Florida Senate - 2008 PROPOSED COMMITTEE SUBSTITUTE

Bill No. CS for CS for SB 1428

485700

585-06996A-08

Proposed Committee Substitute by the Committee on Governmental

Operations

A bill to be entitled

An act relating to retirement; amending s. 121.021, F.S.;

clarifying the definition of the term "compensation" for

purposes of the benefit retirement program or the Public

Employee Optional Retirement Program of the Florida

Retirement System; providing that such term does not

include fees or salary payments made from a faculty

practice plan authorized by the Board of Governors of the

State University System for clinical faculty at a state

university having a faculty practice plan; amending s.

121.051, F.S.; requiring that a person appointed to a

faculty position at a state university having a faculty

practice plan participate in the optional retirement

program of the State University System rather than the

Florida Retirement System; providing definitions; amending

s. 121.35, F.S.; requiring the participating employee in

the optional retirement program to execute a contract with

a designated company in order for certain purposes;

defining the term "participant's gross monthly

compensation" for purposes of the optional retirement

program for the State University System; creating s.

121.355, F.S.; authorizing certain former participants in

the Community College Optional Retirement Program or the

State University System Optional Retirement Program and

current mandatory participants in the Florida Retirement

System to receive a specified amount of service credit

under certain conditions; providing a specified time

period for the election of such transfer; limiting certain

service credit; amending s. 121.021, F.S.; revising the

definition of the term "termination" to account for

retirements occurring before and after a specified date,

as applicability to the Deferred Retirement Option

Program; amending s. 121.053, F.S.; providing that

retirees who initially served in an elected office are

ineligible to participate in certain retirement programs;

amending s. 121.091, F.S.; revising limitations on the

payment of retirement contributions for certain retired

persons who become reemployed by an entity participating

in a state-administered retirement system; prohibiting

certain persons holding public office from electing to

retire while continuing employment in the elected office;

providing certain limitations for DROP participants;

amending s. 121.122, F.S.; providing that certain persons

are ineligible for renewed membership in the system;

amending s. 121.35, F.S.; clarifying the definition of

"termination of employment"; amending s. 121.4501, F.S.;

limiting the definition of "eligible employee"; excluding

certain persons from classification as an "eligible

employee"; amending s. 121.591, F.S.; clarifying the

definition of "termination of employment"; providing an

effective date.

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

Section 1. Paragraph (b) of subsection (22) of section

121.021, Florida Statutes, is amended to read:

121.021 Definitions.--The following words and phrases as

used in this chapter have the respective meanings set forth

unless a different meaning is plainly required by the context:

(22) "Compensation" means the monthly salary paid a member

by his or her employer for work performed arising from that

employment.

(b) Under no circumstances shall compensation for a member

participating in the defined benefit retirement program or the

Public Employee Optional Retirement Program of the Florida

Retirement System include:

1. Fees paid professional persons for special or particular

services or include salary payments made from a faculty practice

plan authorized by the Board of Governors of the State University

System for eligible clinical faculty at a college at a state

university with a faculty practice plan; or

2. Any bonuses or other payments prohibited from inclusion

in the member's average final compensation and defined in

subsection (47).

Section 2. Paragraph (a) of subsection (1) of section

121.051, Florida Statutes, is amended to read:

121.051 Participation in the system.--

(1) COMPULSORY PARTICIPATION.--

(a) The provisions of this section are law shall be

compulsory for as to all officers and employees, except elected

officers who meet the requirements of s. 121.052(3), who are

employed on or after December 1, 1970, of an employer other than

those referred to in paragraph (2)(b), and each officer or

employee, as a condition of employment, shall become a member of

the system as of his or her date of employment, except that a

person who is retired from any state retirement system and is

reemployed on or after December 1, 1970, may shall not be

permitted to renew his or her membership in any state retirement

system except as provided in s. 121.091(4)(h) for a person who

recovers from disability, and as provided in s. 121.091(9)(b)8.

for a person who is elected to public office, and, effective July

1, 1991, as provided in s. 121.122 for all other retirees.

Officers and employees of the University Athletic Association,

Inc., a nonprofit association connected with the University of

Florida, employed on and after July 1, 1979, may shall not

participate in any state-supported retirement system.

1. Any person appointed on or after July 1, 1989, to a

faculty position in a college at the J. Hillis Miller Health

Center at the University of Florida or the Medical Center at the

100

University of South Florida which has a faculty practice plan

101

provided by rule adopted by the Board of Regents may shall not

102

participate in the Florida Retirement System.

103

2. Any person appointed on or after July 1, 2008, to a

104

faculty position, including clinical faculty, in a college at a

105

state university having a faculty practice plan authorized by the

106

Board of Governors may not participate in the Florida Retirement

107

System. A faculty member so appointed shall participate in the

108

optional retirement program for the State University System on

109

the basis of his or her state-funded compensation,

110

notwithstanding the provisions of s. 121.35(2)(a).

111

3. For purposes of this paragraph, the term:

112

a. "Faculty position" means a position assigned the

113

principal responsibility of teaching, research, or public service

114

activities or administrative responsibility directly related to

115

the academic mission of the college.

116

b. "Clinical faculty" means a faculty position appointment

117

in conjunction with a professional position in a hospital or other

118

clinical environment at a college.

119

c. "Faculty practice plan" includes professional services to

120

patients, institutions, or other parties rendered by the clinical

121

faculty employed by a college with a faculty practice plan at a

122

state university authorized by the Board of Governors.

123

Section 3. Paragraph (a) of subsection (4) of section

124

121.35, Florida Statutes, is amended, and paragraph (g) is added

125

to that subsection, to read:

126

121.35 Optional retirement program for the State University

127

System.--

128

(4) CONTRIBUTIONS.--

129

(a) Through June 30, 2001, each employer shall contribute

130

on behalf of each participant in the optional retirement program

131

an amount equal to the normal cost portion of the employer

132

retirement contribution which would be required if the

133

participant were a regular member of the Florida Retirement

134

System defined benefit program, plus the portion of the

135

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

136

be assigned to the Retiree Health Insurance Subsidy Trust Fund.

137

Effective July 1, 2001, each employer shall contribute on behalf

138

of each participant in the optional program an amount equal to

139

10.43 percent of the participant's gross monthly compensation.

140

The department shall deduct an amount approved by the Legislature

141

to provide for the administration of this program. The payment of

142

the contributions to the optional program which is required by

143

this paragraph for each participant shall be made by the employer

144

to the department, which shall forward the contributions to the

145

designated company or companies contracting for payment of

146

benefits for the participant under the program. However, such

147

contributions paid on behalf of an employee described in

148

paragraph (3)(c) may shall not be forwarded to a company and does

149

shall not begin to accrue interest until the employee has

150

executed a an annuity contract and notified the department.

151

(g) Effective July 1, 2008, for purposes of paragraph (a)

152

and notwithstanding s. 121.021(22)(b)1., the term "participant's

153

gross monthly compensation" includes salary payments made to

154

eligible clinical faculty from a state university using funds

155

provided by a faculty practice plan authorized by the Board of

156

Governors of the State University System if:

157

1. There is no employer contribution from the state

158

university to any other retirement program with respect to such

159

salary payments; and

160

2. The employer contribution on behalf of the participant

161

in the optional retirement program with respect to such salary

162

payments is made using funds provided by the faculty practice

163

plan.

