HB 413

1	A bill to be entitled
2	An act relating to the defined contribution retirement
3	program; amending s. 112.0801, F.S.; revising the
4	definition of the term "retiree" for purposes of
5	participation in group insurance by retired employees;
6	amending ss. 110.123, 112.363, 112.65, 121.021, 121.051,
7	121.35, 121.71, 121.72, 121.73, 121.74, 121.77, and
8	121.78, F.S.; conforming cross-references; substituting
9	references to the defined contribution program for
10	references to the Public Employee Optional Retirement
11	Program; amending ss. 121.091, 121.4503, 121.571, 121.591,
12	and 121.5911, F.S.; conforming cross-references; changing
13	the name of the Public Employee Optional Retirement
14	Program to the Public Employee Retirement Investment
15	Program; changing the name of the Public Employee Optional
16	Retirement Program Trust Fund to the Public Employee
17	Retirement Investment Program Trust Fund; amending s.
18	121.055, F.S.; deleting obsolete provisions; amending s.
19	121.4501, F.S.; changing the name of the Public Employee
20	Optional Retirement Program to the Public Employee
21	Retirement Investment Program; limiting the option of
22	enrolling in the Florida Retirement System's defined
23	benefit program or defined contribution program to public
24	employees employed before January 1, 2011; requiring
25	public employees employed on or after January 1, 2011, to
26	enroll in the defined contribution program; revising
27	definitions; deleting obsolete provisions relating to the
28	2002 optional transfer of public employees from the
29	defined benefit program to the defined contribution
30	program; deleting requirements for an educational program
31	that compares retirement programs; amending s. 121.4502,
32	F.S.; changing the name of the Public Employee Optional
33	Retirement Program Trust Fund to the Public Employee
34	Retirement Investment Program Trust Fund; amending s.
35	121.70, F.S.; revising legislative intent; changing the
36	name of the Public Employee Optional Retirement Program to
37	the defined contribution program; deleting provisions
38	relating to an employee's choice in retirement plans;
39	providing a directive to the Division of Statutory
40	Revision; providing an effective date.
41
42	Be It Enacted by the Legislature of the State of Florida:
43
44	Section 1.  Paragraph (g) of subsection (2) of section
45	110.123, Florida Statutes, is amended to read:
46	110.123  State group insurance program.-
47	(2)  DEFINITIONS.-As used in this section, the term:
48	(g)  "Retired state officer or employee" or "retiree" means
49	any state or state university officer or employee who retires
50	under a state retirement system or a state optional annuity or
51	retirement program or is placed on disability retirement, and
52	who was insured under the state group insurance program at the
53	time of retirement, and who begins receiving retirement benefits
54	immediately after retirement from state or state university
55	office or employment. In addition to these requirements, the
56	term includes any state officer or state employee who retires
57	under the defined contribution Public Employee Optional
58	Retirement program established under part II of chapter 121
59	shall be considered a "retired state officer or employee" or
60	"retiree" as used in this section if he or she:
61	1.  Meets the age and service requirements to qualify for
62	normal retirement as set forth in s. 121.021(29); or
63	2.  Has attained the age specified by s. 72(t)(2)(A)(i) of
64	the Internal Revenue Code and has 6 years of creditable service.
65	Section 2.  Section 112.0801, Florida Statutes, is amended
66	to read:
67	112.0801  Group insurance; participation by retired
68	employees.-
69	(1)  Any state agency, county, municipality, special
70	district, community college, or district school board that which
71	provides life, health, accident, hospitalization, or annuity
72	insurance, or all of any kinds of such insurance, for its
73	officers and employees and their dependents upon a group
74	insurance plan or self-insurance plan shall allow all former
75	personnel who have retired before prior to October 1, 1987, as
76	well as those who retire on or after such date, and their
77	eligible dependents, the option of continuing to participate in
78	the such group insurance plan or self-insurance plan. Retirees
79	and their eligible dependents shall be offered the same health
80	and hospitalization insurance coverage as is offered to active
81	employees at a premium cost of no more than the premium cost
82	applicable to active employees. For the retired employees and
83	their eligible dependents, the cost of any such continued
84	participation in any type of plan or any of the cost thereof may
85	be paid by the employer or by the retired employees. To
86	determine health and hospitalization plan costs, the employer
87	shall commingle the claims experience of the retiree group with
88	the claims experience of the active employees; and, for other
89	types of coverage, the employer may commingle the claims
90	experience of the retiree group with the claims experience of
91	active employees. Retirees covered under Medicare may be
92	experience-rated separately from the retirees not covered by
93	Medicare and from active employees if, provided that the total
94	premium does not exceed that of the active group and coverage is
95	basically the same as for the active group.
96	(2)  For purposes of this section, "retiree" has the same
97	meaning as in s. 110.123(2). means any officer or employee who
98	retires under a state retirement system or a state optional
99	annuity or retirement program or is placed on disability
100	retirement and who begins receiving retirement benefits
101	immediately after retirement from employment. In addition to
102	these requirements, any officer or employee who retires under
103	the Public Employee Optional Retirement Program established
104	under part II of chapter 121 shall be considered a "retired
105	officer or employee" or "retiree" as used in this section if he
106	or she:
107	(a)  Meets the age and service requirements to qualify for
108	normal retirement as set forth in s. 121.021(29); or
109	(b)  Has attained the age specified by s. 72(t)(2)(A)(i) of
110	the Internal Revenue Code and has 6 years of creditable service.
111	Section 3.  Paragraph (b) of subsection (2) and paragraph
112	(e) of subsection (3) of section 112.363, Florida Statutes, are
113	amended to read:
114	112.363  Retiree health insurance subsidy.-
115	(2)  ELIGIBILITY FOR RETIREE HEALTH INSURANCE SUBSIDY.-
116	(b)  For purposes of this section, a person is deemed
117	retired from a state-administered retirement system if when he
118	or she terminates employment with all employers participating in
119	the Florida Retirement System as described in s. 121.021(39)
120	and:
121	1.  For a participant of the defined contribution Public
122	Employee Optional Retirement program established under part II
123	of chapter 121, the participant meets the age or service
124	requirements to qualify for normal retirement as set forth in s.
125	121.021(29).
126	2.  For a member of the Florida Retirement System defined
127	benefit program, or any employee who maintains creditable
128	service under both the defined benefit program and the defined
129	contribution Public Employee Optional Retirement program, the
130	member begins drawing retirement benefits from the defined
131	benefit program of the Florida Retirement System.
132	(3)  RETIREE HEALTH INSURANCE SUBSIDY AMOUNT.-
133	(e)1.  Beginning July 1, 2001, each eligible retiree of the
134	defined benefit program of the Florida Retirement System, or, if
135	the retiree is deceased, his or her beneficiary who is receiving
136	a monthly benefit from such retiree's account and who is a
137	spouse, or a person who meets the definition of joint annuitant
138	in s. 121.021(28), shall receive a monthly retiree health
139	insurance subsidy payment equal to the number of years of
140	creditable service, as defined in s. 121.021(17), completed at
141	the time of retirement multiplied by $5; however, no eligible
142	retiree or beneficiary may receive a subsidy payment of more
143	than $150 or less than $30. If there are multiple beneficiaries,
144	the total payment may must not be greater than the payment to
145	which the retiree was entitled. The health insurance subsidy
146	amount payable to any person receiving the retiree health
147	insurance subsidy payment on July 1, 2001, may shall not be
148	reduced solely by operation of this subparagraph.
149	2.  Beginning July 1, 2002, each eligible participant of
150	the defined contribution Public Employee Optional Retirement
151	program of the Florida Retirement System who has met the
152	requirements of this section, or, if the participant is
153	deceased, his or her spouse who is the participant's designated
154	beneficiary, shall receive a monthly retiree health insurance
155	subsidy payment equal to the number of years of creditable
156	service, as provided in this subparagraph, completed at the time
157	of retirement, multiplied by $5; however, no eligible retiree or
158	beneficiary may receive a subsidy payment of more than $150 or
159	less than $30. For purposes of determining a participant's
160	creditable service used to calculate the health insurance
161	subsidy, a participant's years of service credit or fraction
162	thereof shall be based on the participant's work year as defined
163	in s. 121.021(54). Credit must shall be awarded for a full work
164	year whenever health insurance subsidy contributions have been
165	made as required by law for each month in the participant's work
166	year. In addition, all years of creditable service retained
167	under the Florida Retirement System defined benefit program must
168	shall be included as creditable service for purposes of this
169	section. Notwithstanding any other provision in this section to
170	the contrary, the spouse at the time of death is shall be the
171	participant's beneficiary unless such participant has designated
172	a different beneficiary subsequent to the participant's most
173	recent marriage.
174	Section 4.  Subsection (1) of section 112.65, Florida
175	Statutes, is amended to read:
176	112.65  Limitation of benefits.-
177	(1)  ESTABLISHMENT OF PROGRAM.-The normal retirement
178	benefit or pension payable to a retiree who becomes a member of
179	any retirement system or plan and who has not previously
180	participated in such plan, on or after January 1, 1980, may
181	shall not exceed 100 percent of his or her average final
182	compensation. However, nothing contained in this section does
183	not shall apply to supplemental retirement benefits or to
184	pension increases attributable to cost-of-living increases or
185	adjustments. For the purposes of this section, benefits accruing
186	in individual participant accounts established under the defined
187	contribution Public Employee Optional Retirement program
188	established in part II of chapter 121 are considered
189	supplemental benefits. As used in this section, the term
190	"average final compensation" means the average of the member's
191	earnings over a period of time which the governmental entity has
192	established by statute, charter, or ordinance.
193	Section 5.  Subsection (3) and paragraph (b) of subsection
194	(22) of section 121.021, Florida Statutes, are amended to read:
195	121.021  Definitions.-The following words and phrases as
196	used in this chapter have the respective meanings set forth
197	unless a different meaning is plainly required by the context:
198	(3)  "System" means the general retirement system
199	established by this chapter to be known and cited as the
200	"Florida Retirement System," including, but not limited to, the
201	defined benefit retirement program administered under the
202	provisions of part I of this part chapter and the defined
203	contribution retirement program known as the Public Employee
204	Optional Retirement Program and administered under the
205	provisions of part II of this chapter.
206	(22)  "Compensation" means the monthly salary paid a member
207	by his or her employer for work performed arising from that
208	employment.
209	(b)  Under no circumstances shall Compensation for a member
210	participating in the defined benefit retirement program or the
211	Public Employee Optional Retirement Investment Program of the
212	Florida Retirement System may not include:
213	1.  Fees paid professional persons for special or
214	particular services or include salary payments made from a
215	faculty practice plan authorized by the Board of Governors of
216	the State University System for eligible clinical faculty at a
217	college in a state university that has a faculty practice plan;
218	or
219	2.  Any bonuses, as defined in subsection (47), or other
220	payments prohibited from inclusion in the member's average final
221	compensation and defined in subsection (47).
222	Section 6.  Paragraph (c) of subsection (2) of section
223	121.051, Florida Statutes, is amended to read:
224	121.051  Participation in the system.-
225	(2)  OPTIONAL PARTICIPATION.-
226	(c)  Employees of public community colleges or charter
227	technical career centers sponsored by public community colleges,
228	designated in s. 1000.21(3), who are members of the Regular
229	Class of the Florida Retirement System and who comply with the
230	criteria set forth in this paragraph and s. 1012.875 may, in
231	lieu of participating in the Florida Retirement System, elect to
232	withdraw from the system altogether and participate in the State
233	Community College System Optional Retirement Program provided by
234	the employing agency under s. 1012.875.
235	1.  Through June 30, 2001, the cost to the employer for an
236	such annuity under the optional retirement program shall equal
237	equals the normal cost portion of the employer retirement
238	contribution which would be required if the employee were a
239	member of the Regular Class defined benefit program, plus the
240	portion of the contribution rate required by s. 112.363(8) which
241	would otherwise be assigned to the Retiree Health Insurance
242	Subsidy Trust Fund. Effective July 1, 2001, each employer shall
243	contribute on behalf of each participant in the optional program
244	an amount equal to 10.43 percent of the participant's gross
245	monthly compensation. The employer shall deduct an amount for
246	the administration of the program. The employer shall contribute
247	an additional amount to the Florida Retirement System Trust Fund
248	equal to the unfunded actuarial accrued liability portion of the
249	Regular Class contribution rate.
250	2.  The decision to participate in the an optional
251	retirement program is irrevocable as long as the employee holds
252	a position eligible for participation, except as provided in
253	subparagraph 3. Any service creditable under the Florida
254	Retirement System is retained after the member withdraws from
255	the system; however, additional service credit in the system may
256	not be earned while a member of the optional retirement program.
257	3.  An employee who has elected to participate in the
258	optional retirement program shall have one opportunity, at the
259	employee's discretion, to transfer from the optional retirement
260	program to the defined benefit program of the Florida Retirement
261	System or to the defined contribution Public Employee Optional
262	Retirement program established under part II of this chapter,
263	subject to the terms of the applicable optional retirement
264	program contracts.
265	a.  If the employee chooses to move to the defined
266	contribution Public Employee Optional Retirement program, any
267	contributions, interest, and earnings creditable to the employee
268	under the State Community College System Optional Retirement
269	Program are retained by the employee in the State Community
270	College System Optional Retirement Program, and the applicable
271	provisions of s. 121.4501(4) govern the election.
272	b.  If the employee chooses to move to the defined benefit
273	program of the Florida Retirement System, the employee shall
274	receive service credit equal to his or her years of service
275	under the State Community College System Optional Retirement
276	Program.
277	(I)  The cost for such credit must be an is the amount
278	representing the present value of the employee's accumulated
279	benefit obligation for the affected period of service. The cost
280	shall be calculated as if the benefit commencement occurs on the
281	first date the employee becomes eligible for unreduced benefits,
282	using the discount rate and other relevant actuarial assumptions
283	that were used to value the Florida Retirement System defined
284	benefit program plan liabilities in the most recent actuarial
285	valuation. The calculation must include any service already
286	maintained under the defined benefit program plan in addition to
287	the years under the State Community College System Optional
288	Retirement Program. The present value of any service already
289	maintained under the defined benefit program shall must be
290	applied as a credit to total cost resulting from the
291	calculation. The division shall ensure that the transfer sum is
292	prepared using a formula and methodology certified by an
293	enrolled actuary.
294	(II)  The employee must transfer from his or her State
295	Community College System Optional Retirement Program account and
296	from other employee moneys as necessary, a sum representing the
297	present value of the employee's accumulated benefit obligation
298	immediately following the time of such movement, determined
299	assuming that attained service equals the sum of service in the
300	defined benefit program and service in the State Community
301	College System Optional Retirement Program.
302	4.  Participation in the optional retirement program is
303	limited to employees who satisfy the following eligibility
304	criteria:
305	a.  The employee is must be otherwise eligible for
306	membership or renewed membership in the Regular Class of the
307	Florida Retirement System, as provided in s. 121.021(11) and
308	(12) or s. 121.122.
309	b.  The employee is must be employed in a full-time
310	position classified in the Accounting Manual for Florida's
311	Public Community Colleges as:
312	(I)  Instructional; or
313	(II)  Executive Management, Instructional Management, or
314	Institutional Management, if a community college determines that
315	recruiting to fill a vacancy in the position is to be conducted
316	in the national or regional market, and the duties and
317	responsibilities of the position include the formulation,
318	interpretation, or implementation of policies, or the
319	performance of functions that are unique or specialized within
320	higher education and that frequently support the mission of the
321	community college.
322	c.  The employee is must be employed in a position not
323	included in the Senior Management Service Class of the Florida
324	Retirement System, as described in s. 121.055.
325	5.  Participants in the program are subject to the same
326	reemployment limitations, renewed membership provisions, and
327	forfeiture provisions as are applicable to regular members of
328	the Florida Retirement System under ss. 121.091(9), 121.122, and
329	121.091(5), respectively. A participant who receives a program
330	distribution funded by employer contributions shall be deemed to
331	be retired from a state-administered retirement system if the
332	participant is subsequently employed with an employer that
333	participates in the Florida Retirement System.
334	6.  Eligible community college employees are compulsory
335	members of the Florida Retirement System until, pursuant to s.
336	1012.875, a written election to withdraw from the system and
337	participate in the State Community College System Optional
338	Retirement Program is filed with the program administrator and
339	received by the division.
340	a.  A community college employee whose program eligibility
341	results from initial employment must be enrolled in the State
342	Community College System Optional Retirement Program retroactive
343	to the first day of eligible employment. The employer retirement
344	contributions paid through the month of the employee plan change
345	must shall be transferred to the community college to the
346	employee's optional program account, and, effective the first
347	day of the next month, the employer shall pay the applicable
348	contributions based upon subparagraph 1.
349	b.  A community college employee whose program eligibility
350	is due to the subsequent designation of the employee's position
351	as one of those specified in subparagraph 4., or due to the
352	employee's appointment, promotion, transfer, or reclassification
353	to a position specified in subparagraph 4., must be enrolled in
354	the program on the first day of the first full calendar month
355	that such change in status becomes effective. The employer
356	retirement contributions paid from the effective date through
357	the month of the employee plan change must be transferred to the
358	community college to the employee's optional program account,
359	and, effective the first day of the next month, the employer
360	shall pay the applicable contributions based upon subparagraph
361	1.
362	7.  Effective July 1, 2003, through December 31, 2008, any
363	participant of the State Community College System Optional
364	Retirement Program who has service credit in the defined benefit
365	plan of the Florida Retirement System for the period between his
366	or her first eligibility to transfer from the defined benefit
367	plan to the optional retirement program and the actual date of
368	transfer may, during employment, transfer to the optional
369	retirement program a sum representing the present value of the
370	accumulated benefit obligation under the defined benefit
371	retirement program for the period of service credit. Upon
372	transfer, all service credit previously earned under the defined
373	benefit program of the Florida Retirement System during this
374	period is nullified for purposes of entitlement to a future
375	benefit under the defined benefit program of the Florida
376	Retirement System.
377	Section 7.  Paragraph (b) of subsection (1) of section
378	121.055, Florida Statutes, is amended to read:
379	121.055  Senior Management Service Class.-There is hereby
380	established a separate class of membership within the Florida
381	Retirement System to be known as the "Senior Management Service
382	Class," which shall become effective February 1, 1987.
383	(1)
384	(b)1.  Except as provided in subparagraph 2., effective
385	January 1, 1990, participation in the Senior Management Service
386	Class is shall be compulsory for the president of each community
387	college, the manager of each participating city or county, and
388	all appointed district school superintendents. Effective January
389	1, 1994, additional positions may be designated for inclusion in
390	the Senior Management Service Class of the Florida Retirement
391	System, provided that:
392	a.  Positions to be included in the class shall be
393	designated by the local agency employer. Notice of intent to
394	designate positions for inclusion in the class must shall be
395	published once a week for 2 consecutive weeks in a newspaper of
396	general circulation published in the county or counties
397	affected, as provided in chapter 50.
398	b.  Up to 10 nonelective full-time positions may be
399	designated for each local agency employer reporting to the
400	department of Management Services; for local agencies with 100
401	or more regularly established positions, additional nonelective
402	full-time positions may be designated, not to exceed 1 percent
403	of the regularly established positions within the agency.
404	c.  Each position added to the class must be a managerial
405	or policymaking position filled by an employee who is not
406	subject to continuing contract and serves at the pleasure of the
407	local agency employer without civil service protection, and who:
408	(I)  Heads an organizational unit; or
409	(II)  Has responsibility to effect or recommend personnel,
410	budget, expenditure, or policy decisions in his or her areas of
411	responsibility.
412	2.  In lieu of participation in the Senior Management
413	Service Class, members of the Senior Management Service class,
414	pursuant to the provisions of subparagraph 1., may withdraw from
415	the Florida Retirement System altogether. The decision to
416	withdraw from the Florida Retirement System is shall be
417	irrevocable for as long as the employee holds the such a
418	position. Any service creditable under the Senior Management
419	Service Class shall be retained after the member withdraws from
420	the Florida Retirement System; however, additional service
421	credit in the Senior Management Service Class may shall not be
422	earned after such withdrawal. Such members are shall not be
423	eligible to participate in the Senior Management Service
424	Optional Annuity Program.
425	3.  Effective January 1, 2006, through June 30, 2006, an
426	employee who has withdrawn from the Florida Retirement System
427	under subparagraph 2. has one opportunity to elect to
428	participate in either the defined benefit program or the Public
429	Employee Optional Retirement Program of the Florida Retirement
430	System.
431	a.  If the employee elects to participate in the Public
432	Employee Optional Retirement Program, membership shall be
433	prospective, and the applicable provisions of s. 121.4501(4)
434	shall govern the election.
435	b.  If the employee elects to participate in the defined
436	benefit program of the Florida Retirement System, the employee
437	shall, upon payment to the system trust fund of the amount
438	calculated under sub-sub-subparagraph (I), receive service
439	credit for prior service based upon the time during which the
440	employee had withdrawn from the system.
441	(I)  The cost for such credit shall be an amount
442	representing the actuarial accrued liability for the affected
443	period of service. The cost shall be calculated using the
444	discount rate and other relevant actuarial assumptions that were
445	used to value the Florida Retirement System defined benefit plan
446	liabilities in the most recent actuarial valuation. The
447	calculation shall include any service already maintained under
448	the defined benefit plan in addition to the period of
449	withdrawal. The actuarial accrued liability attributable to any
450	service already maintained under the defined benefit plan shall
451	be applied as a credit to the total cost resulting from the
452	calculation. The division shall ensure that the transfer sum is
453	prepared using a formula and methodology certified by an
454	actuary.
455	(II)  The employee must transfer a sum representing the net
456	cost owed for the actuarial accrued liability in sub-sub-
457	subparagraph (I) immediately following the time of such
458	movement, determined assuming that attained service equals the
459	sum of service in the defined benefit program and the period of
460	withdrawal.
461	Section 8.  Section 121.091, Florida Statutes, is amended
462	to read:
463	121.091  Benefits payable under the system.-Benefits may
464	not be paid under this section unless the member has terminated
465	employment as provided in s. 121.021(39)(a) or begun
466	participation in the Deferred Retirement Option Program as
467	provided in subsection (13), and filed a proper application has
468	been filed in the manner prescribed by the department. The
469	department may cancel an application for retirement benefits if
470	when the member or beneficiary fails to timely provide the
471	information and documents required by this chapter and the
472	department's rules. The department shall adopt rules
473	establishing procedures for application for retirement benefits
474	and for the cancellation of such application if when the
475	required information or documents are not received.
476	(1)  NORMAL RETIREMENT BENEFIT.-Upon attaining his or her
477	normal retirement date, the member, upon application to the
478	administrator, shall receive a monthly benefit which shall begin
479	to accrue on the first day of the month of retirement and be
480	payable on the last day of that month and each month thereafter
481	during his or her lifetime. The normal retirement benefit,
482	including any past or additional retirement credit, may not
483	exceed 100 percent of the average final compensation. The amount
484	of monthly benefit shall be calculated as the product of A and
485	B, subject to the adjustment of C, if applicable, as set forth
486	below:
487	(a)1.  For creditable years of Regular Class service, A is
488	1.60 percent of the member's average final compensation, up to
489	the member's normal retirement date. Upon completion of the
490	first year after the normal retirement date, A is 1.63 percent
491	of the member's average final compensation. Following the second
492	year after the normal retirement date, A is 1.65 percent of the
493	member's average final compensation. Following the third year
494	after the normal retirement date, and for subsequent years, A is
495	1.68 percent of the member's average final compensation.
496	2.  For creditable years of special risk service, A is:
497	a.  Two percent of the member's average final compensation
498	for all creditable years prior to October 1, 1974;
499	b.  Three percent of the member's average final
500	compensation for all creditable years after September 30, 1974,
501	and before October 1, 1978;
502	c.  Two percent of the member's average final compensation
503	for all creditable years after September 30, 1978, and before
504	January 1, 1989;
505	d.  Two and two-tenths percent of the member's final
506	monthly compensation for all creditable years after December 31,
507	1988, and before January 1, 1990;
508	e.  Two and four-tenths percent of the member's average
509	final compensation for all creditable years after December 31,
510	1989, and before January 1, 1991;
511	f.  Two and six-tenths percent of the member's average
512	final compensation for all creditable years after December 31,
513	1990, and before January 1, 1992;
514	g.  Two and eight-tenths percent of the member's average
515	final compensation for all creditable years after December 31,
516	1991, and before January 1, 1993;
517	h.  Three percent of the member's average final
518	compensation for all creditable years after December 31, 1992;
519	and
520	i.  Three percent of the member's average final
521	compensation for all creditable years of service after September
522	30, 1978, and before January 1, 1993, for any special risk
523	member who retires after July 1, 2000, or any member of the
524	Special Risk Administrative Support Class entitled to retain the
525	special risk normal retirement date who was a member of the
526	Special Risk Class during the time period and who retires after
527	July 1, 2000.
528	3.  For creditable years of Senior Management Service Class
529	service after January 31, 1987, A is 2 percent;
530	4.  For creditable years of Elected Officers' Class service
531	as a Supreme Court Justice, district court of appeal judge,
532	circuit judge, or county court judge, A is 3 1/3 percent of the
533	member's average final compensation, and for all other
534	creditable service in such class, A is 3 percent of average
535	final compensation;
536	(b)  B is the number of the member's years and any
537	fractional part of a year of creditable service earned
538	subsequent to November 30, 1970; and
539	(c)  C is the normal retirement benefit credit brought
540	forward as of November 30, 1970, by a former member of an
541	existing system. Such normal retirement benefit credit shall be
542	determined as the product of X and Y when X is the percentage of
543	average final compensation which the member would have been
544	eligible to receive if the member had attained his or her normal
545	retirement date as of November 30, 1970, all in accordance with
546	the existing system under which the member is covered on
547	November 30, 1970, and Y is average final compensation as
548	defined in s. 121.021(24). However, any member of an existing
549	retirement system who is eligible to retire and who does retire,
550	become disabled, or die prior to April 15, 1971, may have his or
551	her retirement benefits calculated on the basis of the best 5 of
552	the last 10 years of service.
