Florida Senate - 2011             CONFERENCE COMMITTEE AMENDMENT
       Bill No. SB 2100, 2nd Eng.
       
       
       
       
       
       
                                Barcode 328098                          
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
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                 Floor: AD/CR          .                                
             05/06/2011 06:07 PM       .                                
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       The Conference Committee on SB 2100, 2nd Eng. recommended the
       following:
       
    1         Senate Conference Committee Amendment (with title
    2  amendment)
    3  
    4         Delete everything after the enacting clause
    5  and insert:
    6         Section 1. Paragraph (g) of subsection (2) of section
    7  110.123, Florida Statutes, is amended to read:
    8         110.123 State group insurance program.—
    9         (2) DEFINITIONS.—As used in this section, the term:
   10         (g) “Retired state officer or employee” or “retiree” means
   11  any state or state university officer or employee who retires
   12  under a state retirement system or a state optional annuity or
   13  retirement program or is placed on disability retirement, and
   14  who was insured under the state group insurance program at the
   15  time of retirement, and who begins receiving retirement benefits
   16  immediately after retirement from state or state university
   17  office or employment. The term also includes In addition to
   18  these requirements, any state officer or state employee who
   19  retires under the Florida Retirement System Investment Plan
   20  Public Employee Optional Retirement Program established under
   21  part II of chapter 121 shall be considered a “retired state
   22  officer or employee” or “retiree” as used in this section if he
   23  or she:
   24         1. Meets the age and service requirements to qualify for
   25  normal retirement as set forth in s. 121.021(29); or
   26         2. Has attained the age specified by s. 72(t)(2)(A)(i) of
   27  the Internal Revenue Code and has 6 years of creditable service.
   28         Section 2. Section 112.0801, Florida Statutes, is amended
   29  to read:
   30         112.0801 Group insurance; participation by retired
   31  employees.—
   32         (1) Any state agency, county, municipality, special
   33  district, community college, or district school board that which
   34  provides life, health, accident, hospitalization, or annuity
   35  insurance, or all of any kinds of such insurance, for its
   36  officers and employees and their dependents upon a group
   37  insurance plan or self-insurance plan shall allow all former
   38  personnel who have retired before prior to October 1, 1987, as
   39  well as those who retire on or after such date, and their
   40  eligible dependents, the option of continuing to participate in
   41  the such group insurance plan or self-insurance plan. Retirees
   42  and their eligible dependents shall be offered the same health
   43  and hospitalization insurance coverage as is offered to active
   44  employees at a premium cost of no more than the premium cost
   45  applicable to active employees. For the retired employees and
   46  their eligible dependents, the cost of any such continued
   47  participation in any type of plan or any of the cost thereof may
   48  be paid by the employer or by the retired employees. To
   49  determine health and hospitalization plan costs, the employer
   50  shall commingle the claims experience of the retiree group with
   51  the claims experience of the active employees; and, for other
   52  types of coverage, the employer may commingle the claims
   53  experience of the retiree group with the claims experience of
   54  active employees. Retirees covered under Medicare may be
   55  experience-rated separately from the retirees not covered by
   56  Medicare and from active employees if, provided that the total
   57  premium does not exceed that of the active group and coverage is
   58  basically the same as for the active group.
   59         (2) For purposes of this section, “retiree” means any
   60  officer or employee who retires under a state retirement system
   61  or a state optional annuity or retirement program or is placed
   62  on disability retirement and who begins receiving retirement
   63  benefits immediately after retirement from employment. In
   64  addition to these requirements, any officer or employee who
   65  retires under the Florida Retirement System Investment Plan
   66  Public Employee Optional Retirement Program established under
   67  part II of chapter 121 is shall be considered a “retired officer
   68  or employee” or “retiree” as used in this section if he or she:
   69         (a) Meets the age and service requirements to qualify for
   70  normal retirement as set forth in s. 121.021(29); or
   71         (b) Has attained the age specified by s. 72(t)(2)(A)(i) of
   72  the Internal Revenue Code and has the years of service required
   73  for vesting as set forth in s. 121.021(45) 6 years of creditable
   74  service.
   75         Section 3. Paragraphs (b) and (c) of subsection (2) and
   76  paragraph (e) of subsection (3) of section 112.363, Florida
   77  Statutes, are amended to read:
   78         112.363 Retiree health insurance subsidy.—
   79         (2) ELIGIBILITY FOR RETIREE HEALTH INSURANCE SUBSIDY.—
   80         (b) For purposes of this section, a person is deemed
   81  retired from a state-administered retirement system when he or
   82  she terminates employment with all employers participating in
   83  the Florida Retirement System as described in s. 121.021(39)
   84  and:
   85         1. For a member participant of the investment plan Public
   86  Employee Optional Retirement Program established under part II
   87  of chapter 121, the participant meets the age or service
   88  requirements to qualify for normal retirement as set forth in s.
   89  121.021(29) and meets the definition of retiree in s.
   90  121.4501(2).
   91         2. For a member of the Florida Retirement System Pension
   92  Plan defined benefit program, or any employee who maintains
   93  creditable service under both the pension plan defined benefit
   94  program and the investment plan Public Employee Optional
   95  Retirement Program, the member begins drawing retirement
   96  benefits from the pension plan defined benefit program of the
   97  Florida Retirement System.
   98         (c)1. Effective July 1, 2001, any person retiring on or
   99  after that such date as a member of the Florida Retirement
  100  System, including a member any participant of the investment
  101  plan defined contribution program administered pursuant to part
  102  II of chapter 121, must have satisfied the vesting requirements
  103  for his or her membership class under the pension plan Florida
  104  Retirement System defined benefit program as administered under
  105  part I of chapter 121. However,
  106         2. Notwithstanding the provisions of subparagraph 1., a
  107  person retiring due to disability must either qualify for a
  108  regular or in-line-of-duty disability benefit as provided in s.
  109  121.091(4) or qualify for a disability benefit under a
  110  disability plan established under part II of chapter 121, as
  111  appropriate.
  112         (3) RETIREE HEALTH INSURANCE SUBSIDY AMOUNT.—
  113         (e)1. Beginning July 1, 2001, each eligible retiree of the
  114  pension plan defined benefit program of the Florida Retirement
  115  System, or, if the retiree is deceased, his or her beneficiary
  116  who is receiving a monthly benefit from such retiree’s account
  117  and who is a spouse, or a person who meets the definition of
  118  joint annuitant in s. 121.021(28), shall receive a monthly
  119  retiree health insurance subsidy payment equal to the number of
  120  years of creditable service, as defined in s. 121.021(17),
  121  completed at the time of retirement multiplied by $5; however,
  122  no eligible retiree or beneficiary may receive a subsidy payment
  123  of more than $150 or less than $30. If there are multiple
  124  beneficiaries, the total payment may must not be greater than
  125  the payment to which the retiree was entitled. The health
  126  insurance subsidy amount payable to any person receiving the
  127  retiree health insurance subsidy payment on July 1, 2001, may
  128  shall not be reduced solely by operation of this subparagraph.
  129         2. Beginning July 1, 2002, each eligible member participant
  130  of the investment plan Public Employee Optional Retirement
  131  Program of the Florida Retirement System who has met the
  132  requirements of this section, or, if the member participant is
  133  deceased, his or her spouse who is the member’s participant’s
  134  designated beneficiary, shall receive a monthly retiree health
  135  insurance subsidy payment equal to the number of years of
  136  creditable service, as provided in this subparagraph, completed
  137  at the time of retirement, multiplied by $5; however, an no
  138  eligible retiree or beneficiary may not receive a subsidy
  139  payment of more than $150 or less than $30. For purposes of
  140  determining a member’s participant’s creditable service used to
  141  calculate the health insurance subsidy, a member’s participant’s
  142  years of service credit or fraction thereof shall be based on
  143  the member’s participant’s work year as defined in s.
  144  121.021(54). Credit must shall be awarded for a full work year
  145  if whenever health insurance subsidy contributions have been
  146  made as required by law for each month in the member’s
  147  participant’s work year. In addition, all years of creditable
  148  service retained under the Florida Retirement System Pension
  149  Plan must defined benefit program shall be included as
  150  creditable service for purposes of this section. Notwithstanding
  151  any other provision in this section to the contrary, the spouse
  152  at the time of death is shall be the member’s participant’s
  153  beneficiary unless such member participant has designated a
  154  different beneficiary subsequent to the member’s participant’s
  155  most recent marriage.
  156         Section 4. Subsection (1) of section 112.65, Florida
  157  Statutes, is amended to read:
  158         112.65 Limitation of benefits.—
  159         (1) ESTABLISHMENT OF PROGRAM.—The normal retirement benefit
  160  or pension payable to a retiree who becomes a member of any
  161  retirement system or plan and who has not previously
  162  participated in such plan, on or after January 1, 1980, may
  163  shall not exceed 100 percent of his or her average final
  164  compensation. However, nothing contained in this section does
  165  not shall apply to supplemental retirement benefits or to
  166  pension increases attributable to cost-of-living increases or
  167  adjustments. For the purposes of this section, benefits accruing
  168  in individual member participant accounts established under the
  169  investment plan Public Employee Optional Retirement Program
  170  established in part II of chapter 121 are considered
  171  supplemental benefits. As used in this section, the term
  172  “average final compensation” means the average of the member’s
  173  earnings over a period of time which the governmental entity has
  174  established by statute, charter, or ordinance.
  175         Section 5. Paragraph (g) of subsection (3) of section
  176  121.011, Florida Statutes, is amended, and paragraph (h) is
  177  added to that subsection, to read:
  178         121.011 Florida Retirement System.—
  179         (3) PRESERVATION OF RIGHTS.—
  180         (g) Any member of the Florida Retirement System or any
  181  member of an existing system under this chapter who is not
  182  retired and who is, has been, or shall be dismissed from
  183  employment shall be considered terminated from active membership
  184  in such system.
  185         1. If such dismissal is rescinded by proper authority or
  186  through legal proceedings, the member is eligible to receive
  187  retirement service credit for such period of dismissal if
  188  provided:
  189         a. The dismissal action taken against the member is
  190  determined to be incorrect and is negated, the employee is made
  191  whole for the period of the dismissal or any portion thereof,
  192  and employment is reinstated; and
  193         b. The employer pays into the Retirement System Trust Fund
  194  the total required employer contributions for the period for
  195  which the employee is made whole, plus interest at 6.5 percent
  196  compounded annually until full payment is made. The employee
  197  shall pay the total employee contributions, plus interest, if
  198  applicable. The employer shall pay the interest on employee
  199  contributions, if applicable.
  200         2. If the dismissal action is subsequently changed to a
  201  suspension by proper authority or through legal proceedings, the
  202  member is eligible to receive retirement service credit,
  203  provided the member’s employment is reinstated, restoring the
  204  employee-employer relationship, and the employee pays the total
  205  required employer and employee contributions and complies with
  206  all requirements in paragraph (e).
  207         (h) Effective July 1, 2011, the retirement system shall
  208  require employer and employee contributions as provided in s.
  209  121.071 and part III of this chapter.
  210         Section 6. Subsections (3), (7), and (15), paragraph (a) of
  211  subsection (19), paragraph (b) of subsection (22), and
  212  subsections (24), (29), (38), (39), (45), (55), and (59) of
  213  section 121.021, Florida Statutes, are amended to read:
  214         121.021 Definitions.—The following words and phrases as
  215  used in this chapter have the respective meanings set forth
  216  unless a different meaning is plainly required by the context:
  217         (3) “Florida Retirement System” or “system” means the
  218  general retirement system established by this chapter, to be
  219  known and cited as the “Florida Retirement System,” including,
  220  but not limited to, the defined benefit retirement program
  221  administered under the provisions of part I of this part,
  222  referred to as the “Florida Retirement System Pension Plan” or
  223  “pension plan,” chapter and the defined contribution retirement
  224  program known as the Public Employee Optional Retirement Program
  225  and administered under the provisions of part II of this
  226  chapter, referred to as the “Florida Retirement System
  227  Investment Plan” or “investment plan”.
  228         (7) “Division” means the Division of Retirement in the
  229  department. “City” means any municipality duly incorporated
  230  under the laws of the state.
  231         (15) “Special risk member” or “Special Risk Class member”
  232  means a member of the Florida Retirement System who meets the
  233  eligibility and criteria required under s. 121.0515 for
  234  participation in the Special Risk Class.
  235         (a) Until October 1, 1978, “special risk member” means any
  236  officer or employee whose application is approved by the
  237  administrator and who receives salary payments for work
  238  performed as a peace officer; law enforcement officer; police
  239  officer; highway patrol officer; custodial employee at a
  240  correctional or detention facility; correctional agency employee
  241  whose duties and responsibilities involve direct contact with
  242  inmates, but excluding secretarial and clerical employees;
  243  firefighter; or an employee in any other job in the field of law
  244  enforcement or fire protection if the duties of such person are
  245  certified as hazardous by his or her employer.
  246         (b) Effective October 1, 1978, “special risk member” means
  247  a member of the Florida Retirement System who is designated as a
  248  special risk member by the division in accordance with s.
  249  121.0515. Such member must be employed as a law enforcement
  250  officer, a firefighter, or a correctional officer and must meet
  251  certain other special criteria as set forth in s. 121.0515.
  252         (c) Effective October 1, 1999, “special risk member” means
  253  a member of the Florida Retirement System who is designated as a
  254  special risk member by the division in accordance with s.
  255  121.0515. Such member must be employed as a law enforcement
  256  officer, a firefighter, a correctional officer, an emergency
  257  medical technician, or a paramedic and must meet certain other
  258  special criteria as set forth in s. 121.0515.
  259         (d)1. Effective January 1, 2001, “special risk member”
  260  includes any member who is employed as a community-based
  261  correctional probation officer and meets the special criteria
  262  set forth in s. 121.0515(2)(e).
  263         2. Effective January 1, 2001, “special risk member”
  264  includes any professional health care bargaining unit or non
  265  unit member who is employed by the Department of Corrections or
  266  the Department of Children and Family Services and meets the
  267  special criteria set forth in s. 121.0515(2)(f).
  268         (e) Effective July 1, 2001, the term “special risk member”
  269  includes any member who is employed as a youth custody officer
  270  by the Department of Juvenile Justice and meets the special
  271  criteria set forth in s. 121.0515(2)(g).
  272         (f) Effective August 1, 2008, “special risk member”
  273  includes any member who meets the special criteria for continued
  274  membership set forth in s. 121.0515(2)(k).
  275         (19) “Prior service” under part I of this chapter means:
  276         (a) Service for which the member had credit under one of
  277  the existing systems and received a refund of his or her
  278  contributions upon termination of employment. Prior service
  279  shall also includes include that service between December 1,
  280  1970, and the date the system becomes noncontributory for which
  281  the member had credit under the Florida Retirement System and
  282  received a refund of his or her contributions upon termination
  283  of employment.
  284         (22) “Compensation” means the monthly salary paid a member
  285  by his or her employer for work performed arising from that
  286  employment.
  287         (b) Under no circumstances shall Compensation for a member
  288  participating in the pension plan defined benefit retirement
  289  program or the investment plan Public Employee Optional
  290  Retirement Program of the Florida Retirement System may not
  291  include:
  292         1. Fees paid professional persons for special or particular
  293  services or include salary payments made from a faculty practice
  294  plan authorized by the Board of Governors of the State
  295  University System for eligible clinical faculty at a college in
  296  a state university that has a faculty practice plan; or
  297         2. Any bonuses or other payments prohibited from inclusion
  298  in the member’s average final compensation and defined in
  299  subsection (47).
  300         (24)(a) “Average final compensation” means:
  301         1. For members initially enrolled before July 1, 2011, the
  302  average of the 5 highest fiscal years of compensation for
  303  creditable service before prior to retirement, termination, or
  304  death. For in-line-of-duty disability benefits, if less than 5
  305  years of creditable service have been completed, the term
  306  “average final compensation” means the average annual
  307  compensation of the total number of years of creditable service.
  308  Each year used to calculate the in the calculation of average
  309  final compensation commences shall commence on July 1.
  310         2. For members initially enrolled on or after July 1, 2011,
  311  the average of the 8 highest fiscal years of compensation for
  312  creditable service before retirement, termination, or death. For
  313  in-line-of-duty disability benefits, if less than 8 years of
  314  creditable service have been completed, the term means the
  315  average annual compensation of the total number of years of
  316  creditable service. Each year used to calculate average final
  317  compensation commences on July 1.
  318         (b)(a) The average final compensation includes shall
  319  include:
  320         1. Accumulated annual leave payments, not to exceed 500
  321  hours; and
  322         2. All payments defined as compensation in subsection (22).
  323         (c)(b) The average final compensation does shall not
  324  include:
  325         1. Compensation paid to professional persons for special or
  326  particular services;
  327         2. Payments for accumulated sick leave made due to
  328  retirement or termination;
  329         3. Payments for accumulated annual leave in excess of 500
  330  hours;
  331         4. Bonuses as defined in subsection (47);
  332         5. Third party payments made on and after July 1, 1990; or
  333         6. Fringe benefits (for example, automobile allowances or
  334  housing allowances).
  335         (29) “Normal retirement date” means the date a member
  336  attains normal retirement age and is vested, which is determined
  337  as follows:
  338         (a)1. If a Regular Class member, a Senior Management
  339  Service Class member, or an Elected Officers’ Class member
  340  initially enrolled before July 1, 2011:
  341         a.1. The first day of the month the member completes 6 or
  342  more years of creditable service and attains age 62; or
  343         b.2. The first day of the month following the date the
  344  member completes 30 years of creditable service, regardless of
  345  age.
  346         2. If a Regular Class member, a Senior Management Service
  347  Class member, or an Elected Officers’ Class member initially
  348  enrolled on or after July 1, 2011:
  349         a. The first day of the month the member attains age 65; or
  350         b. The first day of the month following the date the member
  351  completes 33 years of creditable service, regardless of age.
  352         (b)1. If a Special Risk Class member initially enrolled
  353  before July 1, 2011:
  354         a.1. The first day of the month the member completes 6 or
  355  more years of creditable service in the Special Risk Class and
  356  attains age 55 and completes the years of creditable service in
  357  the Special Risk Class equal to or greater than the years of
  358  service required for vesting;
  359         b.2. The first day of the month following the date the
  360  member completes 25 years of creditable service in the Special
  361  Risk Class, regardless of age; or
  362         c.3. The first day of the month following the date the
  363  member completes 25 years of creditable service and attains age
  364  52, which service may include a maximum of 4 years of military
  365  service credit if as long as such credit is not claimed under
  366  any other system and the remaining years are in the Special Risk
  367  Class.
  368         2. If a Special Risk Class member initially enrolled on or
  369  after July 1, 2011:
  370         a. The first day of the month the member attains age 60 and
  371  completes the years of creditable service in the Special Risk
  372  Class equal to or greater than the years of service required for
  373  vesting;
  374         b. The first day of the month following the date the member
  375  completes 30 years of creditable service in the Special Risk
  376  Class, regardless of age; or
  377         c. The first day of the month following the date the member
  378  completes 30 years of creditable service and attains age 57,
  379  which service may include a maximum of 4 years of military
  380  service credit if such credit is not claimed under any other
  381  system and the remaining years are in the Special Risk Class.
  382  
  383  “Normal retirement age” is attained on the “normal retirement
  384  date.”
  385         (38) “Continuous service” means creditable service as a
  386  member, beginning with the first day of employment with an
  387  employer covered under a state-administered retirement system
  388  consolidated herein and continuing for as long as the member
  389  remains in an employer-employee relationship with an employer
  390  covered under this chapter. An absence of 1 calendar month or
  391  more from an employer’s payroll shall be considered a break in
  392  continuous service, except for periods of absence during which
  393  an employer-employee relationship continues to exist and such
  394  period of absence is creditable under this chapter or under one
  395  of the existing systems consolidated herein. However, a law
  396  enforcement officer as defined in s. 121.0515(3)(2)(a) who was a
  397  member of a state-administered retirement system under chapter
  398  122 or chapter 321 and who resigned and was subsequently
  399  reemployed in a law enforcement position within 12 calendar
  400  months of such resignation by an employer under such state
  401  administered retirement system shall be deemed to have not
  402  experienced a break in service. Further, with respect to a
  403  state-employed law enforcement officer who meets the criteria
  404  specified in s. 121.0515(3)(2)(a), if the absence from the
  405  employer’s payroll is the result of a “layoff” as defined in s.
  406  110.107 or a resignation to run for an elected office that meets
  407  the criteria specified in s. 121.0515(3)(2)(a), no break in
  408  continuous service shall be deemed to have occurred if the
  409  member is reemployed as a state law enforcement officer or is
  410  elected to an office which meets the criteria specified in s.
  411  121.0515(3)(2)(a) within 12 calendar months after the date of
  412  the layoff or resignation, notwithstanding the fact that such
  413  period of layoff or resignation is not creditable service under
  414  this chapter. A withdrawal of contributions will constitute a
  415  break in service. Continuous service also includes past service
  416  purchased under this chapter, provided such service is
  417  continuous within this definition and the rules established by
  418  the administrator. The administrator may establish
  419  administrative rules and procedures for applying this definition
  420  to creditable service authorized under this chapter. Any
  421  correctional officer, as defined in s. 943.10, whose
  422  participation in the state-administered retirement system is
  423  terminated due to the transfer of a county detention facility
  424  through a contractual agreement with a private entity pursuant
  425  to s. 951.062, shall be deemed an employee with continuous
  426  service in the Special Risk Class, provided return to employment
  427  with the former employer takes place within 3 years due to
  428  contract termination or the officer is employed by a covered
  429  employer in a special risk position within 1 year after his or
  430  her initial termination of employment by such transfer of its
  431  detention facilities to the private entity.
  432         (39)(a) “Termination” occurs, except as provided in
  433  paragraph (b), when a member ceases all employment relationships
  434  with participating employers an employer, however:
  435         1. For retirements effective before July 1, 2010, if a
  436  member is employed by any such employer within the next calendar
  437  month, termination shall be deemed not to have occurred. A leave
  438  of absence constitutes a continuation of the employment
  439  relationship, except that a leave of absence without pay due to
  440  disability may constitute termination if such member makes
  441  application for and is approved for disability retirement in
  442  accordance with s. 121.091(4). The department or state board may
  443  require other evidence of termination as it deems necessary.
  444         2. For retirements effective on or after July 1, 2010, if a
  445  member is employed by any such employer within the next 6
  446  calendar months, termination shall be deemed not to have
  447  occurred. A leave of absence constitutes a continuation of the
  448  employment relationship, except that a leave of absence without
  449  pay due to disability may constitute termination if such member
  450  makes application for and is approved for disability retirement
  451  in accordance with s. 121.091(4). The department or state board
  452  may require other evidence of termination as it deems necessary.
  453         (b) “Termination” for a member electing to participate in
  454  the Deferred Retirement Option Program occurs when the program
  455  participant ceases all employment relationships with
  456  participating employers an employer in accordance with s.
  457  121.091(13), however:
  458         1. For termination dates occurring before July 1, 2010, if
  459  the member participant is employed by any such employer within
  460  the next calendar month, termination will be deemed not to have
  461  occurred, except as provided in s. 121.091(13)(b)4.c. A leave of
  462  absence shall constitute a continuation of the employment
  463  relationship.
  464         2. For termination dates occurring on or after July 1,
  465  2010, if the member participant becomes employed by any such
  466  employer within the next 6 calendar months, termination will be
  467  deemed not to have occurred, except as provided in s.
  468  121.091(13)(b)4.c. A leave of absence constitutes a continuation
  469  of the employment relationship.
  470         (c) Effective July 1, 2011, “termination” for a member
  471  receiving a refund of employee contributions occurs when a
  472  member ceases all employment relationships with participating
  473  employers for 3 calendar months. A leave of absence constitutes
  474  a continuation of the employment relationship.
  475         (45)(a) “Vested” or “vesting” means the guarantee that a
  476  member is eligible to receive a future retirement benefit upon
  477  completion of the required years of creditable service for the
  478  employee’s class of membership, even though the member may have
  479  terminated covered employment before reaching normal or early
  480  retirement date. Being vested does not entitle a member to a
  481  disability benefit. Provisions governing entitlement to
  482  disability benefits are set forth under s. 121.091(4).
  483         (a)(b) Effective July 1, 2001, through June 30, 2011, a 6
  484  year vesting requirement shall be implemented for the defined
  485  benefit program of the Florida Retirement System Pension Plan
  486  System. Pursuant thereto:
  487         1. Any member employed in a regularly established position
  488  on July 1, 2001, who completes or has completed a total of 6
  489  years of creditable service is shall be considered vested as
  490  described in paragraph (a).
  491         2. Any member not employed in a regularly established
  492  position on July 1, 2001, shall be deemed vested upon completion
  493  of 6 years of creditable service if, provided that such member
  494  is employed in a covered position for at least 1 work year after
  495  July 1, 2001. However, a no member is not shall be required to
  496  complete more years of creditable service than would have been
  497  required for that member to vest under retirement laws in effect
  498  before July 1, 2001.
  499         3. Any member initially enrolled in the Florida Retirement
  500  System on July 1, 2001, through June 30, 2011, shall be deemed
  501  vested upon completion of 6 years of creditable service.
  502         (b) Any member initially enrolled in the Florida Retirement
  503  System on or after July 1, 2011, shall be vested upon completion
  504  of 8 years of creditable service.
  505         (55) “Benefit” means any pension payment, lump-sum or
  506  periodic, to a member, retiree, or beneficiary, based partially
  507  or entirely on employer contributions or employee contributions,
  508  if applicable.
  509         (59) “Payee” means a retiree or beneficiary of a retiree
  510  who has received or is receiving a retirement benefit payment.
  511         Section 7. Paragraphs (b) and (c) of subsection (2) and
  512  subsection (3) of section 121.051, Florida Statutes, are amended
  513  to read:
  514         121.051 Participation in the system.—
  515         (2) OPTIONAL PARTICIPATION.—
  516         (b)1. The governing body of any municipality, metropolitan
  517  planning organization, or special district in the state may
  518  elect to participate in the Florida Retirement System upon
  519  proper application to the administrator and may cover all or any
  520  of its units as approved by the Secretary of Health and Human
  521  Services and the administrator. The department shall adopt rules
  522  establishing procedures provisions for the submission of
  523  documents necessary for such application. Before Prior to being
  524  approved for participation in the Florida Retirement system, the
  525  governing body of a any such municipality, metropolitan planning
  526  organization, or special district that has a local retirement
  527  system must shall submit to the administrator a certified
  528  financial statement showing the condition of the local
  529  retirement system as of a date within 3 months before prior to
  530  the proposed effective date of membership in the Florida
  531  Retirement System. The statement must be certified by a
  532  recognized accounting firm that is independent of the local
  533  retirement system. All required documents necessary for
  534  extending Florida Retirement System coverage must be received by
  535  the department for consideration at least 15 days before prior
  536  to the proposed effective date of coverage. If the municipality,
  537  metropolitan planning organization, or special district does not
  538  comply with this requirement, the department may require that
  539  the effective date of coverage be changed.
  540         2. A municipality Any city, metropolitan planning
  541  organization, or special district that has an existing
  542  retirement system covering the employees in the units that are
  543  to be brought under the Florida Retirement System may
  544  participate only after holding a referendum in which all
  545  employees in the affected units have the right to participate.
  546  Only those employees electing coverage under the Florida
  547  Retirement System by affirmative vote in the said referendum are
  548  shall be eligible for coverage under this chapter, and those not
  549  participating or electing not to be covered by the Florida
  550  Retirement System shall remain in their present systems and are
  551  shall not be eligible for coverage under this chapter. After the
  552  referendum is held, all future employees are shall be compulsory
  553  members of the Florida Retirement System.
  554         3. At the time of joining the Florida Retirement System,
  555  the governing body of a municipality any city, metropolitan
  556  planning organization, or special district complying with
  557  subparagraph 1. may elect to provide, or not provide, benefits
  558  based on past service of officers and employees as described in
  559  s. 121.081(1). However, if such employer elects to provide past
  560  service benefits, such benefits must be provided for all
  561  officers and employees of its covered group.
  562         4. Once this election is made and approved it may not be
  563  revoked, except pursuant to subparagraphs 5. and 6., and all
  564  present officers and employees electing coverage under this
  565  chapter and all future officers and employees are shall be
  566  compulsory members of the Florida Retirement System.
  567         5. Subject to the conditions set forth in subparagraph 6.,
  568  the governing body of a any hospital licensed under chapter 395
  569  which is governed by the board of a special district as defined
  570  in s. 189.403(1) or by the board of trustees of a public health
  571  trust created under s. 154.07, hereinafter referred to as
  572  “hospital district,” and which participates in the Florida
  573  Retirement System, may elect to cease participation in the
  574  system with regard to future employees in accordance with the
  575  following procedure:
  576         a. No more than 30 days and at least 7 days before adopting
  577  a resolution to partially withdraw from the Florida Retirement
  578  system and establish an alternative retirement plan for future
  579  employees, a public hearing must be held on the proposed
  580  withdrawal and proposed alternative plan.
  581         b. From 7 to 15 days before such hearing, notice of intent
  582  to withdraw, specifying the time and place of the hearing, must
  583  be provided in writing to employees of the hospital district
  584  proposing partial withdrawal and must be published in a
  585  newspaper of general circulation in the area affected, as
  586  provided by ss. 50.011-50.031. Proof of publication must of such
  587  notice shall be submitted to the Department of Management
  588  Services.
  589         c. The governing body of a any hospital district seeking to
  590  partially withdraw from the system must, before such hearing,
  591  have an actuarial report prepared and certified by an enrolled
  592  actuary, as defined in s. 112.625(3), illustrating the cost to
  593  the hospital district of providing, through the retirement plan
  594  that the hospital district is to adopt, benefits for new
  595  employees comparable to those provided under the Florida
  596  Retirement system.
  597         d. Upon meeting all applicable requirements of this
  598  subparagraph, and subject to the conditions set forth in
  599  subparagraph 6., partial withdrawal from the system and adoption
  600  of the alternative retirement plan may be accomplished by
  601  resolution duly adopted by the hospital district board. The
  602  hospital district board must provide written notice of such
  603  withdrawal to the division by mailing a copy of the resolution
  604  to the division, postmarked by no later than December 15, 1995.
  605  The withdrawal shall take effect January 1, 1996.
  606         6. Following the adoption of a resolution under sub
  607  subparagraph 5.d., all employees of the withdrawing hospital
  608  district who were members of participants in the Florida
  609  Retirement system before prior to January 1, 1996, shall remain
  610  as members of participants in the system for as long as they are
  611  employees of the hospital district, and all rights, duties, and
  612  obligations between the hospital district, the system, and the
  613  employees shall remain in full force and effect. Any employee
  614  who is hired or appointed on or after January 1, 1996, may not
  615  participate in the Florida Retirement system, and the
  616  withdrawing hospital district has shall have no obligation to
  617  the system with respect to such employees.
  618         (c) Employees of public community colleges or charter
  619  technical career centers sponsored by public community colleges,
  620  designated in s. 1000.21(3), who are members of the Regular
  621  Class of the Florida Retirement System and who comply with the
  622  criteria set forth in this paragraph and s. 1012.875 may, in
  623  lieu of participating in the Florida Retirement System, elect to
  624  withdraw from the system altogether and participate in the State
  625  Community College System Optional Retirement Program provided by
  626  the employing agency under s. 1012.875.
  627         1.a. Through June 30, 2001, the cost to the employer for
  628  benefits under the optional retirement program such annuity
  629  equals the normal cost portion of the employer retirement
  630  contribution which would be required if the employee were a
  631  member of the pension plan’s Regular Class defined benefit
  632  program, plus the portion of the contribution rate required by
  633  s. 112.363(8) which would otherwise be assigned to the Retiree
  634  Health Insurance Subsidy Trust Fund.
  635         b. Effective July 1, 2001, through June 30, 2011, each
  636  employer shall contribute on behalf of each member of
  637  participant in the optional program an amount equal to 10.43
  638  percent of the employee’s participant’s gross monthly
  639  compensation. The employer shall deduct an amount for the
  640  administration of the program.
  641         c. Effective July 1, 2011, each member shall contribute an
  642  amount equal to the employee contribution required under s.
  643  121.71(3). The employer shall contribute on behalf of each
  644  program member an amount equal to the difference between 10.43
  645  percent of the employee’s gross monthly compensation and the
  646  employee’s required contribution based on the employee’s gross
  647  monthly compensation.
  648         d. The employer shall contribute an additional amount to
  649  the Florida Retirement System Trust Fund equal to the unfunded
  650  actuarial accrued liability portion of the Regular Class
  651  contribution rate.
  652         2. The decision to participate in the an optional
  653  retirement program is irrevocable as long as the employee holds
  654  a position eligible for participation, except as provided in
  655  subparagraph 3. Any service creditable under the Florida
  656  Retirement System is retained after the member withdraws from
  657  the system; however, additional service credit in the system may
  658  not be earned while a member of the optional retirement program.
  659         3. An employee who has elected to participate in the
  660  optional retirement program shall have one opportunity, at the
  661  employee’s discretion, to transfer from the optional retirement
  662  program to the pension plan defined benefit program of the
  663  Florida Retirement System or to the investment plan established
  664  under part II of this chapter Public Employee Optional
  665  Retirement Program, subject to the terms of the applicable
  666  optional retirement program contracts.
  667         a. If the employee chooses to move to the investment plan
  668  Public Employee Optional Retirement Program, any contributions,
  669  interest, and earnings creditable to the employee under the
  670  State Community College System optional retirement program are
  671  retained by the employee in the State Community College System
  672  optional retirement program, and the applicable provisions of s.
  673  121.4501(4) govern the election.
  674         b. If the employee chooses to move to the pension plan
  675  defined benefit program of the Florida Retirement System, the
  676  employee shall receive service credit equal to his or her years
  677  of service under the State Community College System optional
  678  retirement program.
  679         (I) The cost for such credit is the amount representing the
  680  present value of the employee’s accumulated benefit obligation
  681  for the affected period of service. The cost shall be calculated
  682  as if the benefit commencement occurs on the first date the
  683  employee becomes eligible for unreduced benefits, using the
  684  discount rate and other relevant actuarial assumptions that were
  685  used to value the Florida Retirement System Pension defined
  686  benefit Plan liabilities in the most recent actuarial valuation.
  687  The calculation must include any service already maintained
  688  under the pension defined benefit plan in addition to the years
  689  under the State Community College System optional retirement
  690  program. The present value of any service already maintained
  691  must be applied as a credit to total cost resulting from the
  692  calculation. The division shall ensure that the transfer sum is
  693  prepared using a formula and methodology certified by an
  694  enrolled actuary.
  695         (II) The employee must transfer from his or her State
  696  Community College System optional retirement program account and
  697  from other employee moneys as necessary, a sum representing the
  698  present value of the employee’s accumulated benefit obligation
  699  immediately following the time of such movement, determined
  700  assuming that attained service equals the sum of service in the
  701  pension plan defined benefit program and service in the State
  702  Community College System optional retirement program.
  703         4. Participation in the optional retirement program is
  704  limited to employees who satisfy the following eligibility
  705  criteria:
  706         a. The employee is must be otherwise eligible for
  707  membership or renewed membership in the Regular Class of the
  708  Florida Retirement System, as provided in s. 121.021(11) and
  709  (12) or s. 121.122.
  710         b. The employee is must be employed in a full-time position
  711  classified in the Accounting Manual for Florida’s Public
  712  Community Colleges as:
  713         (I) Instructional; or
  714         (II) Executive Management, Instructional Management, or
  715  Institutional Management and the, if a community college
  716  determines that recruiting to fill a vacancy in the position is
  717  to be conducted in the national or regional market, and the
  718  duties and responsibilities of the position include the
  719  formulation, interpretation, or implementation of policies, or
  720  the performance of functions that are unique or specialized
  721  within higher education and that frequently support the mission
  722  of the community college.
  723         c. The employee is must be employed in a position not
  724  included in the Senior Management Service Class of the Florida
  725  Retirement System, as described in s. 121.055.
  726         5. Members of Participants in the program are subject to
  727  the same reemployment limitations, renewed membership
  728  provisions, and forfeiture provisions as are applicable to
  729  regular members of the Florida Retirement System under ss.
  730  121.091(9), 121.122, and 121.091(5), respectively. A member
  731  participant who receives a program distribution funded by
  732  employer and required employee contributions is shall be deemed
  733  to be retired from a state-administered retirement system if the
  734  member participant is subsequently employed with an employer
  735  that participates in the Florida Retirement System.
  736         6. Eligible community college employees are compulsory
  737  members of the Florida Retirement System until, pursuant to s.
  738  1012.875, a written election to withdraw from the system and
  739  participate in the State Community College System optional
  740  retirement program is filed with the program administrator and
  741  received by the division.
  742         a. A community college employee whose program eligibility
  743  results from initial employment shall must be enrolled in the
  744  State Community College System optional retirement program
  745  retroactive to the first day of eligible employment. The
  746  employer and employee retirement contributions paid through the
  747  month of the employee plan change shall be transferred to the
  748  community college to the employee’s optional program account,
  749  and, effective the first day of the next month, the employer
  750  shall pay the applicable contributions based upon subparagraph
  751  1.