164

Section 4. Section 121.355, Florida Statutes, is created to

165

read:

166

121.355 Community College Optional Retirement Program and

167

State University System Optional Retirement Program member

168

transfer.--Effective January 1, 2009, through December 31, 2009,

169

an employee who is a former participant in the Community College

170

Optional Retirement Program or the State University System

171

Optional Retirement Program and is presently a mandatory

172

participant in the Florida Retirement System defined benefit plan

173

may receive service credit equal to his or her years of service

174

under the Community College Optional Retirement Program or the

175

State University System Optional Retirement Program under the

176

following conditions:

177

(1) The cost for such credit shall be an amount

178

representing the actuarial accrued liability for the affected

179

period of service. The cost shall be calculated using the

180

discount rate and other relevant actuarial assumptions used to

181

value the Florida Retirement System defined benefit plan

182

liabilities in the most recent actuarial valuation. The

183

calculation shall include any service already maintained under

184

the defined benefit plan in addition to the years under the

185

Community College Optional Retirement Program or the State

186

University System Optional Retirement Program. The actuarial

187

accrued liability of any service already maintained under the

188

defined benefit plan shall be applied as a credit to total cost

189

resulting from the calculation. The division shall ensure that

190

the transfer sum is prepared using a formula and methodology

191

certified by an enrolled actuary.

192

(2) The employee must transfer from his or her Community

193

College Optional Retirement Program account or State University

194

System Optional Retirement Program account, subject to the terms

195

of the applicable optional retirement program contract, and from

196

other employee moneys as necessary, a sum representing the

197

actuarial accrued liability immediately following the time of

198

such movement, determined pursuant to the assumption that

199

attained service equals the sum of service in the defined benefit

200

program and service in the Community College Optional Retirement

201

Program or State University System Optional Retirement Program.

202

(3) The employee may not receive service credit for a

203

period of mandatory participation in the State University

204

Optional Retirement Program or for a period for which a

205

distribution was received from the Community College Optional

206

Retirement Program or State University System Optional Retirement

207

Program.

208

Section 5. Subsection (39) of section 121.021, Florida

209

Statutes, is amended to read:

210

121.021 Definitions.--The following words and phrases as

211

used in this chapter have the respective meanings set forth

212

unless a different meaning is plainly required by the context:

213

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

214

paragraph (b), when:

215

1. For retirements effective before October 1, 2008, a

216

member ceases all employment relationships with employers under

217

this system, as defined in subsection (10); however if, but in

218

the event a member is should be employed by any such employer

219

within the next calendar month, termination shall be deemed not

220

to have occurred. A leave of absence shall constitute a

221

continuation of the employment relationship, except that a leave

222

of absence without pay due to disability may constitute

223

termination for a member, if such member makes application for

224

and is approved for disability retirement in accordance with s.

225

121.091(4). The department or board may require other evidence of

226

termination as it deems necessary.

227

2. For retirements effective on or after October 1, 2008, a

228

member ceases all employment relationships with employers under

229

this system as provided in subsection (10); however, if a member

230

is employed by any such employer within the next 3 calendar

231

months, termination shall be deemed not to have occurred. A leave

232

of absence shall constitute a continuation of the employment

233

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

234

disability may constitute termination for a member, if such

235

member makes application for and is approved for disability

236

retirement in accordance with s. 121.091(4). The department or

237

board may require other evidence of termination as the department

238

or board deems necessary.

239

(b) "Termination" for a member electing to participate

240

under the Deferred Retirement Option Program occurs when the DROP

241

Deferred Retirement Option Program participant ceases all

242

employment relationships with employers under this system in

243

accordance with s. 121.091(13), but:

244

1. For DROP termination dates before October 1, 2008, if

245

the DROP in the event the Deferred Retirement Option Program

246

participant is should be employed by any such employer within the

247

next calendar month, termination will be deemed not to have

248

occurred, except as provided in s. 121.091(13)(b)4.c. A leave of

249

absence shall constitute a continuation of the employment

250

relationship.

251

2. For DROP termination dates on or after October 1, 2008,

252

if the DROP participant is employed by any such employer within

253

the next 3 calendar months, termination will be deemed not to

254

have occurred, except as provided in s. 121.091(13)(b)4.c. A

255

leave of absence shall constitute a continuation of the

256

employment relationship.

257

Section 6. Subsections (1) and (2) of section 121.053,

258

Florida Statutes, are amended to read:

259

121.053 Participation in the Elected Officers' Class for

260

retired members.--

261

(1)(a)1. Effective October 1, 2008, any retiree of a state-

262

administered retirement system who initially serves in an

263

elective office in a regularly established position with a

264

covered employer may not be enrolled in the Florida Retirement

265

System.

266

2. An elected officer who is elected or appointed to an

267

elective office and is participating in the Deferred Retirement

268

Option Program is subject to termination as provided in s.

269

121.021(39)(b), and reemployment limitations as provided in s.

270

121.091(9), upon completion of his or her DROP participation

271

period.

272

(b) Before October 1, 2008, any member who retired under

273

any existing system as defined in s. 121.021(2), and receives a

274

benefit thereof, and who serves in an office covered by the

275

Elected Officers' Class for a period of at least 6 years, is

276

shall be entitled to receive an additional retirement benefit for

277

such elected officer service prior to July 1, 1990, under the

278

Elected Officers' Class of the Florida Retirement System, as

279

follows:

280

1. Upon completion of 6 or more years of creditable service

281

in an office covered by the Elected Officers' Class, s. 121.052,

282

such member shall notify the administrator of his or her intent

283

to purchase elected officer service prior to July 1, 1990, and

284

shall pay the member contribution applicable for the period being

285

claimed, plus 4 percent interest compounded annually from the

286

first year of service claimed until July 1, 1975, and 6.5 percent

287

interest compounded annually thereafter, until full payment is

288

made to the Florida Retirement System Trust Fund; however, such

289

member may purchase retirement credit under the Elected Officers'

290

Class only for such service as an elected officer.

291

2. Upon payment of the amount specified in subparagraph 1.,

292

the employer shall pay into the Florida Retirement System Trust

293

Fund the applicable employer contribution for the period of

294

elected officer service prior to July 1, 1990, being claimed by

295

the member, plus 4 percent interest compounded annually from the

296

first year of service claimed until July 1, 1975, and 6.5 percent

297

interest compounded annually thereafter, until full payment is

298

made to the Florida Retirement System Trust Fund.

299

(c)(b) Any retired member of the Florida Retirement System,

300

or any existing system as defined in s. 121.021(2), who, on or

301

after July 1, 1990 and through September 30, 2008, is serving in,

302

or is elected or appointed to, an elective office covered by the

303

Elected Officers' Class shall be enrolled in the appropriate

304

subclass of the Elected Officers' Class of the Florida Retirement

305

System, and applicable contributions shall be paid into the

306

Florida Retirement System Trust Fund as provided in s.

307

121.052(7). Pursuant thereto:

308

1. Any such retired member is shall be eligible to continue

309

to receive retirement benefits as well as compensation for the

310

elected officer service for as long as he or she remains in an

311

elective office covered by the Elected Officers' Class.

312

2. If any such member serves in an elective office covered

313

by the Elected Officers' Class and becomes vested under that

314

class, he or she is shall be entitled to receive an additional

315

retirement benefit for such elected officer service.

316

3. Such member is shall be entitled to purchase additional

317

retirement credit in the Elected Officers' Class for any

318

postretirement service performed in an elected position eligible

319

for the Elected Officers' Class prior to July 1, 1990, or in the

320

Regular Class for any postretirement service performed in any

321

other regularly established position prior to July 1, 1991, by

322

paying the applicable Elected Officers' Class or Regular Class

323

employee and employer contributions for the period being claimed,

324

plus 4 percent interest compounded annually from the first year

325

of service claimed until July 1, 1975, and 6.5 percent interest

326

compounded thereafter, until full payment is made to the Florida

327

Retirement System Trust Fund. The contribution for postretirement

328

Regular Class service between July 1, 1985, and July 1, 1991, for

329

which the reemployed retiree contribution was paid, shall be the

330

difference between such contribution and the total applicable

331

contribution for the period being claimed, plus interest. The

332

employer of such member may pay the applicable employer

333

contribution in lieu of the member. If a member does not wish to

334

claim credit for all of the postretirement service for which he

335

or she is eligible, the service the member claims must be the

336

most recent service.