553	(d)  A member's average final compensation shall be
554	determined by formula to obtain the coverage for the 5 highest
555	fiscal years' salaries, calculated as provided by rule.
556	(2)  BENEFITS PAYABLE FOR DUAL NORMAL RETIREMENT AGES.-If a
557	member accumulates retirement benefits to commence at different
558	normal retirement ages by virtue of having performed duties for
559	an employer which would entitle him or her to benefits as both a
560	member of the Special Risk Class and a member of either the
561	Regular Class, Senior Management Service Class, or Elected
562	Officers' Class, the amount of benefits payable shall be
563	computed separately with respect to each such age and the sum of
564	such computed amounts shall be paid as provided in this section.
565	(3)  EARLY RETIREMENT BENEFIT.-Upon retirement on his or
566	her early retirement date, the member shall receive an immediate
567	monthly benefit that shall begin to accrue on the first day of
568	the month of the retirement date and be payable on the last day
569	of that month and each month thereafter during his or her
570	lifetime. Such benefit shall be calculated as follows:
571	(a)  The amount of each monthly payment shall be computed
572	in the same manner as for a normal retirement benefit, in
573	accordance with subsection (1), but shall be based on the
574	member's average monthly compensation and creditable service as
575	of the member's early retirement date. The benefit so computed
576	shall be reduced by five-twelfths of 1 percent for each complete
577	month by which the early retirement date precedes the normal
578	retirement date of age 62 for a member of the Regular Class,
579	Senior Management Service Class, or the Elected Officers' Class,
580	and age 55 for a member of the Special Risk Class, or age 52 if
581	a Special Risk member has completed 25 years of creditable
582	service in accordance with s. 121.021(29)(b)3.
583	(b)  If the employment of a member is terminated by reason
584	of death subsequent to the completion of 20 years of creditable
585	service, the monthly benefit payable to the member's beneficiary
586	shall be calculated in accordance with subsection (1), but shall
587	be based on average monthly compensation and creditable service
588	as of the date of death. The benefit so computed shall be
589	reduced by five-twelfths of 1 percent for each complete month by
590	which death precedes the normal retirement date specified above
591	or the date on which the member would have attained 30 years of
592	creditable service had he or she survived and continued his or
593	her employment, whichever provides a higher benefit.
594	(4)  DISABILITY RETIREMENT BENEFIT.-
595	(a)  Disability retirement; entitlement and effective
596	date.-
597	1.a.  A member who becomes totally and permanently
598	disabled, as defined in paragraph (b), after completing 5 years
599	of creditable service, or a member who becomes totally and
600	permanently disabled in the line of duty regardless of service,
601	shall be entitled to a monthly disability benefit; except that
602	any member with less than 5 years of creditable service on July
603	1, 1980, or any person who becomes a member of the Florida
604	Retirement System on or after such date must have completed 10
605	years of creditable service prior to becoming totally and
606	permanently disabled in order to receive disability retirement
607	benefits for any disability which occurs other than in the line
608	of duty. However, if a member employed on July 1, 1980, with
609	less than 5 years of creditable service as of that date, becomes
610	totally and permanently disabled after completing 5 years of
611	creditable service and is found not to have attained fully
612	insured status for benefits under the federal Social Security
613	Act, such member shall be entitled to a monthly disability
614	benefit.
615	b.  Effective July 1, 2001, a member of the defined benefit
616	retirement program who becomes totally and permanently disabled,
617	as defined in paragraph (b), after completing 8 years of
618	creditable service, or a member who becomes totally and
619	permanently disabled in the line of duty regardless of service,
620	shall be entitled to a monthly disability benefit.
621	2.  If the division has received from the employer the
622	required documentation of the member's termination of
623	employment, the effective retirement date for a member who
624	applies and is approved for disability retirement shall be
625	established by rule of the division.
626	3.  For a member who is receiving Workers' Compensation
627	payments, the effective disability retirement date may not
628	precede the date the member reaches Maximum Medical Improvement
629	(MMI), unless the member terminates employment prior to reaching
630	MMI.
631	(b)  Total and permanent disability.-A member shall be
632	considered totally and permanently disabled if, in the opinion
633	of the administrator, he or she is prevented, by reason of a
634	medically determinable physical or mental impairment, from
635	rendering useful and efficient service as an officer or
636	employee.
637	(c)  Proof of disability.-The administrator, before
638	approving payment of any disability retirement benefit, shall
639	require proof that the member is totally and permanently
640	disabled as provided herein:
641	1.  Such proof shall include the certification of the
642	member's total and permanent disability by two licensed
643	physicians of the state and such other evidence of disability as
644	the administrator may require, including reports from vocational
645	rehabilitation, evaluation, or testing specialists who have
646	evaluated the applicant for employment. A member whose position
647	with an employer requires that the member work full time outside
648	this state in the United States may include certification by two
649	licensed physicians of the state where the member works.
650	2.  It must be documented that:
651	a.  The member's medical condition occurred or became
652	symptomatic during the time the member was employed in an
653	employee/employer relationship with his or her employer;
654	b.  The member was totally and permanently disabled at the
655	time he or she terminated covered employment; and
656	c.  The member has not been employed with any other
657	employer after such termination.
658	3.  If the application is for in-line-of-duty disability,
659	in addition to the requirements of subparagraph 2., it must be
660	documented by competent medical evidence that the disability was
661	caused by a job-related illness or accident which occurred while
662	the member was in an employee/employer relationship with his or
663	her employer.
664	4.  The unavailability of an employment position that the
665	member is physically and mentally capable of performing will not
666	be considered as proof of total and permanent disability.
667	(d)  Election on appeal.-A member whose application for
668	regular disability retirement has been denied and who has filed
669	an appeal to the State Retirement Commission may, if eligible,
670	elect to receive normal or early service retirement benefits
671	while he or she is awaiting the decision on the appeal. However:
672	1.  If the member elects to receive service retirement
673	benefits and disability benefits are later approved as a result
674	of the appeal, the payment option chosen by the member may not
675	be changed.
676	2.  If the member elects to receive early service
677	retirement and the appeal is later denied, the member may not
678	change his or her election of early retirement.
679
680	Before such regular or early retirement benefits may be paid by
681	the division, the member must provide to the division a written
682	statement indicating that the member understands that such
683	changes are not permitted after he or she begins receiving the
684	benefits.
685	(e)  Disability retirement benefit.-Upon the retirement of
686	a member on his or her disability retirement date, the member
687	shall receive a monthly benefit that shall begin to accrue on
688	the first day of the month of disability retirement and shall be
689	payable on the last day of that month and each month thereafter
690	during his or her lifetime and continued disability.
691	(f)  Computation of disability retirement benefit.-The
692	amount of each monthly payment shall be computed in the same
693	manner as for a normal retirement benefit, in accordance with
694	subsection (1), but shall be based on disability option
695	actuarial equivalency tables and the average monthly
696	compensation and creditable service of the member as of the
697	disability retirement date, subject to the following conditions:
698	1.  If the member's disability occurred in the line of
699	duty, the monthly Option 1 benefit shall not be less than:
700	a.  Forty-two percent of average monthly compensation as of
701	the disability retirement date; or
702	b.  Sixty-five percent of the average monthly compensation
703	as of the disability retirement date for a member of the special
704	risk class who retires on or after July 1, 2000; or
705	2.  If the member's disability occurred other than in the
706	line of duty, the monthly Option 1 benefit shall not be less
707	than 25 percent of average monthly compensation as of the
708	disability retirement date.
709	(g)  Reapplication.-A member, whose initial application for
710	disability retirement has been denied, may reapply for
711	disability benefits. However, such member's reapplication will
712	be considered only if the member presents new medical evidence
713	of a medical condition that existed prior to the member's
714	termination of employment. The division may prescribe by rule
715	procedures for reapplication and for review and approval or
716	disapproval of reapplication.
717	(h)  Recovery from disability.-The administrator may
718	require periodic reexaminations at the expense of the retirement
719	fund. The division may adopt rules establishing procedures for
720	conducting and review of such reexaminations.
721	1.  If the administrator finds that a member who is
722	receiving disability benefits is, at any time prior to his or
723	her normal retirement date, no longer disabled, the
724	administrator shall direct that the benefits be discontinued.
725	The decision of the administrator on this question shall be
726	final and binding. If such member:
727	a.  Does not reenter the employ of an employer and was not
728	vested as of the disability retirement date, he or she shall be
729	entitled to the excess, if any, of his or her accumulated
730	contributions over the total disability benefits received up to
731	the date of recovery.
732	b.  Does not reenter the employ of an employer, but was
733	vested as of the disability retirement date, he or she may elect
734	to receive:
735	(I)  The excess, if any, of his or her accumulated
736	contributions over the total disability benefits received up to
737	the date of recovery; or
738	(II)  A deferred benefit commencing on the last day of the
739	month of the normal retirement date which shall be payable on
740	the last day of the month thereafter during his or her lifetime.
741	The amount of such monthly benefit shall be computed in the same
742	manner as for a normal retirement benefit, in accordance with
743	subsection (1), but shall be based on average monthly
744	compensation and creditable service as of the member's
745	disability retirement date.
746	c.  Reenters employment of an employer within 6 months
747	after recovery, the member's service will be deemed to have been
748	continuous, but the period beginning with the first month for
749	which he or she received a disability benefit payment and ending
750	with the date he or she reentered employment will not be
751	considered as creditable service for the purpose of computing
752	benefits except as provided in sub-subparagraph d. As used in
753	this section, the term "accumulated contributions" for such
754	member means the excess of the member's accumulated
755	contributions as of the disability retirement date over the
756	total disability benefits received under paragraph (e).
757	d.  Terminates his or her disability benefit, reenters
758	covered employment, and is continuously employed for a minimum
759	of 1 year of creditable service, he or she may claim as
760	creditable service the months during which he or she was
761	receiving a disability benefit, upon payment of the required
762	contributions. Contributions shall equal the total required
763	employee and employer contribution rate applicable during the
764	period the retiree received retirement benefits, multiplied
765	times his or her rate of monthly compensation prior to the
766	commencement of disability retirement for each month of the
767	period claimed, plus 4 percent interest until July 1, 1975, and
768	6.5 percent interest thereafter, compounded annually each June
769	30 to the date of payment. If the member does not claim credit
770	for all of the months he or she received disability benefits,
771	the months claimed must be the most recent months of retirement.
772	Such credit for periods of disability, when purchased under the
773	Florida Retirement System, shall apply toward vesting
774	requirements for eligibility to purchase additional credit for
775	other service.
776	2.  Both the member receiving disability benefits who
777	reenters employment and the employer employing such disability
778	retiree shall notify the division immediately upon reemployment,
779	and the division shall terminate such member's disability
780	benefits, effective the first day of the month following the
781	month in which notification of recovery is received. If the
782	member is reemployed with a Florida Retirement System employer
783	at the time of benefit termination, and he or she has received
784	disability retirement benefit and salary payments concurrently
785	prior to notifying the division, he or she may elect within 30
786	days to:
787	a.  Retain the retirement benefits received prior to
788	termination of disability benefits and begin receiving
789	retirement service credit effective upon the date of termination
790	of benefits; or
791	b.  Repay, within 12 months after his or her decision to
792	receive service credit, the retirement benefits received for
793	each month of reemployment prior to termination of disability
794	benefits and begin receiving retirement service credit effective
795	upon the date of reemployment. Any such unpaid benefits shall
796	have compound interest of 6.5 percent added June 30.
797
798	A member may not receive both retirement service credit for
799	employment and retirement benefits for the same month.
800	3.  If, after recovery of disability and reentry into
801	covered employment, the member again becomes disabled and is
802	again approved for disability retirement, the Option 1 monthly
803	retirement benefit shall not be less than the Option 1 monthly
804	benefit calculated at the time of the previous disability, plus
805	any cost of living increases up to the time the disability
806	benefit was terminated upon his or her reentry into covered
807	employment.
808	(i)  Nonadmissible causes of disability.-A member shall not
809	be entitled to receive any disability retirement benefit if the
810	disability is a result of any of the following:
811	1.  Injury or disease sustained by the member while
812	willfully participating in a riot, civil insurrection, or other
813	act of violence or while committing a felony;
814	2.  Injury or disease sustained by the member after his or
815	her employment has terminated; or
816	3.  Intentional, self-inflicted injury.
817	(j)  Disability retirement of justice or judge by order of
818	Supreme Court.-
819	1.  If a member is a justice of the Supreme Court, judge of
820	a district court of appeal, circuit judge, or judge of a county
821	court who has served for 6 years or more as an elected
822	constitutional judicial officer, including service as a judicial
823	officer in any court abolished pursuant to Art. V of the State
824	Constitution, and who is retired for disability by order of the
825	Supreme Court upon recommendation of the Judicial Qualifications
826	Commission pursuant to the provisions of Art. V of the State
827	Constitution, the member's Option 1 monthly benefit as provided
828	in subparagraph (6)(a)1. shall not be less than two-thirds of
829	his or her monthly compensation as of the member's disability
830	retirement date. Such a member may alternatively elect to
831	receive a disability retirement benefit under any other option
832	as provided in paragraph (6)(a).
833	2.  Should any justice or judge who is a member of the
834	Florida Retirement System be retired for disability by order of
835	the Supreme Court upon recommendation of the Judicial
836	Qualifications Commission pursuant to the provisions of Art. V
837	of the State Constitution, then all contributions to his or her
838	account and all contributions made on his or her behalf by the
839	employer shall be transferred to and deposited in the General
840	Revenue Fund of the state, and there is hereby appropriated
841	annually out of the General Revenue Fund, to be paid into the
842	Florida Retirement System Fund, an amount necessary to pay the
843	benefits of all justices and judges retired from the Florida
844	Retirement System pursuant to Art. V of the State Constitution.
845	(5)  TERMINATION BENEFITS.-A member whose employment is
846	terminated prior to retirement retains membership rights to
847	previously earned member-noncontributory service credit, and to
848	member-contributory service credit, if the member leaves the
849	member contributions on deposit in his or her retirement
850	account. If a terminated member receives a refund of member
851	contributions, such member may reinstate membership rights to
852	the previously earned service credit represented by the refund
853	by completing 1 year of creditable service and repaying the
854	refunded member contributions, plus interest.
855	(a)  A member whose employment is terminated for any reason
856	other than death or retirement prior to becoming vested is
857	entitled to the return of his or her accumulated contributions
858	as of the date of termination.
859	(b)  A member whose employment is terminated for any reason
860	other than death or retirement after becoming vested may elect
861	to receive a deferred monthly benefit which shall begin to
862	accrue on the first day of the month of normal or early
863	retirement and shall be payable on the last day of that month
864	and each month thereafter during his or her lifetime. The amount
865	of monthly benefit shall be computed in the same manner as for a
866	normal retirement benefit in accordance with subsection (1) or
867	early retirement benefit in accordance with s. 121.021(30), but
868	based on average monthly compensation and creditable service as
869	of the date of termination.
870	(c)  In lieu of the deferred monthly benefit provided in
871	paragraph (b), the terminated member may elect to receive a
872	lump-sum amount equal to his or her accumulated contributions as
873	of the date of termination.
874	(d)  If any retired member dies without having received in
875	benefit payments an amount equal to his or her accumulated
876	contributions, there shall be payable to his or her designated
877	beneficiary an amount equal to the excess, if any, of the
878	member's accumulated contributions over the total monthly
879	payments made to the member prior to the date of death.
880	(e)  A member shall be deemed a terminated member when
881	termination of employment has occurred as provided in s.
882	121.021(39).
883	(f)  Any member who has been found guilty by a verdict of a
884	jury, or by the court trying the case without a jury, of
885	committing, aiding, or abetting any embezzlement or theft from
886	his or her employer, bribery in connection with the employment,
887	or other felony specified in chapter 838, except ss. 838.15 and
888	838.16, committed prior to retirement, or who has entered a plea
889	of guilty or of nolo contendere to such crime, or any member
890	whose employment is terminated by reason of the member's
891	admitted commitment, aiding, or abetting of an embezzlement or
892	theft from his or her employer, bribery, or other felony
893	specified in chapter 838, except ss. 838.15 and 838.16, shall
894	forfeit all rights and benefits under this chapter, except the
895	return of his or her accumulated contributions as of the date of
896	termination.
897	(g)  Any elected official who is convicted by the Senate of
898	an impeachable offense shall forfeit all rights and benefits
899	under this chapter, except the return of his or her accumulated
900	contributions as of the date of the conviction.
901	(h)  Any member who, prior to retirement, is adjudged by a
902	court of competent jurisdiction to have violated any state law
903	against strikes by public employees, or who has been found
904	guilty by such court of violating any state law prohibiting
905	strikes by public employees, shall forfeit all rights and
906	benefits under this chapter, except the return of his or her
907	accumulated contributions as of the date of the conviction.
908	(i)  The division may not pay benefits to any member
909	convicted of a felony committed on or after October 1, 2008,
910	defined in s. 800.04 against a victim younger than 16 years of
911	age, or defined in chapter 794 against a victim younger than 18
912	years of age, through the use or attempted use of power, rights,
913	privileges, duties, or position of the member's public office or
914	employment position. However, the division shall return the
915	member's accumulated contributions, if any, that the member
916	accumulated as of the date of conviction.
917	(j)  Any beneficiary who by a verdict of a jury or by the
918	court trying the case without a jury is found guilty, or who has
919	entered a plea of guilty or nolo contendere, of unlawfully and
920	intentionally killing or procuring the death of the member
921	forfeits all rights to the deceased member's benefits under this
922	chapter, and the benefits will be paid as if such beneficiary
923	had predeceased the decedent.
924	(k)  Benefits shall not be paid by the division pending
925	final resolution of such charges against a member or beneficiary
926	if the resolution of such charges could require the forfeiture
927	of benefits as provided in paragraph (f), paragraph (g),
928	paragraph (h), paragraph (i), or paragraph (j).
929	(6)  OPTIONAL FORMS OF RETIREMENT BENEFITS AND DISABILITY
930	RETIREMENT BENEFITS.-
931	(a)  Prior to the receipt of the first monthly retirement
932	payment, a member shall elect to receive the retirement benefits
933	to which he or she is entitled under subsection (1), subsection
934	(2), subsection (3), or subsection (4) in accordance with one of
935	the following options:
936	1.  The maximum retirement benefit payable to the member
937	during his or her lifetime.
938	2.  A decreased retirement benefit payable to the member
939	during his or her lifetime and, in the event of his or her death
940	within a period of 10 years after retirement, the same monthly
941	amount payable for the balance of such 10-year period to his or
942	her beneficiary or, in case the beneficiary is deceased, in
943	accordance with subsection (8) as though no beneficiary had been
944	named.
945	3.  A decreased retirement benefit payable during the joint
946	lifetime of both the member and his or her joint annuitant and
947	which, after the death of either, shall continue during the
948	lifetime of the survivor in the same amount, subject to the
949	provisions of subsection (12).
950	4.  A decreased retirement benefit payable during the joint
951	lifetime of the member and his or her joint annuitant and which,
952	after the death of either, shall continue during the lifetime of
953	the survivor in an amount equal to 66 2/3 percent of the amount
954	that was payable during the joint lifetime of the member and his
955	or her joint annuitant, subject to the provisions of subsection
956	(12).
957
958	The spouse of any member who elects to receive the benefit
959	provided under subparagraph 1. or subparagraph 2. shall be
960	notified of and shall acknowledge any such election. The
961	division shall establish by rule a method for selecting the
962	appropriate actuarial factor for optional forms of benefits
963	selected under subparagraphs 3. and 4., based on the age of the
964	member and the joint annuitant.
965	(b)  The benefit payable under any option stated above
966	shall be the actuarial equivalent, based on tables adopted by
967	the administrator for this purpose, of the amount to which the
968	member was otherwise entitled.
969	(c)  A member who elects the option in subparagraph (a)2.
970	shall, in accordance with subsection (8), designate one or more
971	persons to receive the benefits payable in the event of his or
972	her death. Such persons shall be the beneficiaries of the
973	member. The member may also designate one or more contingent
974	beneficiaries to receive any benefits remaining upon the death
975	of the primary beneficiary.
976	(d)  A member who elects the option in subparagraph (a)3.
977	or subparagraph (a)4. shall, on a form provided for that
978	purpose, designate a joint annuitant to receive the benefits
979	which continue to be payable upon the death of the member. After
980	benefits have commenced under the option in subparagraph (a)3.
981	or subparagraph (a)4., the following shall apply:
982	1.  A retired member may change his or her designation of a
983	joint annuitant only twice. If such a retired member desires to
984	change his or her designation of a joint annuitant, he or she
985	shall file with the division a notarized "change of joint
986	annuitant" form and shall notify the former joint annuitant in
987	writing of such change. Effective the first day of the next
988	month following receipt by the division of a completed change of
989	joint annuitant form, the division shall adjust the member's
990	monthly benefit by the application of actuarial tables and
991	calculations developed to ensure that the benefit paid is the
992	actuarial equivalent of the present value of the member's
993	current benefit. The consent of a retired member's first
994	designated joint annuitant to any such change shall not be
995	required. However, if either the member or the joint annuitant
996	dies before the effective date of the request for change of
997	joint annuitant, the requested change shall be void, and
998	survivor benefits, if any, shall be paid as if no request had
999	been made.
1000	2.  In the event of the dissolution of marriage of a
1001	retired member and a joint annuitant, such member may make an
1002	election to nullify the joint annuitant designation of the
1003	former spouse, unless there is an existing qualified domestic
1004	relations order preventing such action. The member shall file
1005	with the division a written, notarized nullification which shall
1006	be effective on the first day of the next month following
1007	receipt by the division. Benefits shall be paid as if the former
1008	spouse predeceased the member. A member who makes such an
1009	election may not reverse the nullification but may designate a
1010	new joint annuitant in accordance with subparagraph 1.
1011	(e)  The election of an option shall be null and void if
1012	the member dies before the effective date of retirement.
1013	(f)  A member who elects to receive benefits under the
1014	option in subparagraph (a)3. may designate one or more qualified
1015	persons, either a spouse or other dependent, as his or her joint
1016	annuitant to receive the benefits after the member's death in
1017	whatever proportion he or she so assigns to each person named as
1018	joint annuitant. The division shall adopt appropriate actuarial
1019	tables and calculations necessary to ensure that the benefit
1020	paid is the actuarial equivalent of the benefit to which the
1021	member is otherwise entitled under the option in subparagraph
1022	(a)1.
1023	(g)  Upon the death of a retired member or beneficiary
1024	receiving monthly benefits under this chapter, the monthly
1025	benefits shall be paid through the last day of the month of
1026	death and shall terminate, or be adjusted, if applicable, as of
1027	that date in accordance with the optional form of benefit
1028	selected at the time of retirement.
1029	(h)  The option selected or determined for payment of
1030	benefits as provided in this section shall be final and
1031	irrevocable at the time a benefit payment is cashed or deposited
1032	or credited to the Deferred Retirement Option Program as
1033	provided in subsection (13).
1034	(7)  DEATH BENEFITS.-
1035	(a)  If the employment of a member is terminated by reason
1036	of his or her death prior to being vested, except as provided in
1037	paragraph (f), there shall be payable to his or her designated
1038	beneficiary the member's accumulated contributions.
1039	(b)  If the employment of an active member who may or may
1040	not have applied for retirement is terminated by reason of his
1041	or her death subsequent to becoming vested and prior to his or
1042	her effective date of retirement, if established, it shall be
1043	assumed that the member retired as of the date of death in
1044	accordance with subsection (1) if eligible for normal retirement
1045	benefits, subsection (2) if eligible for benefits payable for
1046	dual normal retirement, or subsection (3) if eligible for early
1047	retirement benefits. Benefits payable to the designated
1048	beneficiary shall be as follows:
1049	1.  For a beneficiary who qualifies as a joint annuitant,
1050	the optional form of payment provided in accordance with
1051	subparagraph (6)(a)3. shall be paid for the joint annuitant's
1052	lifetime.
