Florida Senate - 2014                             CS for SB 1114
       
       
        
       By the Committees on Governmental Oversight and Accountability;
       and Community Affairs
       
       
       
       
       585-04191-14                                          20141114c1
    1                        A bill to be entitled                      
    2         An act relating to retirement; amending s. 121.021,
    3         F.S.; revising the definition of “vested” or “vesting”
    4         to provide that a member initially enrolled in the
    5         Florida Retirement System after a certain date is
    6         vested in the pension plan after completing 10 years
    7         of creditable service; amending s. 121.051, F.S.;
    8         conforming cross-references; providing for compulsory
    9         membership in the Florida Retirement System Investment
   10         Plan for certain employees in the Elected Officers’
   11         Class or the Senior Management Service Class initially
   12         enrolled after a specified date; amending s. 121.052,
   13         F.S.; prohibiting members of the Elected Officers’
   14         Class from joining the Senior Management Service Class
   15         after a specified date; amending s. 121.053, F.S.;
   16         authorizing renewed membership in the retirement
   17         system for retirees who are reemployed in a position
   18         eligible for the Elected Officers’ Class under certain
   19         circumstances; amending s. 121.055, F.S., relating to
   20         the Senior Management Service Class; limiting the
   21         options of elected officers employed after a certain
   22         date to enroll in the class or in the Senior
   23         Management Service Optional Annuity Program; closing
   24         the Senior Management Optional Annuity Program to new
   25         members after a specified date; amending s. 121.091,
   26         F.S.; providing that certain members are entitled to a
   27         monthly disability benefit; revising provisions to
   28         conform to changes made by the act; amending s.
   29         121.122, F.S.; requiring that certain retirees who are
   30         employed on or after a specified date be renewed
   31         members in the investment plan; providing exceptions;
   32         providing that creditable service does not accrue for
   33         a reemployed retiree during a specified period;
   34         prohibiting certain funds from being paid into a
   35         renewed member’s investment plan account for a
   36         specified period of employment; requiring the renewed
   37         member to satisfy vesting requirements; prohibiting a
   38         renewed member from receiving disability benefits;
   39         specifying requirements and limitations; requiring the
   40         employer and the retiree to make applicable
   41         contributions to the member’s investment plan account;
   42         providing for the administration of the employer and
   43         employee contributions; prohibiting the purchase of
   44         past service in the investment plan during certain
   45         dates; authorizing a renewed member to receive
   46         additional credit toward the health insurance subsidy
   47         under certain circumstances; providing that a retiree
   48         employed on or after a specified date in a regularly
   49         established position eligible for the State University
   50         System Optional Retirement Program is a renewed member
   51         of that program; specifying requirements and
   52         limitations; requiring the employer and the retiree to
   53         make applicable contributions; prohibiting the
   54         purchase of past service in the program during certain
   55         dates; providing that a retiree employed on or after a
   56         specified date in a regularly established position
   57         eligible for the State Community College System
   58         Optional Retirement Program is a renewed member of
   59         that program; specifying requirements and limitations;
   60         requiring the employer and the retiree to make
   61         applicable contributions; prohibiting the purchase of
   62         past service in the program for certain dates;
   63         amending s. 121.35, F.S.; providing that certain
   64         participants in the optional retirement program for
   65         the State University System have a choice between the
   66         optional retirement program and the Florida Retirement
   67         System Investment Plan; conforming cross-references;
   68         amending s. 121.4501, F.S.; requiring certain
   69         employees initially enrolled in the Florida Retirement
   70         System on or after a specified date to be compulsory
   71         members of the investment plan; revising the
   72         definition of “eligible employee” and “member” or
   73         “employee”; revising a provision relating to
   74         acknowledgement of an employee’s election to
   75         participate in the investment plan; placing certain
   76         employees in the pension plan from his or her date of
   77         hire until they are automatically enrolled in the
   78         investment plan or timely elect enrollment in the
   79         pension plan; authorizing certain employees to elect
   80         to participate in the pension plan, rather than the
   81         default investment plan, within a specified time;
   82         specifying that a retiree who has returned to covered
   83         employment before a specified date may continue
   84         membership in his or her selected retirement plan;
   85         conforming a provision to changes made by the act;
   86         providing for the transfer of certain contributions;
   87         revising the education component; deleting the
   88         obligation of system employers to communicate the
   89         existence of both retirement plans; conforming
   90         provisions and cross-references to changes made by the
   91         act; amending s. 121.591, F.S.; revising provisions
   92         relating to disability retirement benefits; amending
   93         s. 121.71, F.S.; decreasing the employee retirement
   94         contribution rates for investment plan members;
   95         amending ss. 238.072, 413.051, and 1012.875, F.S.;
   96         conforming cross-references; providing that the act
   97         fulfills an important state interest; providing an
   98         effective date.
   99          
  100  Be It Enacted by the Legislature of the State of Florida:
  101  
  102         Section 1. Subsection (45) of section 121.021, Florida
  103  Statutes, is amended to read:
  104         121.021 Definitions.—The following words and phrases as
  105  used in this chapter have the respective meanings set forth
  106  unless a different meaning is plainly required by the context:
  107         (45) “Vested” or “vesting” means the guarantee that a
  108  member is eligible to receive a future retirement benefit upon
  109  completion of the required years of creditable service for the
  110  employee’s class of membership, even though the member may have
  111  terminated covered employment before reaching normal or early
  112  retirement date. Being vested does not entitle a member to a
  113  disability benefit. Provisions governing entitlement to
  114  disability benefits are set forth under s. 121.091(4).
  115         (a) Effective July 1, 2001, through June 30, 2011, a 6-year
  116  vesting requirement shall be implemented for the Florida
  117  Retirement System Pension Plan:
  118         1. Any member employed in a regularly established position
  119  on July 1, 2001, who completes or has completed a total of 6
  120  years of creditable service is considered vested.
