HB 1033

1	A bill to be entitled
2	An act relating to the Police Pension Fund of the City of
3	West Palm Beach, Palm Beach County; amending chapter 24981
4	(1947), Laws of Florida, as amended; revising the
5	definition of "retirement"; providing applicability of
6	certain investment policy guidelines; providing statutory
7	limitations on investments in foreign investments;
8	providing additional standards for the performance of
9	duties by the Board of Trustees relating to investments;
10	deleting provisions relating to investments and purchases
11	of securities, uninvested cash, and minimum investment
12	standards; providing for transfer to the fund of certain
13	members' leave payments remaining after required
14	contributions to health savings accounts; providing for
15	reemployment after retirement by a public or private
16	employer, reemployment after retirement inside or outside
17	the police department, reemployment of terminated vested
18	persons, and reemployment of DROP participants; providing
19	an effective date.
20
21	Be It Enacted by the Legislature of the State of Florida:
22
23	Section 1.  Paragraph (o) of subsection (2) and subsections
24	(21) and (31) of section 16 of chapter 24981 (1947), Laws of
25	Florida, as amended by chapters 2002-359 and 2005-312, Laws of
26	Florida, are amended, and subsection (36) is added to that
27	section, to read:
28	Section 16.  West Palm Beach Police Pension Fund.--
29	(2)  Definitions.--The following words or phrases, as used
30	in this act, shall have the following meanings, unless a
31	different meaning is clearly indicated by the context:
32	(o)  "Retirement" means a member's withdrawal from Police
33	Department City employment as a police officer with a pension
34	payable from the Fund.
35	(21)  Investments.--
36	(a)  The Board shall have the power and authority to invest
37	and reinvest the moneys of the Fund and to hold, purchase, sell,
38	assign, transfer, and dispose of any securities and investments
39	held in the Fund, including the power and authority to employ
40	counseling or investment management services. The aim of the
41	investment policies shall be to preserve the integrity and
42	security of Fund principal, to maintain a balanced investment
43	portfolio, to maintain and enhance the value of the Fund
44	principal, and to secure the maximum total return on investments
45	that is consonant with safety of principal, provided that such
46	investments and reinvestments shall be limited only by the
47	investments permitted by the investment policy guidelines
48	adopted by the Board in accordance with Florida law.
49	Notwithstanding the foregoing, investments in foreign
50	investments are limited in accordance with section
51	185.06(1)(b)4., Florida Statutes. The Board members must
52	discharge these duties with respect to the Plan solely in the
53	interest of the participants and beneficiaries and:
54	1.  For the exclusive purpose of providing benefits to
55	participants and their beneficiaries and defraying reasonable
56	expenses of administering the Plan;
57	2.  With the care, skill, prudence, and diligence under the
58	circumstances then prevailing that a prudent person acting in a
59	like capacity and familiar with such matters would use in the
60	conduct of an enterprise of a like character and with like aims;
61	and
62	3.  By diversifying the investments of the Plan so as to
63	minimize the risk of large losses, unless under the
64	circumstances it is clearly prudent not to do so. to the
65	following:
66	1.  Direct obligations of the United States Government or
67	any agency thereof and any other evidences of indebtedness which
68	are fully guaranteed by the United States Government or any
69	agency thereof for the payments of principal and interest.
70	2.  Direct obligations of the State of Florida.
71	3.  Debt securities, preferred and common stocks and mutual
72	fund shares subject to limitations set forth in this section.
73	4.  Savings and loans associations, to the extent that
74	deposits are guaranteed by the United States Government or any
75	agency thereof.
76
77	Purchases of securities may include bonds or other evidence of
78	indebtedness, preferred stocks, and common stocks. Operations
79	shall be conducted on the basis of a balanced portfolio, the
80	total thereof invested in preferred stocks shall not aggregate
81	more than 5 percent, and the total amount thereof invested in
82	common stocks and mutual funds shall not aggregate more than 70
83	percent of the Fund. Percentages shall be based on market value
84	at the end of each reporting period (September 30). Investment
85	experience producing a market value percent exceeding the stated
86	limit does not arbitrarily mean assets are to be liquidated to
87	satisfy the limit.