337

4. Creditable service for which credit was received, or

338

which remained unclaimed, at retirement may not be claimed or

339

applied toward service credit earned following renewed

340

membership. However, service earned in accordance with the

341

renewed membership provisions in s. 121.122 may be used in

342

conjunction with creditable service earned under this paragraph,

343

provided applicable vesting requirements and other existing

344

statutory conditions required by this chapter are met.

345

5. An elected officer who is elected or appointed to an

346

elective office and is participating in the Deferred Retirement

347

Option Program before October 1, 2008, is not subject to

348

termination as provided in s. 121.021(39)(b), or reemployment

349

limitations as provided in s. 121.091(9), until the end of his or

350

her current term of office or, if the officer is consecutively

351

elected or reelected to an elective office eligible for coverage

352

under the Florida Retirement System, until he or she no longer

353

holds such an elective office, as follows:

354

a. At the end of the 60-month DROP period:

355

(I) The officer's DROP account shall accrue no additional

356

monthly benefits, but shall continue to earn interest as provided

357

in s. 121.091(13).

358

(II) No retirement contributions shall be required of the

359

employer of the elected officer and no additional retirement

360

credit shall be earned under the Florida Retirement System.

361

b. Nothing herein shall prevent an elected officer from

362

voluntarily terminating his or her elective office at any time

363

and electing to receive his or her DROP proceeds. However, until

364

termination requirements are fulfilled as provided in s.

365

121.021(39), any elected officer whose termination limitations

366

are extended by this section is shall be ineligible for renewed

367

membership in the system and shall receive no pension payments,

368

DROP lump sum payments, or any other state payment other than the

369

statutorily determined salary, travel, and per diem for the

370

elective office.

371

c. Upon termination, the officer shall receive his or her

372

accumulated DROP account, plus interest, and shall accrue and

373

commence receiving monthly retirement benefits, which shall be

374

paid on a prospective basis only.

375

376

However, an officer electing to participate in the Deferred

377

Retirement Option Program on or before June 30, 2002, is shall

378

not be required to terminate and remains shall remain subject to

379

the provisions of this subparagraph as adopted in section 1 of

380

chapter 2001-235, Laws of Florida.

381

(2) Upon attaining his or her normal retirement date and

382

payment of the amount specified in paragraphs (1)(b) (a) and (c)

383

(b), and upon application to the administrator of the intent to

384

retire, the member shall receive a monthly benefit under this

385

section, in addition to any benefits already being received,

386

which shall commence on the last day of the month of retirement

387

and be payable on the last day of the month thereafter during his

388

or her lifetime. The amount of such monthly benefit shall be the

389

total percentage of retirement credit purchased under this

390

section multiplied by the member's average monthly compensation

391

as an elected officer, adjusted according to the option selected

392

at retirement under s. 121.091(6).

393

Section 7. Paragraph (b) of subsection (9) and subsection

394

(13) of section 121.091, Florida Statutes, are amended to read:

395

121.091 Benefits payable under the system.--Benefits may

396

not be paid under this section unless the member has terminated

397

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

398

participation in the Deferred Retirement Option Program as

399

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

400

filed in the manner prescribed by the department. The department

401

may cancel an application for retirement benefits when the member

402

or beneficiary fails to timely provide the information and

403

documents required by this chapter and the department's rules.

404

The department shall adopt rules establishing procedures for

405

application for retirement benefits and for the cancellation of

406

such application when the required information or documents are

407

not received.

408

(9) EMPLOYMENT AFTER RETIREMENT; LIMITATION.--

409

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

410

under the disability retirement provisions of subsection (4), may

411

be reemployed by any private or public employer after retirement

412

and receive retirement benefits and compensation from the his or

413

her employer without any limitations, except that a person may

414

not receive both a salary from reemployment with any agency

415

participating in the Florida Retirement System and retirement

416

benefits under this chapter for a period of 12 months immediately

417

subsequent to the date of retirement. However, a DROP participant

418

shall continue employment and receive a salary during the period

419

of participation in DROP the Deferred Retirement Option Program,

420

as provided in subsection (13).

421

2. Any person to whom the limitation in subparagraph 1.

422

applies who violates such reemployment limitation and who is

423

reemployed with any agency participating in the Florida

424

Retirement System before completion of the 12-month limitation

425

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

426

employer and to the Division of Retirement and shall have his or

427

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

428

limitation period. Any person employed in violation of this

429

paragraph and any employing agency that which knowingly employs

430

or appoints such person without notifying the division of

431

Retirement to suspend retirement benefits are shall be jointly

432

and severally liable for reimbursement to the retirement trust

433

fund of any benefits paid during the reemployment limitation

434

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

435

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

436

from a state-administered retirement system. Any retirement

437

benefits received while reemployed during this reemployment

438

limitation period shall be repaid to the Florida Retirement

439

System Trust Fund, and retirement benefits shall remain suspended

440

until such repayment has been made. Benefits suspended beyond the

441

reemployment limitation shall apply toward repayment of benefits

442

received in violation of the reemployment limitation.

443

3. A district school board may reemploy a retired member as

444

a substitute or hourly teacher, education paraprofessional,

445

transportation assistant, bus driver, or food service worker on a

446

noncontractual basis after he or she has been retired and met the

447

definition of termination in for 1 calendar month, in accordance

448

with s. 121.021(39). A district school board may reemploy a

449

retired member as instructional personnel, as defined in s.

450

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

451

been retired and met the definition of termination in for 1

452

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

453

retired member who is reemployed before meeting the definition of

454

termination within 1 calendar month after retirement shall void

455

his or her application for retirement benefits. District school

456

boards reemploying such teachers, education paraprofessionals,

457

transportation assistants, bus drivers, or food service workers

458

are subject to the retirement contribution required by

459

subparagraph 7.

460

4. A community college board of trustees may reemploy a

461

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

462

who is noncontractual and part-time, or as a participant in a

463

phased retirement program within the Florida Community College

464

System, after he or she has been retired and met the definition

465

of termination in for 1 calendar month, in accordance with s.

466

121.021(39). Any retired member who is reemployed before meeting

467

the definition of termination within 1 calendar month after

468

retirement shall void his or her application for retirement

469

benefits. Boards of trustees reemploying such instructors are

470

subject to the retirement contribution required in subparagraph

471

7. A retired member may be reemployed as an adjunct instructor

472

for no more than 780 hours during the first 12 months of

473

retirement. Any retired member reemployed for more than 780 hours

474

during the first 12 months of retirement shall give timely notice

475

in writing to the employer and to the Division of Retirement of

476

the date he or she will exceed the limitation. The division shall

477

suspend his or her retirement benefits for the remainder of the

478

first 12 months of retirement. Any person employed in violation

479

of this subparagraph and any employing agency that which

480

knowingly employs or appoints such person without notifying the

481

division of Retirement to suspend retirement benefits are shall

482

be jointly and severally liable for reimbursement to the

483

retirement trust fund of any benefits paid during the

484

reemployment limitation period. To avoid liability, such

485

employing agency shall have a written statement from the retiree

486

that he or she is not retired from a state-administered

487

retirement system. Any retirement benefits received by a retired

488

member while reemployed in excess of 780 hours during the first

489

12 months of retirement shall be repaid to the Florida Retirement

490

System Trust Fund, and retirement benefits shall remain suspended

491

until repayment is made. Benefits suspended beyond the end of the

492

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

493

repayment of benefits received in violation of the 780-hour

494

reemployment limitation.

495

5. The State University System may reemploy a retired

496

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

497

phased retirement program within the State University System

498

after the retired member has been retired and met the definition

499

of termination in for 1 calendar month, in accordance with s.