  752         b. A community college employee whose program eligibility
  753  is due to the subsequent designation of the employee’s position
  754  as one of those specified in subparagraph 4., or due to the
  755  employee’s appointment, promotion, transfer, or reclassification
  756  to a position specified in subparagraph 4., must be enrolled in
  757  the program on the first day of the first full calendar month
  758  that such change in status becomes effective. The employer and
  759  employee retirement contributions paid from the effective date
  760  through the month of the employee plan change must be
  761  transferred to the community college to the employee’s optional
  762  program account, and, effective the first day of the next month,
  763  the employer shall pay the applicable contributions based upon
  764  subparagraph 1.
  765         7. Effective July 1, 2003, through December 31, 2008, any
  766  member participant of the State Community College System
  767  optional retirement program who has service credit in the
  768  pension defined benefit plan of the Florida Retirement System
  769  for the period between his or her first eligibility to transfer
  770  from the pension defined benefit plan to the optional retirement
  771  program and the actual date of transfer may, during employment,
  772  transfer to the optional retirement program a sum representing
  773  the present value of the accumulated benefit obligation under
  774  the defined benefit retirement program for the period of service
  775  credit. Upon transfer, all service credit previously earned
  776  under the pension plan defined benefit program of the Florida
  777  Retirement System during this period is nullified for purposes
  778  of entitlement to a future benefit under the pension plan
  779  defined benefit program of the Florida Retirement System.
  780         (3) SOCIAL SECURITY COVERAGE.—Social security coverage
  781  shall be provided for all officers and employees who become
  782  members under the provisions of subsection (1) or subsection
  783  (2). Any modification of the present agreement with the Social
  784  Security Administration, or referendum required under the Social
  785  Security Act, for the purpose of providing social security
  786  coverage for any member shall be requested by the state agency
  787  in compliance with the applicable provisions of the Social
  788  Security Act governing such coverage. However, retroactive
  789  social security coverage for service before prior to December 1,
  790  1970, with the employer may shall not be provided for a any
  791  member who was not covered under the agreement as of November
  792  30, 1970. The employer-paid employee contributions specified in
  793  s. 121.71(3) are subject to taxes imposed under the Federal
  794  Insurance Contributions Act, 26 U.S.C. ss. 3101-3128.
  795         Section 8. Section 121.0515, Florida Statutes, is amended
  796  to read:
  797         121.0515 Special Risk Class membership.—
  798         (1) ESTABLISHMENT OF CLASS LEGISLATIVE INTENT.—A separate
  799  In creating the Special Risk class of membership within the
  800  Florida Retirement System, to be known as the “Special Risk
  801  Class,” is established it is the intent and purpose of the
  802  Legislature to recognize that persons employed in certain
  803  categories of law enforcement, firefighting, criminal detention,
  804  and emergency medical care positions are required as one of the
  805  essential functions of their positions to perform work that is
  806  physically demanding or arduous, or work that requires
  807  extraordinary agility and mental acuity, and that such persons,
  808  because of diminishing physical and mental faculties, may find
  809  that they are not able, without risk to the health and safety of
  810  themselves, the public, or their coworkers, to continue
  811  performing such duties and thus enjoy the full career and
  812  retirement benefits enjoyed by persons employed in other
  813  membership classes positions and that, if they find it
  814  necessary, due to the physical and mental limitations of their
  815  age, to retire at an earlier age and usually with less service,
  816  they will suffer an economic deprivation therefrom. To address
  817  Therefore, as a means of recognizing the peculiar and special
  818  problems of this class of employees, it is the intent and
  819  purpose of the Legislature to establish a class of retirement
  820  membership is established that awards more retirement credit per
  821  year of service than that awarded to other employees; however,
  822  nothing contained herein shall require ineligibility for Special
  823  Risk Class membership upon reaching age 55.
  824         (2) MEMBERSHIP.—
  825         (a) Until October 1, 1978, “special risk member” means any
  826  officer or employee whose application is approved by the
  827  administrator and who receives salary payments for work
  828  performed as a peace officer; law enforcement officer; police
  829  officer; highway patrol officer; custodial employee at a
  830  correctional or detention facility; correctional agency employee
  831  whose duties and responsibilities involve direct contact with
  832  inmates, but excluding secretarial and clerical employees;
  833  firefighter; or an employee in any other job in the field of law
  834  enforcement or fire protection if the duties of such person are
  835  certified as hazardous by his or her employer.
  836         (b) Effective October 1, 1978, through September 30, 1999,
  837  “special risk member” means a member of the Florida Retirement
  838  System who is designated as a special risk member by the
  839  division in accordance with this section. Such member must be
  840  employed as a law enforcement officer, a firefighter, or a
  841  correctional officer and must meet certain other special
  842  criteria as set forth in this section.
  843         (c) Effective October 1, 1999, “special risk member” means
  844  a member of the Florida Retirement System who is designated as a
  845  special risk member by the division in accordance with this
  846  section. Such member must be employed as a law enforcement
  847  officer, a firefighter, a correctional officer, an emergency
  848  medical technician, or a paramedic and must meet certain other
  849  special criteria as set forth in this section.
  850         (d) Effective January 1, 2001, “special risk member”
  851  includes:
  852         1. Any member who is employed as a community-based
  853  correctional probation officer and meets the special criteria
  854  set forth in paragraph (3)(e).
  855         2. Any professional health care bargaining unit or non-unit
  856  member who is employed by the Department of Corrections or the
  857  Department of Children and Family Services and meets the special
  858  criteria set forth in paragraph (3)(f).
  859         (e) Effective July 1, 2001, “special risk member” includes
  860  any member who is employed as a youth custody officer by the
  861  Department of Juvenile Justice and meets the special criteria
  862  set forth in paragraph (3)(g).
  863         (f) Effective October 1, 2005, through June 30, 2008, the
  864  member must be employed by a law enforcement agency or medical
  865  examiner’s office in a forensic discipline and meet the special
  866  criteria set forth in paragraph (3)(h).
  867         (g) Effective July 1, 2008, the member must be employed by
  868  the Department of Law Enforcement in the crime laboratory or by
  869  the Division of State Fire Marshal in the forensic laboratory
  870  and meet the special criteria set forth in paragraph (3)(i).
  871         (h) Effective July 1, 2008, the member must be employed by
  872  a local government law enforcement agency or medical examiner’s
  873  office and meet the special criteria set forth in paragraph
  874  (3)(j).
  875         (i) Effective August 1, 2008, “special risk member”
  876  includes any member who meets the special criteria for continued
  877  membership set forth in paragraph (3)(k).
  878         (3)(2) CRITERIA.—A member, to be designated as a special
  879  risk member, must meet the following criteria:
  880         (a) Effective October 1, 1978, the member must be employed
  881  as a law enforcement officer and be certified, or required to be
  882  certified, in compliance with s. 943.1395; however, sheriffs and
  883  elected police chiefs are shall be excluded from meeting the
  884  certification requirements of this paragraph. In addition, the
  885  member’s duties and responsibilities must include the pursuit,
  886  apprehension, and arrest of law violators or suspected law
  887  violators; or as of July 1, 1982, the member must be an active
  888  member of a bomb disposal unit whose primary responsibility is
  889  the location, handling, and disposal of explosive devices; or
  890  the member must be the supervisor or command officer of a member
  891  or members who have such responsibilities.; provided, however,
  892  Administrative support personnel, including, but not limited to,
  893  those whose primary duties and responsibilities are in
  894  accounting, purchasing, legal, and personnel, are shall not be
  895  included;
  896         (b) Effective October 1, 1978, the member must be employed
  897  as a firefighter and be certified, or required to be certified,
  898  in compliance with s. 633.35 and be employed solely within the
  899  fire department of a local government employer or an agency of
  900  state government with firefighting responsibilities. In
  901  addition, the member’s duties and responsibilities must include
  902  on-the-scene fighting of fires; as of October 1, 2001, fire
  903  prevention, or firefighter training; as of October 1, 2001,
  904  direct supervision of firefighting units, fire prevention, or
  905  firefighter training; or as of July 1, 2001, aerial firefighting
  906  surveillance performed by fixed-wing aircraft pilots employed by
  907  the Division of Forestry of the Department of Agriculture and
  908  Consumer Services; or the member must be the supervisor or
  909  command officer of a member or members who have such
  910  responsibilities.; provided, however, Administrative support
  911  personnel, including, but not limited to, those whose primary
  912  duties and responsibilities are in accounting, purchasing,
  913  legal, and personnel, are shall not be included. and further
  914  provided that All periods of creditable service in fire
  915  prevention or firefighter training, or as the supervisor or
  916  command officer of a member or members who have such
  917  responsibilities, and for which the employer paid the special
  918  risk contribution rate, are shall be included;
  919         (c) Effective October 1, 1978, the member must be employed
  920  as a correctional officer and be certified, or required to be
  921  certified, in compliance with s. 943.1395. In addition, the
  922  member’s primary duties and responsibilities must be the
  923  custody, and physical restraint when necessary, of prisoners or
  924  inmates within a prison, jail, or other criminal detention
  925  facility, or while on work detail outside the facility, or while
  926  being transported; or as of July 1, 1984, the member must be the
  927  supervisor or command officer of a member or members who have
  928  such responsibilities.; provided, however, Administrative
  929  support personnel, including, but not limited to, those whose
  930  primary duties and responsibilities are in accounting,
  931  purchasing, legal, and personnel, are shall not be included;
  932  however, wardens and assistant wardens, as defined by rule, are
  933  included shall participate in the Special Risk Class;
  934         (d) Effective October 1, 1999, the member must be employed
  935  by a licensed Advance Life Support (ALS) or Basic Life Support
  936  (BLS) employer as an emergency medical technician or a paramedic
  937  and be certified in compliance with s. 401.27. In addition, the
  938  member’s primary duties and responsibilities must include on
  939  the-scene emergency medical care or as of October 1, 2001,
  940  direct supervision of emergency medical technicians or
  941  paramedics, or the member must be the supervisor or command
  942  officer of one or more members who have such responsibility.
  943  However, Administrative support personnel, including, but not
  944  limited to, those whose primary responsibilities are in
  945  accounting, purchasing, legal, and personnel, are shall not be
  946  included;
  947         (e) Effective January 1, 2001, the member must be employed
  948  as a community-based correctional probation officer and be
  949  certified, or required to be certified, in compliance with s.
  950  943.1395. In addition, the member’s primary duties and
  951  responsibilities must be the supervised custody, surveillance,
  952  control, investigation, and counseling of assigned inmates,
  953  probationers, parolees, or community controllees within the
  954  community; or the member must be the supervisor of a member or
  955  members who have such responsibilities. Administrative support
  956  personnel, including, but not limited to, those whose primary
  957  duties and responsibilities are in accounting, purchasing, legal
  958  services, and personnel management, are shall not be included;
  959  however, probation and parole circuit and deputy circuit
  960  administrators are included shall participate in the Special
  961  Risk Class;
  962         (f) Effective January 1, 2001, the member must be employed
  963  in one of the following classes and must spend at least 75
  964  percent of his or her time performing duties which involve
  965  contact with patients or inmates in a correctional or forensic
  966  facility or institution:
  967         1. Dietitian (class codes 5203 and 5204);
  968         2. Public health nutrition consultant (class code 5224);
  969         3. Psychological specialist (class codes 5230 and 5231);
  970         4. Psychologist (class code 5234);
  971         5. Senior psychologist (class codes 5237 and 5238);
  972         6. Regional mental health consultant (class code 5240);
  973         7. Psychological Services Director—DCF (class code 5242);
  974         8. Pharmacist (class codes 5245 and 5246);
  975         9. Senior pharmacist (class codes 5248 and 5249);
  976         10. Dentist (class code 5266);
  977         11. Senior dentist (class code 5269);
  978         12. Registered nurse (class codes 5290 and 5291);
  979         13. Senior registered nurse (class codes 5292 and 5293);
  980         14. Registered nurse specialist (class codes 5294 and
  981  5295);
  982         15. Clinical associate (class codes 5298 and 5299);
  983         16. Advanced registered nurse practitioner (class codes
  984  5297 and 5300);
  985         17. Advanced registered nurse practitioner specialist
  986  (class codes 5304 and 5305);
  987         18. Registered nurse supervisor (class codes 5306 and
  988  5307);
  989         19. Senior registered nurse supervisor (class codes 5308
  990  and 5309);
  991         20. Registered nursing consultant (class codes 5312 and
  992  5313);
  993         21. Quality management program supervisor (class code
  994  5314);
  995         22. Executive nursing director (class codes 5320 and 5321);
  996         23. Speech and hearing therapist (class code 5406); or
  997         24. Pharmacy manager (class code 5251);
  998         (g) Effective July 1, 2001, the member must be employed as
  999  a youth custody officer and be certified, or required to be
 1000  certified, in compliance with s. 943.1395. In addition, the
 1001  member’s primary duties and responsibilities must be the
 1002  supervised custody, surveillance, control, investigation,
 1003  apprehension, arrest, and counseling of assigned juveniles
 1004  within the community;
 1005         (h) Effective October 1, 2005, through June 30, 2008, the
 1006  member must be employed by a law enforcement agency or medical
 1007  examiner’s office in a forensic discipline recognized by the
 1008  International Association for Identification and must qualify
 1009  for active membership in the International Association for
 1010  Identification. The member’s primary duties and responsibilities
 1011  must include the collection, examination, preservation,
 1012  documentation, preparation, or analysis of physical evidence or
 1013  testimony, or both, or the member must be the direct supervisor,
 1014  quality management supervisor, or command officer of one or more
 1015  individuals with such responsibility. Administrative support
 1016  personnel, including, but not limited to, those whose primary
 1017  responsibilities are clerical or in accounting, purchasing,
 1018  legal, and personnel, are shall not be included;
 1019         (i) Effective July 1, 2008, the member must be employed by
 1020  the Department of Law Enforcement in the crime laboratory or by
 1021  the Division of State Fire Marshal in the forensic laboratory in
 1022  one of the following classes:
 1023         1. Forensic technologist (class code 8459);
 1024         2. Crime laboratory technician (class code 8461);
 1025         3. Crime laboratory analyst (class code 8463);
 1026         4. Senior crime laboratory analyst (class code 8464);
 1027         5. Crime laboratory analyst supervisor (class code 8466);
 1028         6. Forensic chief (class code 9602); or
 1029         7. Forensic services quality manager (class code 9603);
 1030         (j) Effective July 1, 2008, the member must be employed by
 1031  a local government law enforcement agency or medical examiner’s
 1032  office and must spend at least 65 percent of his or her time
 1033  performing duties that involve the collection, examination,
 1034  preservation, documentation, preparation, or analysis of human
 1035  tissues or fluids or physical evidence having potential
 1036  biological, chemical, or radiological hazard or contamination,
 1037  or use chemicals, processes, or materials that may have
 1038  carcinogenic or health-damaging properties in the analysis of
 1039  such evidence, or the member must be the direct supervisor of
 1040  one or more individuals having such responsibility. If a special
 1041  risk member changes to another position within the same agency,
 1042  he or she must submit a complete application as provided in
 1043  paragraph (4)(3)(a); or
 1044         (k) The member must have already qualified for and be
 1045  actively participating in special risk membership under
 1046  paragraph (a), paragraph (b), or paragraph (c), must have
 1047  suffered a qualifying injury as defined in this paragraph, must
 1048  not be receiving disability retirement benefits as provided in
 1049  s. 121.091(4), and must satisfy the requirements of this
 1050  paragraph.
 1051         1. The ability to qualify for the class of membership
 1052  defined in paragraph (2)(f) occurs s. 121.021(15)(f) shall occur
 1053  when two licensed medical physicians, one of whom is a primary
 1054  treating physician of the member, certify the existence of the
 1055  physical injury and medical condition that constitute a
 1056  qualifying injury as defined in this paragraph and that the
 1057  member has reached maximum medical improvement after August 1,
 1058  2008. The certifications from the licensed medical physicians
 1059  must include, at a minimum, that the injury to the special risk
 1060  member has resulted in a physical loss, or loss of use, of at
 1061  least two of the following: left arm, right arm, left leg, or
 1062  right leg; and:
 1063         a. That this physical loss or loss of use is total and
 1064  permanent, except in the event that the loss of use is due to a
 1065  physical injury to the member’s brain, in which event the loss
 1066  of use is permanent with at least 75-percent loss of motor
 1067  function with respect to each arm or leg affected.
 1068         b. That this physical loss or loss of use renders the
 1069  member physically unable to perform the essential job functions
 1070  of his or her special risk position.
 1071         c. That, notwithstanding this physical loss or loss of use,
 1072  the individual is able to perform the essential job functions
 1073  required by the member’s new position, as provided in
 1074  subparagraph 3.
 1075         d. That use of artificial limbs is either not possible or
 1076  does not alter the member’s ability to perform the essential job
 1077  functions of the member’s position.
 1078         e. That the physical loss or loss of use is a direct result
 1079  of a physical injury and not a result of any mental,
 1080  psychological, or emotional injury.
 1081         2. For the purposes of this paragraph, “qualifying injury”
 1082  means an injury sustained in the line of duty, as certified by
 1083  the member’s employing agency, by a special risk member that
 1084  does not result in total and permanent disability as defined in
 1085  s. 121.091(4)(b). An injury is a qualifying injury if when the
 1086  injury is a physical injury to the member’s physical body
 1087  resulting in a physical loss, or loss of use, of at least two of
 1088  the following: left arm, right arm, left leg, or right leg.
 1089  Notwithstanding any other provision of anything in this section
 1090  to the contrary, an injury that would otherwise qualify as a
 1091  qualifying injury is shall not be considered a qualifying injury
 1092  if and when the member ceases employment with the employer for
 1093  whom he or she was providing special risk services on the date
 1094  the injury occurred.
 1095         3. The new position, as described in sub-subparagraph 1.c.,
 1096  that is required for qualification as a special risk member
 1097  under this paragraph is not required to be a position with
 1098  essential job functions that entitle an individual to special
 1099  risk membership. Whether a new position as described in sub
 1100  subparagraph 1.c. exists and is available to the special risk
 1101  member is a decision to be made solely by the employer in
 1102  accordance with its hiring practices and applicable law.
 1103         4. This paragraph does not grant or create additional
 1104  rights for any individual to continued employment or to be hired
 1105  or rehired by his or her employer that are not already provided
 1106  within the Florida Statutes, the State Constitution, the
 1107  Americans with Disabilities Act, if applicable, or any other
 1108  applicable state or federal law.
 1109         (4)(3) PROCEDURE FOR DESIGNATING.—
 1110         (a) Any member of the Florida Retirement System employed by
 1111  a county, municipality city, or special district who feels that
 1112  his or her position he or she meets the criteria set forth in
 1113  this section for membership in the Special Risk Class may
 1114  request that his or her employer submit an application to the
 1115  department requesting that the department designate him or her
 1116  as a Special Risk member. If the employer agrees that the member
 1117  meets the requirements for Special Risk Class membership, the
 1118  employer shall submit an application to the department on in
 1119  behalf of the employee containing a certification that the
 1120  member meets the criteria for Special Risk Class membership set
 1121  forth in this section and such other supporting documentation as
 1122  may be required by administrative rule. The department shall,
 1123  within 90 days, either designate or refuse to designate the
 1124  member as a special risk member. If the employer declines to
 1125  submit the member’s application to the department or if the
 1126  department does not designate the member as a special risk
 1127  member, the member or the employer may appeal to the State
 1128  Retirement Commission, as provided in s. 121.23, for designation
 1129  as a special risk member. A member who receives a final
 1130  affirmative ruling pursuant to such appeal for Special Risk
 1131  membership shall have Special Risk Class membership retroactive
 1132  to the date such member would have had Special Risk Class
 1133  membership had such membership been approved by the employer and
 1134  the department, as determined by the department, and the
 1135  employer contributions shall be paid in full within 1 year after
 1136  such final ruling.
 1137         (b)1. Applying the criteria set forth in this section, the
 1138  department of Management Services shall specify which current
 1139  and newly created classes of positions under the uniform
 1140  classification plan established pursuant to chapter 110 entitle
 1141  the incumbents of positions in those classes to membership in
 1142  the Special Risk Class. Only employees employed in the classes
 1143  so specified shall be special risk members.
 1144         2.If When a class is not specified by the department as
 1145  provided in subparagraph 1., the employing agency may petition
 1146  the State Retirement Commission for approval in accordance with
 1147  s. 121.23.
 1148         (5)(4) REMOVAL OF SPECIAL RISK CLASS MEMBERSHIP.—
 1149         (a) Any member who is a special risk member on October 1,
 1150  1978, and who fails to meet the criteria for Special Risk Class
 1151  membership established by this section shall have his or her
 1152  special risk designation removed and thereafter shall be a
 1153  regular member and shall earn only regular membership credit.
 1154  The department may shall have the authority to review the
 1155  special risk designation of members to determine whether or not
 1156  those members continue to meet the criteria for Special Risk
 1157  Class membership.
 1158         (b) Any member who is a special risk member on July 1,
 1159  2008, and who became eligible to participate under paragraph
 1160  (3)(2)(h) but fails to meet the criteria for Special Risk Class
 1161  membership established by paragraph (3)(2)(i) or paragraph
 1162  (3)(2)(j) shall have his or her special risk designation removed
 1163  and thereafter shall be a Regular Class member and earn only
 1164  Regular Class membership credit. The department may review the
 1165  special risk designation of members to determine whether or not
 1166  those members continue to meet the criteria for Special Risk
 1167  Class membership.
 1168         (6)(5) CREDIT FOR PAST SERVICE.—A special risk member may
 1169  purchase retirement credit in the Special Risk Class based upon
 1170  past service, and may upgrade retirement credit for such past
 1171  service, to the extent of 2 percent of the member’s average
 1172  monthly compensation as specified in s. 121.091(1)(a) for such
 1173  service as follows:
 1174         (a) The member may purchase special risk credit for past
 1175  service with a municipality city or special district which has
 1176  elected to join the Florida Retirement System, or with a
 1177  participating agency to which a member’s governmental unit was
 1178  transferred, merged, or consolidated as provided in s.
 1179  121.081(1)(f), if the member was employed with the municipality
 1180  city or special district at the time it commenced participating
 1181  in the Florida Retirement System or with the governmental unit
 1182  at the time of its transfer, merger, or consolidation with the
 1183  participating agency. The service must satisfy the criteria set
 1184  forth in subsection (3) (2) for Special Risk Class membership as
 1185  a law enforcement officer, firefighter, or correctional officer;
 1186  however, a no certificate or waiver of certificate of compliance
 1187  with s. 943.1395 or s. 633.35 is not shall be required for such
 1188  service.
 1189         (b) Contributions for upgrading the additional special risk
 1190  credit must pursuant to this subsection shall be equal to the
 1191  difference in the employer and, if applicable, employee
 1192  contributions paid and the special risk percentage rate of gross
 1193  salary in effect at the time of purchase for the period being
 1194  claimed, plus interest thereon at the rate of 4 percent a year
 1195  compounded annually from the date of such service until July 1,
 1196  1975, and 6.5 percent a year thereafter until the date of
 1197  payment. This past service may be purchased by the member or by
 1198  the employer on behalf of the member.
 1199         (7)(6) CREDIT FOR PRIOR SERVICE.—A special risk member who
 1200  has creditable service with an employer under chapter 122 or
 1201  chapter 321, or was employed as a correctional counselor with
 1202  the Department of Corrections between December 1, 1970, and
 1203  September 30, 1979, in a position that which satisfies the
 1204  criteria provided for in subsection (3) (2) for Special Risk
 1205  Class membership except the requirement for a certificate or
 1206  waiver of certificate, shall have those years of service counted
 1207  towards the attainment of the normal retirement date as a
 1208  special risk member under this chapter. The percentage value of
 1209  each such year of creditable service under chapter 122, chapter
 1210  321, or as a correctional counselor may shall not change as a
 1211  result of the application of this subsection. A special risk
 1212  member who has taken a refund of contributions for such
 1213  creditable service under chapter 122 or chapter 321 and has
 1214  reclaimed it as prior service credit under this chapter shall be
 1215  permitted to have such creditable service counted towards the
 1216  attainment of the normal retirement date for the Special Risk
 1217  Class of membership under this chapter.
 1218         (8)(7)SPECIAL RISK ADMINISTRATIVE SUPPORT CLASS RETENTION
 1219  OF SPECIAL RISK NORMAL RETIREMENT DATE.—
 1220         (a) A special risk member who is moved or reassigned to a
 1221  nonspecial risk law enforcement, firefighting, correctional, or
 1222  emergency medical care administrative support position with the
 1223  same agency, or who is subsequently employed in such a position
 1224  within with any law enforcement, firefighting, correctional, or
 1225  emergency medical care agency under the Florida Retirement
 1226  System, shall participate in the Special Risk Administrative
 1227  Support Class and shall earn credit for such service at the same
 1228  percentage rate as that earned by a regular member.
 1229  Notwithstanding the provisions of subsection (5) (4), service in
 1230  such an administrative support position shall, for purposes of
 1231  s. 121.091, applies apply toward satisfaction of the special
 1232  risk normal retirement date, as defined in s. 121.021(29)(b) if,
 1233  provided that, while in such position, the member remains
 1234  certified as a law enforcement officer, firefighter,
 1235  correctional officer, emergency medical technician, or
 1236  paramedic; remains subject to reassignment at any time to a
 1237  position qualifying for special risk membership; and completes
 1238  an aggregate of the 6 or more years of service as a designated
 1239  special risk member before prior to retirement which is equal to
 1240  or greater than the years of service required to be vested.
 1241         (b) Upon application by a member, the provisions of this
 1242  subsection shall apply, with respect to such member,
 1243  retroactively to October 1, 1978, if provided that the member
 1244  was removed from the Special Risk Class effective October 1,
 1245  1978, due to a change in special risk criteria as a result of
 1246  the enactment of chapter 78-308, Laws of Florida, or was
 1247  reassigned or employed for training or career development or to
 1248  fill a critical agency need.
 1249         (c) The department shall adopt such rules as are required
 1250  to administer this subsection.
 1251         (d) Notwithstanding any other provision of this subsection
 1252  to the contrary, this subsection does not apply to any special
 1253  risk member who qualifies for continued membership pursuant to
 1254  the provisions of paragraph (3)(2)(k).
 1255         (9)(8) RESTORATION OF SPECIAL RISK CREDIT FOR SPECIFIED
 1256  PERIOD OF EMPLOYMENT.—A special risk member who was removed from
 1257  the Special Risk Class effective October 1978, for the sole
 1258  reason that he or she did not possess the required certificate
 1259  or temporary waiver of certificate, and who obtained
 1260  certification and was approved for Special Risk Class membership
 1261  on or before June 30, 1982, may shall be permitted to have
 1262  special risk credit restored for that period upon:
 1263         (a) Certification by his or her employer that all
 1264  requirements for Special Risk Class membership except the
 1265  requirement for certification or temporary waiver of
 1266  certification were met; and
 1267         (b) Payment of contributions equal to the difference in the
 1268  contributions that were paid during the period and the
 1269  contributions required for special risk members during that
 1270  period, plus 6.5 percent interest thereon, compounded each June
 1271  30 from date of service until date of payment.
 1272  
 1273  This credit may be purchased by the member or by the employer on
 1274  behalf of the member.
 1275         (10)(9) CREDIT FOR UPGRADED SERVICE.—
 1276         (a) Any member of the Special Risk Class who has earned
 1277  creditable service through September 30, 1999, in another
 1278  membership class of the Florida Retirement System as an
 1279  emergency medical technician or paramedic, which service is
 1280  within the purview of the Special Risk Class, may purchase
 1281  additional retirement credit to upgrade such service to Special
 1282  Risk Class service, to the extent of the percentages of the
 1283  member’s average final compensation provided in s.
 1284  121.091(1)(a)2. Contributions for upgrading such service to
 1285  Special Risk Class credit must under this subsection shall be
 1286  equal to the difference in the contributions paid and the
 1287  Special Risk Class contribution rate as a percentage of gross
 1288  salary in effect for the period being claimed, plus interest
 1289  thereon at the rate of 6.5 percent a year, compounded annually
 1290  until the date of payment. This service credit may be purchased
 1291  by the employer on behalf of the member.
 1292         (b) Any member of the Special Risk Class who has earned
 1293  creditable service through September 30, 2001, in another
 1294  membership class of the Florida Retirement System whose
 1295  responsibilities included fire prevention or firefighter
 1296  training, which service is within the purview of the Special
 1297  Risk Class, may purchase additional retirement credit to upgrade
 1298  such service to Special Risk Class service, to the extent of the
 1299  percentages of the member’s average final compensation provided
 1300  in s. 121.091(1)(a)2. Contributions for upgrading such service
 1301  to Special Risk Class credit must under this subsection shall be
 1302  equal to the difference in the contributions paid and the
 1303  Special Risk Class contribution rate as a percentage of gross
 1304  salary in effect for the period being claimed, plus interest
 1305  thereon at the rate of 6.5 percent a year, compounded annually
 1306  until the date of payment. This service credit may be purchased
 1307  by the employer on behalf of the member.
 1308         (c) Any member of the Special Risk Class who has earned
 1309  creditable service through June 30, 2008, in another membership
 1310  class of the Florida Retirement System in a position with the
 1311  Department of Law Enforcement or the Division of State Fire
 1312  Marshal and became covered by the Special Risk Class as
 1313  described in paragraph (3)(2)(i), or with a local government law
 1314  enforcement agency or medical examiner’s office and became
 1315  covered by the Special Risk Class as described in paragraph
 1316  (3)(2)(j), which service is within the purview of the Special
 1317  Risk Class, and is employed in such position on or after July 1,
 1318  2008, may purchase additional retirement credit to upgrade such
 1319  service to Special Risk Class service, to the extent of the
 1320  percentages of the member’s average final compensation provided
 1321  in s. 121.091(1)(a)2. The cost for such credit must shall be an
 1322  amount representing the actuarial accrued liability for the
 1323  difference in accrual value during the affected period of
 1324  service. The cost shall be calculated using the discount rate
 1325  and other relevant actuarial assumptions that were used to value
 1326  the Florida Retirement System Pension defined benefit Plan
 1327  liabilities in the most recent actuarial valuation. The division
 1328  shall ensure that the transfer sum is prepared using a formula
 1329  and methodology certified by an enrolled actuary. The cost must
 1330  be paid immediately upon notification by the division. The local
 1331  government employer may purchase the upgraded service credit on
 1332  behalf of the member if the member has been employed by that
 1333  employer for at least 3 years.
 1334         Section 9. Paragraphs (a) and (d) of subsection (4),
 1335  paragraph (b) of subsection (7), and subsections (8) and (10) of
 1336  section 121.052, Florida Statutes, are amended, present
 1337  paragraph (c) of subsection (7) of that section is redesignated
 1338  as paragraph (d), and a new paragraph (c) is added to that
 1339  subsection, to read:
 1340         121.052 Membership class of elected officers.—
 1341         (4) PARTICIPATION BY ELECTED OFFICERS SERVING A SHORTENED
 1342  TERM DUE TO APPORTIONMENT, FEDERAL INTERVENTION, ETC.—
 1343         (a) A Any duly elected officer whose term of office was
 1344  shortened by legislative or judicial apportionment pursuant to
 1345  the provisions of s. 16, Art. III of the State Constitution may,
 1346  after the term of office to which he or she was elected is
 1347  completed, pay into the Florida Retirement System Trust Fund the
 1348  amount of contributions that would have been made by the officer
 1349  or the officer’s employer on his or her behalf, plus 4 percent
 1350  interest compounded annually from the date he or she left office
 1351  until July 1, 1975, and 6.5 percent interest compounded annually
 1352  thereafter, and may receive service credit for the length of
 1353  time the officer would have served if such term had not been
 1354  shortened by apportionment.
 1355         (d)1. Any justice or judge, or any retired justice or judge
 1356  who retired before July 1, 1993, who has attained the age of 70
 1357  years and who is prevented under s. 8, Art. V of the State
 1358  Constitution from completing his or her term of office because
 1359  of age may elect to purchase credit for all or a portion of the
 1360  months he or she would have served during the remainder of the
 1361  term of office; however, but he or she may claim those months
 1362  only after the date the service would have occurred. The justice
 1363  or judge must pay into the Florida Retirement System Trust Fund
 1364  the amount of contributions that would have been made by the
 1365  employer on his or her behalf for the period of time being
 1366  claimed, plus 6.5 percent interest thereon compounded each June
 1367  30 from the date he or she left office, in order to receive
 1368  service credit in this class for the period of time being
 1369  claimed. After the date the service would have occurred, and
 1370  upon payment of the required contributions, the retirement
 1371  benefit of a retired justice or judge shall will be adjusted
 1372  prospectively to include the this additional creditable service;
 1373  however, such adjustment may be made only once.
 1374         2. Any justice or judge who does not seek election to a
 1375  subsequent term of office because he or she would be prevented
 1376  under s. 8, Art. V of the State Constitution from completing
 1377  such term of office upon attaining the age of 70 years may elect
 1378  to purchase service credit for service as a temporary judge as
 1379  assigned by the court if the temporary assignment follows
 1380  immediately follows the last full term of office served and the
 1381  purchase is limited to the number of months of service needed to
 1382  vest retirement benefits. To receive retirement credit for such
 1383  temporary service beyond termination, the justice or judge must
 1384  pay into the Florida Retirement System Trust Fund the amount of
 1385  contributions that would have been made by the justice or judge
 1386  and the employer on his or her behalf had he or she continued in
 1387  office for the period of time being claimed, plus 6.5 percent
 1388  interest thereon compounded each June 30 from the date he or she
 1389  left office.
 1390         (7) CONTRIBUTIONS.—
 1391         (b) The employer paying the salary of a member of the
 1392  Elected Officers’ Class shall contribute an amount as specified
 1393  in this subsection or s. 121.71, as appropriate, which shall
 1394  constitute the entire employer retirement contribution with
 1395  respect to such member. The employer shall also withhold one
 1396  half of the entire contribution of the member required for
 1397  social security coverage. Effective July 1, 2011, each member of
 1398  the Elected Officers’ Class shall pay employee contributions as
 1399  specified in s. 121.71.
 1400         (c) If a member of the Elected Officers’ Class ceases to
 1401  fill an office covered by this class for 3 calendar months for
 1402  any reason other than retirement and has not been employed in
 1403  any capacity with any participating employer for 3 calendar
 1404  months, the member may receive a refund of all contributions he
 1405  or she has made to the pension plan, subject to the restrictions
 1406  otherwise provided in this chapter. Partial refunds are not
 1407  permitted. The refund shall not include any interest earnings on
 1408  the contributions for a member of the pension plan. Employer
 1409  contributions made on behalf of the member are not refundable. A
 1410  member may not receive a refund of employee contributions if a
 1411  pending or an approved qualified domestic relations order is
 1412  filed against the member’s retirement account. By obtaining a
 1413  refund of contributions, a member waives all rights under the
 1414  Florida Retirement System and the health insurance subsidy
 1415  provided under s. 112.363 to the service credit represented by
 1416  the refunded contributions, except the right to purchase his or
 1417  her prior service credit in accordance with s. 121.081(2).
 1418         (8) NORMAL RETIREMENT DATE; VESTING REQUIREMENT.—A member
 1419  of the Elected Officers’ Class shall have the same normal
 1420  retirement date and vesting requirement, as those terms are
 1421  defined in s. 121.021(29) and (45), for a member of the regular
 1422  class of the Florida Retirement System. Any public service
 1423  commissioner who was removed from the Elected State Officers’
 1424  Class on July 1, 1979, after attaining at least 8 years of
 1425  creditable service in that class is shall be considered to have
 1426  reached the normal retirement date upon attaining age 62 as
 1427  required in s. 121.021(29)(a).
 1428         (10) ACCRUED SERVICE VALUE.—A member of the Elected
 1429  Officers’ Class who is a Supreme Court justice, district court
 1430  of appeal judge, circuit judge, or county court judge shall
 1431  receive judicial retirement credit of 3 1/3 percent of average
 1432  final compensation, and all other members shall receive elected
 1433  officer accrual value retirement credit of 3 percent of average
 1434  final compensation, for each year of creditable service in such
 1435  class.
 1436         Section 10. Paragraph (a) of subsection (7) of section
 1437  121.053, Florida Statutes, is amended to read:
 1438         121.053 Participation in the Elected Officers’ Class for
 1439  retired members.—
 1440         (7) A member who is elected or appointed to an elective
 1441  office and who is participating in the Deferred Retirement
 1442  Option Program is not subject to termination as defined in s.
 1443  121.021, or reemployment limitations as provided in s.
 1444  121.091(9), until the end of his or her current term of office
 1445  or, if the officer is consecutively elected or reelected to an
 1446  elective office eligible for coverage under the Florida
 1447  Retirement System, until he or she no longer holds an elective
 1448  office, as follows:
 1449         (a) At the end of the 60-month DROP period:
 1450         1. The officer’s DROP account may not accrue additional
 1451  monthly benefits, but does continue to earn interest as provided
 1452  in s. 121.091(13). However, an officer whose DROP participation
 1453  begins on or after July 1, 2010, may not continue to earn such
 1454  interest.