1053	2.  For a beneficiary who does not qualify as a joint
1054	annuitant, no continuing monthly benefit shall be paid and the
1055	beneficiary shall be entitled only to the return of the member's
1056	personal contributions. If there is no monetary interest in the
1057	member's retirement account for which such beneficiary is
1058	eligible, the beneficiary shall be the next named beneficiary
1059	or, if no other beneficiary is named, the beneficiary shall be
1060	the next eligible beneficiary according to subsection (8).
1061	(c)  If a retiring member dies on or after the effective
1062	date of retirement, but prior to a benefit payment being cashed
1063	or deposited, or credited to the Deferred Retirement Option
1064	Program, benefits shall be paid as follows:
1065	1.  For a designated beneficiary who qualifies as a joint
1066	annuitant, benefits shall be paid in the optional form of
1067	payment provided in subparagraph (6)(a)3. for the joint
1068	annuitant's lifetime or, if the member chose the optional form
1069	of payment provided in subparagraph (6)(a)2., the joint
1070	annuitant may select the form provided in either subparagraph
1071	(6)(a)2. or subparagraph (6)(a)3.
1072	2.  For a designated beneficiary who does not qualify as a
1073	joint annuitant, any benefits payable shall be paid as provided
1074	in the option selected by the member; or if the member has not
1075	selected an option, benefits shall be paid in the optional form
1076	of payment provided in subparagraph (6)(a)1.
1077	(d)  Notwithstanding any other provision in this chapter to
1078	the contrary, with the exception of the Deferred Retirement
1079	Option Program, as provided in subsection (13):
1080	1.  The surviving spouse of any member killed in the line
1081	of duty may receive a monthly pension equal to one-half of the
1082	monthly salary being received by the member at the time of death
1083	for the rest of the surviving spouse's lifetime or, if the
1084	member was vested, such surviving spouse may elect to receive a
1085	benefit as provided in paragraph (b). Benefits provided by this
1086	paragraph shall supersede any other distribution that may have
1087	been provided by the member's designation of beneficiary.
1088	2.  If the surviving spouse of a member killed in the line
1089	of duty dies, the monthly payments which would have been payable
1090	to such surviving spouse had such surviving spouse lived shall
1091	be paid for the use and benefit of such member's child or
1092	children under 18 years of age and unmarried until the 18th
1093	birthday of the member's youngest child.
1094	3.  If a member killed in the line of duty leaves no
1095	surviving spouse but is survived by a child or children under 18
1096	years of age, the benefits provided by subparagraph 1., normally
1097	payable to a surviving spouse, shall be paid for the use and
1098	benefit of such member's child or children under 18 years of age
1099	and unmarried until the 18th birthday of the member's youngest
1100	child.
1101	4.  The surviving spouse of a member whose benefit
1102	terminated because of remarriage shall have the benefit
1103	reinstated beginning July 1, 1993, at an amount that would have
1104	been payable had the benefit not been terminated.
1105	(e)  The surviving spouse or other dependent of any member,
1106	except a member who participated in the Deferred Retirement
1107	Option Program, whose employment is terminated by death shall,
1108	upon application to the administrator, be permitted to pay the
1109	required contributions for any service performed by the member
1110	which could have been claimed by the member at the time of his
1111	or her death. Such service shall be added to the creditable
1112	service of the member and shall be used in the calculation of
1113	any benefits which may be payable to the surviving spouse or
1114	other surviving dependent.
1115	(f)  Notwithstanding any other provisions in this chapter
1116	to the contrary and upon application to the administrator, an
1117	eligible joint annuitant, of a member whose employment is
1118	terminated by death within 1 year of such member satisfying the
1119	service requirements for vesting and retirement eligibility,
1120	shall be permitted to purchase only the additional service
1121	credit necessary to vest and qualify for retirement benefits,
1122	not to exceed a total of 1 year of credit, by one or a
1123	combination of the following methods:
1124	1.  Such eligible joint annuitant may use the deceased
1125	member's accumulated hours of annual, sick, and compensatory
1126	leave to purchase additional creditable service, on an hour by
1127	hour basis, provided that such deceased member's accumulated
1128	leave is sufficient to cover the additional months required. For
1129	each month of service credit needed prior to the final month,
1130	credit for the total number of work hours in that month must be
1131	purchased, using an equal number of the deceased member's
1132	accumulated leave hours. Service credit required for the final
1133	month in which the deceased member would have become vested
1134	shall be awarded upon the purchase of 1 hour of credit. Such
1135	eligible joint annuitant shall pay the contribution rate in
1136	effect for the period of time being claimed for the deceased
1137	member's class of membership, multiplied by such member's
1138	monthly salary at the time of death, plus 6.5 percent interest
1139	compounded annually. The accumulated leave payment used in the
1140	average final compensation shall not include that portion of the
1141	payment that represents any leave hours used in the purchase of
1142	such creditable service.
1143	2.  Such eligible joint annuitant may purchase additional
1144	months of creditable service for any periods of out-of-state
1145	service as provided in s. 121.1115, and in-state service as
1146	provided in s. 121.1122, that the deceased member would have
1147	been eligible to purchase prior to his or her death.
1148
1149	Service purchased under this paragraph shall be added to the
1150	creditable service of the member and used to vest for retirement
1151	eligibility, and shall be used in the calculation of any
1152	benefits which may be payable to the eligible joint annuitant.
1153	Any benefits paid in accordance with this paragraph shall only
1154	be made prospectively.
1155	(g)  Notwithstanding any other provisions in this chapter
1156	to the contrary, if any member who is vested dies and the
1157	surviving spouse receives a refund of the accumulated
1158	contributions made to the retirement trust fund, such spouse may
1159	pay to the Division of Retirement an amount equal to the sum of
1160	the amount of the deceased member's accumulated contributions
1161	previously refunded plus interest at 4 percent compounded
1162	annually each June 30 from the date of refund until July 1,
1163	1975, and 6.5 percent interest compounded annually thereafter,
1164	until full payment is made, and receive the monthly retirement
1165	benefit as provided in paragraph (b).
1166	(h)  The designated beneficiary who is the surviving spouse
1167	or other dependent of a member whose employment is terminated by
1168	death subsequent to becoming vested, but prior to actual
1169	retirement, may elect to receive a deferred monthly benefit as
1170	if the member had lived and had elected a deferred monthly
1171	benefit, as provided in paragraph (5)(b), calculated on the
1172	basis of the average final compensation and creditable service
1173	of the member at his or her death and the age the member would
1174	have attained on the commencement date of the deferred benefit
1175	elected by the beneficiary, paid in accordance with option 3 of
1176	paragraph (6)(a).
1177	(8)  DESIGNATION OF BENEFICIARIES.-
1178	(a)  Each member may, on a form provided for that purpose,
1179	signed and filed with the division, designate a choice of one or
1180	more persons, named sequentially or jointly, as his or her
1181	beneficiary who shall receive the benefits, if any, which may be
1182	payable in the event of the member's death pursuant to the
1183	provisions of this chapter. If no beneficiary is named in the
1184	manner provided above, or if no beneficiary designated by the
1185	member survives the member, the beneficiary shall be the spouse
1186	of the deceased, if living. If the member's spouse is not alive
1187	at his or her death, the beneficiary shall be the living
1188	children of the member. If no children survive, the beneficiary
1189	shall be the member's father or mother, if living; otherwise,
1190	the beneficiary shall be the member's estate. The beneficiary
1191	most recently designated by a member on a form or letter filed
1192	with the division shall be the beneficiary entitled to any
1193	benefits payable at the time of the member's death, except that
1194	benefits shall be paid as provided in paragraph (7)(d) when
1195	death occurs in the line of duty. Notwithstanding any other
1196	provisions in this subsection to the contrary, for a member who
1197	dies prior to his or her effective date of retirement on or
1198	after January 1, 1999, the spouse at the time of death shall be
1199	the member's beneficiary unless such member designates a
1200	different beneficiary as provided herein subsequent to the
1201	member's most recent marriage.
1202	(b)  A designated beneficiary of a retirement account for
1203	whom there is a monetary interest may disclaim his or her
1204	monetary interest as provided in chapter 739 and in accordance
1205	with division rules governing such disclaimers. Such disclaimer
1206	must be filed within 24 months after the event that created the
1207	interest, that is, the death of the member or annuitant.
1208	(c)  Notwithstanding the member's designation of benefits
1209	to be paid through a trust to a beneficiary that is a natural
1210	person as provided in s. 121.021(46), and notwithstanding the
1211	provisions of the trust, benefits shall be paid directly to the
1212	beneficiary if the person is no longer a minor or an
1213	incapacitated person as defined in s. 744.102.
1214	(9)  EMPLOYMENT AFTER RETIREMENT; LIMITATION.-
1215	(a)  Any person who is retired under this chapter, except
1216	under the disability retirement provisions of subsection (4),
1217	may be employed by an employer that does not participate in a
1218	state-administered retirement system and receive compensation
1219	from that employment without limiting or restricting in any way
1220	the retirement benefits payable to that person.
1221	(b)  Any person whose retirement is effective before July
1222	1, 2010, or whose participation in the Deferred Retirement
1223	Option Program terminates before July 1, 2010, except under the
1224	disability retirement provisions of subsection (4) or as
1225	provided in s. 121.053, may be reemployed by an employer that
1226	participates in a state-administered retirement system and
1227	receive retirement benefits and compensation from that employer,
1228	except that the person may not be reemployed by an employer
1229	participating in the Florida Retirement System before meeting
1230	the definition of termination in s. 121.021 and may not receive
1231	both a salary from the employer and retirement benefits for 12
1232	calendar months immediately subsequent to the date of
1233	retirement. However, a DROP participant shall continue
1234	employment and receive a salary during the period of
1235	participation in the Deferred Retirement Option Program, as
1236	provided in subsection (13).
1237	1.  A retiree who violates such reemployment limitation
1238	before completion of the 12-month limitation period must give
1239	timely notice of this fact in writing to the employer and to the
1240	Division of Retirement or the state board and shall have his or
1241	her retirement benefits suspended for the months employed or the
1242	balance of the 12-month limitation period as required in sub-
1243	subparagraphs b. and c. A retiree employed in violation of this
1244	paragraph and an employer who employs or appoints such person
1245	are jointly and severally liable for reimbursement to the
1246	retirement trust fund, including the Florida Retirement System
1247	Trust Fund and the Public Employee Optional Retirement
1248	Investment Program Trust Fund, from which the benefits were
1249	paid. The employer must have a written statement from the
1250	retiree that he or she is not retired from a state-administered
1251	retirement system. Retirement benefits shall remain suspended
1252	until repayment has been made. Benefits suspended beyond the
1253	reemployment limitation shall apply toward repayment of benefits
1254	received in violation of the reemployment limitation.
1255	a.  A district school board may reemploy a retiree as a
1256	substitute or hourly teacher, education paraprofessional,
1257	transportation assistant, bus driver, or food service worker on
1258	a noncontractual basis after he or she has been retired for 1
1259	calendar month. A district school board may reemploy a retiree
1260	as instructional personnel, as defined in s. 1012.01(2)(a), on
1261	an annual contractual basis after he or she has been retired for
1262	1 calendar month. Any member who is reemployed within 1 calendar
1263	month after retirement shall void his or her application for
1264	retirement benefits. District school boards reemploying such
1265	teachers, education paraprofessionals, transportation
1266	assistants, bus drivers, or food service workers are subject to
1267	the retirement contribution required by subparagraph 2.
1268	b.  A community college board of trustees may reemploy a
1269	retiree as an adjunct instructor or as a participant in a phased
1270	retirement program within the Florida Community College System,
1271	after he or she has been retired for 1 calendar month. A member
1272	who is reemployed within 1 calendar month after retirement shall
1273	void his or her application for retirement benefits. Boards of
1274	trustees reemploying such instructors are subject to the
1275	retirement contribution required in subparagraph 2. A retiree
1276	may be reemployed as an adjunct instructor for no more than 780
1277	hours during the first 12 months of retirement. A retiree
1278	reemployed for more than 780 hours during the first 12 months of
1279	retirement must give timely notice in writing to the employer
1280	and to the Division of Retirement or the state board of the date
1281	he or she will exceed the limitation. The division shall suspend
1282	his or her retirement benefits for the remainder of the 12
1283	months of retirement. Any retiree employed in violation of this
1284	sub-subparagraph and any employer who employs or appoints such
1285	person without notifying the division to suspend retirement
1286	benefits are jointly and severally liable for any benefits paid
1287	during the reemployment limitation period. The employer must
1288	have a written statement from the retiree that he or she is not
1289	retired from a state-administered retirement system. Any
1290	retirement benefits received by the retiree while reemployed in
1291	excess of 780 hours during the first 12 months of retirement
1292	must be repaid to the Florida Retirement System Trust Fund, and
1293	retirement benefits shall remain suspended until repayment is
1294	made. Benefits suspended beyond the end of the retiree's first
1295	12 months of retirement shall apply toward repayment of benefits
1296	received in violation of the 780-hour reemployment limitation.
1297	c.  The State University System may reemploy a retiree as
1298	an adjunct faculty member or as a participant in a phased
1299	retirement program within the State University System after the
1300	retiree has been retired for 1 calendar month. A member who is
1301	reemployed within 1 calendar month after retirement shall void
1302	his or her application for retirement benefits. The State
1303	University System is subject to the retired contribution
1304	required in subparagraph 2., as appropriate. A retiree may be
1305	reemployed as an adjunct faculty member or a participant in a
1306	phased retirement program for no more than 780 hours during the
1307	first 12 months of his or her retirement. A retiree reemployed
1308	for more than 780 hours during the first 12 months of retirement
1309	must give timely notice in writing to the employer and to the
1310	Division of Retirement or the state board of the date he or she
1311	will exceed the limitation. The division shall suspend his or
1312	her retirement benefits for the remainder of the 12 months. Any
1313	retiree employed in violation of this sub-subparagraph and any
1314	employer who employs or appoints such person without notifying
1315	the division to suspend retirement benefits are jointly and
1316	severally liable for any benefits paid during the reemployment
1317	limitation period. The employer must have a written statement
1318	from the retiree that he or she is not retired from a state-
1319	administered retirement system. Any retirement benefits received
1320	by the retiree while reemployed in excess of 780 hours during
1321	the first 12 months of retirement must be repaid to the Florida
1322	Retirement System Trust Fund, and retirement benefits shall
1323	remain suspended until repayment is made. Benefits suspended
1324	beyond the end of the retiree's first 12 months of retirement
1325	shall apply toward repayment of benefits received in violation
1326	of the 780-hour reemployment limitation.
1327	d.  The Board of Trustees of the Florida School for the
1328	Deaf and the Blind may reemploy a retiree as a substitute
1329	teacher, substitute residential instructor, or substitute nurse
1330	on a noncontractual basis after he or she has been retired for 1
1331	calendar month. Any member who is reemployed within 1 calendar
1332	month after retirement shall void his or her application for
1333	retirement benefits. The Board of Trustees of the Florida School
1334	for the Deaf and the Blind reemploying such teachers,
1335	residential instructors, or nurses is subject to the retirement
1336	contribution required by subparagraph 2.
1337	e.  A developmental research school may reemploy a retiree
1338	as a substitute or hourly teacher or an education
1339	paraprofessional as defined in s. 1012.01(2) on a noncontractual
1340	basis after he or she has been retired for 1 calendar month. A
1341	developmental research school may reemploy a retiree as
1342	instructional personnel, as defined in s. 1012.01(2)(a), on an
1343	annual contractual basis after he or she has been retired for 1
1344	calendar month after retirement. Any member who is reemployed
1345	within 1 calendar month voids his or her application for
1346	retirement benefits. A developmental research school that
1347	reemploys retired teachers and education paraprofessionals is
1348	subject to the retirement contribution required by subparagraph
1349	2.
1350	f.  A charter school may reemploy a retiree as a substitute
1351	or hourly teacher on a noncontractual basis after he or she has
1352	been retired for 1 calendar month. A charter school may reemploy
1353	a retired member as instructional personnel, as defined in s.
1354	1012.01(2)(a), on an annual contractual basis after he or she
1355	has been retired for 1 calendar month after retirement. Any
1356	member who is reemployed within 1 calendar month voids his or
1357	her application for retirement benefits. A charter school that
1358	reemploys such teachers is subject to the retirement
1359	contribution required by subparagraph 2.
1360	2.  The employment of a retiree or DROP participant of a
1361	state-administered retirement system does not affect the average
1362	final compensation or years of creditable service of the retiree
1363	or DROP participant. Before July 1, 1991, upon employment of any
1364	person, other than an elected officer as provided in s. 121.053,
1365	who is retired under a state-administered retirement program,
1366	the employer shall pay retirement contributions in an amount
1367	equal to the unfunded actuarial liability portion of the
1368	employer contribution which would be required for regular
1369	members of the Florida Retirement System. Effective July 1,
1370	1991, contributions shall be made as provided in s. 121.122 for
1371	retirees who have renewed membership or, as provided in
1372	subsection (13), for DROP participants.
1373	3.  Any person who is holding an elective public office
1374	which is covered by the Florida Retirement System and who is
1375	concurrently employed in nonelected covered employment may elect
1376	to retire while continuing employment in the elective public
1377	office if he or she terminates his or her nonelected covered
1378	employment. Such person shall receive his or her retirement
1379	benefits in addition to the compensation of the elective office
1380	without regard to the time limitations otherwise provided in
1381	this subsection. A person who seeks to exercise the provisions
1382	of this subparagraph as they existed before May 3, 1984, may not
1383	be deemed to be retired under those provisions, unless such
1384	person is eligible to retire under this subparagraph, as amended
1385	by chapter 84-11, Laws of Florida.
1386	(c)  Any person whose retirement is effective on or after
1387	July 1, 2010, or whose participation in the Deferred Retirement
1388	Option Program terminates on or after July 1, 2010, who is
1389	retired under this chapter, except under the disability
1390	retirement provisions of subsection (4) or as provided in s.
1391	121.053, may be reemployed by an employer that participates in a
1392	state-administered retirement system and receive retirement
1393	benefits and compensation from that employer. However, a person
1394	may not be reemployed by an employer participating in the
1395	Florida Retirement System before meeting the definition of
1396	termination in s. 121.021 and may not receive both a salary from
1397	the employer and retirement benefits for 6 calendar months after
1398	meeting the definition of termination. However, a DROP
1399	participant shall continue employment and receive a salary
1400	during the period of participation in the Deferred Retirement
1401	Option Program, as provided in subsection (13).
1402	1.  The reemployed retiree may not renew membership in the
1403	Florida Retirement System.
1404	2.  The employer shall pay retirement contributions in an
1405	amount equal to the unfunded actuarial liability portion of the
1406	employer contribution that would be required for active members
1407	of the Florida Retirement System in addition to the
1408	contributions required by s. 121.76.
1409	3.  A retiree initially reemployed in violation of this
1410	paragraph and an employer that employs or appoints such person
1411	are jointly and severally liable for reimbursement of any
1412	retirement benefits paid to the retirement trust fund from which
1413	the benefits were paid, including the Florida Retirement System
1414	Trust Fund and the Public Employee Optional Retirement
1415	Investment Program Trust Fund, as appropriate. The employer must
1416	have a written statement from the employee that he or she is not
1417	retired from a state-administered retirement system. Retirement
1418	benefits shall remain suspended until repayment is made.
1419	Benefits suspended beyond the end of the retiree's 6-month
1420	reemployment limitation period shall apply toward the repayment
1421	of benefits received in violation of this paragraph.
1422	(d)  The provisions of this subsection apply to retirees,
1423	as defined in s. 121.4501(2), of the defined contribution Public
1424	Employee Optional Retirement program, subject to the following
1425	conditions:
1426	1.  The retirees may not be reemployed with an employer
1427	participating in the Florida Retirement System until such person
1428	has been retired for 6 calendar months.
1429	2.  A retiree employed in violation of this subsection and
1430	an employer that employs or appoints such person are jointly and
1431	severally liable for reimbursement of any benefits paid to the
1432	retirement trust fund from which the benefits were paid,
1433	including the Retirement System Trust Fund and the Public
1434	Employee Optional Retirement Investment Program Trust Fund, as
1435	appropriate. The employer must have a written statement from the
1436	retiree that he or she is not retired from a state-administered
1437	retirement system.
1438	(e)  The limitations of this subsection apply to
1439	reemployment in any capacity irrespective of the category of
1440	funds from which the person is compensated.
1441	(10)  FUTURE BENEFITS BASED ON ACTUARIAL DATA.-It is the
1442	intent of the Legislature that future benefit increases enacted
1443	into law in this chapter shall be financed concurrently by
1444	increased contributions or other adequate funding, and such
1445	funding shall be based on sound actuarial data as developed by
1446	the actuary or state retirement actuary, as provided in ss.
1447	121.021(6) and 121.192.
1448	(11)  A member who becomes eligible to retire and has
1449	accumulated the maximum benefit of 100 percent of average final
1450	compensation may continue in active service, and, if upon the
1451	member's retirement the member elects to receive a retirement
1452	compensation pursuant to subsection (2), subsection (6), or
1453	subsection (7), the actuarial equivalent percentage factor
1454	applicable to the age of such member at the time the member
1455	reached the maximum benefit and to the age, at that time, of the
1456	member's spouse shall determine the amount of benefits to be
1457	paid.
1458	(12)  SPECIAL PROVISIONS FOR PAYMENT OF CERTAIN SURVIVOR
1459	BENEFITS.-Notwithstanding any provision of this chapter to the
1460	contrary, for members with an effective date of retirement, or
1461	date of death if prior to retirement, on or after January 1,
1462	1996, the named joint annuitant, as defined in s.
1463	121.021(28)(b), who is eligible to receive benefits under
1464	subparagraph (6)(a)3. or subparagraph (6)(a)4., shall receive
1465	the maximum monthly retirement benefit that would have been
1466	payable to the member under subparagraph (6)(a)1.; however,
1467	payment of such benefit shall cease the month the joint
1468	annuitant attains age 25 unless such joint annuitant is disabled
1469	and incapable of self-support, in which case, benefits shall
1470	cease when the joint annuitant is no longer disabled. The
1471	administrator may require proof of disability or continued
1472	disability in the same manner as is provided for a member
1473	seeking or receiving a disability retirement benefit under
1474	subsection (4).
1475	(13)  DEFERRED RETIREMENT OPTION PROGRAM.-In general, and
1476	subject to this section, the Deferred Retirement Option Program,
1477	hereinafter referred to as DROP, is a program under which an
1478	eligible member of the Florida Retirement System may elect to
1479	participate, deferring receipt of retirement benefits while
1480	continuing employment with his or her Florida Retirement System
1481	employer. The deferred monthly benefits shall accrue in the
1482	Florida Retirement System on behalf of the participant, plus
1483	interest compounded monthly, for the specified period of the
1484	DROP participation, as provided in paragraph (c). Upon
1485	termination of employment, the participant shall receive the
1486	total DROP benefits and begin to receive the previously
1487	determined normal retirement benefits. Participation in the DROP
1488	does not guarantee employment for the specified period of DROP.
1489	Participation in DROP by an eligible member beyond the initial
1490	60-month period as authorized in this subsection shall be on an
1491	annual contractual basis for all participants.
1492	(a)  Eligibility of member to participate in DROP.-All
1493	active Florida Retirement System members in a regularly
1494	established position, and all active members of the Teachers'
1495	Retirement System established in chapter 238 or the State and
1496	County Officers' and Employees' Retirement System established in
1497	chapter 122, which are consolidated within the Florida
1498	Retirement System under s. 121.011, are eligible to elect
1499	participation in DROP if:
1500	1.  The member is not a renewed member under s. 121.122 or
1501	a member of the State Community College System Optional
1502	Retirement Program under s. 121.051, the Senior Management
1503	Service Optional Annuity Program under s. 121.055, or the
1504	optional retirement program for the State University System
1505	under s. 121.35.
1506	2.  Except as provided in subparagraph 6., election to
1507	participate is made within 12 months immediately following the
1508	date on which the member first reaches normal retirement date,
1509	or, for a member who reaches normal retirement date based on
1510	service before he or she reaches age 62, or age 55 for Special
1511	Risk Class members, election to participate may be deferred to
1512	the 12 months immediately following the date the member attains
1513	age 57, or age 52 for Special Risk Class members. A member who
1514	delays DROP participation during the 12-month period immediately
1515	following his or her maximum DROP deferral date, except as
1516	provided in subparagraph 6., loses a month of DROP participation
1517	for each month delayed. A member who fails to make an election
1518	within the 12-month limitation period forfeits all rights to
1519	participate in DROP. The member shall advise his or her employer
1520	and the division in writing of the date DROP begins. The
1521	beginning date may be subsequent to the 12-month election period
1522	but must be within the original 60-month participation period
1523	provided in subparagraph (b)1. When establishing eligibility of
1524	the member to participate in DROP, the member may elect to
1525	include or exclude any optional service credit purchased by the
1526	member from the total service used to establish the normal
1527	retirement date. A member who has dual normal retirement dates
1528	is eligible to elect to participate in DROP after attaining
1529	normal retirement date in either class.