500

121.021(39). Any retired member who is reemployed before meeting

501

the definition of termination within 1 calendar month after

502

retirement shall void his or her application for retirement

503

benefits. The State University System is subject to the retired

504

contribution required in subparagraph 7., as appropriate. A

505

retired member may be reemployed as an adjunct faculty member or

506

a participant in a phased retirement program for no more than 780

507

hours during the first 12 months of his or her retirement. Any

508

retired member reemployed for more than 780 hours during the

509

first 12 months of retirement shall give timely notice in writing

510

to the employer and to the Division of Retirement of the date he

511

or she will exceed the limitation. The division shall suspend his

512

or her retirement benefits for the remainder of the first 12

513

months of retirement. Any person employed in violation of this

514

subparagraph and any employing agency that which knowingly

515

employs or appoints such person without notifying the division of

516

Retirement to suspend retirement benefits are shall be jointly

517

and severally liable for reimbursement to the retirement trust

518

fund of any benefits paid during the reemployment limitation

519

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

520

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

521

from a state-administered retirement system. Any retirement

522

benefits received by a retired member while reemployed in excess

523

of 780 hours during the first 12 months of retirement shall be

524

repaid to the Florida Retirement System Trust Fund, and

525

retirement benefits shall remain suspended until repayment is

526

made. Benefits suspended beyond the end of the retired member's

527

first 12 months of retirement shall apply toward repayment of

528

benefits received in violation of the 780-hour reemployment

529

limitation.

530

6. The Board of Trustees of the Florida School for the Deaf

531

and the Blind may reemploy a retired member as a substitute

532

teacher, substitute residential instructor, or substitute nurse

533

on a noncontractual basis after he or she has been retired and

534

met the definition of termination in for 1 calendar month, in

535

accordance with s. 121.021(39). Any retired member who is

536

reemployed before meeting the definition of termination within 1

537

calendar month after retirement shall void his or her application

538

for retirement benefits. The Board of Trustees of the Florida

539

School for the Deaf and the Blind reemploying such teachers,

540

residential instructors, or nurses is subject to the retirement

541

contribution required by subparagraph 7. Reemployment of a

542

retired member as a substitute teacher, substitute residential

543

instructor, or substitute nurse is limited to 780 hours during

544

the first 12 months of his or her retirement. Any retired member

545

reemployed for more than 780 hours during the first 12 months of

546

retirement shall give timely notice in writing to the employer

547

and to the Division of Retirement of the date he or she will

548

exceed the limitation. The division shall suspend his or her

549

retirement benefits for the remainder of the first 12 months of

550

retirement. Any person employed in violation of this subparagraph

551

and any employing agency that which knowingly employs or appoints

552

such person without notifying the division of Retirement to

553

suspend retirement benefits are shall be jointly and severally

554

liable for reimbursement to the retirement trust fund of any

555

benefits paid during the reemployment limitation period. To avoid

556

liability, such employing agency shall have a written statement

557

from the retiree that he or she is not retired from a state-

558

administered retirement system. Any retirement benefits received

559

by a retired member while reemployed in excess of 780 hours

560

during the first 12 months of retirement shall be repaid to the

561

Florida Retirement System Trust Fund, and his or her retirement

562

benefits shall remain suspended until payment is made. Benefits

563

suspended beyond the end of the retired member's first 12 months

564

of retirement shall apply toward repayment of benefits received

565

in violation of the 780-hour reemployment limitation.

566

7. The employment by an employer of any retiree or former

567

DROP participant of any state-administered retirement system

568

shall have no effect on the average final compensation or years

569

of creditable service of the retiree or DROP participant.

570

a. Prior to July 1, 1991, and for initial enrollment as a

571

renewed member through September 30, 2008, upon employment of any

572

person, other than an elected officer as provided in s. 121.053,

573

who has been retired under any state-administered retirement

574

program, the employer shall pay retirement contributions in an

575

amount equal to the unfunded actuarial liability portion of the

576

employer contribution which would be required for regular members

577

of the Florida Retirement System. Effective July 1, 1991,

578

contributions shall be made as provided in s. 121.122 for

579

retirees with renewed membership or subsection (13) with respect

580

to DROP participants.

581

b. Membership in the Florida Retirement System of any

582

person who has retired under any state-administered retirement

583

program and is initially reemployed may not be renewed, and the

584

employer shall pay retirement contributions in an amount equal to

585

the unfunded actuarial liability portion of the employer

586

contribution which would be required for regular members of the

587

Florida Retirement System.

588

8.a. Any person who has previously retired and who is

589

holding an elective public office or an appointment to an

590

elective public office initially eligible for the Elected

591

Officers' Class on or after July 1, 1990, through September 30,

592

2008, shall be enrolled in the Florida Retirement System as

593

provided in s. 121.053(1)(b) or, if holding an elective public

594

office that does not qualify for the Elected Officers' Class on

595

or after July 1, 1991, shall be enrolled in the Florida

596

Retirement System as provided in s. 121.122, and shall continue

597

to receive retirement benefits as well as compensation for the

598

elected officer's service for as long as he or she remains in

599

elective office. However, any retired member who served in an

600

elective office prior to July 1, 1990, suspended his or her

601

retirement benefit, and had his or her Florida Retirement System

602

membership reinstated shall, upon retirement from such office,

603

have his or her retirement benefit recalculated to include the

604

additional service and compensation earned.

605

b. Any person who has previously retired and who holds an

606

elective public office or an appointment to an elective public

607

office initially eligible for the Elected Officers' Class on or

608

after October 1, 2008, shall not be enrolled in the Florida

609

Retirement System as provided in s. 121.053(1)(b) or, if holding

610

an elective public office that does not qualify for the Elected

611

Officers' Class and is initially eligible on or after October 1,

612

2008, shall not be enrolled in the Retirement System as provided

613

in s. 121.122, and shall not continue to receive retirement

614

benefits during the first 12 months of his or her retirement.

615

9.a. Any person who is holding an elective public office

616

which is covered by the Florida Retirement System and who is

617

concurrently employed in nonelected covered employment before

618

October 1, 2008, may elect to retire while continuing employment

619

in the elective public office, if provided that he or she shall

620

be required to terminate his or her nonelected covered

621

employment. Any person who exercises this election shall receive

622

his or her retirement benefits in addition to the compensation of

623

the elective office without regard to the time limitations

624

otherwise provided in this subsection. No person who seeks to

625

exercise the provisions of this subparagraph, as they the same

626

existed prior to May 3, 1984, shall be deemed to be retired under

627

those provisions, unless such person is eligible to retire under

628

the provisions of this subparagraph, as amended by chapter 84-11,

629

Laws of Florida.

630

b. Any person who is holding an elective public office

631

covered by the Florida Retirement System and who is concurrently

632

employed in nonelected covered employment on or after October 1,

633

2008, may not elect to retire while continuing employment in the

634

elective public office. Such person must meet the definition of

635

termination in s. 121.021(39) and is subject to the limitations

636

provided in this section.

637

10. The limitations of this paragraph apply to reemployment

638

in any capacity with an "employer" as defined in s. 121.021(10),

639

irrespective of the category of funds from which the person is

640

compensated.

641

11. An employing agency may reemploy a retired member as a

642

firefighter or paramedic after the retired member has been

643

retired and met the definition of termination in for 1 calendar

644

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

645

is reemployed before meeting the definition of termination within

646

1 calendar month after retirement shall void his or her

647

application for retirement benefits. The employing agency

648

reemploying such firefighter or paramedic is subject to the

649

retired contribution required in subparagraph 8. Reemployment of

650

a retired firefighter or paramedic is limited to no more than 780

651

hours during the first 12 months of his or her retirement. Any

652

retired member reemployed for more than 780 hours during the

653

first 12 months of retirement shall give timely notice in writing

654

to the employer and to the Division of Retirement of the date he

655

or she will exceed the limitation. The division shall suspend his

656

or her retirement benefits for the remainder of the first 12

657

months of retirement. Any person employed in violation of this

658

subparagraph and any employing agency that which knowingly

659

employs or appoints such person without notifying the division of

660

Retirement to suspend retirement benefits are shall be jointly

661

and severally liable for reimbursement to the retirement System

662

trust fund of any benefits paid during the reemployment

663

limitation period. To avoid liability, such employing agency

664

shall have a written statement from the retiree that he or she is

665

not retired from a state-administered retirement system. Any

666

retirement benefits received by a retired member while reemployed

667

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

668

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

669

retirement benefits shall remain suspended until repayment is

670

made. Benefits suspended beyond the end of the retired member's

671

first 12 months of retirement shall apply toward repayment of

672

benefits received in violation of the 780-hour reemployment

673

limitation.

