3173, and paragraph (5)(f). DROP participants who

 5  commit a specified felony offense while employed will be

 6  subject to forfeiture of all retirement benefits, including

 7  DROP benefits, pursuant to those provisions of law.

 8         (k)  Administration of program.--The division shall

 9  make such rules as are necessary for the effective and

10  efficient administration of this subsection. The division

11  shall not be required to advise members of the federal tax

12  consequences of an election related to the DROP but may advise

13  members to seek independent advice.

14         (14)  PAYMENT OF BENEFITS.--This subsection applies to

15  the payment of benefits to a payee (retiree or beneficiary)

16  under the Florida Retirement System:

17         (a)  Federal income tax shall be withheld in accordance

18  with federal law, unless the payee elects otherwise on Form

19  W-4P. The division shall prepare and distribute to each

20  recipient of monthly retirement benefits an appropriate income

21  tax form that reflects the recipient's income and federal

22  income tax withheld for the calendar year just ended.

23         (b)  Subject to approval by the division in accordance

24  with rule 60S-4.015, Florida Administrative Code, a payee

25  receiving retirement benefits under the Florida Retirement

26  System may also have the following payments deducted from his

27  or her monthly benefit:

28         1.  Premiums for life and health-related insurance

29  policies from approved companies.

30  

31  

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 1         2.  Life insurance premiums for the State Group Life

 2  Insurance Plan, if authorized in writing by the payee and by

 3  the Department of Management Services.

 4         3.  Repayment of overpayments from the Florida

 5  Retirement System Trust Fund, the State Employees' Health

 6  Insurance Trust Fund, or the State Employees' Life Insurance

 7  Trust Fund, upon notification of the payee.

 8         4.  Payments to an alternate payee for alimony, child

 9  support, or division of marital assets pursuant to a qualified

10  domestic relations order under s. 222.21 or an income

11  deduction order under s. 61.1301.

12         5.  Payments to the Internal Revenue Service for

13  federal income tax levies, upon notification of the division

14  by the Internal Revenue Service.

15         (c)  A payee shall notify the division of any change in

16  his or her address. The division may suspend benefit payments

17  to a payee if correspondence sent to the payee's mailing

18  address is returned due to an incorrect address. Benefit

19  payments shall be resumed upon notification to the division of

20  the payee's new address.

21         (d)  A payee whose retirement benefits are reduced by

22  the application of maximum benefit limits under s. 415(b) of

23  the Internal Revenue Code, as specified in s. 121.30(5), shall

24  have the portion of his or her calculated benefit in the

25  Florida Retirement System defined benefit plan which exceeds

26  such federal limitation paid through the Florida Retirement

27  System Preservation of Benefits Plan, as provided in s.

28  121.1001.

29         (e)  No benefit may be reduced for the purpose of

30  preserving the member's eligibility for a federal program.

31  

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 1         (f)  The division shall adopt rules establishing

 2  procedures for determining that the persons to whom benefits

 3  are being paid are still living. The division shall suspend

 4  the benefits being paid to any payee when it is unable to

 5  contact such payee and to confirm that he or she is still

 6  living.

 7         Section 25.  Subsection (1) of section 121.095, Florida

 8  Statutes, is amended to read:

 9         121.095  Florida Retirement System Preservation of

10  Benefits Plan Trust Fund.--

11         (1)  The Florida Retirement System Preservation of

12  Benefits Plan Trust Fund is created in the State Treasury to

13  be administered by the State Board of Administration within

14  the Division of Retirement.

15         (a)  Funds to be credited to the trust fund shall

16  consist of Florida Retirement System monthly retirement

17  contributions required to meet the requirements for payment of

18  restored benefits under the Florida Retirement System

19  Preservation of Benefits Plan, as specified in s. 121.1001.

20         (b)  The trust fund shall be maintained and utilized

21  solely for the purpose of providing benefits under the

22  Preservation of Benefits Plan, as specified in s. 121.1001.

23         (c)  The trust fund shall be separate and apart from

24  the Florida Retirement System Trust Fund.  The trust fund

25  moneys and assets shall not be commingled with nor ever

26  receive a transfer of moneys and assets from the remainder of

27  the Florida Retirement System, including, but not limited to,

28  the Florida Retirement System Trust Fund, or any other

29  qualified retirement plan administered by the Division of

30  Retirement.

31  

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 1         (d)  The trust fund shall be funded on a month-to-month

 2  basis.  Trust fund assets shall not be accumulated to pay

 3  future benefits.

 4         Section 26.  Paragraph (b) of subsection (7) of section

 5  121.101, Florida Statutes, is amended to read:

 6         121.101  Cost-of-living adjustment of benefits.--

 7         (7)  The purpose of this subsection is to establish a

 8  supplemental cost-of-living adjustment for certain retirees

 9  and beneficiaries who receive monthly retirement benefits

10  under the provisions of this chapter and the existing systems

11  consolidated therein, s. 112.05 for certain state officers and

12  employees, and s. 238.171 for certain elderly incapacitated

13  teachers.

14         (b)  Application for the supplemental cost-of-living

15  adjustment provided by this subsection shall include

16  certification by the retiree or annuitant that he or she is

17  not receiving, and is not eligible to receive, social security

18  benefits and shall include written authorization for the

19  division department to have access to information from the

20  Social Security Administration concerning his or her

21  entitlement to, or eligibility for, social security benefits.

22  Such supplemental cost-of-living adjustment shall not be paid

23  unless and until the application requirements of this

24  paragraph are met.

25         Section 27.  Paragraph (e) of subsection (2) of section

26  121.111, Florida Statutes, is amended to read:

27         121.111  Credit for military service.--

28         (2)  Any member whose initial date of employment is

29  before January 1, 1987, who has military service as defined in

30  s. 121.021(20)(b), and who does not claim such service under

31  

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 1  subsection (1) may receive creditable service for such

 2  military service if:

 3         (e)  Any member claiming credit under this subsection

 4  must certify on the form prescribed by the division department

 5  that credit for such service has not and will not be claimed

 6  for retirement purposes under any other federal, state, or

 7  local retirement or pension system where "length of service"

 8  is a factor in determining the amount of compensation

 9  received, except where credit for such service has been

10  granted in a pension system providing retired pay for

11  nonregular service as provided in paragraph (d). If the member

12  dies prior to retirement, the member's beneficiary must make

13  the required certification before credit may be claimed. If

14  such certification is not made by the member or the member's

15  beneficiary, credit for wartime military service shall not be

16  allowed.

17         Section 28.  Section 121.133, Florida Statutes, is

18  amended to read:

19         121.133  Cancellation of uncashed

20  warrants.--Notwithstanding the provisions of s. 17.26 or s.

21  717.123 to the contrary, if any state warrant issued by the

22  Chief Financial Officer for the payment of retirement benefits

23  from the Florida Retirement System Trust Fund, or any other

24  pension trust fund administered by the division department, is

25  not presented for payment within 1 year after the last day of

26  the month in which it was originally issued, the Chief

27  Financial Officer shall cancel the benefit warrant and credit

28  the amount of the warrant to the Florida Retirement System

29  Trust Fund or other pension trust fund administered by the

30  division department, as appropriate.  The division department

31  

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 1  may provide for issuance of a replacement warrant when deemed

 2  appropriate.

 3         Section 29.  Section 121.135, Florida Statutes, is

 4  amended to read:

 5         121.135  Annual report to Legislature concerning the

 6  Florida Retirement System state-administered retirement

 7  systems.--The board department shall make to each regular

 8  session of the Legislature a written report on the operation

 9  and condition of the Florida Retirement System the

10  state-administered retirement systems.

11         Section 30.  Section 121.136, Florida Statutes, is

12  amended to read:

13         121.136  Annual benefit statement to

14  members.--Beginning January 1, 1993, and each January

15  thereafter, the board department shall provide each active

16  member of the Florida Retirement System with 5 or more years

17  of creditable service an annual statement of benefits. Such

18  statement should provide the member with basic data about the

19  member's retirement account. Minimally, it shall include the

20  member's retirement plan, the amount of funds on deposit in

21  the retirement account, and an estimate of retirement

22  benefits.

23         Section 31.  Section 121.1905, Florida Statutes, is

24  amended to read:

25         121.1905  Division of Retirement; mission creation.--

26         (1)  There is created the Division of Retirement within

27  the Department of Management Services.

28         (2)  The mission of the Division of Retirement is to

29  provide quality and cost-effective retirement services as

30  measured by member satisfaction and by comparison with

31  administrative costs of comparable retirement systems.

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 1         Section 32.  Section 121.192, Florida Statutes, is

 2  amended to read:

 3         121.192  State retirement actuary.--The division

 4  department may employ an actuary. Such actuary shall, together

 5  with such other duties as the administrator assigns secretary

 6  may assign, be responsible for:

 7         (1)  Advising the administrator secretary on actuarial

 8  matters of the state retirement systems.

 9         (2)  Making periodic valuations of the retirement

10  systems.

11         (3)  Providing actuarial analyses to the Legislature

12  concerning proposed changes in the retirement systems.

13         (4)  Assisting the administrator secretary in

14  developing a sound and modern retirement system.

15         Section 33.  Section 121.193, Florida Statutes, is

16  amended to read:

17         121.193  External compliance audits.--

18         (1)  The division department shall conduct audits of

19  the payroll and personnel records of participating agencies.

20  These audits shall be made to determine the accuracy of

21  reports submitted to the division department and to assess the

22  degree of compliance with applicable statutes, rules, and

23  coverage agreements. Audits shall be scheduled on a regular

24  basis, as the result of concerns known to exist at an agency,

25  or as a followup to ensure agency action was taken to correct

26  deficiencies found in an earlier audit.

27         (2)  Upon request, participating agencies shall furnish

28  the division department with information and documents that

29  the division department requires to conduct the audit. The

30  division department may prescribe by rule the documents that

31  may be requested.

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 1         (3)  The division department shall review the agency's

 2  operations concerning retirement and social security coverage.

 3  Preliminary findings shall be discussed with agency personnel

 4  at the close of the audit. An audit report of findings and

 5  recommendations shall be submitted to division department

 6  management and an audit summary letter shall be submitted to

 7  the agency noting any concerns and necessary corrective

 8  action.

 9         Section 34.  Subsection (1) of section 121.22, Florida

10  Statutes, is amended to read:

11         121.22  State Retirement Commission; creation;

12  membership; compensation.--

13         (1)  There is created within the Division of Retirement

14  Department of Management Services a State Retirement

15  Commission composed of three members: One member who is

16  retired under a state-supported retirement system administered

17  by the division department; one member who is an active member

18  of a state-supported retirement system that is administered by

19  the division department; and one member who is neither a

20  retiree, beneficiary, or member of a state-supported

21  retirement system administered by the division department.

22  Each member shall have a different occupational background

23  from the other members.

24         Section 35.  Subsection (1) of section 121.23, Florida

25  Statutes, is amended to read:

26         121.23  Disability retirement and special risk

27  membership applications; Retirement Commission; powers and

28  duties; judicial review.--The provisions of this section apply

29  to all proceedings in which the administrator has made a

30  written final decision on the merits respecting applications

31  for disability retirement, reexamination of retired members

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 1  receiving disability benefits, applications for special risk

 2  membership, and reexamination of special risk members in the

 3  Florida Retirement System. The jurisdiction of the State

 4  Retirement Commission under this section shall be limited to

 5  written final decisions of the administrator on the merits.

 6         (1)  In accordance with the rules of procedure adopted

 7  by the division Department of Management Services, the

 8  administrator shall:

 9         (a)  Give reasonable notice of his or her proposed

10  action, or decision to refuse action, together with a summary

11  of the factual, legal, and policy grounds therefor.

12         (b)  Give affected members, or their counsel, an

13  opportunity to present to the division written evidence in

14  opposition to the proposed action or refusal to act or a

15  written statement challenging the grounds upon which the

16  administrator has chosen to justify his or her action or

17  inaction.

18         (c)  If the objections of the member are overruled,

19  provide a written explanation within 21 days.

20         Section 36.  Subsections (2), (3), and (4) of section

21  121.24, Florida Statutes, are amended to read:

22         121.24  Conduct of commission business; legal and other

23  assistance; compensation.--

24         (2)  Legal counsel for the commission may be provided

25  by the Department of Legal Affairs or by the division

26  Department of Management Services, with the concurrence of the

27  commission, and shall be paid by the division Department of

28  Management Services from the appropriate funds.

29         (3)  The division Department of Management Services

30  shall provide timely and appropriate training for newly

31  appointed members of the commission. Such training shall be

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 1  designed to acquaint new members of the commission with the

 2  duties and responsibilities of the commission.

 3         (4)  The division Department of Management Services

 4  shall furnish administrative and secretarial assistance to the

 5  commission and shall provide a place where the commission may

 6  hold its meetings.

 7         Section 37.  Subsection (9) of section 121.30, Florida

 8  Statutes, is amended to read:

 9         121.30  Statements of purpose and intent and other

10  provisions required for qualification under the Internal

11  Revenue Code of the United States.--Any other provisions in

12  this chapter to the contrary notwithstanding, it is

13  specifically provided that:

14         (9)  The division department may adopt any rule

15  necessary to accomplish the purpose of the section which is

16  not inconsistent with this chapter.

17         Section 38.  Paragraph (c) of subsection (2),

18  paragraphs (c) and (e) of subsection (3), paragraphs (a), (b),

19  and (c) of subsection (4), and subsection (6) of section

20  121.35, Florida Statutes, are amended to read:

21         121.35  Optional retirement program for the State

22  University System.--

23         (2)  ELIGIBILITY FOR PARTICIPATION IN OPTIONAL

24  PROGRAM.--

25         (c)  For purposes of this section, the State Board of

26  Administration Department of Management Services is referred

27  to as the "board department."

28         (3)  ELECTION OF OPTIONAL PROGRAM.--

29         (c)  Any employee who becomes eligible to participate

30  in the optional retirement program on or after January 1,

31  1993, shall be a compulsory participant of the program unless

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 1  such employee elects membership in the Florida Retirement

 2  System. Such election shall be made in writing and filed with

 3  the personnel officer of the employer. Any eligible employee

 4  who fails to make such election within the prescribed time

 5  period shall be deemed to have elected to participate in the

 6  optional retirement program.

 7         1.  Any employee whose optional retirement program

 8  eligibility results from initial employment shall be enrolled

 9  in the program at the commencement of employment. If, within

10  90 days after commencement of employment, the employee elects

11  membership in the Florida Retirement System, such membership

12  shall be effective retroactive to the date of commencement of

13  employment.

14         2.  Any employee whose optional retirement program

15  eligibility results from a change in status due to the

16  subsequent designation of the employee's position as one of

17  those specified in paragraph (2)(a) or due to the employee's

18  appointment, promotion, transfer, or reclassification to a

19  position specified in paragraph (2)(a) shall be enrolled in

20  the optional retirement program upon such change in status and

21  shall be notified by the employer of such action. If, within

22  90 days after the date of such notification, the employee

23  elects to retain membership in the Florida Retirement System,

24  such continuation of membership shall be retroactive to the

25  date of the change in status.

26         3.  Notwithstanding the provisions of this paragraph,

27  effective July 1, 1997, any employee who is eligible to

28  participate in the Optional Retirement Program and who fails

29  to execute a contract with one of the approved companies and

30  to notify the board department in writing as provided in

31  subsection (4) within 90 days after the date of eligibility

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 1  shall be deemed to have elected membership in the Florida

 2  Retirement System, except as provided in s. 121.051(1)(a).

 3  This provision shall also apply to any employee who terminates

 4  employment in an eligible position before executing the

 5  required annuity contract and notifying the board department.

 6  Such membership shall be retroactive to the date of

 7  eligibility, and all appropriate contributions shall be

 8  transferred to the Florida Retirement System Trust Fund and

 9  the Health Insurance Subsidy Trust Fund.

10         (e)  The election by an eligible employee to

11  participate in the optional retirement program shall be

12  irrevocable for so long as the employee continues to meet the

13  eligibility requirements specified in subsection (2), except

14  as provided in paragraph (h). In the event that an employee

15  participates in the optional retirement program for 90 days or

16  more and is subsequently employed in an administrative or

17  professional position which has been determined by the board

18  department, under subparagraph (2)(a)2., to be not otherwise

19  eligible for participation in the optional retirement program,

20  the employee shall continue participation in the optional

21  program so long as the employee meets the other eligibility

22  requirements for the program, except as provided in paragraph

23  (h).

24         (4)  CONTRIBUTIONS.--

25         (a)  Through June 30, 2001, each employer shall

26  contribute on behalf of each participant in the optional

27  retirement program an amount equal to the normal cost portion

28  of the employer retirement contribution which would be

29  required if the participant were a regular member of the

30  Florida Retirement System defined benefit program, plus the

31  portion of the contribution rate required in s. 112.363(8)

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 1  that would otherwise be assigned to the Retiree Health

 2  Insurance Subsidy Trust Fund. Effective July 1, 2001, each

 3  employer shall contribute on behalf of each participant in the

 4  optional program an amount equal to 10.43 percent of the

 5  participant's gross monthly compensation. The board, pursuant

 6  to s. 215.44(4), department shall deduct an amount approved by

 7  the Legislature to provide for the administration of this

 8  program. The payment of the contributions to the optional

 9  program which is required by this paragraph for each

10  participant shall be made by the employer to the board

11  department, which shall forward the contributions to the

12  designated company or companies contracting for payment of

13  benefits for the participant under the program. However, such

14  contributions paid on behalf of an employee described in

15  paragraph (3)(c) shall not be forwarded to a company and shall

16  not begin to accrue interest until the employee has executed

17  an annuity contract and notified the board department.