 1455         2. Retirement contributions, except for unfunded actuarial
 1456  liability and health insurance subsidy contributions required in
 1457  ss. 121.71(5) and 121.76, are not required of the employer of
 1458  the elected officer and additional retirement credit may not be
 1459  earned under the Florida Retirement System.
 1460         Section 11. Paragraphs (b) and (j) of subsection (1),
 1461  paragraph (b) of subsection (3), paragraph (b) of subsection
 1462  (4), and paragraphs (c), (d), and (e) of subsection (6) of
 1463  section 121.055, Florida Statutes, are amended, present
 1464  paragraph (c) of subsection (3) of that section is redesignated
 1465  as paragraph (d), and a new paragraph (c) is added to that
 1466  subsection, to read:
 1467         121.055 Senior Management Service Class.—There is hereby
 1468  established a separate class of membership within the Florida
 1469  Retirement System to be known as the “Senior Management Service
 1470  Class,” which shall become effective February 1, 1987.
 1471         (1)
 1472         (b)1. Except as provided in subparagraph 2., effective
 1473  January 1, 1990, participation in the Senior Management Service
 1474  Class is shall be compulsory for the president of each community
 1475  college, the manager of each participating municipality city or
 1476  county, and all appointed district school superintendents.
 1477  Effective January 1, 1994, additional positions may be
 1478  designated for inclusion in the Senior Management Service Class
 1479  if of the Florida Retirement System, provided that:
 1480         a. Positions to be included in the class are shall be
 1481  designated by the local agency employer. Notice of intent to
 1482  designate positions for inclusion in the class must shall be
 1483  published once a week for 2 consecutive weeks in a newspaper of
 1484  general circulation published in the county or counties
 1485  affected, as provided in chapter 50.
 1486         b. Up to 10 nonelective full-time positions may be
 1487  designated for each local agency employer reporting to the
 1488  department of Management Services; for local agencies with 100
 1489  or more regularly established positions, additional nonelective
 1490  full-time positions may be designated, not to exceed 1 percent
 1491  of the regularly established positions within the agency.
 1492         c. Each position added to the class must be a managerial or
 1493  policymaking position filled by an employee who is not subject
 1494  to continuing contract and serves at the pleasure of the local
 1495  agency employer without civil service protection, and who:
 1496         (I) Heads an organizational unit; or
 1497         (II) Has responsibility to effect or recommend personnel,
 1498  budget, expenditure, or policy decisions in his or her areas of
 1499  responsibility.
 1500         2. In lieu of participation in the Senior Management
 1501  Service Class, members of the Senior Management Service Class,
 1502  pursuant to the provisions of subparagraph 1., may withdraw from
 1503  the Florida Retirement System altogether. The decision to
 1504  withdraw from the Florida Retirement system is shall be
 1505  irrevocable for as long as the employee holds the such a
 1506  position. Any service creditable under the Senior Management
 1507  Service Class shall be retained after the member withdraws from
 1508  the Florida Retirement system; however, additional service
 1509  credit in the Senior Management Service Class may shall not be
 1510  earned after such withdrawal. Such members are shall not be
 1511  eligible to participate in the Senior Management Service
 1512  Optional Annuity Program.
 1513         3. Effective January 1, 2006, through June 30, 2006, an
 1514  employee who has withdrawn from the Florida Retirement System
 1515  under subparagraph 2. has one opportunity to elect to
 1516  participate in either the pension plan defined benefit program
 1517  or the investment plan Public Employee Optional Retirement
 1518  Program of the Florida Retirement System.
 1519         a. If the employee elects to participate in the investment
 1520  plan Public Employee Optional Retirement Program, membership
 1521  shall be prospective, and the applicable provisions of s.
 1522  121.4501(4) shall govern the election.
 1523         b. If the employee elects to participate in the pension
 1524  plan defined benefit program of the Florida Retirement System,
 1525  the employee shall, upon payment to the system trust fund of the
 1526  amount calculated under sub-sub-subparagraph (I), receive
 1527  service credit for prior service based upon the time during
 1528  which the employee had withdrawn from the system.
 1529         (I) The cost for such credit shall be an amount
 1530  representing the actuarial accrued liability for the affected
 1531  period of service. The cost shall be calculated using the
 1532  discount rate and other relevant actuarial assumptions that were
 1533  used to value the pension Florida Retirement System defined
 1534  benefit plan liabilities in the most recent actuarial valuation.
 1535  The calculation must shall include any service already
 1536  maintained under the pension defined benefit plan in addition to
 1537  the period of withdrawal. The actuarial accrued liability
 1538  attributable to any service already maintained under the pension
 1539  defined benefit plan shall be applied as a credit to the total
 1540  cost resulting from the calculation. The division must shall
 1541  ensure that the transfer sum is prepared using a formula and
 1542  methodology certified by an actuary.
 1543         (II) The employee must transfer a sum representing the net
 1544  cost owed for the actuarial accrued liability in sub-sub
 1545  subparagraph (I) immediately following the time of such
 1546  movement, determined assuming that attained service equals the
 1547  sum of service in the pension plan defined benefit program and
 1548  the period of withdrawal.
 1549         (j) Except as may otherwise be provided, a any member of
 1550  the Senior Management Service Class may purchase additional
 1551  retirement credit in such class for creditable service within
 1552  the purview of the Senior Management Service Class retroactive
 1553  to February 1, 1987, and may upgrade retirement credit for such
 1554  service, to the extent of 2 percent of the member’s average
 1555  monthly compensation as specified in paragraph (4)(d) for such
 1556  service. Contributions for upgrading the additional Senior
 1557  Management Service credit must pursuant to this paragraph shall
 1558  be equal to the difference in the employer and, if applicable,
 1559  employee contributions paid and the Senior Management Service
 1560  Class contribution rate as a percentage of gross salary in
 1561  effect for the period being claimed, plus interest thereon at
 1562  the rate of 6.5 percent a year, compounded annually until the
 1563  date of payment. This service credit may be purchased by the
 1564  employer on behalf of the member.
 1565         (3)
 1566         (b) The employer paying the salary of a member of the
 1567  Senior Management Service Class shall contribute an amount as
 1568  specified in this section or s. 121.71, as appropriate, which
 1569  shall constitute the entire employer retirement contribution
 1570  with respect to such member. The employer shall also withhold
 1571  one-half of the entire contribution of the member required for
 1572  social security coverage. Effective July 1, 2011, each member
 1573  shall pay employee contributions as specified in s. 121.71.
 1574         (c) Upon termination of employment from all participating
 1575  employers for 3 calendar months for any reason other than
 1576  retirement pursuant to s. 121.021(39)(c), a member may receive a
 1577  refund of all contributions he or she has made to the pension
 1578  plan, subject to the restrictions otherwise provided in this
 1579  chapter. Partial refunds are not permitted. The refund shall not
 1580  include any interest earnings on the contributions for a member
 1581  of the pension plan. Employer contributions made on behalf of
 1582  the member are not refundable. A member may not receive a refund
 1583  of employee contributions if a pending or an approved qualified
 1584  domestic relations order is filed against the member’s
 1585  retirement account. By obtaining a refund of contributions, a
 1586  member waives all rights under the Florida Retirement System and
 1587  the health insurance subsidy provided under s. 112.363 to the
 1588  service credit represented by the refunded contributions, except
 1589  the right to purchase his or her prior service credit in
 1590  accordance with s. 121.081(2).
 1591         (4)
 1592         (b) Service in an eligible position before prior to
 1593  February 1, 1987, or after January 31, 1987, shall satisfy the
 1594  requirement of attaining the normal retirement date as defined
 1595  in s. 121.021(29) for a Senior Management Service Class member,
 1596  if provided the employee is a member of the Senior Management
 1597  Service Class after January 31, 1987. A member of this class who
 1598  fails to complete the 6 years of creditable service required for
 1599  vesting in an eligible position must shall be required to
 1600  satisfy the requirements for the normal retirement date for a
 1601  regular member as provided in s. 121.021(29) and vesting as
 1602  provided in s. 121.021(45).
 1603         (6)
 1604         (c) Participation.—
 1605         1. An eligible employee who is employed on or before
 1606  February 1, 1987, may elect to participate in the optional
 1607  annuity program in lieu of participating participation in the
 1608  Senior Management Service Class. Such election must be made in
 1609  writing and filed with the department and the personnel officer
 1610  of the employer on or before May 1, 1987. An eligible employee
 1611  who is employed on or before February 1, 1987, and who fails to
 1612  make an election to participate in the optional annuity program
 1613  by May 1, 1987, shall be deemed to have elected membership in
 1614  the Senior Management Service Class.
 1615         2. Except as provided in subparagraph 6., an employee who
 1616  becomes eligible to participate in the optional annuity program
 1617  by reason of initial employment commencing after February 1,
 1618  1987, may, within 90 days after the date of commencing
 1619  employment, elect to participate in the optional annuity
 1620  program. Such election must be made in writing and filed with
 1621  the personnel officer of the employer. An eligible employee who
 1622  does not within 90 days after commencing employment elect to
 1623  participate in the optional annuity program shall be deemed to
 1624  have elected membership in the Senior Management Service Class.
 1625         3. A person who is appointed to a position in the Senior
 1626  Management Service Class and who is a member of an existing
 1627  retirement system or the Special Risk or Special Risk
 1628  Administrative Support Classes of the Florida Retirement System
 1629  may elect to remain in such system or class in lieu of
 1630  participating participation in the Senior Management Service
 1631  Class or optional annuity program. Such election must be made in
 1632  writing and filed with the department and the personnel officer
 1633  of the employer within 90 days after of such appointment. An Any
 1634  eligible employee who fails to make an election to participate
 1635  in the existing system, the Special Risk Class of the Florida
 1636  Retirement System, the Special Risk Administrative Support Class
 1637  of the Florida Retirement System, or the optional annuity
 1638  program shall be deemed to have elected membership in the Senior
 1639  Management Service Class.
 1640         4. Except as provided in subparagraph 5., an employee’s
 1641  election to participate in the optional annuity program is
 1642  irrevocable if the employee continues to be employed in an
 1643  eligible position and continues to meet the eligibility
 1644  requirements set forth in this paragraph.
 1645         5. Effective from July 1, 2002, through September 30, 2002,
 1646  an any active employee in a regularly established position who
 1647  has elected to participate in the Senior Management Service
 1648  Optional Annuity Program has one opportunity to choose to move
 1649  from the Senior Management Service Optional Annuity Program to
 1650  the Florida Retirement System Pension Plan System defined
 1651  benefit program.
 1652         a. The election must be made in writing and must be filed
 1653  with the department and the personnel officer of the employer
 1654  before October 1, 2002, or, in the case of an active employee
 1655  who is on a leave of absence on July 1, 2002, within 90 days
 1656  after the conclusion of the leave of absence. This election is
 1657  irrevocable.
 1658         b. The employee shall receive service credit under the
 1659  pension plan defined benefit program of the Florida Retirement
 1660  System equal to his or her years of service under the Senior
 1661  Management Service Optional Annuity Program. The cost for such
 1662  credit is the amount representing the present value of that
 1663  employee’s accumulated benefit obligation for the affected
 1664  period of service.
 1665         c. The employee must transfer the total accumulated
 1666  employer contributions and earnings on deposit in his or her
 1667  Senior Management Service Optional Annuity Program account. If
 1668  the transferred amount is not sufficient to pay the amount due,
 1669  the employee must pay a sum representing the remainder of the
 1670  amount due. The employee may not retain any employer
 1671  contributions or earnings thereon from the Senior Management
 1672  Service Optional Annuity Program account.
 1673         6. A retiree of a state-administered retirement system who
 1674  is initially reemployed on or after July 1, 2010, may not renew
 1675  membership in the Senior Management Service Optional Annuity
 1676  Program.
 1677         (d) Contributions.—
 1678         1.a. Through June 30, 2001, each employer shall contribute
 1679  on behalf of each member of participant in the Senior Management
 1680  Service Optional Annuity Program an amount equal to the normal
 1681  cost portion of the employer retirement contribution which would
 1682  be required if the member participant were a Senior Management
 1683  Service Class member of the Florida Retirement System Pension
 1684  Plan defined benefit program, plus the portion of the
 1685  contribution rate required in s. 112.363(8) that would otherwise
 1686  be assigned to the Retiree Health Insurance Subsidy Trust Fund.
 1687         b. Effective July 1, 2001, through June 30, 2011, each
 1688  employer shall contribute on behalf of each member of
 1689  participant in the optional program an amount equal to 12.49
 1690  percent of the employee’s participant’s gross monthly
 1691  compensation.
 1692         c. Effective July 1, 2011, each member of the optional
 1693  annuity program shall contribute an amount equal to the employee
 1694  contribution required under s. 121.71(3). The employer shall
 1695  contribute on behalf of such employee an amount equal to the
 1696  difference between 12.49 percent of the employee’s gross monthly
 1697  compensation and the amount equal to the employee’s required
 1698  contribution based on the employee’s gross monthly compensation.
 1699         d. The department shall deduct an amount approved by the
 1700  Legislature to provide for the administration of this program.
 1701  The Payment of the contributions, including contributions made
 1702  by the employee, to the optional program which is required by
 1703  this subparagraph for each participant shall be made by the
 1704  employer to the department, which shall forward the
 1705  contributions to the designated company or companies contracting
 1706  for payment of benefits for the member participant under the
 1707  program.
 1708         2. Each employer shall contribute on behalf of each member
 1709  of participant in the Senior Management Service Optional Annuity
 1710  Program an amount equal to the unfunded actuarial accrued
 1711  liability portion of the employer contribution which would be
 1712  required for members of the Senior Management Service Class in
 1713  the Florida Retirement System. This contribution shall be paid
 1714  to the department for transfer to the Florida Retirement System
 1715  Trust Fund.
 1716         3. An Optional Annuity Program Trust Fund shall be
 1717  established in the State Treasury and administered by the
 1718  department to make payments to provider companies on behalf of
 1719  the optional annuity program members participants, and to
 1720  transfer the unfunded liability portion of the state optional
 1721  annuity program contributions to the Florida Retirement System
 1722  Trust Fund.
 1723         4. Contributions required for social security by each
 1724  employer and employee each participant, in the amount required
 1725  for social security coverage as now or hereafter may be provided
 1726  by the federal Social Security Act shall be maintained for each
 1727  member of participant in the Senior Management Service
 1728  retirement program and are shall be in addition to the
 1729  retirement contributions specified in this paragraph.
 1730         5. Each member of participant in the Senior Management
 1731  Service Optional Annuity Program may contribute by way of salary
 1732  reduction or deduction a percentage amount of the employee’s
 1733  participant’s gross compensation not to exceed the percentage
 1734  amount contributed by the employer to the optional annuity
 1735  program. Payment of the employee’s participant’s contributions
 1736  shall be made by the employer to the department, which shall
 1737  forward the contributions to the designated company or companies
 1738  contracting for payment of benefits for the member participant
 1739  under the program.
 1740         (e) Benefits.—
 1741         1. Benefits under the Senior Management Service Optional
 1742  Annuity Program are payable only to members of participants in
 1743  the program, or their beneficiaries as designated by the member
 1744  participant in the contract with the provider company, and must
 1745  be paid by the designated company in accordance with the terms
 1746  of the annuity contract applicable to the member participant. A
 1747  member participant must be terminated from all employment
 1748  relationships with Florida Retirement System employers for 3
 1749  calendar months as provided in s. 121.021(39) to begin receiving
 1750  the employer-funded and employee-funded benefit. The member must
 1751  meet the definition of termination in s. 121.021(39) beginning
 1752  the month after receiving a benefit, including a distribution.
 1753  Benefits funded by employer and employee contributions are
 1754  payable under the terms of the contract to the member
 1755  participant, his or her beneficiary, or his or her estate, in
 1756  addition to:
 1757         a. A lump-sum payment to the beneficiary upon the death of
 1758  the member participant;
 1759         b. A cash-out of a de minimis account upon the request of a
 1760  former member participant who has been terminated for a minimum
 1761  of 6 calendar months from the employment that entitled him or
 1762  her to optional annuity program participation. Such cash-out
 1763  must be a complete liquidation of the account balance with that
 1764  company and is subject to the Internal Revenue Code;
 1765         c. A mandatory distribution of a de minimis account of a
 1766  former member participant who has been terminated for a minimum
 1767  of 6 calendar months from the employment that entitled him or
 1768  her to optional annuity program participation as authorized by
 1769  the department; or
 1770         d. A lump-sum direct rollover distribution whereby all
 1771  accrued benefits, plus interest and investment earnings, are
 1772  paid from the member’s participant’s account directly to the
 1773  custodian of an eligible retirement plan, as defined in s.
 1774  402(c)(8)(B) of the Internal Revenue Code, on behalf of the
 1775  member participant.
 1776         2. Under the Senior Management Service Optional Annuity
 1777  Program, benefits, including employee contributions, are not
 1778  payable for employee hardships, unforeseeable emergencies,
 1779  loans, medical expenses, educational expenses, purchase of a
 1780  principal residence, payments necessary to prevent eviction or
 1781  foreclosure on an employee’s principal residence, or any other
 1782  reason before termination from all employment relationships with
 1783  participating employers for 3 calendar months.
 1784         3.2. The benefits payable to any person under the Senior
 1785  Management Service Optional Annuity Program, and any
 1786  contribution accumulated under such program, are not subject to
 1787  assignment, execution, or attachment or to any legal process
 1788  whatsoever.
 1789         4.3. Except as provided in subparagraph 5. 4., a member
 1790  participant who terminates employment and receives a
 1791  distribution, including a rollover or trustee-to-trustee
 1792  transfer, funded by employer and required employee contributions
 1793  is shall be deemed to be retired from a state-administered
 1794  retirement system if the member participant is subsequently
 1795  employed with an employer that participates in the Florida
 1796  Retirement System.
 1797         5.4. A member participant who receives optional annuity
 1798  program benefits funded by employer and employee contributions
 1799  as a mandatory distribution of a de minimis account authorized
 1800  by the department is not considered a retiree.
 1801  
 1802  As used in this paragraph, a “de minimis account” means an
 1803  account with a provider company containing employer and employee
 1804  contributions and accumulated earnings of not more than $5,000
 1805  made under this chapter.
 1806         Section 12. Subsection (2) of section 121.061, Florida
 1807  Statutes, is amended to read:
 1808         121.061 Funding.—
 1809         (2)(a) Should any employer other than a state employer fail
 1810  to make the retirement and social security contributions, both
 1811  member and employer contributions, required by this chapter,
 1812  then, upon request by the administrator, the Department of
 1813  Revenue or the Department of Financial Services, as the case may
 1814  be, shall deduct the amount owed by the employer from any funds
 1815  to be distributed by it to the county, municipality city,
 1816  metropolitan planning organization, special district, or
 1817  consolidated form of government. The amounts so deducted shall
 1818  be transferred to the administrator for further distribution to
 1819  the trust funds in accordance with this chapter.
 1820         (b) Should any employer for whom the municipality city or
 1821  county tax collector collects taxes, fail to make the retirement
 1822  and social security contributions required by this chapter, the
 1823  tax collector, at the request of the administrator and upon
 1824  receipt of a certificate from the administrator showing the
 1825  amount owed by the employer, shall deduct the amount so
 1826  certified from any taxes collected for the employer and remit
 1827  the amount to the administrator for further distribution to the
 1828  trust funds in accordance with this chapter.
 1829         (c) The governing body of each county, municipality city,
 1830  metropolitan planning organization, special district, or
 1831  consolidated form of government participating under this chapter
 1832  or the administrator, acting individually or jointly, is hereby
 1833  authorized to file and maintain an action in the courts of the
 1834  state to require any employer to remit any retirement or social
 1835  security member contributions or employer matching payments due
 1836  the retirement or social security trust funds under the
 1837  provisions of this chapter.
 1838         (d) Should the income of any constitutional fee officer, in
 1839  any year, be insufficient to make the matching payments required
 1840  by this chapter, the board of county commissioners shall provide
 1841  such fee officer sufficient funds to make these required
 1842  payments when due.
 1843         Section 13. Subsections (2) and (5) and paragraph (c) of
 1844  subsection (6) of section 121.071, Florida Statutes, are
 1845  amended, present paragraph (d) of subsection (6) of that section
 1846  is redesignated as paragraph (e), a new paragraph (d) is added
 1847  to that subsection, and subsection (7) is added to that section,
 1848  to read:
 1849         121.071 Contributions.—Contributions to the system shall be
 1850  made as follows:
 1851         (2)(a) Effective January 1, 1975, or October 1, 1975, as
 1852  applicable, and through June 30, 2011, each employer shall make
 1853  accomplish the contribution required by subsection (1) by a
 1854  procedure in which no employee’s gross salary is shall be
 1855  reduced. Effective July 1, 2011, each employer and employee
 1856  shall pay retirement contributions as specified in s. 121.71.
 1857         (b) Upon termination of employment from all participating
 1858  employers for 3 calendar months for any reason other than
 1859  retirement pursuant to s. 121.021(39)(c), a member may receive
 1860  shall be entitled to a full refund of all the contributions he
 1861  or she has made to the pension prior or subsequent to
 1862  participation in the noncontributory plan, subject to the
 1863  restrictions otherwise provided in this chapter. Partial refunds
 1864  are not permitted. The refund may not include any interest
 1865  earnings on the contributions for a member of the pension plan.
 1866  Employer contributions made on behalf of the member are not
 1867  refundable. A member may not receive a refund of employee
 1868  contributions if a pending or an approved qualified domestic
 1869  relations order is filed against his or her retirement account.
 1870  By obtaining a refund of contributions, a member waives all
 1871  rights under the Florida Retirement System and the health
 1872  insurance subsidy to the service credit represented by the
 1873  refunded contributions, except the right to purchase his or her
 1874  prior service credit in accordance with s. 121.081(2).
 1875         (5) Contributions made in accordance with subsections (1),
 1876  (2), (3), and (4), and s. 121.71 shall be paid by the employer
 1877  into the system trust funds in accordance with rules adopted by
 1878  the administrator pursuant to chapter 120, except as may be
 1879  otherwise specified herein. Effective July 1, 2002,
 1880  contributions paid under subsections (1) and (4) and
 1881  accompanying payroll data are due and payable no later than the
 1882  5th working day of the month immediately following the month
 1883  during which the payroll period ended.
 1884         (6)
 1885         (c) By obtaining a refund of contributions, a member waives
 1886  all rights under the Florida Retirement System and the health
 1887  insurance subsidy as provided in s. 112.363 to the service
 1888  credit represented by the refunded contributions, except the
 1889  right to purchase his or her prior service credit in accordance
 1890  with s. 121.081(2).
 1891         (d) If a member or former member of the pension plan
 1892  receives an invalid refund from the Florida Retirement System
 1893  Trust Fund, such person must repay the full amount of the
 1894  invalid refund, plus interest at 6.5 percent compounded annually
 1895  on each June 30 from the date of refund until full payment is
 1896  made to the trust fund. The invalid refund must be repaid before
 1897  the member retires or, if applicable, transfers to the
 1898  investment plan.
 1899         (7) Before termination of employment, benefits, including
 1900  employee contributions, are not payable under the pension plan
 1901  for employee hardships, unforeseeable emergencies, loans,
 1902  medical expenses, educational expenses, purchase of a principal
 1903  residence, payments necessary to prevent eviction or foreclosure
 1904  on an employee’s principal residence, or any other reason before
 1905  termination from all employment relationships with participating
 1906  employers.
 1907         Section 14. Paragraphs (b) and (c) of subsection (1) and
 1908  subsection (2) of section 121.081, Florida Statutes, are amended
 1909  to read:
 1910         121.081 Past service; prior service; contributions.
 1911  Conditions under which past service or prior service may be
 1912  claimed and credited are:
 1913         (1)
 1914         (b) Past service earned after January 1, 1975, may be
 1915  claimed by officers or employees of a municipality, metropolitan
 1916  planning organization, charter school, charter technical career
 1917  center, or special district who become a covered group under
 1918  this system. The governing body of a covered group may elect to
 1919  provide benefits for past service earned after January 1, 1975,
 1920  in accordance with this chapter., and The cost for such past
 1921  service is established by applying the following formula: The
 1922  employer shall contribute an amount equal to the employer
 1923  contribution rate in effect at the time the service was earned
 1924  and, if applicable, the employee contribution rate, multiplied
 1925  by the employee’s gross salary for each year of past service
 1926  claimed, plus 6.5 percent 6.5-percent interest thereon,
 1927  compounded annually, for figured on each year of past service,
 1928  with interest compounded from date of annual salary earned until
 1929  date of payment.
 1930         (c) If an employer joins the Florida Retirement System and
 1931  does Should the employer not elect to provide past service for
 1932  the member at the time of joining, then the member may claim and
 1933  pay for the service as provided in same, based on paragraphs (a)
 1934  and (b).
 1935         (2) Prior service, as defined in s. 121.021(19), may be
 1936  claimed as creditable service under the Florida Retirement
 1937  System after a member has been reemployed for 1 complete year of
 1938  creditable service within a period of 12 consecutive months,
 1939  except as provided in paragraph (c). Service performed as a
 1940  member participant of the optional retirement program for the
 1941  State University System under s. 121.35 or the Senior Management
 1942  Service Optional Annuity Program under s. 121.055 may be used to
 1943  satisfy the reemployment requirement of 1 complete year of
 1944  creditable service. The member shall not be permitted to make
 1945  any contributions for prior service until after completion of
 1946  the 1 year of creditable service. If a member does not wish to
 1947  claim credit for all of his or her prior service, the service
 1948  the member claims must be the most recent period of service. The
 1949  required contributions for claiming the various types of prior
 1950  service are:
 1951         (a) For prior service performed before prior to the date
 1952  the system becomes noncontributory for the member and for which
 1953  the member had credit under one of the existing retirement
 1954  systems and received a refund of contributions upon termination
 1955  of employment, the member shall contribute 4 percent of all
 1956  salary received during the period being claimed, plus 4 percent
 1957  4-percent interest compounded annually from date of refund until
 1958  July 1, 1975, and 6.5 percent 6.5-percent interest compounded
 1959  annually thereafter, until full payment is made to the Florida
 1960  Retirement System Trust Fund, and shall receive credit in the
 1961  Regular Class. A member who elected to transfer to the Florida
 1962  Retirement System from an existing system may receive credit for
 1963  prior service under the existing system if he or she was
 1964  eligible under the existing system to claim the prior service at
 1965  the time of the transfer. Contributions for such prior service
 1966  shall be determined by the applicable provisions of the system
 1967  under which the prior service is claimed and shall be paid by
 1968  the member, with matching contributions paid by the employer at
 1969  the time the service was performed. Effective July 1, 1978, the
 1970  account of a person who terminated under s. 238.05(3) may not be
 1971  charged interest for contributions that remained on deposit in
 1972  the Annuity Savings Trust Fund established under chapter 238,
 1973  upon retirement under this chapter or chapter 238.
 1974         (b) For prior service performed before prior to the date
 1975  the system becomes noncontributory for the member and for which
 1976  the member had credit under the Florida Retirement System and
 1977  received a refund of contributions upon termination of
 1978  employment, the member shall contribute at the rate that was
 1979  required of him or her during the period of service being
 1980  claimed, on all salary received during such period, plus 4
 1981  percent 4-percent interest compounded annually from date of
 1982  refund until July 1, 1975, and 6.5 percent 6.5-percent interest
 1983  compounded annually thereafter, until the full payment is made
 1984  to the Florida Retirement System Trust Fund, and shall receive
 1985  credit in the membership class in which the member participated
 1986  during the period claimed.
 1987         (c) For prior service as defined in s. 121.021(19)(b) and
 1988  (c) during which no contributions were made because the member
 1989  did not participate in a retirement system, the member shall
 1990  contribute 14.38 percent of all salary received during such
 1991  period or 14.38 percent of $100 per month during such period,
 1992  whichever is greater, plus 4 percent 4-percent interest
 1993  compounded annually from the first year of service claimed until
 1994  July 1, 1975, and 6.5 percent 6.5-percent interest compounded
 1995  annually thereafter, until full payment is made to the
 1996  Retirement Trust Fund, and shall receive credit in the Regular
 1997  Class.
 1998         (d) In order to claim credit for prior service as defined
 1999  in s. 121.021(19)(d) for which no retirement contributions were
 2000  paid during the period of such service, the member shall
 2001  contribute the total employee and employer contributions which
 2002  were required to be made to the Highway Patrol Pension Trust
 2003  Fund, as provided in chapter 321, during the period claimed,
 2004  plus 4 percent 4-percent interest compounded annually from the
 2005  first year of service until July 1, 1975, and 6.5 percent 6.5
 2006  percent interest compounded annually thereafter, until full
 2007  payment is made to the Retirement Trust Fund. However, any
 2008  governmental entity that which employed such member may elect to
 2009  pay up to 50 percent of the contributions and interest required
 2010  to purchase the this prior service credit. The service shall be
 2011  credited in accordance with the provisions of the Highway Patrol
 2012  Pension Plan in effect during the period claimed unless the
 2013  member terminated and withdrew his or her retirement
 2014  contributions and was thereafter enrolled in the State and
 2015  County Officers and Employees’ Retirement System or the Florida
 2016  Retirement System, in which case the service shall be credited
 2017  as Regular Class service.
 2018         (e) For service performed under the Florida Retirement
 2019  System after December 1, 1970, which that was never reported to
 2020  the division or the department due to error, retirement credit
 2021  may be claimed by a member of the Florida Retirement System. The
 2022  department shall adopt rules establishing criteria for claiming
 2023  such credit and detailing the documentation required to
 2024  substantiate the error.
 2025         (f) For prior service performed on or after July 1, 2011,
 2026  for which the member had credit under the Florida Retirement
 2027  System and received a refund of contributions 3 calendar months
 2028  after termination of employment, the member shall contribute at
 2029  the rate that was required during the period of service being
 2030  claimed, plus 6.5 percent interest, compounded annually on each
 2031  June 30 from date of refund until the full payment is made to
 2032  the Florida Retirement System Trust Fund, and receive credit in
 2033  the membership class in which the member participated during the
 2034  period claimed.
 2035         (g)(f) The employer may not be required to make
 2036  contributions for prior service credit for any member, except
 2037  that the employer shall pay the employer portion of
 2038  contributions for any legislator who elects to withdraw from the
 2039  Florida Retirement System and later rejoins the system and pays
 2040  any employee contributions required in accordance with s.
 2041  121.052(3)(d).
 2042         Section 15. Paragraph (a) and (b) of subsection (3),
 2043  paragraph (a) and (j) of subsection (4), paragraphs (a) and (c)
 2044  of subsection (5), paragraph (d) of subsection (9), paragraphs
 2045  (a) and (c) of subsection (13), and paragraph (d) of subsection
 2046  (14) of section 121.091, Florida Statutes, are amended to read:
 2047         121.091 Benefits payable under the system.—Benefits may not
 2048  be paid under this section unless the member has terminated
 2049  employment as provided in s. 121.021(39)(a) or begun
 2050  participation in the Deferred Retirement Option Program as
 2051  provided in subsection (13), and a proper application has been
 2052  filed in the manner prescribed by the department. The department
 2053  may cancel an application for retirement benefits when the
 2054  member or beneficiary fails to timely provide the information
 2055  and documents required by this chapter and the department’s
 2056  rules. The department shall adopt rules establishing procedures
 2057  for application for retirement benefits and for the cancellation
 2058  of such application when the required information or documents
 2059  are not received.
 2060         (3) EARLY RETIREMENT BENEFIT.—Upon retirement on his or her
 2061  early retirement date, the member shall receive an immediate
 2062  monthly benefit that shall begin to accrue on the first day of
 2063  the month of the retirement date and be payable on the last day
 2064  of that month and each month thereafter during his or her
 2065  lifetime. Such benefit shall be calculated as follows:
 2066         (a) For a member initially enrolled:
 2067         1. Before July 1, 2011, the amount of each monthly payment
 2068  shall be computed in the same manner as for a normal retirement
 2069  benefit, in accordance with subsection (1), but shall be based
 2070  on the member’s average monthly compensation and creditable
 2071  service as of the member’s early retirement date. The benefit so
 2072  computed shall be reduced by five-twelfths of 1 percent for each
 2073  complete month by which the early retirement date precedes the
 2074  normal retirement date of age 62 for a member of the Regular
 2075  Class, Senior Management Service Class, or the Elected Officers’
 2076  Class, and age 55 for a member of the Special Risk Class, or age
 2077  52 if a Special Risk member has completed 25 years of creditable
 2078  service in accordance with s. 121.021(29)(b)1.c.
 2079  121.021(29)(b)3.
 2080         2. On or after July 1, 2011, the amount of each monthly
 2081  payment shall be computed in the same manner as for a normal
 2082  retirement benefit, in accordance with subsection (1), but shall
 2083  be based on the member’s average monthly compensation and
 2084  creditable service as of the member’s early retirement date. The
 2085  benefit so computed shall be reduced by five-twelfths of 1
 2086  percent for each complete month by which the early retirement
 2087  date precedes the normal retirement date of age 65 for a member
 2088  of the Regular Class, Senior Management Service Class, or the
 2089  Elected Officers’ Class, and age 60 for a member of the Special
 2090  Risk Class, or age 57 if a special risk member has completed 30
 2091  years of creditable service in accordance with s.
 2092  121.021(29)(b)2.c.
 2093         (b) If the employment of a member is terminated by reason
 2094  of death within 10 years before normal retirement as described
 2095  in s. 121.021(29)(a)1.b. or s. 121.021(29)(a)2.b. subsequent to
 2096  the completion of 20 years of creditable service, the monthly
 2097  benefit payable to the member’s beneficiary shall be calculated
 2098  in accordance with subsection (1), but must shall be based on
 2099  average monthly compensation and creditable service as of the
 2100  date of death. The benefit so computed shall be reduced by five
 2101  twelfths of 1 percent for each complete month by which death
 2102  precedes the normal retirement date specified above or the date
 2103  on which the member would have attained the normal retirement
 2104  date 30 years of creditable service had he or she survived and
 2105  continued his or her employment, whichever provides a higher
 2106  benefit.
 2107         (4) DISABILITY RETIREMENT BENEFIT.—
 2108         (a) Disability retirement; entitlement and effective date.—
 2109         1.a. A member who becomes totally and permanently disabled,
 2110  as defined in paragraph (b), after completing 5 years of
 2111  creditable service, or a member who becomes totally and
 2112  permanently disabled in the line of duty regardless of service,
 2113  is shall be entitled to a monthly disability benefit; except
 2114  that any member with less than 5 years of creditable service on
 2115  July 1, 1980, or any person who becomes a member of the Florida
 2116  Retirement System on or after such date must have completed 10
 2117  years of creditable service before prior to becoming totally and
 2118  permanently disabled in order to receive disability retirement
 2119  benefits for any disability which occurs other than in the line
 2120  of duty. However, if a member employed on July 1, 1980, who has
 2121  with less than 5 years of creditable service as of that date,
 2122  becomes totally and permanently disabled after completing 5
 2123  years of creditable service and is found not to have attained
 2124  fully insured status for benefits under the federal Social
 2125  Security Act, such member is shall be entitled to a monthly
 2126  disability benefit.
 2127         b. Effective July 1, 2001, a member of the pension plan
 2128  defined benefit retirement program who becomes totally and
 2129  permanently disabled, as defined in paragraph (b), after
 2130  completing 8 years of creditable service, or a member who
 2131  becomes totally and permanently disabled in the line of duty
 2132  regardless of service, is shall be entitled to a monthly
 2133  disability benefit.
 2134         2. If the division has received from the employer the
 2135  required documentation of the member’s termination of
 2136  employment, the effective retirement date for a member who
 2137  applies and is approved for disability retirement shall be
 2138  established by rule of the division.
 2139         3. For a member who is receiving Workers’ Compensation
 2140  payments, the effective disability retirement date may not
 2141  precede the date the member reaches Maximum Medical Improvement
 2142  (MMI), unless the member terminates employment before prior to
 2143  reaching MMI.
 2144         (j) Disability retirement of justice or judge by order of
 2145  Supreme Court.—
 2146         1. If a member is a justice of the Supreme Court, judge of
 2147  a district court of appeal, circuit judge, or judge of a county
 2148  court who has served for the number of years equal to, or
 2149  greater than, the vesting requirement in s. 121.021(45) 6 years
 2150  or more as an elected constitutional judicial officer, including
 2151  service as a judicial officer, in any court abolished pursuant
 2152  to Art. V of the State Constitution, and who is retired for
 2153  disability by order of the Supreme Court upon recommendation of
 2154  the Judicial Qualifications Commission pursuant to the
 2155  provisions of Art. V of the State Constitution, the member’s
 2156  Option 1 monthly benefit as provided in subparagraph (6)(a)1.
 2157  may shall not be less than two-thirds of his or her monthly
 2158  compensation as of the member’s disability retirement date. Such
 2159  a member may alternatively elect to receive a disability
 2160  retirement benefit under any other option as provided in
 2161  paragraph (6)(a).