1530	3.  The employer of a member electing to participate in
1531	DROP, or employers if dually employed, shall acknowledge in
1532	writing to the division the date the member's participation in
1533	DROP begins and the date the member's employment and DROP
1534	participation will terminate.
1535	4.  Simultaneous employment of a participant by additional
1536	Florida Retirement System employers subsequent to the
1537	commencement of participation in DROP is permissible if such
1538	employers acknowledge in writing a DROP termination date no
1539	later than the participant's existing termination date or the
1540	maximum participation period provided in subparagraph (b)1.
1541	5.  A DROP participant may change employers while
1542	participating in DROP, subject to the following:
1543	a.  A change of employment must take place without a break
1544	in service so that the member receives salary for each month of
1545	continuous DROP participation. If a member receives no salary
1546	during a month, DROP participation shall cease unless the
1547	employer verifies a continuation of the employment relationship
1548	for such participant pursuant to s. 121.021(39)(b).
1549	b.  Such participant and new employer shall notify the
1550	division of the identity of the new employer on forms required
1551	by the division.
1552	c.  The new employer shall acknowledge, in writing, the
1553	participant's DROP termination date, which may be extended but
1554	not beyond the maximum participation period provided in
1555	subparagraph (b)1., shall acknowledge liability for any
1556	additional retirement contributions and interest required if the
1557	participant fails to timely terminate employment, and is subject
1558	to the adjustment required in sub-subparagraph (c)5.d.
1559	6.  Effective July 1, 2001, for instructional personnel as
1560	defined in s. 1012.01(2), election to participate in DROP may be
1561	made at any time following the date on which the member first
1562	reaches normal retirement date. The member shall advise his or
1563	her employer and the division in writing of the date on which
1564	DROP begins. When establishing eligibility of the member to
1565	participate in DROP for the 60-month participation period
1566	provided in subparagraph (b)1., the member may elect to include
1567	or exclude any optional service credit purchased by the member
1568	from the total service used to establish the normal retirement
1569	date. A member who has dual normal retirement dates is eligible
1570	to elect to participate in either class.
1571	(b)  Participation in DROP.-
1572	1.  An eligible member may elect to participate in DROP for
1573	a period not to exceed a maximum of 60 calendar months. However,
1574	members who are instructional personnel employed by the Florida
1575	School for the Deaf and the Blind and authorized by the Board of
1576	Trustees of the Florida School for the Deaf and the Blind, who
1577	are instructional personnel as defined in s. 1012.01(2)(a)-(d)
1578	in grades K-12 and authorized by the district school
1579	superintendent, or who are instructional personnel as defined in
1580	s. 1012.01(2)(a) employed by a developmental research school and
1581	authorized by the school's director, or if the school has no
1582	director, by the school's principal, may participate in DROP for
1583	up to 36 calendar months beyond the 60-month period.
1584	2.  Upon deciding to participate in DROP, the member shall
1585	submit, on forms required by the division:
1586	a.  A written election to participate in DROP;
1587	b.  Selection of DROP participation and termination dates
1588	that satisfy the limitations stated in paragraph (a) and
1589	subparagraph 1. The termination date must be in a binding letter
1590	of resignation to the employer establishing a deferred
1591	termination date. The member may change the termination date
1592	within the limitations of subparagraph 1., but only with the
1593	written approval of the employer;
1594	c.  A properly completed DROP application for service
1595	retirement as provided in this section; and
1596	d.  Any other information required by the division.
1597	3.  The DROP participant is a retiree under the Florida
1598	Retirement System for all purposes, except for paragraph (5)(f)
1599	and subsection (9) and ss. 112.3173, 112.363, 121.053, and
1600	121.122. DROP participation is final and may not be canceled by
1601	the participant after the first payment is credited during the
1602	DROP participation period. However, participation in DROP does
1603	not alter the participant's employment status, and the member is
1604	not deemed retired from employment until his or her deferred
1605	resignation is effective and termination occurs as defined in s.
1606	121.021.
1607	4.  Elected officers are eligible to participate in DROP
1608	subject to the following:
1609	a.  An elected officer who reaches normal retirement date
1610	during a term of office may defer the election to participate
1611	until the next succeeding term in that office. An elected
1612	officer who exercises this option may participate in DROP for up
1613	to 60 calendar months or no longer than the succeeding term of
1614	office, whichever is less.
1615	b.  An elected or a nonelected participant may run for a
1616	term of office while participating in DROP and, if elected,
1617	extend the DROP termination date accordingly; however, if such
1618	additional term of office exceeds the 60-month limitation
1619	established in subparagraph 1., and the officer does not resign
1620	from office within such 60-month limitation, the retirement and
1621	the participant's DROP is null and void as provided in sub-
1622	subparagraph (c)5.d.
1623	c.  An elected officer who is dually employed and elects to
1624	participate in DROP must terminate all employment relationships
1625	as provided in s. 121.021(39) for the nonelected position within
1626	the original 60-month period or maximum participation period as
1627	provided in subparagraph 1. For DROP participation ending:
1628	(I)  Before July 1, 2010, the officer may continue
1629	employment as an elected officer as provided in s. 121.053. The
1630	elected officer shall be enrolled as a renewed member in the
1631	Elected Officers' Class or the Regular Class, as provided in ss.
1632	121.053 and 121.122, on the first day of the month after
1633	termination of employment in the nonelected position and
1634	termination of DROP. Distribution of the DROP benefits shall be
1635	made as provided in paragraph (c).
1636	(II)  On or after July 1, 2010, the officer may continue
1637	employment as an elected officer but must defer termination as
1638	provided in s. 121.053.
1639	(c)  Benefits payable under DROP.-
1640	1.  Effective on the date of DROP participation, the
1641	member's initial normal monthly benefit, including creditable
1642	service, optional form of payment, and average final
1643	compensation, and the effective date of retirement are fixed.
1644	The beneficiary established under the Florida Retirement System
1645	is the beneficiary eligible to receive any DROP benefits payable
1646	if the DROP participant dies before completing the period of
1647	DROP participation. If a joint annuitant predeceases the member,
1648	the member may name a beneficiary to receive accumulated DROP
1649	benefits payable. The retirement benefit, the annual cost of
1650	living adjustments provided in s. 121.101, and interest accrue
1651	monthly in the Florida Retirement System Trust Fund. The
1652	interest accrues at an effective annual rate of 6.5 percent
1653	compounded monthly, on the prior month's accumulated ending
1654	balance, up to the month of termination or death, except as
1655	provided in s. 121.053(7).
1656	2.  Each employee who elects to participate in DROP may
1657	elect to receive a lump-sum payment for accrued annual leave
1658	earned in accordance with agency policy upon beginning
1659	participation in DROP. The accumulated leave payment certified
1660	to the division upon commencement of DROP shall be included in
1661	the calculation of the member's average final compensation. The
1662	employee electing the lump-sum payment is not eligible to
1663	receive a second lump-sum payment upon termination, except to
1664	the extent the employee has earned additional annual leave
1665	which, combined with the original payment, does not exceed the
1666	maximum lump-sum payment allowed by the employing agency's
1667	policy or rules. An early lump-sum payment shall be based on the
1668	hourly wage of the employee at the time he or she begins
1669	participation in DROP. If the member elects to wait and receive
1670	a lump-sum payment upon termination of DROP and termination of
1671	employment with the employer, any accumulated leave payment made
1672	at that time may not be included in the member's retirement
1673	benefit, which was determined and fixed by law when the employee
1674	elected to participate in DROP.
1675	3.  The effective date of DROP participation and the
1676	effective date of retirement of a DROP participant shall be the
1677	first day of the month selected by the member to begin
1678	participation in DROP, provided such date is properly
1679	established, with the written confirmation of the employer, and
1680	the approval of the division, on forms required by the division.
1681	4.  Normal retirement benefits and any interest shall
1682	continue to accrue in DROP until the established termination
1683	date of DROP or until the participant terminates employment or
1684	dies prior to such date, except as provided in s. 121.053(7).
1685	Although individual DROP accounts shall not be established, a
1686	separate accounting of each participant's accrued benefits under
1687	DROP shall be calculated and provided to participants.
1688	5.  At the conclusion of the participant's DROP, the
1689	division shall distribute the participant's total accumulated
1690	DROP benefits, subject to the following:
1691	a.  The division shall receive verification by the
1692	participant's employer or employers that the participant has
1693	terminated all employment relationships as provided in s.
1694	121.021(39).
1695	b.  The terminated DROP participant or, if deceased, the
1696	participant's named beneficiary, shall elect on forms provided
1697	by the division to receive payment of the DROP benefits in
1698	accordance with one of the options listed below. If a
1699	participant or beneficiary fails to elect a method of payment
1700	within 60 days after termination of DROP, the division shall pay
1701	a lump sum as provided in sub-sub-subparagraph (I).
1702	(I)  Lump sum.-All accrued DROP benefits, plus interest,
1703	less withholding taxes remitted to the Internal Revenue Service,
1704	shall be paid to the DROP participant or surviving beneficiary.
1705	(II)  Direct rollover.-All accrued DROP benefits, plus
1706	interest, shall be paid from DROP directly to the custodian of
1707	an eligible retirement plan as defined in s. 402(c)(8)(B) of the
1708	Internal Revenue Code. However, in the case of an eligible
1709	rollover distribution to the surviving spouse of a deceased
1710	participant, an eligible retirement plan is an individual
1711	retirement account or an individual retirement annuity as
1712	described in s. 402(c)(9) of the Internal Revenue Code.
1713	(III)  Partial lump sum.-A portion of the accrued DROP
1714	benefits shall be paid to DROP participant or surviving spouse,
1715	less withholding taxes remitted to the Internal Revenue Service,
1716	and the remaining DROP benefits must be transferred directly to
1717	the custodian of an eligible retirement plan as defined in s.
1718	402(c)(8)(B) of the Internal Revenue Code. However, in the case
1719	of an eligible rollover distribution to the surviving spouse of
1720	a deceased participant, an eligible retirement plan is an
1721	individual retirement account or an individual retirement
1722	annuity as described in s. 402(c)(9) of the Internal Revenue
1723	Code. The proportions must be specified by the DROP participant
1724	or surviving beneficiary.
1725	c.  The form of payment selected by the DROP participant or
1726	surviving beneficiary must comply with the minimum distribution
1727	requirements of the Internal Revenue Code.
1728	d.  A DROP participant who fails to terminate all
1729	employment relationships as provided in s. 121.021(39) shall be
1730	deemed as not retired, and the DROP election is null and void.
1731	Florida Retirement System membership shall be reestablished
1732	retroactively to the date of the commencement of DROP, and each
1733	employer with whom the participant continues employment must pay
1734	to the Florida Retirement System Trust Fund the difference
1735	between the DROP contributions paid in paragraph (i) and the
1736	contributions required for the applicable Florida Retirement
1737	System class of membership during the period the member
1738	participated in DROP, plus 6.5 percent interest compounded
1739	annually.
1740	6.  The retirement benefits of any DROP participant who
1741	terminates all employment relationships as provided in s.
1742	121.021(39) but is reemployed in violation of the reemployment
1743	provisions of subsection (9) shall be suspended during those
1744	months in which the retiree is in violation. Any retiree in
1745	violation of this subparagraph and any employer that employs or
1746	appoints such person without notifying the Division of
1747	Retirement to suspend retirement benefits are jointly and
1748	severally liable for any benefits paid during the reemployment
1749	limitation period. The employer must have a written statement
1750	from the retiree that he or she is not retired from a state-
1751	administered retirement system. Any retirement benefits received
1752	by a retiree while employed in violation of the reemployment
1753	limitations must be repaid to the Florida Retirement System
1754	Trust Fund, and his or her retirement benefits shall remain
1755	suspended until payment is made. Benefits suspended beyond the
1756	end of the reemployment limitation period apply toward repayment
1757	of benefits received in violation of the reemployment
1758	limitation.
1759	7.  The accrued benefits of any DROP participant, and any
1760	contributions accumulated under the program, are not subject to
1761	assignment, execution, attachment, or any legal process
1762	whatsoever, except for qualified domestic relations orders by a
1763	court of competent jurisdiction, income deduction orders as
1764	provided in s. 61.1301, and federal income tax levies.
1765	8.  DROP participants are not eligible for disability
1766	retirement benefits as provided in subsection (4).
1767	(d)  Death benefits under DROP.-
1768	1.  Upon the death of a DROP participant, the named
1769	beneficiary is entitled to apply for and receive the accrued
1770	benefits in DROP as provided in sub-subparagraph (c)5.b.
1771	2.  The normal retirement benefit accrued to DROP during
1772	the month of a participant's death is the final monthly benefit
1773	credited for such DROP participant.
1774	3.  Eligibility to participate in DROP terminates upon
1775	death of the participant. If the participant dies on or after
1776	the effective date of enrollment in DROP, but before the first
1777	monthly benefit is credited to DROP, Florida Retirement System
1778	benefits are paid in accordance with subparagraph (7)(c)1. or
1779	subparagraph 2.
1780	4.  A DROP participant's survivors are not eligible to
1781	receive Florida Retirement System death benefits as provided in
1782	paragraph (7)(d).
1783	(e)  Cost-of-living adjustment.-On each July 1, the
1784	participant's normal retirement benefit shall be increased as
1785	provided in s. 121.101.
1786	(f)  Retiree health insurance subsidy.-DROP participants
1787	are not eligible to apply for the retiree health insurance
1788	subsidy payments as provided in s. 112.363 until such
1789	participants have terminated employment and participation in
1790	DROP.
1791	(g)  Renewed membership.-DROP participants are not eligible
1792	for renewed membership in the Florida Retirement System under
1793	ss. 121.053 and 121.122 until all employment relationships are
1794	terminated as provided in s. 121.021(39).
1795	(h)  Employment limitation after DROP participation.-Upon
1796	termination as defined in s. 121.021, DROP participants are
1797	subject to the same reemployment limitations as other retirees.
1798	Reemployment restrictions applicable to retirees as provided in
1799	subsection (9) do not apply to DROP participants until their
1800	employment and participation in DROP are terminated.
1801	(i)  Contributions.-
1802	1.  All employers paying the salary of a DROP participant
1803	filling a regularly established position shall contribute 8.0
1804	percent of such participant's gross compensation for the period
1805	of July 1, 2002, through June 30, 2003, and the percentage of
1806	such compensation required by s. 121.71 thereafter, which shall
1807	constitute the entire employer DROP contribution with respect to
1808	such participant. Such contributions, payable to the Florida
1809	Retirement System Trust Fund in the same manner as required in
1810	s. 121.071, must be made as appropriate for each pay period and
1811	are in addition to contributions required for social security
1812	and the Retiree Health Insurance Subsidy Trust Fund. Such
1813	employer, social security, and health insurance subsidy
1814	contributions are not included in DROP.
1815	2.  The employer shall, in addition to subparagraph 1.,
1816	also withhold one-half of the entire social security
1817	contribution required for the participant. Contributions for
1818	social security by each participant and each employer, in the
1819	amount required for social security coverage as provided by the
1820	federal Social Security Act, are in addition to contributions
1821	specified in subparagraph 1.
1822	3.  All employers paying the salary of a DROP participant
1823	filling a regularly established position shall contribute the
1824	percent of such participant's gross compensation required in s.
1825	121.071(4), which constitutes the employer's health insurance
1826	subsidy contribution with respect to such participant. Such
1827	contributions must be deposited by the administrator in the
1828	Retiree Health Insurance Subsidy Trust Fund.
1829	(j)  Forfeiture of retirement benefits.-This section does
1830	not remove DROP participants from the scope of s. 8(d), Art. II
1831	of the State Constitution, s. 112.3173, and paragraph (5)(f).
1832	DROP participants who commit a specified felony offense while
1833	employed are subject to forfeiture of all retirement benefits,
1834	including DROP benefits, pursuant to those provisions of law.
1835	(k)  Administration of program.-The division shall adopt
1836	rules as necessary for the effective and efficient
1837	administration of this subsection. The division is not required
1838	to advise members of the federal tax consequences of an election
1839	related to the DROP but may advise members to seek independent
1840	advice.
1841	(14)  PAYMENT OF BENEFITS.-This subsection applies to the
1842	payment of benefits to a payee (retiree or beneficiary) under
1843	the Florida Retirement System:
1844	(a)  Federal income tax shall be withheld in accordance
1845	with federal law, unless the payee elects otherwise on Form W-
1846	4P. The division shall prepare and distribute to each recipient
1847	of monthly retirement benefits an appropriate income tax form
1848	that reflects the recipient's income and federal income tax
1849	withheld for the calendar year just ended.
1850	(b)  Subject to approval by the division in accordance with
1851	rule 60S-4.015, Florida Administrative Code, a payee receiving
1852	retirement benefits under the system may also have the following
1853	payments deducted from his or her monthly benefit:
1854	1.  Premiums for life and health-related insurance policies
1855	from approved companies.
1856	2.  Life insurance premiums for the State Group Life
1857	Insurance Plan, if authorized in writing by the payee and by the
1858	department.
1859	3.  Repayment of overpayments from the Florida Retirement
1860	System Trust Fund, the State Employees' Health Insurance Trust
1861	Fund, or the State Employees' Life Insurance Trust Fund, upon
1862	notification of the payee.
1863	4.  Payments to an alternate payee for alimony or child
1864	support pursuant to an income deduction order under s. 61.1301,
1865	or division of marital assets pursuant to a qualified domestic
1866	relations order under s. 222.21.
1867	5.  Payments to the Internal Revenue Service for federal
1868	income tax levies, upon notification of the division by the
1869	Internal Revenue Service.
1870	(c)  A payee must notify the division of any change in his
1871	or her address. The division may suspend benefit payments to a
1872	payee if correspondence sent to the payee's mailing address is
1873	returned due to an incorrect address. Benefit payments shall be
1874	resumed upon notification to the division of the payee's new
1875	address.
1876	(d)  A payee whose retirement benefits are reduced by the
1877	application of maximum benefit limits under s. 415(b) of the
1878	Internal Revenue Code, as specified in s. 121.30(5), shall have
1879	the portion of his or her calculated benefit in the Florida
1880	Retirement System defined benefit plan which exceeds such
1881	federal limitation paid through the Florida Retirement System
1882	Preservation of Benefits Plan, as provided in s. 121.1001.
1883	(e)  The Division of Retirement may issue retirement
1884	benefits payable for division of marital assets pursuant to a
1885	qualified domestic relations order directly to the alternate
1886	payee, any court order to the contrary notwithstanding, in order
1887	to meet Internal Revenue Code requirements.
1888	(f)  A benefit may not be reduced for the purpose of
1889	preserving the member's eligibility for a federal program.
1890	(g)  The division shall adopt rules establishing procedures
1891	for determining that persons to whom benefits are being paid are
1892	still living. The division shall suspend the benefits being paid
1893	to any payee if it is unable to contact such payee and to
1894	confirm that he or she is still living.
1895	Section 9.  Paragraphs (g) and (i) of subsection (3) of
1896	section 121.35, Florida Statutes, are amended to read:
1897	121.35  Optional retirement program for the State
1898	University System.-
1899	(3)  ELECTION OF OPTIONAL PROGRAM.-
1900	(g)  An eligible employee who is a member of the Florida
1901	Retirement System at the time of election to participate in the
1902	optional retirement program shall retain all retirement service
1903	credit earned under the Florida Retirement System, at the rate
1904	earned. No Additional service credit in the Florida Retirement
1905	System may not shall be earned while the employee participates
1906	in the optional program, and nor shall the employee is not be
1907	eligible for disability retirement under the Florida Retirement
1908	System. An eligible employee may transfer from the Florida
1909	Retirement System to his or her accounts under the State
1910	University System Optional Retirement Program a sum representing
1911	the present value of the employee's accumulated benefit
1912	obligation under the defined benefit program of the Florida
1913	Retirement System for any service credit accrued from the
1914	employee's first eligible transfer date to the optional
1915	retirement program through the actual date of such transfer, if
1916	such service credit was earned in the period from July 1, 1984,
1917	through December 31, 1992. The present value of the employee's
1918	accumulated benefit obligation must shall be calculated as
1919	described in s. 121.4501(3) s. 121.4501(3)(c)2. Upon such
1920	transfer, all such service credit previously earned under the
1921	defined benefit program of the Florida Retirement System during
1922	this period is shall be nullified for purposes of entitlement to
1923	a future benefit under the defined benefit program of the
1924	Florida Retirement System.
1925	(i)  Effective January 1, 2008, through December 31, 2008,
1926	except for an employee who is a mandatory participant of the
1927	State University System Optional Retirement Program, an employee
1928	who has elected to participate in the State University System
1929	Optional Retirement Program shall have one opportunity, at the
1930	employee's discretion, to choose to transfer from this program
1931	to the defined benefit program of the Florida Retirement System
1932	or to the defined contribution Public Employee Optional
1933	Retirement program, subject to the terms of the applicable
1934	contracts of the State University System Optional Retirement
1935	Program.
1936	1.  If the employee chooses to move to the defined
1937	contribution Public Employee Optional Retirement program, any
1938	contributions, interest, and earnings creditable to the employee
1939	under the State University System Optional Retirement Program
1940	must shall be retained by the employee in the State University
1941	System Optional Retirement Program, and the applicable
1942	provisions of s. 121.4501(4) shall govern the election.
1943	2.  If the employee chooses to move to the defined benefit
1944	program of the Florida Retirement System, the employee shall
1945	receive service credit equal to his or her years of service
1946	under the State University System Optional Retirement Program.
1947	a.  The cost for such credit must be in shall be an amount
1948	representing the actuarial accrued liability for the affected
1949	period of service. The cost must shall be calculated using the
1950	discount rate and other relevant actuarial assumptions that were
1951	used to value the Florida Retirement System defined benefit plan
1952	liabilities in the most recent actuarial valuation. The
1953	calculation must shall include any service already maintained
1954	under the defined benefit program plan in addition to the years
1955	under the State University System Optional Retirement Program.
1956	The actuarial accrued liability of any service already
1957	maintained under the defined benefit program must plan shall be
1958	applied as a credit to total cost resulting from the
1959	calculation. The division shall ensure that the transfer sum is
1960	prepared using a formula and methodology certified by an
1961	enrolled actuary.
1962	b.  The employee must transfer from his or her State
1963	University System Optional Retirement Program account, and from
1964	other employee moneys as necessary, a sum representing the
1965	actuarial accrued liability immediately following the time of
1966	such movement, determined assuming that attained service equals
1967	the sum of service in the defined benefit program and service in
1968	the State University System Optional Retirement Program.
1969	Section 10.  Section 121.4501, Florida Statutes, is amended
1970	to read:
1971	121.4501  Public Employee Optional Retirement Investment
1972	Program.-
1973	(1)  The Trustees of the State Board of Administration
1974	shall establish a an optional defined contribution retirement
1975	program called the Public Employee Retirement Investment Program
1976	for members of the Florida Retirement System under which
1977	retirement benefits will be provided for eligible employees
1978	employed before January 1, 2011, who elect to participate in the
1979	program, and for all eligible employees employed on or after
1980	January 1, 2011. The retirement benefits to be provided for or
1981	on behalf of participants in such optional retirement program
1982	shall be provided through employee-directed investments, in
1983	accordance with s. 401(a) of the Internal Revenue Code and its
1984	related regulations. The employer employers shall make
1985	contributions contribute, as provided in this section and, ss.
1986	121.571, and 121.71, to the Public Employee Optional Retirement
1987	Investment Program Trust Fund toward the funding of such
1988	optional benefits.
1989	(2)  DEFINITIONS.-As used in this part, the term:
1990	(a)  "Approved provider" or "provider" means a private
1991	sector company that is selected and approved by the state board
1992	to offer one or more investment products or services to the
1993	investment Public Employee Optional Retirement program. The term
1994	includes a bundled provider that offers participants a range of
1995	individually allocated or unallocated investment products and
1996	may offer a range of administrative and customer services, which
1997	may include accounting and administration of individual
1998	participant benefits and contributions; individual participant
1999	recordkeeping; asset purchase, control, and safekeeping; direct
2000	execution of the participant's instructions as to asset and
2001	contribution allocation; calculation of daily net asset values;
2002	direct access to participant account information; periodic
2003	reporting to participants, at least quarterly, on account
2004	balances and transactions; guidance, advice, and allocation
2005	services directly relating to the provider's its own investment
2006	options or products, but only if the bundled provider complies
2007	with the standard of care of s. 404(a)(1)(A-B) of the Employee
2008	Retirement Income Security Act of 1974 (ERISA), and if providing
2009	such guidance, advice, or allocation services does not
2010	constitute a prohibited transaction under s. 4975(c)(1) of the
2011	Internal Revenue Code or s. 406 of ERISA, notwithstanding that
2012	such prohibited transaction provisions do not apply to the
2013	investment optional retirement program; a broad array of
2014	distribution options; asset allocation; and retirement
2015	counseling and education. Private sector companies include
2016	investment management companies, insurance companies,
2017	depositories, and mutual fund companies.