18         (b)  Each employer shall contribute on behalf of each

19  participant in the optional retirement program an amount equal

20  to the unfunded actuarial accrued liability portion of the

21  employer contribution which would be required for members of

22  the Florida Retirement System. This contribution shall be paid

23  to the board department for transfer to the Florida Retirement

24  System Trust Fund.

25         (c)  An Optional Retirement Program Trust Fund shall be

26  established in the State Treasury and administered by the

27  board department to make payments to the provider companies on

28  behalf of the optional retirement program participants, and to

29  transfer the unfunded liability portion of the state optional

30  retirement program contributions to the Florida Retirement

31  System Trust Fund.

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 1         (6)  ADMINISTRATION OF PROGRAM.--

 2         (a)  The optional retirement program authorized by this

 3  section shall be administered by the board department. The

 4  board department shall adopt rules establishing the

 5  responsibilities of the State Board of Education and

 6  institutions in the State University System in administering

 7  the optional retirement program. The State Board of Education

 8  shall, no more than 90 days after July 1, 1983, submit to the

 9  board department its recommendations for the contracts to be

10  offered by the companies chosen by the board department. The

11  recommendations of the State Board of Education shall include

12  the following:

13         1.  The nature and extent of the rights and benefits in

14  relation to the required contributions; and

15         2.  The suitability of the rights and benefits to the

16  needs of the participants and the interests of the

17  institutions in the recruitment and retention of eligible

18  employees.

19         (b)  After receiving and considering the

20  recommendations of the State Board of Education, the board

21  department shall designate no more than four companies from

22  which contracts may be purchased under the program and shall

23  approve the form and content of the optional retirement

24  program contracts. Upon application by a qualified Florida

25  domestic company, the board department shall give reasonable

26  notice to all other such companies that it intends to

27  designate one of such companies as a fifth company from which

28  contracts may be purchased pursuant to this section and that

29  they may apply for such designation prior to the deadline

30  established by said notice. At least 60 days after giving such

31  notice and upon receipt of the recommendation of the State

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 1  Board of Education, the board department shall so designate

 2  one of such companies as the fifth company from which such

 3  contracts may be purchased.

 4         (c)  Effective July 1, 1997, the State Board of

 5  Administration shall review and make recommendations to the

 6  department on the acceptability of all investment products

 7  proposed by provider companies of the optional retirement

 8  program before they are offered through annuity contracts to

 9  the participants and may advise the department of any changes

10  necessary to ensure that the optional retirement program

11  offers an acceptable mix of investment products. The board

12  department shall determine which make the final determination

13  as to whether an investment products product will be included

14  in approved for the program.

15         (d)  The provisions of each contract applicable to a

16  participant in the optional retirement program shall be

17  contained in a written program description which shall include

18  a report of pertinent financial and actuarial information on

19  the solvency and actuarial soundness of the program and the

20  benefits applicable to the participant. Such description shall

21  be furnished by the companies to each participant in the

22  program and to the board department upon commencement of

23  participation in the program and annually thereafter.

24         (e)  The board department shall ensure that each

25  participant in the optional retirement program is provided an

26  accounting of the total contribution and the annual

27  contribution made by and on behalf of such participant.

28         Section 39.  Paragraph (b) of subsection (3), paragraph

29  (a) of subsection (12), and paragraphs (a) and (b) of

30  subsection (14) of section 121.40, Florida Statutes, are

31  amended to read:

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 1         121.40  Cooperative extension personnel at the

 2  Institute of Food and Agricultural Sciences; supplemental

 3  retirement benefits.--

 4         (3)  DEFINITIONS.--The definitions provided in s.

 5  121.021 shall not apply to this section except when

 6  specifically cited.  For the purposes of this section, the

 7  following words or phrases have the respective meanings set

 8  forth:

 9         (b)  "Division Department" means the Division of

10  Retirement of the State Board of Administration Department of

11  Management Services.

12         (12)  CONTRIBUTIONS.--

13         (a)  For the purposes of funding the supplemental

14  benefits provided by this section, the institute is authorized

15  and required to pay, commencing July 1, 1985, the necessary

16  monthly contributions from its appropriated budget. These

17  amounts shall be paid into the Institute of Food and

18  Agricultural Sciences Supplemental Retirement Trust Fund,

19  which is hereby created in the State Treasury to be

20  administered by the State Board of Administration.

21         (14)  ADMINISTRATION OF SYSTEM.--

22         (a)  The division department shall make such rules as

23  are necessary for the effective and efficient administration

24  of this system.  The executive director of the State Board of

25  Administration secretary of the department shall be the

26  administrator of the system. The funds to pay the expenses for

27  such administration are shall be appropriated from the

28  interest earned on investments made for the trust fund.

29         (b)  The division department is authorized to require

30  oaths, by affidavit or otherwise, and acknowledgments from

31  

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 1  persons in connection with the administration of its duties

 2  and responsibilities under this section.

 3         Section 40.  Subsection (3) of section 121.45, Florida

 4  Statutes, is amended to read:

 5         121.45  Interstate compacts relating to pension

 6  portability.--

 7         (3)  ESTABLISHMENT OF COMPACTS.--

 8         (a)  The division Department of Management Services is

 9  authorized and directed to survey other state retirement

10  systems to determine if such retirement systems are interested

11  in developing an interstate compact with Florida.

12         (b)  If any such state is interested in pursuing the

13  matter, the division department shall confer with the other

14  state and the consulting actuaries of both states, and shall

15  present its findings to the committees having jurisdiction

16  over retirement matters in the Legislature, and to

17  representatives of affected certified bargaining units, in

18  order to determine the feasibility of developing a portability

19  compact, what groups should be covered, and the goals and

20  priorities which should guide such development.

21         (c)  Upon a determination that such a compact is

22  feasible and upon request of the Legislature, the division

23  department, together with its consulting actuaries, shall, in

24  accordance with such said goals and priorities, develop a

25  proposal under which retirement credit may be transferred to

26  or from Florida in an actuarially sound manner.

27         (d)  Once a proposal has been developed, the division

28  department shall contract with its consulting actuaries to

29  conduct an actuarial study of the proposal to determine the

30  cost to the Florida Retirement System Trust Fund and the State

31  of Florida.

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 1         (e)  After the actuarial study has been completed, the

 2  division department shall present its findings and the

 3  actuarial study to the Legislature for consideration. If

 4  either house of the Legislature elects to enter into such a

 5  compact, it shall be introduced in the form of a proposed

 6  committee bill to the full Legislature during the same or next

 7  regular session.

 8         Section 41.  Subsection (2), paragraph (a) of

 9  subsection (5), paragraphs (a), (b), (c), and (e) of

10  subsection (8), paragraph (c) of subsection (9), paragraphs

11  (a), (c), and (f) of subsection (10), subsection (11), and

12  subsection (19) of section 121.4501, Florida Statutes, are

13  amended to read:

14         121.4501  Public Employee Optional Retirement

15  Program.--

16         (2)  DEFINITIONS.--As used in this part, the term:

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

18  sector company that is selected and approved by the state

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

20  the Public Employee Optional Retirement Program. The term

21  includes a bundled provider that offers participants a range

22  of individually allocated or unallocated investment products

23  and may offer a range of administrative and customer services,

24  which may include accounting and administration of individual

25  participant benefits and contributions; individual participant

26  recordkeeping; asset purchase, control, and safekeeping;

27  direct execution of the participant's instructions as to asset

28  and contribution allocation; calculation of daily net asset

29  values; direct access to participant account information;

30  periodic reporting to participants, at least quarterly, on

31  account balances and transactions; guidance, advice, and

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 1  allocation services directly relating to its own investment

 2  options or products, but only if the bundled provider complies

 3  with the standard of care of s. 404(a)(1)(A-B) of the Employee

 4  Retirement Income Security Act of 1974 (ERISA) and if

 5  providing such guidance, advice, or allocation services does

 6  not constitute a prohibited transaction under s. 4975(c)(1) of

 7  the Internal Revenue Code or s. 406 of ERISA, notwithstanding

 8  that such prohibited transaction provisions do not apply to

 9  the optional retirement program; a broad array of distribution

10  options; asset allocation; and retirement counseling and

11  education. Private sector companies include investment

12  management companies, insurance companies, depositories, and

13  mutual fund companies.

14         (b)  "Average monthly compensation" means one-twelfth

15  of average final compensation as defined in s. 121.021(24).

16         (c)  "Covered employment" means employment in a

17  regularly established position as defined in s. 121.021(52).

18         (d)  "Department" means the Department of Management

19  Services.

20         (d)(e)  "Division" means the Division of Retirement of

21  the State Board of Administration within the Department of

22  Management Services.

23         (e)(f)  "Eligible employee" means an officer or

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

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

26  the Florida Retirement System, including any renewed member of

27  the Florida Retirement System;

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

29  the Senior Management Service Optional Annuity Program as

30  established under s. 121.055(6) or the State Community College

31  

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 1  Optional Retirement Program as established under s.

 2  121.051(2)(c); or

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

 4  participate in, the State University System Optional

 5  Retirement Program established under s. 121.35.

 6  

 7  The term does not include any member participating in the

 8  Deferred Retirement Option Program established under s.

 9  121.091(13) or any employee participating in an optional

10  retirement program established under s. 121.051(2)(c) or s.

11  121.35.

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

13  121.021(10), of an eligible employee.

14         (g)(h)  "Participant" means an eligible employee who

15  elects to participate in the Public Employee Optional

16  Retirement Program and enrolls in such optional program as

17  provided in subsection (4).

18         (h)(i)  "Public Employee Optional Retirement Program,"

19  "optional program," or "optional retirement program" means the

20  alternative defined contribution retirement program

21  established under this section.

22         (i)(j)  "State board" or "board" means the State Board

23  of Administration.

24         (j)(k)  "Trustees" means Trustees of the State Board of

25  Administration.

26         (k)(l)  "Vested" or "vesting" means the guarantee that

27  a participant is eligible to receive a retirement benefit upon

28  completion of the required years of service under the Public

29  Employee Optional Retirement Program.

30         (5)  CONTRIBUTIONS.--

31  

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

 2  participant in the Public Employee Optional Retirement

 3  Program, as provided in part III of this chapter. The state

 4  board, acting as plan fiduciary, shall ensure that all plan

 5  assets are held in a trust, pursuant to s. 401 of the Internal

 6  Revenue Code. The fiduciary shall ensure that said

 7  contributions are allocated as follows:

 8         1.  The portion earmarked for participant accounts

 9  shall be used to purchase interests in the appropriate

10  investment vehicles for the accounts of each participant as

11  specified by the participant, or in accordance with paragraph

12  (4)(d).

13         2.  The portion earmarked for administrative and

14  educational expenses shall be transferred to the board.

15         3.  The portion earmarked for disability benefits shall

16  be transferred to the division department.

17         (8)  ADMINISTRATION OF PROGRAM.--

18         (a)  The Public Employee Optional Retirement Program

19  shall be administered by the state board and affected

20  employers. The board is authorized to require oaths, by

21  affidavit or otherwise, and acknowledgments from persons in

22  connection with the administration of its duties and

23  responsibilities under this chapter. No oath, by affidavit or

24  otherwise, shall be required of an employee participant at the

25  time of election. Acknowledgment of an employee's election to

26  participate in the program shall be no greater than necessary

27  to confirm the employee's election. The board shall adopt

28  rules establishing the role and responsibilities of affected

29  state, local government, and education-related employers, the

30  state board, the department, and third-party contractors in

31  administering the Public Employee Optional Retirement Program.

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 1  The division department shall adopt rules necessary to

 2  implement the optional program in coordination with the

 3  defined benefit retirement program and the disability benefits

 4  available under the optional program.

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

 6  one third-party administrator to provide administrative

 7  services if those services cannot be competitively and

 8  contractually provided by the division of Retirement within

 9  the Department of Management Services. With the approval of

10  the state board, the third-party administrator may subcontract

11  with other organizations or individuals to provide components

12  of the administrative services. As a cost of administration,

13  the board may compensate any such contractor for its services,

14  in accordance with the terms of the contract, as is deemed

15  necessary or proper by the board. The third-party

16  administrator may not be an approved provider or be affiliated

17  with an approved provider.

18         2.  These administrative services may include, but are

19  not limited to, enrollment of eligible employees, collection

20  of employer contributions, disbursement of such contributions

21  to approved providers in accordance with the allocation

22  directions of participants; services relating to consolidated

23  billing; individual and collective recordkeeping and

24  accounting; asset purchase, control, and safekeeping; and

25  direct disbursement of funds to and from the third-party

26  administrator, the division, the board, employers,

27  participants, approved providers, and beneficiaries. This

28  section does not prevent or prohibit a bundled provider from

29  providing any administrative or customer service, including

30  accounting and administration of individual participant

31  benefits and contributions; individual participant

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 1  recordkeeping; asset purchase, control, and safekeeping;

 2  direct execution of the participant's instructions as to asset

 3  and contribution allocation; calculation of daily net asset

 4  values; direct access to participant account information; or

 5  periodic reporting to participants, at least quarterly, on

 6  account balances and transactions, if these services are

 7  authorized by the board as part of the contract.

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

 9  or more organizations to provide educational services. With

10  approval of the board, the organizations may subcontract with

11  other organizations or individuals to provide components of

12  the educational services. As a cost of administration, the

13  board may compensate any such contractor for its services in

14  accordance with the terms of the contract, as is deemed

15  necessary or proper by the board. The education organization

16  may not be an approved provider or be affiliated with an

17  approved provider.

18         4.  Educational services shall be designed by the board

19  and department to assist employers, eligible employees,

20  participants, and beneficiaries in order to maintain

21  compliance with United States Department of Labor regulations

22  under s. 404(c) of the Employee Retirement Income Security Act

23  of 1974 and to assist employees in their choice of defined

24  benefit or defined contribution retirement alternatives.

25  Educational services include, but are not limited to,

26  disseminating educational materials; providing retirement

27  planning education; explaining the differences between the

28  defined benefit retirement plan and the defined contribution

29  retirement plan; and offering financial planning guidance on

30  matters such as investment diversification, investment risks,

31  investment costs, and asset allocation. An approved provider

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 1  may also provide educational information, including retirement

 2  planning and investment allocation information concerning its

 3  products and services.

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

 5  administrator, the board shall establish criteria under which

 6  it shall consider the relative capabilities and qualifications

 7  of each proposed administrator. In developing such criteria,

 8  the board shall consider:

 9         a.  The administrator's demonstrated experience in

10  providing administrative services to public or private sector

11  retirement systems.

12         b.  The administrator's demonstrated experience in

13  providing daily valued recordkeeping to defined contribution

14  plans.

15         c.  The administrator's ability and willingness to

16  coordinate its activities with the Florida Retirement System

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

18  employers, the board, and the division the information and

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

20  management reports, quarterly participant reports, and ad hoc

21  reports requested by the department or board.

22         d.  The cost-effectiveness and levels of the

23  administrative services provided.

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

25  participants, the employers, the board, the division, and the

26  providers; the means by which participants may access account

27  information, direct investment of contributions, make changes

28  to their accounts, transfer moneys between available

29  investment vehicles, and transfer moneys between investment

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

31  

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 1         f.  Any other factor deemed necessary by the Trustees

 2  of the State Board of Administration.

 3         g.  The recommendations of the Public Employee Optional

 4  Retirement Program Advisory Committee established in

 5  subsection (12).

 6         2.  In evaluating and selecting an educational

 7  provider, the board shall establish criteria under which it

 8  shall consider the relative capabilities and qualifications of

 9  each proposed educational provider. In developing such

10  criteria, the board shall consider:

11         a.  Demonstrated experience in providing educational

12  services to public or private sector retirement systems.

13         b.  Ability and willingness to coordinate its

14  activities with the Florida Retirement System employers, the

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

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

17  including, but not limited to, reports on educational

18  contacts.

19         c.  The cost-effectiveness and levels of the

20  educational services provided.

21         d.  Ability to provide educational services via

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

23  personal contact, seminars, brochures, and newsletters.

24         e.  Any other factor deemed necessary by the Trustees

25  of the State Board of Administration.

26         f.  The recommendations of the Public Employee Optional

27  Retirement Program Advisory Committee established in

28  subsection (12).

29         3.  The establishment of the criteria shall be solely

30  within the discretion of the board.

31  

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

 2  professional services, including legal, consulting,

 3  accounting, and actuarial services, deemed necessary to

 4  implement and administer the optional program by the Trustees

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

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

 7  investment advice to participants, supplemental to education

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

 9  such contract shall be paid by those participants who choose

10  to use the services of the vendor.

11         2.  The department may contract with consultants for

12  professional services, including legal, consulting,

13  accounting, and actuarial services, deemed necessary to

14  implement and administer the optional program in coordination

15  with the defined benefit program of the Florida Retirement

16  System. The department, in coordination with the board, may

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

18  order to coordinate services common to the various programs

19  within the Florida Retirement System.

20         (9)  INVESTMENT OPTIONS OR PRODUCTS; PERFORMANCE

21  REVIEW.--

22         (c)  In evaluating and selecting approved providers and

23  products, the board shall establish criteria under which it

24  shall consider the relative capabilities and qualifications of

25  each proposed provider company and product. In developing such

26  criteria, the board shall consider the following to the extent

27  such factors may be applied in connection with investment

28  products, services, or providers:

29         1.  Experience in the United States providing

30  retirement products and related financial services under

31  defined contribution retirement plans.

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 1         2.  Financial strength and stability which shall be

 2  evidenced by the highest ratings assigned by nationally

 3  recognized rating services when comparing proposed providers

 4  that are so rated.

 5         3.  Intrastate and interstate portability of the

 6  product offered, including early withdrawal options.