 2162         2. Should any justice or judge who is a member of the
 2163  Florida Retirement System be retired for disability by order of
 2164  the Supreme Court upon recommendation of the Judicial
 2165  Qualifications Commission pursuant to the provisions of Art. V
 2166  of the State Constitution, then all contributions to his or her
 2167  account and all contributions made on his or her behalf by the
 2168  employer shall be transferred to and deposited in the General
 2169  Revenue Fund of the state, and there is hereby appropriated
 2170  annually out of the General Revenue Fund, to be paid into the
 2171  Florida Retirement System Fund, an amount necessary to pay the
 2172  benefits of all justices and judges retired from the Florida
 2173  Retirement System pursuant to Art. V of the State Constitution.
 2174         (5) TERMINATION BENEFITS.—A member whose employment is
 2175  terminated prior to retirement retains membership rights to
 2176  previously earned member-noncontributory service credit, and to
 2177  member-contributory service credit, if the member leaves the
 2178  member contributions on deposit in his or her retirement
 2179  account. If a terminated member receives a refund of member
 2180  contributions, such member may reinstate membership rights to
 2181  the previously earned service credit represented by the refund
 2182  by completing 1 year of creditable service and repaying the
 2183  refunded member contributions, plus interest.
 2184         (a) A member whose employment is terminated for any reason
 2185  other than death or retirement before prior to becoming vested
 2186  is entitled to the return of his or her accumulated
 2187  contributions as of the date of termination. Effective July 1,
 2188  2011, upon termination of employment from all participating
 2189  employers for 3 calendar months as defined in s. 121.021(39)(c)
 2190  for any reason other than retirement, a member may receive a
 2191  refund of all contributions he or she has made to the pension
 2192  plan, subject to the restrictions otherwise provided in this
 2193  chapter. The refund may be received as a lump-sum payment, a
 2194  rollover to a qualified plan, or a combination of these methods.
 2195  Partial refunds are not permitted. The refund may not include
 2196  any interest earnings on the contributions for a member of the
 2197  pension plan. Employer contributions made on behalf of the
 2198  member are not refundable. A member may not receive a refund of
 2199  employee contributions if a pending or an approved qualified
 2200  domestic relations order is filed against his or her retirement
 2201  account. By obtaining a refund of contributions, a member waives
 2202  all rights under the Florida Retirement System and the health
 2203  insurance subsidy to the service credit represented by the
 2204  refunded contributions, except the right to purchase his or her
 2205  prior service credit in accordance with s. 121.081(2).
 2206         (c) In lieu of the deferred monthly benefit provided in
 2207  paragraph (b), the terminated member may elect to receive a
 2208  lump-sum amount equal to his or her accumulated contributions as
 2209  of the date of termination. Effective July 1, 2011, upon
 2210  termination of employment from all participating employers for 3
 2211  calendar months as defined in s. 121.021(39)(c) for any reason
 2212  other than retirement, a member may receive a refund of all
 2213  contributions he or she has made to the pension plan, subject to
 2214  the restrictions otherwise provided in this chapter. Partial
 2215  refunds are not permitted. The refund may not include any
 2216  interest earnings on the contributions for a member of the
 2217  pension plan. Employer contributions made on behalf of the
 2218  member are not refundable. A member may not receive a refund of
 2219  employee contributions if a pending or an approved qualified
 2220  domestic relations order is filed against his or her retirement
 2221  account. By obtaining a refund of contributions, a member waives
 2222  all rights under the Florida Retirement System and the health
 2223  insurance subsidy to the service credit represented by the
 2224  refunded contributions, except the right to purchase his or her
 2225  prior service credit in accordance with s. 121.081(2).
 2226         (9) EMPLOYMENT AFTER RETIREMENT; LIMITATION.—
 2227         (d) The provisions of This subsection applies apply to
 2228  retirees, as defined in s. 121.4501(2), of the Florida
 2229  Retirement System Investment Plan Public Employee Optional
 2230  Retirement Program, subject to the following conditions:
 2231         1. A retiree The retirees may not be reemployed with an
 2232  employer participating in the Florida Retirement System until
 2233  such person has been retired for 6 calendar months.
 2234         2. A retiree employed in violation of this subsection and
 2235  an employer that employs or appoints such person are jointly and
 2236  severally liable for reimbursement of any benefits paid to the
 2237  retirement trust fund from which the benefits were paid,
 2238  including the Retirement System Trust Fund and the Public
 2239  Employee Optional Retirement Program Trust Fund, as appropriate.
 2240  The employer must have a written statement from the retiree that
 2241  he or she is not retired from a state-administered retirement
 2242  system.
 2243         (13) DEFERRED RETIREMENT OPTION PROGRAM.—In general, and
 2244  subject to this section, the Deferred Retirement Option Program,
 2245  hereinafter referred to as DROP, is a program under which an
 2246  eligible member of the Florida Retirement System may elect to
 2247  participate, deferring receipt of retirement benefits while
 2248  continuing employment with his or her Florida Retirement System
 2249  employer. The deferred monthly benefits shall accrue in the
 2250  Florida Retirement System on behalf of the member participant,
 2251  plus interest compounded monthly, for the specified period of
 2252  the DROP participation, as provided in paragraph (c). Upon
 2253  termination of employment, the member participant shall receive
 2254  the total DROP benefits and begin to receive the previously
 2255  determined normal retirement benefits. Participation in the DROP
 2256  does not guarantee employment for the specified period of DROP.
 2257  Participation in DROP by an eligible member beyond the initial
 2258  60-month period as authorized in this subsection shall be on an
 2259  annual contractual basis for all participants.
 2260         (a) Eligibility of member to participate in DROP.—All
 2261  active Florida Retirement System members in a regularly
 2262  established position, and all active members of the Teachers’
 2263  Retirement System established in chapter 238 or the State and
 2264  County Officers’ and Employees’ Retirement System established in
 2265  chapter 122, which are consolidated within the Florida
 2266  Retirement System under s. 121.011, are eligible to elect
 2267  participation in DROP if:
 2268         1. The member is not a renewed member under s. 121.122 or a
 2269  member of the State Community College System Optional Retirement
 2270  Program under s. 121.051, the Senior Management Service Optional
 2271  Annuity Program under s. 121.055, or the optional retirement
 2272  program for the State University System under s. 121.35.
 2273         2. Except as provided in subparagraph 6., election to
 2274  participate is made within 12 months immediately following the
 2275  date on which the member first reaches normal retirement date,
 2276  or, for a member who reaches normal retirement date based on
 2277  service before he or she reaches age 62, or age 55 for Special
 2278  Risk Class members, election to participate may be deferred to
 2279  the 12 months immediately following the date the member attains
 2280  age 57, or age 52 for Special Risk Class members. A member who
 2281  delays DROP participation during the 12-month period immediately
 2282  following his or her maximum DROP deferral date, except as
 2283  provided in subparagraph 6., loses a month of DROP participation
 2284  for each month delayed. A member who fails to make an election
 2285  within the 12-month limitation period forfeits all rights to
 2286  participate in DROP. The member shall advise his or her employer
 2287  and the division in writing of the date DROP begins. The
 2288  beginning date may be subsequent to the 12-month election period
 2289  but must be within the original 60-month participation period
 2290  provided in subparagraph (b)1. When establishing eligibility of
 2291  the member to participate in DROP, the member may elect to
 2292  include or exclude any optional service credit purchased by the
 2293  member from the total service used to establish the normal
 2294  retirement date. A member who has dual normal retirement dates
 2295  is eligible to elect to participate in DROP after attaining
 2296  normal retirement date in either class.
 2297         3. The employer of a member electing to participate in
 2298  DROP, or employers if dually employed, shall acknowledge in
 2299  writing to the division the date the member’s participation in
 2300  DROP begins and the date the member’s employment and DROP
 2301  participation terminates will terminate.
 2302         4. Simultaneous employment of a member participant by
 2303  additional Florida Retirement System employers subsequent to the
 2304  commencement of a member’s participation in DROP is permissible
 2305  if such employers acknowledge in writing a DROP termination date
 2306  no later than the member’s participant’s existing termination
 2307  date or the maximum participation period provided in
 2308  subparagraph (b)1.
 2309         5. A member DROP participant may change employers while
 2310  participating in DROP, subject to the following:
 2311         a. A change of employment takes must take place without a
 2312  break in service so that the member receives salary for each
 2313  month of continuous DROP participation. If a member receives no
 2314  salary during a month, DROP participation ceases shall cease
 2315  unless the employer verifies a continuation of the employment
 2316  relationship for such member participant pursuant to s.
 2317  121.021(39)(b).
 2318         b. The member Such participant and new employer shall
 2319  notify the division of the identity of the new employer on forms
 2320  required by the division.
 2321         c. The new employer acknowledges shall acknowledge, in
 2322  writing, the member’s participant’s DROP termination date, which
 2323  may be extended but not beyond the maximum participation period
 2324  provided in subparagraph (b)1., acknowledges shall acknowledge
 2325  liability for any additional retirement contributions and
 2326  interest required if the member participant fails to timely
 2327  terminate employment, and is subject to the adjustment required
 2328  in sub-subparagraph (c)5.d.
 2329         6. Effective July 1, 2001, for instructional personnel as
 2330  defined in s. 1012.01(2), election to participate in DROP may be
 2331  made at any time following the date on which the member first
 2332  reaches normal retirement date. The member shall advise his or
 2333  her employer and the division in writing of the date on which
 2334  DROP begins. When establishing eligibility of the member to
 2335  participate in DROP for the 60-month participation period
 2336  provided in subparagraph (b)1., the member may elect to include
 2337  or exclude any optional service credit purchased by the member
 2338  from the total service used to establish the normal retirement
 2339  date. A member who has dual normal retirement dates is eligible
 2340  to elect to participate in either class.
 2341         (c) Benefits payable under DROP.—
 2342         1. Effective on the date of DROP participation, the
 2343  member’s initial normal monthly benefit, including creditable
 2344  service, optional form of payment, and average final
 2345  compensation, and the effective date of retirement are fixed.
 2346  The beneficiary established under the Florida Retirement System
 2347  is the beneficiary eligible to receive any DROP benefits payable
 2348  if the DROP participant dies before completing the period of
 2349  DROP participation. If a joint annuitant predeceases the member,
 2350  the member may name a beneficiary to receive accumulated DROP
 2351  benefits payable. The retirement benefit, the annual cost of
 2352  living adjustments provided in s. 121.101, and interest accrue
 2353  monthly in the Florida Retirement System Trust Fund. For members
 2354  whose DROP participation begins:
 2355         a. Before July 1, 2011, the interest accrues at an
 2356  effective annual rate of 6.5 percent compounded monthly, on the
 2357  prior month’s accumulated ending balance, up to the month of
 2358  termination or death, except as provided in s. 121.053(7).
 2359         b. On or after July 1, 2011, the interest accrues at an
 2360  effective annual rate of 1.3 percent, compounded monthly, on the
 2361  prior month’s accumulated ending balance, up to the month of
 2362  termination or death, except as provided in s. 121.053(7).
 2363         2. Each employee who elects to participate in DROP may
 2364  elect to receive a lump-sum payment for accrued annual leave
 2365  earned in accordance with agency policy upon beginning
 2366  participation in DROP. The accumulated leave payment certified
 2367  to the division upon commencement of DROP shall be included in
 2368  the calculation of the member’s average final compensation. The
 2369  employee electing the lump-sum payment is not eligible to
 2370  receive a second lump-sum payment upon termination, except to
 2371  the extent the employee has earned additional annual leave
 2372  which, combined with the original payment, does not exceed the
 2373  maximum lump-sum payment allowed by the employing agency’s
 2374  policy or rules. An early lump-sum payment shall be based on the
 2375  hourly wage of the employee at the time he or she begins
 2376  participation in DROP. If the member elects to wait and receive
 2377  a lump-sum payment upon termination of DROP and termination of
 2378  employment with the employer, any accumulated leave payment made
 2379  at that time may not be included in the member’s retirement
 2380  benefit, which was determined and fixed by law when the employee
 2381  elected to participate in DROP.
 2382         3. The effective date of DROP participation and the
 2383  effective date of retirement of a DROP participant shall be the
 2384  first day of the month selected by the member to begin
 2385  participation in DROP, provided such date is properly
 2386  established, with the written confirmation of the employer, and
 2387  the approval of the division, on forms required by the division.
 2388         4. Normal retirement benefits and any interest shall
 2389  continue to accrue in DROP until the established termination
 2390  date of DROP or until the member participant terminates
 2391  employment or dies before prior to such date, except as provided
 2392  in s. 121.053(7). Although individual DROP accounts may shall
 2393  not be established, a separate accounting of each member’s
 2394  participant’s accrued benefits under DROP shall be calculated
 2395  and provided to the member participants.
 2396         5. At the conclusion of the member’s participation in the
 2397  participant’s DROP, the division shall distribute the member’s
 2398  participant’s total accumulated DROP benefits, subject to the
 2399  following:
 2400         a. The division shall receive verification by the member’s
 2401  participant’s employer or employers that the member participant
 2402  has terminated all employment relationships as provided in s.
 2403  121.021(39).
 2404         b. The terminated DROP participant or, if deceased, the
 2405  member’s participant’s named beneficiary, shall elect on forms
 2406  provided by the division to receive payment of the DROP benefits
 2407  in accordance with one of the options listed below. If a member
 2408  participant or beneficiary fails to elect a method of payment
 2409  within 60 days after termination of DROP, the division shall pay
 2410  a lump sum as provided in sub-sub-subparagraph (I).
 2411         (I) Lump sum.—All accrued DROP benefits, plus interest,
 2412  less withholding taxes remitted to the Internal Revenue Service,
 2413  shall be paid to the DROP participant or surviving beneficiary.
 2414         (II) Direct rollover.—All accrued DROP benefits, plus
 2415  interest, shall be paid from DROP directly to the custodian of
 2416  an eligible retirement plan as defined in s. 402(c)(8)(B) of the
 2417  Internal Revenue Code. However, in the case of an eligible
 2418  rollover distribution to the surviving spouse of a deceased
 2419  member participant, an eligible retirement plan is an individual
 2420  retirement account or an individual retirement annuity as
 2421  described in s. 402(c)(9) of the Internal Revenue Code.
 2422         (III) Partial lump sum.—A portion of the accrued DROP
 2423  benefits shall be paid to DROP participant or surviving spouse,
 2424  less withholding taxes remitted to the Internal Revenue Service,
 2425  and the remaining DROP benefits must be transferred directly to
 2426  the custodian of an eligible retirement plan as defined in s.
 2427  402(c)(8)(B) of the Internal Revenue Code. However, in the case
 2428  of an eligible rollover distribution to the surviving spouse of
 2429  a deceased member participant, an eligible retirement plan is an
 2430  individual retirement account or an individual retirement
 2431  annuity as described in s. 402(c)(9) of the Internal Revenue
 2432  Code. The proportions must be specified by the DROP participant
 2433  or surviving beneficiary.
 2434         c. The form of payment selected by the DROP participant or
 2435  surviving beneficiary must comply with the minimum distribution
 2436  requirements of the Internal Revenue Code.
 2437         d. A DROP participant who fails to terminate all employment
 2438  relationships as provided in s. 121.021(39) shall be deemed as
 2439  not retired, and the DROP election is null and void. Florida
 2440  Retirement System membership shall be reestablished
 2441  retroactively to the date of the commencement of DROP, and each
 2442  employer with whom the member participant continues employment
 2443  must pay to the Florida Retirement System Trust Fund the
 2444  difference between the DROP contributions paid in paragraph (i)
 2445  and the contributions required for the applicable Florida
 2446  Retirement System class of membership during the period the
 2447  member participated in DROP, plus 6.5 percent interest
 2448  compounded annually.
 2449         6. The retirement benefits of any DROP participant who
 2450  terminates all employment relationships as provided in s.
 2451  121.021(39) but is reemployed in violation of the reemployment
 2452  provisions of subsection (9) are shall be suspended during those
 2453  months in which the retiree is in violation. Any retiree in
 2454  violation of this subparagraph and any employer that employs or
 2455  appoints such person without notifying the division of
 2456  Retirement to suspend retirement benefits are jointly and
 2457  severally liable for any benefits paid during the reemployment
 2458  limitation period. The employer must have a written statement
 2459  from the retiree that he or she is not retired from a state
 2460  administered retirement system. Any retirement benefits received
 2461  by a retiree while employed in violation of the reemployment
 2462  limitations must be repaid to the Florida Retirement System
 2463  Trust Fund, and his or her retirement benefits shall remain
 2464  suspended until payment is made. Benefits suspended beyond the
 2465  end of the reemployment limitation period apply toward repayment
 2466  of benefits received in violation of the reemployment
 2467  limitation.
 2468         7. The accrued benefits of any DROP participant, and any
 2469  contributions accumulated under the program, are not subject to
 2470  assignment, execution, attachment, or any legal process
 2471  whatsoever, except for qualified domestic relations court orders
 2472  by a court of competent jurisdiction, income deduction orders as
 2473  provided in s. 61.1301, and federal income tax levies.
 2474         8. DROP participants are not eligible for disability
 2475  retirement benefits as provided in subsection (4).
 2476         (14) PAYMENT OF BENEFITS.—This subsection applies to the
 2477  payment of benefits to a payee (retiree or beneficiary) under
 2478  the Florida Retirement System:
 2479         (d) A payee whose retirement benefits are reduced by the
 2480  application of maximum benefit limits under s. 415(b) of the
 2481  Internal Revenue Code, as specified in s. 121.30(5), shall have
 2482  the portion of his or her calculated benefit in the Florida
 2483  Retirement System Pension System defined benefit Plan which
 2484  exceeds such federal limitation paid through the Florida
 2485  Retirement System Preservation of Benefits Plan, as provided in
 2486  s. 121.1001.
 2487         Section 16. Subsection (1) and paragraph (a) of subsection
 2488  (2) of section 121.1001, Florida Statutes, are amended to read:
 2489         121.1001 Florida Retirement System Preservation of Benefits
 2490  Plan.—Effective July 1, 1999, the Florida Retirement System
 2491  Preservation of Benefits Plan is established as a qualified
 2492  governmental excess benefit arrangement pursuant to s. 415(m) of
 2493  the Internal Revenue Code. The Preservation of Benefits Plan is
 2494  created as a separate portion of the Florida Retirement System,
 2495  for the purpose of providing benefits to a payee (retiree or
 2496  beneficiary) of the Florida Retirement System whose benefits
 2497  would otherwise be limited by s. 415(b) of the Internal Revenue
 2498  Code.
 2499         (1) ELIGIBILITY TO PARTICIPATE IN THE PRESERVATION OF
 2500  BENEFITS PLAN.—A payee of the Florida Retirement System shall
 2501  participate in the Preservation of Benefits Plan if whenever his
 2502  or her earned benefit under the Florida Retirement System
 2503  Pension System defined benefit Plan exceeds the benefit maximum
 2504  established under s. 415(b) of the Internal Revenue Code.
 2505  Participation in the Preservation of Benefits Plan shall
 2506  continue for as long as the payee’s earned benefit under the
 2507  pension Florida Retirement System defined benefit plan is
 2508  reduced by the application of the maximum benefit limit under s.
 2509  415(b) of the Internal Revenue Code.
 2510         (2) BENEFITS PAYABLE UNDER THE PRESERVATION OF BENEFITS
 2511  PLAN.—
 2512         (a) On and after July 1, 1999, the division of Retirement
 2513  shall pay to each eligible payee of the Florida Retirement
 2514  System who retires before, on, or after that such date, a
 2515  supplemental retirement benefit equal to the difference between
 2516  the amount of the payee’s monthly retirement benefit which would
 2517  have been payable under the Florida Retirement System Pension
 2518  System defined benefit Plan if not for a reduction due to the
 2519  application of s. 415(b) of the Internal Revenue Code and the
 2520  reduced monthly retirement benefit as paid to the payee. The
 2521  Preservation of Benefits Plan benefit shall be computed and
 2522  payable under the same terms and conditions and to the same
 2523  person as would have applied under the pension Florida
 2524  Retirement System defined benefit plan were it not for the
 2525  federal limitation.
 2526         Section 17. Subsections (1) and (3) of section 121.101,
 2527  Florida Statutes, are amended, present subsections (4) through
 2528  (7) of that section are redesignated as subsections (6) through
 2529  (9), respectively, and new subsections (4) and (5) are added to
 2530  that section, to read:
 2531         121.101 Cost-of-living adjustment of benefits.—
 2532         (1) The purpose of this section is to provide cost-of
 2533  living adjustments to the monthly benefits payable to all
 2534  retired members of state-supported retirement systems.
 2535         (3) Commencing July 1, 1987, the benefit of each retiree
 2536  and annuitant whose effective retirement date is before July 1,
 2537  2011, shall be adjusted annually on each July 1 thereafter, as
 2538  follows:
 2539         (a) For those retirees and annuitants who have never
 2540  received a cost-of-living adjustment under this section, the
 2541  amount of the monthly benefit payable for the 12-month period
 2542  commencing on the adjustment date shall be the amount of the
 2543  member’s initial benefit plus an amount equal to a percentage of
 2544  the member’s initial benefit; this percentage is derived by
 2545  dividing the number of months the member has received an initial
 2546  benefit by 12, and multiplying the result by 3.
 2547         (b) For those retirees and annuitants who have received a
 2548  cost-of-living adjustment under this subsection section, the
 2549  adjusted monthly benefit shall be the amount of the monthly
 2550  benefit being received on June 30 immediately preceding the
 2551  adjustment date plus an amount equal to 3 percent of this
 2552  benefit.
 2553         (4) For members whose effective retirement date is on or
 2554  after July 1, 2011, the benefit of each retiree and annuitant
 2555  shall be adjusted annually on July 1 as follows:
 2556         (a) For those retirees and annuitants who have never
 2557  received a cost-of-living adjustment under this subsection, the
 2558  amount of the monthly benefit payable for the 12-month period
 2559  commencing on the adjustment date shall be the amount of the
 2560  member’s initial benefit plus an amount equal to a percentage of
 2561  the member’s initial benefit. This percentage is derived by
 2562  dividing the number of months the member has received an initial
 2563  benefit by 12, and multiplying the result by the factor
 2564  calculated pursuant to paragraph (c).
 2565         (b) For those retirees and annuitants who have received a
 2566  cost-of-living adjustment under this subsection, the adjusted
 2567  monthly benefit shall be the amount of the monthly benefit being
 2568  received on June 30 immediately preceding the adjustment date
 2569  plus an amount determined by multiplying the benefit by the
 2570  factor calculated pursuant to paragraph (c).
 2571         (c) The department shall calculate a cost-of-living factor
 2572  for each retiree and beneficiary retiring on or after July 1,
 2573  2011. This factor shall equal the product of 3 percent
 2574  multiplied by the quotient of the sum of the member’s service
 2575  credit earned for service before July 1, 2011, divided by the
 2576  sum of the member’s total service credit earned.
 2577         (5) Subject to the availability of funding and the
 2578  Legislature enacting sufficient employer contributions
 2579  specifically for the purpose of funding the expiration of the
 2580  cost-of-living adjustment specified in subsection (4), in
 2581  accordance with s. 14, Art. X of the State Constitution, the
 2582  cost-of-living adjustment formula provided for in subsection (4)
 2583  shall expire effective June 30, 2016, and the benefit of each
 2584  retiree and annuitant shall be adjusted on each July 1
 2585  thereafter, as provided in subsection (3).
 2586         Section 18. Paragraph (b) of subsection (1) of section
 2587  121.1115, Florida Statutes, is amended to read:
 2588         121.1115 Purchase of retirement credit for out-of-state or
 2589  federal service.—Effective January 1, 1995, a member may
 2590  purchase creditable service for periods of public employment in
 2591  another state and receive creditable service for such periods of
 2592  employment. Service with the Federal Government, including any
 2593  active military service, may be claimed. Upon completion of each
 2594  year of service earned under the Florida Retirement System, a
 2595  member may purchase up to 1 year of retirement credit for his or
 2596  her out-of-state service, subject to the following provisions:
 2597         (1) LIMITATIONS AND CONDITIONS.—To receive credit for the
 2598  out-of-state service:
 2599         (b) The member must have completed the a minimum of 6 years
 2600  of creditable service required for vesting under the Florida
 2601  Retirement System, excluding out-of-state service and in-state
 2602  service claimed and purchased under s. 121.1122.
 2603         Section 19. Paragraph (a) of subsection (2) of section
 2604  121.1122, Florida Statutes, is amended to read:
 2605         121.1122 Purchase of retirement credit for in-state public
 2606  service and in-state service in accredited nonpublic schools and
 2607  colleges, including charter schools and charter technical career
 2608  centers.—Effective January 1, 1998, a member of the Florida
 2609  Retirement System may purchase creditable service for periods of
 2610  certain public or nonpublic employment performed in this state,
 2611  as provided in this section.
 2612         (2) LIMITATIONS AND CONDITIONS.—
 2613         (a) A member is not eligible to receive credit for in-state
 2614  service under this section until he or she has completed the 6
 2615  years of creditable service required for vesting under the
 2616  Florida Retirement System, excluding service purchased under
 2617  this section and out-of-state service claimed and purchased
 2618  under s. 121.1115.
 2619         Section 20. Subsection (1) of section 121.121, Florida
 2620  Statutes, is amended to read:
 2621         121.121 Authorized leaves of absence.—
 2622         (1) A member may purchase creditable service for up to 2
 2623  work years of authorized leaves of absence, including any leaves
 2624  of absence covered under the Family Medical Leave Act, if:
 2625         (a) The member has completed the a minimum of 6 years of
 2626  creditable service required for vesting, excluding periods for
 2627  which a leave of absence was authorized;
 2628         (b) The leave of absence is authorized in writing by the
 2629  employer of the member and approved by the administrator;
 2630         (c) The member returns to active employment performing
 2631  service with a Florida Retirement System employer in a regularly
 2632  established position immediately upon termination of the leave
 2633  of absence and remains on the employer’s payroll for 1 calendar
 2634  month, except that a member who retires on disability while on a
 2635  medical leave of absence may shall not be required to return to
 2636  employment. A member whose work year is less than 12 months and
 2637  whose leave of absence terminates between school years is
 2638  eligible to receive credit for the leave of absence if as long
 2639  as he or she returns to the employment of his or her employer at
 2640  the beginning of the next school year and remains on the
 2641  employer’s payroll for 1 calendar month; and
 2642         (d) The member makes the required contributions for service
 2643  credit during the leave of absence, which shall be 8 percent
 2644  until January 1, 1975, and 9 percent thereafter of his or her
 2645  rate of monthly compensation in effect immediately before prior
 2646  to the commencement of such leave for each month of such period,
 2647  plus 4 percent interest until July 1, 1975, and 6.5 percent
 2648  interest thereafter on such contributions, compounded annually
 2649  each June 30 from the due date of the contribution to date of
 2650  payment.
 2651         1. Effective July 1, 1980, any leave of absence purchased
 2652  pursuant to this section is shall be at the contribution rates
 2653  specified in s. 121.071 or s. 121.71 in effect at the time the
 2654  leave is granted for the class of membership from which the
 2655  leave of absence was granted; however, any member who purchased
 2656  leave-of-absence credit before prior to July 1, 1980, for a
 2657  leave of absence from a position in a class other than the
 2658  regular membership class, may pay the appropriate additional
 2659  contributions plus compound interest thereon and receive
 2660  creditable service for such leave of absence in the membership
 2661  class from which the member was granted the leave of absence.
 2662         2. Effective July 1, 2011, any leave of absence purchased
 2663  by the member pursuant to this section shall be at the employer
 2664  and employee contribution rates specified in s. 121.71 in effect
 2665  during the leave for the class of membership from which the
 2666  leave of absence was granted.
 2667         Section 21. Section 121.125, Florida Statutes, is amended
 2668  to read:
 2669         121.125 Credit for workers’ compensation payment periods.—A
 2670  member of the retirement system created by this chapter who has
 2671  been eligible or becomes eligible to receive workers’
 2672  compensation payments for an injury or illness occurring during
 2673  his or her employment while a member of any state retirement
 2674  system shall, upon return to active employment with a covered
 2675  employer for 1 calendar month or upon approval for disability
 2676  retirement in accordance with s. 121.091(4), receive full
 2677  retirement credit for the period prior to such return to active
 2678  employment or disability retirement for which the workers’
 2679  compensation payments were received. However, a no member may
 2680  not receive retirement credit for any such period occurring
 2681  after the earlier of the date of maximum medical improvement as
 2682  defined in s. 440.02 or the date termination has occurred as
 2683  defined in s. 121.021(39). The employer of record at the time of
 2684  the worker’s compensation injury or illness shall make the
 2685  required employer and employee retirement contributions based on
 2686  the member’s rate of monthly compensation immediately prior to
 2687  his or her receiving workers’ compensation payments for
 2688  retirement credit received by the member. The employer of record
 2689  at the time of the workers’ compensation injury or illness shall
 2690  be assessed by the division a penalty of 1 percent of the
 2691  contributions on all contributions not paid on the first payroll
 2692  report after the member becomes eligible to receive credit. This
 2693  delinquent assessment may not be waived.
 2694         Section 22. Section 121.161, Florida Statutes, is reenacted
 2695  to read:
 2696         121.161 References to other laws include amendments.
 2697  References in this chapter to state or federal laws or
 2698  agreements are intended to include such laws as they now exist
 2699  or may hereafter be amended.
 2700         Section 23. Section 121.182, Florida Statutes, is amended
 2701  to read:
 2702         121.182 Retirement annuities authorized for city and county
 2703  personnel.—Municipalities Cities and counties are authorized to
 2704  purchase annuities for all municipal city and county personnel
 2705  with 25 or more years of creditable service who have reached age
 2706  50 and have applied for retirement under the Florida Retirement
 2707  System. No such annuity shall provide for more than the total
 2708  difference in retirement income between the retirement benefit
 2709  based on average monthly compensation and creditable service as
 2710  of the member’s early retirement date and the early retirement
 2711  benefit. Municipalities Cities and counties may also purchase
 2712  annuities for members of the Florida Retirement System who have
 2713  out-of-state service in another state or country which is
 2714  documented as valid by the appropriate city or county. Such
 2715  annuities may be based on no more than 5 years of out-of-state
 2716  service and may equal, but not exceed, the benefits that would
 2717  be payable under the Florida Retirement System if credit for
 2718  out-of-state service was authorized under that system.
 2719  Municipalities Cities and counties are authorized to invest
 2720  funds, purchase annuities, or provide local supplemental
 2721  retirement programs for purposes of providing annuities for city
 2722  or county personnel. All retirement annuities shall comply with
 2723  s. 14, Art. X of the State Constitution.
 2724         Section 24. Paragraphs (g) and (i) of subsection (3),
 2725  subsection (4), and subsection (5) of section 121.35, Florida
 2726  Statutes, are amended to read:
 2727         121.35 Optional retirement program for the State University
 2728  System.—
 2729         (3) ELECTION OF OPTIONAL PROGRAM.—
 2730         (g) An eligible employee who is a member of the Florida
 2731  Retirement System at the time of election to participate in the
 2732  optional retirement program shall retain all retirement service
 2733  credit earned under the Florida Retirement System, at the rate
 2734  earned. No Additional service credit in the Florida Retirement
 2735  System may not shall be earned while the employee participates
 2736  in the optional program, and nor shall the employee is not be
 2737  eligible for disability retirement under the Florida Retirement
 2738  System. An eligible employee may transfer from the Florida
 2739  Retirement System to his or her accounts under the State
 2740  University System Optional Retirement Program a sum representing
 2741  the present value of the employee’s accumulated benefit
 2742  obligation under the defined benefit program of the pension plan
 2743  Florida Retirement System for any service credit accrued from
 2744  the employee’s first eligible transfer date to the optional
 2745  retirement program through the actual date of such transfer, if
 2746  such service credit was earned in the period from July 1, 1984,
 2747  through December 31, 1992. The present value of the employee’s
 2748  accumulated benefit obligation shall be calculated as described
 2749  in s. 121.4501(3)(c)2. Upon such transfer, all such service
 2750  credit previously earned under the defined benefit program of
 2751  the pension plan Florida Retirement System during this period is
 2752  shall be nullified for purposes of entitlement to a future
 2753  benefit under the pension plan defined benefit program of the
 2754  Florida Retirement System.
 2755         (i) Effective January 1, 2008, through December 31, 2008,
 2756  except for an employee who is a mandatory participant of the
 2757  State University System Optional Retirement Program, an employee
 2758  who has elected to participate in the State University System
 2759  Optional Retirement Program shall have one opportunity, at the
 2760  employee’s discretion, to choose to transfer from this program
 2761  to the defined benefit program of the Florida Retirement System
 2762  Pension Plan or to the investment plan Public Employee Optional
 2763  Retirement Program, subject to the terms of the applicable
 2764  contracts of the State University System Optional Retirement
 2765  Program.
 2766         1. If the employee chooses to move to the investment plan
 2767  Public Employee Optional Retirement Program, any contributions,
 2768  interest, and earnings creditable to the employee under the
 2769  State University System Optional Retirement Program must shall
 2770  be retained by the employee in the State University System
 2771  Optional Retirement Program, and the applicable provisions of s.
 2772  121.4501(4) shall govern the election.
 2773         2. If the employee chooses to move to the pension plan
 2774  defined benefit program of the Florida Retirement System, the
 2775  employee shall receive service credit equal to his or her years
 2776  of service under the State University System Optional Retirement
 2777  Program.
 2778         a. The cost for such credit must be in shall be an amount
 2779  representing the actuarial accrued liability for the affected
 2780  period of service. The cost must shall be calculated using the
 2781  discount rate and other relevant actuarial assumptions that were
 2782  used to value the Florida Retirement System Pension defined
 2783  benefit Plan liabilities in the most recent actuarial valuation.
 2784  The calculation must shall include any service already
 2785  maintained under the pension defined benefit plan in addition to
 2786  the years under the State University System Optional Retirement
 2787  Program. The actuarial accrued liability of any service already
 2788  maintained under the pension defined benefit plan must shall be
 2789  applied as a credit to total cost resulting from the
 2790  calculation. The division must shall ensure that the transfer
 2791  sum is prepared using a formula and methodology certified by an
 2792  enrolled actuary.
 2793         b. The employee must transfer from his or her State
 2794  University System Optional Retirement Program account, and from
 2795  other employee moneys as necessary, a sum representing the
 2796  actuarial accrued liability immediately following the time of
 2797  such movement, determined assuming that attained service equals
 2798  the sum of service in the pension plan defined benefit program
 2799  and service in the State University System Optional Retirement
 2800  Program.
 2801         (4) CONTRIBUTIONS.—
 2802         (a)1. Through June 30, 2001, each employer shall contribute
 2803  on behalf of each member of participant in the optional
 2804  retirement program an amount equal to the normal cost portion of
 2805  the employer retirement contribution which would be required if
 2806  the employee participant were a regular member of the Florida
 2807  Retirement System Pension Plan System defined benefit program,
 2808  plus the portion of the contribution rate required in s.
 2809  112.363(8) that would otherwise be assigned to the Retiree
 2810  Health Insurance Subsidy Trust Fund.
 2811         2. Effective July 1, 2001, through June 30, 2011, each
 2812  employer shall contribute on behalf of each member of
 2813  participant in the optional retirement program an amount equal
 2814  to 10.43 percent of the employee’s participant’s gross monthly
 2815  compensation.
 2816         3. Effective July 1, 2011, each member of the optional
 2817  retirement program shall contribute an amount equal to the
 2818  employee contribution required in s. 121.71(3). The employer
 2819  shall contribute on behalf of each such member an amount equal
 2820  to the difference between 10.43 percent of the employee’s gross
 2821  monthly compensation and the amount equal to the employee’s
 2822  required contribution based on the employee’s gross monthly
 2823  compensation.
 2824         4.The department shall deduct an amount approved by the
 2825  Legislature to provide for the administration of this program.
 2826  The payment of the contributions, including contributions by the
 2827  employee, to the optional program which is required by this
 2828  paragraph for each participant shall be made by the employer to
 2829  the department, which shall forward the contributions to the
 2830  designated company or companies contracting for payment of
 2831  benefits for members of the participant under the program.
 2832  However, such contributions paid on behalf of an employee
 2833  described in paragraph (3)(c) may shall not be forwarded to a
 2834  company and do shall not begin to accrue interest until the
 2835  employee has executed a contract and notified the department.
 2836  The department shall deduct an amount from the contributions to
 2837  provide for the administration of this program.