2018	(b)  "Average monthly compensation" means one-twelfth of
2019	average final compensation as defined in s. 121.021(24).
2020	(c)  "Covered employment" means employment in a regularly
2021	established position as defined in s. 121.021(52).
2022	(d)  "Defined benefit program" means the defined benefit
2023	program of the Florida Retirement System as administered under
2024	part I of this chapter.
2025	(e)(d)  "Department" means the Department of Management
2026	Services.
2027	(f)  "District school board employer" means a district
2028	school board that participates in the Florida Retirement System
2029	for the benefit of certain employees, or a charter school or
2030	charter technical career center that participates in the Florida
2031	Retirement System as provided under s. 121.051(2)(d).
2032	(g)(e)  "Division" means the Division of Retirement within
2033	the department of Management Services.
2034	(h)(f)  "Eligible employee" means an officer or employee,
2035	as defined in s. 121.021, who:
2036	1.  Is a member of, or is eligible for membership in, the
2037	Florida Retirement System, including any renewed member of the
2038	Florida Retirement System initially enrolled before July 1,
2039	2010; or
2040	2.  Participates in, or is eligible to participate in, the
2041	Senior Management Service Optional Annuity Program as
2042	established under s. 121.055(6), the State Community College
2043	System Optional Retirement Program as established under s.
2044	121.051(2)(c), or the State University System Optional
2045	Retirement Program established under s. 121.35.
2046
2047	The term does not include any member participating in the
2048	Deferred Retirement Option Program established under s.
2049	121.091(13), a retiree of a state-administered retirement system
2050	initially reemployed on or after July 1, 2010, or a mandatory
2051	participant of the State University System Optional Retirement
2052	Program established under s. 121.35.
2053	(i)(g)  "Employer" means an employer, as defined in s.
2054	121.021(10), of an eligible employee.
2055	(j)  "Investment program" means the Public Employee
2056	Retirement Investment Program established under this part.
2057	(k)  "Local employer" means an employer that is not a state
2058	employer or a district school board employer.
2059	(l)(h)  "Participant" means an eligible employee who is
2060	enrolled elects to participate in the investment program, Public
2061	Employee Optional Retirement program and enrolls in such
2062	optional program as provided in subsection (4) or a terminated
2063	Deferred Retirement Option Program participant as described in
2064	subsection (21).
2065	(i)"  Public Employee Optional Retirement Program,"
2066	"optional program," or "optional retirement program" means the
2067	alternative defined contribution retirement program established
2068	under this section.
2069	(m)(j)  "Retiree" means a former participant of the
2070	investment Florida Retirement System Public Employee Optional
2071	Retirement program who has terminated employment and has taken a
2072	distribution as provided in s. 121.591, except for a mandatory
2073	distribution of a de minimis account authorized by the state
2074	board.
2075	(n)(k)  "State board" or "board" means the State Board of
2076	Administration.
2077	(l)  "Trustees" means Trustees of the State Board of
2078	Administration.
2079	(o)  "State employer" means an agency, board, branch,
2080	commission, community college, department, institution,
2081	institution of higher education, or water management district
2082	that participates in the Florida Retirement System for the
2083	benefit of certain employees.
2084	(p)(m)  "Vested" or "vesting" means the guarantee that a
2085	participant is eligible to receive a retirement benefit upon
2086	completion of the required years of service under the investment
2087	Public Employee Optional Retirement program.
2088	(3)  ELIGIBILITY; RETIREMENT SERVICE CREDIT; TRANSFER OF
2089	BENEFITS.-
2090	(a)  Participation in the Public Employee Optional
2091	Retirement Program is limited to eligible employees.
2092	Participation in the optional retirement program is in lieu of
2093	participation in the defined benefit program of the Florida
2094	Retirement System.
2095	(a)(b)  An eligible employee who is employed in a regularly
2096	established position by a state employer on June 1, 2002; by a
2097	district school board employer on September 1, 2002; or by a
2098	local employer on December 1, 2002, and who is a member of the
2099	defined benefit retirement program of the Florida Retirement
2100	System at the time of his or her election to participate in the
2101	investment Public Employee Optional Retirement program shall
2102	retain all retirement service credit earned under the defined
2103	benefit retirement program of the Florida Retirement System as
2104	credited under the system and is shall be entitled to a deferred
2105	benefit upon termination, if eligible under the system. However,
2106	election to participate in the investment Public Employee
2107	Optional Retirement program terminates the active membership of
2108	the employee in the defined benefit program of the Florida
2109	Retirement System, and the service of a participant in the
2110	investment Public Employee Optional Retirement program is shall
2111	not be creditable under the defined benefit retirement program
2112	of the Florida Retirement System for purposes of benefit accrual
2113	but is creditable shall be credited for purposes of vesting.
2114	(b)(c)1.  Notwithstanding paragraph (a), an (b), each
2115	eligible employee who elects to participate in the investment
2116	Public Employee Optional Retirement program and establishes one
2117	or more individual participant accounts under the optional
2118	program may elect to transfer to the investment optional program
2119	a sum representing the present value of the employee's
2120	accumulated benefit obligation under the defined benefit
2121	retirement program of the Florida Retirement System. Upon such
2122	transfer, all service credit previously earned under the defined
2123	benefit program is of the Florida Retirement System shall be
2124	nullified for purposes of entitlement to a future benefit under
2125	the defined benefit program of the Florida Retirement System. A
2126	participant may not transfer is precluded from transferring the
2127	accumulated benefit obligation balance from the defined benefit
2128	program after the time upon the expiration of the period for
2129	enrolling afforded to enroll in the investment optional program.
2130	1.2.  For purposes of this subsection, the present value of
2131	the member's accumulated benefit obligation is based upon the
2132	member's estimated creditable service and estimated average
2133	final compensation under the defined benefit program, subject to
2134	recomputation under subparagraph 2. 3. For state employees
2135	enrolling under subparagraph (4)(a)1., initial estimates shall
2136	will be based upon creditable service and average final
2137	compensation as of midnight on June 30, 2002; for district
2138	school board employees enrolling under subparagraph (4)(b)1.,
2139	initial estimates shall will be based upon creditable service
2140	and average final compensation as of midnight on September 30,
2141	2002; and for local government employees enrolling under
2142	subparagraph (4)(c)1., initial estimates shall will be based
2143	upon creditable service and average final compensation as of
2144	midnight on December 31, 2002. The dates respectively specified
2145	are above shall be construed as the "estimate date" for these
2146	employees. The actuarial present value of the employee's
2147	accumulated benefit obligation shall be based on the following:
2148	a.  The discount rate and other relevant actuarial
2149	assumptions used to value the Florida Retirement System Trust
2150	Fund at the time the amount to be transferred is determined,
2151	consistent with the factors provided in sub-subparagraphs b. and
2152	c.
2153	b.  A benefit commencement age, based on the member's
2154	estimated creditable service as of the estimate date. The
2155	benefit commencement age is shall be the younger of the
2156	following, but may shall not be younger than the member's age as
2157	of the estimate date:
2158	(I)  Age 62; or
2159	(II)  The age the member would attain if the member
2160	completed 30 years of service with an employer, assuming the
2161	member worked continuously from the estimate date, and
2162	disregarding any vesting requirement that would otherwise apply
2163	under the defined benefit program of the Florida Retirement
2164	System.
2165	c.  For members of the Special Risk Class, and for members
2166	of the Special Risk Administrative Support Class entitled to
2167	retain the special risk normal retirement date, the benefit
2168	commencement age is shall be the younger of the following, but
2169	may shall not be younger than the member's age as of the
2170	estimate date:
2171	(I)  Age 55; or
2172	(II)  The age the member would attain if the member
2173	completed 25 years of service with an employer, assuming the
2174	member worked continuously from the estimate date, and
2175	disregarding any vesting requirement that would otherwise apply
2176	under the defined benefit program of the Florida Retirement
2177	System.
2178	d.  The calculation must shall disregard vesting
2179	requirements and early retirement reduction factors that would
2180	otherwise apply under the defined benefit retirement program.
2181	2.3.  For each participant who elects to transfer moneys
2182	from the defined benefit program to his or her account in the
2183	investment optional program, the division shall recompute the
2184	amount transferred under subparagraph 1. within 2. not later
2185	than 60 days after the actual transfer of funds based upon the
2186	participant's actual creditable service and actual final average
2187	compensation as of the initial date of participation in the
2188	investment optional program. If the recomputed amount differs
2189	from the amount transferred under subparagraph 2. by $10 or
2190	more, the division shall:
2191	a.  Transfer, or cause to be transferred, from the Florida
2192	Retirement System Trust Fund to the participant's account in the
2193	optional program the excess, if any, of the recomputed amount
2194	over the previously transferred amount together with interest
2195	from the initial date of transfer to the date of transfer under
2196	this subparagraph, based upon the effective annual interest
2197	equal to the assumed return on the actuarial investment which
2198	was used in the most recent actuarial valuation of the system,
2199	compounded annually.
2200	b.  Transfer, or cause to be transferred, from the
2201	participant's account to the Florida Retirement System Trust
2202	Fund the excess, if any, of the previously transferred amount
2203	over the recomputed amount, together with interest from the
2204	initial date of transfer to the date of transfer under this
2205	subparagraph, based upon 6 percent effective annual interest,
2206	compounded annually, pro rata based on the participant's
2207	allocation plan.
2208	3.4.  As directed by the participant, the state board shall
2209	transfer or cause to be transferred the appropriate amounts to
2210	the designated accounts within. The board shall establish
2211	transfer procedures by rule, but the actual transfer shall not
2212	be later than 30 days after the effective date of the member's
2213	participation in the investment optional program unless the
2214	major financial markets for securities available for a transfer
2215	are seriously disrupted by an unforeseen event that which also
2216	causes the suspension of trading on any national securities
2217	exchange in the country where the securities are were issued. In
2218	that event, the such 30-day period of time may be extended by a
2219	resolution of the state board trustees. The state board shall
2220	establish transfer procedures by rule. Transfers are not
2221	commissionable or subject to other fees and may be in the form
2222	of securities or cash, as determined by the state board. Such
2223	securities are shall be valued as of the date of receipt in the
2224	participant's account.
2225	4.5.  If the state board or the division receives
2226	notification from the United States Internal Revenue Service
2227	that this paragraph or any portion of this paragraph will cause
2228	the retirement system, or a portion thereof, to be disqualified
2229	for tax purposes under the Internal Revenue Code, then the
2230	portion that will cause the disqualification does not apply.
2231	Upon such notice, the state board and the division shall notify
2232	the presiding officers of the Legislature.
2233	(4)  OPTIONAL PARTICIPATION; ENROLLMENT.-
2234	(a)1.  With respect to an eligible employee who is employed
2235	in a regularly established position by a state employer after on
2236	June 1, 2002; by a district school board employer after
2237	September 1, 2002; or by a local employer after December 1,
2238	2002, but before January 1, 2011, the, by a state employer:
2239	a.  Any such employee may elect to participate in the
2240	Public Employee Optional Retirement Program in lieu of retaining
2241	his or her membership in the defined benefit program of the
2242	Florida Retirement System. The election must be made in writing
2243	or by electronic means and must be filed with the third-party
2244	administrator by August 31, 2002, or, in the case of an active
2245	employee who is on a leave of absence on April 1, 2002, by the
2246	last business day of the 5th month following the month the leave
2247	of absence concludes. This election is irrevocable, except as
2248	provided in paragraph (e). Upon making such election, the
2249	employee shall be enrolled as a participant of the Public
2250	Employee Optional Retirement Program, the employee's membership
2251	in the Florida Retirement System shall be governed by the
2252	provisions of this part, and the employee's membership in the
2253	defined benefit program of the Florida Retirement System shall
2254	terminate. The employee's enrollment in the Public Employee
2255	Optional Retirement Program shall be effective the first day of
2256	the month for which a full month's employer contribution is made
2257	to the optional program.
2258	b.  Any such employee who fails to elect to participate in
2259	the Public Employee Optional Retirement Program within the
2260	prescribed time period is deemed to have elected to retain
2261	membership in the defined benefit program of the Florida
2262	Retirement System, and the employee's option to elect to
2263	participate in the optional program is forfeited.
2264	2.  With respect to employees who become eligible to
2265	participate in the Public Employee Optional Retirement Program
2266	by reason of employment in a regularly established position with
2267	a state employer commencing after April 1, 2002:
2268	a.  Any such employee shall, by default, be enrolled in the
2269	defined benefit retirement program of the Florida Retirement
2270	System at the commencement of employment, and may, by the last
2271	business day of the 5th month following the employee's month of
2272	hire, elect to participate in the investment Public Employee
2273	Optional Retirement program. The employee's election must be
2274	made in writing or by electronic means and must be filed with
2275	the third-party administrator. The election to participate in
2276	the investment optional program is irrevocable, except as
2277	provided in paragraph (c) (e).
2278	1.b.  If the employee files such election within the
2279	prescribed time period, enrollment in the investment optional
2280	program is shall be effective on the first day of employment.
2281	The employer retirement contributions paid through the month of
2282	the employee plan change shall be transferred to the investment
2283	optional program, and, effective the first day of the next
2284	month, the employer must shall pay the applicable contributions
2285	based on the employee membership class in the investment
2286	optional program.
2287	2.c.  An Any such employee who fails to elect to
2288	participate in the investment Public Employee Optional
2289	Retirement program within the prescribed time period is deemed
2290	to have elected to retain membership in the defined benefit
2291	program of the Florida Retirement System, and the employee's
2292	option to elect to participate in the investment optional
2293	program is forfeited.
2294	3.  With respect to employees who become eligible to
2295	participate in the Public Employee Optional Retirement
2296	Investment Program pursuant to s. 121.051(2)(c)3. or s.
2297	121.35(3)(i), the any such employee may elect to participate in
2298	the investment Public Employee Optional Retirement program in
2299	lieu of retaining his or her participation in the State
2300	Community College System Optional Retirement Program or the
2301	State University System Optional Retirement Program. The
2302	election must be made in writing or by electronic means and must
2303	be filed with the third-party administrator. This election is
2304	irrevocable, except as provided in paragraph (c) (e). Upon
2305	making such election, the employee shall be enrolled as a
2306	participant in of the investment Public Employee Optional
2307	Retirement program, the employee's membership in the Florida
2308	Retirement System shall be governed by the provisions of this
2309	part, and the employee's participation in the State Community
2310	College System Optional Retirement Program or the State
2311	University System Optional Retirement Program shall terminate.
2312	The employee's enrollment in the investment Public Employee
2313	Optional Retirement program is shall be effective on the first
2314	day of the month for which a full month's employer contribution
2315	is made to the investment optional program.
2316	4.  For purposes of this paragraph, "state employer" means
2317	any agency, board, branch, commission, community college,
2318	department, institution, institution of higher education, or
2319	water management district of the state, which participates in
2320	the Florida Retirement System for the benefit of certain
2321	employees.
2322	(b)1.  With respect to an eligible employee who is employed
2323	in a regularly established position on September 1, 2002, by a
2324	district school board employer:
2325	a.  Any such employee may elect to participate in the
2326	Public Employee Optional Retirement Program in lieu of retaining
2327	his or her membership in the defined benefit program of the
2328	Florida Retirement System. The election must be made in writing
2329	or by electronic means and must be filed with the third-party
2330	administrator by November 30, or, in the case of an active
2331	employee who is on a leave of absence on July 1, 2002, by the
2332	last business day of the 5th month following the month the leave
2333	of absence concludes. This election is irrevocable, except as
2334	provided in paragraph (e). Upon making such election, the
2335	employee shall be enrolled as a participant of the Public
2336	Employee Optional Retirement Program, the employee's membership
2337	in the Florida Retirement System shall be governed by the
2338	provisions of this part, and the employee's membership in the
2339	defined benefit program of the Florida Retirement System shall
2340	terminate. The employee's enrollment in the Public Employee
2341	Optional Retirement Program shall be effective the first day of
2342	the month for which a full month's employer contribution is made
2343	to the optional program.
2344	b.  Any such employee who fails to elect to participate in
2345	the Public Employee Optional Retirement Program within the
2346	prescribed time period is deemed to have elected to retain
2347	membership in the defined benefit program of the Florida
2348	Retirement System, and the employee's option to elect to
2349	participate in the optional program is forfeited.
2350	2.  With respect to employees who become eligible to
2351	participate in the Public Employee Optional Retirement Program
2352	by reason of employment in a regularly established position with
2353	a district school board employer commencing after July 1, 2002:
2354	a.  Any such employee shall, by default, be enrolled in the
2355	defined benefit retirement program of the Florida Retirement
2356	System at the commencement of employment, and may, by the last
2357	business day of the 5th month following the employee's month of
2358	hire, elect to participate in the Public Employee Optional
2359	Retirement Program. The employee's election must be made in
2360	writing or by electronic means and must be filed with the third-
2361	party administrator. The election to participate in the optional
2362	program is irrevocable, except as provided in paragraph (e).
2363	b.  If the employee files such election within the
2364	prescribed time period, enrollment in the optional program shall
2365	be effective on the first day of employment. The employer
2366	retirement contributions paid through the month of the employee
2367	plan change shall be transferred to the optional program, and,
2368	effective the first day of the next month, the employer shall
2369	pay the applicable contributions based on the employee
2370	membership class in the optional program.
2371	c.  Any such employee who fails to elect to participate in
2372	the Public Employee Optional Retirement Program within the
2373	prescribed time period is deemed to have elected to retain
2374	membership in the defined benefit program of the Florida
2375	Retirement System, and the employee's option to elect to
2376	participate in the optional program is forfeited.
2377	3.  For purposes of this paragraph, "district school board
2378	employer" means any district school board that participates in
2379	the Florida Retirement System for the benefit of certain
2380	employees, or a charter school or charter technical career
2381	center that participates in the Florida Retirement System as
2382	provided in s. 121.051(2)(d).
2383	(c)1.  With respect to an eligible employee who is employed
2384	in a regularly established position on December 1, 2002, by a
2385	local employer:
2386	a.  Any such employee may elect to participate in the
2387	Public Employee Optional Retirement Program in lieu of retaining
2388	his or her membership in the defined benefit program of the
2389	Florida Retirement System. The election must be made in writing
2390	or by electronic means and must be filed with the third-party
2391	administrator by February 28, 2003, or, in the case of an active
2392	employee who is on a leave of absence on October 1, 2002, by the
2393	last business day of the 5th month following the month the leave
2394	of absence concludes. This election is irrevocable, except as
2395	provided in paragraph (e). Upon making such election, the
2396	employee shall be enrolled as a participant of the Public
2397	Employee Optional Retirement Program, the employee's membership
2398	in the Florida Retirement System shall be governed by the
2399	provisions of this part, and the employee's membership in the
2400	defined benefit program of the Florida Retirement System shall
2401	terminate. The employee's enrollment in the Public Employee
2402	Optional Retirement Program shall be effective the first day of
2403	the month for which a full month's employer contribution is made
2404	to the optional program.
2405	b.  Any such employee who fails to elect to participate in
2406	the Public Employee Optional Retirement Program within the
2407	prescribed time period is deemed to have elected to retain
2408	membership in the defined benefit program of the Florida
2409	Retirement System, and the employee's option to elect to
2410	participate in the optional program is forfeited.
2411	2.  With respect to employees who become eligible to
2412	participate in the Public Employee Optional Retirement Program
2413	by reason of employment in a regularly established position with
2414	a local employer commencing after October 1, 2002:
2415	a.  Any such employee shall, by default, be enrolled in the
2416	defined benefit retirement program of the Florida Retirement
2417	System at the commencement of employment, and may, by the last
2418	business day of the 5th month following the employee's month of
2419	hire, elect to participate in the Public Employee Optional
2420	Retirement Program. The employee's election must be made in
2421	writing or by electronic means and must be filed with the third-
2422	party administrator. The election to participate in the optional
2423	program is irrevocable, except as provided in paragraph (e).
2424	b.  If the employee files such election within the
2425	prescribed time period, enrollment in the optional program shall
2426	be effective on the first day of employment. The employer
2427	retirement contributions paid through the month of the employee
2428	plan change shall be transferred to the optional program, and,
2429	effective the first day of the next month, the employer shall
2430	pay the applicable contributions based on the employee
2431	membership class in the optional program.
2432	c.  Any such employee who fails to elect to participate in
2433	the Public Employee Optional Retirement Program within the
2434	prescribed time period is deemed to have elected to retain
2435	membership in the defined benefit program of the Florida
2436	Retirement System, and the employee's option to elect to
2437	participate in the optional program is forfeited.
2438	3.  For purposes of this paragraph, "local employer" means
2439	any employer not included in paragraph (a) or paragraph (b).
2440	(b)(d)  Contributions available for self-direction by a
2441	participant who has not selected one or more specific investment
2442	products shall be allocated as prescribed by the state board.
2443	The third-party administrator shall notify the any such
2444	participant at least quarterly that the participant should take
2445	an affirmative action to make an asset allocation among the
2446	optional program products.
2447	(c)(e)  After the period during which an eligible employee
2448	had the choice to elect the defined benefit program or the
2449	investment Public Employee Optional Retirement program, or the
2450	month following the receipt of the eligible employee's plan
2451	election, if sooner, the employee shall have one opportunity, at
2452	the employee's discretion, to choose to move from the defined
2453	benefit program to the investment Public Employee Optional
2454	Retirement program or from the investment Public Employee
2455	Optional Retirement program to the defined benefit program.
2456	Eligible employees may elect to move between Florida Retirement
2457	System programs only if they are earning service credit in an
2458	employer-employee relationship consistent with the requirements
2459	under s. 121.021(17)(b), excluding leaves of absence without
2460	pay. Effective July 1, 2005, such elections are shall be
2461	effective on the first day of the month following the receipt of
2462	the election by the third-party administrator and are not
2463	subject to the requirements regarding an employer-employee
2464	relationship or receipt of contributions for the eligible
2465	employee in the effective month, except that the employee must
2466	meet the conditions of the previous sentence when the election
2467	is received by the third-party administrator. This paragraph is
2468	shall be contingent upon approval by from the Internal Revenue
2469	Service for including the choice described herein within the
2470	programs offered by the Florida Retirement System.
2471	1.  If the employee chooses to move to the investment
2472	Public Employee Optional Retirement program, the applicable
2473	provisions of subsection (3) this section shall govern the
2474	transfer.
2475	2.  If the employee chooses to move to the defined benefit
2476	program, the employee must transfer from his or her investment
2477	Public Employee Optional Retirement program account, and from
2478	other employee moneys as necessary, a sum representing the
2479	present value of that employee's accumulated benefit obligation
2480	immediately following the time of such movement, determined
2481	assuming that attained service equals the sum of service in the
2482	defined benefit program and service in the investment Public
2483	Employee Optional Retirement program. Benefit commencement
2484	occurs on the first date the employee is would become eligible
2485	for unreduced benefits, using the discount rate and other
2486	relevant actuarial assumptions that were used to value the
2487	Florida Retirement System defined benefit program plan
2488	liabilities in the most recent actuarial valuation. For any
2489	employee who, at the time of the second election, already
2490	maintains an accrued benefit amount in the defined benefit
2491	program plan, the then-present value of the such accrued benefit
2492	shall be deemed part of the required transfer amount described
2493	in this subparagraph. The division shall ensure that the
2494	transfer sum is prepared using a formula and methodology
2495	certified by an enrolled actuary.
2496	3.  Notwithstanding subparagraph 2., an employee who
2497	chooses to move to the defined benefit program and who became
2498	eligible to participate in the Public Employee Optional
2499	Retirement Program by reason of employment in a regularly
2500	established position with a state employer after June 1, 2002; a
2501	district school board employer after September 1, 2002; or a
2502	local employer after December 1, 2002, must transfer from his or
2503	her investment Public Employee Optional Retirement program
2504	account, and, from other employee moneys as necessary, a sum
2505	representing that employee's actuarial accrued liability.
2506	4.  An employee's Employees' ability to transfer from the
2507	Florida Retirement System defined benefit program to the
2508	investment Public Employee Optional Retirement program pursuant
2509	to paragraphs (a)-(c) (a)-(d), and the ability of a for current
2510	employee employees to have an option to later transfer back into
2511	the defined benefit program under subparagraph 2., shall be
2512	deemed a significant system amendment. Pursuant to s.
2513	121.031(4), any such resulting unfunded liability arising from
2514	actual original transfers from the defined benefit program to
2515	the investment optional program must shall be amortized within
2516	30 plan years as a separate unfunded actuarial base independent
2517	of the reserve stabilization mechanism defined in s.