  121         2. Any member initially enrolled in the Florida Retirement
  122  System before July 1, 2001, but not employed in a regularly
  123  established position on July 1, 2001, shall be deemed vested
  124  upon completion of 6 years of creditable service if such member
  125  is employed in a covered position for at least 1 work year after
  126  July 1, 2001. However, a member is not required to complete more
  127  years of creditable service than would have been required for
  128  that member to vest under retirement laws in effect before July
  129  1, 2001.
  130         3. Any member initially enrolled in the Florida Retirement
  131  System on July 1, 2001, through June 30, 2011, shall be deemed
  132  vested upon completion of 6 years of creditable service.
  133         (b) Any member initially enrolled in the Florida Retirement
  134  System on or after July 1, 2011, through June 30, 2015, shall be
  135  vested in the pension plan upon completion of 8 years of
  136  creditable service.
  137         (c) Any member initially enrolled in the Florida Retirement
  138  System on or after July 1, 2015, shall be vested in the pension
  139  plan upon completion of 10 years of creditable service.
  140         Section 2. Paragraph (c) of subsection (2) of section
  141  121.051, Florida Statutes, is amended, present subsections (3)
  142  through (9) of that section are renumbered as subsections (4)
  143  through (10), respectively, and a new subsection (3) is added to
  144  that section, to read:
  145         121.051 Participation in the system.—
  146         (2) OPTIONAL PARTICIPATION.—
  147         (c) Employees of public community colleges or charter
  148  technical career centers sponsored by public community colleges,
  149  designated in s. 1000.21(3), who are members of the Regular
  150  Class of the Florida Retirement System and who comply with the
  151  criteria set forth in this paragraph and s. 1012.875 may, in
  152  lieu of participating in the Florida Retirement System, elect to
  153  withdraw from the system altogether and participate in the State
  154  Community College System Optional Retirement Program provided by
  155  the employing agency under s. 1012.875.
  156         1.a. Through June 30, 2001, the cost to the employer for
  157  benefits under the optional retirement program is equal to
  158  equals the normal cost portion of the employer retirement
  159  contribution which would be required if the employee were a
  160  member of the pension plan’s Regular Class, plus the portion of
  161  the contribution rate required by s. 112.363(8) which would
  162  otherwise be assigned to the Retiree Health Insurance Subsidy
  163  Trust Fund.
  164         b. Effective July 1, 2001, through June 30, 2011, each
  165  employer shall contribute on behalf of each member of the
  166  optional program an amount equal to 10.43 percent of the
  167  employee’s gross monthly compensation. The employer shall deduct
  168  an amount for the administration of the program.
  169         c. Effective July 1, 2011, through June 30, 2012, each
  170  member shall contribute an amount equal to the employee
  171  contribution required under s. 121.71(3)(a). The employer shall
  172  contribute on behalf of each program member an amount equal to
  173  the difference between 10.43 percent of the employee’s gross
  174  monthly compensation and the employee’s required contribution
  175  based on the employee’s gross monthly compensation.
  176         d. Effective July 1, 2012, each member shall contribute an
  177  amount equal to the employee contribution required under s.
  178  121.71(3)(a). The employer shall contribute on behalf of each
  179  program member an amount equal to the difference between 8.15
  180  percent of the employee’s gross monthly compensation and the
  181  employee’s required contribution based on the employee’s gross
  182  monthly compensation.
  183         e. The employer shall contribute an additional amount to
  184  the Florida Retirement System Trust Fund equal to the unfunded
  185  actuarial accrued liability portion of the Regular Class
  186  contribution rate.
  187         2. The decision to participate in the optional retirement
  188  program is irrevocable as long as the employee holds a position
  189  eligible for participation, except as provided in subparagraph
  190  3. Any service creditable under the Florida Retirement System is
  191  retained after the member withdraws from the system; however,
  192  additional service credit in the system may not be earned while
  193  the employee is a member of the optional retirement program.
  194         3. An employee who has elected to participate in the
  195  optional retirement program shall have one opportunity, at the
  196  employee’s discretion, to transfer from the optional retirement
  197  program to the pension plan of the Florida Retirement System or
  198  to the investment plan established under part II of this
  199  chapter, subject to the terms of the applicable optional
  200  retirement program contracts.
  201         a. If the employee chooses to move to the investment plan,
  202  any contributions, interest, and earnings creditable to the
  203  employee under the optional retirement program are retained by
  204  the employee in the optional retirement program, and the
  205  applicable provisions of s. 121.4501(4) govern the election.
  206         b. If the employee chooses to move to the pension plan of
  207  the Florida Retirement System, the employee shall receive
  208  service credit equal to his or her years of service under the
  209  optional retirement program.
  210         (I) The cost for such credit is the amount representing the
  211  present value of the employee’s accumulated benefit obligation
  212  for the affected period of service. The cost shall be calculated
  213  as if the benefit commencement occurs on the first date the
  214  employee becomes eligible for unreduced benefits, using the
  215  discount rate and other relevant actuarial assumptions that were
  216  used to value the Florida Retirement System Pension Plan
  217  liabilities in the most recent actuarial valuation. The
  218  calculation must include any service already maintained under
  219  the pension plan in addition to the years under the optional
  220  retirement program. The present value of any service already
  221  maintained must be applied as a credit to total cost resulting
  222  from the calculation. The division must ensure that the transfer
  223  sum is prepared using a formula and methodology certified by an
  224  enrolled actuary.
  225         (II) The employee must transfer from his or her optional
  226  retirement program account and from other employee moneys as
  227  necessary, a sum representing the present value of the
  228  employee’s accumulated benefit obligation immediately following
  229  the time of such movement, determined assuming that attained
  230  service equals the sum of service in the pension plan and
  231  service in the optional retirement program.
  232         4. Participation in the optional retirement program is
  233  limited to employees who satisfy the following eligibility
  234  criteria:
  235         a. The employee is otherwise eligible for membership or
  236  renewed membership in the Regular Class of the Florida
  237  Retirement System, as provided in s. 121.021(11) and (12) or s.
  238  121.122.