 2838         (b) Each employer shall contribute on behalf of each member
 2839  of participant in the optional retirement program an amount
 2840  equal to the unfunded actuarial accrued liability portion of the
 2841  employer contribution which would be required for members of the
 2842  Florida Retirement System. This contribution shall be paid to
 2843  the department for transfer to the Florida Retirement System
 2844  Trust Fund.
 2845         (c) An Optional Retirement Program Trust Fund shall be
 2846  established in the State Treasury and administered by the
 2847  department to make payments to the provider companies on behalf
 2848  of the optional retirement program members participants, and to
 2849  transfer the unfunded liability portion of the state optional
 2850  retirement program contributions to the Florida Retirement
 2851  System Trust Fund.
 2852         (d) Contributions required for social security by each
 2853  employer and each employee participant, in the amount required
 2854  for social security coverage as now or hereafter may be provided
 2855  by the federal Social Security Act, shall be maintained for each
 2856  member of participant in the optional retirement program and are
 2857  shall be in addition to the retirement contributions specified
 2858  in this subsection.
 2859         (e) Each member of participant in the optional retirement
 2860  program who has executed a contract may contribute by way of
 2861  salary reduction or deduction a percentage amount of the
 2862  employee’s participant’s gross compensation not to exceed the
 2863  percentage amount contributed by the employer to the optional
 2864  program, but in no case may such contribution may not exceed
 2865  federal limitations. Payment of the employee’s participant’s
 2866  contributions shall be made by the financial officer of the
 2867  employer to the division which shall forward the contributions
 2868  to the designated company or companies contracting for payment
 2869  of benefits for members of the participant under the program. A
 2870  member participant may not make, through salary reduction, any
 2871  voluntary employee contributions to any other plan under s.
 2872  403(b) of the Internal Revenue Code, with the exception of a
 2873  custodial account under s. 403(b)(7) of the Internal Revenue
 2874  Code, until he or she has made an employee contribution to his
 2875  or her optional program equal to the employer contribution. An
 2876  employee A participant is responsible for monitoring his or her
 2877  individual tax-deferred income to ensure he or she does not
 2878  exceed the maximum deferral amounts permitted under the Internal
 2879  Revenue Code.
 2880         (f) The Optional Retirement Trust Fund may accept for
 2881  deposit into member participant contracts contributions in the
 2882  form of rollovers or direct trustee-to-trustee transfers by or
 2883  on behalf of members participants who are reasonably determined
 2884  by the department to be eligible for rollover or transfer to the
 2885  optional retirement program pursuant to the Internal Revenue
 2886  Code, if such contributions are made in accordance with rules
 2887  adopted by the department. Such contributions shall be accounted
 2888  for in accordance with any applicable requirements of the
 2889  Internal Revenue Code and department rules of the department.
 2890         (g) Effective July 1, 2008, for purposes of paragraph (a)
 2891  and notwithstanding s. 121.021(22)(b)1., the term “employee’s
 2892  participant’s gross monthly compensation” includes salary
 2893  payments made to eligible clinical faculty from a state
 2894  university using funds provided by a faculty practice plan
 2895  authorized by the Board of Governors of the State University
 2896  System if:
 2897         1. There is no not any employer contribution from the state
 2898  university to any other retirement program with respect to such
 2899  salary payments; and
 2900         2. The employer contribution on behalf of a member of the
 2901  participant in the optional retirement program with respect to
 2902  such salary payments is made using funds provided by the faculty
 2903  practice plan.
 2904         (5) BENEFITS.—
 2905         (a) Benefits are payable under the optional retirement
 2906  program only to vested members participating participants in the
 2907  program, or their beneficiaries as designated by the member
 2908  participant in the contract with a provider company, and such
 2909  benefits shall be paid only by the designated company in
 2910  accordance with s. 403(b) of the Internal Revenue Code and the
 2911  terms of the annuity contract or contracts applicable to the
 2912  member participant. Benefits accrue in individual accounts that
 2913  are member-directed participant-directed, portable, and funded
 2914  by employer and employee contributions and the earnings thereon.
 2915  The member participant must be terminated for 3 calendar months
 2916  from all employment relationships with all Florida Retirement
 2917  System employers, as provided in s. 121.021(39), to begin
 2918  receiving the employer-funded benefit. Benefits funded by
 2919  employer and employee contributions are payable in accordance
 2920  with the following terms and conditions:
 2921         1. Benefits shall be paid only to a participating member
 2922  participant, to his or her beneficiaries, or to his or her
 2923  estate, as designated by the member participant.
 2924         2. Benefits shall be paid by the provider company or
 2925  companies in accordance with the law, the provisions of the
 2926  contract, and any applicable department rule or policy.
 2927         3. In the event of a member’s participant’s death, moneys
 2928  accumulated by, or on behalf of, the member participant, less
 2929  withholding taxes remitted to the Internal Revenue Service, if
 2930  any, shall be distributed to the member’s participant’s
 2931  designated beneficiary or beneficiaries, or to the member’s
 2932  participant’s estate, as if the member participant retired on
 2933  the date of death, as provided in paragraph (d) (c). No other
 2934  death benefits are available to survivors of members
 2935  participants under the optional retirement program except for
 2936  such benefits, or coverage for such benefits, as are separately
 2937  afforded by the employer, at the employer’s discretion.
 2938         (b) Benefits, including employee contributions, are not
 2939  payable for employee hardships, unforeseeable emergencies,
 2940  loans, medical expenses, educational expenses, purchase of a
 2941  principal residence, payments necessary to prevent eviction or
 2942  foreclosure on an employee’s principal residence, or any other
 2943  reason before termination from all employment relationships with
 2944  participating employers for 3 calendar months.
 2945         (c)(b) Upon receipt by the provider company of a properly
 2946  executed application for distribution of benefits, the total
 2947  accumulated benefit is shall be payable to the participating
 2948  member participant, as:
 2949         1. A lump-sum distribution to the member participant;
 2950         2. A lump-sum direct rollover distribution whereby all
 2951  accrued benefits, plus interest and investment earnings, are
 2952  paid from the member’s participant’s account directly to an
 2953  eligible retirement plan, as defined in s. 402(c)(8)(B) of the
 2954  Internal Revenue Code, on behalf of the member participant;
 2955         3. Periodic distributions;
 2956         4. A partial lump-sum payment whereby a portion of the
 2957  accrued benefit is paid to the member participant and the
 2958  remaining amount is transferred to an eligible retirement plan,
 2959  as defined in s. 402(c)(8)(B) of the Internal Revenue Code, on
 2960  behalf of the member participant; or
 2961         5. Such other distribution options as are provided for in
 2962  the member’s participant’s optional retirement program contract.
 2963         (d)(c) Survivor benefits are shall be payable as:
 2964         1. A lump-sum distribution payable to the beneficiaries or
 2965  to the deceased member’s participant’s estate;
 2966         2. An eligible rollover distribution on behalf of the
 2967  surviving spouse of a deceased member participant, whereby all
 2968  accrued benefits, plus interest and investment earnings, are
 2969  paid from the deceased member’s participant’s account directly
 2970  to an eligible retirement plan, as described in s. 402(c)(8)(B)
 2971  of the Internal Revenue Code, on behalf of the surviving spouse;
 2972         3. Such other distribution options as are provided for in
 2973  the member’s participant’s optional retirement program contract;
 2974  or
 2975         4. A partial lump-sum payment whereby a portion of the
 2976  accrued benefit is paid to the deceased member’s participant’s
 2977  surviving spouse or other designated beneficiaries, less
 2978  withholding taxes remitted to the Internal Revenue Service, if
 2979  any, and the remaining amount is transferred directly to an
 2980  eligible retirement plan, as described in s. 402(c)(8)(B) of the
 2981  Internal Revenue Code, on behalf of the surviving spouse. The
 2982  proportions must be specified by the member participant or the
 2983  surviving beneficiary.
 2984  
 2985  This paragraph does not abrogate other applicable provisions of
 2986  state or federal law providing payment of death benefits.
 2987         (e)(d) The benefits payable to any person under the
 2988  optional retirement program, and any contribution accumulated
 2989  under such program, are shall not be subject to assignment,
 2990  execution, or attachment or to any legal process whatsoever.
 2991         (f)(e) A participating member participant who chooses to
 2992  receive his or her benefits must be terminated for 3 calendar
 2993  months to be eligible to receive benefits funded by employer and
 2994  employee contributions. The member upon termination as defined
 2995  in s. 121.021 must notify the provider company of the date he or
 2996  she wishes benefits funded by required employer and employee
 2997  contributions to begin and must be terminated as defined in s.
 2998  121.021 after the initial benefit payment or distribution is
 2999  received. Benefits may be deferred until the member participant
 3000  chooses to make such application.
 3001         (g)(f) Benefits funded by the participating member’s
 3002  voluntary participant’s personal contributions may be paid out
 3003  at any time and in any form within the limits provided in the
 3004  contract between the member participant and the his or her
 3005  provider company. The member participant shall notify the
 3006  provider company regarding the date and provisions under which
 3007  he or she wants to receive the employee-funded portion of the
 3008  plan.
 3009         (h)(g) For purposes of this section, “retiree” means a
 3010  former participating member participant of the optional
 3011  retirement program who has terminated employment and has taken a
 3012  distribution as provided in this subsection, except for a
 3013  mandatory distribution of a de minimis account authorized by the
 3014  department.
 3015         Section 25. Section 121.355, Florida Statutes, is amended
 3016  to read:
 3017         121.355 Community College Optional Retirement Program and
 3018  State University System Optional Retirement Program member
 3019  transfer.—Effective January 1, 2009, through December 31, 2009,
 3020  an employee who is a former member of participant in the
 3021  Community College Optional Retirement Program or the State
 3022  University System Optional Retirement Program and present
 3023  mandatory member of participant in the Florida Retirement System
 3024  Pension System defined benefit Plan may receive service credit
 3025  equal to his or her years of service under the Community College
 3026  Optional Retirement Program or the State University System
 3027  Optional Retirement Program under the following conditions:
 3028         (1) The cost for such credit must represent shall be an
 3029  amount representing the actuarial accrued liability for the
 3030  affected period of service. The cost shall be calculated using
 3031  the discount rate and other relevant actuarial assumptions that
 3032  were used to value the Florida Retirement System Pension System
 3033  defined benefit Plan liabilities in the most recent actuarial
 3034  valuation. The calculation must shall include any service
 3035  already maintained under the pension defined benefit plan in
 3036  addition to the years under the Community College Optional
 3037  Retirement Program or the State University System Optional
 3038  Retirement Program. The actuarial accrued liability of any
 3039  service already maintained under the pension defined benefit
 3040  plan shall be applied as a credit to total cost resulting from
 3041  the calculation. The division shall ensure that the transfer sum
 3042  is prepared using a formula and methodology certified by an
 3043  enrolled actuary.
 3044         (2) The employee must transfer from his or her Community
 3045  College Optional Retirement Program account or State University
 3046  System Optional Retirement Program account, subject to the terms
 3047  of the applicable optional retirement program contract, and from
 3048  other employee moneys as necessary, a sum representing the
 3049  actuarial accrued liability immediately following the time of
 3050  such movement, determined assuming that attained service equals
 3051  the sum of service in the pension plan defined benefit program
 3052  and service in the Community College Optional Retirement Program
 3053  or State University System Optional Retirement Program.
 3054         (3) The employee may not receive service credit for a
 3055  period of mandatory participation in the State University
 3056  Optional Retirement Program or for a period for which a
 3057  distribution was received from the Community College Optional
 3058  Retirement Program or State University System Optional
 3059  Retirement Program.
 3060         Section 26. Section 121.4501, Florida Statutes, is amended
 3061  to read:
 3062         121.4501 Florida Retirement System Investment Plan Public
 3063  Employee Optional Retirement Program.—
 3064         (1) The Trustees of the State Board of Administration shall
 3065  establish a an optional defined contribution retirement program
 3066  called the “Florida Retirement System Investment Plan” or
 3067  “investment plan” for members of the Florida Retirement System
 3068  under which retirement benefits will be provided for eligible
 3069  employees who elect to participate in the program. The
 3070  retirement benefits to be provided for or on behalf of
 3071  participants in such optional retirement program shall be
 3072  provided through member-directed employee-directed investments,
 3073  in accordance with s. 401(a) of the Internal Revenue Code and
 3074  its related regulations. The employer and employee employers
 3075  shall make contributions contribute, as provided in this section
 3076  and, ss. 121.571, and 121.71, to the Florida Retirement System
 3077  Investment Plan Public Employee Optional Retirement Program
 3078  Trust Fund toward the funding of such optional benefits.
 3079         (2) DEFINITIONS.—As used in this part, the term:
 3080         (a) “Approved provider” or “provider” means a private
 3081  sector company that is selected and approved by the state board
 3082  to offer one or more investment products or services to the
 3083  investment plan optional retirement program. The term includes a
 3084  bundled provider that offers members participants a range of
 3085  individually allocated or unallocated investment products and
 3086  may offer a range of administrative and customer services, which
 3087  may include accounting and administration of individual member
 3088  participant benefits and contributions; individual member
 3089  participant recordkeeping; asset purchase, control, and
 3090  safekeeping; direct execution of the member’s participant’s
 3091  instructions as to asset and contribution allocation;
 3092  calculation of daily net asset values; direct access to member
 3093  participant account information; periodic reporting to members
 3094  participants, at least quarterly, on account balances and
 3095  transactions; guidance, advice, and allocation services directly
 3096  relating to the provider’s own investment options or products,
 3097  but only if the bundled provider complies with the standard of
 3098  care of s. 404(a)(1)(A-B) of the Employee Retirement Income
 3099  Security Act of 1974 (ERISA), and if providing such guidance,
 3100  advice, or allocation services does not constitute a prohibited
 3101  transaction under s. 4975(c)(1) of the Internal Revenue Code or
 3102  s. 406 of ERISA, notwithstanding that such prohibited
 3103  transaction provisions do not apply to the optional retirement
 3104  program; a broad array of distribution options; asset
 3105  allocation; and retirement counseling and education. Private
 3106  sector companies include investment management companies,
 3107  insurance companies, depositories, and mutual fund companies.
 3108         (b) “Average monthly compensation” means one-twelfth of
 3109  average final compensation as defined in s. 121.021.
 3110         (c) “Covered employment” means employment in a regularly
 3111  established position as defined in s. 121.021.
 3112         (d) “Defined benefit program” means the defined benefit
 3113  program of the Florida Retirement System administered under part
 3114  I of this chapter.
 3115         (e) “Division” means the Division of Retirement within the
 3116  department.
 3117         (d)(f) “Electronic means” means by telephone, if the
 3118  required information is received on a recorded line, or through
 3119  Internet access, if the required information is captured online.
 3120         (e)(g) “Eligible employee” means an officer or employee, as
 3121  defined in s. 121.021, who:
 3122         1. Is a member of, or is eligible for membership in, the
 3123  Florida Retirement System, including any renewed member of the
 3124  Florida Retirement System initially enrolled before July 1,
 3125  2010; or
 3126         2. Participates in, or is eligible to participate in, the
 3127  Senior Management Service Optional Annuity Program as
 3128  established under s. 121.055(6), the State Community College
 3129  System Optional Retirement Program as established under s.
 3130  121.051(2)(c), or the State University System Optional
 3131  Retirement Program established under s. 121.35.
 3132  
 3133  The term does not include any member participating in the
 3134  Deferred Retirement Option Program established under s.
 3135  121.091(13), a retiree of a state-administered retirement system
 3136  initially reemployed on or after July 1, 2010, or a mandatory
 3137  participant of the State University System Optional Retirement
 3138  Program established under s. 121.35.
 3139         (f)(h) “Employer” means an employer, as defined in s.
 3140  121.021, of an eligible employee.
 3141         (g)(i)“Florida Retirement System Investment Plan” or
 3142  “investment plan” “Optional retirement program” or “optional
 3143  program” means the defined contribution program Public Employee
 3144  Optional Retirement Program established under this part.
 3145         (h) “Florida Retirement System Pension Plan” or “pension
 3146  plan” means the defined benefit program of the Florida
 3147  Retirement System administered under part I of this chapter.
 3148         (i)(j)“Member” or “employee” “Participant” means an
 3149  eligible employee who enrolls in the investment plan optional
 3150  program as provided in subsection (4), or a terminated Deferred
 3151  Retirement Option Program member participant as described in
 3152  subsection (21), or a beneficiary or alternate payee of a member
 3153  or employee.
 3154         (j) “Member contributions” or “employee contributions”
 3155  means the sum of all amounts deducted from the salary of a
 3156  member by his or her employer in accordance with s. 121.71(3)
 3157  and credited to his or her individual account in the investment
 3158  plan, plus any earnings on such amounts and any contributions
 3159  specified in paragraph (5)(e).
 3160         (k) “Retiree” means a former member participant of the
 3161  investment plan optional retirement program who has terminated
 3162  employment and has taken a distribution of vested employee or
 3163  employer contributions as provided in s. 121.591, except for a
 3164  mandatory distribution of a de minimis account authorized by the
 3165  state board or a minimum required distribution provided by s.
 3166  401(a)(9) of the Internal Revenue Code.
 3167         (l) “Vested” or “vesting” means the guarantee that a member
 3168  participant is eligible to receive a retirement benefit upon
 3169  completion of the required years of service under the investment
 3170  plan optional retirement program.
 3171         (3) ELIGIBILITY; RETIREMENT SERVICE CREDIT; TRANSFER OF
 3172  BENEFITS.—
 3173         (a) Participation in the Public Employee Optional
 3174  Retirement Program is limited to eligible employees.
 3175  Participation in the optional retirement program is in lieu of
 3176  participation in the defined benefit program of the Florida
 3177  Retirement System.
 3178         (a)(b) An eligible employee who is employed in a regularly
 3179  established position by a state employer on June 1, 2002; by a
 3180  district school board employer on September 1, 2002; or by a
 3181  local employer on December 1, 2002, and who is a member of the
 3182  pension plan defined benefit retirement program of the Florida
 3183  Retirement System at the time of his or her election to
 3184  participate in the investment plan Public Employee Optional
 3185  Retirement Program shall retain all retirement service credit
 3186  earned under the pension plan defined benefit retirement program
 3187  of the Florida Retirement System as credited under the system
 3188  and is shall be entitled to a deferred benefit upon termination,
 3189  if eligible under the system. However, election to enroll
 3190  participate in the investment plan Public Employee Optional
 3191  Retirement Program terminates the active membership of the
 3192  employee in the pension plan defined benefit program of the
 3193  Florida Retirement System, and the service of a member
 3194  participant in the investment plan is Public Employee Optional
 3195  Retirement Program shall not be creditable under the pension
 3196  plan defined benefit retirement program of the Florida
 3197  Retirement System for purposes of benefit accrual but is
 3198  creditable shall be credited for purposes of vesting.
 3199         (b)(c)1. Notwithstanding paragraph (a), an (b), each
 3200  eligible employee who elects to participate in the investment
 3201  plan Public Employee Optional Retirement Program and establishes
 3202  one or more individual member participant accounts under the
 3203  optional program may elect to transfer to the investment plan
 3204  optional program a sum representing the present value of the
 3205  employee’s accumulated benefit obligation under the pension plan
 3206  defined benefit retirement program of the Florida Retirement
 3207  System. Upon such transfer, all service credit previously earned
 3208  under the pension plan is defined benefit program of the Florida
 3209  Retirement System shall be nullified for purposes of entitlement
 3210  to a future benefit under the pension plan defined benefit
 3211  program of the Florida Retirement System. A member may not
 3212  transfer participant is precluded from transferring the
 3213  accumulated benefit obligation balance from the pension plan
 3214  after the time defined benefit program upon the expiration of
 3215  the period for enrolling afforded to enroll in the investment
 3216  plan has expired optional program.
 3217         1.2. For purposes of this subsection, the present value of
 3218  the member’s accumulated benefit obligation is based upon the
 3219  member’s estimated creditable service and estimated average
 3220  final compensation under the pension plan defined benefit
 3221  program, subject to recomputation under subparagraph 2. 3. For
 3222  state employees enrolling under subparagraph (4)(a)1., initial
 3223  estimates shall will be based upon creditable service and
 3224  average final compensation as of midnight on June 30, 2002; for
 3225  district school board employees enrolling under subparagraph
 3226  (4)(b)1., initial estimates shall will be based upon creditable
 3227  service and average final compensation as of midnight on
 3228  September 30, 2002; and for local government employees enrolling
 3229  under subparagraph (4)(c)1., initial estimates shall will be
 3230  based upon creditable service and average final compensation as
 3231  of midnight on December 31, 2002. The dates respectively
 3232  specified are above shall be construed as the “estimate date”
 3233  for these employees. The actuarial present value of the
 3234  employee’s accumulated benefit obligation shall be based on the
 3235  following:
 3236         a. The discount rate and other relevant actuarial
 3237  assumptions used to value the Florida Retirement System Trust
 3238  Fund at the time the amount to be transferred is determined,
 3239  consistent with the factors provided in sub-subparagraphs b. and
 3240  c.
 3241         b. A benefit commencement age, based on the member’s
 3242  estimated creditable service as of the estimate date.
 3243         c. Except as provided under sub-subparagraph d., for a
 3244  member initially enrolled:
 3245         (I) Before July 1, 2011, the benefit commencement age is
 3246  shall be the younger of the following, but may shall not be
 3247  younger than the member’s age as of the estimate date:
 3248         (A)(I) Age 62; or
 3249         (B)(II) The age the member would attain if the member
 3250  completed 30 years of service with an employer, assuming the
 3251  member worked continuously from the estimate date, and
 3252  disregarding any vesting requirement that would otherwise apply
 3253  under the pension plan defined benefit program of the Florida
 3254  Retirement System.
 3255         (II) On or after July 1, 2011, the benefit commencement age
 3256  is the younger of the following, but may not be younger than the
 3257  member’s age as of the estimate date:
 3258         (A) Age 65; or
 3259         (B) The age the member would attain if the member completed
 3260  33 years of service with an employer, assuming the member worked
 3261  continuously from the estimate date, and disregarding any
 3262  vesting requirement that would otherwise apply under the pension
 3263  plan.
 3264         d.c. For members of the Special Risk Class and for members
 3265  of the Special Risk Administrative Support Class entitled to
 3266  retain the special risk normal retirement date:
 3267         (I) Initially enrolled before July 1, 2011, the benefit
 3268  commencement age is shall be the younger of the following, but
 3269  may shall not be younger than the member’s age as of the
 3270  estimate date:
 3271         (A)(I) Age 55; or
 3272         (B)(II) The age the member would attain if the member
 3273  completed 25 years of service with an employer, assuming the
 3274  member worked continuously from the estimate date, and
 3275  disregarding any vesting requirement that would otherwise apply
 3276  under the pension plan defined benefit program of the Florida
 3277  Retirement System.
 3278         (II) Initially enrolled on or after July 1, 2011, the
 3279  benefit commencement age is the younger of the following, but
 3280  may not be younger than the member’s age as of the estimate
 3281  date:
 3282         (A) Age 60; or
 3283         (B) The age the member would attain if the member completed
 3284  30 years of service with an employer, assuming the member worked
 3285  continuously from the estimate date, and disregarding any
 3286  vesting requirement that would otherwise apply under the pension
 3287  plan.
 3288         e.d. The calculation must shall disregard vesting
 3289  requirements and early retirement reduction factors that would
 3290  otherwise apply under the pension plan defined benefit
 3291  retirement program.
 3292         2.3. For each member participant who elects to transfer
 3293  moneys from the pension plan defined benefit program to his or
 3294  her account in the investment plan optional program, the
 3295  division shall recompute the amount transferred under
 3296  subparagraph 1. within 2. not later than 60 days after the
 3297  actual transfer of funds based upon the member’s participant’s
 3298  actual creditable service and actual final average compensation
 3299  as of the initial date of participation in the investment plan
 3300  optional program. If the recomputed amount differs from the
 3301  amount transferred under subparagraph 2. by $10 or more, the
 3302  division shall:
 3303         a. Transfer, or cause to be transferred, from the Florida
 3304  Retirement System Trust Fund to the member’s participant’s
 3305  account in the optional program the excess, if any, of the
 3306  recomputed amount over the previously transferred amount
 3307  together with interest from the initial date of transfer to the
 3308  date of transfer under this subparagraph, based upon the
 3309  effective annual interest equal to the assumed return on the
 3310  actuarial investment which was used in the most recent actuarial
 3311  valuation of the system, compounded annually.
 3312         b. Transfer, or cause to be transferred, from the member’s
 3313  participant’s account to the Florida Retirement System Trust
 3314  Fund the excess, if any, of the previously transferred amount
 3315  over the recomputed amount, together with interest from the
 3316  initial date of transfer to the date of transfer under this
 3317  subparagraph, based upon 6 percent effective annual interest,
 3318  compounded annually, pro rata based on the member’s
 3319  participant’s allocation plan.
 3320         3. If contribution adjustments are made as a result of
 3321  employer errors or corrections, including plan corrections,
 3322  following recomputation of the amount transferred under
 3323  subparagraph 1., the member is entitled to the additional
 3324  contributions or is responsible for returning any excess
 3325  contributions resulting from the correction. However, any return
 3326  of such erroneous excess pretax contribution by the plan must be
 3327  made within the period allowed by the Internal Revenue Service.
 3328  The present value of the member’s accumulated benefit obligation
 3329  shall not be recalculated.
 3330         4. As directed by the member participant, the state board
 3331  shall transfer or cause to be transferred the appropriate
 3332  amounts to the designated accounts within. The board shall
 3333  establish transfer procedures by rule, but the actual transfer
 3334  shall not be later than 30 days after the effective date of the
 3335  member’s participation in the investment plan optional program
 3336  unless the major financial markets for securities available for
 3337  a transfer are seriously disrupted by an unforeseen event that
 3338  which also causes the suspension of trading on any national
 3339  securities exchange in the country where the securities were
 3340  issued. In that event, the such 30-day period of time may be
 3341  extended by a resolution of the state board trustees. Transfers
 3342  are not commissionable or subject to other fees and may be in
 3343  the form of securities or cash, as determined by the state
 3344  board. Such securities are shall be valued as of the date of
 3345  receipt in the member’s participant’s account.
 3346         5. If the state board or the division receives notification
 3347  from the United States Internal Revenue Service that this
 3348  paragraph or any portion of this paragraph will cause the
 3349  retirement system, or a portion thereof, to be disqualified for
 3350  tax purposes under the Internal Revenue Code, then the portion
 3351  that will cause the disqualification does not apply. Upon such
 3352  notice, the state board and the division shall notify the
 3353  presiding officers of the Legislature.
 3354         (4) PARTICIPATION; ENROLLMENT.—
 3355         (a)1. With respect to an eligible employee who is employed
 3356  in a regularly established position on June 1, 2002, by a state
 3357  employer:
 3358         a. Any such employee may elect to participate in the
 3359  investment plan Public Employee Optional Retirement Program in
 3360  lieu of retaining his or her membership in the pension plan
 3361  defined benefit program of the Florida Retirement System. The
 3362  election must be made in writing or by electronic means and must
 3363  be filed with the third-party administrator by August 31, 2002,
 3364  or, in the case of an active employee who is on a leave of
 3365  absence on April 1, 2002, by the last business day of the 5th
 3366  month following the month the leave of absence concludes. This
 3367  election is irrevocable, except as provided in paragraph (g)
 3368  (e). Upon making such election, the employee shall be enrolled
 3369  as a member participant of the investment plan Public Employee
 3370  Optional Retirement Program, the employee’s membership in the
 3371  Florida Retirement System is shall be governed by the provisions
 3372  of this part, and the employee’s membership in the pension plan
 3373  terminates defined benefit program of the Florida Retirement
 3374  System shall terminate. The employee’s enrollment in the
 3375  investment plan is Public Employee Optional Retirement Program
 3376  shall be effective the first day of the month for which a full
 3377  month’s employer contribution is made to the investment plan
 3378  optional program.
 3379         b. Any such employee who fails to elect to participate in
 3380  the investment plan Public Employee Optional Retirement Program
 3381  within the prescribed time period is deemed to have elected to
 3382  retain membership in the pension plan defined benefit program of
 3383  the Florida Retirement System, and the employee’s option to
 3384  elect to participate in the investment plan optional program is
 3385  forfeited.
 3386         2. With respect to employees who become eligible to
 3387  participate in the investment plan Public Employee Optional
 3388  Retirement Program by reason of employment in a regularly
 3389  established position with a state employer commencing after
 3390  April 1, 2002:
 3391         a. Any such employee shall, by default, be enrolled in the
 3392  pension plan defined benefit retirement program of the Florida
 3393  Retirement System at the commencement of employment, and may, by
 3394  the last business day of the 5th month following the employee’s
 3395  month of hire, elect to participate in the investment plan
 3396  Public Employee Optional Retirement Program. The employee’s
 3397  election must be made in writing or by electronic means and must
 3398  be filed with the third-party administrator. The election to
 3399  participate in the investment plan optional program is
 3400  irrevocable, except as provided in paragraph (g) (e).
 3401         b. If the employee files such election within the
 3402  prescribed time period, enrollment in the investment plan is
 3403  optional program shall be effective on the first day of
 3404  employment. The employer retirement contributions paid through
 3405  the month of the employee plan change shall be transferred to
 3406  the investment optional program, and, effective the first day of
 3407  the next month, the employer and employee must shall pay the
 3408  applicable contributions based on the employee membership class
 3409  in the optional program.
 3410         c. An Any such employee who fails to elect to participate
 3411  in the investment plan Public Employee Optional Retirement
 3412  Program within the prescribed time period is deemed to have
 3413  elected to retain membership in the pension plan defined benefit
 3414  program of the Florida Retirement System, and the employee’s
 3415  option to elect to participate in the investment plan optional
 3416  program is forfeited.
 3417         3. With respect to employees who become eligible to
 3418  participate in the investment plan Public Employee Optional
 3419  Retirement Program pursuant to s. 121.051(2)(c)3. or s.
 3420  121.35(3)(i), the any such employee may elect to participate in
 3421  the investment plan Public Employee Optional Retirement Program
 3422  in lieu of retaining his or her membership participation in the
 3423  State Community College System Optional Retirement Program or
 3424  the State University System Optional Retirement Program. The
 3425  election must be made in writing or by electronic means and must
 3426  be filed with the third-party administrator. This election is
 3427  irrevocable, except as provided in paragraph (g) (e). Upon
 3428  making such election, the employee shall be enrolled as a member
 3429  in participant of the investment plan Public Employee Optional
 3430  Retirement Program, the employee’s membership in the Florida
 3431  Retirement System is shall be governed by the provisions of this
 3432  part, and the employee’s participation in the State Community
 3433  College System Optional Retirement Program or the State
 3434  University System Optional Retirement Program terminates shall
 3435  terminate. The employee’s enrollment in the investment plan is
 3436  Public Employee Optional Retirement Program shall be effective
 3437  on the first day of the month for which a full month’s employer
 3438  and employee contribution is made to the investment plan
 3439  optional program.
 3440         4. For purposes of this paragraph, “state employer” means
 3441  any agency, board, branch, commission, community college,
 3442  department, institution, institution of higher education, or
 3443  water management district of the state, which participates in
 3444  the Florida Retirement System for the benefit of certain
 3445  employees.
 3446         (b)1. With respect to an eligible employee who is employed
 3447  in a regularly established position on September 1, 2002, by a
 3448  district school board employer:
 3449         a. Any such employee may elect to participate in the
 3450  investment plan Public Employee Optional Retirement Program in
 3451  lieu of retaining his or her membership in the pension plan
 3452  defined benefit program of the Florida Retirement System. The
 3453  election must be made in writing or by electronic means and must
 3454  be filed with the third-party administrator by November 30, or,
 3455  in the case of an active employee who is on a leave of absence
 3456  on July 1, 2002, by the last business day of the 5th month
 3457  following the month the leave of absence concludes. This
 3458  election is irrevocable, except as provided in paragraph (g)
 3459  (e). Upon making such election, the employee shall be enrolled
 3460  as a member participant of the investment plan Public Employee
 3461  Optional Retirement Program, the employee’s membership in the
 3462  Florida Retirement System is shall be governed by the provisions
 3463  of this part, and the employee’s membership in the pension plan
 3464  terminates defined benefit program of the Florida Retirement
 3465  System shall terminate. The employee’s enrollment in the
 3466  investment plan is Public Employee Optional Retirement Program
 3467  shall be effective the first day of the month for which a full
 3468  month’s employer contribution is made to the investment optional
 3469  program.
 3470         b. Any such employee who fails to elect to participate in
 3471  the investment plan Public Employee Optional Retirement Program
 3472  within the prescribed time period is deemed to have elected to
 3473  retain membership in the pension plan defined benefit program of
 3474  the Florida Retirement System, and the employee’s option to
 3475  elect to participate in the investment plan optional program is
 3476  forfeited.
 3477         2. With respect to employees who become eligible to
 3478  participate in the investment plan Public Employee Optional
 3479  Retirement Program by reason of employment in a regularly
 3480  established position with a district school board employer
 3481  commencing after July 1, 2002:
 3482         a. Any such employee shall, by default, be enrolled in the
 3483  pension plan defined benefit retirement program of the Florida
 3484  Retirement System at the commencement of employment, and may, by
 3485  the last business day of the 5th month following the employee’s
 3486  month of hire, elect to participate in the investment plan
 3487  Public Employee Optional Retirement Program. The employee’s
 3488  election must be made in writing or by electronic means and must
 3489  be filed with the third-party administrator. The election to
 3490  participate in the investment plan optional program is
 3491  irrevocable, except as provided in paragraph (g) (e).
 3492         b. If the employee files such election within the
 3493  prescribed time period, enrollment in the investment plan is
 3494  optional program shall be effective on the first day of
 3495  employment. The employer retirement contributions paid through
 3496  the month of the employee plan change shall be transferred to
 3497  the investment plan optional program, and, effective the first
 3498  day of the next month, the employer shall pay the applicable
 3499  contributions based on the employee membership class in the
 3500  investment plan optional program.
 3501         c. Any such employee who fails to elect to participate in
 3502  the investment plan Public Employee Optional Retirement Program
 3503  within the prescribed time period is deemed to have elected to
 3504  retain membership in the pension plan defined benefit program of
 3505  the Florida Retirement System, and the employee’s option to
 3506  elect to participate in the investment plan optional program is
 3507  forfeited.
 3508         3. For purposes of this paragraph, “district school board
 3509  employer” means any district school board that participates in
 3510  the Florida Retirement System for the benefit of certain
 3511  employees, or a charter school or charter technical career
 3512  center that participates in the Florida Retirement System as
 3513  provided in s. 121.051(2)(d).
 3514         (c)1. With respect to an eligible employee who is employed
 3515  in a regularly established position on December 1, 2002, by a
 3516  local employer:
 3517         a. Any such employee may elect to participate in the
 3518  investment plan Public Employee Optional Retirement Program in
 3519  lieu of retaining his or her membership in the pension plan
 3520  defined benefit program of the Florida Retirement System. The
 3521  election must be made in writing or by electronic means and must
 3522  be filed with the third-party administrator by February 28,
 3523  2003, or, in the case of an active employee who is on a leave of
 3524  absence on October 1, 2002, by the last business day of the 5th
 3525  month following the month the leave of absence concludes. This
 3526  election is irrevocable, except as provided in paragraph (g)
 3527  (e). Upon making such election, the employee shall be enrolled
 3528  as a participant of the investment plan Public Employee Optional
 3529  Retirement Program, the employee’s membership in the Florida
 3530  Retirement System is shall be governed by the provisions of this
 3531  part, and the employee’s membership in the pension plan
 3532  terminates defined benefit program of the Florida Retirement
 3533  System shall terminate. The employee’s enrollment in the
 3534  investment plan is Public Employee Optional Retirement Program
 3535  shall be effective the first day of the month for which a full
 3536  month’s employer contribution is made to the investment plan
 3537  optional program.
 3538         b. Any such employee who fails to elect to participate in
 3539  the investment plan Public Employee Optional Retirement Program
 3540  within the prescribed time period is deemed to have elected to
 3541  retain membership in the pension plan defined benefit program of
 3542  the Florida Retirement System, and the employee’s option to
 3543  elect to participate in the investment plan optional program is
 3544  forfeited.
 3545         2. With respect to employees who become eligible to
 3546  participate in the investment plan Public Employee Optional
 3547  Retirement Program by reason of employment in a regularly
 3548  established position with a local employer commencing after
 3549  October 1, 2002:
 3550         a. Any such employee shall, by default, be enrolled in the
 3551  pension plan defined benefit retirement program of the Florida
 3552  Retirement System at the commencement of employment, and may, by
 3553  the last business day of the 5th month following the employee’s
 3554  month of hire, elect to participate in the investment plan
 3555  Public Employee Optional Retirement Program. The employee’s
 3556  election must be made in writing or by electronic means and must
 3557  be filed with the third-party administrator. The election to
 3558  participate in the investment plan optional program is
 3559  irrevocable, except as provided in paragraph (g) (e).
 3560         b. If the employee files such election within the
 3561  prescribed time period, enrollment in the investment plan is
 3562  optional program shall be effective on the first day of
 3563  employment. The employer retirement contributions paid through
 3564  the month of the employee plan change shall be transferred to
 3565  the investment plan optional program, and, effective the first
 3566  day of the next month, the employer shall pay the applicable
 3567  contributions based on the employee membership class in the
 3568  investment plan optional program.