674

(13) DEFERRED RETIREMENT OPTION PROGRAM.--In general, and

675

subject to the provisions of this section, the Deferred

676

Retirement Option Program, hereinafter referred to as the DROP,

677

is a program under which an eligible member of the Florida

678

Retirement System may elect to participate, deferring receipt of

679

retirement benefits while continuing employment with his or her

680

Florida Retirement System employer. The deferred monthly benefits

681

shall accrue in the System Trust Fund on behalf of the

682

participant, plus interest compounded monthly, for the specified

683

period of the DROP participation, as provided in paragraph (c).

684

Upon termination of employment as required in s. 121.021(39)(b),

685

the participant shall receive the total DROP benefits and begin

686

to receive the previously determined normal retirement benefits.

687

Participation in the DROP does not guarantee employment for the

688

specified period of DROP. Participation in the DROP by an

689

eligible member beyond the initial 60-month period as authorized

690

in this subsection shall be on an annual contractual basis for

691

all participants.

692

(a) Eligibility of member to participate in the DROP.--All

693

active Florida Retirement System members in a regularly

694

established position, and all active members of either the

695

Teachers' Retirement System established in chapter 238 or the

696

State and County Officers' and Employees' Retirement System

697

established in chapter 122 which systems are consolidated within

698

the Florida Retirement System under s. 121.011, are eligible to

699

elect participation in the DROP if provided that:

700

1. The member is not a renewed member of the Florida

701

Retirement System under s. 121.122, or a member of the State

702

Community College System Optional Retirement Program under s.

703

121.051, the Senior Management Service Optional Annuity Program

704

under s. 121.055, or the optional retirement program for the

705

State University System under s. 121.35.

706

2. Except as provided in subparagraph 6., election to

707

participate is made within 12 months immediately following the

708

date on which the member first reaches normal retirement date,

709

or, for a member who reaches normal retirement date based on

710

service before he or she reaches age 62, or age 55 for Special

711

Risk Class members, election to participate may be deferred to

712

the 12 months immediately following the date the member attains

713

57, or age 52 for Special Risk Class members. For a member who

714

first reached normal retirement date or the deferred eligibility

715

date described above prior to the effective date of this section,

716

election to participate shall be made within 12 months after the

717

effective date of this section. A member who fails to make an

718

election within such 12-month limitation period shall forfeit all

719

rights to participate in the DROP. The member shall advise his or

720

her employer and the division in writing of the date on which the

721

DROP shall begin. Such beginning date may be subsequent to the

722

12-month election period, but must be within the 60-month or,

723

with respect to members who are instructional personnel employed

724

by the Florida School for the Deaf and the Blind and who have

725

received authorization by the Board of Trustees of the Florida

726

School for the Deaf and the Blind to participate in the DROP

727

beyond 60 months, or who are instructional personnel as defined

728

in s. 1012.01(2)(a)-(d) in grades K-12 and who have received

729

authorization by the district school superintendent to

730

participate in the DROP beyond 60 months, the 96-month limitation

731

period as provided in subparagraph (b)1. When establishing

732

eligibility of the member to participate in the DROP for the 60-

733

month or, with respect to members who are instructional personnel

734

employed by the Florida School for the Deaf and the Blind and who

735

have received authorization by the Board of Trustees of the

736

Florida School for the Deaf and the Blind to participate in the

737

DROP beyond 60 months, or who are instructional personnel as

738

defined in s. 1012.01(2)(a)-(d) in grades K-12 and who have

739

received authorization by the district school superintendent to

740

participate in the DROP beyond 60 months, the 96-month maximum

741

participation period, the member may elect to include or exclude

742

any optional service credit purchased by the member from the

743

total service used to establish the normal retirement date. A

744

member with dual normal retirement dates shall be eligible to

745

elect to participate in DROP within 12 months after attaining

746

normal retirement date in either class.

747

3. The employer of a member electing to participate in the

748

DROP, or employers if dually employed, shall acknowledge in

749

writing to the division the date the member's participation in

750

the DROP begins and the date the member's employment and DROP

751

participation will terminate.

752

4. Simultaneous employment of a participant by additional

753

Florida Retirement System employers subsequent to the

754

commencement of participation in the DROP shall be permissible

755

provided such employers acknowledge in writing a DROP termination

756

date no later than the participant's existing termination date or

757

the 60-month limitation period as provided in subparagraph (b)1.

758

5. A DROP participant may change employers while

759

participating in the DROP, subject to the following:

760

a. A change of employment must take place without a break

761

in service so that the member receives salary for each month of

762

continuous DROP participation. If a member receives no salary

763

during a month, DROP participation shall cease unless the

764

employer verifies a continuation of the employment relationship

765

for such participant pursuant to s. 121.021(39)(b).

766

b. Such participant and new employer shall notify the

767

division on forms required by the division as to the identity of

768

the new employer.

769

c. The new employer shall acknowledge, in writing, the

770

participant's DROP termination date, which may be extended but

771

not beyond the original 60-month or, with respect to members who

772

are instructional personnel employed by the Florida School for

773

the Deaf and the Blind and who have received authorization by the

774

Board of Trustees of the Florida School for the Deaf and the

775

Blind to participate in the DROP beyond 60 months, or who are

776

instructional personnel as defined in s. 1012.01(2)(a)-(d) in

777

grades K-12 and who have received authorization by the district

778

school superintendent to participate in the DROP beyond 60

779

months, the 96-month period provided in subparagraph (b)1., shall

780

acknowledge liability for any additional retirement contributions

781

and interest required if the participant fails to timely

782

terminate employment, and shall be subject to the adjustment

783

required in sub-subparagraph (c)5.d.

784

6. Effective July 1, 2001, for instructional personnel as

785

defined in s. 1012.01(2), election to participate in the DROP

786

shall be made at any time following the date on which the member

787

first reaches normal retirement date. The member shall advise his

788

or her employer and the division in writing of the date on which

789

the Deferred Retirement Option Program shall begin. When

790

establishing eligibility of the member to participate in the DROP

791

for the 60-month or, with respect to members who are

792

instructional personnel employed by the Florida School for the

793

Deaf and the Blind and who have received authorization by the

794

Board of Trustees of the Florida School for the Deaf and the

795

Blind to participate in the DROP beyond 60 months, or who are

796

instructional personnel as defined in s. 1012.01(2)(a)-(d) in

797

grades K-12 and who have received authorization by the district

798

school superintendent to participate in the DROP beyond 60

799

months, the 96-month maximum participation period, as provided in

800

subparagraph (b)1., the member may elect to include or exclude

801

any optional service credit purchased by the member from the

802

total service used to establish the normal retirement date. A

803

member with dual normal retirement dates shall be eligible to

804

elect to participate in either class.

805

(b) Participation in the DROP.--

806

1. An eligible member may elect to participate in the DROP

807

for a period not to exceed a maximum of 60 calendar months or,

808

with respect to members who are instructional personnel employed

809

by the Florida School for the Deaf and the Blind and who have

810

received authorization by the Board of Trustees of the Florida

811

School for the Deaf and the Blind to participate in the DROP

812

beyond 60 months, or who are instructional personnel as defined

813

in s. 1012.01(2)(a)-(d) in grades K-12 and who have received

814

authorization by the district school superintendent to

815

participate in the DROP beyond 60 calendar months, 96 calendar

816

months immediately following the date on which the member first

817

reaches his or her normal retirement date or the date to which he

818

or she is eligible to defer his or her election to participate as

819

provided in subparagraph (a)2. However, a member who has reached

820

normal retirement date prior to the effective date of the DROP

821

shall be eligible to participate in the DROP for a period of time

822

not to exceed 60 calendar months or, with respect to members who

823

are instructional personnel employed by the Florida School for

824

the Deaf and the Blind and who have received authorization by the

825

Board of Trustees of the Florida School for the Deaf and the

826

Blind to participate in the DROP beyond 60 months, or who are

827

instructional personnel as defined in s. 1012.01(2)(a)-(d) in

828

grades K-12 and who have received authorization by the district

829

school superintendent to participate in the DROP beyond 60

830

calendar months, 96 calendar months immediately following the

831

effective date of the DROP, except a member of the Special Risk

832

Class who has reached normal retirement date prior to the

833

effective date of the DROP and whose total accrued value exceeds

834

75 percent of average final compensation as of his or her

835

effective date of retirement shall be eligible to participate in

836

the DROP for no more than 36 calendar months immediately

837

following the effective date of the DROP.