2518	121.031(3)(f). For the first 25 years, a no direct amortization
2519	payment may not shall be calculated for this base. During this
2520	25-year period, the such separate base shall be used to offset
2521	the impact of employees exercising their second program election
2522	under this paragraph. It is the legislative intent of the
2523	Legislature that the actuarial funded status of the Florida
2524	Retirement System defined benefit program not be affected plan
2525	is neither beneficially nor adversely impacted by such second
2526	program elections in any significant manner, after due
2527	recognition of the separate unfunded actuarial base. Following
2528	this initial 25-year period, any remaining balance of the
2529	original separate base shall be amortized over the remaining 5
2530	years of the required 30-year amortization period.
2531	(5)  CONTRIBUTIONS.-
2532	(a)  Each employer shall contribute on behalf of each
2533	participant in the investment Public Employee Optional
2534	Retirement program, as provided in part III of this chapter. The
2535	state board, acting as plan fiduciary, shall ensure that all
2536	plan assets are held in a trust, pursuant to s. 401 of the
2537	Internal Revenue Code. The fiduciary shall ensure that said
2538	contributions are allocated as follows:
2539	1.  The portion earmarked for participant accounts shall be
2540	used to purchase interests in the appropriate investment
2541	vehicles for the accounts of each participant as specified by
2542	the participant, or in accordance with paragraph (4)(b) (4)(d).
2543	2.  The portion earmarked for administrative and
2544	educational expenses shall be transferred to the state board.
2545	3.  The portion earmarked for disability benefits shall be
2546	transferred to the department.
2547	(b)  Employers are responsible for notifying participants
2548	regarding maximum contribution levels allowed permitted under
2549	the Internal Revenue Code. If a participant contributes to any
2550	other tax-deferred plan, the participant he or she is
2551	responsible for ensuring that total contributions made to the
2552	investment optional program and to any other such plan do not
2553	exceed federally permitted maximums.
2554	(c)  The investment Public Employee Optional Retirement
2555	program may accept for deposit into participant accounts
2556	contributions in the form of rollovers or direct trustee-to-
2557	trustee transfers by or on behalf of participants, reasonably
2558	determined by the state board to be eligible for rollover or
2559	transfer to the investment optional retirement program pursuant
2560	to the Internal Revenue Code, if such contributions are made in
2561	accordance with rules as may be adopted by the state board. Such
2562	contributions must shall be accounted for in accordance with any
2563	applicable Internal Revenue Code requirements and rules of the
2564	state board.
2565	(6)  VESTING REQUIREMENTS.-
2566	(a)1.  With respect to employer contributions paid on
2567	behalf of the participant to the investment Public Employee
2568	Optional Retirement program, plus interest and earnings thereon
2569	and less investment fees and administrative charges, a
2570	participant is shall be vested after completing 1 work year, as
2571	defined in s. 121.021(54), with an employer, including any
2572	service while the participant was a member of the defined
2573	benefit retirement program or an optional retirement program
2574	authorized under s. 121.051(2)(c) or s. 121.055(6).
2575	2.  If the participant terminates employment before prior
2576	to satisfying the vesting requirements, the nonvested
2577	accumulation must shall be transferred from the participant's
2578	accounts to the state board for deposit and investment by the
2579	state board in its the suspense account in of the Public
2580	Employee Optional Retirement Investment Program Trust Fund of
2581	the board. If the terminated participant is reemployed as an
2582	eligible employee within 5 years, the state board shall transfer
2583	to the participant's account any amount of the moneys previously
2584	transferred from the participant's accounts to the suspense
2585	account, of the Public Employee Optional Retirement Program
2586	Trust Fund, plus the actual earnings on such amount while in the
2587	suspense account.
2588	(b)1.  With respect to amounts transferred from the defined
2589	benefit program to the investment program, plus interest and
2590	earnings, and less investment fees and administrative charges, a
2591	participant shall be vested in the amount transferred from the
2592	defined benefit program, plus interest and earnings thereon and
2593	less administrative charges and investment fees, upon meeting
2594	the service requirements for the participant's membership class
2595	as set forth in s. 121.021(29). The third-party administrator
2596	shall account for such amounts for each participant. The
2597	division shall notify the participant and the third-party
2598	administrator when the participant has satisfied the vesting
2599	period for Florida Retirement System purposes.
2600	2.  If the participant terminates employment before prior
2601	to satisfying the vesting requirements, the nonvested
2602	accumulation must shall be transferred from the participant's
2603	accounts to the state board for deposit and investment by the
2604	state board in the suspense account in of the Public Employee
2605	Optional Retirement Investment Program Trust Fund of the board.
2606	If the terminated participant is reemployed as an eligible
2607	employee within 5 years, the state board shall transfer to the
2608	participant's account any amount of the moneys previously
2609	transferred from the participant's accounts to the suspense
2610	account of the Public Employee Optional Retirement Program Trust
2611	Fund, plus the actual earnings on such amount while in the
2612	suspense account.
2613	(c)  Any nonvested accumulations transferred from a
2614	participant's account to the state board's suspense account
2615	shall be forfeited by the participant if the participant is not
2616	reemployed as an eligible employee within 5 years after
2617	termination.
2618	(7)  BENEFITS.-Under the Public Employee Optional
2619	Retirement Investment Program, benefits shall:
2620	(a)  Benefits shall Be provided in accordance with s.
2621	401(a) of the Internal Revenue Code.
2622	(b)  Benefits shall Accrue in individual accounts that are
2623	participant-directed, portable, and funded by employer
2624	contributions and earnings thereon.
2625	(c)  Benefits shall Be payable in accordance with the
2626	provisions of s. 121.591.
2627	(8)  PROGRAM ADMINISTRATION OF PROGRAM.-
2628	(a)  The Public Employee Optional Retirement Investment
2629	Program shall be administered by the state board and affected
2630	employers. The state board is authorized to require oaths, by
2631	affidavit or otherwise, and acknowledgments from persons in
2632	connection with the administration of its duties and
2633	responsibilities under the program this chapter. An No oath, by
2634	affidavit or otherwise, may not shall be required of an employee
2635	participant at the time of enrollment election. Acknowledgment
2636	of an employee's election to participate in the program shall be
2637	no greater than necessary to confirm the employee's election.
2638	The state board shall adopt rules establishing the roles role
2639	and responsibilities of affected state, local government, and
2640	education-related employers, the state board, the department,
2641	and third-party contractors in administering the investment
2642	Public Employee Optional Retirement program. The department
2643	shall adopt rules necessary to administer implement the
2644	investment optional program in coordination with the defined
2645	benefit retirement program and the disability benefits available
2646	under the investment optional program.
2647	(a)(b)1.  The state board shall select and contract with a
2648	one third-party administrator to provide administrative services
2649	if those services cannot be competitively and contractually
2650	provided by the division of Retirement within the Department of
2651	Management Services. With the approval of the state board, the
2652	third-party administrator may subcontract with other
2653	organizations or individuals to provide components of the
2654	administrative services. As a cost of administration, the state
2655	board may compensate any such contractor for its services, in
2656	accordance with the terms of the contract, as is deemed
2657	necessary or proper by the state board. The third-party
2658	administrator may not be an approved provider or be affiliated
2659	with an approved provider.
2660	2.  These administrative services may include, but are not
2661	limited to, enrollment of eligible employees, collection of
2662	employer contributions, disbursement of such contributions to
2663	approved providers in accordance with the allocation directions
2664	of participants; services relating to consolidated billing;
2665	individual and collective recordkeeping and accounting; asset
2666	purchase, control, and safekeeping; and direct disbursement of
2667	funds to and from the third-party administrator, the division,
2668	the state board, employers, participants, approved providers,
2669	and beneficiaries. This paragraph section does not prevent or
2670	prohibit a bundled provider from providing any administrative or
2671	customer service, including accounting and administration of
2672	individual participant benefits and contributions; individual
2673	participant recordkeeping; asset purchase, control, and
2674	safekeeping; direct execution of the participant's instructions
2675	as to asset and contribution allocation; calculation of daily
2676	net asset values; direct access to participant account
2677	information; or periodic reporting to participants, at least
2678	quarterly, on account balances and transactions, if these
2679	services are authorized by the state board as part of the
2680	contract.
2681	(b)1.3.  The state board shall select and contract with one
2682	or more organizations to provide educational services. With
2683	approval of the state board, the organizations may subcontract
2684	with other organizations or individuals to provide components of
2685	the educational services. As a cost of administration, the state
2686	board may compensate any such contractor for its services in
2687	accordance with the terms of the contract, as is deemed
2688	necessary or proper by the state board. The education
2689	organization may not be an approved provider or be affiliated
2690	with an approved provider.
2691	2.4.  Educational services shall be designed by the state
2692	board and department to assist employers, eligible employees,
2693	participants, and beneficiaries in order to maintain compliance
2694	with United States Department of Labor regulations under s.
2695	404(c) of the Employee Retirement Income Security Act of 1974
2696	and to assist employees in understanding their choice of defined
2697	benefit or defined contribution retirement program alternatives.
2698	Educational services include, but are not limited to,
2699	disseminating educational materials; providing retirement
2700	planning education; explaining the differences between the
2701	defined benefit retirement plan and investment programs the
2702	defined contribution retirement plan; and offering financial
2703	planning guidance on matters such as investment diversification,
2704	investment risks, investment costs, and asset allocation. An
2705	approved provider may also provide educational information,
2706	including retirement planning and investment allocation
2707	information concerning its products and services.
2708	(c)1.  In evaluating and selecting a third-party
2709	administrator, the state board shall establish criteria for
2710	evaluating under which it shall consider the relative
2711	capabilities and qualifications of each proposed administrator.
2712	In developing such criteria, the state board shall consider:
2713	a.  The administrator's demonstrated experience in
2714	providing administrative services to public or private sector
2715	retirement systems.
2716	b.  The administrator's demonstrated experience in
2717	providing daily valued recordkeeping to defined contribution
2718	programs plans.
2719	c.  The administrator's ability and willingness to
2720	coordinate its activities with the Florida Retirement System
2721	employers, the state board, and the division, and to supply to
2722	such employers, the state board, and the division the
2723	information and data they require, including, but not limited
2724	to, monthly management reports, quarterly participant reports,
2725	and ad hoc reports requested by the department or state board.
2726	d.  The cost-effectiveness and levels of the administrative
2727	services provided.
2728	e.  The administrator's ability to interact with the
2729	participants, the employers, the state board, the division, and
2730	the providers; the means by which participants may access
2731	account information, direct investment of contributions, make
2732	changes to their accounts, transfer moneys between available
2733	investment vehicles, and transfer moneys between investment
2734	products; and any fees that apply to such activities.
2735	f.  Any other factor deemed necessary by the Trustees of
2736	the state board of Administration.
2737	2.  In evaluating and selecting an educational provider,
2738	the state board shall establish criteria under which it shall
2739	consider the relative capabilities and qualifications of each
2740	proposed educational provider. In developing such criteria, the
2741	state board shall consider:
2742	a.  Demonstrated experience in providing educational
2743	services to public or private sector retirement systems.
2744	b.  Ability and willingness to coordinate its activities
2745	with the Florida Retirement System employers, the state board,
2746	and the division, and to supply to such employers, the state
2747	board, and the division the information and data they require,
2748	including, but not limited to, reports on educational contacts.
2749	c.  The cost-effectiveness and levels of the educational
2750	services provided.
2751	d.  Ability to provide educational services via different
2752	media, including, but not limited to, the Internet, personal
2753	contact, seminars, brochures, and newsletters.
2754	e.  Any other factor deemed necessary by the Trustees of
2755	the state board of Administration.
2756	3.  The establishment of the criteria shall be solely
2757	within the discretion of the state board.
2758	(d)  The state board shall develop the form and content of
2759	any contracts to be offered under the investment Public Employee
2760	Optional Retirement program. In developing the its contracts,
2761	the state board shall must consider:
2762	1.  The nature and extent of the rights and benefits to be
2763	afforded in relation to the required contributions required
2764	under the program.
2765	2.  The suitability of the rights and benefits provided to
2766	be afforded and the interests of employers in the recruitment
2767	and retention of eligible employees.
2768	(e)1.  The state board may contract with any consultant for
2769	professional services, including legal, consulting, accounting,
2770	and actuarial services, deemed necessary to implement and
2771	administer the investment optional program by the Trustees of
2772	the state board of Administration. The state board may enter
2773	into a contract with one or more vendors to provide low-cost
2774	investment advice to participants, supplemental to education
2775	provided by the third-party administrator. All fees under any
2776	such contract shall be paid by those participants who choose to
2777	use the services of the vendor.
2778	2.  The department may contract with consultants for
2779	professional services, including legal, consulting, accounting,
2780	and actuarial services, deemed necessary to implement and
2781	administer the investment optional program in coordination with
2782	the defined benefit program of the Florida Retirement System.
2783	The department, in coordination with the state board, may enter
2784	into a contract with the third-party administrator in order to
2785	coordinate services common to the various programs within the
2786	Florida Retirement System.
2787	(f)  The third-party administrator may shall not receive
2788	direct or indirect compensation from an approved provider,
2789	except as specifically provided for in the contract with the
2790	state board.
2791	(g)  The state board shall resolve any conflict between the
2792	third-party administrator and an approved provider if when such
2793	conflict threatens the implementation or administration of the
2794	program or the quality of services to employees and may resolve
2795	any other conflicts.
2796	(9)  INVESTMENT OPTIONS OR PRODUCTS; PERFORMANCE REVIEW.-
2797	(a)  The state board shall develop policy and procedures
2798	for selecting, evaluating, and monitoring the performance of
2799	approved providers and investment products to which employees
2800	may direct retirement contributions under the investment
2801	program. In accordance with such policy and procedures, the
2802	state board shall designate and contract for a number of
2803	investment products as determined by the state board. The state
2804	board shall also select one or more bundled providers, each of
2805	which whom may offer multiple investment options and related
2806	services, if when such an approach is determined by the state
2807	board to provide afford value to the participants otherwise not
2808	available through individual investment products. Each approved
2809	bundled provider may offer investment options that provide
2810	participants with the opportunity to invest in each of the
2811	following asset classes, to be composed of individual options
2812	that represent either a single asset class or a combination
2813	thereof: money markets, United States fixed income, United
2814	States equities, and foreign stock. The state board shall review
2815	and manage all educational materials, contract terms, fee
2816	schedules, and other aspects of the approved provider
2817	relationships to ensure that no provider is unduly favored or
2818	penalized by virtue of its status within the investment program
2819	plan.
2820	(b)  The state board shall consider investment options or
2821	products it considers appropriate to give participants the
2822	opportunity to accumulate retirement benefits, subject to the
2823	following:
2824	1.  The investment Public Employee Optional Retirement
2825	program must offer a diversified mix of low-cost investment
2826	products that span the risk-return spectrum and may include a
2827	guaranteed account as well as investment products, such as
2828	individually allocated guaranteed and variable annuities, which
2829	meet the requirements of this subsection and combine the ability
2830	to accumulate investment returns with the option of receiving
2831	lifetime income consistent with the long-term retirement
2832	security of a pension plan and similar to the lifetime-income
2833	benefit provided by the Florida Retirement System.
2834	2.  Investment options or products offered by the group of
2835	approved providers may include mutual funds, group annuity
2836	contracts, individual retirement annuities, interests in trusts,
2837	collective trusts, separate accounts, and other such financial
2838	instruments, and may include products that give participants the
2839	option of committing their contributions for an extended time
2840	period in an effort to obtain returns higher than those that
2841	could be obtained from investment products offering full
2842	liquidity.
2843	3.  The state board may shall not contract with a any
2844	provider that imposes a front-end, back-end, contingent, or
2845	deferred sales charge, or any other fee that limits or restricts
2846	the ability of participants to select any investment product
2847	available in the investment optional program. This prohibition
2848	does not apply to fees or charges that are imposed on
2849	withdrawals from products that give participants the option of
2850	committing their contributions for an extended time period in an
2851	effort to obtain returns higher than those that could be
2852	obtained from investment products offering full liquidity,
2853	provided that the product in question, net of all fees and
2854	charges, produces material benefits relative to other comparable
2855	products in the program offering full liquidity.
2856	4.  Fees or charges for insurance features, such as
2857	mortality and expense-risk charges, must be reasonable relative
2858	to the benefits provided.
2859	(c)  In evaluating and selecting approved providers and
2860	products, the state board shall establish criteria for
2861	evaluating under which it shall consider the relative
2862	capabilities and qualifications of each proposed provider
2863	company and product. In developing such criteria, the state
2864	board shall consider the following to the extent such factors
2865	may be applied in connection with investment products, services,
2866	or providers:
2867	1.  Experience in the United States providing retirement
2868	products and related financial services under a defined
2869	contribution retirement program plans.
2870	2.  Financial strength and stability as which shall be
2871	evidenced by the highest ratings assigned by nationally
2872	recognized rating services when comparing proposed providers
2873	that are so rated.
2874	3.  Intrastate and interstate portability of the product
2875	offered, including early withdrawal options.
2876	4.  Compliance with the Internal Revenue Code.
2877	5.  The cost-effectiveness of the product provided and the
2878	levels of service supporting the product relative to its
2879	benefits and its characteristics, including, without limitation,
2880	the level of risk borne by the provider.
2881	6.  The provider company's ability and willingness to
2882	coordinate its activities with Florida Retirement System
2883	employers, the department, and the state board, and to supply to
2884	the such employers, the department, and the state board with the
2885	information and data they require.
2886	7.  The methods available to participants to interact with
2887	the provider company; the means by which participants may access
2888	account information, direct investment of contributions, make
2889	changes to their accounts, transfer moneys between available
2890	investment vehicles, and transfer moneys between provider
2891	companies; and any fees that apply to such activities.
2892	8.  The provider company's policies with respect to the
2893	transfer of individual account balances, contributions, and
2894	earnings thereon, both internally among investment products
2895	offered by the provider company and externally between approved
2896	providers, as well as any fees, charges, reductions, or
2897	penalties that may be applied.
2898	9.  An evaluation of specific investment products, taking
2899	into account each product's experience in meeting its investment
2900	return objectives net of all related fees, expenses, and
2901	charges, including, but not limited to, investment management
2902	fees, loads, distribution and marketing fees, custody fees,
2903	recordkeeping fees, education fees, annuity expenses, and
2904	consulting fees.
2905	10.  Organizational factors, including, but not limited to,
2906	financial solvency, organizational depth, and experience in
2907	providing institutional and retail investment services.
2908	(d)  By March 1, 2010, the state board shall identify and
2909	offer at least one terror-free investment product that allocates
2910	its funds among securities not subject to divestiture as
2911	provided in s. 215.473 if the investment product is deemed by
2912	the state board to be consistent with prudent investor
2913	standards. No person may bring a civil, criminal, or
2914	administrative action against an approved provider; the state
2915	board; or any employee, officer, director, or trustee of such
2916	provider based upon the divestiture of any security or the
2917	offering of a terror-free investment product as specified in
2918	this paragraph.
2919	(e)  As a condition of offering an any investment option or
2920	product in the investment optional retirement program, the
2921	approved provider must agree to make the investment product or
2922	service available under the most beneficial terms offered to any
2923	other customer, subject to approval by the Trustees of the state
2924	board of Administration.
2925	(f)  The state board shall regularly review the performance
2926	of each approved provider and product and related organizational
2927	factors to ensure continued compliance with established
2928	selection criteria and with state board policy and procedures.
2929	Providers and products may be terminated subject to contract
2930	provisions. The state board shall adopt procedures to transfer
2931	account balances from terminated products or providers to other
2932	products or providers in the investment optional program.
2933	(g)1.  An approved provider shall comply with all
2934	applicable federal and state securities and insurance laws and
2935	regulations applicable to the provider, as well as with the
2936	applicable rules and guidelines of the National Association of
2937	Securities Dealers which govern the ethical marketing of
2938	investment products. In furtherance of this mandate, an approved
2939	provider must agree in its contract with the state board to
2940	establish and maintain a compliance education and monitoring
2941	system to supervise the activities of all personnel who directly
2942	communicate with individual participants and recommend
2943	investment products, which system is consistent with rules of
2944	the National Association of Securities Dealers.
2945	2.  Approved provider personnel who directly communicate
2946	with individual participants and who recommend investment
2947	products shall make an independent and unbiased determination as
2948	to whether an investment product is suitable for a particular
2949	participant.
2950	3.  The state board shall develop procedures to receive and
2951	resolve participant complaints against a provider or approved
2952	provider personnel, and, if when appropriate, refer such
2953	complaints to the appropriate agency.
2954	4.  Approved providers may not sell or in any way
2955	distribute any customer list or participant identification
2956	information generated through their offering of products or
2957	services through the investment optional retirement program.
2958	(10)  EDUCATION COMPONENT.-
2959	(a)  The state board, in coordination with the department,
2960	shall provide for an education component for eligible employees
2961	system members in a manner consistent with the provisions of
2962	this subsection section. The education component must be
2963	available to eligible employees at least 90 days prior to the
2964	beginning date of the election period for the employees of the
2965	respective types of employers.
2966	(b)  The education component must provide system members
2967	with impartial and balanced information about plan choices. The
2968	education component must involve multimedia formats. Program
2969	comparisons must, to the greatest extent possible, be based upon
2970	the retirement income that different retirement programs may
2971	provide to the participant. The board shall monitor the
2972	performance of the contract to ensure that the program is
2973	conducted in accordance with the contract, applicable law, and
2974	the rules of the board.
2975	(c)  The board, in coordination with the department, shall
2976	provide for an initial and ongoing transfer education component
2977	to provide system members with information necessary to make
2978	informed plan choice decisions. The transfer education component
2979	must include, but is not limited to, information on:
2980	1.  The amount of money available to a member to transfer
2981	to the defined contribution program.
2982	2.  The features of and differences between the defined
2983	benefit program and the defined contribution program, both
2984	generally and specifically, as those differences may affect the
2985	member.
2986	3.  The expected benefit available if the member were to
2987	retire under each of the retirement programs, based on
2988	appropriate alternative sets of assumptions.
2989	4.  The rate of return from investments in the defined
2990	contribution program and the period of time over which such rate
2991	of return must be achieved to equal or exceed the expected
2992	monthly benefit payable to the member under the defined benefit
2993	program.
2994	5.  The historical rates of return for the investment
2995	alternatives available in the defined contribution programs.
2996	6.  The benefits and historical rates of return on
2997	investments available in a typical deferred compensation plan or
2998	a typical plan under s. 403(b) of the Internal Revenue Code for
2999	which the employee may be eligible.
3000	7.  The program choices available to employees of the State
3001	University System and the comparative benefits of each available
3002	program, if applicable.
3003	8.  Payout options available in each of the retirement
3004	programs.
3005	(a)(d)  An ongoing education and communication component
3006	must provide eligible employees system members with information
3007	necessary to make informed decisions about choices within their
3008	retirement program of membership and in preparation for
3009	retirement. The component must include, but is not limited to,
3010	information concerning:
3011	1.  Rights and conditions of membership.
3012	2.  Benefit features within the program, options, and
3013	effects of certain decisions.
3014	3.  Coordination of contributions and benefits with a
3015	deferred compensation plan under s. 457 or a plan under s.
3016	403(b) of the Internal Revenue Code.
3017	4.  Significant program changes.
3018	5.  Contribution rates and program funding status.
3019	6.  Planning for retirement.
3020	(b)(e)  Descriptive materials must be prepared under the
3021	assumption that the employee is an unsophisticated investor, and
3022	all materials used in the education component must be approved
3023	by the state board before prior to dissemination.
3024	(c)(f)  The state board and the department shall also
3025	establish a communication component to provide program
3026	information to participating employers and the employers'
3027	personnel and payroll officers and to explain their respective
3028	responsibilities in conjunction with the retirement programs.
3029	(d)(g)  Funding for education of new employees may reflect
3030	administrative costs to the investment optional program and the
3031	defined benefit program.
3032	(h)  Pursuant to paragraph (8)(a), all Florida Retirement
3033	System employers have an obligation to regularly communicate the
3034	existence of the two Florida Retirement System plans and the
3035	plan choice in the natural course of administering their
3036	personnel functions, using the educational materials supplied by
3037	the state board and the Department of Management Services.
3038	(11)  PARTICIPANT INFORMATION REQUIREMENTS.-The state board
3039	shall ensure that each participant is provided a quarterly
3040	statement that accounts for the contributions made on behalf of
3041	the such participant; the interest and investment earnings
3042	thereon; and any fees, penalties, or other deductions that apply
3043	thereto. At a minimum, such statements must:
3044	(a)  Indicate the participant's investment options.
3045	(b)  State the market value of the account at the close of
3046	the current quarter and previous quarter.
3047	(c)  Show account gains and losses for the period and
3048	changes in account accumulation unit values for the quarter
3049	period.