  239         b. The employee is employed in a full-time position
  240  classified in the Accounting Manual for Florida’s College System
  241  Public Community Colleges as:
  242         (I) Instructional; or
  243         (II) Executive Management, Instructional Management, or
  244  Institutional Management and the community college determines
  245  that recruiting to fill a vacancy in the position is to be
  246  conducted in the national or regional market, and the duties and
  247  responsibilities of the position include the formulation,
  248  interpretation, or implementation of policies, or the
  249  performance of functions that are unique or specialized within
  250  higher education and that frequently support the mission of the
  251  community college.
  252         c. The employee is employed in a position not included in
  253  the Senior Management Service Class of the Florida Retirement
  254  System as described in s. 121.055.
  255         5. Members of the program are subject to the same
  256  reemployment limitations, renewed membership provisions, and
  257  forfeiture provisions applicable to regular members of the
  258  Florida Retirement System under ss. 121.091(9), 121.122, and
  259  121.091(5), respectively. A member who receives a program
  260  distribution funded by employer and required employee
  261  contributions is deemed to be retired from a state-administered
  262  retirement system if the member is subsequently employed with an
  263  employer that participates in the Florida Retirement System.
  264         6. Eligible community college employees are compulsory
  265  members of the Florida Retirement System until, pursuant to s.
  266  1012.875, a written election to withdraw from the system and
  267  participate in the optional retirement program is filed with the
  268  program administrator and received by the division.
  269         a. A community college employee whose program eligibility
  270  results from initial employment shall be enrolled in the
  271  optional retirement program retroactive to the first day of
  272  eligible employment. The employer and employee retirement
  273  contributions paid through the month of the employee plan change
  274  shall be transferred to the community college to the employee’s
  275  optional program account, and, effective the first day of the
  276  next month, the employer shall pay the applicable contributions
  277  based upon subparagraph 1.
  278         b. A community college employee whose program eligibility
  279  is due to the subsequent designation of the employee’s position
  280  as one of those specified in subparagraph 4., or due to the
  281  employee’s appointment, promotion, transfer, or reclassification
  282  to a position specified in subparagraph 4., must be enrolled in
  283  the program on the first day of the first full calendar month
  284  that such change in status becomes effective. The employer and
  285  employee retirement contributions paid from the effective date
  286  through the month of the employee plan change must be
  287  transferred to the community college to the employee’s optional
  288  program account, and, effective the first day of the next month,
  289  the employer shall pay the applicable contributions based upon
  290  subparagraph 1.
  291         7. Effective July 1, 2003, through December 31, 2008, a any
  292  member of the optional retirement program who has service credit
  293  in the pension plan of the Florida Retirement System for the
  294  period between his or her first eligibility to transfer from the
  295  pension plan to the optional retirement program and the actual
  296  date of transfer may, during employment, transfer to the
  297  optional retirement program a sum representing the present value
  298  of the accumulated benefit obligation under the defined benefit
  299  retirement program for the period of service credit. Upon
  300  transfer, all service credit previously earned under the pension
  301  plan during this period is nullified for purposes of entitlement
  302  to a future benefit under the pension plan.
  303         (3) COMPULSORY INVESTMENT PLAN MEMBERSHIP.—
  304         (a) Employees initially enrolled on or after July 1, 2015,
  305  in positions covered by the Elected Officers’ Class or the
  306  Senior Management Service Class are compulsory members of the
  307  investment plan, except those eligible to withdraw from the
  308  system under s. 121.052(3)(d) or s. 121.055(1)(b)2., or those
  309  eligible for optional retirement programs under paragraph
  310  (1)(a), paragraph (2)(c), or s. 121.35. Investment plan
  311  membership continues if there is subsequent employment in a
  312  position covered by another membership class. Membership in the
  313  pension plan is not permitted except as provided in s.
  314  121.591(2). Employees initially enrolled in the Florida
  315  Retirement System before July 1, 2015, may retain their
  316  membership in the pension plan or investment plan and are
  317  eligible to use the election opportunity specified in s.
  318  121.4501(4)(f); employees initially enrolled on or after July 1,
  319  2015, are not eligible to use the election opportunity.
  320         (b) Employees eligible to withdraw from the system under s.
  321  121.052(3)(d) or s. 121.055(1)(b)2. may withdraw from the system
  322  or participate in the investment plan as provided under those
  323  provisions. Employees eligible for optional retirement programs
  324  under paragraph (2)(c) or s. 121.35 may participate in the
  325  optional retirement program or the investment plan as provided
  326  in those provisions. Eligible employees required to participate
  327  pursuant to paragraph (1)(a) in the optional retirement program
  328  as provided under s. 121.35 must participate in the investment
  329  plan if employed in a position not eligible for the optional
  330  retirement program.
  331         Section 3. Paragraph (c) of subsection (3) of section
  332  121.052, Florida Statutes, is amended to read:
  333         121.052 Membership class of elected officers.—
  334         (3) PARTICIPATION AND WITHDRAWAL, GENERALLY.—Effective July
  335  1, 1990, participation in the Elected Officers’ Class shall be
  336  compulsory for elected officers listed in paragraphs (2)(a)-(d)
  337  and (f) assuming office on or after said date, unless the
  338  elected officer elects membership in another class or withdraws
  339  from the Florida Retirement System as provided in paragraphs
  340  (3)(a)-(d):
  341         (c) Before July 1, 2015, an any elected officer may, within
  342  6 months after assuming office, or within 6 months after this
  343  act becomes a law for serving elected officers, elect membership
  344  in the Senior Management Service Class as provided in s. 121.055
  345  in lieu of membership in the Elected Officers’ Class. Any Such
  346  election made by a county elected officer has shall have no
  347  effect upon the statutory limit on the number of nonelective
  348  full-time positions that may be designated by a local agency
  349  employer for inclusion in the Senior Management Service Class
  350  under s. 121.055(1)(b)1.
  351         Section 4. Subsections (3) and (5) of section 121.053,
  352  Florida Statutes, are amended to read:
  353         121.053 Participation in the Elected Officers’ Class for
  354  retired members.—
  355         (3) On or after July 1, 2010:
  356         (a) A retiree of a state-administered retirement system who
  357  is initially reemployed in elected or appointed for the first
  358  time to an elective office in a regularly established position
  359  with a covered employer may not reenroll in the Florida
  360  Retirement System, except as provided in s. 121.122.
  361         (b) An elected officer who is elected or appointed to an
  362  elective office and is participating in the Deferred Retirement
  363  Option Program is subject to termination as defined in s.
  364  121.021 upon completion of his or her DROP participation period.