838

2. Upon deciding to participate in the DROP, the member

839

shall submit, on forms required by the division:

840

a. A written election to participate in the DROP;

841

b. Selection of the DROP participation and termination

842

dates, which satisfy the limitations stated in paragraph (a) and

843

subparagraph 1. Such termination date shall be in a binding

844

letter of resignation with the employer, establishing a deferred

845

termination date. The member may change the termination date

846

within the limitations of subparagraph 1., but only with the

847

written approval of his or her employer;

848

c. A properly completed DROP application for service

849

retirement as provided in this section; and

850

d. Any other information required by the division.

851

3. The DROP participant shall be a retiree under the

852

Florida Retirement System for all purposes, except for paragraph

853

(5)(f) and subsection (9) and ss. 112.3173, 112.363, 121.053, and

854

121.122. However, participation in the DROP does not alter the

855

participant's employment status and such employee shall not be

856

deemed retired from employment until his or her deferred

857

resignation is effective and termination occurs as provided in s.

858

121.021(39).

859

4. Elected officers shall be eligible to participate in the

860

DROP subject to the following:

861

a. An elected officer who reaches normal retirement date

862

during a term of office may defer the election to participate in

863

the DROP until the next succeeding term in that office. Such

864

elected officer who exercises this option may participate in the

865

DROP for up to 60 calendar months or a period of no longer than

866

such succeeding term of office, whichever is less.

867

b. An elected or a nonelected participant may run for a

868

term of office while participating in DROP and, if elected,

869

extend the DROP termination date accordingly, except, however, if

870

such additional term of office exceeds the 60-month limitation

871

established in subparagraph 1., and the officer does not resign

872

from office within such 60-month limitation, the retirement and

873

the participant's DROP shall be null and void as provided in sub-

874

subparagraph (c)5.d.

875

c.(I) For DROP participation beginning before October 1,

876

2008, an elected officer who is dually employed and elects to

877

participate in DROP shall be required to satisfy the definition

878

of termination within the 60-month or, with respect to members

879

who are instructional personnel employed by the Florida School

880

for the Deaf and the Blind and who have received authorization by

881

the Board of Trustees of the Florida School for the Deaf and the

882

Blind to participate in the DROP beyond 60 months, or who are

883

instructional personnel as defined in s. 1012.01(2)(a)-(d) in

884

grades K-12 and who have received authorization by the district

885

school superintendent to participate in the DROP beyond 60

886

months, the 96-month limitation period as provided in

887

subparagraph 1. for the nonelected position and may continue

888

employment as an elected officer as provided in s. 121.053. The

889

elected officer will be enrolled as a renewed member in the

890

Elected Officers' Class or the Regular Class, as provided in ss.

891

121.053 and 121.122, on the first day of the month after

892

termination of employment in the nonelected position and

893

termination of DROP. Distribution of the DROP benefits shall be

894

made as provided in paragraph (c).

895

(II) For DROP participation beginning on or after October

896

1, 2008, an elected officer who is dually employed and elects to

897

participate in DROP is required to satisfy the definition of

898

termination in s. 121.021(39) within the original 60-month period

899

or, with respect to members who are instructional personnel

900

employed by the Florida School for the Deaf and the Blind and who

901

have received authorization by the Board of Trustees of the

902

Florida School for the Deaf and the Blind to participate in DROP

903

beyond 60 months, or who are instructional personnel as defined

904

in s. 1012.01(2)(a)-(d) in grades K-12 and who have received

905

authorization by the district school superintendent to

906

participate in DROP beyond 60 months, the 96-month limitation

907

period as provided in subparagraph 1.

908

909

1. Effective with the date of DROP participation, the

910

member's initial normal monthly benefit, including creditable

911

service, optional form of payment, and average final

912

compensation, and the effective date of retirement shall be

913

fixed. The beneficiary established under the Florida Retirement

914

System shall be the beneficiary eligible to receive any DROP

915

benefits payable if the DROP participant dies prior to the

916

completion of the period of DROP participation. If In the event a

917

joint annuitant predeceases the member, the member may name a

918

beneficiary to receive accumulated DROP benefits payable. Such

919

retirement benefit, the annual cost of living adjustments

920

provided in s. 121.101, and interest shall accrue monthly in the

921

Florida Retirement System Trust Fund. Such interest shall accrue

922

at an effective annual rate of 6.5 percent compounded monthly, on

923

the prior month's accumulated ending balance, up to the month of

924

termination or death.

925

2. Each employee who elects to participate in the DROP

926

shall be allowed to elect to receive a lump-sum payment for

927

accrued annual leave earned in accordance with agency policy upon

928

beginning participation in the DROP. Such accumulated leave

929

payment certified to the division upon commencement of DROP shall

930

be included in the calculation of the member's average final

931

compensation. The employee electing such lump-sum payment upon

932

beginning participation in DROP will not be eligible to receive a

933

second lump-sum payment upon termination, except to the extent

934

the employee has earned additional annual leave which combined

935

with the original payment does not exceed the maximum lump-sum

936

payment allowed by the employing agency's policy or rules. Such

937

early lump-sum payment shall be based on the hourly wage of the

938

employee at the time he or she begins participation in the DROP.

939

If the member elects to wait and receive such lump-sum payment

940

upon termination of DROP and termination of employment with the

941

employer, any accumulated leave payment made at that time may not

942

cannot be included in the member's retirement benefit, which was

943

determined and fixed by law when the employee elected to

944

participate in the DROP.

945

3. The effective date of DROP participation and the

946

effective date of retirement of a DROP participant shall be the

947

first day of the month selected by the member to begin

948

participation in the DROP, provided such date is properly

949

established, with the written confirmation of the employer, and

950

the approval of the division, on forms required by the division.

951

4. Normal retirement benefits and interest thereon shall

952

continue to accrue in the DROP until the established termination

953

date of the DROP, or until the participant terminates employment

954

or dies prior to such date. Although individual DROP accounts

955

shall not be established, a separate accounting of each

956

participant's accrued benefits under the DROP shall be calculated

957

and provided to participants.

958

5. At the conclusion of the participant's DROP, the

959

division shall distribute the participant's total accumulated

960

DROP benefits, subject to the following provisions:

961

a. The division shall receive verification by the

962

participant's employer or employers that such participant has

963

terminated employment as provided in s. 121.021(39)(b).

964

b. The terminated DROP participant or, if deceased, such

965

participant's named beneficiary, shall elect on forms provided by

966

the division to receive payment of the DROP benefits in

967

accordance with one of the options listed below. For a

968

participant or beneficiary who fails to elect a method of payment

969

within 60 days of termination of the DROP, the division will pay

970

a lump sum as provided in sub-sub-subparagraph (I).

971

(I) Lump sum.--All accrued DROP benefits, plus interest,

972

less withholding taxes remitted to the Internal Revenue Service,

973

shall be paid to the DROP participant or surviving beneficiary.

974

(II) Direct rollover.--All accrued DROP benefits, plus

975

interest, shall be paid from the DROP directly to the custodian

976

of an eligible retirement plan as defined in s. 402(c)(8)(B) of

977

the Internal Revenue Code. However, in the case of an eligible

978

rollover distribution to the surviving spouse of a deceased

979

participant, an eligible retirement plan is an individual

980

retirement account or an individual retirement annuity as

981

described in s. 402(c)(9) of the Internal Revenue Code.