 7         4.  Compliance with the Internal Revenue Code.

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

 9  the levels of service supporting the product relative to its

10  benefits and its characteristics, including, without

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

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

13  coordinate its activities with Florida Retirement System

14  employers, the division department, and the board, and to

15  supply to such employers, the division department, and the

16  board the information and data they require.

17         7.  The methods available to participants to interact

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

19  access account information, direct investment of

20  contributions, make changes to their accounts, transfer moneys

21  between available investment vehicles, and transfer moneys

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

23  activities.

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

25  transfer of individual account balances, contributions, and

26  earnings thereon, both internally among investment products

27  offered by the provider company and externally between

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

29  or penalties that may be applied.

30         9.  An evaluation of specific investment products,

31  taking into account each product's experience in meeting its

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 1  investment return objectives net of all related fees,

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

 3  investment management fees, loads, distribution and marketing

 4  fees, custody fees, recordkeeping fees, education fees,

 5  annuity expenses, and consulting fees.

 6         10.  Organizational factors, including, but not limited

 7  to, financial solvency, organizational depth, and experience

 8  in providing institutional and retail investment services.

 9         (10)  EDUCATION COMPONENT.--

10         (a)  The board, in coordination with the department,

11  shall provide for an education component for system members in

12  a manner consistent with the provisions of this section. The

13  education component must be available to eligible employees at

14  least 90 days prior to the beginning date of the election

15  period for the employees of the respective types of employers.

16         (c)  The board, in coordination with the department,

17  shall provide for an initial and ongoing transfer education

18  component to provide system members with information necessary

19  to make informed plan choice decisions. The transfer education

20  component must include, but is not limited to, information on:

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

22  transfer to the defined contribution program.

23         2.  The features of and differences between the defined

24  benefit program and the defined contribution program, both

25  generally and specifically, as those differences may affect

26  the member.

27         3.  The expected benefit available if the member were

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

29  appropriate alternative sets of assumptions.

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

31  contribution program and the period of time over which such

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

 2  expected monthly benefit payable to the member under the

 3  defined benefit program.

 4         5.  The historical rates of return for the investment

 5  alternatives available in the defined contribution programs.

 6         6.  The benefits and historical rates of return on

 7  investments available in a typical deferred compensation plan

 8  or a typical plan under s. 403(b) of the Internal Revenue Code

 9  for which the employee may be eligible.

10         7.  The program choices available to employees of the

11  State University System and the comparative benefits of each

12  available program, if applicable.

13         8.  Payout options available in each of the retirement

14  programs.

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

16  a communication component to provide program information to

17  participating employers and the employers' personnel and

18  payroll officers and to explain their respective

19  responsibilities in conjunction with the retirement programs.

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

21  shall ensure that each participant is provided a quarterly

22  statement that accounts for the contributions made on behalf

23  of such participant; the interest and investment earnings

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

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

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

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

28  of the current quarter and previous quarter.

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

30  changes in account accumulation unit values for the period.

31         (d)  Itemize account contributions for the quarter.

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

 2  contribution levels, reallocation of contributions, balance

 3  transfers, or withdrawals.

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

 5  deductions that apply to the account.

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

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

 8  which the participant is not vested.

 9         (h)  Indicate each investment product's performance

10  relative to an appropriate market benchmark.

11  

12  The third-party administrator shall provide quarterly and

13  annual summary reports to the board and any other reports

14  requested by the department or the board. In any solicitation

15  or offer of coverage under an optional retirement program, a

16  provider company shall be governed by the contract readability

17  provisions of s. 627.4145, notwithstanding s. 627.4145(6)(c).

18  In addition, all descriptive materials must be prepared under

19  the assumption that the participant is an unsophisticated

20  investor. Provider companies must maintain an internal system

21  of quality assurance, have proven functional systems that are

22  date-calculation compliant, and be subject to a due-diligence

23  inquiry that proves their capacity and fitness to undertake

24  service responsibilities.

25         (19)  PARTICIPANT RECORDS.--All personal identifying

26  information regarding a participant in the Public Employee

27  Optional Retirement Program contained in Florida Retirement

28  System records held by the State Board of Administration or

29  the Department of Management Services, or its their agents,

30  employees, or contractors is exempt from the provisions of s.

31  119.07(1) and s. 24(a), Art. I of the State Constitution. The

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 1  department or board may use such exempt information as

 2  necessary in any legal or administrative proceeding. This

 3  subsection is subject to the Open Government Sunset Review Act

 4  of 1995 in accordance with s. 119.15, and shall stand repealed

 5  October 2, 2007, unless reviewed and saved from repeal through

 6  reenactment by the Legislature.

 7         Section 42.  Section 121.4503, Florida Statutes, is

 8  amended to read:

 9         121.4503  Florida Retirement System Contributions

10  Clearing Trust Fund.--

11         (1)  The Florida Retirement System Contributions

12  Clearing Trust Fund is created in the State Treasury as a

13  clearing fund for disbursing employer contributions to the

14  component plans of the Florida Retirement System and shall be

15  administered by the State Board of Administration Department

16  of Management Services. Funds shall be credited to the trust

17  fund as provided in this chapter and shall be held in trust

18  for the contributing employers until such time as the assets

19  are transferred by the board department to the Florida

20  Retirement System Trust Fund, the Public Employee Optional

21  Retirement Program Trust Fund, or other trust funds as

22  authorized by law, to be used for the purposes of this

23  chapter. The trust fund is exempt from the service charges

24  imposed by s. 215.20.

25         (2)  The Florida Retirement System Contributions

26  Clearing Trust Fund is a clearing trust fund of the State

27  Board of Administration Department of Management Services

28  pursuant to s. 19(f), Art. III of the State Constitution, and

29  is not subject to termination.

30         (3)  The State Board of Administration Department of

31  Management Services may adopt rules governing the receipt and

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 1  disbursement of amounts received by the Florida Retirement

 2  System Contributions Clearing Trust Fund from employers

 3  contributing to the component plans of the Florida Retirement

 4  System.

 5         Section 43.  Section 121.591, Florida Statutes, is

 6  amended to read:

 7         121.591  Benefits payable under the Public Employee

 8  Optional Retirement Program of the Florida Retirement

 9  System.--Benefits may not be paid under this section unless

10  the member has terminated employment as provided in s.

11  121.021(39)(a) or is deceased and a proper application has

12  been filed in the manner prescribed by the state board or the

13  division department. The state board or division department,

14  as appropriate, may cancel an application for retirement

15  benefits when the member or beneficiary fails to timely

16  provide the information and documents required by this chapter

17  and the rules of the state board and division department. In

18  accordance with their respective responsibilities as provided

19  herein, the State Board of Administration and the division

20  Department of Management Services shall adopt rules

21  establishing procedures for application for retirement

22  benefits and for the cancellation of such application when the

23  required information or documents are not received.

24         (1)  NORMAL BENEFITS.--Under the Public Employee

25  Optional Retirement Program:

26         (a)  Benefits in the form of vested accumulations as

27  described in s. 121.4501(6) shall be payable under this

28  subsection in accordance with the following terms and

29  conditions:

30         1.  To the extent vested, benefits shall be payable

31  only to a participant.

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

 2  administrator or designated approved providers in accordance

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

 4  policy.

 5         3.  To receive benefits under this subsection, the

 6  participant must be terminated from all employment with all

 7  Florida Retirement System employers, as provided in s.

 8  121.021(39).

 9         (b)  If a participant elects to receive his or her

10  benefits upon termination of employment, the participant must

11  submit a written application to the third-party administrator

12  indicating his or her preferred distribution date and

13  selecting an authorized method of distribution as provided in

14  paragraph (c). The participant may defer receipt of benefits

15  until he or she chooses to make such application, subject to

16  federal requirements.

17         (c)  Upon receipt by the third-party administrator of a

18  properly executed application for distribution of benefits,

19  the total accumulated benefit shall be payable to the

20  participant, as:

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

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

23  accrued benefits, plus interest and investment earnings, are

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

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

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

27         3.  Periodic distributions, as authorized by the state

28  board.

29         (2)  DISABILITY RETIREMENT BENEFITS.--Benefits provided

30  under this subsection are payable in lieu of the benefits

31  which would otherwise be payable under the provisions of

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 1  subsection (1). Such benefits shall be funded entirely from

 2  employer contributions made under s. 121.571, transferred

 3  participant funds accumulated pursuant to paragraph (a), and

 4  interest and earnings thereon. Pursuant thereto:

 5         (a)  Transfer of funds.--To qualify to receive monthly

 6  disability benefits under this subsection:

 7         1.  All moneys accumulated in the participant's Public

 8  Employee Optional Retirement Program accounts, including

 9  vested and nonvested accumulations as described in s.

10  121.4501(6), shall be transferred from such individual

11  accounts to the Division of Retirement for deposit in the

12  disability account of the Florida Retirement System Trust

13  Fund. Such moneys shall be separately accounted for. Earnings

14  shall be credited on an annual basis for amounts held in the

15  disability accounts of the Florida Retirement System Trust

16  Fund based on actual earnings of the Florida Retirement System

17  Trust Fund.

18         2.  If the participant has retained retirement credit

19  he or she had earned under the defined benefit program of the

20  Florida Retirement System as provided in s. 121.4501(3)(b), a

21  sum representing the actuarial present value of such credit

22  within the Florida Retirement System Trust Fund shall be

23  reassigned by the Division of Retirement from the defined

24  benefit program to the disability program as implemented under

25  this subsection and shall be deposited in the disability

26  account of the Florida Retirement System Trust Fund. Such

27  moneys shall be separately accounted for.

28         (b)  Disability retirement; entitlement.--

29         1.  A participant of the Public Employee Optional

30  Retirement Program who becomes totally and permanently

31  disabled, as defined in s. 121.091(4)(b), after completing 8

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 1  years of creditable service, or a participant who becomes

 2  totally and permanently disabled in the line of duty

 3  regardless of his or her length of service, shall be entitled

 4  to a monthly disability benefit as provided herein.

 5         2.  In order for service to apply toward the 8 years of

 6  service required to vest for regular disability benefits, or

 7  toward the creditable service used in calculating a

 8  service-based benefit as provided for under paragraph (g), the

 9  service must be creditable service as described below:

10         a.  The participant's period of service under the

11  Public Employee Optional Retirement Program will be considered

12  creditable service, except as provided in subparagraph d.

13         b.  If the participant has elected to retain credit for

14  his or her service under the defined benefit program of the

15  Florida Retirement System as provided under s. 121.4501(3)(b),

16  all such service will be considered creditable service.

17         c.  If the participant has elected to transfer to his

18  or her participant accounts a sum representing the present

19  value of his or her retirement credit under the defined

20  benefit program as provided under s. 121.4501(3)(c), the

21  period of service under the defined benefit program

22  represented in the present value amounts transferred will be

23  considered creditable service for purposes of vesting for

24  disability benefits, except as provided in subparagraph d.

25         d.  Whenever a participant has terminated employment

26  and has taken distribution of his or her funds as provided in

27  subsection (1), all creditable service represented by such

28  distributed funds is forfeited for purposes of this

29  subsection.

30         (c)  Disability retirement effective date.--The

31  effective retirement date for a participant who applies and is

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 1  approved for disability retirement shall be established as

 2  provided under s. 121.091(4)(a)2. and 3.

 3         (d)  Total and permanent disability.--A participant

 4  shall be considered totally and permanently disabled if, in

 5  the opinion of the division, he or she is prevented, by reason

 6  of a medically determinable physical or mental impairment,

 7  from rendering useful and efficient service as an officer or

 8  employee.

 9         (e)  Proof of disability.--The division, before

10  approving payment of any disability retirement benefit, shall

11  require proof that the participant is totally and permanently

12  disabled in the same manner as provided for members of the

13  defined benefit program of the Florida Retirement System under

14  s. 121.091(4)(c).

15         (f)  Disability retirement benefit.--Upon the

16  disability retirement of a participant under this subsection,

17  the participant shall receive a monthly benefit that shall

18  begin to accrue on the first day of the month of disability

19  retirement, as approved by the division, and shall be payable

20  on the last day of that month and each month thereafter during

21  his or her lifetime and continued disability. All disability

22  benefits payable to such member shall be paid out of the

23  disability account of the Florida Retirement System Trust Fund

24  established under this subsection.

25         (g)  Computation of disability retirement benefit.--The

26  amount of each monthly payment shall be calculated in the same

27  manner as provided for members of the defined benefit program

28  of the Florida Retirement System under s. 121.091(4)(f). For

29  such purpose, creditable service under both the defined

30  benefit program and the Public Employee Optional Retirement

31  

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 1  Program of the Florida Retirement System shall be applicable

 2  as provided under paragraph (b).

 3         (h)  Reapplication.--A participant whose initial

 4  application for disability retirement has been denied may

 5  reapply for disability benefits in the same manner, and under

 6  the same conditions, as provided for members of the defined

 7  benefit program of the Florida Retirement System under s.

 8  121.091(4)(g).

 9         (i)  Membership.--Upon approval of an application for

10  disability benefits under this subsection, the applicant shall

11  be transferred to the defined benefit program of the Florida

12  Retirement System, effective upon his or her disability

13  retirement effective date.

14         (j)  Option to cancel.--Any participant whose

15  application for disability benefits is approved may cancel his

16  or her application for disability benefits, provided that the

17  cancellation request is received by the division before a

18  disability retirement warrant has been deposited, cashed, or

19  received by direct deposit. Upon such cancellation:

20         1.  The participant's transfer to the defined benefit

21  program under paragraph (i) shall be nullified;

22         2.  The participant shall be retroactively reinstated

23  in the Public Employee Optional Retirement Program without

24  hiatus;

25         3.  All funds transferred to the Florida Retirement

26  System Trust Fund under paragraph (a) shall be returned to the

27  participant accounts from which such funds were drawn; and

28         4.  The participant may elect to receive the benefit

29  payable under the provisions of subsection (1) in lieu of

30  disability benefits as provided under this subsection.

31         (k)  Recovery from disability.--

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 1         1.  The division may require periodic reexaminations at

 2  the expense of the disability program account of the Florida

 3  Retirement System Trust Fund. Except as otherwise provided in

 4  subparagraph 2., the requirements, procedures, and

 5  restrictions relating to the conduct and review of such

 6  reexaminations, discontinuation or termination of benefits,

 7  reentry into employment, disability retirement after reentry

 8  into covered employment, and all other matters relating to

 9  recovery from disability shall be the same as are set forth

10  under s. 121.091(4)(h).

11         2.  Upon recovery from disability, any recipient of

12  disability retirement benefits under this subsection shall be

13  a compulsory member of the Public Employee Optional Retirement

14  Program of the Florida Retirement System. The net difference

15  between the recipient's original account balance transferred

16  to the Florida Retirement System Trust Fund, including

17  earnings, under paragraph (a) and total disability benefits

18  paid to such recipient, if any, shall be determined as

19  provided in sub-subparagraph a.

20         a.  An amount equal to the total benefits paid shall be

21  subtracted from that portion of the transferred account

22  balance consisting of vested accumulations as described under

23  s. 121.4501(6), if any, and an amount equal to the remainder

24  of benefit amounts paid, if any, shall then be subtracted from

25  any remaining portion consisting of nonvested accumulations as

26  described under s. 121.4501(6).

27         b.  Amounts subtracted under sub-subparagraph a. shall

28  be retained within the disability account of the Florida

29  Retirement System Trust Fund. Any remaining account balance

30  shall be transferred to the third-party administrator for

31  

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 1  disposition as provided under sub-subparagraph c. or

 2  sub-subparagraph d., as appropriate.

 3         c.  If the recipient returns to covered employment,

 4  transferred amounts shall be deposited in individual accounts

 5  under the Public Employee Optional Retirement Program, as

 6  directed by the participant. Vested and nonvested amounts

 7  shall be separately accounted for as provided in s.

 8  121.4501(6).

 9         d.  If the recipient fails to return to covered

10  employment upon recovery from disability:

11         (I)  Any remaining vested amount shall be deposited in

12  individual accounts under the Public Employee Optional

13  Retirement Program, as directed by the participant, and shall

14  be payable as provided in subsection (1).

15         (II)  Any remaining nonvested amount shall be held in a

16  suspense account and shall be forfeitable after 5 years as

17  provided in s. 121.4501(6).

18         3.  If present value was reassigned from the defined

19  benefit program to the disability program of the Florida

20  Retirement System as provided under subparagraph (a)2., the

21  full present value amount shall be returned to the defined

22  benefit account within the Florida Retirement System Trust

23  Fund and the affected individual's associated retirement

24  credit under the defined benefit program shall be reinstated

25  in full. Any benefit based upon such credit shall be

26  calculated as provided in s. 121.091(4)(h)1.

27         (l)  Nonadmissible causes of disability.--A participant

28  shall not be entitled to receive a disability retirement

29  benefit if the disability results from any injury or disease

30  sustained or inflicted as described in s. 121.091(4)(i).

31  

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 1         (m)  Disability retirement of justice or judge by order

 2  of Supreme Court.--

 3         1.  If a participant is a justice of the Supreme Court,

 4  judge of a district court of appeal, circuit judge, or judge

 5  of a county court who has served for 6 years or more as an

 6  elected constitutional judicial officer, including service as

 7  a judicial officer in any court abolished pursuant to Art. V

 8  of the State Constitution, and who is retired for disability

 9  by order of the Supreme Court upon recommendation of the

10  Judicial Qualifications Commission pursuant to the provisions

11  of Art. V of the State Constitution, the participant's Option

12  1 monthly disability benefit amount as provided in s.