  365  An elected official may defer termination as provided in
  366  subsection (7).
  367         (5) A Any renewed member, as described in s. 121.122(1),
  368  (3), (4), or (5) subsection (1) or subsection (2), who is not
  369  receiving the maximum health insurance subsidy provided in s.
  370  112.363 is entitled to earn additional credit toward the maximum
  371  health insurance subsidy. Any additional subsidy due because of
  372  such additional credit may be received only at the time of
  373  payment of the second career retirement benefit. The total
  374  health insurance subsidy received from initial and renewed
  375  membership may not exceed the maximum allowed in s. 112.363.
  376         Section 5. Paragraph (f) of subsection (1) and paragraph
  377  (c) of subsection (6) of section 121.055, Florida Statutes, are
  378  amended to read:
  379         121.055 Senior Management Service Class.—There is hereby
  380  established a separate class of membership within the Florida
  381  Retirement System to be known as the “Senior Management Service
  382  Class,” which shall become effective February 1, 1987.
  383         (1)
  384         (f) Effective July 1, 1997, through June 30, 2015:
  385         1. Except as provided in subparagraphs subparagraph 3. and
  386  4., an elected state officer eligible for membership in the
  387  Elected Officers’ Class under s. 121.052(2)(a), (b), or (c) who
  388  elects membership in the Senior Management Service Class under
  389  s. 121.052(3)(c) may, within 6 months after assuming office or
  390  within 6 months after this act becomes a law for serving elected
  391  state officers, elect to participate in the Senior Management
  392  Service Optional Annuity Program, as provided in subsection (6),
  393  in lieu of membership in the Senior Management Service Class.
  394         2. Except as provided in subparagraphs subparagraph 3. and
  395  4., an elected officer of a local agency employer eligible for
  396  membership in the Elected Officers’ Class under s. 121.052(2)(d)
  397  who elects membership in the Senior Management Service Class
  398  under s. 121.052(3)(c) may, within 6 months after assuming
  399  office, or within 6 months after this act becomes a law for
  400  serving elected officers of a local agency employer, elect to
  401  withdraw from the Florida Retirement System, as provided in
  402  subparagraph (b)2., in lieu of membership in the Senior
  403  Management Service Class.
  404         3. A retiree of a state-administered retirement system who
  405  is initially reemployed in a regularly established position on
  406  or after July 1, 2010, through December 31, 2014, as an elected
  407  official eligible for the Elected Officers’ Class may not be
  408  enrolled in renewed membership in the Senior Management Service
  409  Class or in the Senior Management Service Optional Annuity
  410  Program as provided in subsection (6), and may not withdraw from
  411  the Florida Retirement System as a renewed member as provided in
  412  subparagraph (b)2., as applicable, in lieu of membership in the
  413  Senior Management Service Class. Effective January 1, 2015, a
  414  retiree of the Senior Management Service Optional Annuity
  415  Program who retired before July 1, 2010, and is reemployed in a
  416  regularly established position with a covered employer shall be
  417  enrolled as a renewed member as provided in s. 121.122.
  418         4. On or after July 1, 2015, an elected officer eligible
  419  for membership in the Elected Officers’ Class may not be
  420  enrolled in the Senior Management Service Class or in the Senior
  421  Management Service Optional Annuity Program as provided in
  422  subsection (6).
  423         (6)
  424         (c) Participation.—
  425         1. An eligible employee who is employed on or before
  426  February 1, 1987, may elect to participate in the optional
  427  annuity program in lieu of participating in the Senior
  428  Management Service Class. Such election must be made in writing
  429  and filed with the department and the personnel officer of the
  430  employer on or before May 1, 1987. An eligible employee who is
  431  employed on or before February 1, 1987, and who fails to make an
  432  election to participate in the optional annuity program by May
  433  1, 1987, shall be deemed to have elected membership in the
  434  Senior Management Service Class.
  435         2. Except as provided in subparagraph 6., an employee who
  436  becomes eligible to participate in the optional annuity program
  437  by reason of initial employment commencing after February 1,
  438  1987, may, within 90 days after the date of commencing
  439  employment, elect to participate in the optional annuity
  440  program. Such election must be made in writing and filed with
  441  the personnel officer of the employer. An eligible employee who
  442  does not within 90 days after commencing employment elect to
  443  participate in the optional annuity program shall be deemed to
  444  have elected membership in the Senior Management Service Class.
  445         3. A person who is appointed to a position in the Senior
  446  Management Service Class and who is a member of an existing
  447  retirement system or the Special Risk or Special Risk
  448  Administrative Support Classes of the Florida Retirement System
  449  may elect to remain in such system or class in lieu of
  450  participating in the Senior Management Service Class or optional
  451  annuity program. Such election must be made in writing and filed
  452  with the department and the personnel officer of the employer
  453  within 90 days after such appointment. An eligible employee who
  454  fails to make an election to participate in the existing system,
  455  the Special Risk Class of the Florida Retirement System, the
  456  Special Risk Administrative Support Class of the Florida
  457  Retirement System, or the optional annuity program shall be
  458  deemed to have elected membership in the Senior Management
  459  Service Class.
  460         4. Except as provided in subparagraph 5., an employee’s
  461  election to participate in the optional annuity program is
  462  irrevocable if the employee continues to be employed in an
  463  eligible position and continues to meet the eligibility
  464  requirements set forth in this paragraph.
  465         5. Effective from July 1, 2002, through September 30, 2002,
  466  an active employee in a regularly established position who has
  467  elected to participate in the Senior Management Service Optional
  468  Annuity Program has one opportunity to choose to move from the
  469  Senior Management Service Optional Annuity Program to the
  470  Florida Retirement System Pension Plan.
  471         a. The election must be made in writing and must be filed
  472  with the department and the personnel officer of the employer
  473  before October 1, 2002, or, in the case of an active employee
  474  who is on a leave of absence on July 1, 2002, within 90 days
  475  after the conclusion of the leave of absence. This election is
  476  irrevocable.
