Florida Senate - 2009 COMMITTEE AMENDMENT Bill No. SB 538 Barcode 289978 LEGISLATIVE ACTION Senate . House Comm: FAV . 03/10/2009 . . . . ————————————————————————————————————————————————————————————————— ————————————————————————————————————————————————————————————————— The Committee on Community Affairs (Deutch) recommended the following: 1 Senate Amendment (with title amendment) 2 3 Delete lines 200 - 279 4 and insert: 5 Section 3. Subsection (7) is added to section 175.071, 6 Florida Statutes, and subsection (1) of that section, is amended 7 to read: 8 175.071 General powers and duties of board of trustees.—For 9 any municipality, special fire control district, chapter plan, 10 local law municipality, local law special fire control district, 11 or local law plan under this chapter: 12 (1) The board of trustees, subject to the fiduciary 13 standards in ss. 112.656, 112.661, and 518.11 and the Code of 14 Ethics in ss. 112.311-112.3187, may: 15 (a) Invest and reinvest the assets of the firefighters’ 16 pension trust fund in annuity and life insurance contracts of 17 life insurance companies in amounts sufficient to provide, in 18 whole or in part, the benefits to which all of the participants 19 in the firefighters’ pension trust fund shall be entitled under 20 the provisions of this chapter and pay the initial and 21 subsequent premiums thereon. 22 (b) Invest and reinvest the assets of the firefighters’ 23 pension trust fund in: 24 1. Time or savings accounts of a national bank, a state 25 bank insured by the Bank Insurance Fund, or a savings, building, 26 and loan association insured by the Savings Association 27 Insurance Fund which is administered by the Federal Deposit 28 Insurance Corporation or a state or federal chartered credit 29 union whose share accounts are insured by the National Credit 30 Union Share Insurance Fund. 31 2. Obligations of the United States or obligations 32 guaranteed as to principal and interest by the government of the 33 United States. 34 3. Bonds issued by the State of Israel. 35 4. Bonds, stocks, or other evidences of indebtedness issued 36 or guaranteed by a corporation organized under the laws of the 37 United States, any state or organized territory of the United 38 States, or the District of Columbia, provided: 39 a. The corporation is listed on any one or more of the 40 recognized national stock exchanges or on the National Market 41 System of the NASDAQ Stock Market and, in the case of bonds 42 only, holds a rating in one of the three highest classifications 43 by a major rating service; and 44 b. The board of trustees shall not invest more than 5 45 percent of its assets in the common stock or capital stock of 46 any one issuing company, nor shall the aggregate investment in 47 any one issuing company exceed 5 percent of the outstanding 48 capital stock of that company or the aggregate of its 49 investments under this subparagraph at cost exceed 50 percent of 50 the assets of the fund. 51 52 This paragraph shall apply to all boards of trustees and 53 participants. However, in the event that a municipality or 54 special fire control district has a duly enacted pension plan 55 pursuant to, and in compliance with, s. 175.351, and the 56 trustees thereof desire to vary the investment procedures 57 herein, the trustees of such plan shall request a variance of 58 the investment procedures as outlined herein only through a 59 municipal ordinance, special act of the Legislature, or 60 resolution by the governing body of the special fire control 61 district; where a special act, or a municipality by ordinance 62 adopted prior to July 1, 1998, permits a greater than 50-percent 63 equity investment, such municipality shall not be required to 64 comply with the aggregate equity investment provisions of this 65 paragraph. Notwithstanding any other provision of law to the 66 contrary, nothing in this section may be construed to take away 67 any preexisting legal authority to make equity investments that 68 exceed the requirements of this paragraph. Notwithstanding any 69 law to the contrary, the board of trustees may invest up to 25 7010percent of plan assets in foreign securities on a market 71 value basis. The investment cap on foreign securities may not be 72 revised, amended, increased, or repealed except as provided by 73 general law. 74 (c) Issue drafts upon the firefighters’ pension trust fund 75 pursuant to this act and rules and regulations prescribed by the 76 board of trustees. All such drafts shall be consecutively 77 numbered, be signed by the chair and secretary or by two 78 individuals designated by the board who are subject to the same 79 fiduciary standards as required for the board of trustees under 80 this subsection, and state upon their faces the purpose for 81 which the drafts are drawn. The treasurer or depository of each 82 municipality or special fire control district shall retain such 83 drafts when paid, as permanent vouchers for disbursements made, 84 and no money shall be otherwise drawn from the fund. 85 (d) Convert into cash any securities of the fund. 86 (e) Keep a complete record of all receipts and disbursements and 87 of the board’s acts and proceedings. 88 (7) Notwithstanding the provisions of paragraph (1)(b) and 89 as provided in s. 215.473, the board of trustees must identify 90 and publicly report any direct or indirect holdings it may have 91 in any scrutinized company, as defined in that section, and 92 proceed to sell, redeem, divest, or withdraw all publicly traded 93 securities it may have in such company beginning January 1, 94 2010. The divestiture of any such security must be completed by 95 March 1, 2010. The board and its named officers or investment 96 advisors may not be deemed to have breached their fiduciary duty 97 in any action taken to dispose of any such security, and the 98 board shall have satisfactorily discharged the fiduciary duties 99 of loyalty, prudence, and sole and exclusive benefit to the 100 participants of the pension fund and their beneficiaries if the 101 actions it takes are consistent with the duties imposed by s. 102 215.473, and the manner of the disposition, if any, is 103 reasonable as to the means chosen. For the purposes of effecting 104 compliance with that section, the pension fund shall designate 105 terror-free plans that allocate their funds among securities not 106 subject to divestiture. No person may bring any civil, criminal, 107 or administrative action against the board of trustees or any 108 employee, officer, director, or advisor of such pension fund 109 based upon the divestiture of any security pursuant to this 110 paragraph. 111 112 ================= T I T L E A M E N D M E N T ================ 113 And the title is amended as follows: 114 Delete lines 22 - 23 115 and insert: 116 providing that investment caps on foreign securities may only be 117 amended, repealed, or increased by an act of the Legislature; 118 authorizing certain individuals to sign drafts issued upon the 119 firefighters’ pension trust fund; requiring the board of 120 trustees to identify and divest of any scrutinized companies by 121 a certain date; amending