13  121.091(6)(a)1. shall be two-thirds of his or her monthly

14  compensation as of the participant's disability retirement

15  date.  Such a participant may alternatively elect to receive

16  an actuarially adjusted disability retirement benefit under

17  any other option as provided in s. 121.091(6)(a), or to

18  receive the normal benefit payable under the Public Employee

19  Optional Retirement Program as set forth in subsection (1).

20         2.  If any justice or judge who is a participant of the

21  Public Employee Optional Retirement Program of the Florida

22  Retirement System is retired for disability by order of the

23  Supreme Court upon recommendation of the Judicial

24  Qualifications Commission pursuant to the provisions of Art. V

25  of the State Constitution and elects to receive a monthly

26  disability benefit under the provisions of this paragraph:

27         a.  Any present value amount that was transferred to

28  his or her program account and all employer contributions made

29  to such account on his or her behalf, plus interest and

30  earnings thereon, shall be transferred to and deposited in the

31  

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 1  disability account of the Florida Retirement System Trust

 2  Fund; and

 3         b.  The monthly benefits payable under this paragraph

 4  for any affected justice or judge retired from the Florida

 5  Retirement System pursuant to Art. V of the State Constitution

 6  shall be paid from the disability account of the Florida

 7  Retirement System Trust Fund.

 8         (n)  Death of retiree or beneficiary.--Upon the death

 9  of a disabled retiree or beneficiary thereof who is receiving

10  monthly benefits under this subsection, the monthly benefits

11  shall be paid through the last day of the month of death and

12  shall terminate, or be adjusted, if applicable, as of that

13  date in accordance with the optional form of benefit selected

14  at the time of retirement. The deceased disabled retiree's

15  beneficiary shall also receive the amount of the participant's

16  remaining account balance, if any, in the Florida Retirement

17  System Trust Fund. The Division of Retirement Department of

18  Management Services may adopt rules necessary to administer

19  this paragraph.

20         (3)  DEATH BENEFITS.--Under the Public Employee

21  Optional Retirement Program:

22         (a)  Survivor benefits shall be payable in accordance

23  with the following terms and conditions:

24         1.  To the extent vested, benefits shall be payable

25  only to a participant's beneficiary or beneficiaries as

26  designated by the participant. If a participant designates a

27  primary beneficiary other than the participant's spouse, the

28  participant's spouse shall be notified of the designation.

29  This requirement shall not apply to the designation of one or

30  more contingent beneficiaries to receive any benefits

31  

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 1  remaining upon the death of the primary beneficiary or

 2  beneficiaries.

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

 4  administrator or designated approved providers in accordance

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

 6  policy.

 7         3.  To receive benefits under this subsection, the

 8  participant must be deceased.

 9         (b)  In the event of a participant's death, all vested

10  accumulations as described in s. 121.4501(6), less withholding

11  taxes remitted to the Internal Revenue Service, shall be

12  distributed, as provided in paragraph (c), to the

13  participant's designated beneficiary or beneficiaries, or to

14  the participant's estate, as if the participant retired on the

15  date of death. No other death benefits shall be available for

16  survivors of participants under the Public Employee Optional

17  Retirement Program, except for such benefits, or coverage for

18  such benefits, as are otherwise provided by law or are

19  separately afforded by the employer, at the employer's

20  discretion.

21         (c)  Upon receipt by the third-party administrator of a

22  properly executed application for distribution of benefits,

23  the total accumulated benefit shall be payable by the

24  third-party administrator to the participant's surviving

25  beneficiary or beneficiaries, as:

26         1.  A lump-sum distribution payable to the beneficiary

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

28         2.  An eligible rollover distribution on behalf of the

29  surviving spouse of a deceased participant, whereby all

30  accrued benefits, plus interest and investment earnings, are

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

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 1  custodian of an eligible retirement plan, as described in s.

 2  402(c)(8)(B) of the Internal Revenue Code, on behalf of the

 3  surviving spouse; or

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

 5  accrued benefit is paid to the deceased participant's

 6  surviving spouse or other designated beneficiaries, less

 7  withholding taxes remitted to the Internal Revenue Service,

 8  and the remaining amount is transferred directly to the

 9  custodian of an eligible retirement plan, as described in s.

10  402(c)(8)(B) of the Internal Revenue Code, on behalf of the

11  surviving spouse. The proportions must be specified by the

12  participant or the surviving beneficiary.

13  

14  This paragraph does not abrogate other applicable provisions

15  of state or federal law providing for payment of death

16  benefits.

17         (4)  LIMITATION ON LEGAL PROCESS.--The benefits payable

18  to any person under the Public Employee Optional Retirement

19  Program, and any contributions accumulated under such program,

20  are not subject to assignment, execution, attachment, or any

21  legal process, except for qualified domestic relations orders

22  by a court of competent jurisdiction, income deduction orders

23  as provided in s. 61.1301, and federal income tax levies.

24         Section 44.  Section 121.5911, Florida Statutes, is

25  amended to read:

26         121.5911  Disability retirement program; qualified

27  status; rulemaking authority.--It is the intent of the

28  Legislature that the disability retirement program for

29  participants of the Public Employee Optional Retirement

30  Program as created in this act must meet all applicable

31  requirements of federal law for a qualified plan.  The

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 1  Department of Management Services or the Division of

 2  Retirement shall seek a private letter ruling from the

 3  Internal Revenue Service on the disability retirement program

 4  for participants of the Public Employee Optional Retirement

 5  Program. Consistent with the private letter ruling, the

 6  division Department of Management Services shall adopt any

 7  necessary rules required to maintain the qualified status of

 8  the disability retirement program and the Florida Retirement

 9  System defined benefit plan.

10         Section 45.  Subsection (1) of section 121.72, Florida

11  Statutes, is amended to read:

12         121.72  Allocations to optional retirement program

13  participant accounts; percentage amounts.--

14         (1)  The allocations established in subsection (4)

15  shall fund retirement benefits under the optional retirement

16  program and shall be transferred monthly by the State Board of

17  Administration Division of Retirement from the Florida

18  Retirement System Contributions Clearing Trust Fund to the

19  third-party administrator for deposit in each participating

20  employee's individual account based on the membership class of

21  the participant.

22         Section 46.  Subsection (1) of section 121.73, Florida

23  Statutes, is amended to read:

24         121.73  Allocations for optional retirement program

25  participant disability coverage; percentage amounts.--

26         (1)  The allocations established in subsection (3)

27  shall be used to provide disability coverage for participants

28  in the optional retirement program and shall be transferred

29  monthly by the State Board of Administration Division of

30  Retirement from the Florida Retirement System Contributions

31  

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 1  Clearing Trust Fund to the disability account of the Florida

 2  Retirement System Trust Fund.

 3         Section 47.  Section 121.74, Florida Statutes, is

 4  amended to read:

 5         121.74  Administrative and educational

 6  expenses.--Effective July 1, 2003, in addition to

 7  contributions required under s. 121.71, employers

 8  participating in the Florida Retirement System shall

 9  contribute an amount equal to 0.10 percent of the payroll

10  reported for each class or subclass of Florida Retirement

11  System membership, which amount shall be transferred by the

12  State Board of Administration Division of Retirement from the

13  Florida Retirement System Contributions Clearing Trust Fund to

14  the board's State Board of Administration's Administrative

15  Trust Fund to offset the costs of administering the optional

16  retirement program and the costs of providing educational

17  services to participants in the defined benefit program and

18  the optional retirement program. Approval of the Trustees of

19  the State Board of Administration is required prior to the

20  expenditure of these funds. Payments for third-party

21  administrative or educational expenses shall be made only

22  pursuant to the terms of the approved contracts for such

23  services.

24         Section 48.  Subsections (1) and (6) of section 122.02,

25  Florida Statutes, are amended to read:

26         122.02  Definitions.--The following words and phrases

27  as used in this chapter shall have the following meaning

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

29         (1)  "State and county officers and employees" shall

30  include all full-time officers or employees who receive

31  compensation for services rendered from state or county funds,

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 1  or from funds of drainage districts or mosquito control

 2  districts of a county or counties, or from funds of the State

 3  Board of Administration or from funds of closed bank

 4  receivership accounts or from funds of any state institution

 5  or who receive compensation for employment or service from any

 6  agency, branch, department, institution or board of the state,

 7  or any county of the state, for service rendered the state or

 8  county from funds from any source provided for their

 9  employment or service regardless of whether the same is paid

10  by state or county warrant or not; provided that such

11  compensation in whatever form paid shall be specified in terms

12  of fixed monthly salaries by the employing state or county

13  agency or state or county official and shall not include

14  amounts allowed for professional employees for special or

15  particular service or for subsistence or travel expenses;

16  provided further the division department shall prescribe

17  appropriate procedure for contribution deduction out of such

18  compensation in accordance with the provisions of this

19  chapter, provided further that such officers and employees

20  defined herein shall not include those officers and employees

21  excepted from the provisions by s. 122.18 of this law.

22         (6)  "Division" means the Division of Retirement of the

23  State Board of Administration "Department" means the

24  Department of Management Services.

25         Section 49.  Paragraph (d) of subsection (6) and

26  subsection (9) of section 122.03, Florida Statutes, are

27  amended to read:

28         122.03  Contributions; participants; prior service

29  credit.--

30         (6)  Any officer or employee who held office or was

31  employed by the state or a county of the state continuously

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 1  from May 1, 1959, and who has not previously received credit

 2  for, or is not eligible to claim credit for, prior years of

 3  service under subsection (2); or any officer or employee who

 4  holds office or is employed by the state or a county of the

 5  state on June 1, 1961, and is continuously employed; or any

 6  officer or employee who holds office or is employed by the

 7  state or county of the state after June 1, 1961, and who is

 8  continuously employed for 3 years, during which period of time

 9  no back payments may be made:

10         (d)  Prior service allowance may be made only for those

11  periods in which state or county records of service and salary

12  are available, or at least three affidavits and such other

13  information as might be required by the division department to

14  meet the provisions of this law.

15         (9)  The surviving spouse or other dependent of any

16  member whose employment is terminated by death shall, upon

17  application to the division department, be permitted to pay

18  the required contributions for any service performed by the

19  member which could have been claimed by the member at the time

20  of death. Such service shall be added to the creditable

21  service of the member and shall be used in the calculation of

22  any benefits which may be payable to the surviving spouse or

23  other surviving dependent.

24         Section 50.  Subsection (2) of section 122.05, Florida

25  Statutes, is amended to read:

26         122.05  Legislator services included.--

27         (2)  The division department and state officials

28  administering such said retirement system shall make the

29  contribution deductions required by law from the compensation

30  hereafter received by any of the said participating members of

31  

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 1  the Legislature for service rendered the State Legislature in

 2  the same manner as in the case of other state employment.

 3         Section 51.  Subsection (2) of section 122.06, Florida

 4  Statutes, is amended to read:

 5         122.06  Legislative employee services included.--

 6         (2)  The division department and other state officials

 7  administering such said retirement system shall make the

 8  contribution deductions required by law from the compensation

 9  hereafter received by any of the such said participating

10  attaches for service rendered the State Legislature in the

11  same manner as in the case of other state employment.

12         Section 52.  Subsection (2) of section 122.07, Florida

13  Statutes, is amended to read:

14         122.07  Seasonal state employment included; time limit

15  and procedure for claiming.--

16         (2)  Any state employee as described in subsection (1)

17  in the classification set forth in s. 122.01 may elect to

18  receive credit as a state employee under the State and County

19  Officers and Employees' Retirement System by providing to the

20  division department a statement from the state in which he or

21  she was employed, listing days employed and monthly earnings

22  and such other information as may, in the opinion of the

23  division department, be necessary or appropriate in the

24  carrying out of this section. Credit shall be granted upon

25  payment to the division department by such employee of an

26  amount equal to the total retirement contribution that would

27  have been required had the member worked in this state during

28  the period based on the salary drawn by such employee during

29  his or her last full month of employment by the state or any

30  department thereof for each month during said fiscal year for

31  which such employee was not employed by the state or any

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 1  department thereof, but was employed by some other state, plus

 2  interest compounded annually each June 30 from the date of the

 3  service in another state to the date of payment at the rate of

 4  4 percent until July 1, 1975, and 6.5 percent thereafter.  The

 5  member shall have until his or her date of retirement to claim

 6  and purchase credit for such employment in another state.

 7         Section 53.  Paragraph (a) of subsection (1), paragraph

 8  (b) of subsection (4), and subsections (5) and (9) of section

 9  122.08, Florida Statutes, are amended to read:

10         122.08  Requirements for retirement;

11  classifications.--There shall be two retirement

12  classifications for all state and county officers and

13  employees participating herein as hereafter provided in this

14  section:

15         (1)(a)  Any state or county officer or employee who has

16  attained normal retirement age, which shall be age 60 for a

17  person who had become a member prior to July 1, 1963, and age

18  62 for a person who had or shall become a member on or after

19  July 1, 1963, and has accumulated at least 10 years' service

20  in the aggregate within the contemplation of this law, and who

21  has made or makes contributions to the State and County

22  Officers and Employees' Retirement Trust Fund for 5 or more

23  years as prescribed in this law, may voluntarily retire from

24  office or employment and be entitled to receive retirement

25  compensation, the amount of which shall be 2 percent for each

26  year of service rendered, based upon the average final

27  compensation, payable in equal monthly installments, upon his

28  or her own requisition.  Requisition requirements shall be set

29  by the division department.

30         (4)

31  

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 1         (b)  A member who elects an option in paragraph (a)

 2  shall on a form provided for that purpose designate his or her

 3  spouse as beneficiary to receive the benefits which continue

 4  to be payable upon the death of the member.  After such

 5  benefits have commenced under an option in paragraph (a), the

 6  retired member may change the designation of his or her spouse

 7  as beneficiary only twice.  If such a retired member remarries

 8  and wishes to make such a change, he or she may do so by

 9  filing with the division department a notarized change of

10  spouse designation form and shall notify the former spouse in

11  writing of such change. Upon receipt of a completed change of

12  spouse designation form, the division department shall adjust

13  the member's monthly benefit by the application of actuarial

14  tables and calculations developed to ensure that the benefit

15  paid is the actuarial equivalent of the present value of the

16  member's current benefit. The consent of a retired member's

17  formerly designated spouse as beneficiary to any such change

18  shall not be required.

19         (5)  Tables for computing the actuarial equivalent

20  shall be approved by the division department.

21         (9)  Notwithstanding any other provision in this

22  chapter to the contrary, the following provisions shall apply

23  to any officer or employee who has accumulated at least 10

24  years of service and dies:

25         (a)  If the deceased member's surviving spouse has

26  previously received a refund of the member's contributions

27  made to the retirement trust fund, such spouse may pay to the

28  division department an amount equal to the sum of the amount

29  of the deceased member's contributions previously refunded and

30  interest at 3 percent compounded annually on the amount of

31  such refunded contributions from the date of refund until July

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 1  1, 1975, and thereafter at the rate of 6.5 percent interest

 2  compounded annually to the date of payment to the division

 3  department, and by so doing be entitled to receive the monthly

 4  retirement benefit provided in paragraph (c).

 5         (b)  If the deceased member's surviving spouse has not

 6  received a refund of the deceased member's contributions, such

 7  spouse shall, upon application to the division department,

 8  receive the monthly retirement benefit provided in paragraph

 9  (c).

10         (c)  The monthly benefit payable to the spouse

11  described in paragraph (a) or paragraph (b) shall be the

12  amount which would have been payable to the deceased member's

13  spouse, assuming that the member retired on the date of death

14  and had selected the option in subsection (4) which would

15  afford the surviving spouse the greatest amount of benefits,

16  such benefit to be based on the ages of the spouse and member

17  as of the date of death of the member.  Such benefit shall

18  commence on the first day of the month following the payment

19  of the aforesaid amount to the division department, if

20  paragraph (a) is applicable, or on the first day of the month

21  following the receipt of the spouse's application by the

22  division department, if paragraph (b) is applicable.

23         Section 54.  Section 122.09, Florida Statutes, is

24  amended to read:

25         122.09  Disability retirement; medical

26  examinations.--Whenever any officer or employee of the state

27  or county of the state has service credit as such officer or

28  employee for 10 years within the contemplation of this law,

29  the last 5 years of which, except for a single break not to

30  exceed 1 year, must be continuous, unbroken service and who is

31  regularly contributing to the State and County Officers and

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 1  Employees' Retirement Trust Fund and shall while holding such

 2  office or employment become permanently and totally disabled,

 3  physically or mentally, or both, from rendering useful and

 4  efficient service as such officer or employee, such officer or

 5  employee may retire from his or her office or employment, and

 6  upon such retirement the officer or employee shall be paid, so

 7  long as the permanent and total disability continues, on his

 8  or her own monthly requisition, from the State and County

 9  Officers and Employees' Retirement Trust Fund hereinafter

10  established, retirement compensation as provided in s. 122.08;

11  provided that no officer or employee retiring under this

12  section shall receive less than 50 percent of his or her

13  average final compensation not to exceed $75.  No officer or

14  employee of the state and county of the state shall be

15  permitted to retire under the provisions of this section until

16  examined by a duly qualified physician or surgeon or board of

17  physicians and surgeons, to be selected by the Governor for

18  that purpose, and found to be disabled in the degree and in

19  the manner specified in this section.  Any officer or employee

20  retiring under this section shall be examined periodically by

21  a duly qualified physician or surgeon or board of physicians

22  and surgeons to be selected by the Governor for that purpose

23  and paid from the retirement trust fund herein provided for,

24  at such time as the division Department of Management Services

25  shall direct to determine if such total disability has

26  continued and in the event it be disclosed by said examination

27  that said total disability has ceased to exist, then such

28  officer or employee shall forthwith cease to be paid benefits

29  under this section.  Reference to s. 122.08 is for the purpose

30  of computing benefits only.  Any person heretofore retired

31  under this section shall be eligible to qualify for the

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 1  minimum benefits provided herein; however, minimum benefits

 2  shall not be paid retroactively.