  477         b. The employee shall receive service credit under the
  478  pension plan equal to his or her years of service under the
  479  Senior Management Service Optional Annuity Program. The cost for
  480  such credit is the amount representing the present value of that
  481  employee’s accumulated benefit obligation for the affected
  482  period of service.
  483         c. The employee must transfer the total accumulated
  484  employer contributions and earnings on deposit in his or her
  485  Senior Management Service Optional Annuity Program account. If
  486  the transferred amount is not sufficient to pay the amount due,
  487  the employee must pay a sum representing the remainder of the
  488  amount due. The employee may not retain any employer
  489  contributions or earnings from the Senior Management Service
  490  Optional Annuity Program account.
  491         6. A retiree of a state-administered retirement system who
  492  is initially reemployed on or after July 1, 2010, through
  493  December 31, 2014, may not renew membership in the Senior
  494  Management Service Optional Annuity Program. Effective January
  495  1, 2015, a retiree of the Senior Management Service Optional
  496  Annuity Program who retired before July 1, 2010, and is
  497  reemployed in a regularly established position with a covered
  498  employer shall be enrolled as a renewed member as provided in s.
  499  121.122.
  500         7. Effective July 1, 2015, the Senior Management Service
  501  Optional Annuity Program is closed to new members. Members
  502  enrolled in the Senior Management Service Optional Annuity
  503  Program before July 1, 2015, may retain their membership in the
  504  annuity program.
  505         Section 6. Paragraph (a) of subsection (4) of section
  506  121.091, Florida Statutes, is amended to read:
  507         121.091 Benefits payable under the system.—Benefits may not
  508  be paid under this section unless the member has terminated
  509  employment as provided in s. 121.021(39)(a) or begun
  510  participation in the Deferred Retirement Option Program as
  511  provided in subsection (13), and a proper application has been
  512  filed in the manner prescribed by the department. The department
  513  may cancel an application for retirement benefits when the
  514  member or beneficiary fails to timely provide the information
  515  and documents required by this chapter and the department’s
  516  rules. The department shall adopt rules establishing procedures
  517  for application for retirement benefits and for the cancellation
  518  of such application when the required information or documents
  519  are not received.
  520         (4) DISABILITY RETIREMENT BENEFIT.—
  521         (a) Disability retirement; entitlement and effective date.—
  522         1.a. A member who becomes totally and permanently disabled,
  523  as defined in paragraph (b), after completing 5 years of
  524  creditable service, or a member who becomes totally and
  525  permanently disabled in the line of duty regardless of service,
  526  is entitled to a monthly disability benefit,; except that any
  527  member with less than 5 years of creditable service on July 1,
  528  1980, or any person who becomes a member of the Florida
  529  Retirement System on or after such date must have completed 10
  530  years of creditable service before becoming totally and
  531  permanently disabled in order to receive disability retirement
  532  benefits for a any disability that which occurs other than in
  533  the line of duty. However, if a member employed on July 1, 1980,
  534  who has less than 5 years of creditable service as of that date
  535  becomes totally and permanently disabled after completing 5
  536  years of creditable service and is found not to have attained
  537  fully insured status for benefits under the federal Social
  538  Security Act, such member is entitled to a monthly disability
  539  benefit.
  540         b. Effective July 1, 2001, a member of the pension plan
  541  initially enrolled before July 1, 2015, who becomes totally and
  542  permanently disabled, as defined in paragraph (b), after
  543  completing 8 years of creditable service, or a member who
  544  becomes totally and permanently disabled in the line of duty
  545  regardless of service, is entitled to a monthly disability
  546  benefit.
  547         c. Effective July 1, 2015, a member of the pension plan
  548  initially enrolled on or after July 1, 2015, who becomes totally
  549  and permanently disabled, as defined in paragraph (b), after
  550  completing 10 years of creditable service, or a member who
  551  becomes totally and permanently disabled in the line of duty
  552  regardless of service, is entitled to a monthly disability
  553  benefit.
  554         2. If the division has received from the employer the
  555  required documentation of the member’s termination of employment
  556  from the employer, the effective retirement date for a member
  557  who applies and is approved for disability retirement shall be
  558  as established by rule of the division.
  559         3. For a member who is receiving Workers’ Compensation
  560  payments, the effective disability retirement date may not
  561  precede the date the member reaches Maximum Medical Improvement
  562  (MMI), unless the member terminates employment before reaching
  563  MMI.
  564         Section 7. Subsection (2) of section 121.122, Florida
  565  Statutes, is amended, and subsections (3), (4), and (5) are
  566  added to that section, to read:
  567         121.122 Renewed membership in system.—
  568         (2) Except as provided in subsections (3)-(5), a retiree of
  569  a state-administered retirement system who is initially
  570  reemployed in a regularly established position on or after July
  571  1, 2010, may not be enrolled as a renewed member.
  572         (3) A retiree of the investment plan, the State University
  573  System Optional Retirement Program, the Senior Management
  574  Service Optional Annuity Program, or the State Community College
  575  System Optional Retirement Program who retired before July 1,
  576  2010, but did not complete 10 years of creditable service and is
  577  employed in a regularly established position with a covered
  578  employer on or after January 1, 2015, shall be a renewed member
  579  of the Regular Class of the investment plan regardless of the
  580  position held, unless employed in a position eligible for
  581  participation in the State University System Optional Retirement
  582  Program or the State Community College System Optional
  583  Retirement Program as provided in subsections (4) and (5),
  584  respectively. The renewed member must satisfy the vesting
  585  requirements and other provisions of this chapter.
  586         (a) Creditable service, including credit toward the retiree
  587  health insurance subsidy provided in s. 112.363, does not accrue
  588  for a retiree’s employment in a regularly established position
  589  with a covered employer from July 1, 2010, through December 31,
  590  2014.