88	(b)  Maximum uninvested cash; minimum investment
89	standards.--No more than 10 percent of the assets of the Fund
90	shall be held in cash or in noninterest-bearing deposits. The
91	following minimum investment standards shall govern the
92	eligibility for the purchase of securities:
93	1.  All corporate and association securities and mutual
94	funds shall be issued by a corporation or other legal person
95	incorporated or otherwise organized within the United States and
96	domiciled therein except as otherwise permitted by section
97	185.06, Florida Statutes.
98	2.  Not more than 10 percent of the total fund principal at
99	market value may be invested in any issuing company, other than
100	United States Government or United States Government agency
101	obligations.
102	3.  All bonds, stocks, or other evidence of indebtedness
103	shall be issued or guaranteed by a corporation organized under
104	the laws of the United States, any state or organized territory
105	of the United States, or the District of Columbia, provided that
106	the corporation is listed on any one or more of the recognized
107	national stock exchanges and, with regard to bonds only, holds a
108	rating in one of the four highest classifications by a major
109	rating service. Said bonds and preferred stocks that are
110	convertible into common stocks shall be considered common
111	stocks, and the purchase of same shall be limited by the
112	provisions of subparagraph (a)5.
113	(b)4.  Professional counsel.--The Board shall be required
114	to engage the services of professional investment counsel to
115	assist and advise the Trustees in the performance of their
116	duties.
117	(c)  Restricted use of assets.--The assets of the Police
118	Pension Fund shall be used only for the payment of benefits and
119	other disbursements authorized by this act and shall be used for
120	no other purpose.
121	(d)  Performance evaluation and manager selection.--At
122	least once every 3 years, the Board of Trustees shall retain an
123	independent consultant professionally qualified to evaluate the
124	performance of its professional money manager or investment
125	counsel. The independent consultant shall make recommendations
126	to the Board of Trustees regarding the selection of money
127	managers for the next investment term. These recommendations
128	shall be considered by the Board of Trustees at its next
129	regularly scheduled meeting. The date, time, place, and subject
130	of this meeting shall be advertised in a newspaper of general
131	circulation in the municipality at least 10 days prior to the
132	date of the hearing.
133	(e)  Administrative expenses.--The administrative expenses
134	of the Fund shall be paid by the Fund.
135	(31)(a)  Rollovers from qualified plans.--A member may roll
136	over all or a part of his or her interest in another qualified
137	plan to the Fund, provided all of the following requirements are
138	met:
139	1.  Some or all of the amount distributed from the other
140	plan is rolled over to this plan no later than the 60th day
141	after distribution was made from the Plan or, if distributions
142	are made in installments, no later than the 60th day after the
143	last distribution was made.
144	2.  The amount rolled over to this Fund does not include
145	any amount contributed by the member to the Plan on a posttax
146	basis.
147	3.  The rollover is made in cash.
148	4.  The member certifies that the distribution is eligible
149	for a rollover.
150	5.  Any amount which the Trustees accept as a rollover to
151	this Fund shall, along with any earnings allocated to them, be
152	fully vested at all times.
153
154	A rollover may also be made to this Plan from an individual
155	retirement account qualified under s. 408 of the Internal
156	Revenue Code when the individual retirement account was merely
157	used as a conduit for funds from another qualified plan and the
158	rollover is made in accordance with the rules provided in
159	subparagraphs 1.-5. Amounts rolled over may be segregated from
160	other Fund assets. The trustees shall separately account for
161	gains, losses, and administrative expenses of these rollovers as
162	provided for in subsections (11) and (13). In addition, the Fund
163	may accept the direct transfer of a member's benefits from
164	another qualified retirement plan or an Internal Revenue Code
165	section 457 plan. The Fund shall account for direct transfers in
166	the same manner as a rollover and shall obtain certification
167	from the member that the amounts are eligible for a rollover or
168	direct transfer to this Fund.