 3         Section 55.  Subsection (4) of section 122.10, Florida

 4  Statutes, is amended to read:

 5         122.10  Separation from service; refund of

 6  contributions.--

 7         (4)  Should any officer or employee elect to receive a

 8  refund as provided in this section, his or her application for

 9  refund shall be submitted in the manner prescribed by the

10  regulations adopted by the division department and shall

11  accompany the payroll certification, submitted to the division

12  department, on which he or she was last paid prior to

13  termination.  The division department shall pay the entire

14  refund due within 45 days after the first day of the month

15  subsequent to receipt of such application for refund and said

16  payroll certification.

17         Section 56.  Subsection (1) of section 122.12, Florida

18  Statutes, is amended to read:

19         122.12  Designation of beneficiary; death of

20  participant; forfeiture of contributions after benefits paid;

21  survivor benefits.--

22         (1)  Any officer or employee may file, in writing, a

23  designation of beneficiary and it shall be the duty of the

24  division department to refund 100 percent, without interest,

25  of the contributions made to the retirement trust fund by such

26  deceased officer or employee to such designated beneficiary.

27  The officer or employee shall have the privilege of changing,

28  in writing, the designated beneficiary at any time. Upon

29  failure to designate a beneficiary, the refund shall be made

30  to the persons in the same order as designated in  s. 222.15,

31  for wages due deceased employees.  If the deceased officer or

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 1  employee has received any benefits under this law, no refund

 2  shall be made unless such officer or employee has elected to

 3  accept benefits under s. 122.08(3) or (4).

 4         Section 57.  Section 122.13, Florida Statutes, is

 5  amended to read:

 6         122.13  Administration of law; appropriation.--The

 7  division department shall make such rules as are necessary for

 8  the effective administration of this chapter, and the cost is

 9  hereby annually appropriated and shall be paid into the State

10  and County Officers and Employees' Retirement Trust Fund out

11  of the Intangible Tax Fund in the State Treasury in the amount

12  necessary to administer efficiently the state and county

13  retirement law.  At the end of each fiscal year, beginning

14  with fiscal year 1959-1960, the administrative cost of the

15  state and county retirement system for the fiscal year just

16  ended shall be refunded to the General Revenue Fund from

17  interest earned on investments made subsequent to June 30,

18  1959.

19         Section 58.  Subsection (2) of section 122.15, Florida

20  Statutes, is amended to read:

21         122.15  Benefits exempt from taxes and execution.--

22         (2)  This subsection shall have no effect upon this

23  section except that the division department may, upon written

24  request from the retired member, deduct premiums for group

25  hospitalization insurance from the retirement benefit paid

26  such retired member.

27         Section 59.  Paragraph (b) of subsection (2) of section

28  122.16, Florida Statutes, is amended to read:

29         122.16  Employment after retirement.--

30         (2)

31  

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 1         (b)  Any person to whom the limitation in paragraph (a)

 2  applies who violates such reemployment limitation and is

 3  reemployed with any agency participating in the Florida

 4  Retirement System prior to completion of the 12-month

 5  limitation period shall give timely notice of this fact in

 6  writing to his or her employer and to the division department;

 7  and his or her retirement benefits shall be suspended for the

 8  balance of the 12-month limitation period.  Any person

 9  employed in violation of this subsection and any employing

10  agency which knowingly employs or appoints such person without

11  notifying the division department to suspend retirement

12  benefits shall be jointly and severally liable for

13  reimbursement to the retirement trust fund of any benefits

14  paid during the reemployment limitation period.  To avoid

15  liability, such employing agency shall have a written

16  statement from the retiree that he or she is not retired from

17  a state-administered retirement system.  Any retirement

18  benefits received by such person while he or she is reemployed

19  during this reemployment limitation period shall be repaid to

20  the retirement trust fund, and his or her retirement benefits

21  shall remain suspended until such repayment has been made. Any

22  benefits suspended beyond the reemployment limitation period

23  shall apply toward the repayment of benefits received in

24  violation of the reemployment limitation.

25         Section 60.  Subsection (3) of section 122.23, Florida

26  Statutes, is amended to read:

27         122.23  Definitions; ss. 122.21-122.321.--In addition

28  to those definitions set forth in s. 122.02 the following

29  words and phrases used in ss. 122.21-122.24, 122.26 to

30  122.321, inclusive, have the respective meanings set forth:

31  

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 1         (3)  "Division" means the Division of Retirement of the

 2  State Board of Administration "Department" means the

 3  Department of Management Services.

 4         Section 61.  Subsections (1) and (5) of section 122.30,

 5  Florida Statutes, are amended to read:

 6         122.30  Appropriations.--

 7         (1)  There is hereby annually appropriated from the

 8  intangible tax fund of the state to the division department as

 9  the state agency designated in chapter 650, a sum not to

10  exceed $10,000 to defray the expenses of such agency in

11  connection with its continuing duties in relation to the

12  social security coverage provided by this law.

13         (5)  In addition to amounts appropriated by other

14  provisions of this chapter or other laws to defray cost of

15  administration of this system, there is hereby appropriated

16  out of the Intangible Tax Fund of the state for use of the

17  division department in its administration of the two divisions

18  of this system, the sum of $100,000, or so much thereof as may

19  be required for that purpose.

20         Section 62.  Paragraphs (b) and (c) of subsection (1)

21  and subsection (11) of section 122.34, Florida Statutes, are

22  amended to read:

23         122.34  Special provisions for certain sheriffs and

24  full-time deputy sheriffs.--

25         (1)

26         (b)  Only those members who are full-time criminal law

27  enforcement officers or agents, as certified by the employing

28  authority, who perform duties according to rule, order, or

29  established custom as full-time criminal law enforcement

30  officers or agents shall be certified to the division

31  

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 1  department as high hazard members, and only such members will

 2  be approved by the division department.

 3         (c)  The division department shall make such rules as

 4  are necessary for the effective administration of the intent

 5  of this section.

 6         (11)  No high hazard member shall be permitted to

 7  receive benefits under this section until examined by a duly

 8  qualified physician or surgeon, or board of physicians and

 9  surgeons, to be selected by the Governor for that purpose, and

10  found to be disabled in the degree and in the manner specified

11  in this section.  At such time as the division Department of

12  Management Services directs, any high hazard member receiving

13  disability benefits under this section shall submit to a

14  medical examination to determine if such disability has

15  continued, and the cost of such examination shall be paid from

16  the retirement trust fund herein provided for; and in the

17  event it is declared by said examination that said disability

18  has cleared, such member shall be ordered to return to active

19  duty with the same rank and salary that he or she had at the

20  time of disability.  Any such member who shall fail to return

21  to duty following such order shall forfeit all rights and

22  claims under this law.  Every high hazard member retiring

23  under this provision shall be paid so long as the member's

24  permanent total or partial disability continues, on his or her

25  own requisition.

26         Section 63.  Section 122.351, Florida Statutes, is

27  amended to read:

28         122.351  Funding by local agencies.--Commencing on July

29  1, 1969, all county and local agencies covered under the

30  provisions of s. 122.35 shall accumulate and be responsible

31  for the payment of social security and retirement matching

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 1  costs as required under s. 122.35, from the intangible tax

 2  allocation of that county and any other source available to

 3  the local governmental units, except that all agencies, other

 4  than the school boards, shall be given credit for 50 percent

 5  of their 1967-1969 actual employer matching cost, actual cost

 6  being that cost in cash actually paid by the employer for

 7  matching retirement and social security into the fund by the

 8  agency for said biennium. The above credit of 50 percent shall

 9  be calculated by the division department.

10         Section 64.  Subsection (6) of section 175.032, Florida

11  Statutes, is amended to read:

12         175.032  Definitions.--For any municipality, special

13  fire control district, chapter plan, local law municipality,

14  local law special fire control district, or local law plan

15  under this chapter, the following words and phrases have the

16  following meanings:

17         (6)  "Division" means the Division of Retirement of the

18  State Board of Administration Department of Management

19  Services.

20         Section 65.  Subsection (1) of section 175.121, Florida

21  Statutes, is amended to read:

22         175.121  Department of Revenue and Division of

23  Retirement to keep accounts of deposits; disbursements.--For

24  any municipality or special fire control district having a

25  chapter or local law plan established pursuant to this

26  chapter:

27         (1)  The Department of Revenue shall keep a separate

28  account of all moneys collected for each municipality and each

29  special fire control district under the provisions of this

30  chapter. Seven and three-tenths percent of all moneys so

31  collected shall be transferred to the General Revenue Fund as

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 1  a service charge consistent with s. 215.20. The balance of all

 2  moneys so collected shall must be transferred to the Police

 3  and Firefighters' Premium Tax Trust Fund and shall be

 4  separately accounted for by the division. The moneys budgeted

 5  as necessary to pay the expenses of the division for the daily

 6  oversight and monitoring of the firefighters' pension plans

 7  under this chapter and for the oversight and actuarial reviews

 8  conducted under part VII of chapter 112 are annually

 9  appropriated from the interest and investment income earned on

10  the moneys collected for each municipality or special fire

11  control district and deposited in the Police and Firefighters'

12  Premium Tax Trust Fund. Interest and investment income

13  remaining thereafter in the trust fund which is unexpended and

14  otherwise unallocated by law shall be transferred revert to

15  the General Revenue Fund on June 30 of each year.

16         Section 66.  Section 175.1215, Florida Statutes, is

17  amended to read:

18         175.1215  Police and Firefighters' Premium Tax Trust

19  Fund.--The Police and Firefighters' Premium Tax Trust Fund is

20  created in the State Treasury, to be administered by the

21  Division of Retirement of the Department of Management

22  Services. Funds credited to the trust fund, as provided in

23  chapter 95-250, Laws of Florida, or similar legislation, shall

24  be expended for the purposes set forth in that legislation.

25         Section 67.  Subsection (1) of section 175.341, Florida

26  Statutes, is amended to read:

27         175.341  Duties of Division of Retirement; rulemaking

28  authority; investments by State Board of Administration.--

29         (1)  The division shall be responsible for the daily

30  oversight and monitoring for actuarial soundness of the

31  firefighters' pension plans, whether chapter or local law

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 1  plans, established under this chapter, for receiving and

 2  holding the premium tax moneys collected under this chapter,

 3  and, upon determining compliance with the provisions of this

 4  chapter, for disbursing those moneys to the firefighters'

 5  pension plans. The funds necessary to pay expenses for such

 6  administration are shall be annually appropriated from the

 7  interest and investment income earned on moneys deposited in

 8  the trust fund.

 9         Section 68.  Subsection (7) of section 185.02, Florida

10  Statutes, is amended to read:

11         185.02  Definitions.--For any municipality, chapter

12  plan, local law municipality, or local law plan under this

13  chapter, the following words and phrases as used in this

14  chapter shall have the following meanings, unless a different

15  meaning is plainly required by the context:

16         (7)  "Division" means the Division of Retirement of the

17  State Board of Administration Department of Management

18  Services.

19         Section 69.  Subsection (1) of section 185.10, Florida

20  Statutes, is amended to read:

21         185.10  Department of Revenue and Division of

22  Retirement to keep accounts of deposits; disbursements.--For

23  any municipality having a chapter plan or local law plan under

24  this chapter:

25         (1)  The Department of Revenue shall keep a separate

26  account of all moneys collected for each municipality under

27  the provisions of this chapter. Seven and three-tenths percent

28  of all moneys so collected shall be transferred to the General

29  Revenue Fund as a service charge consistent with s. 215.20.

30  The balance of all moneys so collected shall must be

31  transferred to the Police and Firefighters' Premium Tax Trust

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 1  Fund and shall be separately accounted for by the division.

 2  The moneys budgeted as necessary to pay the expenses of the

 3  division for the daily oversight and monitoring of the police

 4  officers' retirement plans under this chapter and for the

 5  oversight and actuarial reviews conducted under part VII of

 6  chapter 112 are annually appropriated from the interest and

 7  investment income earned on the moneys collected for each

 8  municipality or special fire control district and deposited in

 9  the Police and Firefighters' Premium Tax Trust Fund. Interest

10  and investment income remaining thereafter in the trust fund

11  which is unexpended and otherwise unallocated by law shall be

12  transferred revert to the General Revenue Fund on June 30 of

13  each year.

14         Section 70.  Section 185.105, Florida Statutes, is

15  amended to read:

16         185.105  Police and Firefighters' Premium Tax Trust

17  Fund.--The Police and Firefighters' Premium Tax Trust Fund is

18  created in the State Treasury, to be administered by the

19  Division of Retirement of the Department of Management

20  Services. Funds credited to the trust fund, as provided in

21  chapter 95-250, Laws of Florida, or similar legislation, shall

22  be expended for the purposes set forth in that legislation.

23         Section 71.  Subsection (1) of section 185.23, Florida

24  Statutes, is amended to read:

25         185.23  Duties of Division of Retirement; rulemaking

26  authority; investments by State Board of Administration.--

27         (1)  The division shall be responsible for the daily

28  oversight and monitoring for actuarial soundness of the

29  municipal police officers' retirement plans, whether chapter

30  or local law plans, established under this chapter, for

31  receiving and holding the premium tax moneys collected under

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 1  this chapter, and, upon determining compliance with the

 2  provisions of this chapter, for disbursing those moneys to the

 3  municipal police officers' retirement plans. The funds to pay

 4  the expenses for such administration are shall be annually

 5  appropriated from the interest and investment income earned on

 6  moneys deposited in the trust fund.

 7         Section 72.  Paragraph (o) of subsection (4) of section

 8  215.20, Florida Statutes, is amended to read:

 9         215.20  Certain income and certain trust funds to

10  contribute to the General Revenue Fund.--

11         (4)  The income of a revenue nature deposited in the

12  following described trust funds, by whatever name designated,

13  is that from which the appropriations authorized by subsection

14  (3) shall be made:

15         (o)  Within the Department of Management Services:

16         1.  The Administrative Trust Fund.

17         2.  The Architects Incidental Trust Fund.

18         3.  The Bureau of Aircraft Trust Fund.

19         4.  The Florida Facilities Pool Working Capital Trust

20  Fund.

21         5.  The Grants and Donations Trust Fund.

22         6.  The Motor Vehicle Operating Trust Fund.

23         7.  The Police and Firefighters' Premium Tax Trust

24  Fund.

25         7.8.  The Public Employees Relations Commission Trust

26  Fund.

27         8.9.  The State Personnel System Trust Fund.

28         9.10.  The Supervision Trust Fund.

29         10.11.  The Working Capital Trust Fund.

30  

31  

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 1  The enumeration of the foregoing moneys or trust funds shall

 2  not prohibit the applicability thereto of s. 215.24 should the

 3  Governor determine that for the reasons mentioned in s. 215.24

 4  the money or trust funds should be exempt herefrom, as it is

 5  the purpose of this law to exempt income from its force and

 6  effect when, by the operation of this law, federal matching

 7  funds or contributions or private grants to any trust fund

 8  would be lost to the state.

 9         Section 73.  Subsection (3) of section 215.28, Florida

10  Statutes, is amended to read:

11         215.28  United States securities, purchase by state and

12  county officers and employees; deductions from salary.--

13         (3)  All deductions so made by any such disbursing

14  authority shall be deposited in a trust account separate and

15  apart from the funds of the state, county, or subordinate

16  agency. Such trust account shall be created in the State

17  Treasury and shall be administered by the State Board of

18  Administration. Such account will be subject to withdrawal

19  only for the purchase of United States securities on behalf of

20  officers and employees, or for refunds to such persons in

21  accordance with the provisions of this law. Whenever the sum

22  of $18.75 or the purchase price of the security requested to

23  be purchased is accumulated from deductions so made from the

24  salaries or wages of an officer or employee, such disbursing

25  agent shall arrange the purchase of the bond or security

26  applied for and have it registered in the name or names

27  requested in the deduction authorization. Securities so

28  purchased will be delivered in such manner as may be

29  convenient for the issuing agent and the purchaser. Any

30  interest earned on moneys in such account while awaiting the

31  accumulation of the purchase price of the security shall be

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 1  transferred to the Florida Retirement System Trust Fund as

 2  reimbursement for administrative costs incurred by the

 3  Division of Retirement of the State Board of Administration

 4  Department of Management Services under this section.

 5         Section 74.  Subsection (7) of section 215.44, Florida

 6  Statutes, is amended to read:

 7         215.44  Board of Administration; powers and duties in

 8  relation to investment of trust funds.--

 9         (7)  Investment and debt purchasing procedures and

10  contracts of funds held in trust by the State Board of

11  Administration, whether directly or incidentally related to

12  the investment or debt transactions, and purchases of

13  commodities or services related to the administration of

14  pension benefits are exempt from the provisions of chapter

15  287.

16         Section 75.  Subsection (3) of section 215.50, Florida

17  Statutes, is amended to read:

18         215.50  Custody of securities purchased; income.--

19         (3)  The Chief Financial Officer, as custodian of

20  securities owned by the Florida Retirement System Trust Fund

21  and the Florida Survivor Benefit Trust Fund, shall collect the

22  interest, dividends, prepayments, maturities, proceeds from

23  sales, and other income accruing from such assets.  As such

24  income is collected by the Chief Financial Officer, it shall

25  be deposited directly into a commercial bank to the credit of

26  the State Board of Administration. Such bank accounts as may

27  be required for this purpose shall offer satisfactory

28  collateral security as provided by chapter 280. In the event

29  funds so deposited according to the provisions of this section

30  are required for the purpose of paying benefits or other

31  operational needs, the State Board of Administration shall

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 1  remit to the Florida Retirement System Trust Fund in the State

 2  Treasury such amounts as are required may be requested by the

 3  Department of Management Services.

 4         Section 76.  Section 215.52, Florida Statutes, is

 5  amended to read:

 6         215.52  Rules and regulations.--The board may adopt

 7  shall have the power and authority to make reasonable rules

 8  and regulations necessary to implement general law conferring

 9  powers and duties upon it carry out the provisions of ss.