  591         (b) Employer and employee contributions, interest,
  592  earnings, or any other funds may not be paid into a renewed
  593  member’s investment plan account for any employment in a
  594  regularly established position with a covered employer from July
  595  1, 2010, through December 31, 2014, by the renewed member or the
  596  employer on behalf of the member.
  597         (c) To be eligible to receive a retirement benefit, the
  598  renewed member must satisfy the vesting requirements in s.
  599  121.4501(6).
  600         (d) The member is ineligible to receive disability benefits
  601  as provided in s. 121.091(4) or s. 121.591(2).
  602         (e) The member is subject to the reemployment after
  603  retirement limitations provided in s. 121.091(9), as applicable.
  604         (f) The member must satisfy the requirements for
  605  termination from employment provided in s. 121.021(39).
  606         (g) Upon the renewed membership or reemployment of a
  607  retiree, the employer and the retiree shall pay the applicable
  608  employer and employee contributions required under ss. 112.363,
  609  121.71, 121.74, and 121.76. The contributions are payable only
  610  for employment and salary earned in a regularly established
  611  position with a covered employer on or after January 1, 2015.
  612  The employer and employee contributions shall be transferred to
  613  the investment plan and placed in a default fund as designated
  614  by the state board. The retiree may move the contributions once
  615  an account is activated in the investment plan.
  616         (h) The member may not purchase any past service in the
  617  investment plan, including employment in a regularly established
  618  position with a covered employer from July 1, 2010, through
  619  December 31, 2014.
  620         (i) A renewed member who is a retiree of the investment
  621  plan and who is not receiving the maximum health insurance
  622  subsidy provided in s. 112.363 is entitled to earn additional
  623  credit toward the subsidy. Such credit may be earned only for
  624  employment in a regularly established position with a covered
  625  employer on or after January 1, 2015. Any additional subsidy due
  626  because of additional credit may be received only at the time of
  627  paying the second career retirement benefit. The total health
  628  insurance subsidy received by a retiree receiving benefits from
  629  initial and renewed membership may not exceed the maximum
  630  allowed under s. 112.363.
  631         (4) A retiree of the investment plan, the State University
  632  System Optional Retirement Program, the Senior Management
  633  Service Optional Annuity Program, or the State Community College
  634  System Optional Retirement Program who retired before July 1,
  635  2010, and is employed in a regularly established position
  636  eligible for participation in the State University System
  637  Optional Retirement Program on or after January 1, 2015, shall
  638  become a renewed member of the optional retirement program. The
  639  renewed member must satisfy the vesting requirements and other
  640  provisions of this chapter. Once enrolled, a renewed member
  641  remains enrolled in the optional retirement program while
  642  employed in an eligible position for the optional retirement
  643  program. If employment in a different covered position results
  644  in the retiree’s enrollment in the investment plan, the retiree
  645  is no longer eligible to participate in the optional retirement
  646  program unless employed in a mandatory position under s. 121.35.
  647         (a) The member is subject to the reemployment after
  648  retirement limitations provided in s. 121.091(9), as applicable.
  649         (b) The member must satisfy the requirements for
  650  termination of employment provided in s. 121.021(39).
  651         (c) Upon renewed membership or reemployment of a retiree,
  652  the employer and the retiree shall pay the applicable employer
  653  and employee contributions required under s. 121.35.
  654         (d) The member, or the employer on behalf of the member,
  655  may not purchase any prior service in the optional retirement
  656  program or employment from July 1, 2010, to December 31, 2014,
  657  when renewed membership is not available.
  658         (5) A retiree of the investment plan, the State University
  659  System Optional Retirement Program, the Senior Management
  660  Service System Optional Annuity Program, or the State Community
  661  College System Optional Retirement Program who retired before
  662  July 1, 2010, and is employed in a regularly established
  663  position eligible for participation in the State Community
  664  College System Optional Retirement Program as provided in s.
  665  121.051(2)(c)4. on or after January 1, 2015, shall become a
  666  renewed member of the optional retirement program. The renewed
  667  member must satisfy the eligibility requirements of this chapter
  668  and s. 1012.875 for the optional retirement program. Once
  669  enrolled, a renewed member remains enrolled in the optional
  670  retirement program while employed in an eligible position for
  671  the optional retirement program. If employment in a different
  672  covered position results in the retiree’s enrollment in the
  673  investment plan, the retiree is no longer eligible to
  674  participate in the optional retirement program.
  675         (a) The member is subject to the reemployment after
  676  retirement limitations provided in s. 121.091(9), as applicable.
  677         (b) The member must satisfy the requirements for
  678  termination of employment provided in s. 121.021(39).
  679         (c) Upon renewed membership or reemployment of a retiree,
  680  the employer and the retiree shall pay the applicable employer
  681  and employee contributions required under ss. 121.051(2)(c) and
  682  1012.875.
  683         (d) The member, or the employer on behalf of the member,
  684  may not purchase any past service in the optional retirement
  685  program or employment accrued from July 1, 2010, to December 31,
  686  2014.
  687         Section 8. Paragraph (c) of subsection (3) and paragraph
  688  (a) of subsection (4) of section 121.35, Florida Statutes, are
  689  amended to read:
  690         121.35 Optional retirement program for the State University
  691  System.—
  692         (3) ELECTION OF OPTIONAL PROGRAM.—
  693         (c) Any employee who becomes eligible to participate in the
  694  optional retirement program on or after January 1, 1993, shall
  695  be a compulsory participant of the program unless such employee
  696  elects membership in the Florida Retirement System. Such
  697  election shall be made in writing and filed with the personnel
  698  officer of the employer. Any eligible employee who fails to make
  699  such election within the prescribed time period shall be deemed
  700  to have elected to participate in the optional retirement
  701  program.
  702         1. Any employee whose optional retirement program
  703  eligibility results from initial employment shall be enrolled in
  704  the program at the commencement of employment. If, within 90
  705  days after commencement of employment, the employee elects
  706  membership in the Florida Retirement System, such membership
  707  shall be effective retroactive to the date of commencement of
  708  employment as provided in s. 121.4501(4).