 3569         c. Any such employee who fails to elect to participate in
 3570  the investment plan Public Employee Optional Retirement Program
 3571  within the prescribed time period is deemed to have elected to
 3572  retain membership in the pension plan defined benefit program of
 3573  the Florida Retirement System, and the employee’s option to
 3574  elect to participate in the investment plan optional program is
 3575  forfeited.
 3576         3. For purposes of this paragraph, “local employer” means
 3577  any employer not included in paragraph (a) or paragraph (b).
 3578         (d) Contributions available for self-direction by a member
 3579  participant who has not selected one or more specific investment
 3580  products shall be allocated as prescribed by the state board.
 3581  The third-party administrator shall notify the member any such
 3582  participant at least quarterly that the member participant
 3583  should take an affirmative action to make an asset allocation
 3584  among the investment optional program products.
 3585         (e) On or after July 1, 2011, a member of the pension plan
 3586  who obtains a refund of employee contributions retains his or
 3587  her prior plan choice upon return to employment in a regularly
 3588  established position with a participating employer.
 3589         (f) A member of the investment plan who takes a
 3590  distribution of any contributions from his or her investment
 3591  plan account is considered a retiree. A retiree who is initially
 3592  reemployed on or after July 1, 2010, is not eligible for renewed
 3593  membership.
 3594         (g)(e) After the period during which an eligible employee
 3595  had the choice to elect the pension plan defined benefit program
 3596  or the investment plan optional retirement program, or the month
 3597  following the receipt of the eligible employee’s plan election,
 3598  if sooner, the employee shall have one opportunity, at the
 3599  employee’s discretion, to choose to move from the pension plan
 3600  defined benefit program to the investment plan optional
 3601  retirement program or from the investment plan optional
 3602  retirement program to the pension plan defined benefit program.
 3603  Eligible employees may elect to move between plans Florida
 3604  Retirement System programs only if they are earning service
 3605  credit in an employer-employee relationship consistent with s.
 3606  121.021(17)(b), excluding leaves of absence without pay.
 3607  Effective July 1, 2005, such elections are effective on the
 3608  first day of the month following the receipt of the election by
 3609  the third-party administrator and are not subject to the
 3610  requirements regarding an employer-employee relationship or
 3611  receipt of contributions for the eligible employee in the
 3612  effective month, except when the election is received by the
 3613  third-party administrator. This paragraph is contingent upon
 3614  approval by from the Internal Revenue Service for including the
 3615  choice described herein within the programs offered by the
 3616  Florida Retirement System.
 3617         1. If the employee chooses to move to the investment plan
 3618  optional retirement program, the applicable provisions of
 3619  subsection (3) this section shall govern the transfer.
 3620         2. If the employee chooses to move to the pension plan
 3621  defined benefit program, the employee must transfer from his or
 3622  her investment plan optional retirement program account, and
 3623  from other employee moneys as necessary, a sum representing the
 3624  present value of that employee’s accumulated benefit obligation
 3625  immediately following the time of such movement, determined
 3626  assuming that attained service equals the sum of service in the
 3627  pension plan defined benefit program and service in the
 3628  investment plan optional retirement program. Benefit
 3629  commencement occurs on the first date the employee is eligible
 3630  for unreduced benefits, using the discount rate and other
 3631  relevant actuarial assumptions that were used to value the
 3632  pension defined benefit plan liabilities in the most recent
 3633  actuarial valuation. For any employee who, at the time of the
 3634  second election, already maintains an accrued benefit amount in
 3635  the pension plan defined benefit program, the then-present value
 3636  of the accrued benefit is shall be deemed part of the required
 3637  transfer amount. The division must shall ensure that the
 3638  transfer sum is prepared using a formula and methodology
 3639  certified by an enrolled actuary. A refund of any employee
 3640  contributions or additional member payments made which exceed
 3641  the employee contributions that would have accrued had the
 3642  member remained in the pension plan and not transferred to the
 3643  investment plan is not permitted.
 3644         3. Notwithstanding subparagraph 2., an employee who chooses
 3645  to move to the pension plan defined benefit program and who
 3646  became eligible to participate in the investment plan optional
 3647  retirement program by reason of employment in a regularly
 3648  established position with a state employer after June 1, 2002; a
 3649  district school board employer after September 1, 2002; or a
 3650  local employer after December 1, 2002, must transfer from his or
 3651  her investment plan optional retirement program account, and
 3652  from other employee moneys as necessary, a sum representing the
 3653  employee’s actuarial accrued liability. A refund of any employee
 3654  contributions or additional participant payments made which
 3655  exceed the employee contributions that would have accrued had
 3656  the member remained in the pension plan and not transferred to
 3657  the investment plan is not permitted.
 3658         4. An employee’s ability to transfer from the pension plan
 3659  defined benefit program to the investment plan optional
 3660  retirement program pursuant to paragraphs (a)-(d), and the
 3661  ability of a current employee to have an option to later
 3662  transfer back into the pension plan defined benefit program
 3663  under subparagraph 2., shall be deemed a significant system
 3664  amendment. Pursuant to s. 121.031(4), any resulting unfunded
 3665  liability arising from actual original transfers from the
 3666  pension plan defined benefit program to the investment plan
 3667  optional program must be amortized within 30 plan years as a
 3668  separate unfunded actuarial base independent of the reserve
 3669  stabilization mechanism defined in s. 121.031(3)(f). For the
 3670  first 25 years, a direct amortization payment may not be
 3671  calculated for this base. During this 25-year period, the
 3672  separate base shall be used to offset the impact of employees
 3673  exercising their second program election under this paragraph.
 3674  It is the intent of the Legislature that The actuarial funded
 3675  status of the pension plan will defined benefit program not be
 3676  affected by such second program elections in any significant
 3677  manner, after due recognition of the separate unfunded actuarial
 3678  base. Following the initial 25-year period, any remaining
 3679  balance of the original separate base shall be amortized over
 3680  the remaining 5 years of the required 30-year amortization
 3681  period.
 3682         5. If the employee chooses to transfer from the investment
 3683  plan optional retirement program to the pension plan defined
 3684  benefit program and retains an excess account balance in the
 3685  investment plan optional program after satisfying the buy-in
 3686  requirements under this paragraph, the excess may not be
 3687  distributed until the member retires from the pension plan
 3688  defined benefit program. The excess account balance may be
 3689  rolled over to the pension plan defined benefit program and used
 3690  to purchase service credit or upgrade creditable service in the
 3691  pension plan that program.
 3692         (5) CONTRIBUTIONS.—
 3693         (a) The employee and Each employer shall make the required
 3694  contributions to contribute on behalf of each participant in the
 3695  investment plan based on a percentage of the employee’s gross
 3696  monthly compensation Public Employee Optional Retirement
 3697  Program, as provided in part III of this chapter.
 3698         (b) Employee contributions shall be paid as provided in s.
 3699  121.71.
 3700         (c) The state board, acting as plan fiduciary, must shall
 3701  ensure that all plan assets are held in a trust, pursuant to s.
 3702  401 of the Internal Revenue Code. The fiduciary must shall
 3703  ensure that such said contributions are allocated as follows:
 3704         1. The employer and employee contribution portion earmarked
 3705  for member participant accounts shall be used to purchase
 3706  interests in the appropriate investment vehicles for the
 3707  accounts of each participant as specified by the member
 3708  participant, or in accordance with paragraph (4)(d).
 3709         2. The employer contribution portion earmarked for
 3710  administrative and educational expenses shall be transferred to
 3711  the Florida Retirement System Investment Plan Trust Fund board.
 3712         3. The employer contribution portion earmarked for
 3713  disability benefits shall be transferred to the Florida
 3714  Retirement System Trust Fund department.
 3715         (d)(b)The third-party administrator is Employers are
 3716  responsible for monitoring and notifying employers of the
 3717  participants regarding maximum contribution levels allowed for
 3718  members permitted under the Internal Revenue Code. If a member
 3719  participant contributes to any other tax-deferred plan, the
 3720  member he or she is responsible for ensuring that total
 3721  contributions made to the investment plan optional program and
 3722  to any other such plan do not exceed federally permitted
 3723  maximums.
 3724         (e)(c) The investment plan Public Employee Optional
 3725  Retirement Program may accept for deposit into member
 3726  participant accounts contributions in the form of rollovers or
 3727  direct trustee-to-trustee transfers by or on behalf of members
 3728  participants, reasonably determined by the state board to be
 3729  eligible for rollover or transfer to the investment plan
 3730  optional retirement program pursuant to the Internal Revenue
 3731  Code, if such contributions are made in accordance with rules as
 3732  may be adopted by the board. Such contributions must shall be
 3733  accounted for in accordance with any applicable Internal Revenue
 3734  Code requirements and rules of the state board.
 3735         (6) VESTING REQUIREMENTS.—
 3736         (a) A member is fully and immediately vested in all
 3737  employee contributions paid to the investment plan as provided
 3738  in s. 121.71, plus interest and earnings thereon and less
 3739  investment fees and administrative charges.
 3740         (b)(a)1. With respect to employer contributions paid on
 3741  behalf of the member participant to the investment plan optional
 3742  retirement program, plus interest and earnings thereon and less
 3743  investment fees and administrative charges, a member participant
 3744  is vested after completing 1 work year with an employer,
 3745  including any service while the member participant was a member
 3746  of the pension plan defined benefit program or an optional
 3747  retirement program authorized under s. 121.051(2)(c) or s.
 3748  121.055(6).
 3749         2. If the member participant terminates employment before
 3750  satisfying the vesting requirements, the nonvested accumulation
 3751  must be transferred from the member’s participant’s accounts to
 3752  the state board for deposit and investment by the state board in
 3753  its the suspense account created within the Florida Retirement
 3754  System Investment Plan Public Employee Optional Retirement
 3755  Program Trust Fund. If the terminated member participant is
 3756  reemployed as an eligible employee within 5 years, the state
 3757  board shall transfer to the member’s participant’s account any
 3758  amount previously transferred from the member’s participant’s
 3759  accounts to the suspense account, plus actual earnings on such
 3760  amount while in the suspense account.
 3761         (c)(b)1. With respect to amounts contributed by an employer
 3762  and transferred from the pension plan defined benefit program to
 3763  the investment plan program, plus interest and earnings, and
 3764  less investment fees and administrative charges, a member
 3765  participant shall be vested in the amount transferred upon
 3766  meeting the vesting service requirements for the member’s
 3767  participant’s membership class as set forth in s. 121.021(45)
 3768  121.021(29). The third-party administrator shall account for
 3769  such amounts for each member participant. The division shall
 3770  notify the member participant and the third-party administrator
 3771  when the member participant has satisfied the vesting period for
 3772  Florida Retirement System purposes.
 3773         2. If the member participant terminates employment before
 3774  satisfying the vesting requirements, the nonvested accumulation
 3775  must be transferred from the member’s participant’s accounts to
 3776  the state board for deposit and investment by the state board in
 3777  the suspense account created within the Florida Retirement
 3778  System Investment Plan Public Employee Optional Retirement
 3779  Program Trust Fund. If the terminated member participant is
 3780  reemployed as an eligible employee within 5 years, the state
 3781  board shall transfer to the member’s accounts participant’s
 3782  account any amount previously transferred from the member’s
 3783  participant’s accounts to the suspense account, plus the actual
 3784  earnings on such amount while in the suspense account.
 3785         (d)(c) Any nonvested accumulations transferred from a
 3786  member’s participant’s account to the state board’s suspense
 3787  account shall be forfeited, including accompanying service
 3788  credit, by the member participant if the member participant is
 3789  not reemployed as an eligible employee within 5 years after
 3790  termination.
 3791         (e) If the member elects to receive any of his or her
 3792  vested employee or employer contributions upon termination of
 3793  employment as provided in s. 121.021(39)(a), except for a
 3794  mandatory distribution of a de minimis account authorized by the
 3795  state board or a minimum required distribution provided by s.
 3796  401(a)(9) of the Internal Revenue Code, the member shall forfeit
 3797  all nonvested employer contributions, and accompanying service
 3798  credit, paid on behalf of the member to the investment plan.
 3799         (7) BENEFITS.—Under the investment plan, benefits must
 3800  Public Employee Optional Retirement Program:
 3801         (a) Benefits shall Be provided in accordance with s. 401(a)
 3802  of the Internal Revenue Code.
 3803         (b) Benefits shall Accrue in individual accounts that are
 3804  member-directed participant-directed, portable, and funded by
 3805  employer and employee contributions and earnings thereon.
 3806         (c) Benefits shall Be payable in accordance with the
 3807  provisions of s. 121.591.
 3808         (8) INVESTMENT PLAN ADMINISTRATION OF PROGRAM.—
 3809         (a) The investment plan optional retirement program shall
 3810  be administered by the state board and affected employers. The
 3811  state board may require oaths, by affidavit or otherwise, and
 3812  acknowledgments from persons in connection with the
 3813  administration of its statutory duties and responsibilities for
 3814  the investment plan this program. An oath, by affidavit or
 3815  otherwise, may not be required of a member an employee
 3816  participant at the time of enrollment. Acknowledgment of an
 3817  employee’s election to participate in the program shall be no
 3818  greater than necessary to confirm the employee’s election. The
 3819  state board shall adopt rules to carry out its statutory duties
 3820  with respect to administering the investment plan optional
 3821  retirement program, including establishing the roles and
 3822  responsibilities of affected state, local government, and
 3823  education-related employers, the state board, the department,
 3824  and third-party contractors. The department shall adopt rules
 3825  necessary to administer the investment plan optional program in
 3826  coordination with the pension plan defined benefit program and
 3827  the disability benefits available under the investment plan
 3828  optional program.
 3829         (a)(b)1. The state board shall select and contract with a
 3830  one third-party administrator to provide administrative services
 3831  if those services cannot be competitively and contractually
 3832  provided by the division of Retirement within the Department of
 3833  Management Services. With the approval of the state board, the
 3834  third-party administrator may subcontract with other
 3835  organizations or individuals to provide components of the
 3836  administrative services. As a cost of administration, the state
 3837  board may compensate any such contractor for its services, in
 3838  accordance with the terms of the contract, as is deemed
 3839  necessary or proper by the board. The third-party administrator
 3840  may not be an approved provider or be affiliated with an
 3841  approved provider.
 3842         2. These administrative services may include, but are not
 3843  limited to, enrollment of eligible employees, collection of
 3844  employer and employee contributions, disbursement of such
 3845  contributions to approved providers in accordance with the
 3846  allocation directions of members participants; services relating
 3847  to consolidated billing; individual and collective recordkeeping
 3848  and accounting; asset purchase, control, and safekeeping; and
 3849  direct disbursement of funds to and from the third-party
 3850  administrator, the division, the state board, employers, members
 3851  participants, approved providers, and beneficiaries. This
 3852  section does not prevent or prohibit a bundled provider from
 3853  providing any administrative or customer service, including
 3854  accounting and administration of individual member participant
 3855  benefits and contributions; individual member participant
 3856  recordkeeping; asset purchase, control, and safekeeping; direct
 3857  execution of the member’s participant’s instructions as to asset
 3858  and contribution allocation; calculation of daily net asset
 3859  values; direct access to member participant account information;
 3860  or periodic reporting to members participants, at least
 3861  quarterly, on account balances and transactions, if these
 3862  services are authorized by the state board as part of the
 3863  contract.
 3864         (b)1.3. The state board shall select and contract with one
 3865  or more organizations to provide educational services. With
 3866  approval of the state board, the organizations may subcontract
 3867  with other organizations or individuals to provide components of
 3868  the educational services. As a cost of administration, the state
 3869  board may compensate any such contractor for its services in
 3870  accordance with the terms of the contract, as is deemed
 3871  necessary or proper by the board. The education organization may
 3872  not be an approved provider or be affiliated with an approved
 3873  provider.
 3874         2.4. Educational services shall be designed by the state
 3875  board and department to assist employers, eligible employees,
 3876  members participants, and beneficiaries in order to maintain
 3877  compliance with United States Department of Labor regulations
 3878  under s. 404(c) of the Employee Retirement Income Security Act
 3879  of 1974 and to assist employees in their choice of pension plan
 3880  defined benefit or investment plan defined contribution
 3881  retirement alternatives. Educational services include, but are
 3882  not limited to, disseminating educational materials; providing
 3883  retirement planning education; explaining the pension
 3884  differences between the defined benefit retirement plan and the
 3885  investment defined contribution retirement plan; and offering
 3886  financial planning guidance on matters such as investment
 3887  diversification, investment risks, investment costs, and asset
 3888  allocation. An approved provider may also provide educational
 3889  information, including retirement planning and investment
 3890  allocation information concerning its products and services.
 3891         (c)1. In evaluating and selecting a third-party
 3892  administrator, the state board shall establish criteria for
 3893  evaluating under which it shall consider the relative
 3894  capabilities and qualifications of each proposed administrator.
 3895  In developing such criteria, the state board shall consider:
 3896         a. The administrator’s demonstrated experience in providing
 3897  administrative services to public or private sector retirement
 3898  systems.
 3899         b. The administrator’s demonstrated experience in providing
 3900  daily valued recordkeeping to defined contribution programs
 3901  plans.
 3902         c. The administrator’s ability and willingness to
 3903  coordinate its activities with the Florida Retirement System
 3904  employers, the state board, and the division, and to supply to
 3905  such employers, the board, and the division the information and
 3906  data they require, including, but not limited to, monthly
 3907  management reports, quarterly member participant reports, and ad
 3908  hoc reports requested by the department or state board.
 3909         d. The cost-effectiveness and levels of the administrative
 3910  services provided.
 3911         e. The administrator’s ability to interact with the members
 3912  participants, the employers, the state board, the division, and
 3913  the providers; the means by which members participants may
 3914  access account information, direct investment of contributions,
 3915  make changes to their accounts, transfer moneys between
 3916  available investment vehicles, and transfer moneys between
 3917  investment products; and any fees that apply to such activities.
 3918         f. Any other factor deemed necessary by the Trustees of the
 3919  state board of Administration.
 3920         2. In evaluating and selecting an educational provider, the
 3921  state board shall establish criteria under which it shall
 3922  consider the relative capabilities and qualifications of each
 3923  proposed educational provider. In developing such criteria, the
 3924  state board shall consider:
 3925         a. Demonstrated experience in providing educational
 3926  services to public or private sector retirement systems.
 3927         b. Ability and willingness to coordinate its activities
 3928  with the Florida Retirement System employers, the state board,
 3929  and the division, and to supply to such employers, the board,
 3930  and the division the information and data they require,
 3931  including, but not limited to, reports on educational contacts.
 3932         c. The cost-effectiveness and levels of the educational
 3933  services provided.
 3934         d. Ability to provide educational services via different
 3935  media, including, but not limited to, the Internet, personal
 3936  contact, seminars, brochures, and newsletters.
 3937         e. Any other factor deemed necessary by the Trustees of the
 3938  state board of Administration.
 3939         3. The establishment of the criteria shall be solely within
 3940  the discretion of the state board.
 3941         (d) The state board shall develop the form and content of
 3942  any contracts to be offered under the investment plan Public
 3943  Employee Optional Retirement Program. In developing the its
 3944  contracts, the board shall must consider:
 3945         1. The nature and extent of the rights and benefits to be
 3946  afforded in relation to the required contributions required
 3947  under the plan program.
 3948         2. The suitability of the rights and benefits provided to
 3949  be afforded and the interests of employers in the recruitment
 3950  and retention of eligible employees.
 3951         (e)1. The state board may contract with any consultant for
 3952  professional services, including legal, consulting, accounting,
 3953  and actuarial services, deemed necessary to implement and
 3954  administer the investment plan optional program by the Trustees
 3955  of the State Board of Administration. The state board may enter
 3956  into a contract with one or more vendors to provide low-cost
 3957  investment advice to members participants, supplemental to
 3958  education provided by the third-party administrator. All fees
 3959  under any such contract shall be paid by those members
 3960  participants who choose to use the services of the vendor.
 3961         2. The department may contract with consultants for
 3962  professional services, including legal, consulting, accounting,
 3963  and actuarial services, deemed necessary to implement and
 3964  administer the investment plan optional program in coordination
 3965  with the pension plan defined benefit program of the Florida
 3966  Retirement System. The department, in coordination with the
 3967  state board, may enter into a contract with the third-party
 3968  administrator in order to coordinate services common to the
 3969  various programs within the Florida Retirement System.
 3970         (f) The third-party administrator may shall not receive
 3971  direct or indirect compensation from an approved provider,
 3972  except as specifically provided for in the contract with the
 3973  state board.
 3974         (g) The state board shall receive and resolve member
 3975  participant complaints against the program, the third-party
 3976  administrator, or any program vendor or provider; shall resolve
 3977  any conflict between the third-party administrator and an
 3978  approved provider if such conflict threatens the implementation
 3979  or administration of the program or the quality of services to
 3980  employees; and may resolve any other conflicts. The third-party
 3981  administrator shall retain all member participant records for at
 3982  least 5 years for use in resolving any member participant
 3983  conflicts. The state board, the third-party administrator, or a
 3984  provider is not required to produce documentation or an audio
 3985  recording to justify action taken with regard to a member
 3986  participant if the action occurred 5 or more years before the
 3987  complaint is submitted to the state board. It is presumed that
 3988  all action taken 5 or more years before the complaint is
 3989  submitted was taken at the request of the member participant and
 3990  with the member’s participant’s full knowledge and consent. To
 3991  overcome this presumption, the member participant must present
 3992  documentary evidence or an audio recording demonstrating
 3993  otherwise.
 3994         (9) INVESTMENT OPTIONS OR PRODUCTS; PERFORMANCE REVIEW.—
 3995         (a) The state board shall develop policy and procedures for
 3996  selecting, evaluating, and monitoring the performance of
 3997  approved providers and investment products to which employees
 3998  may direct retirement contributions under the investment plan
 3999  program. In accordance with such policy and procedures, the
 4000  state board shall designate and contract for a number of
 4001  investment products as determined by the board. The board shall
 4002  also select one or more bundled providers, each of which whom
 4003  may offer multiple investment options and related services, if
 4004  when such an approach is determined by the board to provide
 4005  afford value to the members participants otherwise not available
 4006  through individual investment products. Each approved bundled
 4007  provider may offer investment options that provide members
 4008  participants with the opportunity to invest in each of the
 4009  following asset classes, to be composed of individual options
 4010  that represent either a single asset class or a combination
 4011  thereof: money markets, United States fixed income, United
 4012  States equities, and foreign stock. The state board shall review
 4013  and manage all educational materials, contract terms, fee
 4014  schedules, and other aspects of the approved provider
 4015  relationships to ensure that no provider is unduly favored or
 4016  penalized by virtue of its status within the investment plan.
 4017         (b) The state board shall consider investment options or
 4018  products it considers appropriate to give members participants
 4019  the opportunity to accumulate retirement benefits, subject to
 4020  the following:
 4021         1. The investment plan Public Employee Optional Retirement
 4022  Program must offer a diversified mix of low-cost investment
 4023  products that span the risk-return spectrum and may include a
 4024  guaranteed account as well as investment products, such as
 4025  individually allocated guaranteed and variable annuities, which
 4026  meet the requirements of this subsection and combine the ability
 4027  to accumulate investment returns with the option of receiving
 4028  lifetime income consistent with the long-term retirement
 4029  security of a pension plan and similar to the lifetime-income
 4030  benefit provided by the Florida Retirement System.
 4031         2. Investment options or products offered by the group of
 4032  approved providers may include mutual funds, group annuity
 4033  contracts, individual retirement annuities, interests in trusts,
 4034  collective trusts, separate accounts, and other such financial
 4035  instruments, and may include products that give members
 4036  participants the option of committing their contributions for an
 4037  extended time period in an effort to obtain returns higher than
 4038  those that could be obtained from investment products offering
 4039  full liquidity.
 4040         3. The state board may shall not contract with a any
 4041  provider that imposes a front-end, back-end, contingent, or
 4042  deferred sales charge, or any other fee that limits or restricts
 4043  the ability of members participants to select any investment
 4044  product available in the investment plan optional program. This
 4045  prohibition does not apply to fees or charges that are imposed
 4046  on withdrawals from products that give members participants the
 4047  option of committing their contributions for an extended time
 4048  period in an effort to obtain returns higher than those that
 4049  could be obtained from investment products offering full
 4050  liquidity, if provided that the product in question, net of all
 4051  fees and charges, produces material benefits relative to other
 4052  comparable products in the investment plan program offering full
 4053  liquidity.
 4054         4. Fees or charges for insurance features, such as
 4055  mortality and expense-risk charges, must be reasonable relative
 4056  to the benefits provided.
 4057         (c) In evaluating and selecting approved providers and
 4058  products, the state board shall establish criteria for
 4059  evaluating under which it shall consider the relative
 4060  capabilities and qualifications of each proposed provider
 4061  company and product. In developing such criteria, the board
 4062  shall consider the following to the extent such factors may be
 4063  applied in connection with investment products, services, or
 4064  providers:
 4065         1. Experience in the United States providing retirement
 4066  products and related financial services under defined
 4067  contribution retirement programs plans.
 4068         2. Financial strength and stability as which shall be
 4069  evidenced by the highest ratings assigned by nationally
 4070  recognized rating services when comparing proposed providers
 4071  that are so rated.
 4072         3. Intrastate and interstate portability of the product
 4073  offered, including early withdrawal options.
 4074         4. Compliance with the Internal Revenue Code.
 4075         5. The cost-effectiveness of the product provided and the
 4076  levels of service supporting the product relative to its
 4077  benefits and its characteristics, including, without limitation,
 4078  the level of risk borne by the provider.
 4079         6. The provider company’s ability and willingness to
 4080  coordinate its activities with Florida Retirement System
 4081  employers, the department, and the state board, and to supply
 4082  the to such employers, the department, and the board with the
 4083  information and data they require.
 4084         7. The methods available to members participants to
 4085  interact with the provider company; the means by which members
 4086  participants may access account information, direct investment
 4087  of contributions, make changes to their accounts, transfer
 4088  moneys between available investment vehicles, and transfer
 4089  moneys between provider companies; and any fees that apply to
 4090  such activities.
 4091         8. The provider company’s policies with respect to the
 4092  transfer of individual account balances, contributions, and
 4093  earnings thereon, both internally among investment products
 4094  offered by the provider company and externally between approved
 4095  providers, as well as any fees, charges, reductions, or
 4096  penalties that may be applied.
 4097         9. An evaluation of specific investment products, taking
 4098  into account each product’s experience in meeting its investment
 4099  return objectives net of all related fees, expenses, and
 4100  charges, including, but not limited to, investment management
 4101  fees, loads, distribution and marketing fees, custody fees,
 4102  recordkeeping fees, education fees, annuity expenses, and
 4103  consulting fees.
 4104         10. Organizational factors, including, but not limited to,
 4105  financial solvency, organizational depth, and experience in
 4106  providing institutional and retail investment services.
 4107         (d) By March 1, 2010, the state board shall identify and
 4108  offer at least one terror-free investment product that allocates
 4109  its funds among securities not subject to divestiture as
 4110  provided in s. 215.473 if the investment product is deemed by
 4111  the state board to be consistent with prudent investor
 4112  standards. A No person may not bring a civil, criminal, or
 4113  administrative action against an approved provider; the state
 4114  board; or any employee, officer, director, or trustee of such
 4115  provider based upon the divestiture of any security or the
 4116  offering of a terror-free investment product as specified in
 4117  this paragraph.
 4118         (e) As a condition of offering an any investment option or
 4119  product in the investment plan optional retirement program, the
 4120  approved provider must agree to make the investment product or
 4121  service available under the most beneficial terms offered to any
 4122  other customer, subject to approval by the Trustees of the state
 4123  board of Administration.
 4124         (f) The state board shall regularly review the performance
 4125  of each approved provider and product and related organizational
 4126  factors to ensure continued compliance with established
 4127  selection criteria and with board policy and procedures.
 4128  Providers and products may be terminated subject to contract
 4129  provisions. The state board shall adopt procedures to transfer
 4130  account balances from terminated products or providers to other
 4131  products or providers in the investment plan optional program.
 4132         (g)1. An approved provider shall comply with all applicable
 4133  federal and state securities and insurance laws and regulations
 4134  applicable to the provider, as well as with the applicable rules
 4135  and guidelines of the National Association of Securities Dealers
 4136  which govern the ethical marketing of investment products. In
 4137  furtherance of this mandate, an approved provider must agree in
 4138  its contract with the state board to establish and maintain a
 4139  compliance education and monitoring system to supervise the
 4140  activities of all personnel who directly communicate with
 4141  individual members participants and recommend investment
 4142  products, which system is consistent with rules of the National
 4143  Association of Securities Dealers.
 4144         2. Approved provider personnel who directly communicate
 4145  with individual members participants and who recommend
 4146  investment products shall make an independent and unbiased
 4147  determination as to whether an investment product is suitable
 4148  for a particular member participant.
 4149         3. The state board shall develop procedures to receive and
 4150  resolve member participant complaints against a provider or
 4151  approved provider personnel, and, if when appropriate, refer
 4152  such complaints to the appropriate agency.
 4153         4. Approved providers may not sell or in any way distribute
 4154  any customer list or member participant identification
 4155  information generated through their offering of products or
 4156  services through the investment plan optional retirement
 4157  program.
 4158         (10) EDUCATION COMPONENT.—
 4159         (a) The state board, in coordination with the department,
 4160  shall provide for an education component for system members in a
 4161  manner consistent with the provisions of this section. The
 4162  education component must be available to eligible employees at
 4163  least 90 days prior to the beginning date of the election period
 4164  for the employees of the respective types of employers.
 4165         (b) The education component must provide system members
 4166  with impartial and balanced information about plan choices. The
 4167  education component must involve multimedia formats. Program
 4168  comparisons must, to the greatest extent possible, be based upon
 4169  the retirement income that different retirement programs may
 4170  provide to the member participant. The state board shall monitor
 4171  the performance of the contract to ensure that the program is
 4172  conducted in accordance with the contract, applicable law, and
 4173  the rules of the state board.
 4174         (c) The state board, in coordination with the department,
 4175  shall provide for an initial and ongoing transfer education
 4176  component to provide system members with information necessary
 4177  to make informed plan choice decisions. The transfer education
 4178  component must include, but is not limited to, information on:
 4179         1. The amount of money available to a member to transfer to
 4180  the defined contribution program.
 4181         2. The features of and differences between the pension plan
 4182  defined benefit program and the defined contribution program,
 4183  both generally and specifically, as those differences may affect
 4184  the member.
 4185         3. The expected benefit available if the member were to
 4186  retire under each of the retirement programs, based on
 4187  appropriate alternative sets of assumptions.
 4188         4. The rate of return from investments in the defined
 4189  contribution program and the period of time over which such rate
 4190  of return must be achieved to equal or exceed the expected
 4191  monthly benefit payable to the member under the pension plan
 4192  defined benefit program.
 4193         5. The historical rates of return for the investment
 4194  alternatives available in the defined contribution programs.
 4195         6. The benefits and historical rates of return on
 4196  investments available in a typical deferred compensation plan or
 4197  a typical plan under s. 403(b) of the Internal Revenue Code for
 4198  which the employee may be eligible.
 4199         7. The program choices available to employees of the State
 4200  University System and the comparative benefits of each available
 4201  program, if applicable.
 4202         8. Payout options available in each of the retirement
 4203  programs.
 4204         (d) An ongoing education and communication component must
 4205  provide eligible employees system members with information
 4206  necessary to make informed decisions about choices within their
 4207  retirement system program of membership and in preparation for
 4208  retirement. The component must include, but is not limited to,
 4209  information concerning:
 4210         1. Rights and conditions of membership.
 4211         2. Benefit features within the program, options, and
 4212  effects of certain decisions.
 4213         3. Coordination of contributions and benefits with a
 4214  deferred compensation plan under s. 457 or a plan under s.
 4215  403(b) of the Internal Revenue Code.
 4216         4. Significant program changes.
 4217         5. Contribution rates and program funding status.
 4218         6. Planning for retirement.
 4219         (e) Descriptive materials must be prepared under the
 4220  assumption that the employee is an unsophisticated investor, and
 4221  all materials used in the education component must be approved
 4222  by the state board prior to dissemination.
 4223         (f) The state board and the department shall also establish
 4224  a communication component to provide program information to
 4225  participating employers and the employers’ personnel and payroll
 4226  officers and to explain their respective responsibilities in
 4227  conjunction with the retirement programs.
 4228         (g) Funding for education of new employees may reflect
 4229  administrative costs to the investment plan optional program and
 4230  the pension plan defined benefit program.
 4231         (h) Pursuant to subsection paragraph (8)(a), all Florida
 4232  Retirement System employers have an obligation to regularly
 4233  communicate the existence of the two Florida Retirement System
 4234  plans and the plan choice in the natural course of administering
 4235  their personnel functions, using the educational materials
 4236  supplied by the state board and the Department of Management
 4237  Services.
 4238         (11) MEMBER PARTICIPANT INFORMATION REQUIREMENTS.—The state
 4239  board shall ensure that each member participant is provided a
 4240  quarterly statement that accounts for the contributions made on
 4241  behalf of the member such participant; the interest and
 4242  investment earnings thereon; and any fees, penalties, or other
 4243  deductions that apply thereto. At a minimum, such statements
 4244  must:
 4245         (a) Indicate the member’s participant’s investment options.
 4246         (b) State the market value of the account at the close of
 4247  the current quarter and previous quarter.
 4248         (c) Show account gains and losses for the period and
 4249  changes in account accumulation unit values for the quarter
 4250  period.
 4251         (d) Itemize account contributions for the quarter.
 4252         (e) Indicate any account changes due to adjustment of
 4253  contribution levels, reallocation of contributions, balance
 4254  transfers, or withdrawals.
 4255         (f) Set forth any fees, charges, penalties, and deductions
 4256  that apply to the account.
 4257         (g) Indicate the amount of the account in which the member
 4258  participant is fully vested and the amount of the account in
 4259  which the member participant is not vested.
 4260         (h) Indicate each investment product’s performance relative
 4261  to an appropriate market benchmark.
 4262  
 4263  The third-party administrator shall provide quarterly and annual
 4264  summary reports to the state board and any other reports
 4265  requested by the department or the state board. In any
 4266  solicitation or offer of coverage under the investment plan an
 4267  optional retirement program, a provider company shall be
 4268  governed by the contract readability provisions of s. 627.4145,
 4269  notwithstanding s. 627.4145(6)(c). In addition, all descriptive
 4270  materials must be prepared under the assumption that the member
 4271  participant is an unsophisticated investor. Provider companies
 4272  must maintain an internal system of quality assurance, have
 4273  proven functional systems that are date-calculation compliant,
 4274  and be subject to a due-diligence inquiry that proves their
 4275  capacity and fitness to undertake service responsibilities.
 4276         (12) ADVISORY COUNCIL TO PROVIDE ADVICE AND ASSISTANCE.—The
 4277  Investment Advisory Council, created pursuant to s. 215.444,
 4278  shall assist the state board in implementing and administering
 4279  the investment plan Public Employee Optional Retirement Program.
 4280  The Investment Advisory council, created pursuant to s. 215.444,
 4281  shall review the state board’s initial recommendations regarding
 4282  the criteria to be used in selecting and evaluating approved
 4283  providers and investment products. The council may provide
 4284  comments on the recommendations to the state board within 45
 4285  days after receiving the initial recommendations. The state
 4286  board shall make the final determination as to whether any
 4287  investment provider or product, any contractor, or any and all
 4288  contract provisions are shall be approved for the investment
 4289  plan program.
 4290         (13) FEDERAL REQUIREMENTS.—
 4291         (a) Provisions of This section shall be construed, and the
 4292  investment plan Public Employee Optional Retirement Program
 4293  shall be administered, so as to comply with the Internal Revenue
 4294  Code, 26 U.S.C., and specifically with plan qualification
 4295  requirements imposed on governmental plans under s. 401(a) of
 4296  the Internal Revenue Code. The state board may shall have the
 4297  power and authority to adopt rules reasonably necessary to
 4298  establish or maintain the qualified status of the investment
 4299  plan Optional Retirement Program under the Internal Revenue Code
 4300  and to implement and administer the investment plan Optional
 4301  Retirement Program in compliance with the Internal Revenue Code
 4302  and as designated under this part; provided however, that the
 4303  board shall not have the authority to adopt any rule which makes
 4304  a substantive change to the investment plan Optional Retirement
 4305  Program as designed by this part.
 4306         (b) Any section or provision of this chapter which is
 4307  susceptible to more than one construction shall must be
 4308  interpreted in favor of the construction most likely to satisfy
 4309  requirements imposed by s. 401(a) of the Internal Revenue Code.