3050	(d)  Itemize account contributions for the quarter.
3051	(e)  Indicate any account changes due to adjustment of
3052	contribution levels, reallocation of contributions, balance
3053	transfers, or withdrawals.
3054	(f)  Set forth any fees, charges, penalties, and deductions
3055	that apply to the account.
3056	(g)  Indicate the amount of the account in which the
3057	participant is fully vested and the amount of the account in
3058	which the participant is not vested.
3059	(h)  Indicate each investment product's performance
3060	relative to an appropriate market benchmark.
3061
3062	The third-party administrator shall provide quarterly and annual
3063	summary reports to the state board and any other reports
3064	requested by the department or the state board. In any
3065	solicitation or offer of coverage under the defined contribution
3066	an optional retirement program, a provider company shall be
3067	governed by the contract readability provisions of s. 627.4145,
3068	notwithstanding s. 627.4145(6)(c). In addition, all descriptive
3069	materials must be prepared under the assumption that the
3070	participant is an unsophisticated investor. Provider companies
3071	must maintain an internal system of quality assurance, have
3072	proven functional systems that are date-calculation compliant,
3073	and be subject to a due-diligence inquiry that proves their
3074	capacity and fitness to undertake service responsibilities.
3075	(12)  ADVISORY COUNCIL TO PROVIDE ADVICE AND ASSISTANCE.-
3076	The Investment Advisory Council, created pursuant to s. 215.444,
3077	shall assist the state board in implementing and administering
3078	the Public Employee Optional Retirement Investment Program. The
3079	Investment Advisory council, created pursuant to s. 215.444,
3080	shall review the state board's initial recommendations regarding
3081	the criteria to be used in selecting and evaluating approved
3082	providers and investment products. The council may provide
3083	comments on the recommendations to the state board within 45
3084	days after receiving the initial recommendations. The state
3085	board shall make the final determination as to whether any
3086	investment provider or product, any contractor, or any and all
3087	contract provisions are shall be approved for the investment
3088	program.
3089	(13)  FEDERAL REQUIREMENTS.-
3090	(a)  Provisions of This section shall be construed, and the
3091	investment Public Employee Optional Retirement program shall be
3092	administered, so as to comply with the Internal Revenue Code, 26
3093	U.S.C., and specifically with plan qualification requirements
3094	imposed on governmental plans under s. 401(a) of the Internal
3095	Revenue Code. The state board may shall have the power and
3096	authority to adopt rules reasonably necessary to establish or
3097	maintain the qualified status of the investment Optional
3098	Retirement program under the Internal Revenue Code and to
3099	implement and administer the investment Optional Retirement
3100	program in compliance with the Internal Revenue Code and as
3101	designated under this part; provided however, that the board
3102	shall not have the authority to adopt any rule which makes a
3103	substantive change to the Optional Retirement Program as
3104	designed by this part.
3105	(b)  Any section or provision of this chapter which is
3106	susceptible to more than one construction shall must be
3107	interpreted in favor of the construction most likely to satisfy
3108	requirements imposed by s. 401(a) of the Internal Revenue Code.
3109	(c)  Contributions payable under this section for any
3110	limitation year may not exceed the maximum amount allowable for
3111	qualified defined contribution pension plans under applicable
3112	provisions of the Internal Revenue Code. If an employee who is
3113	enrolled who has elected to participate in the Public Employee
3114	Optional Retirement Investment Program participates in any other
3115	plan that is maintained by the participating employer, benefits
3116	that accrue under the investment Public Employee Optional
3117	Retirement program shall be considered primary for any aggregate
3118	limitation applicable under s. 415 of the Internal Revenue Code.
3119	(14)  INVESTMENT POLICY STATEMENT.-
3120	(a)  Investment products and approved providers selected
3121	for the investment Public Employee Optional Retirement program
3122	must shall conform with the Public Employee Optional Retirement
3123	Investment Program Investment Policy Statement, herein referred
3124	to as the "statement," as developed and approved by the Trustees
3125	of the state board of Administration. The statement must
3126	include, among other items, the investment objectives of the
3127	investment Public Employee Optional Retirement program, manager
3128	selection and monitoring guidelines, and performance measurement
3129	criteria. As required from time to time, the executive director
3130	of the state board may present recommended changes in the
3131	statement to the state board for approval.
3132	(b)  Before Prior to presenting the statement, or any
3133	recommended changes thereto, to the state board, the executive
3134	director of the state board shall present such statement or
3135	changes to the Investment Advisory Council for review. The
3136	council shall present the results of its review to the state
3137	board prior to the state board's final approval of the statement
3138	or changes in the statement.
3139	(15)  STATEMENT OF FIDUCIARY STANDARDS AND
3140	RESPONSIBILITIES.-
3141	(a)  Investment of investment program optional defined
3142	contribution retirement plan assets shall be made for the sole
3143	interest and exclusive purpose of providing benefits to plan
3144	participants and beneficiaries and defraying reasonable expenses
3145	of administering the investment program plan. The program's
3146	assets are to be invested, on behalf of the program
3147	participants, with the care, skill, and diligence that a prudent
3148	person acting in a like manner would undertake. The performance
3149	of the investment duties set forth in this paragraph shall
3150	comply with the fiduciary standards set forth in the Employee
3151	Retirement Income Security Act of 1974 at 29 U.S.C. s.
3152	1104(a)(1)(A)-(C). In case of conflict with other provisions of
3153	law authorizing investments, the investment and fiduciary
3154	standards set forth in this subsection shall prevail.
3155	(b)  If a participant or beneficiary of the investment
3156	Public Employee Optional Retirement program exercises control
3157	over the assets in his or her account, as determined by
3158	reference to regulations of the United States Department of
3159	Labor under s. 404(c) of the Employee Retirement Income Security
3160	Act of 1974 and all applicable laws governing the operation of
3161	the program, a no program fiduciary is not shall be liable for
3162	any loss to a participant's or beneficiary's account which
3163	results from the such participant's or beneficiary's exercise of
3164	control.
3165	(c)  Subparagraph (8)(b)2. (8)(b)4. and paragraph (15)(b)
3166	incorporate the federal law concept of participant control,
3167	established by regulations of the United States Department of
3168	Labor under s. 404(c) of the Employee Retirement Income Security
3169	Act of 1974 (ERISA). The purpose of this paragraph is to assist
3170	employers and the state board of Administration in maintaining
3171	compliance with s. 404(c), while avoiding unnecessary costs and
3172	eroding participant benefits under the investment Public
3173	Employee Optional Retirement program. Pursuant to 29 C.F.R. s.
3174	2550.404c-1(b)(2)(i)(B)(1)(viii), the state board of
3175	Administration or its designated agents shall deliver to
3176	participants of the investment Public Employee Optional
3177	Retirement program a copy of the prospectus most recently
3178	provided to the plan, and, pursuant to 29 C.F.R. s. 2550.404c-
3179	1(b)(2)(i)(B)(2)(ii), shall provide such participants an
3180	opportunity to obtain this information, except that:
3181	1.  The requirement to deliver a prospectus shall be deemed
3182	to be satisfied by delivery of a fund profile that contains the
3183	information that would be included in a summary prospectus as
3184	described by Rule 498 under the Securities Act of 1933, 17
3185	C.F.R. s. 230.498. If When the transaction fees, expense
3186	information or other information provided by a mutual fund in
3187	the prospectus does not reflect terms negotiated by the state
3188	board of Administration or its designated agents, the
3189	aforementioned requirement is deemed to be satisfied by delivery
3190	of a separate document described by Rule 498 substituting
3191	accurate information; and
3192	2.  Delivery shall be deemed to have been effected if
3193	delivery is through electronic means and the following standards
3194	are satisfied:
3195	a.  Electronically-delivered documents are prepared and
3196	provided consistent with style, format, and content requirements
3197	applicable to printed documents;
3198	b.  Each participant is provided timely and adequate notice
3199	of the documents that are to be delivered and their significance
3200	thereof, and of the participant's right to obtain a paper copy
3201	of such documents free of charge;
3202	c.(I)  Participants have adequate access to the electronic
3203	documents, at locations such as their worksites or public
3204	facilities, and have the ability to convert the documents to
3205	paper free of charge by the state board of Administration, and
3206	the state board or its designated agents take appropriate and
3207	reasonable measures to ensure that the system for furnishing
3208	electronic documents results in actual receipt., or
3209	(II)  Participants have provided consent to receive
3210	information in electronic format, which consent may be revoked;
3211	and
3212	d.  The state board of Administration, or its designated
3213	agent, actually provides paper copies of the documents free of
3214	charge, upon request.
3215	(16)  DISABILITY BENEFITS.-For any participant of the
3216	investment optional retirement program who becomes totally and
3217	permanently disabled, benefits must shall be paid in accordance
3218	with the provisions of s. 121.591.
3219	(17)  SOCIAL SECURITY COVERAGE.-Social security coverage
3220	shall be provided for all officers and employees who become
3221	participants of the investment optional program. Any
3222	modification of the present agreement with the Social Security
3223	Administration, or referendum required under the Social Security
3224	Act, for the purpose of providing social security coverage for
3225	any member shall be requested by the state agency in compliance
3226	with the applicable provisions of the Social Security Act
3227	governing such coverage. However, retroactive social security
3228	coverage for service before prior to December 1, 1970, with the
3229	employer may shall not be provided for any member who was not
3230	covered under the agreement as of November 30, 1970.
3231	(18)  RETIREE HEALTH INSURANCE SUBSIDY.-All officers and
3232	employees who are participants of the investment optional
3233	program are shall be eligible to receive the retiree health
3234	insurance subsidy, subject to the provisions of s. 112.363.
3235	(19)  PARTICIPANT RECORDS.-Personal identifying information
3236	of a participant in the investment Public Employee Optional
3237	Retirement program contained in Florida Retirement System
3238	records held by the state board of Administration or the
3239	department of Management Services is exempt from s. 119.07(1)
3240	and s. 24(a), Art. I of the State Constitution.
3241	(20)  DESIGNATION OF BENEFICIARIES.-
3242	(a)  Each participant may, on a form provided for that
3243	purpose, signed and filed with the third-party administrator,
3244	designate a choice of one or more persons, named sequentially or
3245	jointly, as his or her beneficiary for receiving who shall
3246	receive the benefits, if any, which may be payable pursuant to
3247	this chapter in the event of the participant's death. If no
3248	beneficiary is named in this manner, or if no beneficiary
3249	designated by the participant survives the participant, the
3250	beneficiary shall be the spouse of the deceased, if living. If
3251	the participant's spouse is not alive at the time of the
3252	beneficiary's his or her death, the beneficiary shall be the
3253	living children of the participant. If no children survive, the
3254	beneficiary shall be the participant's father or mother, if
3255	living; otherwise, the beneficiary shall be the participant's
3256	estate. The beneficiary most recently designated by a
3257	participant on a form or letter filed with the third-party
3258	administrator shall be the beneficiary entitled to any benefits
3259	payable at the time of the participant's death. However
3260	Notwithstanding any other provision in this subsection to the
3261	contrary, for a participant who dies before prior to his or her
3262	effective date of retirement, the spouse at the time of death
3263	shall be the participant's beneficiary unless the such
3264	participant designates a different beneficiary as provided in
3265	this subsection subsequent to the participant's most recent
3266	marriage.
3267	(b)  If a participant designates a primary beneficiary
3268	other than the participant's spouse, the participant's spouse
3269	must sign the beneficiary designation form to acknowledge the
3270	designation. This requirement does not apply to the designation
3271	of one or more contingent beneficiaries to receive benefits
3272	remaining upon the death of the primary beneficiary or
3273	beneficiaries.
3274	(c)  Notwithstanding the participant's designation of
3275	benefits to be paid through a trust to a beneficiary that is a
3276	natural person, and notwithstanding the provisions of the trust,
3277	benefits must shall be paid directly to the beneficiary if the
3278	person is no longer a minor or an incapacitated person as
3279	defined in s. 744.102.
3280	(21)  PARTICIPATION BY TERMINATED DEFERRED RETIREMENT
3281	OPTION PROGRAM PARTICIPANTS.-Notwithstanding any other provision
3282	of law to the contrary, participants in the Deferred Retirement
3283	Option Program offered under part I may, after conclusion of
3284	their participation in the program, elect to roll over or
3285	authorize a direct trustee-to-trustee transfer to an account
3286	under the Public Employee Optional Retirement Investment Program
3287	of their Deferred Retirement Option Program proceeds distributed
3288	as provided under s. 121.091(13)(c)5. The transaction must
3289	constitute an "eligible rollover distribution" within the
3290	meaning of s. 402(c)(4) of the Internal Revenue Code.
3291	(a)  The investment Public Employee Optional Retirement
3292	program may accept such amounts for deposit into participant
3293	accounts as provided in paragraph (5)(c).
3294	(b)  The affected participant shall direct the investment
3295	of his or her investment account; however, unless he or she
3296	becomes a renewed member of the Florida Retirement System under
3297	s. 121.122 and elects to participate in the investment Public
3298	Employee Optional Retirement program, employer contributions may
3299	not be made to the participant's account as provided under
3300	paragraph (5)(a).
3301	(c)  The state board or the department is not responsible
3302	for locating those persons who may be eligible to participate in
3303	the investment Public Employee Optional Retirement program under
3304	this subsection.
3305	(22)  CREDIT FOR MILITARY SERVICE.-Creditable service of
3306	any member of the Public Employee Optional Retirement Investment
3307	Program includes shall include military service in the Armed
3308	Forces of the United States as provided in the conditions
3309	outlined in s. 121.111(1).
3310	Section 11.  Section 121.4502, Florida Statutes, is amended
3311	to read:
3312	121.4502  Public Employee Optional Retirement Investment
3313	Program Trust Fund.-
3314	(1)  The Public Employee Optional Retirement Investment
3315	Program Trust Fund is created to hold the assets of the Public
3316	Employee Optional Retirement Investment Program in trust for the
3317	exclusive benefit of program such program's participants and
3318	beneficiaries, and for the payment of reasonable administrative
3319	expenses of the program, in accordance with s. 401 of the
3320	Internal Revenue Code, and shall be administered by the state
3321	board of Administration as trustee. Funds shall be credited to
3322	the trust fund as provided in this part and, to be used for the
3323	purposes of this part. The trust fund is exempt from the service
3324	charges imposed by s. 215.20.
3325	(2)  The Public Employee Optional Retirement Investment
3326	Program Trust Fund is a retirement trust fund of the Florida
3327	Retirement System that accounts for retirement plan assets held
3328	by the state in a trustee capacity as a fiduciary for individual
3329	participants in the Public Employee Optional Retirement
3330	Investment Program and, pursuant to s. 19(f), Art. III of the
3331	State Constitution, is not subject to termination.
3332	Section 12.  Subsection (1) of section 121.4503, Florida
3333	Statutes, is amended to read:
3334	121.4503  Florida Retirement System Contributions Clearing
3335	Trust Fund.-
3336	(1)  The Florida Retirement System Contributions Clearing
3337	Trust Fund is created as a clearing fund for disbursing employer
3338	contributions to the component plans of the Florida Retirement
3339	System and shall be administered by the Department of Management
3340	Services. Funds shall be credited to the trust fund as provided
3341	in this chapter and shall be held in trust for the contributing
3342	employers until such time as the assets are transferred by the
3343	department to the Florida Retirement System Trust Fund, the
3344	Public Employee Optional Retirement Investment Program Trust
3345	Fund, or other trust funds as authorized by law, to be used for
3346	the purposes of this chapter. The trust fund is exempt from the
3347	service charges imposed by s. 215.20.
3348	Section 13.  Section 121.571, Florida Statutes, is amended
3349	to read:
3350	121.571  Contributions.-Contributions to the Public
3351	Employee Optional Retirement Investment Program shall be made as
3352	follows:
3353	(1)  NONCONTRIBUTORY PLAN.-Each employer shall make
3354	accomplish the monthly contributions required under by s. 121.71
3355	without reducing an by a procedure in which no employee's gross
3356	salary shall be reduced.
3357	(2)  CONTRIBUTION RATES GENERALLY.-Contributions to fund
3358	the retirement and disability benefits provided under this part
3359	must shall be based on the uniform contribution rates
3360	established by s. 121.71 and on the membership class or subclass
3361	of the participant. Such contributions must shall be allocated
3362	as provided in ss. 121.72 and 121.73.
3363	(3)  CONTRIBUTIONS FOR SOCIAL SECURITY COVERAGE AND FOR
3364	RETIREE HEALTH INSURANCE SUBSIDY.-Contributions required under
3365	s. 121.71 are this section shall be in addition to employer and
3366	member contributions required for social security and the
3367	Retiree Health Insurance Subsidy Trust Fund as required under
3368	provided in ss. 112.363, 121.052, 121.055, and 121.071, as
3369	appropriate.
3370	Section 14.  Section 121.591, Florida Statutes, is amended
3371	to read:
3372	121.591  Payment of benefits payable under the Public
3373	Employee Optional Retirement Program of the Florida Retirement
3374	System.-Benefits may not be paid under the Public Employee
3375	Retirement Investment Program this section unless the member has
3376	terminated employment as provided in s. 121.021(39)(a) or is
3377	deceased and a proper application has been filed as in the
3378	manner prescribed by the state board or the department. The
3379	state board or department, as appropriate, may cancel an
3380	application for retirement benefits if when the member or
3381	beneficiary fails to timely provide the information and
3382	documents required by this chapter and the rules of the state
3383	board and department. In accordance with their respective
3384	responsibilities as provided herein, the state board of
3385	Administration and the department of Management Services shall
3386	adopt rules establishing procedures for application for
3387	retirement benefits and for the cancellation of such application
3388	if when the required information or documents are not received.
3389	The state board of Administration and the department of
3390	Management Services, as appropriate, are authorized to cash out
3391	a de minimis account of not more than $5,000 of a participant
3392	who has been terminated from Florida Retirement System covered
3393	employment for a minimum of 6 calendar months. A de minimis
3394	account is an account containing employer contributions and
3395	accumulated earnings of not more than $5,000 made under the
3396	provisions of this chapter. Such cash-out must either be a
3397	complete lump-sum liquidation of the account balance, subject to
3398	the provisions of the Internal Revenue Code, or a lump-sum
3399	direct rollover distribution paid directly to the custodian of
3400	an eligible retirement plan, as defined by the Internal Revenue
3401	Code, on behalf of the participant. If any financial instrument
3402	issued for the payment of retirement benefits under this section
3403	is not presented for payment within 180 days after the last day
3404	of the month in which it was originally issued, the third-party
3405	administrator or other duly authorized agent of the state board
3406	of Administration shall cancel the instrument and credit the
3407	amount of the instrument to the suspense account of the Public
3408	Employee Optional Retirement Investment Program Trust Fund
3409	authorized under s. 121.4501(6). Any such amounts transferred to
3410	the suspense account are payable upon a proper application, not
3411	to include earnings thereon, as provided in this section, within
3412	10 years after the last day of the month in which the instrument
3413	was originally issued, after which time such amounts and any
3414	earnings are thereon shall be forfeited. Any such forfeited
3415	amounts are assets of the Public Employee Optional Retirement
3416	Program trust fund and are not subject to the provisions of
3417	chapter 717.
3418	(1)  NORMAL BENEFITS.-Under the Public Employee Optional
3419	Retirement Investment Program:
3420	(a)  Benefits in the form of vested accumulations as
3421	described in s. 121.4501(6) are payable under this subsection in
3422	accordance with the following terms and conditions:
3423	1.  To the extent vested, Benefits shall be paid are
3424	payable only to a participant.
3425	2.  Benefits shall be paid by the third-party administrator
3426	or designated approved providers in accordance with the law, the
3427	contracts, and any applicable state board rule or policy.
3428	3.  To receive benefits, The participant must be terminated
3429	from all employment with all Florida Retirement System
3430	employers, as provided in s. 121.021(39).
3431	4.  Benefit payments may not be made until the participant
3432	has been terminated for 3 calendar months, except that the state
3433	board may authorize by rule for the distribution of up to 10
3434	percent of the participant's account after being terminated for
3435	1 calendar month if the participant has reached the normal
3436	retirement date as defined in s. 121.021 of the defined benefit
3437	plan.
3438	5.  If a member or former member of the Florida Retirement
3439	System receives an invalid distribution from the Public Employee
3440	Optional Retirement Program Trust Fund, such person must repay
3441	the full amount invalid distribution to the trust fund within 90
3442	days after receipt of final notification by the state board or
3443	the third-party administrator that the distribution was invalid.
3444	If such person fails to repay the full invalid distribution
3445	within 90 days after receipt of final notification, the person
3446	may be deemed retired from the investment optional retirement
3447	program by the state board, as provided pursuant to s.
3448	121.4501(2)(j), and shall be is subject to s. 121.122. If such
3449	person is deemed retired by the state board, any joint and
3450	several liability set out in s. 121.091(9)(d)2. is becomes null
3451	and void, and the state board, the department, or the employing
3452	agency is not liable for gains on payroll contributions that
3453	have not been deposited to the person's account in the
3454	investment retirement program, pending resolution of the invalid
3455	distribution. The member or former member who has been deemed
3456	retired or who has been determined by the state board to have
3457	taken an invalid distribution may appeal the agency decision
3458	through the complaint process as provided under s.
3459	121.4501(9)(g)3. As used in this subparagraph, the term "invalid
3460	distribution" means any distribution from an account in the
3461	investment optional retirement program which is taken in
3462	violation of this section, s. 121.091(9), or s. 121.4501.
3463	(b)  If a participant elects to receive his or her benefits
3464	upon termination of employment as defined in s. 121.021, the
3465	participant must submit a written application or an equivalent
3466	form to the third-party administrator indicating his or her
3467	preferred distribution date and selecting an authorized method
3468	of distribution as provided in paragraph (c). The participant
3469	may defer receipt of benefits until he or she chooses to make
3470	such application, subject to federal requirements.
3471	(c)  Upon receipt by the third-party administrator of a
3472	properly executed application for distribution of benefits, the
3473	total accumulated benefit shall be payable to the participant,
3474	as:
3475	1.  A lump-sum distribution to the participant;
3476	2.  A lump-sum direct rollover distribution whereby all
3477	accrued benefits, plus interest and investment earnings, are
3478	paid from the participant's account directly to the custodian of
3479	an eligible retirement plan, as defined in s. 402(c)(8)(B) of
3480	the Internal Revenue Code, on behalf of the participant; or
3481	3.  Periodic distributions, as authorized by the state
3482	board.
3483	(2)  DISABILITY RETIREMENT BENEFITS.-Benefits provided
3484	under this subsection are payable in lieu of the benefits that
3485	which would otherwise be payable under the provisions of
3486	subsection (1). Such benefits must shall be funded entirely from
3487	employer contributions made under s. 121.571, transferred
3488	participant funds accumulated pursuant to paragraph (a), and
3489	interest and earnings thereon. Pursuant thereto:
3490	(a)  Transfer of funds.-To qualify for to receive monthly
3491	disability benefits under this subsection:
3492	1.  All moneys accumulated in the participant's Public
3493	Employee Optional Retirement Program accounts, including vested
3494	and nonvested accumulations as described in s. 121.4501(6), must
3495	shall be transferred from such individual accounts to the
3496	division of Retirement for deposit in the disability account of
3497	the Florida Retirement System Trust Fund. Such moneys must shall
3498	be separately accounted for separately. Earnings must shall be
3499	credited on an annual basis for amounts held in the disability
3500	accounts of the Florida Retirement System Trust Fund based on
3501	actual earnings of the Florida Retirement System trust fund.
3502	2.  If the participant has retained retirement credit he or
3503	she had earned under the defined benefit program of the Florida
3504	Retirement System as provided in s. 121.4501(3) s.
3505	121.4501(3)(b), a sum representing the actuarial present value
3506	of such credit within the Florida Retirement System Trust Fund
3507	shall be reassigned by the division of Retirement from the
3508	defined benefit program to the disability program as implemented
3509	under this subsection and shall be deposited in the disability
3510	account of the Florida Retirement System trust fund. Such moneys
3511	must shall be separately accounted for separately.
3512	(b)  Disability retirement; entitlement.-
3513	1.  A participant of the investment Public Employee
3514	Optional Retirement program who becomes totally and permanently
3515	disabled, as defined in paragraph (d) s. 121.091(4)(b), after
3516	completing 8 years of creditable service, or a participant who
3517	becomes totally and permanently disabled in the line of duty
3518	regardless of his or her length of service, is shall be entitled
3519	to a monthly disability benefit as provided herein.
3520	2.  In order for service to apply toward the 8 years of
3521	creditable service required to vest for regular disability
3522	benefits, or toward the creditable service used in calculating a
3523	service-based benefit as provided for under paragraph (g), the
3524	service must be creditable service as described below:
3525	a.  The participant's period of service under the
3526	investment Public Employee Optional Retirement program shall
3527	will be considered creditable service, except as provided in
3528	subparagraph d.