982

(III) Partial lump sum.--A portion of the accrued DROP

983

benefits shall be paid to the DROP participant or surviving

984

spouse, less withholding taxes remitted to the Internal Revenue

985

Service, and the remaining DROP benefits shall be transferred

986

directly to the custodian of an eligible retirement plan as

987

defined in s. 402(c)(8)(B) of the Internal Revenue Code. However,

988

in the case of an eligible rollover distribution to the surviving

989

spouse of a deceased participant, an eligible retirement plan is

990

an individual retirement account or an individual retirement

991

annuity as described in s. 402(c)(9) of the Internal Revenue

992

Code. The proportions shall be specified by the DROP participant

993

or surviving beneficiary.

994

c. The form of payment selected by the DROP participant or

995

surviving beneficiary complies with the minimum distribution

996

requirements of the Internal Revenue Code.

997

d. A DROP participant who fails to terminate employment as

998

defined in s. 121.021(39)(b) shall be deemed not to be retired,

999

and the DROP election shall be null and void. Florida Retirement

1000

System membership shall be reestablished retroactively to the

1001

date of the commencement of the DROP, and each employer with whom

1002

the participant continues employment must shall be required to

1003

pay to the Florida Retirement System Trust Fund the difference

1004

between the DROP contributions paid in paragraph (i) and the

1005

contributions required for the applicable Florida Retirement

1006

System class of membership during the period the member

1007

participated in the DROP, plus 6.5 percent interest compounded

1008

annually.

1009

6. The accrued benefits of any DROP participant, and any

1010

contributions accumulated under such program, shall not be

1011

subject to assignment, execution, attachment, or to any legal

1012

process whatsoever, except for qualified domestic relations

1013

orders by a court of competent jurisdiction, income deduction

1014

orders as provided in s. 61.1301, and federal income tax levies.

1015

7. DROP participants shall not be eligible for disability

1016

retirement benefits as provided in subsection (4).

1017

(d) Death benefits under the DROP.--

1018

1. Upon the death of a DROP participant, the named

1019

beneficiary shall be entitled to apply for and receive the

1020

accrued benefits in the DROP as provided in sub-subparagraph

1021

1022

2. The normal retirement benefit accrued to the DROP during

1023

the month of a participant's death shall be the final monthly

1024

benefit credited for such DROP participant.

1025

3. Eligibility to participate in the DROP terminates upon

1026

death of the participant. If the participant dies on or after the

1027

effective date of enrollment in the DROP, but prior to the first

1028

monthly benefit being credited to the DROP, Florida Retirement

1029

System benefits shall be paid in accordance with subparagraph

1030

(7)(c)1. or subparagraph 2.

1031

4. A DROP participants' survivors shall not be eligible to

1032

receive Florida Retirement System death benefits as provided in

1033

paragraph (7)(d).

1034

(e) Cost-of-living adjustment.--On each July 1, the

1035

participants' normal retirement benefit shall be increased as

1036

provided in s. 121.101.

1037

(f) Retiree health insurance subsidy.--DROP participants

1038

are not eligible to apply for the retiree health insurance

1039

subsidy payments as provided in s. 112.363 until such

1040

participants have terminated employment and participation in the

1041

DROP.

1042

(g) Renewed membership.--DROP participants must meet the

1043

definition of termination in s. 121.021(39)(b) and the

1044

eligibility requirements shall not be eligible for renewed

1045

membership in the Florida Retirement System under ss. 121.053 and

1046

121.122 until termination of employment is effectuated as

1047

provided in s. 121.021(39)(b).

1048

(h) Employment limitation after DROP participation.--Upon

1049

satisfying the definition of termination of employment as

1050

provided in s. 121.021(39)(b), DROP participants shall be subject

1051

to such reemployment limitations as other retirees. Reemployment

1052

restrictions applicable to retirees as provided in subsection (9)

1053

shall not apply to DROP participants until their employment and

1054

participation in the DROP are terminated.

1055

(i) Contributions.--

1056

1. All employers paying the salary of a DROP participant

1057

filling a regularly established position shall contribute 8.0

1058

percent of such participant's gross compensation for the period

1059

of July 1, 2002, through June 30, 2003, and 11.56 percent of such

1060

compensation thereafter, which shall constitute the entire

1061

employer DROP contribution with respect to such participant. Such

1062

contributions, payable to the System Trust Fund in the same

1063

manner as required in s. 121.071, shall be made as appropriate

1064

for each pay period and are in addition to contributions required

1065

for social security and the Retiree Health Insurance Subsidy

1066

Trust Fund. Such employer, social security, and health insurance

1067

subsidy contributions are not included in the DROP.

1068

2. The employer shall, in addition to subparagraph 1., also

1069

withhold one-half of the entire social security contribution

1070

required for the participant. Contributions for social security

1071

by each participant and each employer, in the amount required for

1072

social security coverage as now or hereafter provided by the

1073

federal Social Security Act, shall be in addition to

1074

contributions specified in subparagraph 1.

1075

3. All employers paying the salary of a DROP participant

1076

filling a regularly established position shall contribute the

1077

percent of such participant's gross compensation required in s.

1078

121.071(4), which shall constitute the employer's health

1079

insurance subsidy contribution with respect to such participant.

1080

Such contributions shall be deposited by the administrator in the

1081

Retiree Health Insurance Subsidy Trust Fund.

1082

(j) Forfeiture of retirement benefits.--Nothing in this

1083

section shall be construed to remove DROP participants from the

1084

scope of s. 8(d), Art. II of the State Constitution, s. 112.3173,

1085

and paragraph (5)(f). DROP participants who commit a specified

1086

felony offense while employed will be subject to forfeiture of

1087

all retirement benefits, including DROP benefits, pursuant to

1088

those provisions of law.

1089

(k) Administration of program.--The division shall make

1090

such rules as are necessary for the effective and efficient

1091

administration of this subsection. The division shall not be

1092

required to advise members of the federal tax consequences of an

1093

election related to the DROP but may advise members to seek

1094

independent advice.

1095

Section 8. Section 121.122, Florida Statutes, is amended to

1096

read:

1097

121.122 Renewed membership in system.--

1098

(1) The retiree of a state-administered retirement system

1099

who is initially reemployed on or after October 1, 2008, is not

1100

eligible for renewed membership.

1101

(2) Except as provided in s. 121.053, effective July 1,

1102

1991, through September 30, 2008, any retiree of a state-

1103

administered retirement system who is initially reemployed

1104

employed in a regularly established position with a covered

1105

employer shall be enrolled as a compulsory member of the Regular

1106

Class of the Florida Retirement System or, effective July 1,

1107

1997, through September 30, 2008, any retiree of a state-

1108

administered retirement system who is initially reemployed

1109

employed in a position included in the Senior Management Service

1110

Class shall be enrolled as a compulsory member of the Senior

1111

Management Service Class of the Florida Retirement System as

1112

provided in s. 121.055, and shall be entitled to receive an

1113

additional retirement benefit, subject to the following

1114

conditions:

1115

(1)(a) Such member shall resatisfy the age and service

1116

requirements as provided in this chapter for initial membership

1117

under the system, unless such member elects to participate in the

1118

Senior Management Service Optional Annuity Program in lieu of the

1119

Senior Management Service Class, as provided in s. 121.055(6).

1120

(b) Such member shall not be entitled to disability

1121

benefits as provided in s. 121.091(4).

1122

1123

limitations as provided in s. 121.091(9), as applicable.

1124

(3)(2) Upon renewed membership or employment of a retiree,

1125

the employer of such member shall pay the applicable employer

1126

contributions as required by ss. 121.055(3) and 121.071(1)(a) and

1127

(4).