 4310         (c) Contributions payable under this section for any
 4311  limitation year may not exceed the maximum amount allowable for
 4312  qualified defined contribution pension plans under applicable
 4313  provisions of the Internal Revenue Code. If an employee who is
 4314  enrolled has elected to participate in the investment plan
 4315  Public Employee Optional Retirement Program participates in any
 4316  other plan that is maintained by the participating employer,
 4317  benefits that accrue under the investment plan Public Employee
 4318  Optional Retirement Program shall be considered primary for any
 4319  aggregate limitation applicable under s. 415 of the Internal
 4320  Revenue Code.
 4321         (14) INVESTMENT POLICY STATEMENT.—
 4322         (a) Investment products and approved providers selected for
 4323  the investment plan must Public Employee Optional Retirement
 4324  Program shall conform with the Florida Retirement System
 4325  Investment Plan Public Employee Optional Retirement Program
 4326  Investment Policy Statement, herein referred to as the
 4327  “statement,” as developed and approved by the trustees of the
 4328  state board of Administration. The statement must include, among
 4329  other items, the investment objectives of the investment plan
 4330  Public Employee Optional Retirement Program, manager selection
 4331  and monitoring guidelines, and performance measurement criteria.
 4332  As required from time to time, the executive director of the
 4333  state board may present recommended changes in the statement to
 4334  the board for approval.
 4335         (b) Prior to presenting the statement, or any recommended
 4336  changes thereto, to the state board, the executive director of
 4337  the board shall present such statement or changes to the
 4338  Investment Advisory Council for review. The council shall
 4339  present the results of its review to the board prior to the
 4340  board’s final approval of the statement or changes in the
 4341  statement.
 4342         (15) STATEMENT OF FIDUCIARY STANDARDS AND
 4343  RESPONSIBILITIES.—
 4344         (a) Investment of optional defined contribution retirement
 4345  plan assets shall be made for the sole interest and exclusive
 4346  purpose of providing benefits to members plan participants and
 4347  beneficiaries and defraying reasonable expenses of administering
 4348  the plan. The program’s assets shall are to be invested, on
 4349  behalf of the program members participants, with the care,
 4350  skill, and diligence that a prudent person acting in a like
 4351  manner would undertake. The performance of the investment duties
 4352  set forth in this paragraph shall comply with the fiduciary
 4353  standards set forth in the Employee Retirement Income Security
 4354  Act of 1974 at 29 U.S.C. s. 1104(a)(1)(A)-(C). In case of
 4355  conflict with other provisions of law authorizing investments,
 4356  the investment and fiduciary standards set forth in this
 4357  subsection shall prevail.
 4358         (b) If a member participant or beneficiary of the
 4359  investment plan Public Employee Optional Retirement Program
 4360  exercises control over the assets in his or her account, as
 4361  determined by reference to regulations of the United States
 4362  Department of Labor under s. 404(c) of the Employee Retirement
 4363  Income Security Act of 1974 and all applicable laws governing
 4364  the operation of the program, a no program fiduciary is not
 4365  shall be liable for any loss to a member’s participant’s or
 4366  beneficiary’s account which results from the member’s such
 4367  participant’s or beneficiary’s exercise of control.
 4368         (c) Subparagraph (8)(b)2.4. and paragraph (15)(b)
 4369  incorporate the federal law concept of participant control,
 4370  established by regulations of the United States Department of
 4371  Labor under s. 404(c) of the Employee Retirement Income Security
 4372  Act of 1974 (ERISA). The purpose of this paragraph is to assist
 4373  employers and the state board of Administration in maintaining
 4374  compliance with s. 404(c), while avoiding unnecessary costs and
 4375  eroding member participant benefits under the investment plan
 4376  Public Employee Optional Retirement Program. Pursuant to 29
 4377  C.F.R. s. 2550.404c-1(b)(2)(i)(B)(1)(viii), the state board of
 4378  Administration or its designated agents shall deliver to members
 4379  participants of the investment plan Public Employee Optional
 4380  Retirement Program a copy of the prospectus most recently
 4381  provided to the plan, and, pursuant to 29 C.F.R. s. 2550.404c
 4382  1(b)(2)(i)(B)(2)(ii), shall provide such members participants an
 4383  opportunity to obtain this information, except that:
 4384         1. The requirement to deliver a prospectus shall be deemed
 4385  to be satisfied by delivery of a fund profile or summary profile
 4386  that contains the information that would be included in a
 4387  summary prospectus as described by Rule 498 under the Securities
 4388  Act of 1933, 17 C.F.R. s. 230.498. If When the transaction fees,
 4389  expense information or other information provided by a mutual
 4390  fund in the prospectus does not reflect terms negotiated by the
 4391  state board of Administration or its designated agents, the
 4392  aforementioned requirement is deemed to be satisfied by delivery
 4393  of a separate document described by Rule 498 substituting
 4394  accurate information; and
 4395         2. Delivery shall be deemed to have been effected if
 4396  delivery is through electronic means and the following standards
 4397  are satisfied:
 4398         a. Electronically-delivered documents are prepared and
 4399  provided consistent with style, format, and content requirements
 4400  applicable to printed documents;
 4401         b. Each member participant is provided timely and adequate
 4402  notice of the documents that are to be delivered, and their
 4403  significance thereof, and of the member’s participant’s right to
 4404  obtain a paper copy of such documents free of charge;
 4405         c.(I)Members Participants have adequate access to the
 4406  electronic documents, at locations such as their worksites or
 4407  public facilities, and have the ability to convert the documents
 4408  to paper free of charge by the state board of Administration,
 4409  and the board or its designated agents take appropriate and
 4410  reasonable measures to ensure that the system for furnishing
 4411  electronic documents results in actual receipt., or
 4412         (II)Members Participants have provided consent to receive
 4413  information in electronic format, which consent may be revoked;
 4414  and
 4415         d. The state board of Administration, or its designated
 4416  agent, actually provides paper copies of the documents free of
 4417  charge, upon request.
 4418         (16) DISABILITY BENEFITS.—For any member participant of the
 4419  investment plan optional retirement program who becomes totally
 4420  and permanently disabled, benefits must shall be paid in
 4421  accordance with the provisions of s. 121.591.
 4422         (17) SOCIAL SECURITY COVERAGE.—Social security coverage
 4423  shall be provided for all officers and employees who become
 4424  members participants of the investment plan optional program.
 4425  Any modification of the present agreement with the Social
 4426  Security Administration, or referendum required under the Social
 4427  Security Act, for the purpose of providing social security
 4428  coverage for any member shall be requested by the state agency
 4429  in compliance with the applicable provisions of the Social
 4430  Security Act governing such coverage. However, retroactive
 4431  social security coverage for service prior to December 1, 1970,
 4432  with the employer may shall not be provided for any member who
 4433  was not covered under the agreement as of November 30, 1970.
 4434         (18) RETIREE HEALTH INSURANCE SUBSIDY.—All officers and
 4435  employees who are members participants of the investment plan
 4436  are optional program shall be eligible to receive the retiree
 4437  health insurance subsidy, subject to the provisions of s.
 4438  112.363.
 4439         (19) MEMBER PARTICIPANT RECORDS.—Personal identifying
 4440  information of a member participant in the investment plan
 4441  Public Employee Optional Retirement Program contained in Florida
 4442  Retirement System records held by the state board of
 4443  Administration or the department of Management Services is
 4444  exempt from s. 119.07(1) and s. 24(a), Art. I of the State
 4445  Constitution.
 4446         (20) DESIGNATION OF BENEFICIARIES.—
 4447         (a) Each member participant may, by electronic means or on
 4448  a form provided for that purpose, signed and filed with the
 4449  third-party administrator, designate a choice of one or more
 4450  persons, named sequentially or jointly, as his or her
 4451  beneficiary for receiving who shall receive the benefits, if
 4452  any, which may be payable pursuant to this chapter in the event
 4453  of the member’s participant’s death. If no beneficiary is named
 4454  in this manner, or if no beneficiary designated by the member
 4455  participant survives the member participant, the beneficiary
 4456  shall be the spouse of the deceased, if living. If the member’s
 4457  participant’s spouse is not alive at the time of the member’s
 4458  his or her death, the beneficiary shall be the living children
 4459  of the member participant. If no children survive, the
 4460  beneficiary shall be the member’s participant’s father or
 4461  mother, if living; otherwise, the beneficiary shall be the
 4462  member’s participant’s estate. The beneficiary most recently
 4463  designated by a member participant on a form or letter filed
 4464  with the third-party administrator shall be the beneficiary
 4465  entitled to any benefits payable at the time of the member’s
 4466  participant’s death. However Notwithstanding any other provision
 4467  in this subsection to the contrary, for a member participant who
 4468  dies prior to his or her effective date of retirement, the
 4469  spouse at the time of death shall be the member’s participant’s
 4470  beneficiary unless the member such participant designates a
 4471  different beneficiary as provided in this subsection subsequent
 4472  to the member’s participant’s most recent marriage.
 4473         (b) If a member participant designates a primary
 4474  beneficiary other than the member’s participant’s spouse, the
 4475  member’s participant’s spouse must sign the beneficiary
 4476  designation form to acknowledge the designation. This
 4477  requirement does not apply to the designation of one or more
 4478  contingent beneficiaries to receive benefits remaining upon the
 4479  death of the primary beneficiary or beneficiaries.
 4480         (c) Notwithstanding the member’s participant’s designation
 4481  of benefits to be paid through a trust to a beneficiary that is
 4482  a natural person, and notwithstanding the provisions of the
 4483  trust, benefits must shall be paid directly to the beneficiary
 4484  if the person is no longer a minor or an incapacitated person as
 4485  defined in s. 744.102.
 4486         (21) PARTICIPATION BY TERMINATED DEFERRED RETIREMENT OPTION
 4487  PROGRAM MEMBERS PARTICIPANTS.—Notwithstanding any other
 4488  provision of law to the contrary, members participants in the
 4489  Deferred Retirement Option Program offered under part I may,
 4490  after conclusion of their participation in the program, elect to
 4491  roll over or authorize a direct trustee-to-trustee transfer to
 4492  an account under the investment plan Public Employee Optional
 4493  Retirement Program of their Deferred Retirement Option Program
 4494  proceeds distributed as provided under s. 121.091(13)(c)5. The
 4495  transaction must constitute an “eligible rollover distribution”
 4496  within the meaning of s. 402(c)(4) of the Internal Revenue Code.
 4497         (a) The investment plan Public Employee Optional Retirement
 4498  Program may accept such amounts for deposit into member
 4499  participant accounts as provided in paragraph (5)(e)(c).
 4500         (b) The affected member participant shall direct the
 4501  investment of his or her investment account; however, unless he
 4502  or she becomes a renewed member of the Florida Retirement System
 4503  under s. 121.122 and elects to participate in the investment
 4504  plan Public Employee Optional Retirement Program, no employer
 4505  contributions may not be made to the member’s participant’s
 4506  account as provided under paragraph (5)(a).
 4507         (c) The state board or the department is not responsible
 4508  for locating those persons who may be eligible to participate in
 4509  the investment plan Public Employee Optional Retirement Program
 4510  under this subsection.
 4511         (22) CREDIT FOR MILITARY SERVICE.—Creditable service of any
 4512  member of the investment plan includes Public Employee Optional
 4513  Retirement Program shall include military service in the Armed
 4514  Forces of the United States as provided in the conditions
 4515  outlined in s. 121.111(1).
 4516         Section 27. Section 121.4502, Florida Statutes, is amended
 4517  to read:
 4518         121.4502 Florida Retirement System Investment Plan Public
 4519  Employee Optional Retirement Program Trust Fund.—
 4520         (1) The Florida Retirement System Investment Plan Public
 4521  Employee Optional Retirement Program Trust Fund is created to
 4522  hold the assets of the Florida Retirement System Investment Plan
 4523  Public Employee Optional Retirement Program in trust for the
 4524  exclusive benefit of the plan’s members such program’s
 4525  participants and beneficiaries, and for the payment of
 4526  reasonable administrative expenses of the plan program, in
 4527  accordance with s. 401 of the Internal Revenue Code, and shall
 4528  be administered by the state board of Administration as trustee.
 4529  Funds shall be credited to the trust fund as provided in this
 4530  part, to be used for the purposes of this part. The trust fund
 4531  is exempt from the service charges imposed by s. 215.20.
 4532         (2) The Florida Retirement System Investment Plan Public
 4533  Employee Optional Retirement Program Trust Fund is a retirement
 4534  trust fund of the Florida Retirement System that accounts for
 4535  retirement plan assets held by the state in a trustee capacity
 4536  as a fiduciary for individual participants in the Florida
 4537  Retirement System Investment Plan Public Employee Optional
 4538  Retirement Program and, pursuant to s. 19(f), Art. III of the
 4539  State Constitution, is not subject to termination.
 4540         (3) A forfeiture account shall be created within the
 4541  Florida Retirement System Investment Plan Public Employee
 4542  Optional Retirement Program Trust Fund to hold the assets
 4543  derived from the forfeiture of benefits by participants.
 4544  Pursuant to a private letter ruling from the Internal Revenue
 4545  Service, the forfeiture account may be used only for paying
 4546  expenses of the Florida Retirement System Investment Plan Public
 4547  Employee Optional Retirement Program and reducing future
 4548  employer contributions to the program. Consistent with Rulings
 4549  80-155 and 74-340 of the Internal Revenue Service, unallocated
 4550  reserves within the forfeiture account must be used as quickly
 4551  and as prudently as possible considering the state board’s
 4552  fiduciary duty. Expected withdrawals from the account must
 4553  endeavor to reduce the account to zero each fiscal year.
 4554         Section 28. Subsections (1) and (3) of section 121.4503,
 4555  Florida Statutes, are amended to read:
 4556         121.4503 Florida Retirement System Contributions Clearing
 4557  Trust Fund.—
 4558         (1) The Florida Retirement System Contributions Clearing
 4559  Trust Fund is created as a clearing fund for disbursing employer
 4560  and employee contributions to the component plans of the Florida
 4561  Retirement System and shall be administered by the Department of
 4562  Management Services. Funds shall be credited to the trust fund
 4563  as provided in this chapter and shall be held in trust for the
 4564  contributing employees and employers until such time as the
 4565  assets are transferred by the department to the Florida
 4566  Retirement System Trust Fund, the Florida Retirement System
 4567  Investment Plan Public Employee Optional Retirement Program
 4568  Trust Fund, or other trust funds as authorized by law, to be
 4569  used for the purposes of this chapter. The trust fund is exempt
 4570  from the service charges imposed by s. 215.20.
 4571         (3) The Department of Management Services may adopt rules
 4572  governing the receipt and disbursement of amounts received by
 4573  the Florida Retirement System Contributions Clearing Trust Fund
 4574  from employers and employees contributing to the component plans
 4575  of the Florida Retirement System.
 4576         Section 29. Section 121.571, Florida Statutes, is amended
 4577  to read:
 4578         121.571 Contributions.—Contributions to the Florida
 4579  Retirement System Investment Plan Public Employee Optional
 4580  Retirement Program shall be made as follows:
 4581         (1) CONTRIBUTORY NONCONTRIBUTORY PLAN.—Each employer and
 4582  employee shall submit accomplish the contributions as required
 4583  by s. 121.71 by a procedure in which no employee’s gross salary
 4584  shall be reduced.
 4585         (2) CONTRIBUTION RATES GENERALLY.—Contributions to fund the
 4586  retirement and disability benefits provided under this part must
 4587  shall be based on the uniform contribution rates established by
 4588  s. 121.71 and on the membership class or subclass of the member
 4589  participant. Such contributions must shall be allocated as
 4590  provided in ss. 121.72 and 121.73.
 4591         (3) CONTRIBUTIONS FOR SOCIAL SECURITY COVERAGE AND FOR
 4592  RETIREE HEALTH INSURANCE SUBSIDY.—Contributions required under
 4593  s. 121.71 are this section shall be in addition to employer and
 4594  member contributions required for social security and the
 4595  Retiree Health Insurance Subsidy Trust Fund as required under
 4596  provided in ss. 112.363, 121.052, 121.055, and 121.071, as
 4597  appropriate.
 4598         Section 30. Section 121.591, Florida Statutes, is amended
 4599  to read:
 4600         121.591 Payment of benefits payable under the Public
 4601  Employee Optional Retirement Program of the Florida Retirement
 4602  System.—Benefits may not be paid under the Florida Retirement
 4603  System Investment Plan this section unless the member has
 4604  terminated employment as provided in s. 121.021(39)(a) or is
 4605  deceased and a proper application has been filed as in the
 4606  manner prescribed by the state board or the department. Before
 4607  termination of employment, benefits, including employee
 4608  contributions, are not payable under the investment plan for
 4609  employee hardships, unforeseeable emergencies, loans, medical
 4610  expenses, educational expenses, purchase of a principal
 4611  residence, payments necessary to prevent eviction or foreclosure
 4612  on an employee’s principal residence, or any other reason prior
 4613  to termination from all employment relationships with
 4614  participating employers. The state board or department, as
 4615  appropriate, may cancel an application for retirement benefits
 4616  if when the member or beneficiary fails to timely provide the
 4617  information and documents required by this chapter and the rules
 4618  of the state board and department. In accordance with their
 4619  respective responsibilities as provided herein, the state board
 4620  of Administration and the department of Management Services
 4621  shall adopt rules establishing procedures for application for
 4622  retirement benefits and for the cancellation of such application
 4623  if when the required information or documents are not received.
 4624  The state board of Administration and the department of
 4625  Management Services, as appropriate, are authorized to cash out
 4626  a de minimis account of a member participant who has been
 4627  terminated from Florida Retirement System covered employment for
 4628  a minimum of 6 calendar months. A de minimis account is an
 4629  account containing employer and employee contributions and
 4630  accumulated earnings of not more than $5,000 made under the
 4631  provisions of this chapter. Such cash-out must either be a
 4632  complete lump-sum liquidation of the account balance, subject to
 4633  the provisions of the Internal Revenue Code, or a lump-sum
 4634  direct rollover distribution paid directly to the custodian of
 4635  an eligible retirement plan, as defined by the Internal Revenue
 4636  Code, on behalf of the member participant. Any nonvested
 4637  accumulations and associated service credit, including amounts
 4638  transferred to the suspense account of the Florida Retirement
 4639  System Investment Plan Trust Fund authorized under s.
 4640  121.4501(6), shall be forfeited upon payment of any vested
 4641  benefit to a member or beneficiary, except for de minimis
 4642  distributions or minimum required distributions as provided
 4643  under this section. If any financial instrument issued for the
 4644  payment of retirement benefits under this section is not
 4645  presented for payment within 180 days after the last day of the
 4646  month in which it was originally issued, the third-party
 4647  administrator or other duly authorized agent of the state board
 4648  of Administration shall cancel the instrument and credit the
 4649  amount of the instrument to the suspense account of the Florida
 4650  Retirement System Investment Plan Public Employee Optional
 4651  Retirement Program Trust Fund authorized under s. 121.4501(6).
 4652  Any such amounts transferred to the suspense account are payable
 4653  upon a proper application, not to include earnings thereon, as
 4654  provided in this section, within 10 years after the last day of
 4655  the month in which the instrument was originally issued, after
 4656  which time such amounts and any earnings attributable to
 4657  employer contributions thereon shall be forfeited. Any such
 4658  forfeited amounts are assets of the Public Employee Optional
 4659  Retirement Program trust fund and are not subject to the
 4660  provisions of chapter 717.
 4661         (1) NORMAL BENEFITS.—Under the investment plan Public
 4662  Employee Optional Retirement Program:
 4663         (a) Benefits in the form of vested accumulations as
 4664  described in s. 121.4501(6) are payable under this subsection in
 4665  accordance with the following terms and conditions:
 4666         1. To the extent vested, Benefits are payable only to a
 4667  member, an alternate payee of a qualified domestic relations
 4668  order, or a beneficiary participant.
 4669         2. Benefits shall be paid by the third-party administrator
 4670  or designated approved providers in accordance with the law, the
 4671  contracts, and any applicable board rule or policy.
 4672         3. To receive benefits, The member participant must be
 4673  terminated from all employment with all Florida Retirement
 4674  System employers, as provided in s. 121.021(39).
 4675         4. Benefit payments may not be made until the member
 4676  participant has been terminated for 3 calendar months, except
 4677  that the state board may authorize by rule for the distribution
 4678  of up to 10 percent of the member’s participant’s account after
 4679  being terminated for 1 calendar month if the member participant
 4680  has reached the normal retirement date as defined in s. 121.021
 4681  of the defined benefit plan.
 4682         5. If a member or former member of the Florida Retirement
 4683  System receives an invalid distribution from the Public Employee
 4684  Optional Retirement Program Trust Fund, such person must either
 4685  repay the full amount invalid distribution to the trust fund
 4686  within 90 days after receipt of final notification by the state
 4687  board or the third-party administrator that the distribution was
 4688  invalid, or, in lieu of repayment, the member must terminate
 4689  employment from all participating employers. If such person
 4690  fails to repay the full invalid distribution within 90 days
 4691  after receipt of final notification, the person may be deemed
 4692  retired from the investment plan optional retirement program by
 4693  the state board, as provided pursuant to s. 121.4501(2)(k), and
 4694  is subject to s. 121.122. If such person is deemed retired by
 4695  the state board, any joint and several liability set out in s.
 4696  121.091(9)(d)2. is becomes null and void, and the state board,
 4697  the department, or the employing agency is not liable for gains
 4698  on payroll contributions that have not been deposited to the
 4699  person’s account in the investment plan retirement program,
 4700  pending resolution of the invalid distribution. The member or
 4701  former member who has been deemed retired or who has been
 4702  determined by the state board to have taken an invalid
 4703  distribution may appeal the agency decision through the
 4704  complaint process as provided under s. 121.4501(9)(g)3. As used
 4705  in this subparagraph, the term “invalid distribution” means any
 4706  distribution from an account in the investment plan optional
 4707  retirement program which is taken in violation of this section,
 4708  s. 121.091(9), or s. 121.4501.
 4709         (b) If a member participant elects to receive his or her
 4710  benefits upon termination of employment as defined in s.
 4711  121.021, the member participant must submit a written
 4712  application or an application by electronic means to the third
 4713  party administrator indicating his or her preferred distribution
 4714  date and selecting an authorized method of distribution as
 4715  provided in paragraph (c). The member participant may defer
 4716  receipt of benefits until he or she chooses to make such
 4717  application, subject to federal requirements.
 4718         (c) Upon receipt by the third-party administrator of a
 4719  properly executed application for distribution of benefits, the
 4720  total accumulated benefit is shall be payable to the member pro
 4721  rata across all Florida Retirement System benefit sources
 4722  participant, as:
 4723         1. A lump-sum or partial distribution to the member
 4724  participant;
 4725         2. A lump-sum direct rollover distribution whereby all
 4726  accrued benefits, plus interest and investment earnings, are
 4727  paid from the member’s participant’s account directly to the
 4728  custodian of an eligible retirement plan, as defined in s.
 4729  402(c)(8)(B) of the Internal Revenue Code, on behalf of the
 4730  member participant; or
 4731         3. Periodic distributions, as authorized by the state
 4732  board.
 4733         (d) The distribution payment method selected by the member
 4734  or beneficiary, and the retirement of the member or beneficiary,
 4735  is final and irrevocable at the time a benefit distribution
 4736  payment is cashed, deposited, or transferred to another
 4737  financial institution. Any additional service that remains
 4738  unclaimed at retirement may not be claimed or purchased, and the
 4739  type of retirement may not be changed, except that if a member
 4740  recovers from a disability, the member may subsequently request
 4741  benefits under subsection (2).
 4742         (e) A member may not receive a distribution of employee
 4743  contributions if a pending qualified domestic relations order is
 4744  filed against the member’s investment plan account.
 4745         (2) DISABILITY RETIREMENT BENEFITS.—Benefits provided under
 4746  this subsection are payable in lieu of the benefits that which
 4747  would otherwise be payable under the provisions of subsection
 4748  (1). Such benefits must shall be funded entirely from employer
 4749  contributions made under s. 121.571, transferred employee
 4750  contributions and participant funds accumulated pursuant to
 4751  paragraph (a), and interest and earnings thereon. Pursuant
 4752  thereto:
 4753         (a) Transfer of funds.—To qualify to receive monthly
 4754  disability benefits under this subsection:
 4755         1. All moneys accumulated in the member’s account
 4756  participant’s Public Employee Optional Retirement Program
 4757  accounts, including vested and nonvested accumulations as
 4758  described in s. 121.4501(6), must shall be transferred from such
 4759  individual accounts to the division of Retirement for deposit in
 4760  the disability account of the Florida Retirement System Trust
 4761  Fund. Such moneys must shall be separately accounted for
 4762  separately. Earnings must shall be credited on an annual basis
 4763  for amounts held in the disability accounts of the Florida
 4764  Retirement System Trust Fund based on actual earnings of the
 4765  Florida Retirement System trust fund.
 4766         2. If the member participant has retained retirement credit
 4767  he or she had earned under the pension plan defined benefit
 4768  program of the Florida Retirement System as provided in s.
 4769  121.4501(3)(b), a sum representing the actuarial present value
 4770  of such credit within the Florida Retirement System Trust Fund
 4771  shall be reassigned by the division of Retirement from the
 4772  pension plan defined benefit program to the disability program
 4773  as implemented under this subsection and shall be deposited in
 4774  the disability account of the Florida Retirement System trust
 4775  fund. Such moneys must shall be separately accounted for
 4776  separately.
 4777         (b) Disability retirement; entitlement.—
 4778         1. A member participant of the investment plan Public
 4779  Employee Optional Retirement Program who becomes totally and
 4780  permanently disabled, as defined in paragraph (d) s.
 4781  121.091(4)(b), after completing 8 years of creditable service,
 4782  or a member participant who becomes totally and permanently
 4783  disabled in the line of duty regardless of his or her length of
 4784  service, is shall be entitled to a monthly disability benefit as
 4785  provided herein.
 4786         2. In order for service to apply toward the 8 years of
 4787  creditable service required to vest for regular disability
 4788  benefits, or toward the creditable service used in calculating a
 4789  service-based benefit as provided for under paragraph (g), the
 4790  service must be creditable service as described below:
 4791         a. The member’s participant’s period of service under the
 4792  investment plan shall Public Employee Optional Retirement
 4793  Program will be considered creditable service, except as
 4794  provided in subparagraph d.
 4795         b. If the member participant has elected to retain credit
 4796  for his or her service under the pension plan defined benefit
 4797  program of the Florida Retirement System as provided under s.
 4798  121.4501(3)(b), all such service shall will be considered
 4799  creditable service.
 4800         c. If the member elects participant has elected to transfer
 4801  to his or her member participant accounts a sum representing the
 4802  present value of his or her retirement credit under the pension
 4803  plan defined benefit program as provided under s.
 4804  121.4501(3)(c), the period of service under the pension plan
 4805  defined benefit program represented in the present value amounts
 4806  transferred shall will be considered creditable service for
 4807  purposes of vesting for disability benefits, except as provided
 4808  in subparagraph d.
 4809         d. If a member Whenever a participant has terminated
 4810  employment and has taken distribution of his or her funds as
 4811  provided in subsection (1), all creditable service represented
 4812  by such distributed funds is forfeited for purposes of this
 4813  subsection.
 4814         (c) Disability retirement effective date.—The effective
 4815  retirement date for a member participant who applies and is
 4816  approved for disability retirement shall be established as
 4817  provided under s. 121.091(4)(a)2. and 3.
 4818         (d) Total and permanent disability.—A member participant
 4819  shall be considered totally and permanently disabled if, in the
 4820  opinion of the division, he or she is prevented, by reason of a
 4821  medically determinable physical or mental impairment, from
 4822  rendering useful and efficient service as an officer or
 4823  employee.
 4824         (e) Proof of disability.The division, Before approving
 4825  payment of any disability retirement benefit, the division shall
 4826  require proof that the member participant is totally and
 4827  permanently disabled in the same manner as provided for members
 4828  of the defined benefit program of the Florida Retirement System
 4829  under s. 121.091(4)(c).
 4830         (f) Disability retirement benefit.—Upon the disability
 4831  retirement of a member participant under this subsection, the
 4832  member participant shall receive a monthly benefit that begins
 4833  accruing shall begin to accrue on the first day of the month of
 4834  disability retirement, as approved by the division, and is shall
 4835  be payable on the last day of that month and each month
 4836  thereafter during his or her lifetime and continued disability.
 4837  All disability benefits must payable to such member shall be
 4838  paid out of the disability account of the Florida Retirement
 4839  System Trust Fund established under this subsection.
 4840         (g) Computation of disability retirement benefit.—The
 4841  amount of each monthly payment must shall be calculated in the
 4842  same manner as provided for members of the defined benefit
 4843  program of the Florida Retirement System under s. 121.091(4)(f).
 4844  For such purpose, Creditable service under both the pension plan
 4845  defined benefit program and the investment plan Public Employee
 4846  Optional Retirement Program of the Florida Retirement System
 4847  shall be applicable as provided under paragraph (b).
 4848         (h) Reapplication.—A member participant whose initial
 4849  application for disability retirement is has been denied may
 4850  reapply for disability benefits in the same manner, and under
 4851  the same conditions, as provided in for members of the defined
 4852  benefit program of the Florida Retirement System under s.
 4853  121.091(4)(g).
 4854         (i) Membership.—Upon approval of a member’s an application
 4855  for disability benefits under this subsection, the member
 4856  applicant shall be transferred to the pension plan defined
 4857  benefit program of the Florida Retirement System, effective upon
 4858  his or her disability retirement effective date.
 4859         (j) Option to cancel.A member Any participant whose
 4860  application for disability benefits is approved may cancel the
 4861  his or her application if for disability benefits, provided that
 4862  the cancellation request is received by the division before a
 4863  disability retirement warrant has been deposited, cashed, or
 4864  received by direct deposit. Upon such cancellation:
 4865         1. The member’s participant’s transfer to the pension plan
 4866  defined benefit program under paragraph (i) shall be nullified;
 4867         2. The member participant shall be retroactively reinstated
 4868  in the investment plan Public Employee Optional Retirement
 4869  Program without hiatus;
 4870         3. All funds transferred to the Florida Retirement System
 4871  Trust Fund under paragraph (a) must shall be returned to the
 4872  member participant accounts from which the such funds were
 4873  drawn; and
 4874         4. The member participant may elect to receive the benefit
 4875  payable under the provisions of subsection (1) in lieu of
 4876  disability benefits as provided under this subsection.
 4877         (k) Recovery from disability.—
 4878         1. The division may require periodic reexaminations at the
 4879  expense of the disability program account of the Florida
 4880  Retirement System Trust Fund. Except as otherwise provided in
 4881  subparagraph 2., the requirements, procedures, and restrictions
 4882  relating to the conduct and review of such reexaminations,
 4883  discontinuation or termination of benefits, reentry into
 4884  employment, disability retirement after reentry into covered
 4885  employment, and all other matters relating to recovery from
 4886  disability shall be the same as provided are set forth under s.
 4887  121.091(4)(h).
 4888         2. Upon recovery from disability, the any recipient of
 4889  disability retirement benefits under this subsection shall be a
 4890  compulsory member of the investment plan Public Employee
 4891  Optional Retirement Program of the Florida Retirement System.
 4892  The net difference between the recipient’s original account
 4893  balance transferred to the Florida Retirement System Trust Fund,
 4894  including earnings, under paragraph (a) and total disability
 4895  benefits paid to such recipient, if any, shall be determined as
 4896  provided in sub-subparagraph a.
 4897         a. An amount equal to the total benefits paid shall be
 4898  subtracted from that portion of the transferred account balance
 4899  consisting of vested accumulations as described under s.
 4900  121.4501(6), if any, and an amount equal to the remainder of
 4901  benefit amounts paid, if any, shall then be subtracted from any
 4902  remaining portion consisting of nonvested accumulations as
 4903  described under s. 121.4501(6).
 4904         b. Amounts subtracted under sub-subparagraph a. must shall
 4905  be retained within the disability account of the Florida
 4906  Retirement System Trust Fund. Any remaining account balance
 4907  shall be transferred to the third-party administrator for
 4908  disposition as provided under sub-subparagraph c. or sub
 4909  subparagraph d., as appropriate.
 4910         c. If the recipient returns to covered employment,
 4911  transferred amounts must shall be deposited in individual
 4912  accounts under the investment plan Public Employee Optional
 4913  Retirement Program, as directed by the member participant.
 4914  Vested and nonvested amounts shall be separately accounted for
 4915  separately as provided in s. 121.4501(6).
 4916         d. If the recipient fails to return to covered employment
 4917  upon recovery from disability:
 4918         (I) Any remaining vested amount must shall be deposited in
 4919  individual accounts under the investment plan Public Employee
 4920  Optional Retirement Program, as directed by the member
 4921  participant, and is shall be payable as provided in subsection
 4922  (1).
 4923         (II) Any remaining nonvested amount must shall be held in a
 4924  suspense account and is shall be forfeitable after 5 years as
 4925  provided in s. 121.4501(6).
 4926         3. If present value was reassigned from the pension plan
 4927  defined benefit program to the disability program of the Florida
 4928  Retirement System as provided under subparagraph (a)2., the full
 4929  present value amount must shall be returned to the defined
 4930  benefit account within the Florida Retirement System Trust Fund
 4931  and the member’s affected individual’s associated retirement
 4932  credit under the pension plan must defined benefit program shall
 4933  be reinstated in full. Any benefit based upon such credit must
 4934  shall be calculated as provided in s. 121.091(4)(h)1.
 4935         (l) Nonadmissible causes of disability.—A member is
 4936  participant shall not be entitled to receive a disability
 4937  retirement benefit if the disability results from any injury or
 4938  disease sustained or inflicted as described in s. 121.091(4)(i).
 4939         (m) Disability retirement of justice or judge by order of
 4940  Supreme Court.—
 4941         1. If a member participant is a justice of the Supreme
 4942  Court, judge of a district court of appeal, circuit judge, or
 4943  judge of a county court who has served for the years equal to,
 4944  or greater than, the vesting requirement in s. 121.021(45) 6
 4945  years or more as an elected constitutional judicial officer,
 4946  including service as a judicial officer in any court abolished
 4947  pursuant to Art. V of the State Constitution, and who is retired
 4948  for disability by order of the Supreme Court upon recommendation
 4949  of the Judicial Qualifications Commission pursuant to s. 12, the
 4950  provisions of Art. V of the State Constitution, the member’s
 4951  participant’s Option 1 monthly disability benefit amount as
 4952  provided in s. 121.091(6)(a)1. shall be two-thirds of his or her
 4953  monthly compensation as of the member’s participant’s disability
 4954  retirement date. The member Such a participant may alternatively
 4955  elect to receive an actuarially adjusted disability retirement
 4956  benefit under any other option as provided in s. 121.091(6)(a),
 4957  or to receive the normal benefit payable under the Public
 4958  Employee Optional Retirement Program as set forth in subsection
 4959  (1).
 4960         2. If any justice or judge who is a member participant of
 4961  the investment plan Public Employee Optional Retirement Program
 4962  of the Florida Retirement System is retired for disability by
 4963  order of the Supreme Court upon recommendation of the Judicial
 4964  Qualifications Commission pursuant to s. 12, the provisions of
 4965  Art. V of the State Constitution and elects to receive a monthly
 4966  disability benefit under the provisions of this paragraph:
 4967         a. Any present value amount that was transferred to his or
 4968  her investment plan program account and all employer and
 4969  employee contributions made to such account on his or her
 4970  behalf, plus interest and earnings thereon, must shall be
 4971  transferred to and deposited in the disability account of the
 4972  Florida Retirement System Trust Fund; and
 4973         b. The monthly disability benefits payable under this
 4974  paragraph for any affected justice or judge retired from the
 4975  Florida Retirement System pursuant to Art. V of the State
 4976  Constitution shall be paid from the disability account of the
 4977  Florida Retirement System Trust Fund.
 4978         (n) Death of retiree or beneficiary.—Upon the death of a
 4979  disabled retiree or beneficiary of the retiree thereof who is
 4980  receiving monthly disability benefits under this subsection, the
 4981  monthly benefits shall be paid through the last day of the month
 4982  of death and shall terminate, or be adjusted, if applicable, as
 4983  of that date in accordance with the optional form of benefit
 4984  selected at the time of retirement. The department of Management
 4985  Services may adopt rules necessary to administer this paragraph.
 4986         (3) DEATH BENEFITS.—Under the Florida Retirement System
 4987  Investment Plan Public Employee Optional Retirement Program:
 4988         (a) Survivor benefits are shall be payable in accordance
 4989  with the following terms and conditions:
 4990         1. To the extent vested, benefits are shall be payable only
 4991  to a member’s participant’s beneficiary or beneficiaries as
 4992  designated by the member participant as provided in s.
 4993  121.4501(20).
 4994         2. Benefits shall be paid by the third-party administrator
 4995  or designated approved providers in accordance with the law, the
 4996  contracts, and any applicable state board rule or policy.
 4997         3. To receive benefits under this subsection, the member
 4998  participant must be deceased.
 4999         (b) In the event of a member’s participant’s death, all
 5000  vested accumulations as described in s. 121.4501(6), less
 5001  withholding taxes remitted to the Internal Revenue Service,
 5002  shall be distributed, as provided in paragraph (c) or as
 5003  described in s. 121.4501(20), as if the member participant
 5004  retired on the date of death. No other death benefits are shall
 5005  be available for survivors of members participants under the
 5006  Public Employee Optional Retirement Program, except for such
 5007  benefits, or coverage for such benefits, as are otherwise
 5008  provided by law or are separately provided afforded by the
 5009  employer, at the employer’s discretion.