  709         2. Any employee whose optional retirement program
  710  eligibility results from a change in status due to the
  711  subsequent designation of the employee’s position as one of
  712  those specified in paragraph (2)(a) or due to the employee’s
  713  appointment, promotion, transfer, or reclassification to a
  714  position specified in paragraph (2)(a) shall be enrolled in the
  715  optional retirement program upon such change in status and shall
  716  be notified by the employer of such action. If, within 90 days
  717  after the date of such notification, the employee elects to
  718  retain membership in the Florida Retirement System, such
  719  continuation of membership shall be retroactive to the date of
  720  the change in status.
  721         3. Notwithstanding the provisions of this paragraph,
  722  effective July 1, 1997, an any employee who is eligible to
  723  participate in the Optional Retirement Program and who fails to
  724  execute a contract with one of the approved companies and to
  725  notify the department in writing as provided in subsection (4)
  726  within 90 days after the date of eligibility shall be deemed to
  727  have elected membership in the Florida Retirement System, except
  728  as provided in s. 121.051(1)(a). This provision shall also
  729  applies apply to an any employee who terminates employment in an
  730  eligible position before executing the required investment
  731  annuity contract and notifying the department. Such membership
  732  is shall be retroactive to the date of eligibility, and all
  733  appropriate contributions shall be transferred to the Florida
  734  Retirement System Trust Fund and the Health Insurance Subsidy
  735  Trust Fund.
  736         (4) CONTRIBUTIONS.—
  737         (a)1. Through June 30, 2001, each employer shall contribute
  738  on behalf of each member of the optional retirement program an
  739  amount equal to the normal cost portion of the employer
  740  retirement contribution which would be required if the employee
  741  were a regular member of the Florida Retirement System Pension
  742  Plan, plus the portion of the contribution rate required in s.
  743  112.363(8) which that would otherwise be assigned to the Retiree
  744  Health Insurance Subsidy Trust Fund.
  745         2. Effective July 1, 2001, through June 30, 2011, each
  746  employer shall contribute on behalf of each member of the
  747  optional retirement program an amount equal to 10.43 percent of
  748  the employee’s gross monthly compensation.
  749         3. Effective July 1, 2011, through June 30, 2012, each
  750  member of the optional retirement program shall contribute an
  751  amount equal to the employee contribution required in s.
  752  121.71(3)(a). The employer shall contribute on behalf of each
  753  such member an amount equal to the difference between 10.43
  754  percent of the employee’s gross monthly compensation and the
  755  amount equal to the employee’s required contribution based on
  756  the employee’s gross monthly compensation.
  757         4. Effective July 1, 2012, each member of the optional
  758  retirement program shall contribute an amount equal to the
  759  employee contribution required in s. 121.71(3)(a). The employer
  760  shall contribute on behalf of each such member an amount equal
  761  to the difference between 8.15 percent of the employee’s gross
  762  monthly compensation and the amount equal to the employee’s
  763  required contribution based on the employee’s gross monthly
  764  compensation.
  765         5. The payment of the contributions, including
  766  contributions by the employee, shall be made by the employer to
  767  the department, which shall forward the contributions to the
  768  designated company or companies contracting for payment of
  769  benefits for members of the program. However, such contributions
  770  paid on behalf of an employee described in paragraph (3)(c) may
  771  not be forwarded to a company and do not begin to accrue
  772  interest until the employee has executed a contract and notified
  773  the department. The department shall deduct an amount from the
  774  contributions to provide for the administration of this program.
  775         Section 9. Subsection (1), paragraphs (e) and (i) of
  776  subsection (2), paragraph (b) of subsection (3), subsection (4),
  777  paragraph (c) of subsection (5), subsection (8), and paragraphs
  778  (a), (b), (c), and (h) of subsection (10) of section 121.4501,
  779  Florida Statutes, are amended to read:
  780         121.4501 Florida Retirement System Investment Plan.—
  781         (1) The Trustees of the State Board of Administration shall
  782  establish a defined contribution program called the “Florida
  783  Retirement System Investment Plan” or “investment plan” for
  784  members of the Florida Retirement System under which retirement
  785  benefits will be provided for eligible employees who elect to
  786  participate in the program and for employees initially enrolled
  787  on or after July 1, 2015, in positions covered by the Elected
  788  Officers’ Class or the Senior Management Service Class and who
  789  are compulsory members of the investment plan unless otherwise
  790  eligible to withdraw from the system under s. 121.052(3)(d) or
  791  s. 121.055(1)(b)2., or to participate in an optional retirement
  792  program under s. 121.051(1)(a), s. 121.051(2)(c), or s. 121.35.
  793  Investment plan membership continues if there is subsequent
  794  employment in a position covered by another membership class.
  795  The retirement benefits shall be provided through member
  796  directed investments, in accordance with s. 401(a) of the
  797  Internal Revenue Code and related regulations. The employer and
  798  employee shall make contributions, as provided in this section
  799  and ss. 121.571 and 121.71, to the Florida Retirement System
  800  Investment Plan Trust Fund toward the funding of benefits.
  801         (2) DEFINITIONS.—As used in this part, the term:
  802         (e) “Eligible employee” means an officer or employee, as
  803  defined in s. 121.021, who:
  804         1. Is a member of, or is eligible for membership in, the
  805  Florida Retirement System, including any renewed member of the
  806  Florida Retirement System initially enrolled before July 1,
  807  2010; or
  808         2. Participates in, or is eligible to participate in, the
  809  Senior Management Service Optional Annuity Program as
  810  established under s. 121.055(6), the State Community College
  811  System Optional Retirement Program as established under s.
  812  121.051(2)(c), or the State University System Optional
  813  Retirement Program established under s. 121.35; or
  814         3. Is a retired member of the investment plan, the State
  815  University System Optional Retirement Program, the Senior
  816  Management Service Optional Annuity Program, or the State
  817  Community College System Optional Retirement Program who retired
  818  before July 1, 2010 and is employed in a regularly established
  819  position on or after January 1, 2015, as provided in s. 121.122.