10  215.44-215.53.

11         Section 77.  Subsections (2), (3), (11), and (13) of

12  section 238.01, Florida Statutes, are amended to read:

13         238.01  Definitions.--The following words and phrases

14  as used in this chapter shall have the following meanings

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

16         (2)  "Division" means the Division of Retirement of the

17  State Board of Administration "Department" means the

18  Department of Management Services.

19         (3)  "Teacher" means any member of the teaching or

20  professional staff and any certificated employee of any public

21  free school, of any district school system and vocational

22  school, any member of the teaching or professional staff of

23  the Florida School for the Deaf and Blind, child training

24  schools of the Department of Juvenile Justice, the Department

25  of Corrections, and any tax-supported institution of higher

26  learning of the state, and any member and any certified

27  employee of the Department of Education, any certified

28  employee of the retirement system, any full-time employee of

29  any nonprofit professional association or corporation of

30  teachers functioning in Florida on a statewide basis, which

31  seeks to protect and improve public school opportunities for

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 1  children and advance the professional and welfare status of

 2  its members, any person now serving as superintendent, or who

 3  was serving as county superintendent of public instruction on

 4  July 1, 1939, and any hereafter duly elected or appointed

 5  superintendent, who holds a valid Florida teachers'

 6  certificate. In all cases of doubt the division Department of

 7  Management Services shall determine whether any person is a

 8  teacher as defined herein.

 9         (11)  "Regular interest" means interest at such rate as

10  may be set from time to time by the division Department of

11  Management Services.

12         (13)  "Earnable compensation" means the full

13  compensation payable to a teacher working the full working

14  time for his or her position. In respect to plans A, B, C, and

15  D only, in cases where compensation includes maintenance, the

16  division Department of Management Services shall fix the value

17  of that part of the compensation not paid in money; provided

18  that all members shall from July 1, 1955, make contributions

19  to the retirement system on the basis of "earnable

20  compensation" as defined herein and all persons who are

21  members on July 1, 1955, may, upon application, have their

22  "earnable compensation" for the time during which they have

23  been members prior to that date determined on the basis of

24  "earnable compensation" as defined in this law, upon paying to

25  the retirement system, on or before the date of retirement, a

26  sum equal to the additional contribution with accumulated

27  regular interest thereon they would have made if "earnable

28  compensation" had been defined, at the time they became

29  members, as it is now defined. However, earnable compensation

30  for all plan years beginning on or after July 1, 1990, shall

31  not include any amounts in excess of the compensation

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 1  limitation (originally $200,000) established by s. 401(a)(17)

 2  of the Internal Revenue Code prior to the Omnibus Budget

 3  Reconciliation Act of 1993, which limitation shall be adjusted

 4  for changes in the cost of living since 1989, in the manner

 5  provided by s. 401(a)(17) of the Internal Revenue Code of

 6  1991.  This limitation, which has been part of the Teachers'

 7  Retirement System since plan years beginning on or after July

 8  1, 1990, shall be adjusted as required by federal law for

 9  qualified government plans.

10         Section 78.  Section 238.02, Florida Statutes, is

11  amended to read:

12         238.02  Name and date of establishment.--A retirement

13  system is established and placed under the management of the

14  division Department of Management Services for the purpose of

15  providing retirement allowances and other benefits for

16  teachers of the state.  The retirement system shall begin

17  operations on July 1, 1939.  It has such powers and privileges

18  of a corporation as may be necessary to carry out effectively

19  the provisions of this chapter and shall be known as the

20  "Teachers' Retirement System of the State," and by such name

21  all of its business shall be transacted, all of its funds

22  invested, and all of its cash and securities and other

23  property held in trust for the purpose for which received.

24         Section 79.  Section 238.03, Florida Statutes, is

25  amended to read:

26         238.03  Administration.--

27         (1)  The general administration and the responsibility

28  for the proper operation of the retirement system and for

29  making effective the provisions of this chapter are vested in

30  the division Department of Management Services.  Subject to

31  the limitation of this chapter, the division department shall,

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 1  from time to time, establish rules and regulations for the

 2  administration and transaction of the business of the

 3  retirement system and shall perform such other functions as

 4  are required for the execution of this chapter.

 5         (2)  The division department shall keep in convenient

 6  form such data as shall be necessary for actuarial valuation

 7  of the various funds created by this chapter and for checking

 8  the experience of the retirement system.

 9         (3)  The Department of Legal Affairs, at the option of

10  the State Board of Administration, shall be the legal adviser

11  of the division department.

12         (4)  The division department shall employ such agents,

13  servants and employees as in its judgment may be necessary to

14  carry out the terms and provisions of this chapter and shall

15  provide for their compensation.  Among the employees of the

16  division department shall be an actuary who shall be the

17  technical adviser of the division department on matters

18  regarding the operation of the funds created by the provisions

19  of this chapter and who shall perform such other duties as are

20  required in connection therewith.

21         (5)  In the year 1943 and at least once in each 5-year

22  period thereafter, the actuary shall make an actuarial

23  investigation of the mortality, service and salary experience

24  of the members and beneficiaries as defined in this chapter,

25  and shall make a valuation of the various funds created by the

26  chapter, and having regard to such investigation and

27  valuation, the division department shall adopt such mortality

28  and service tables as shall be deemed necessary, and shall

29  certify the rates of contribution payable under the provisions

30  of this chapter.

31  

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 1         (6)  The actuary shall make an annual valuation of the

 2  assets and liabilities of the funds of the retirement system

 3  on the basis of the tables adopted by the division department

 4  in accordance with the requirements of this section, and shall

 5  prepare an annual statement of the amounts to be contributed

 6  by the state in accordance with s. 238.09.

 7         (7)  The division department shall publish annually the

 8  valuation, as certified by the actuary, of the assets and

 9  liabilities of the various funds created by this chapter, a

10  statement as to the receipts and disbursements of the funds,

11  and a statement as to the accumulated cash and securities of

12  the funds.

13         (8)  The division department shall keep a record of all

14  of its proceedings and such record shall be open to inspection

15  by the public.

16         (9)  The division department is authorized to

17  photograph and reduce to microfilm as a permanent record, its

18  ledger sheets showing the salary and contributions of members

19  of the retirement system, also the records of deceased members

20  of the system and thereupon to destroy the documents from

21  which such films are photographed.

22         Section 80.  Paragraph (b) of subsection (1),

23  paragraphs (a) and (b) of subsection (3), and subsection (4)

24  of section 238.05, Florida Statutes, are amended to read:

25         238.05  Membership.--

26         (1)  The membership of the retirement system shall

27  consist of the following:

28         (b)  All persons who became or who become teachers on

29  or after July 1, 1939, except as provided in paragraph (a) and

30  subsection (5) hereof, shall become members of the retirement

31  system by virtue of their appointment as teachers.  However,

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 1  employees who are not members of the teaching or professional

 2  staff shall only become members of the retirement system by

 3  filing a notice with the division department of their election

 4  to become members.

 5         (3)  Except as otherwise provided in s. 238.07(9),

 6  membership of any person in the retirement system will cease

 7  if he or she is continuously unemployed as a teacher for a

 8  period of more than 5 consecutive years, or upon the

 9  withdrawal by the member of his or her accumulated

10  contributions as provided in s. 238.07(13), or upon

11  retirement, or upon death; provided that the adjustments

12  prescribed below are to be made for persons who enter the

13  Armed Forces of the United States during a period of war or

14  national emergency and for persons who are granted leaves of

15  absence.  Any member of the retirement system who within 1

16  year before the time of entering the Armed Forces of the

17  United States was a teacher, as defined in s. 238.01, or was

18  engaged in other public educational work within the state, and

19  member of the Teachers' Retirement System at the time of

20  induction, or who has been or is granted leave of absence,

21  shall be permitted to elect to continue his or her membership

22  in the Teachers' Retirement System; and membership service

23  shall be allowed for the period covered by service in the

24  Armed Forces of the United States or by leave of absence under

25  the following conditions:

26         (a)  A person who has been granted leave of absence

27  shall file with the division department before his or her next

28  contribution is due an application to continue his or her

29  membership during the period covered by the person's leave of

30  absence and, if such application is filed, shall make his or

31  her contribution to the retirement system on the basis of his

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 1  or her last previous annual salary as a teacher, and shall,

 2  prior to retirement, pay in full to the system such

 3  contributions with accumulated regular interest.  Such

 4  contributions with interest may be paid at one time or in

 5  monthly, quarterly, semiannual, or annual payments in the

 6  person's discretion.

 7         (b)  A person who enters or who has entered the Armed

 8  Forces of the United States may either continue his or her

 9  membership according to the plan outlined under paragraph (a)

10  or, in lieu thereof, may file with the division departmentat

11  any time following the close of his or her military service an

12  application that his or her membership be continued and that

13  membership service be allowed for not more than 5 years of his

14  or her period of service in the Armed Forces of the United

15  States during any period of war or national emergency;

16  provided that any such person shall, prior to retirement, pay

17  in full his or her contributions with accumulated regular

18  interest to the retirement system for the period for which he

19  or she is entitled to membership service on the basis of his

20  or her last previous annual salary as a teacher.  Such

21  contributions with interest may be paid to the division

22  department at one time or in monthly, quarterly, semiannual,

23  or annual payments in the person's discretion.

24         (4)  The division department may in its discretion deny

25  the right to become members to any class of teachers who are

26  serving on a temporary or any other than a per annum basis,

27  and it may also in its discretion make optional with members

28  in any such class their individual entrance into membership.

29         Section 81.  Subsections (3), (10), (12), (13), (15A),

30  and (16) of section 238.07, Florida Statutes, are amended to

31  read:

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 1         238.07  Regular benefits; survivor benefits.--

 2         (3)  Any member who, prior to July 1, 1955, elected to

 3  retire under one of plans A, B, C, or D may elect, prior to

 4  retirement, to retire under plan E in accordance with the

 5  terms hereof.  Any person who became a member on or after July

 6  1, 1955, shall retire under plan E, except as provided for

 7  under s. 238.31. With respect to plans A, B, C, or D, any

 8  member shall have the right at any time to change to a plan of

 9  retirement requiring a lower rate of contribution.  The

10  division Department of Management Services shall also notify

11  the member of the rate of contribution such member must make

12  from and after selecting such plan of retirement.  Any member

13  in service may retire upon reaching the age of retirement

14  formerly selected by him or her, upon the member's written

15  application to the division department setting forth at which

16  time, not more than 90 days subsequent to the execution and

17  filing of such application, it is his or her desire to retire

18  notwithstanding that during such period of notification he or

19  she may have separated from service.  Upon receipt of such

20  application for retirement, the division department shall

21  retire such member not more than 90 days thereafter.  Before

22  such member may retire he or she must file with the division

23  department his or her written selection of one of the optional

24  benefits provided in s. 238.08.

25         (10)  Any member in service, who has 10 or more years

26  of creditable service, may upon the application of his or her

27  employer or upon his or her own application, be retired by the

28  division department not less than 30 nor more than 90 days

29  next following the date of filing such application, on a

30  disability retirement allowance; provided that a physician

31  licensed by this state examines and certifies that such member

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 1  is mentally or physically incapacitated for the further

 2  performance of duty, that such incapacity is likely to be

 3  permanent, and that such member should be retired, and the

 4  division department concurs.  In making the determination, the

 5  division department may require other evidence of disability

 6  as deemed appropriate.

 7         (12)(a)  Once each year during the first 5 years

 8  following the retirement of a member on a disability

 9  retirement allowance, and once in every 3-year period

10  thereafter, the division department may require any disability

11  beneficiary who has not yet attained his or her minimum

12  service retirement age to undergo a medical examination by a

13  physician licensed by this state and to submit any other

14  evidence of disability as required by the division department.

15  Should a disability beneficiary who has not yet attained his

16  or her minimum service retirement age refuse to submit to any

17  such medical examination, his or her retirement allowance

18  shall be discontinued until his or her withdrawal of such

19  refusal, and should such refusal continue for 1 year, all of

20  the disability beneficiary's rights in and to his or her

21  pension shall be forfeited.

22         (b)  If the division department finds that a disability

23  beneficiary is engaged in or is able to engage in a gainful

24  occupation paying more than the difference between his or her

25  disability retirement allowance and his or her average final

26  compensation, the amount of the beneficiary's pension shall be

27  reduced to an amount which, together with his or her annuity

28  and the amount earnable by him or her, shall equal the amount

29  of his or her average final compensation. Should the

30  beneficiary's earning capacity later be changed, the amount of

31  his or her pension may be further modified; provided that the

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 1  pension so modified shall not exceed the amount of the pension

 2  allowable under subsection (11), at the time of retirement,

 3  nor an amount which, when added to the amount earnable by the

 4  beneficiary, together with his or her annuity, equals the

 5  amount of his or her average final compensation.  A

 6  beneficiary restored to active service at a salary less than

 7  the average final compensation upon the basis of which he or

 8  she was retired shall not become a member of the retirement

 9  system at that time.

10         (c)  Should a disability beneficiary under his or her

11  minimum service retirement age be at any time in service at a

12  salary equal to or greater than his or her average final

13  compensation upon the basis of which he or she was retired,

14  the beneficiary's disability retirement allowance shall cease

15  and he or she shall again become a member of the retirement

16  system and shall contribute thereafter at the same rate at

17  which he or she paid prior to disability.  Any prior service

18  certificate, on the basis of which his or her allowance was

19  computed at the time of his or her disability retirement,

20  shall be restored to full force and effect; and, in addition,

21  upon his or her subsequent retirement he or she shall be

22  credited with all his or her membership service on the basis

23  of which his or her allowance was computed at the time of his

24  or her disability retirement.

25         (13)  Should a member cease to be a teacher except by

26  death or by retirement under the provisions of this chapter,

27  the member shall be paid the amount of his or her accumulated

28  contributions.  Should a member die before retirement, the

29  amount of his or her accumulated contributions shall be paid

30  to such person, if any, as he or she shall have nominated by

31  written designation duly executed and filed with the division

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 1  department; otherwise, to his or her executors or

 2  administrators.

 3         (15A)(a)  Any member of the Teachers' Retirement System

 4  who has heretofore, or who hereafter, retires with no less

 5  than 10 years of creditable service and who has passed his or

 6  her 65th birthday, may, upon application to the division

 7  department, have his or her retirement allowance redetermined

 8  and thereupon shall be entitled to a monthly service

 9  retirement allowance which shall be equal to $4 multiplied by

10  the number of years of the member's creditable service which

11  shall be payable monthly during his or her retirement;

12  provided, that the amount of retirement allowance as

13  determined hereunder, shall be reduced by an amount equal to:

14         1.  Any social security benefits received by the

15  member, and

16         2.  Any social security benefits that the member is

17  eligible to receive by reason of his or her own right or

18  through his or her spouse.

19         (b)  No payment shall be made to a member of the

20  Teachers' Retirement System under this act, until the division

21  department has determined the social security status of such

22  member.

23         (c)  Eligibility of a member of the Teachers'

24  Retirement System shall be determined under the social

25  security laws and regulations; provided, however, that a

26  member shall be considered eligible if the member or the

27  member's spouse has reached 65 years of age and would draw

28  social security if the member or the member's spouse were not

29  engaged in activity that results in the member or the member's

30  spouse receiving income that would make him or her ineligible

31  to receive social security benefits.  A member of the

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 1  Teachers' Retirement System shall be deemed to be eligible for

 2  social security benefits if the member has this eligibility in

 3  his or her own right or through his or her spouse.

 4         (d)  The division department shall review, at least

 5  annually, the social security status of all members of the

 6  Teachers' Retirement System receiving payment under this act

 7  and shall increase or decrease payments to such members as

 8  shall be necessary to carry out the intent of this act.

 9         (e)  No member of the Teachers' Retirement System shall

10  have his or her retirement allowance reduced or any of his or

11  her rights impaired by reason of this act.

12         (f)  This subsection shall take effect on January 1,

13  1962.

14         (16)(a)  Definitions under survivor benefits are:

15         1.  A dependent is a child, widow, widower, or parent

16  of the deceased member who was receiving not less than

17  one-half of his or her support from the deceased member at the

18  time of the death of such member.

19         2.  A child is a natural or legally adopted child of a

20  member, who:

21         a.  Is under 18 years of age, or

22         b.  Is over 18 years of age but not over 22 years of

23  age and is enrolled as a student in an accredited educational

24  institution, or

25         c.  Is 18 years of age or older and is physically or

26  mentally incapable of self-support, when such mental and

27  physical incapacity occurred prior to such child obtaining the

28  age of 18 years.  Such person shall cease to be regarded as a

29  child upon the termination of such physical or mental

30  disability.  The determination as to such physical or mental

31  incapability shall be vested in the division department.

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 1  

 2  No person shall be considered a child who has married or,

 3  except as provided in sub-subparagraph 2.b. or as to a child

 4  who is physically or mentally incapable of self-support as

 5  hereinbefore set forth, has become 18 years of age.

 6         3.  A parent is a natural parent of a member and

 7  includes a lawful spouse of a natural parent.