3529	b.  If the participant has elected to retain credit for his
3530	or her service under the defined benefit program of the Florida
3531	Retirement System as provided under s. 121.4501(3) s.
3532	121.4501(3)(b), all such service shall will be considered
3533	creditable service.
3534	c.  If the participant elects has elected to transfer to
3535	his or her participant accounts a sum representing the present
3536	value of his or her retirement credit under the defined benefit
3537	program as provided under s. 121.4501(3) s. 121.4501(3)(c), the
3538	period of service under the defined benefit program represented
3539	in the present value amounts transferred shall will be
3540	considered creditable service for purposes of vesting for
3541	disability benefits, except as provided in subparagraph d.
3542	d.  Whenever a participant has terminated employment and
3543	has taken distribution of his or her funds as provided in
3544	subsection (1), all creditable service represented by such
3545	distributed funds is forfeited for purposes of this subsection.
3546	(c)  Disability retirement effective date.-The effective
3547	retirement date for a participant who applies and is approved
3548	for disability retirement shall be established as provided under
3549	s. 121.091(4)(a)2. and 3.
3550	(d)  Total and permanent disability.-A participant shall be
3551	considered totally and permanently disabled if, in the opinion
3552	of the division, he or she is prevented, by reason of a
3553	medically determinable physical or mental impairment, from
3554	rendering useful and efficient service as an officer or
3555	employee.
3556	(e)  Proof of disability.-The division, Before approving
3557	payment of any disability retirement benefit, the division shall
3558	require proof that the participant is totally and permanently
3559	disabled in the same manner as provided for members of the
3560	defined benefit program of the Florida Retirement System under
3561	s. 121.091(4)(c).
3562	(f)  Disability retirement benefit.-Upon the disability
3563	retirement of a participant under this subsection, the
3564	participant shall receive a monthly benefit that begins accruing
3565	shall begin to accrue on the first day of the month of
3566	disability retirement, as approved by the division, and is shall
3567	be payable on the last day of that month and each month
3568	thereafter during his or her lifetime and continued disability.
3569	All disability benefits must payable to such member shall be
3570	paid out of the disability account of the Florida Retirement
3571	System Trust Fund established under this subsection.
3572	(g)  Computation of disability retirement benefit.-The
3573	amount of each monthly payment must shall be calculated in the
3574	same manner as provided for members of the defined benefit
3575	program of the Florida Retirement System under s. 121.091(4)(f).
3576	For such purpose, Creditable service under both the defined
3577	benefit program and the investment Public Employee Optional
3578	Retirement program of the Florida Retirement System shall be
3579	applicable as provided under paragraph (b).
3580	(h)  Reapplication.-A participant whose initial application
3581	for disability retirement is has been denied may reapply for
3582	disability benefits in the same manner, and under the same
3583	conditions, as provided for members of the defined benefit
3584	program of the Florida Retirement System under s. 121.091(4)(g).
3585	(i)  Membership.-Upon approval of a participant's an
3586	application for disability benefits under this subsection, the
3587	applicant shall be transferred to the defined benefit program of
3588	the Florida Retirement System, effective upon his or her
3589	disability retirement effective date.
3590	(j)  Option to cancel.-A Any participant whose application
3591	for disability benefits is approved may cancel the his or her
3592	application if for disability benefits, provided that the
3593	cancellation request is received by the division before a
3594	disability retirement warrant has been deposited, cashed, or
3595	received by direct deposit. Upon such cancellation:
3596	1.  The participant's transfer to the defined benefit
3597	program under paragraph (i) shall be nullified;
3598	2.  The participant shall be retroactively reinstated in
3599	the investment Public Employee Optional Retirement program
3600	without hiatus;
3601	3.  All funds transferred to the Florida Retirement System
3602	Trust Fund under paragraph (a) must shall be returned to the
3603	participant accounts from which the such funds were drawn; and
3604	4.  The participant may elect to receive the benefit
3605	payable under the provisions of subsection (1) in lieu of
3606	disability benefits as provided under this subsection.
3607	(k)  Recovery from disability.-
3608	1.  The division may require periodic reexaminations at the
3609	expense of the disability program account of the Florida
3610	Retirement System Trust Fund. Except as otherwise provided in
3611	subparagraph 2., the requirements, procedures, and restrictions
3612	relating to the conduct and review of such reexaminations,
3613	discontinuation or termination of benefits, reentry into
3614	employment, disability retirement after reentry into covered
3615	employment, and all other matters relating to recovery from
3616	disability shall be the same as provided are set forth under s.
3617	121.091(4)(h).
3618	2.  Upon recovery from disability, the any recipient of
3619	disability retirement benefits under this subsection shall be
3620	transferred back to the investment program a compulsory member
3621	of the Public Employee Optional Retirement Program of the
3622	Florida Retirement System. The net difference between the
3623	recipient's original account balance transferred to the Florida
3624	Retirement System Trust Fund, including earnings, under
3625	paragraph (a) and total disability benefits paid to such
3626	recipient, if any, shall be determined as provided in sub-
3627	subparagraph a.
3628	a.  An amount equal to the total benefits paid shall be
3629	subtracted from that portion of the transferred account balance
3630	consisting of vested accumulations as described under s.
3631	121.4501(6), if any, and an amount equal to the remainder of
3632	benefit amounts paid, if any, shall then be subtracted from any
3633	remaining portion consisting of nonvested accumulations as
3634	described under s. 121.4501(6).
3635	b.  Amounts subtracted under sub-subparagraph a. must shall
3636	be retained within the disability account of the Florida
3637	Retirement System Trust Fund. Any remaining account balance
3638	shall be transferred to the third-party administrator for
3639	disposition as provided under sub-subparagraph c. or sub-
3640	subparagraph d., as appropriate.
3641	c.  If the recipient returns to covered employment,
3642	transferred amounts must shall be deposited in individual
3643	accounts under the investment Public Employee Optional
3644	Retirement program, as directed by the participant. Vested and
3645	nonvested amounts shall be separately accounted for as provided
3646	in s. 121.4501(6).
3647	d.  If the recipient fails to return to covered employment
3648	upon recovery from disability:
3649	(I)  Any remaining vested amount must shall be deposited in
3650	individual accounts under the investment Public Employee
3651	Optional Retirement program, as directed by the participant, and
3652	is shall be payable as provided in subsection (1).
3653	(II)  Any remaining nonvested amount must shall be held in
3654	a suspense account and is shall be forfeitable after 5 years as
3655	provided in s. 121.4501(6).
3656	3.  If present value was reassigned from the defined
3657	benefit program to the disability program of the Florida
3658	Retirement System as provided under subparagraph (a)2., the full
3659	present value amount must shall be returned to the defined
3660	benefit account within the Florida Retirement System Trust Fund
3661	and the recipient's affected individual's associated retirement
3662	credit under the defined benefit program must shall be
3663	reinstated in full. Any benefit based upon such credit must
3664	shall be calculated as provided in s. 121.091(4)(h)1.
3665	(l)  Nonadmissible causes of disability.-A participant is
3666	shall not be entitled to receive a disability retirement benefit
3667	if the disability results from any injury or disease sustained
3668	or inflicted as described in s. 121.091(4)(i).
3669	(m)  Disability retirement of justice or judge by order of
3670	Supreme Court.-
3671	1.  If a participant is a justice of the Supreme Court,
3672	judge of a district court of appeal, circuit judge, or judge of
3673	a county court who has served for 6 years or more as an elected
3674	constitutional judicial officer, including service as a judicial
3675	officer in any court abolished pursuant to Art. V of the State
3676	Constitution, and who is retired for disability by order of the
3677	Supreme Court upon recommendation of the Judicial Qualifications
3678	Commission pursuant to s. 12, the provisions of Art. V of the
3679	State Constitution, the participant's Option 1 monthly
3680	disability benefit amount as provided in s. 121.091(6)(a)1.
3681	shall be two-thirds of his or her monthly compensation as of the
3682	participant's disability retirement date. The Such a participant
3683	may alternatively elect to receive an actuarially adjusted
3684	disability retirement benefit under any other option as provided
3685	in s. 121.091(6)(a), or to receive the normal benefit payable
3686	under the Public Employee Optional Retirement Program as set
3687	forth in subsection (1).
3688	2.  If any justice or judge who is a participant of the
3689	investment Public Employee Optional Retirement program of the
3690	Florida Retirement System is retired for disability by order of
3691	the Supreme Court upon recommendation of the Judicial
3692	Qualifications Commission pursuant to s. 12, the provisions of
3693	Art. V of the State Constitution and elects to receive a monthly
3694	disability benefit under the provisions of this paragraph:
3695	a.  Any present value amount that was transferred to his or
3696	her program account and all employer contributions made to such
3697	account on his or her behalf, plus interest and earnings
3698	thereon, must shall be transferred to and deposited in the
3699	disability account of the Florida Retirement System Trust Fund;
3700	and
3701	b.  The monthly disability benefits payable under this
3702	paragraph for any affected justice or judge retired from the
3703	Florida Retirement System pursuant to Art. V of the State
3704	Constitution shall be paid from the disability account of the
3705	Florida Retirement System Trust Fund.
3706	(n)  Death of retiree or beneficiary.-Upon the death of a
3707	disabled retiree or beneficiary of the retiree thereof who is
3708	receiving monthly disability benefits under this subsection, the
3709	monthly benefits shall be paid through the last day of the month
3710	of death and shall terminate, or be adjusted, if applicable, as
3711	of that date in accordance with the optional form of benefit
3712	selected at the time of retirement. The department of Management
3713	Services may adopt rules necessary to administer this paragraph.
3714	(3)  DEATH BENEFITS.-Under the Public Employee Optional
3715	Retirement Investment Program:
3716	(a)  Survivor benefits are shall be payable in accordance
3717	with the following terms and conditions:
3718	1.  To the extent vested, benefits are shall be payable
3719	only to a participant's beneficiary or beneficiaries as
3720	designated by the participant as provided in s. 121.4501(20).
3721	2.  Benefits must shall be paid by the third-party
3722	administrator or designated approved providers in accordance
3723	with the law, the contracts, and any applicable state board rule
3724	or policy.
3725	3.  To receive benefits under this subsection, the
3726	participant must be deceased.
3727	(b)  In the event of a participant's death, all vested
3728	accumulations as described in s. 121.4501(6), less withholding
3729	taxes remitted to the Internal Revenue Service, shall be
3730	distributed, as provided in paragraph (c) or as described in s.
3731	121.4501(20), as if the participant retired on the date of
3732	death. No other death benefits are shall be available for
3733	survivors of participants under the Public Employee Optional
3734	Retirement Program, except for such benefits, or coverage for
3735	such benefits, as are otherwise provided by law or are
3736	separately provided afforded by the employer, at the employer's
3737	discretion.
3738	(c)  Upon receipt by the third-party administrator of a
3739	properly executed application for distribution of benefits, the
3740	total accumulated benefit is shall be payable by the third-party
3741	administrator to the participant's surviving beneficiary or
3742	beneficiaries, as:
3743	1.  A lump-sum distribution payable to the beneficiary or
3744	beneficiaries, or to the deceased participant's estate;
3745	2.  An eligible rollover distribution on behalf of the
3746	surviving spouse of a deceased participant, whereby all accrued
3747	benefits, plus interest and investment earnings, are paid from
3748	the deceased participant's account directly to the custodian of
3749	an eligible retirement plan, as described in s. 402(c)(8)(B) of
3750	the Internal Revenue Code, on behalf of the surviving spouse; or
3751	3.  A partial lump-sum payment whereby a portion of the
3752	accrued benefit is paid to the deceased participant's surviving
3753	spouse or other designated beneficiaries, less withholding taxes
3754	remitted to the Internal Revenue Service, and the remaining
3755	amount is transferred directly to the custodian of an eligible
3756	retirement plan, as described in s. 402(c)(8)(B) of the Internal
3757	Revenue Code, on behalf of the surviving spouse. The proportions
3758	must be specified by the participant or the surviving
3759	beneficiary.
3760
3761	This paragraph does not abrogate other applicable provisions of
3762	state or federal law providing for payment of death benefits.
3763	(4)  LIMITATION ON LEGAL PROCESS.-The benefits payable to
3764	any person under the Public Employee Optional Retirement
3765	Investment Program, and any contributions accumulated under such
3766	program, are not subject to assignment, execution, attachment,
3767	or any legal process, except for qualified domestic relations
3768	orders by a court of competent jurisdiction, income deduction
3769	orders as provided in s. 61.1301, and federal income tax levies.
3770	Section 15.  Section 121.5911, Florida Statutes, is amended
3771	to read:
3772	121.5911  Disability retirement program; qualified status;
3773	rulemaking authority.-It is the intent of the Legislature that
3774	the disability retirement program for participants of the Public
3775	Employee Optional Retirement Investment Program as created in
3776	this act must meet all applicable requirements of federal law
3777	for a qualified plan. The department of Management Services
3778	shall seek a private letter ruling from the Internal Revenue
3779	Service on the disability retirement program for participants of
3780	the Public Employee Optional Retirement Program. Consistent with
3781	the private letter ruling, the department of Management Services
3782	shall adopt any necessary rules necessary required to maintain
3783	the qualified status of the disability retirement program and
3784	the Florida Retirement System defined benefit plan.
3785	Section 16.  Section 121.70, Florida Statutes, is amended
3786	to read:
3787	121.70  Legislative purpose and intent.-
3788	(1)  This part provides for a uniform system for funding
3789	benefits provided under the Florida Retirement System defined
3790	benefit program established under part I of this chapter
3791	(referred to in this part as the defined benefit program) and
3792	under the Public Employee Optional Retirement Investment Program
3793	established under part II of this chapter (referred to in this
3794	part as the defined contribution optional retirement program).
3795	The Legislature recognizes and declares that the Florida
3796	Retirement System is a single retirement system, consisting of
3797	two retirement plans and other nonintegrated programs. Employers
3798	participating in the Florida Retirement System collectively
3799	shall be responsible for making contributions to support the
3800	benefits provided afforded under both programs plans. The As
3801	provided in this part, employers participating in the Florida
3802	Retirement System shall make contributions based upon uniform
3803	contribution rates determined as a percentage of the total
3804	payroll for each class or subclass of Florida Retirement System
3805	membership, irrespective of which retirement program the plan
3806	individual employee is enrolled in employees may elect. This
3807	shall be known as a uniform or blended contribution rate system.
3808	(2)  In establishing a uniform contribution rate system, it
3809	is the intent of the Legislature to:
3810	(a)  Provide greater stability and certainty in financial
3811	planning and budgeting for Florida Retirement System employers
3812	by eliminating the fiscal instability that would be caused by
3813	dual rates coupled with employee-selected plan participation;
3814	and
3815	(b)  Provide greater fiscal equity and uniformity for
3816	system employers by effectively distributing the financial
3817	burden and benefit of short-term system deficits and surpluses,
3818	respectively, in proportion to total system payroll.; and
3819	(c)  Allow employees to make their retirement plan
3820	selection decisions free of circumstances that may cause
3821	employers to favor one plan choice over another.
3822	Section 17.  Subsection (1) of section 121.71, Florida
3823	Statutes, is amended to read:
3824	121.71  Uniform rates; process; calculations; levy.-
3825	(1)  In conducting the system actuarial study required
3826	under s. 121.031, the actuary shall follow all requirements
3827	specified thereunder to determine, by Florida Retirement System
3828	employee membership class, the dollar contribution amounts
3829	necessary for the next forthcoming fiscal year for the defined
3830	benefit program. In addition, the actuary shall determine, by
3831	Florida Retirement System membership class, based on an estimate
3832	for the forthcoming fiscal year of the gross compensation of
3833	employees participating in the defined contribution optional
3834	retirement program, the dollar contribution amounts necessary to
3835	make the allocations required under ss. 121.72 and 121.73. For
3836	each employee membership class and subclass, the actuarial study
3837	must shall establish a uniform rate necessary to fund the
3838	benefit obligations under both Florida Retirement System
3839	retirement plans by dividing the sum of total dollars required
3840	by the estimated gross compensation of members in both plans.
3841	Section 18.  Section 121.72, Florida Statutes, is amended
3842	to read:
3843	121.72  Allocations to defined contribution optional
3844	retirement program participant accounts; percentage amounts.-
3845	(1)  The allocations established in subsection (4) shall
3846	fund retirement benefits under the defined contribution optional
3847	retirement program and shall be transferred monthly by the
3848	Division of Retirement from the Florida Retirement System
3849	Contributions Clearing Trust Fund to the third-party
3850	administrator for deposit in each participating employee's
3851	individual account based on the membership class of the
3852	participant.
3853	(2)  The allocations are stated as a percentage of each
3854	defined contribution optional retirement program participant's
3855	gross compensation for the calendar month. A change in a
3856	contribution percentage is effective the first day of the month
3857	for which a full month's employer contribution may be made on or
3858	after the beginning date of the change. Contribution percentages
3859	may be modified by general law.
3860	(3)  Employer and participant contributions to participant
3861	accounts shall be accounted for separately. Participant
3862	contributions may be made only if expressly authorized by law.
3863	Interest and investment earnings on contributions shall accrue
3864	on a tax-deferred basis until proceeds are distributed.
3865	(4)  Effective July 1, 2002, allocations from the Florida
3866	Retirement System Contributions Clearing Trust Fund to defined
3867	contribution optional retirement program participant accounts
3868	shall be as follows:
3869
	Membership Class Percentage of Gross Compensation
3870
	Regular Class 9.00%
3871
	Special Risk Class 20.00%
3872
	Special Risk Administrative Support Class 11.35%
3873
	Elected Officers' Class-  Legislators, Governor,   Lt. Governor, Cabinet Officers,    State Attorneys, Public Defenders 13.40%
3874
	Elected Officers' Class-  Justices, Judges 18.90%
3875
	Elected Officers' Class-  County Elected Officers 16.20%
3876
	Senior Management Service Class 10.95%
3877
3878	Section 19.  Section 121.73, Florida Statutes, is amended
3879	to read:
3880	121.73  Allocations for defined contribution optional
3881	retirement program participant disability coverage; percentage
3882	amounts.-
3883	(1)  The allocations established in subsection (3) shall be
3884	used to provide disability coverage for participants in the
3885	defined contribution optional retirement program and shall be
3886	transferred monthly by the Division of Retirement from the
3887	Florida Retirement System Contributions Clearing Trust Fund to
3888	the disability account of the Florida Retirement System Trust
3889	Fund.
3890	(2)  The allocations are stated as a percentage of each
3891	defined contribution optional retirement program participant's
3892	gross compensation for the calendar month. A change in a
3893	contribution percentage is effective the first day of the month
3894	for which a full month's employer contribution may be made on or
3895	after the beginning date of the change. Contribution percentages
3896	may be modified by general law.
3897	(3)  Effective July 1, 2002, allocations from the Florida
3898	Retirement System FRS Contribution Clearing Fund to provide
3899	disability coverage for participants in the defined contribution
3900	optional retirement program, and to offset the costs of
3901	administering said coverage, shall be as follows:
3902
	Membership Class Percentage of Gross Compensation
3903
	Regular Class 0.25%
3904
	Special Risk Class 1.33%
3905
	Special Risk Administrative Support Class 0.45%
3906
	Elected Officers' Class-  Legislators, Governor,   Lt. Governor, Cabinet Officers,   State Attorneys, Public Defenders 0.41%
3907
	Elected Officers' Class-  Justices, Judges 0.73%
3908
	Elected Officers' Class-  County Elected Officers 0.41%
3909
	Senior Management Service Class 0.26%
3910
3911	Section 20.  Section 121.74, Florida Statutes, is amended
3912	to read:
3913	121.74  Administrative and educational expenses.-In
3914	addition to contributions required under s. 121.71, employers
3915	participating in the Florida Retirement System shall contribute
3916	an amount equal to 0.05 percent of the payroll reported for each
3917	class or subclass of Florida Retirement System membership, which
3918	amount shall be transferred by the Division of Retirement from
3919	the Florida Retirement System Contributions Clearing Trust Fund
3920	to the state board's State Board of Administration's
3921	Administrative Trust Fund to offset the costs of administering
3922	the defined contribution optional retirement program and the
3923	costs of providing educational services to participants in the
3924	defined benefit program and the defined contribution optional
3925	retirement program. Approval of the Trustees of the State Board
3926	of Administration is required prior to the expenditure of these
3927	funds. Payments for third-party administrative or educational
3928	expenses shall be made only pursuant to the terms of the
3929	approved contracts for such services.
3930	Section 21.  Section 121.77, Florida Statutes, is amended
3931	to read:
3932	121.77  Deductions from participant accounts.-The state
3933	board of Administration may authorize the third-party
3934	administrator to deduct reasonable fees and apply appropriate
3935	charges to defined contribution optional retirement program
3936	participant accounts. In no event may shall administrative and
3937	educational expenses exceed the portion of employer
3938	contributions earmarked for such expenses under this part,
3939	except for reasonable administrative charges assessed against
3940	participant accounts of persons for whom no employer
3941	contributions are made during the calendar quarter. Investment
3942	management fees shall be deducted from participant accounts,
3943	pursuant to the terms of the contract between the provider and
3944	the state board.
3945	Section 22.  Subsection (3) of section 121.78, Florida
3946	Statutes, is amended to read:
3947	121.78  Payment and distribution of contributions.-
3948	(3)(a)  Employer contributions and accompanying payroll
3949	data received after the 5th working day of the month shall be
3950	considered late. The employer shall be assessed by the Division
3951	of Retirement a penalty of 1 percent of the contributions due
3952	for each calendar month or part thereof that the contributions
3953	or accompanying payroll data are late. Proceeds from the 1-
3954	percent assessment against contributions made on behalf of
3955	participants of the defined benefit program must shall be
3956	deposited in the Florida Retirement System Trust Fund, and
3957	proceeds from the 1-percent assessment against contributions
3958	made on behalf of participants of the defined contribution
3959	optional retirement program shall be transferred to the third-
3960	party administrator for deposit into participant accounts, as
3961	provided in paragraph (b).
3962	(b)  If contributions made by an employer on behalf of
3963	participants of the defined contribution optional retirement
3964	program or accompanying payroll data are not received within the
3965	calendar month they are due, including, but not limited to,
3966	contribution adjustments as a result of employer errors or
3967	corrections, and if that delinquency results in market losses to
3968	participants, the employer shall reimburse each participant's
3969	account for market losses resulting from the late contributions.
3970	If a participant has terminated employment and taken a
3971	distribution, the participant is responsible for returning any
3972	excess contributions erroneously provided by employers, adjusted
3973	for any investment gain or loss incurred during the period such
3974	excess contributions were in the participant's Public Employee
3975	Optional Retirement Program account. The state board of
3976	Administration or its designated agent shall communicate to
3977	terminated participants any obligation to repay such excess
3978	contribution amounts. However, the state board of
3979	Administration, its designated agents, the Public Employee
3980	Optional Retirement Investment Program Trust Fund, the
3981	Department of Management Services, or the Florida Retirement
3982	System Trust Fund may shall not incur any loss or gain as a
3983	result of an employer's correction of such excess contributions.
3984	The third-party administrator, hired by the state board pursuant
3985	to s. 121.4501(8), shall calculate the market losses for each
3986	affected participant. If When contributions made on behalf of
3987	participants of the defined contribution optional retirement
3988	program or accompanying payroll data are not received within the
3989	calendar month due, the employer shall also pay the cost of the
3990	third-party administrator's calculation and reconciliation
3991	adjustments resulting from the late contributions. The third-
3992	party administrator shall notify the employer of the results of
3993	the calculations and the total amount due from the employer for
3994	such losses and the costs of calculation and reconciliation. The
3995	employer shall remit to the division the amount due within 10
3996	working days after the date of the penalty notice sent by the
3997	division. The Division of Retirement shall transfer said amount
3998	to the third-party administrator, which who shall deposit
3999	proceeds from the 1-percent assessment and from individual
4000	market losses into participant accounts, as appropriate. The
4001	state board is authorized to adopt rules to implement the
4002	provisions regarding late contributions, late submission of
4003	payroll data, the process for reimbursing participant accounts
4004	for resultant market losses, and the penalties charged to the
4005	employers.
4006	(c)  Delinquency fees may be waived by the Division of
4007	Retirement, with regard to defined benefit program
4008	contributions, and by the state board of Administration, with
4009	regard to defined contribution optional retirement program
4010	contributions, only if when, in the opinion of the division or
4011	the state board, as appropriate, exceptional circumstances
4012	beyond the employer's control prevented remittance by the
4013	prescribed due date, notwithstanding the employer's good faith
4014	efforts to effect delivery. Such a waiver of delinquency may be
4015	granted an employer only one time each state fiscal year.
4016	Section 23.  The Division of Statutory Revision is directed
4017	to redesignate the title of part II of chapter 121, Florida
4018	Statutes, as "Public Employee Retirement Investment Program."
4019	Section 24.  This act shall take effect July 1, 2010.

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