169	(b)  Transfer of accumulated leave.--
170	1.  Members who are eligible to receive a lump-sum payment
171	for accumulated sick leave, accumulated vacation leave, or any
172	other accumulated leave payable upon separation and who have
173	funds remaining after the contributions to the health savings
174	account as required by the collective bargaining agreement shall
175	have the remaining leave payment transferred to the Fund up to
176	the amount permitted by law. Any additional amounts shall be
177	paid directly to the member. Members on whose behalf leave has
178	been transferred shall maintain the entire amount of the
179	transferred leave balance in the DROP or Share Account.
180	2.  If a member on whose behalf the City makes a
181	transferred leave balance to the Plan dies after retirement or
182	other separation, then any person who would have received a
183	death benefit had the member died in service immediately prior
184	to the date of retirement or other separation shall be entitled
185	to receive an amount equal to the transferred leave balance in a
186	lump sum. In the case of a surviving spouse or former spouse, an
187	election may be made to transfer the leave balance to an
188	eligible retirement plan in lieu of the lump sum payment.
189	Failure to make such an election by the surviving spouse or
190	former spouse within 60 days after the member's death shall be
191	deemed an election to receive the lump sum payment.
192	3.  The Board, by rule, shall prescribe the method for
193	implementing the provisions of this paragraph.
194	4.  Amounts transferred under this section shall remain
195	invested in the Fund for a period of not less than 1 year.
196	(36)  Reemployment after retirement.--
197	(a)  Reemployment by public or private employer.--Any
198	retiree who is retired under this Plan, except for disability
199	retirement as previously provided for, may be reemployed by any
200	public or private employer, except the City, and may receive
201	compensation from that employment without limiting or
202	restricting in any way the retirement benefits payable under
203	this Plan. Reemployment by the City on or after August 1, 2008,
204	shall be subject to the limitations set forth in this section.
205	(b)  Reemployment after normal retirement outside Police
206	Department.--Any retiree who is retired under normal retirement
207	pursuant to this Plan and who is reemployed by the City after
208	that retirement shall, upon being reemployed, continue receipt
209	of benefits, provided the retiree is not hired into the Police
210	Department. Upon reemployment, the retiree is eligible to
211	participate in the plan offered to new employees of that
212	department, and the retiree shall be deemed a new employee
213	subject to any vesting and contribution requirements of that
214	plan. The benefit paid under this Plan shall not be changed in
215	any way.
216	(c)  Reemployment after normal retirement in Police
217	Department.--Any retiree who is retired after normal retirement
218	pursuant to this Plan shall not be reemployed by the Police
219	Department as a police officer or in any position that
220	supervises police officers. The pension of a retiree who is
221	reemployed by the Police Department as a police officer or in
222	any position that supervises police officers shall stop until
223	the member terminates employment. However, a retiree who is
224	reemployed by the Police Department neither as a police officer
225	nor in any position that supervises police officers is eligible
226	to participate in the plan offered to new employees of that
227	employee classification, and the retiree shall be deemed a new
228	employee subject to any vesting and contribution requirements of
229	that plan. The benefit paid under this Plan shall not be changed
230	in any way.
231	(d)  Reemployment of terminated vested persons.--Reemployed
232	terminated vested persons shall not be subject to the provisions
233	of this section until such time as they begin to actually
234	receive benefits but shall be subject to paragraph (9)(c). Upon
235	receipt of benefits, terminated vested persons shall be treated
236	as normal retirees for purposes of applying the provisions of
237	this section.
238	(e)  DROP participants.--Members or retirees who were in
239	the deferred retirement option plan shall have the options
240	provided for in this section for reemployment after termination
241	of employment as if the retiree were a retiree under normal
242	retirement.
243	Section 2.  This act shall take effect upon becoming a law.

CODING: Words stricken are deletions; words underlined are additions.