 8         4.  A beneficiary is a person who is entitled to

 9  benefits under this subsection by reason of his or her

10  relation to a deceased member during the lifetime of such

11  member.

12         (b)  In addition to all other benefits to which a

13  member shall, subject to the conditions set out below, be

14  entitled, the beneficiary of such member shall, upon the death

15  of such member, receive the following benefits:

16  

17  Minimum period of     Beneficiaries of    Benefits

18  paid service of       deceased member

19  member in Florida as

20  regular full-time

21  teacher

22  

23  1.  One calendar day  Widow or widower    $190 per month for

24                        who has care of     one child. $250 per

25                        dependent child or  month if more than

26                        children of         one child, maximum

27                        deceased member.    benefits $250 per

28                                            month.

29  

30  

31  

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 1  2.  One calendar day  One or more         $190 per month per

 2                        dependent children  child; maximum

 3                        if there is no      benefits $250 per

 4                        surviving widow or  month if more than

 5                        widower.            one child.

 6  

 7  3.  One calendar day  Dependent parents   For each parent,

 8                        65 years or older.  $100 per month for

 9                                            life.

10  

11  4.  One calendar day  Designated          $500 lump-sum death

12                        beneficiary and,    benefits payable

13                        if no designated    only once.

14                        beneficiary, then

15                        the executor or

16                        administrator of

17                        deceased member.

18  

19  5.  One calendar day  Dependent widow or  $150 per month for

20                        widower 50 years    life.

21                        of age and less

22                        than 65 years of

23                        age.

24  

25  6.  Ten years         Widow or widower    $175 per month for

26                        65 years of age or  life.

27                        older.

28  

29  

30  

31  

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 1  7.  Retired member    Designated          $500 lump-sum death

 2                        beneficiary and if  benefits payable

 3                        no designated       only once.

 4                        beneficiary, then

 5                        the executor or

 6                        administrator of

 7                        deceased retired

 8                        member.

 9  

10  Beginning on July 1, 1971, the lump-sum death benefit,

11  provided in item 7 above for the retired teacher, shall apply

12  to all present and future retirees of the systems.

13         (c)  The payment of survivor benefits shall begin as of

14  the month immediately following the death of the member except

15  where the beneficiary has not reached the age required to

16  receive benefits under paragraph (b), in which event the

17  payment of survivor benefits shall begin as of the month

18  immediately following the month in which the beneficiary

19  reaches the required age. Provided that if death occurs during

20  the first 3 years of employment, the payment of survivor

21  benefits shall be reduced by the amount of monthly benefits

22  the member's survivors are entitled to receive under federal

23  social security as either a survivor of the member or as a

24  covered worker under federal social security.

25         (d)  Limitations on rights of beneficiary are:

26         1.  The person named as beneficiary in paragraph (b)

27  shall, in no event, be entitled to receive the benefits set

28  out in such paragraph unless the death of the member under

29  whom such beneficiary claims occurs within the period of time

30  after the member has served in Florida as follows:

31  

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 1  Minimum number of years                Period after serving in

 2         of service in Florida                  Florida in which

 3                                                 death of member

 4                                                          occurs

 5  

 6         3 to 5........................................2 years  

 7         6 to 9........................................5 years  

 8         10 or more...................................10 years  

 9  

10         2.  Upon the death of a member, the division department

11  shall make a determination of the beneficiary or beneficiaries

12  of the deceased member and shall pay survivor benefits to such

13  beneficiary or beneficiaries beginning 1 month immediately

14  following the death of the member except where the beneficiary

15  has not reached the age required to receive benefits under

16  paragraph (b), in which event the payment of survivor benefits

17  shall begin as of the month immediately following the month in

18  which the beneficiary reaches the required age.  When required

19  by the division department, the beneficiary or beneficiaries

20  shall file an application for survivor benefits upon forms

21  prescribed by the division department.

22         3.  The beneficiaries of a member to receive survivor

23  benefits are fixed by this subsection, and a member may not

24  buy or otherwise change such benefits.  He or she may,

25  however, designate the beneficiary to receive the $500 death

26  benefits.  If a member fails to make this designation, the

27  $500 death benefits shall be paid to his or her executor or

28  administrator.

29         4.  The beneficiary or beneficiaries of a member whose

30  death occurs while he or she is in service or while he or she

31  is receiving a disability allowance under subsection (11),

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 1  shall receive survivor benefits under this subsection

 2  determined by the years of service in Florida of the deceased

 3  member as set out in paragraph (b).  The requirement that the

 4  death of a member must occur within a certain period of time

 5  after service in Florida as set out in subparagraph (d)1.

 6  shall not apply to a member receiving a disability benefit at

 7  the time of his or her death.

 8         Section 82.  Subsection (2), paragraph (b) of

 9  subsection (5), and subsections (6) and (7) of section 238.08,

10  Florida Statutes, are amended to read:

11         238.08  Optional benefits.--A member may elect to

12  receive his or her benefits under the terms of this chapter

13  according to the provisions of any one of the following

14  options:

15         (2)  Option two. A member may elect to receive on

16  retirement the actuarial equivalent (at that time) of his or

17  her retirement allowance in a reduced retirement allowance

18  payable throughout life, with the provisions that if the

19  member dies before he or she has received in payment of his or

20  her annuity the amount of his or her accumulated

21  contributions, as they were at the time of his or her

22  retirement, the balance shall be paid to such person, if any,

23  as he or she shall nominate by written designation duly

24  acknowledged and filed with the division department;

25  otherwise, to his or her executors or administrators.

26         (5)

27         (b)  A member who elects Option three or Option four

28  shall, on a form provided for that purpose, designate his or

29  her spouse as beneficiary to receive the benefits which

30  continue to be payable upon the death of the member.  After

31  such benefits have commenced under Option three or Option

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 1  four, the retired member may change the designation of his or

 2  her spouse as beneficiary only twice.  If such a retired

 3  member remarries and wishes to make such a change, he or she

 4  may do so by filing with the division department a notarized

 5  change of spouse designation form and shall notify the former

 6  spouse in writing of such change.  Upon receipt of a completed

 7  change of spouse designation form, the division department

 8  shall adjust the member's monthly benefit by the application

 9  of actuarial tables and calculations developed to ensure that

10  the benefit paid is the actuarial equivalent of the present

11  value of the member's current benefit. The consent of a

12  retired member's formerly designated spouse as beneficiary to

13  any such change shall not be required.

14         (6)  Notwithstanding any provision in this chapter to

15  the contrary, the following provisions shall apply to any

16  member of the retirement system who has accumulated at least

17  10 years of service and dies prior to retirement:

18         (a)  If the deceased member's surviving spouse has

19  previously received a refund of the member's accumulated

20  contributions made to the retirement system, such spouse may

21  pay to the division department an amount equal to the sum of

22  the amount of the deceased member's contributions previously

23  refunded and regular interest compounded annually on the

24  amount of such refunded contributions from the date of refund

25  to the date of payment to the division department, and by so

26  doing be entitled to receive the monthly retirement benefit

27  provided in paragraph (c).

28         (b)  If the deceased member's surviving spouse has not

29  received a refund of the deceased member's accumulated

30  contributions, such spouse shall, upon application to the

31  division department within 30 days of the death of the member,

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 1  receive the monthly retirement benefit provided in paragraph

 2  (c).

 3         (c)  The monthly benefit payable to the spouse

 4  described in paragraph (a) or paragraph (b) shall be the

 5  amount which would have been payable to the deceased member's

 6  spouse, assuming that the member retired on the date of his or

 7  her death and had selected the option in subsection (3), such

 8  benefit to be based on the ages of the spouse and member as of

 9  the date of death of the member. The benefit shall commence on

10  the first day of the month following the payment of the

11  aforesaid amount to the division department, if paragraph (a)

12  is applicable, or on the first day of the month following the

13  receipt of the spouse's application by the division

14  department, if paragraph (b) is applicable.

15         (7)  The surviving spouse or other dependent of any

16  member whose employment is terminated by death shall, upon

17  application to the division department, be permitted to pay

18  the required contributions for any service performed by the

19  member which could have been claimed by the member at the time

20  of his or her death.  Such service shall be added to the

21  creditable service of the member and shall be used in the

22  calculation of any benefits which may be payable to the

23  surviving spouse or other surviving dependent.

24         Section 83.  Paragraphs (a), (c), and (d) of subsection

25  (1), paragraphs (b) and (c) of subsection (3), subsection (4),

26  and paragraph (b) of subsection (5) of section 238.09, Florida

27  Statutes, are amended to read:

28         238.09  Method of financing.--All of the assets of the

29  retirement system shall be credited, according to the purposes

30  for which they are held, to one of four funds; namely, the

31  Annuity Savings Trust Fund, the Pension Accumulation Trust

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 1  Fund, the Expense Trust Fund, and the Survivors' Benefit Trust

 2  Fund.

 3         (1)  The Annuity Savings Trust Fund shall be a fund in

 4  which shall be accumulated contributions made from the

 5  salaries of members under the provisions of paragraph (c) or

 6  paragraph (f). Contribution to, payments from, the Annuity

 7  Savings Trust Fund shall be made as follows:

 8         (a)  With respect to plan A, B, C, or D, upon the basis

 9  of such tables as the division Department of Management

10  Services shall adopt, and regular interest, the actuary of the

11  retirement system shall determine for each member the

12  proportion of earnable compensation which, when deducted from

13  each payment of his or her prospective earnable annual

14  compensation prior to his or her minimum service retirement

15  age, and accumulated at regular interest until such age, shall

16  be computed to provide at such age:

17         1.  An annuity equal to one one-hundred-fortieth of his

18  or her average final compensation multiplied by the number of

19  his or her years of membership in the case of each member

20  electing to retire under the provisions of plan A or B.

21         2.  An annuity equal to one one-hundred-twentieth of

22  his or her average final compensation multiplied by the number

23  of his or her years of membership service in the case of each

24  member electing to retire under the provisions of plan C.

25         3.  An annuity equal to one one-hundredth of his or her

26  average final compensation multiplied by the number of his or

27  her years of membership service in the case of each member

28  electing to retire under the provisions of plan D.

29  

30  In the case of any member who has attained his or her minimum

31  service retirement age prior to becoming a member, the

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 1  proportion of salary applicable to such member, with respect

 2  to plan A, B, C, or D, shall be the proportion computed for

 3  the age 1 year younger than his or her minimum service

 4  retirement age.

 5         (c)  The division department shall certify to each

 6  employer the proportion of the earnable compensation of each

 7  member who is compensated by the employer, and the employer

 8  shall cause to be deducted from the salary of each member on

 9  each and every payroll for each and every payroll period an

10  amount equal to the proportion of the member's earnable

11  compensation so computed.  With respect to plan A, B, C, or D,

12  the employer shall not make any deduction for annuity purposes

13  from the compensation of a member who has attained the age of

14  60 years, if such member elects not to contribute.

15         (d)  In determining the amount earnable by a member in

16  a payroll period, the division department may consider the

17  rate of compensation payable to such member on the first day

18  of the payroll period as continuing throughout such payroll

19  period, and it may omit deductions from compensation for any

20  period less than a full payroll period if a teacher was not a

21  member on the first day of the payroll period, and to

22  facilitate the making of deductions, it may modify any

23  deduction required of any member by such an amount as shall

24  not exceed one-tenth of 1 percent of the annual salary from

25  which said deduction is to be made.

26         (3)  The Pension Accumulation Trust Fund shall be the

27  fund in which shall be accumulated all reserves for the

28  payment of all annuities or benefits in lieu of annuities on

29  retired members and all pensions and other benefits payable

30  from contributions made by the members and by the employers,

31  from which annuities, pensions and benefits in lieu thereof

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 1  shall be paid. Contributions to, and payments from, the

 2  Pension Accumulation Trust Fund, other than as set forth in

 3  subsections (2) and (3) herein, shall be made as follows:

 4         (b)  On the basis of regular interest and of such

 5  mortality and other tables as shall be adopted by the division

 6  department, the actuary engaged by the division department to

 7  make each valuation required by this chapter shall, during the

 8  period over which the accrued liability contribution is

 9  payable, determine, immediately after making such valuation,

10  the uniform and constant percentage of the earnable

11  compensation of the average new entrant, which, if contributed

12  on the basis of his or her compensation throughout his or her

13  entire period of service, would be sufficient to provide for

14  the payment of any pension payable by the state on his or her

15  account.  The rate percent so determined shall be known as the

16  normal contribution rate.  After the accrued liability

17  contribution has ceased to be payable, the normal contribution

18  rate shall be the rate percent of the earnable compensation of

19  all members, obtained by deducting from the total liabilities

20  of the Pension Accumulation Trust Fund the amount of the funds

21  in hand to the credit of that fund and dividing the remainder

22  by 1 percent of the present value of the prospective future

23  salaries of all members as computed on the basis of the

24  mortality and service tables adopted by the division

25  department and on the basis of regular interest.  The normal

26  rate of contribution shall be determined and certified to the

27  division department by the actuary after each valuation and

28  shall continue in force until a new valuation and

29  certification are made.

30         (c)  Immediately succeeding the first valuation, the

31  actuary engaged by the division department shall compute the

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 1  rate percent of the total earnable compensation of all members

 2  which is equivalent to 4 percent of the amount of the total

 3  liability for pensions on account of all members and

 4  beneficiaries and not dischargeable by the present assets of

 5  the Pension Accumulation Trust Fund and by the aforesaid

 6  normal contribution if made on account of such members during

 7  the remainder of their active service.  The rate percent,

 8  originally so determined, shall be known as the accrued

 9  liability contribution rate.

10         (4)  The Expense Trust Fund shall be the fund to which

11  shall be credited all moneys contributed for the

12  administrative expenses of the retirement system and from

13  which shall be paid all expenses incurred in connection with

14  the administration and operation of the retirement system.

15  Contribution to the Expense Trust Fund shall be made by

16  transfer from interest earnings on investments in the Annuity

17  Savings Trust Fund.  Such transfers shall be approved by the

18  State Board of Administration in accordance with s. 215.44(4)

19  regulated by the Legislature pursuant to budgets filed in

20  accordance with the provisions of chapter 216.

21         (5)

22         (b)  The division department shall annually certify to

23  each employer, at the time it makes the certification to the

24  employer under paragraph (1)(c), the rate of

25  twenty-five-hundredths percent to be applied by the employer

26  to the salary of each member who is compensated by the

27  employer, and the employer shall cause to be deducted from the

28  salary of each member on each and every payroll for each and

29  every payroll period an amount equal to twenty-five-hundredths

30  percent of the member's salary paid by the employer and the

31  employer shall remit monthly such deducted amounts to the

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 1  division department which shall place the same in the

 2  Survivors' Benefit Trust Fund of the Teachers' Retirement

 3  System of the state. The amount of contributions by a member

 4  to the Survivors' Benefit Trust Fund shall, in no event, be

 5  refundable to the member or his or her beneficiaries.

 6         Section 84.  Section 238.10, Florida Statutes, is

 7  amended to read:

 8         238.10  Management of funds.--The division Department

 9  of Management Services, annually, shall allow regular interest

10  on the amount for the preceding year to the credit of each of

11  the funds of the retirement system, and to the credit of the

12  individual account therein, if any, with the exception of the

13  expense fund, from the interest and dividends earned from

14  investments.

15         Section 85.  Paragraph (b) of subsection (1) and

16  subsections (2) and (3) of section 238.11, Florida Statutes,

17  are amended to read:

18         238.11  Collection of contributions.--

19         (1)  The collection of contributions shall be as

20  follows:

21         (b)  Each employer shall transmit monthly to the

22  division Department of Management Services a warrant for the

23  total amount of such deductions. Each employer shall also

24  transmit monthly to the division department a warrant for such

25  employer contribution set aside as provided for in paragraph

26  (a) of this subsection. The division department, after making

27  records of all such warrants, shall transmit them to the

28  Department of Financial Services for delivery to the Chief

29  Financial Officer, who shall collect them.

30         (2)  The collection of the state contribution shall be

31  made as follows:

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 1         (a)  The amounts required to be paid by the state into

 2  the Teachers' Retirement System in this chapter shall be

 3  provided therefor in the General Appropriations Act. However,

 4  in the event a sufficient amount is not included in the

 5  General Appropriations Act to meet the full amount needed to

 6  pay the retirement compensation provided for in this chapter,

 7  the additional amount needed for such retirement compensation

 8  is hereby appropriated from the General Revenue Fund as

 9  approved by the division Department of Management Services.

10         (b)  The division Department of Management Services

11  shall certify one-fourth of the amount so ascertained for each

12  year to the Chief Financial Officer on or before the last day

13  of July, October, January, and April of each year. The Chief

14  Financial Officer shall, on or before the first day of August,

15  November, February, and May of each year, immediately transfer

16  to the several funds of the retirement system the amounts due.

17         (3)  All collection of contributions of a nonprofit

18  professional association or corporation of teachers as

19  referred to in s. 238.01(3) and (5) shall be made by such

20  association or corporation in the following manner:

21         (a)  On April 1 of each year, the division Department

22  of Management Services shall certify to any such nonprofit

23  professional association or corporation of teachers the

24  amounts which will become due and payable during the ensuing

25  fiscal year to each of the funds of the retirement system to

26  which such contributions are payable as set forth in this law.

27         (b)  The division Department of Management Services

28  shall certify one-fourth of the amount so ascertained for each

29  year to the nonprofit professional association or corporation

30  of teachers on or before the last day of July, October,

31  January, and April of each year. The nonprofit professional

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 1  association or corporation of teachers shall, on or before the

 2  first day of August, November, February, and May of each year,

 3  draw its check payable to the division department for the

 4  respective amounts due the several funds of the retirement

 5  system. Upon receipt of the check, the division department

 6  shall immediately transfer to the several funds of the

 7  retirement system the amounts due, provided, however, that the

 8  amounts due the several funds of the retirement system from

 9  any such association or corporation for creditable service

10  accruing to any such member before July 1, 1947, shall be paid

11  prior to the retirement of any such member.