 5010         (c) Upon receipt by the third-party administrator of a
 5011  properly executed application for distribution of benefits, the
 5012  total accumulated benefit is shall be payable by the third-party
 5013  administrator to the member’s participant’s surviving
 5014  beneficiary or beneficiaries, as:
 5015         1. A lump-sum distribution payable to the beneficiary or
 5016  beneficiaries, or to the deceased member’s participant’s estate;
 5017         2. An eligible rollover distribution, if permitted, on
 5018  behalf of the surviving spouse of a deceased member participant,
 5019  whereby all accrued benefits, plus interest and investment
 5020  earnings, are paid from the deceased member’s participant’s
 5021  account directly to the custodian of an eligible retirement
 5022  plan, as described in s. 402(c)(8)(B) of the Internal Revenue
 5023  Code, on behalf of the surviving spouse; or
 5024         3. A partial lump-sum payment whereby a portion of the
 5025  accrued benefit is paid to the deceased member’s participant’s
 5026  surviving spouse or other designated beneficiaries, less
 5027  withholding taxes remitted to the Internal Revenue Service, and
 5028  the remaining amount is transferred directly to the custodian of
 5029  an eligible retirement plan, if permitted, as described in s.
 5030  402(c)(8)(B) of the Internal Revenue Code, on behalf of the
 5031  surviving spouse. The proportions must be specified by the
 5032  member participant or the surviving beneficiary.
 5033  
 5034  This paragraph does not abrogate other applicable provisions of
 5035  state or federal law providing for payment of death benefits.
 5036         (4) LIMITATION ON LEGAL PROCESS.—The benefits payable to
 5037  any person under the Florida Retirement System Investment Plan
 5038  Public Employee Optional Retirement Program, and any
 5039  contributions accumulated under the plan such program, are not
 5040  subject to assignment, execution, attachment, or any legal
 5041  process, except for qualified domestic relations orders by a
 5042  court of competent jurisdiction, income deduction orders as
 5043  provided in s. 61.1301, and federal income tax levies.
 5044         Section 31. Section 121.5911, Florida Statutes, is amended
 5045  to read:
 5046         121.5911 Disability retirement program; qualified status;
 5047  rulemaking authority.—It is the intent of the Legislature that
 5048  the disability retirement program for members participants of
 5049  the Florida Retirement System Investment Plan Public Employee
 5050  Optional Retirement Program as created in this act must meet all
 5051  applicable requirements of federal law for a qualified plan. The
 5052  department of Management Services shall seek a private letter
 5053  ruling from the Internal Revenue Service on the disability
 5054  retirement program for participants of the Public Employee
 5055  Optional Retirement Program. Consistent with the private letter
 5056  ruling, the department of Management Services shall adopt any
 5057  necessary rules necessary required to maintain the qualified
 5058  status of the disability retirement program and the Florida
 5059  Retirement System Pension defined benefit Plan.
 5060         Section 32. Section 121.70, Florida Statutes, is amended to
 5061  read:
 5062         121.70 Legislative purpose and intent.—
 5063         (1) This part provides for a uniform system for funding
 5064  benefits provided under the Florida Retirement System Pension
 5065  Plan defined benefit program established under part I of this
 5066  chapter (referred to in this part as the pension plan defined
 5067  benefit program) and under the Florida Retirement System
 5068  Investment Plan Public Employee Optional Retirement Program
 5069  established under part II of this chapter (referred to in this
 5070  part as the investment plan optional retirement program). The
 5071  Legislature recognizes and declares that the Florida Retirement
 5072  System is a single retirement system, consisting of two
 5073  retirement plans and other nonintegrated programs. Employees and
 5074  employers participating in the Florida Retirement System
 5075  collectively shall be responsible for making contributions to
 5076  support the benefits provided afforded under both plans. The
 5077  employees and As provided in this part, employers participating
 5078  in the Florida Retirement System shall make contributions based
 5079  upon uniform contribution rates determined as a percentage of
 5080  the employee’s gross monthly compensation total payroll for the
 5081  employee’s each class or subclass of Florida Retirement System
 5082  membership, irrespective of the which retirement plan in which
 5083  the individual employee is enrolled employees may elect. This
 5084  shall be known as a uniform or blended contribution rate system.
 5085         (2) In establishing a uniform contribution rate system, it
 5086  is the intent of the Legislature to:
 5087         (a) Provide greater stability and certainty in financial
 5088  planning and budgeting for Florida Retirement System employers
 5089  by eliminating the fiscal instability that would be caused by
 5090  dual rates coupled with employee-selected plan participation;
 5091         (b) Provide greater fiscal equity and uniformity for system
 5092  employers by effectively distributing the financial burden and
 5093  benefit of short-term system deficits and surpluses,
 5094  respectively, in proportion to total system payroll; and
 5095         (c) Allow employees to make their retirement plan selection
 5096  decisions free of circumstances that may cause employers to
 5097  favor one plan choice over another.
 5098         Section 33. Section 121.71, Florida Statutes, is amended to
 5099  read:
 5100         121.71 Uniform rates; process; calculations; levy.—
 5101         (1) In conducting the system actuarial study required under
 5102  s. 121.031, the actuary shall follow all requirements specified
 5103  thereunder to determine, by Florida Retirement System employee
 5104  membership class, the dollar contribution amounts necessary for
 5105  the next forthcoming fiscal year for the pension plan defined
 5106  benefit program. In addition, the actuary shall determine, by
 5107  Florida Retirement System membership class, based on an estimate
 5108  for the next forthcoming fiscal year of the gross compensation
 5109  of employees participating in the investment plan optional
 5110  retirement program, the dollar contribution amounts necessary to
 5111  make the allocations required under ss. 121.72 and 121.73. For
 5112  each employee membership class and subclass, the actuarial study
 5113  must shall establish a uniform rate necessary to fund the
 5114  benefit obligations under both Florida Retirement System
 5115  retirement plans by dividing the sum of total dollars required
 5116  by the estimated gross compensation of members in both plans.
 5117         (2) Based on the uniform rates set forth in subsections
 5118  subsection (3), (4), and (5), employees and employers shall make
 5119  monthly contributions to the Division of Retirement as required
 5120  in s. 121.061(1), which shall initially deposit the funds into
 5121  the Florida Retirement System Contributions Clearing Trust Fund.
 5122  A change in a contribution rate is effective the first day of
 5123  the month for which a full month’s employer and employee
 5124  contribution may be made on or after the beginning date of the
 5125  change. Beginning July 1, 2011, each employee shall contribute
 5126  the contributions required in subsection (3). The employer shall
 5127  deduct the contribution from the employee’s monthly salary, and
 5128  the contribution shall be submitted to the division. These
 5129  contributions shall be reported as employer-paid employee
 5130  contributions, and credited to the account of the employee. The
 5131  contributions shall be deducted from the employee’s salary
 5132  before the computation of applicable federal taxes and treated
 5133  as employer contributions under 26 U.S.C. s. 414(h)(2). The
 5134  employer specifies that the contributions, although designated
 5135  as employee contributions, are being paid by the employer in
 5136  lieu of contributions by the employee. The employee does not
 5137  have the option of choosing to receive the contributed amounts
 5138  directly instead of having them paid by the employer to the
 5139  plan. Such contributions are mandatory and each employee is
 5140  considered to have consented to payroll deductions. Payment of
 5141  an employee’s salary or wages, less the contribution, is a full
 5142  and complete discharge and satisfaction of all claims and
 5143  demands for the service rendered by employees during the period
 5144  covered by the payment, except their claims to the benefits to
 5145  which they may be entitled under this chapter.
 5146         (3) Required employee retirement contribution rates for
 5147  each membership class and subclass of the Florida Retirement
 5148  System for both retirement plans are as follows:
 5149  Membership Class               Percentage of Gross Compensation,Effective July 1, 2011
 5150  Regular Class                               3.00%             
 5151  Special Risk Class                          3.00%             
 5152  Special Risk Administrative Support Class             3.00%             
 5153  Elected Officers’ Class—Legislators, Governor,Lt. Governor,Cabinet Officers,State Attorneys,Public Defenders             3.00%             
 5154  Elected Officers’ Class—Justices, Judges             3.00%             
 5155  Elected Officers’ Class—County Elected Officers             3.00%             
 5156  Senior Management Service Class             3.00%             
 5157  DROP                                        0.00%             
 5158         (4)(3) Required employer retirement contribution rates for
 5159  each membership class and subclass of the Florida Retirement
 5160  System for both retirement plans are as follows:
 5161  Membership Class               Percentage ofGrossCompensation,EffectiveJuly 1, 2011 2009Percentage ofGrossCompensation,EffectiveJuly 1, 2012 2010
 5162                                 
 5163  Regular Class                    3.28% 8.69%     3.28% 9.63%   
 5164  Special Risk Class              10.21% 19.76%   10.21% 22.11%  
 5165  Special Risk Administrative Support Class  4.07% 11.39%    4.07% 12.10%  
 5166  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders  7.02% 13.32%    7.02% 15.20%  
 5167  Elected Officers’ Class— Justices, Judges  9.78% 18.40%    9.78% 20.65%  
 5168  Elected Officers’ Class— County Elected Officers  9.27% 15.37%    9.27% 17.50%  
 5169  Senior Management Service Class  4.81% 11.96%    4.81% 13.43%  
 5170  DROP                             3.31% 9.80%     3.31% 11.14%  
 5171  
 5172         (5) In order to address unfunded actuarial liabilities of
 5173  the system, the required employer retirement contribution rates
 5174  for each membership class and subclass of the Florida Retirement
 5175  System for both retirement plans are as follows:
 5176                                                                 
 5177                                                                 
 5178  
 5179  
 5180  
 5181  
 5182  
 5183  
 5184  
 5185  
 5186  
 5187  
 5188  
 5189  
 5190  
 5191  
 5192  
 5193  
 5194  
 5195  
 5196  
 5197  
 5198  
 5199  
 5200  
 5201  
 5202  
 5203  
 5204  
 5205  
 5206  
 5207  
 5208  
 5209  
 5210  
 5211  
 5212  
 5213         (6) If a member is reported under an incorrect membership
 5214  class and the amount of contributions reported and remitted are
 5215  less than the amount required, the employer shall owe the
 5216  difference, plus the delinquent fee, of 1 percent for each
 5217  calendar month or part thereof that the contributions should
 5218  have been paid. The delinquent assessment may not be waived. If
 5219  the contributions reported and remitted are more than the amount
 5220  required, the employer shall receive a credit to be applied
 5221  against future contributions owed.
 5222         (7)(4) The state actuary shall recognize and use an
 5223  appropriate level of available excess assets of the Florida
 5224  Retirement System Trust Fund to offset the difference between
 5225  the normal costs of the Florida Retirement System and the
 5226  statutorily prescribed contribution rates.
 5227         Section 34. Section 121.72, Florida Statutes, is amended to
 5228  read:
 5229         121.72 Allocations to investment plan member optional
 5230  retirement program participant accounts; percentage amounts.—
 5231         (1) The allocations established in subsection (4) shall
 5232  fund retirement benefits under the investment plan optional
 5233  retirement program and shall be transferred monthly by the
 5234  Division of Retirement from the Florida Retirement System
 5235  Contributions Clearing Trust Fund to the third-party
 5236  administrator for deposit in each participating employee’s
 5237  individual account based on the membership class of the
 5238  participant.
 5239         (2) The allocations are stated as a percentage of each
 5240  investment plan member’s optional retirement program
 5241  participant’s gross compensation for the calendar month. A
 5242  change in a contribution percentage is effective the first day
 5243  of the month for which retirement contributions a full month’s
 5244  employer contribution may be made on or after the beginning date
 5245  of the change. Contribution percentages may be modified by
 5246  general law.
 5247         (3) Employer and employee participant contributions to
 5248  member participant accounts shall be accounted for separately.
 5249  Participant contributions may be made only if expressly
 5250  authorized by law. Interest and investment earnings on
 5251  contributions shall accrue on a tax-deferred basis until
 5252  proceeds are distributed.
 5253         (4) Effective July 1, 2002, allocations from the Florida
 5254  Retirement System Contributions Clearing Trust Fund to
 5255  investment plan member optional retirement program participant
 5256  accounts are shall be as follows:
 5257  Membership Class                      Percentage of Gross Compensation
 5258                                        
 5259  Regular Class                                     9.00%             
 5260  Special Risk Class                                20.00%            
 5261  Special Risk Administrative Support Class            11.35%            
 5262  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders            13.40%            
 5263  Elected Officers’ Class— Justices, Judges            18.90%            
 5264  Elected Officers’ Class— County Elected Officers            16.20%            
 5265  Senior Management Service Class                   10.95%            
 5266  
 5267         Section 35. Section 121.73, Florida Statutes, is amended to
 5268  read:
 5269         121.73 Allocations for member optional retirement program
 5270  participant disability coverage; percentage amounts.—
 5271         (1) The allocations established in subsection (3) shall be
 5272  used to provide disability coverage for members participants in
 5273  the investment plan optional retirement program and shall be
 5274  transferred monthly by the Division of Retirement from the
 5275  Florida Retirement System Contributions Clearing Trust Fund to
 5276  the disability account of the Florida Retirement System Trust
 5277  Fund.
 5278         (2) The allocations are stated as a percentage of each
 5279  investment plan member’s optional retirement program
 5280  participant’s gross compensation for the calendar month. A
 5281  change in a contribution percentage is effective the first day
 5282  of the month for which retirement contributions a full month’s
 5283  employer contribution may be made on or after the beginning date
 5284  of the change. Contribution percentages may be modified by
 5285  general law.
 5286         (3) Effective July 1, 2002, allocations from the Florida
 5287  Retirement System Contributions FRS Contribution Clearing Trust
 5288  Fund to provide disability coverage for members participants in
 5289  the investment plan optional retirement program, and to offset
 5290  the costs of administering said coverage, are shall be as
 5291  follows:
 5292  Membership Class                      Percentage of Gross Compensation
 5293                                        
 5294  Regular Class                                     0.25%             
 5295  Special Risk Class                                1.33%             
 5296  Special Risk Administrative Support Class            0.45%             
 5297  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders            0.41%             
 5298  Elected Officers’ Class— Justices, Judges            0.73%             
 5299  Elected Officers’ Class— County Elected Officers            0.41%             
 5300  Senior Management Service Class                   0.26%             
 5301  
 5302         Section 36. Section 121.74, Florida Statutes, is amended to
 5303  read:
 5304         121.74 Administrative and educational expenses.—In addition
 5305  to contributions required under ss. s. 121.71 and 121.73,
 5306  effective July 1, 2010, through June 30, 2014, employers
 5307  participating in the Florida Retirement System shall contribute
 5308  an amount equal to 0.03 percent of the payroll reported for each
 5309  class or subclass of Florida Retirement System membership.;
 5310  Effective July 1, 2014, the contribution rate shall be 0.04
 5311  percent of the payroll reported for each class or subclass of
 5312  membership. The amount contributed shall be transferred by the
 5313  Division of Retirement from the Florida Retirement System
 5314  Contributions Clearing Trust Fund to the State Board of
 5315  Administration’s Administrative Trust Fund to offset the costs
 5316  of administering the investment plan optional retirement program
 5317  and the costs of providing educational services to members of
 5318  the Florida Retirement System participants in the defined
 5319  benefit program and the optional retirement program. Approval of
 5320  the trustees is required before the expenditure of these funds.
 5321  Payments for third-party administrative or educational expenses
 5322  shall be made only pursuant to the terms of the approved
 5323  contracts for such services.
 5324         Section 37. Section 121.75, Florida Statutes, is amended to
 5325  read:
 5326         121.75 Allocation for pension plan defined benefit
 5327  program.—After making the transfers required pursuant to ss.
 5328  121.71, 121.72, 121.73, and 121.74, the monthly balance of funds
 5329  in the Florida Retirement System Contributions Clearing Trust
 5330  Fund shall be transferred to the Florida Retirement System Trust
 5331  Fund to pay the costs of providing pension plan defined benefit
 5332  program benefits and plan administrative costs under the pension
 5333  plan defined benefit program.
 5334         Section 38. Section 121.77, Florida Statutes, is amended to
 5335  read:
 5336         121.77 Deductions from member participant accounts.—The
 5337  State Board of Administration may authorize the third-party
 5338  administrator to deduct reasonable fees and apply appropriate
 5339  charges to investment plan member optional retirement program
 5340  participant accounts. In no event may shall administrative and
 5341  educational expenses exceed the portion of employer
 5342  contributions earmarked for such expenses under this part,
 5343  except for reasonable administrative charges assessed against
 5344  member participant accounts of persons for whom no employer
 5345  contributions are made during the calendar quarter. Investment
 5346  management fees shall be deducted from member participant
 5347  accounts, pursuant to the terms of the contract between the
 5348  provider and the board.
 5349         Section 39. Section 121.78, Florida Statutes, is amended to
 5350  read:
 5351         121.78 Payment and distribution of contributions.—
 5352         (1) Contributions made pursuant to this part shall be paid
 5353  by the employer, including the employee contribution, to the
 5354  Division of Retirement by electronic funds transfer no later
 5355  than the 5th working day of the month immediately following the
 5356  month during which the payroll period ended. Accompanying
 5357  payroll data must be transmitted to the division concurrent with
 5358  the contributions.
 5359         (2) The division, the State Board of Administration, and
 5360  the third-party administrator, as applicable, shall ensure that
 5361  the contributions are distributed to the appropriate trust funds
 5362  or participant accounts in a timely manner.
 5363         (3)(a) Employee and employer contributions and accompanying
 5364  payroll data received after the 5th working day of the month are
 5365  considered late. The employer shall be assessed by the Division
 5366  of Retirement a penalty of 1 percent of the contributions due
 5367  for each calendar month or part thereof that the contributions
 5368  or accompanying payroll data are late. Proceeds from the 1
 5369  percent 1-percent assessment against contributions made on
 5370  behalf of members participants of the pension plan must defined
 5371  benefit program shall be deposited in the Florida Retirement
 5372  System Trust Fund, and proceeds from the 1-percent assessment
 5373  against contributions made on behalf of members participants of
 5374  the investment plan optional retirement program shall be
 5375  transferred to the third-party administrator for deposit into
 5376  member participant accounts, as provided in paragraph (c) (b).
 5377         (b) Retirement contributions paid for a prior period shall
 5378  be charged a delinquent fee of 1 percent for each calendar month
 5379  or part thereof that the contributions should have been paid.
 5380  This includes prior period contributions due to incorrect wages
 5381  and contributions from an earlier report or wages and
 5382  contributions that should have been reported but were not. The
 5383  delinquent assessments may not be waived.
 5384         (c)(b) If employee contributions or contributions made by
 5385  an employer on behalf of members participants of the investment
 5386  plan optional retirement program or accompanying payroll data
 5387  are not received within the calendar month they are due,
 5388  including, but not limited to, contribution adjustments as a
 5389  result of employer errors or corrections, and if that
 5390  delinquency results in market losses to members participants,
 5391  the employer shall reimburse each member’s participant’s account
 5392  for market losses resulting from the late contributions. If a
 5393  member participant has terminated employment and taken a
 5394  distribution, the member participant is responsible for
 5395  returning any excess contributions erroneously provided by
 5396  employers, adjusted for any investment gain or loss incurred
 5397  during the period such excess contributions were in the member’s
 5398  participant’s account. The state board or its designated agent
 5399  shall communicate to terminated members participants any
 5400  obligation to repay such excess contribution amounts. However,
 5401  the state board, its designated agents, the Florida Retirement
 5402  System Investment Plan Public Employee Optional Retirement
 5403  Program Trust Fund, the department, or the Florida Retirement
 5404  System Trust Fund may not incur any loss or gain as a result of
 5405  an employer’s correction of such excess contributions. The
 5406  third-party administrator, hired by the state board pursuant to
 5407  s. 121.4501(8), shall calculate the market losses for each
 5408  affected member participant. If contributions made on behalf of
 5409  members participants of the investment plan optional retirement
 5410  program or accompanying payroll data are not received within the
 5411  calendar month due, the employer shall also pay the cost of the
 5412  third-party administrator’s calculation and reconciliation
 5413  adjustments resulting from the late contributions. The third
 5414  party administrator shall notify the employer of the results of
 5415  the calculations and the total amount due from the employer for
 5416  such losses and the costs of calculation and reconciliation. The
 5417  employer shall remit to the Division of Retirement the amount
 5418  due within 30 working days after the date of the penalty notice
 5419  sent by the division. The division shall transfer that amount to
 5420  the third-party administrator, which shall deposit proceeds from
 5421  the 1-percent assessment and from individual market losses into
 5422  member participant accounts, as appropriate. The state board may
 5423  adopt rules to administer the provisions regarding late
 5424  contributions, late submission of payroll data, the process for
 5425  reimbursing member participant accounts for resultant market
 5426  losses, and the penalties charged to the employers.
 5427         (d) If employee contributions reported by an employer on
 5428  behalf of members are reduced as a result of employer errors or
 5429  corrections, and the member has terminated employment and taken
 5430  a refund or distribution, the employer shall be billed and is
 5431  responsible for recovering from the member any excess
 5432  contributions erroneously provided by the employer.
 5433         (e)(c) Delinquency fees specified in paragraph (a) may be
 5434  waived by the division of Retirement, with regard to pension
 5435  plan defined benefit program contributions, and by the state
 5436  board, with regard to investment plan optional retirement
 5437  program contributions, only if, in the opinion of the division
 5438  or the board, as appropriate, exceptional circumstances beyond
 5439  the employer’s control prevented remittance by the prescribed
 5440  due date notwithstanding the employer’s good faith efforts to
 5441  effect delivery. Such a waiver of delinquency may be granted an
 5442  employer only once each plan state fiscal year.
 5443         (f) If the employer submits excess employer or employee
 5444  contributions, the employer shall receive a credit to be applied
 5445  against future contributions owed. The employer is responsible
 5446  for reimbursing the member for any excess contributions
 5447  submitted if any return of such an erroneous excess pretax
 5448  contribution by the program is made within 1 year after making
 5449  erroneous contributions or such other period allowed under
 5450  applicable Internal Revenue guidance.
 5451         (g)(d) If contributions made by an employer on behalf of
 5452  members participants in the investment plan optional retirement
 5453  program are delayed in posting to member participant accounts
 5454  due to acts of God beyond the control of the Division of
 5455  Retirement, the state board, or the third-party administrator,
 5456  as applicable, market losses resulting from the late
 5457  contributions are not payable to the members participants.
 5458         Section 40. Paragraph (a) of subsection (4) and paragraph
 5459  (b) of subsection (5) of section 1012.875, Florida Statutes, are
 5460  amended, and subsection (7) is added to that section, to read:
 5461         1012.875 State Community College System Optional Retirement
 5462  Program.—Each community college may implement an optional
 5463  retirement program, if such program is established therefor
 5464  pursuant to s. 1001.64(20), under which annuity or other
 5465  contracts providing retirement and death benefits may be
 5466  purchased by, and on behalf of, eligible employees who
 5467  participate in the program, in accordance with s. 403(b) of the
 5468  Internal Revenue Code. Except as otherwise provided herein, this
 5469  retirement program, which shall be known as the State Community
 5470  College System Optional Retirement Program, may be implemented
 5471  and administered only by an individual community college or by a
 5472  consortium of community colleges.
 5473         (4)(a)1.Through June 30, 2011, each college must
 5474  contribute on behalf of each program member participant an
 5475  amount equal to 10.43 percent of the employee’s participant’s
 5476  gross monthly compensation.
 5477         2. Effective July 1, 2011, each member shall contribute an
 5478  amount equal to the employee contribution required under s.
 5479  121.71(3). The employer shall contribute on behalf of each
 5480  program member an amount equal to the difference between 10.43
 5481  percent of the employee’s gross monthly compensation and the
 5482  employee’s required contribution based on the employee’s gross
 5483  monthly compensation.
 5484         3. The college shall deduct an amount approved by the
 5485  district board of trustees of the college to provide for the
 5486  administration of the optional retirement program. Payment of
 5487  this contribution must be made either directly by the college or
 5488  through the program administrator to the designated company
 5489  contracting for payment of benefits to the program member
 5490  participant.
 5491         (5)
 5492         (b) Benefits are payable under the optional retirement
 5493  program to program participants or their beneficiaries, and the
 5494  benefits must be paid only by the designated company in
 5495  accordance with the terms of the contracts applicable to the
 5496  program participant. Benefits shall accrue in individual
 5497  accounts that are participant-directed, portable, and funded by
 5498  employer and employee contributions and the earnings thereon.
 5499  Benefits funded by employer and employee contributions are
 5500  payable in accordance with the following terms and conditions:
 5501         1. Benefits shall be payable only to a participant, to his
 5502  or her beneficiaries, or to his or her estate, as designated by
 5503  the participant.
 5504         2. Benefits shall be paid by the provider company or
 5505  companies in accordance with the law, the provisions of the
 5506  contract, and any applicable employer rule or policy.
 5507         3. In the event of a participant’s death, moneys
 5508  accumulated by, or on behalf of, the participant, less
 5509  withholding taxes remitted to the Internal Revenue Service, if
 5510  any, shall be distributed to the participant’s designated
 5511  beneficiary or beneficiaries, or to the participant’s estate, as
 5512  if the participant retired on the date of death as provided in
 5513  paragraph (d). No other death benefits are shall be available
 5514  for survivors of participants under the optional retirement
 5515  program except for such benefits, or coverage for such benefits,
 5516  as are separately afforded by the employer at the employer’s
 5517  discretion.
 5518         (7) Benefits, including employee contributions, are not
 5519  payable for employee hardships, unforeseeable emergencies,
 5520  loans, medical expenses, educational expenses, purchase of a
 5521  principal residence, payments necessary to prevent eviction or
 5522  foreclosure on an employee’s principal residence, or any other
 5523  reason before termination from all employment relationships with
 5524  participating employers for 3 calendar months.
 5525         Section 41. (1) Effective upon this act becoming a law, the
 5526  State Board of Administration and the Department of Management
 5527  Services shall request, as soon as practicable, a determination
 5528  letter and private letter ruling from the United States Internal
 5529  Revenue Service. If the United States Internal Revenue Service
 5530  refuses to act upon a request for a private letter ruling, then
 5531  a legal opinion from a qualified tax attorney or firm may be
 5532  substituted for such private letter ruling.
 5533         (2) If the board or the department receives notification
 5534  from the United States Internal Revenue Service that this act or
 5535  any portion of this act will cause the Florida Retirement
 5536  System, or a portion thereof, to be disqualified for tax
 5537  purposes under the Internal Revenue Code, then the portion that
 5538  will cause the disqualification does not apply. Upon receipt of
 5539  such notice, the state board and the department shall notify the
 5540  presiding officers of the Legislature.
 5541         Section 42. The Legislature finds that a proper and
 5542  legitimate state purpose is served when employees and retirees
 5543  of the state and its political subdivisions, and the dependents,
 5544  survivors, and beneficiaries of such employees and retirees, are
 5545  extended the basic protections afforded by governmental
 5546  retirement systems. These persons must be provided benefits that
 5547  are fair and adequate and that are managed, administered, and
 5548  funded in an actuarially sound manner, as required by s. 14,
 5549  Article X of the State Constitution and part VII of chapter 112,
 5550  Florida Statutes. Therefore, the Legislature determines and
 5551  declares that this act fulfills an important state interest.
 5552         Section 43. For the 2011-2012 fiscal year, the sums of
 5553  $207,070 of recurring funds and $31,184 of nonrecurring funds
 5554  from the Florida Retirement System Operating Trust Fund are
 5555  appropriated to, and four full-time equivalent positions are
 5556  authorized for, the Division of Retirement within the Department
 5557  of Management Services for the purpose of implementing this act.
 5558         Section 44. Except as otherwise expressly provided in this
 5559  act and except for this section, which shall take effect upon
 5560  this act becoming a law, this act shall take effect July 1,
 5561  2011.
 5562  
 5563  ================= T I T L E  A M E N D M E N T ================
 5564         And the title is amended as follows:
 5565         Delete everything before the enacting clause
 5566  and insert:
 5567                        A bill to be entitled                      
 5568         An act relating to retirement; amending ss. 110.123,
 5569         112.0801, 112.363, 112.65, and 121.011, F.S.;
 5570         conforming provisions to changes made by the act;
 5571         amending s. 121.021, F.S.; revising definitions;
 5572         amending s. 121.051, F.S.; requiring that a local
 5573         governmental entity or the governing body of a charter
 5574         school or charter technical career center make certain
 5575         elections regarding benefits at the time the entity or
 5576         governing body joins the Florida Retirement System;
 5577         requiring employee retirement contributions; providing
 5578         that employer-paid employee contributions are subject
 5579         to certain taxes; amending s. 121.0515, F.S.;
 5580         redefining membership in the Special Risk Class;
 5581         redefining criteria for Special Risk Class membership;
 5582         providing for employee contributions to be used, if
 5583         applicable, when purchasing credit for past service;
 5584         amending s. 121.052, F.S., relating to the membership
 5585         class of elected officers; conforming provisions to
 5586         changes made by the act; requiring member
 5587         contributions; providing for a refund of contributions
 5588         under certain circumstances for an officer who leaves
 5589         office; providing that a member who obtains a refund
 5590         of contributions waives certain rights under the
 5591         Florida Retirement System; amending s. 121.053, F.S.;
 5592         clarifying the employer contributions required for
 5593         Elected Officers’ Class members who participate in the
 5594         Deferred Retirement Option Program; amending s.
 5595         121.055, F.S., relating to the Senior Management
 5596         Service Class; conforming provisions to changes made
 5597         by the act; requiring employee contributions;
 5598         providing for a refund of contributions under certain
 5599         circumstances for a member who terminates employment;
 5600         providing that a member who obtains a refund of
 5601         contributions waives certain rights under the Florida
 5602         Retirement System; limiting the payment of benefits
 5603         prior to a participant’s termination of employment;
 5604         amending s. 121.061, F.S.; conforming provisions to
 5605         changes made by the act; amending s. 121.071, F.S.;
 5606         requiring employer and employee contributions to the
 5607         retirement system; providing for a refund of
 5608         contributions under certain circumstances following
 5609         termination of employment; prohibiting such refund if
 5610         an approved qualified domestic relations order is
 5611         filed against the participant’s retirement account;
 5612         providing that a member who obtains a refund of
 5613         contributions waives certain rights under the Florida
 5614         Retirement System; requiring repayment plus interest
 5615         of an invalid refund; amending s. 121.081, F.S.;
 5616         providing and revising requirements for contributions
 5617         for prior service performed on or after a certain
 5618         date; amending s. 121.091, F.S.; modifying the early
 5619         retirement benefit calculation for those members
 5620         retiring on or after a certain date or before the
 5621         normal retirement date to reflect the change in normal
 5622         retirement age; revising provisions relating to
 5623         disability retirement for judges; providing for the
 5624         refund of accumulated contributions if a member’s
 5625         employment is terminated for any reason other than
 5626         retirement; revising the interest rate on benefits for
 5627         members enrolling in drop after a certain date;
 5628         conforming provisions to changes made by the act;
 5629         amending s. 121.1001, F.S.; conforming provisions to
 5630         changes made by the act; amending s. 121.101, F.S.;.
 5631         revising the cost-of-living adjustment depending on
 5632         the date of retirement; amending s. 121.1115, F.S.;
 5633         conforming provisions to changes made by the act;
 5634         amending s. 121.1122, F.S.; conforming provisions to
 5635         changes made by the act; amending s. 121.121, F.S.;
 5636         requiring that the purchase of creditable service
 5637         following an authorized leave of absence be purchased
 5638         at the employer and employee contribution rates in
 5639         effect during the leave of absence after a certain
 5640         date; amending s. 121.125, F.S.; requiring that a
 5641         penalty be assessed against certain employers that
 5642         fail to pay the required contributions for workers’
 5643         compensation; reenacting s. 121.161, F.S.; conforming
 5644         provisions to changes made by the act; amending s.
 5645         121.182, F.S.; conforming provisions to changes made
 5646         by the act; amending s. 121.35, F.S., relating to the
 5647         optional retirement program for the State University
 5648         System; requiring employee contributions; limiting the
 5649         payment of benefits before a participant’s termination
 5650         of employment; conforming provisions to changes made
 5651         by the act; amending s. 121.355, F.S.; conforming
 5652         provisions to changes made by the act; amending s.
 5653         121.4501, F.S.; changing the name of the Public
 5654         Employee Optional Retirement Program to the Florida
 5655         Retirement System Investment Plan; requiring members
 5656         to make certain contributions to the plan; revising
 5657         and providing definitions; revising the benefit
 5658         commencement age for a member enrolled on or after a
 5659         certain date; providing for contribution adjustments
 5660         as a result of employer errors or corrections;
 5661         requiring an employer to receive a credit for excess
 5662         contributions and to reimburse an employee for excess
 5663         contributions, subject to certain limitations;
 5664         providing for a pension plan participant to retain his
 5665         or her prior plan choice following a return to
 5666         employment; prohibiting a retiree who is reemployed
 5667         from renewing membership in the plan; limiting certain
 5668         refunds of contributions which exceed the amount that
 5669         would have accrued had the member remained in the
 5670         defined benefit program; providing certain
 5671         requirements and limitations with respect to
 5672         contributions; clarifying that participant and
 5673         employer contributions are earmarked for specified
 5674         purposes; providing duties of the third-party
 5675         administrator; providing that a member is fully and
 5676         immediately vested with respect to employee
 5677         contributions paid by the member; providing for the
 5678         forfeiture of nonvested employer contributions and
 5679         service credit under certain circumstances; conforming
 5680         provisions to changes made by the act; amending s.
 5681         121.4502, F.S.; changing the name of the Public
 5682         Employee Optional Retirement Program Trust Fund to the
 5683         Florida Retirement System Investment Plan Trust Fund;
 5684         amending s. 121.4503, F.S.; providing for the deposit
 5685         of employee contributions into the Florida Retirement
 5686         System Contributions Clearing Trust Fund; amending s.
 5687         121.571, F.S.; providing requirements for submitting
 5688         employee contributions; amending s. 121.591, F.S.;
 5689         limiting the payment of benefits prior to a member’s’s
 5690         termination of employment; providing for the
 5691         forfeiture of nonvested accumulations and service
 5692         credits upon payment of certain vested benefits;
 5693         providing that the distribution payment method
 5694         selected by the member or beneficiary is final and
 5695         irrevocable at the time of benefit distribution;
 5696         prohibiting a distribution of employee contributions
 5697         if a qualified domestic relations order is filed
 5698         against the participant’s account; conforming
 5699         provisions to changes made by the act; amending s.
 5700         121.5911, F.S.; conforming provisions to changes made
 5701         by the act; amending s. 121.70, F.S.; revising
 5702         legislative intent; amending s. 121.71, F.S.;
 5703         requiring that employee contributions be deducted from
 5704         the employee’s monthly salary, beginning on a
 5705         specified date, and treated as employer contributions
 5706         under certain provisions of federal law; clarifying
 5707         that an employee may not receive such contributions
 5708         directly; specifying the required employee retirement
 5709         contribution rates for the membership of each
 5710         membership class and subclass of the Florida
 5711         Retirement System; specifying the required employer
 5712         retirement contribution rates for each membership
 5713         class and subclass of the Florida Retirement System in
 5714         order to address unfunded actuarial liabilities of the
 5715         system; requiring an assessment to be imposed if the
 5716         employee contributions remitted are less than the
 5717         amount required under certain circumstances; providing
 5718         for the employer to receive a credit for excess
 5719         contributions remitted and to apply such credit
 5720         against future contributions owed; amending ss.
 5721         121.72, 121.73, 121.74, 121.75, and 121.77, F.S.;
 5722         conforming provisions to changes made by the act;
 5723         amending s. 121.78, F.S.; requiring that certain fees
 5724         be imposed for delinquent payments for retirement
 5725         contributions; providing that an employer is
 5726         responsible for recovering any refund provided to an
 5727         employee in error; revising the terms of an authorized
 5728         waiver of delinquency; requiring an employer to
 5729         receive a credit for excess contributions and to
 5730         reimburse an employee for excess contributions,
 5731         subject to certain limitations; amending s. 1012.875,
 5732         F.S.; requiring employer and employee contributions
 5733         for members of the State Community College System
 5734         Optional Retirement Program on a certain date;
 5735         limiting the payment of benefits prior to a
 5736         participant’s termination of employment; requiring the
 5737         State Board of Administration and the Department of
 5738         Management Services to request a determination letter
 5739         and private letter ruling from the United States
 5740         Internal Revenue Service; providing legislative
 5741         findings; providing that the act fulfills an important
 5742         state interest; providing appropriations to and
 5743         authorizing additional positions for the Division of
 5744         Retirement within the Department of Management
 5745         Services; providing effective dates.