1128

(4)(3) The retiree of a state-administered retirement

1129

system who is initially reemployed before October 1, 2008, Such

1130

member shall be entitled to purchase additional retirement credit

1131

in the Regular Class or the Senior Management Service Class, as

1132

applicable, for any postretirement service performed in a

1133

regularly established position as follows:

1134

(a) For regular class service prior to July 1, 1991, by

1135

paying the Regular Class applicable employee and employer

1136

contributions for the period being claimed, plus 4 percent

1137

interest compounded annually from first year of service claimed

1138

until July 1, 1975, and 6.5 percent interest compounded

1139

thereafter, until full payment is made to the Florida Retirement

1140

System Trust Fund; or

1141

(b) For Senior Management Service Class prior to June 1,

1142

1997, as provided in s. 121.055(1)(j).

1143

1144

The contribution for postretirement service between July 1, 1985,

1145

and July 1, 1991, for which the reemployed retiree contribution

1146

was paid, shall be the difference between such contribution and

1147

the total applicable contribution for the period being claimed,

1148

plus interest. The employer of such member may pay the applicable

1149

employer contribution in lieu of the member. If a member does not

1150

wish to claim credit for all of the postretirement service for

1151

which he or she is eligible, the service the member claims must

1152

be the most recent service.

1153

(5)(4) No creditable service for which credit was received,

1154

or which remained unclaimed, at retirement may be claimed or

1155

applied toward service credit earned following renewed

1156

membership. However, for retirees initially reemployed before

1157

October 1, 2008, service earned as an elected officer with

1158

renewed membership in the Elected Officers' Class may be used in

1159

conjunction with creditable service earned under this section,

1160

provided the applicable vesting requirements and other existing

1161

statutory conditions required by this chapter are met.

1162

(6)(5) Notwithstanding any other limitations provided in

1163

this section, a participant of the State University System

1164

Optional Retirement Program or the Senior Management Service

1165

Optional Annuity Program who terminated employment and received a

1166

distribution commenced receiving an annuity under the provisions

1167

of the optional program, who initially renews membership in the

1168

Regular Class before October 1, 2008, as required by this section

1169

upon reemployment after retirement, and who had previously earned

1170

creditable Florida Retirement System service that was not

1171

included in any retirement benefit may include such previous

1172

service toward vesting and service credit in the second career

1173

benefit provided under renewed membership.

1174

(7)(6) Any renewed member who is not receiving the maximum

1175

health insurance subsidy provided in s. 112.363 shall be entitled

1176

to earn additional credit toward the maximum health insurance

1177

subsidy. Any additional subsidy due because of such additional

1178

credit shall be received only at the time of payment of the

1179

second career retirement benefit. In no case shall the total

1180

health insurance subsidy received by a retiree receiving benefits

1181

from initial and renewed membership exceed the maximum allowed in

1182

s. 112.363.

1183

Section 9. Paragraph (a) of subsection (2) and paragraph

1184

(e) of subsection (5) of section 121.35, Florida Statutes, are

1185

amended to read:

1186

121.35 Optional retirement program for the State University

1187

System.--

1188

(2) ELIGIBILITY FOR PARTICIPATION IN OPTIONAL PROGRAM.--

1189

(a) Participation in the optional retirement program

1190

provided by this section shall be limited to persons who are

1191

otherwise eligible for membership or renewed membership in the

1192

Florida Retirement System before October 1, 2008, and who are

1193

employed in one of the following State University System

1194

positions:

1195

1. Positions classified as instructional and research

1196

faculty which are exempt from the career service under the

1197

provisions of s. 110.205(2)(d).

1198

2. Positions classified as administrative and professional

1199

which are exempt from the career service under the provisions of

1200

s. 110.205(2)(d).

1201

3. The Chancellor and the university presidents.

1202

(5) BENEFITS.--

1203

(e) A participant who chooses to receive his or her

1204

benefits upon termination of employment as defined in s.

1205

121.021(39) shall have responsibility to notify the provider

1206

company of the date on which he or she wishes benefits funded by

1207

employer contributions to begin. Benefits may be deferred until

1208

such time as the participant chooses to make such application.

1209

Section 10. Paragraph (f) of subsection (2) of section

1210

121.4501, Florida Statutes, is amended to read:

1211

121.4501 Public Employee Optional Retirement Program.--

1212

(2) DEFINITIONS.--As used in this part, the term:

1213

(f) "Eligible employee" means an officer or employee, as

1214

defined in s. 121.021(11), who:

1215

1. Is a member of, or is eligible for membership in, the

1216

Florida Retirement System, including any renewed member of the

1217

Florida Retirement System initially enrolled before October 1,

1218

2008; or

1219

2. Participates in, or is eligible to participate in, the

1220

Senior Management Service Optional Annuity Program as established

1221

under s. 121.055(6), the State Community College Optional

1222

Retirement Program as established under s. 121.051(2)(c), or the

1223

State University System Optional Retirement Program established

1224

under s. 121.35.

1225

1226

The term does not include any member participating in the

1227

Deferred Retirement Option Program established under s.

1228

121.091(13), a retiree of a state-administered retirement system

1229

initially employed on or after October 1, 2008, or a mandatory

1230

participant of the State University System Optional Retirement

1231

Program established under s. 121.35.

1232

Section 11. Paragraph (b) of subsection (1) of section

1233

121.591, Florida Statutes, is amended to read:

1234

121.591 Benefits payable under the Public Employee Optional

1235

Retirement Program of the Florida Retirement System.--Benefits

1236

may not be paid under this section unless the member has

1237

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

1238

deceased and a proper application has been filed in the manner

1239

prescribed by the state board or the department. The state board

1240

or department, as appropriate, may cancel an application for

1241

retirement benefits when the member or beneficiary fails to

1242

timely provide the information and documents required by this

1243

chapter and the rules of the state board and department. In

1244

accordance with their respective responsibilities as provided

1245

herein, the State Board of Administration and the Department of

1246

Management Services shall adopt rules establishing procedures for

1247

application for retirement benefits and for the cancellation of

1248

such application when the required information or documents are

1249

not received. The State Board of Administration and the

1250

Department of Management Services, as appropriate, are authorized

1251

to cash out a de minimis account of a participant who has been

1252

terminated from Florida Retirement System covered employment for

1253

a minimum of 6 calendar months. A de minimis account is an

1254

account containing employer contributions and accumulated

1255

earnings of not more than $5,000 made under the provisions of

1256

this chapter. Such cash-out must either be a complete lump-sum

1257

liquidation of the account balance, subject to the provisions of

1258

the Internal Revenue Code, or a lump-sum direct rollover

1259

distribution paid directly to the custodian of an eligible

1260

retirement plan, as defined by the Internal Revenue Code, on

1261

behalf of the participant. If any financial instrument issued for

1262

the payment of retirement benefits under this section is not

1263

presented for payment within 180 days after the last day of the

1264

month in which it was originally issued, the third-party

1265

administrator or other duly authorized agent of the State Board

1266

of Administration shall cancel the instrument and credit the

1267

amount of the instrument to the suspense account of the Public

1268

Employee Optional Retirement Program Trust Fund authorized under

1269

s. 121.4501(6). Any such amounts transferred to the suspense

1270

account are payable upon a proper application, not to include

1271

earnings thereon, as provided in this section, within 10 years

1272

after the last day of the month in which the instrument was

1273

originally issued, after which time such amounts and any earnings

1274

thereon shall be forfeited. Any such forfeited amounts are assets

1275

of the Public Employee Optional Retirement Program Trust Fund and

1276

are not subject to the provisions of chapter 717.

1277

(1) NORMAL BENEFITS.--Under the Public Employee Optional

1278

Retirement Program:

1279

(b) If a participant elects to receive his or her benefits

1280

upon termination of employment as defined in s. 121.021(39), the

1281

participant must submit a written application or an equivalent

1282

form to the third-party administrator indicating his or her

1283

preferred distribution date and selecting an authorized method of

1284

distribution as provided in paragraph (c). The participant may

1285

defer receipt of benefits until he or she chooses to make such

1286

application, subject to federal requirements.

1287

Section 12. This act shall take effect July 1, 2008.