12         Section 86.  Section 238.12, Florida Statutes, is

13  amended to read:

14         238.12  Duties of employers.--

15         (1)  Each employer shall keep such records and, from

16  time to time, shall furnish such information as the division

17  Department of Management Services may require in the discharge

18  of its duties.  Upon the employment of any teacher to whom

19  this chapter may apply, the teacher shall be informed by his

20  or her employer of his or her duties and obligations in

21  connection with the retirement system as a condition of his or

22  her employment.  Every teacher accepting employment shall be

23  deemed to consent and agree to any deductions from his or her

24  compensation required in this chapter and to all other

25  provisions of this chapter.

26         (2)  During September of each year, or at such other

27  time as the division department shall approve, each employer

28  shall certify to the division department the names of all

29  teachers to whom this chapter applies.

30         (3)  Each employer shall, on the first day of each

31  calendar month, or at such less frequent intervals as the

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 1  division department may approve, notify the division

 2  department of the employment of new teachers, removals,

 3  withdrawals and changes in salary of members that have

 4  occurred during the preceding month, or the period covered

 5  since the last notification.

 6         Section 87.  Section 238.14, Florida Statutes, is

 7  amended to read:

 8         238.14  Protection against fraud.--Any person who shall

 9  knowingly make any false statement, or shall falsify or permit

10  to be falsified any record or records of this retirement

11  system in any attempt to defraud such system as a result of

12  such act, shall be guilty of a misdemeanor of the second

13  degree, punishable as provided in s. 775.082 or s. 775.083.

14  Should any change or error in records result in any member or

15  beneficiary receiving from the retirement system more or less

16  than he or she would have been entitled to receive had the

17  records been correct, then on discovery of any such error the

18  division department shall correct such error, and, as far as

19  practicable, shall adjust the payments in such a manner that

20  the actuarial equivalent of the benefit, to which such member

21  or beneficiary was correctly entitled, shall be paid.

22         Section 88.  Section 238.15, Florida Statutes, is

23  amended to read:

24         238.15  Exemption of funds from taxation, execution,

25  and assignment.--The pensions, annuities or any other benefits

26  accrued or accruing to any person under the provisions of this

27  chapter and the accumulated contributions and cash securities

28  in the funds created under this chapter are exempted from any

29  state, county or municipal tax of the state, and shall not be

30  subject to execution or attachment or to any legal process

31  whatsoever, and shall be unassignable, except:

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 1         (1)  That any teacher who has retired shall have the

 2  right and power to authorize in writing the division

 3  Department of Management Services to deduct from his or her

 4  monthly retirement allowance money for the payment of the

 5  premiums on group insurance for hospital, medical and surgical

 6  benefits, under a plan or plans for such benefits approved in

 7  writing by the Chief Financial Officer, and upon receipt of

 8  such request the division department shall make the monthly

 9  payments as directed; and

10         (2)  As may be otherwise specifically provided for in

11  this chapter.

12         Section 89.  Paragraph (a) of subsection (3) of section

13  238.171, Florida Statutes, is amended to read:

14         238.171  Monthly allowance; when made.--

15         (3)(a)  On July 1, 1974, the Department of Management

16  Services director of the Division of Retirement shall adjust

17  the monthly allowance provided for incapacitated teachers

18  under this section by increasing said allowance by a

19  percentage which shall be equal to the percentage change in

20  the average cost-of-living index, as defined in chapter 121,

21  over the period between April 1, 1967, and March 31, 1973. The

22  percent of increase, as of July 1, 1974, shall be 25.4

23  percent, which is the average cost-of-living increase

24  percentage from April 1, 1967, through March 31, 1973.

25         Section 90.  Subsection (2) of section 238.181, Florida

26  Statutes, is amended to read:

27         238.181  Reemployment after retirement; conditions and

28  limitations.--

29         (2)(a)  Any person retired under this chapter, except

30  under the disability retirement provisions of s. 238.07, may

31  be reemployed by any private or public employer after

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 1  retirement and receive retirement benefits and compensation

 2  from his or her employer without limitation, except that no

 3  person may receive both a salary from reemployment with any

 4  agency participating in the Florida Retirement System and

 5  retirement benefits under this chapter for a period of 12

 6  months immediately subsequent to the date of retirement.

 7         (b)  Any person to whom the limitation in paragraph (a)

 8  applies who violates such reemployment limitation and who is

 9  reemployed with any agency participating in the Florida

10  Retirement System before completion of the 12-month limitation

11  period shall give timely notice of this fact in writing to his

12  or her employer and to the division Department of Management

13  Services and shall have his or her retirement benefits

14  suspended for the balance of the 12-month limitation period.

15  Any person employed in violation of this paragraph and any

16  employing agency which knowingly employs or appoints such

17  person without notifying the division department to suspend

18  retirement benefits shall be jointly and severally liable for

19  reimbursement to the retirement trust fund of any benefits

20  paid during the reemployment limitation period.  To avoid

21  liability, such employing agency shall have a written

22  statement from the retiree that he or she is not retired from

23  a state-administered retirement system.  Any retirement

24  benefits received while reemployed during this reemployment

25  limitation period shall be repaid to the retirement trust

26  fund, and retirement benefits shall remain suspended until

27  such repayment has been made.  Benefits suspended beyond the

28  reemployment limitation shall apply toward repayment of

29  benefits received in violation of the reemployment limitation.

30         (c)  A district school board may reemploy a retired

31  member as a substitute or hourly teacher on a noncontractual

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 1  basis after he or she has been retired for 1 calendar month,

 2  in accordance with s. 121.021(39).  Any retired member who is

 3  reemployed within 1 calendar month after retirement shall void

 4  his or her application for retirement benefits.  District

 5  school boards reemploying such teachers are subject to the

 6  retirement contribution required by paragraph (g).

 7  Reemployment of a retired member as a substitute or hourly

 8  teacher is limited to 780 hours during the first 12 months of

 9  his or her retirement.  Any retired member reemployed for more

10  than 780 hours during his or her first 12 months of retirement

11  shall give timely notice in writing to his or her employer and

12  to the division department of the date he or she will exceed

13  the limitation.  The division department shall suspend his or

14  her retirement benefits for the remainder of his or her first

15  12 months of retirement.  Any person employed in violation of

16  this paragraph and any employing agency which knowingly

17  employs or appoints such person without notifying the division

18  department to suspend retirement benefits shall be jointly and

19  severally liable for reimbursement to the retirement trust

20  fund of any benefits paid during the reemployment limitation

21  period.  To avoid liability, such employing agency shall have

22  a written statement from the retiree that he or she is not

23  retired from a state-administered retirement system.  Any

24  retirement benefits received by a retired member while

25  reemployed in excess of 780 hours during his or her first 12

26  months of retirement shall be repaid to the Retirement System

27  Trust Fund, and his or her retirement benefits shall remain

28  suspended until repayment is made.  Benefits suspended beyond

29  the end of the retired member's first 12 months of retirement

30  shall apply toward repayment of benefits received in violation

31  of the 780-hour reemployment limitation.

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 1         (d)  A community college board of trustees may reemploy

 2  a retired member as an adjunct instructor, that is, an

 3  instructor who is noncontractual and part time, or as a

 4  participant in a phased retirement program within a community

 5  college, after he or she has been retired for 1 calendar

 6  month, in accordance with s. 121.021(39).  Any retired member

 7  who is reemployed within 1 calendar month after retirement

 8  shall void his or her application for retirement benefits.

 9  Boards of trustees reemploying such instructors are subject to

10  the retirement contribution required in paragraph (g).  A

11  retired member may be reemployed as an adjunct instructor for

12  no more than 780 hours during the first 12 months of his or

13  her retirement.  Any retired member reemployed for more than

14  780 hours during his or her first 12 months of retirement

15  shall give timely notice in writing to his or her employer and

16  to the division department of the date he or she will exceed

17  the limitation. The division department shall suspend his or

18  her retirement benefits for the remainder of his or her first

19  12 months of retirement.  Any person employed in violation of

20  this paragraph and any employing agency which knowingly

21  employs or appoints such person without notifying the division

22  department to suspend retirement benefits shall be jointly and

23  severally liable for reimbursement to the retirement trust

24  fund of any benefits paid during the reemployment limitation

25  period.  To avoid liability, such employing agency shall have

26  a written statement from the retiree that he or she is not

27  retired from a state-administered retirement system.  Any

28  retirement benefits received by a retired member while

29  reemployed in excess of 780 hours during his or her first 12

30  months of retirement shall be repaid to the Retirement System

31  Trust Fund, and retirement benefits shall remain suspended

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 1  until repayment is made. Benefits suspended beyond the end of

 2  the retired member's first 12 months of retirement shall apply

 3  toward repayment of benefits received in violation of the

 4  780-hour reemployment limitation.

 5         (e)  The Board of Trustees of the Florida School for

 6  the Deaf and the Blind may reemploy a retired member as a

 7  substitute teacher, substitute residential instructor, or

 8  substitute nurse on a noncontractual basis after he or she has

 9  been retired for 1 calendar month, in accordance with s.

10  121.021(39). Any retired member who is reemployed within 1

11  calendar month after retirement shall void his or her

12  application for retirement benefits. The Board of Trustees of

13  the Florida School for the Deaf and the Blind reemploying such

14  teachers, residential instructors, or nurses is subject to the

15  retirement contribution required by paragraph (g).

16  Reemployment of a retired member as a substitute teacher,

17  substitute residential instructor, or substitute nurse is

18  limited to 780 hours during the first 12 months of his or her

19  retirement. Any retired member reemployed for more than 780

20  hours during his or her first 12 months of retirement shall

21  give timely notice in writing to his or her employer and to

22  the division department of the date he or she will exceed the

23  limitation.  The division department shall suspend his or her

24  retirement benefits for the remainder of his or her first 12

25  months of retirement.  Any person employed in violation of

26  this paragraph and any employing agency which knowingly

27  employs or appoints such person without notifying the division

28  department to suspend retirement benefits shall be jointly and

29  severally liable for reimbursement to the retirement trust

30  fund of any benefits paid during the reemployment limitation

31  period.  To avoid liability, such employing agency shall have

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 1  a written statement from the retiree that he or she is not

 2  retired from a state-administered retirement system.  Any

 3  retirement benefits received by a retired member while

 4  reemployed in excess of 780 hours during his or her first 12

 5  months of retirement shall be repaid to the Retirement System

 6  Trust Fund, and his or her retirement benefits shall remain

 7  suspended until payment is made.  Benefits suspended beyond

 8  the end of the retired member's first 12 months of retirement

 9  shall apply toward repayment of benefits received in violation

10  of the 780-hour reemployment limitation.

11         (f)  The State University System may reemploy a retired

12  member as an adjunct faculty member or as a participant in a

13  phased retirement program within the State University System

14  after the retired member has been retired for 1 calendar

15  month, in accordance with s. 121.021(39).  Any retired member

16  who is reemployed within 1 calendar month after retirement

17  shall void his or her application for retirement benefits. The

18  State University System is subject to the retired contribution

19  required in paragraph (g), as appropriate. A retired member

20  may be reemployed as an adjunct faculty member or a

21  participant in a phased retirement program for no more than

22  780 hours during the first 12 months of his or her retirement.

23  Any retired member reemployed for more than 780 hours during

24  his or her first 12 months of retirement shall give timely

25  notice in writing to his or her employer and to the division

26  department of the date he or she will exceed the limitation.

27  The division department shall suspend his or her retirement

28  benefits for the remainder of his or her first 12 months of

29  retirement.  Any person employed in violation of this

30  paragraph and any employing agency which knowingly employs or

31  appoints such person without notifying the division department

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 1  to suspend retirement benefits shall be jointly and severally

 2  liable for reimbursement to the retirement trust fund of any

 3  benefits paid during the reemployment limitation period.  To

 4  avoid liability, such employing agency shall have a written

 5  statement from the retiree that he or she is not retired from

 6  a state-administered retirement system.  Any retirement

 7  benefits received by a retired member while reemployed in

 8  excess of 780 hours during his or her first 12 months of

 9  retirement shall be repaid to the Retirement System Trust

10  Fund, and retirement benefits shall remain suspended until

11  repayment is made.  Benefits suspended beyond the end of the

12  retired member's first 12 months of retirement shall apply

13  toward repayment of benefits received in violation of the

14  780-hour reemployment limitation.

15         (g)  The employment by an employer of any retiree of a

16  state-administered retirement system shall have no effect on

17  the average final compensation or years of creditable service

18  of such retiree.  Prior to July 1, 1991, upon employment of

19  any person, other than an elected officer as provided in s.

20  121.053, who has been retired under any state-administered

21  retirement program, the employer shall pay retirement

22  contributions in an amount equal to the unfunded actuarial

23  accrued liability portion of the employer contribution which

24  would be required for a regular member of the Florida

25  Retirement System. Effective July 1, 1991, contributions shall

26  be made as provided in s. 121.122 for renewed membership.

27         (h)  The limitations of this subsection apply to

28  reemployment in any capacity with an "employer" as defined in

29  s. 121.021(10), irrespective of the category of funds from

30  which the person is compensated.

31  

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 1         Section 91.  Section 238.32, Florida Statutes, is

 2  amended to read:

 3         238.32  Service credit in disputed cases.--The division

 4  Department of Management Services may in its discretion allow

 5  or deny a member service credit in disputed or doubtful cases

 6  for employment in Florida and out-of-state schools in order to

 7  serve the best interests of the state and the member, subject

 8  to the membership dates set forth in s. 238.06(4).

 9         Section 92.  Subsection (4) of section 650.02, Florida

10  Statutes, is amended to read:

11         650.02  Definitions.--For the purpose of this chapter:

12         (4)  The term "state agency" means the Division of

13  Retirement of the State Board of Administration Department of

14  Management Services.

15         Section 93.  Subsection (1) of section 650.06, Florida

16  Statutes, is amended to read:

17         650.06  Social Security Contribution Trust Fund.--

18         (1)  There is hereby established in the State Treasury

19  to be administered by the State Board of Administration a

20  special fund to be known as the "Social Security Contribution

21  Trust Fund." Such fund shall consist of and there shall be

22  deposited in such fund:

23         (a)  All contributions, interest, and penalties

24  collected under ss. 650.04 and 650.05;

25         (b)  All moneys appropriated thereto under this

26  chapter;

27         (c)  Any property or securities and earnings thereof

28  acquired through the use of moneys belonging to the fund;

29         (d)  Interest earned upon any moneys in the fund; and

30         (e)  All sums recovered upon the bond of the custodian

31  or otherwise for losses sustained by the fund and all other

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 1  moneys received for the fund from any other source.  All

 2  moneys in the fund shall be mingled and undivided. Subject to

 3  the provisions of this chapter, the state agency is vested

 4  with full power, authority and jurisdiction over the fund,

 5  including all moneys and property or securities belonging

 6  thereto, and may perform any and all acts whether or not

 7  specifically designated, which are necessary to the

 8  administration thereof and are consistent with the provisions

 9  of this chapter.

10         Section 94.  The Department of Management Services may

11  contract with the State Board of Administration to administer

12  sections 112.05, 121.1815, 238.171, 250.22, and

13  112.351-112.362, Florida Statutes.

14         Section 95.  The Division of Retirement of the State

15  Board of Administration is a state agency for the purpose of

16  making payments under the retirement plans and other benefit

17  programs administered by the board and the Division of

18  Retirement.  The Department of Financial Services shall issue

19  benefit payments to persons or governmental entities eligible

20  for such payments under the retirement plans and other benefit

21  programs administered by the board and the Division of

22  Retirement.  The board is authorized to requisition the

23  appropriate amounts from trust funds in the State Treasury

24  established for this purpose.

25         Section 96.  The following trust funds are transferred

26  from the Department of Management Services to the State Board

27  of Administration:

28         (a)  The Florida Retirement System Trust Fund, FLAIR

29  number 72-2-309;

30         (b)  The Florida Retirement System Preservation of

31  Benefits Trust Fund, FLAIR number 72-2-345;

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 1         (c)  The Institute of Food and Agricultural Sciences

 2  Supplemental Retirement Trust Fund, FLAIR number 72-2-379;

 3         (d)  The Senior Management Service Optional Annuity

 4  Program Trust Fund, FLAIR number 72-2-515;

 5         (e)  The Optional Retirement Program Trust Fund, FLAIR

 6  number 72-2-517;

 7         (f)  The Police and Firefighters' Premium Tax Trust

 8  Fund, FLAIR number 72-2-532;

 9         (g)  The Social Security Contribution Trust Fund, FLAIR

10  number 72-2-638;

11         (h)  The Florida Retirement System Contributions

12  Clearing Trust Fund, FLAIR number 72-2-705;

13         (i)  The Operating Trust Fund, FLAIR number 72-2-510;

14         (j)  The Retiree Health Insurance Subsidy Trust Fund,

15  FLAIR number 72-2-583; and

16         (k)  The State Employee Savings Bonds Trust Fund, FLAIR

17  number 72-2-674.

18         Section 97.  This act shall take effect July 1, 2004.

19  

20          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
21                          CS for SB 286

22                                 

23  Reinstates current law regarding the funding of disability
    benefits for disabled judges from the General Revenue Fund
24  rather than the Florida Retirement System.

25  Transfers trust funds used by the Division of Retirement from
    the Department of Management Services to the State Board of
26  Administration.

27  

28  

29  

30  

31  

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