  820  
  821  The term does not include any member participating in the
  822  Deferred Retirement Option Program established under s.
  823  121.091(13), a retiree of a state-administered retirement system
  824  who retired initially reemployed in a regularly established
  825  position on or after July 1, 2010, or a mandatory participant of
  826  the State University System Optional Retirement Program
  827  established under s. 121.35.
  828         (i) “Member” or “employee” means an eligible employee who
  829  enrolls in or is defaulted into the investment plan as provided
  830  in subsection (4), a terminated Deferred Retirement Option
  831  Program member as described in subsection (21), or a beneficiary
  832  or alternate payee of a member or employee.
  833         (3) RETIREMENT SERVICE CREDIT; TRANSFER OF BENEFITS.—
  834         (b) Notwithstanding paragraph (a), an eligible employee who
  835  elects to participate in or is defaulted into the investment
  836  plan and establishes one or more individual member accounts may
  837  elect to transfer to the investment plan a sum representing the
  838  present value of the employee’s accumulated benefit obligation
  839  under the pension plan, except as provided in paragraph (4)(b).
  840  Upon transfer, all service credit earned under the pension plan
  841  is nullified for purposes of entitlement to a future benefit
  842  under the pension plan. A member may not transfer the
  843  accumulated benefit obligation balance from the pension plan
  844  after the time period for enrolling in the investment plan has
  845  expired.
  846         1. For purposes of this subsection, the present value of
  847  the member’s accumulated benefit obligation is based upon the
  848  member’s estimated creditable service and estimated average
  849  final compensation under the pension plan, subject to
  850  recomputation under subparagraph 2. For state employees, initial
  851  estimates shall be based upon creditable service and average
  852  final compensation as of midnight on June 30, 2002; for district
  853  school board employees, initial estimates shall be based upon
  854  creditable service and average final compensation as of midnight
  855  on September 30, 2002; and for local government employees,
  856  initial estimates shall be based upon creditable service and
  857  average final compensation as of midnight on December 31, 2002.
  858  The dates specified are the “estimate date” for these employees.
  859  The actuarial present value of the employee’s accumulated
  860  benefit obligation shall be based on the following:
  861         a. The discount rate and other relevant actuarial
  862  assumptions used to value the Florida Retirement System Trust
  863  Fund at the time the amount to be transferred is determined,
  864  consistent with the factors provided in sub-subparagraphs b. and
  865  c.
  866         b. A benefit commencement age, based on the member’s
  867  estimated creditable service as of the estimate date.
  868         c. Except as provided under sub-subparagraph d., for a
  869  member initially enrolled:
  870         (I) Before July 1, 2011, the benefit commencement age is
  871  the younger of the following, but may not be younger than the
  872  member’s age as of the estimate date:
  873         (A) Age 62; or
  874         (B) The age the member would attain if the member completed
  875  30 years of service with an employer, assuming the member worked
  876  continuously from the estimate date, and disregarding any
  877  vesting requirement that would otherwise apply under the pension
  878  plan.
  879         (II) On or after July 1, 2011, the benefit commencement age
  880  is the younger of the following, but may not be younger than the
  881  member’s age as of the estimate date:
  882         (A) Age 65; or
  883         (B) The age the member would attain if the member completed
  884  33 years of service with an employer, assuming the member worked
  885  continuously from the estimate date, and disregarding any
  886  vesting requirement that would otherwise apply under the pension
  887  plan.
  888         d. For members of the Special Risk Class and for members of
  889  the Special Risk Administrative Support Class entitled to retain
  890  the special risk normal retirement date:
  891         (I) Initially enrolled before July 1, 2011, the benefit
  892  commencement age is the younger of the following, but may not be
  893  younger than the member’s age as of the estimate date:
  894         (A) Age 55; or
  895         (B) The age the member would attain if the member completed
  896  25 years of service with an employer, assuming the member worked
  897  continuously from the estimate date, and disregarding any
  898  vesting requirement that would otherwise apply under the pension
  899  plan.
  900         (II) Initially enrolled on or after July 1, 2011, the
  901  benefit commencement age is the younger of the following, but
  902  may not be younger than the member’s age as of the estimate
  903  date:
  904         (A) Age 60; or
  905         (B) The age the member would attain if the member completed
  906  30 years of service with an employer, assuming the member worked
  907  continuously from the estimate date, and disregarding any
  908  vesting requirement that would otherwise apply under the pension
  909  plan.
  910         e. The calculation must disregard vesting requirements and
  911  early retirement reduction factors that would otherwise apply
  912  under the pension plan.
  913         2. For each member who elects to transfer moneys from the
  914  pension plan to his or her account in the investment plan, the
  915  division shall recompute the amount transferred under
  916  subparagraph 1. within 60 days after the actual transfer of
  917  funds based upon the member’s actual creditable service and
  918  actual final average compensation as of the initial date of
  919  participation in the investment plan. If the recomputed amount
  920  differs from the amount transferred by $10 or more, the division
  921  shall:
  922         a. Transfer, or cause to be transferred, from the Florida
  923  Retirement System Trust Fund to the member’s account the excess,
  924  if any, of the recomputed amount over the previously transferred
  925  amount together with interest from the initial date of transfer
  926  to the date of transfer under this subparagraph, based upon the
  927  effective annual interest equal to the assumed return on the
  928  actuarial investment which was used in the most recent actuarial
  929  valuation of the system, compounded annually.
  930         b. Transfer, or cause to be transferred, from the member’s
  931  account to the Florida Retirement System Trust Fund the excess,
  932  if any, of the previously transferred amount over the recomputed
  933  amount, together with interest from the initial date of transfer
  934  to the date of transfer under this subparagraph, based upon 6
  935  percent effective annual interest, compounded annually, pro rata
  936  based on the member’s allocation plan.
  937         3. If contribution adjustments are made as a result of
  938  employer errors or corrections, including plan corrections,
  939  following recomputation of the amount transferred under
  940  subparagraph 1., the member is entitled to the additional
  941  contributions or is responsible for returning any excess
  942  contributions resulting from the correction. However, a any
  943  return of such erroneous excess pretax contribution by the plan
  944  must be made within the period allowed by the Internal Revenue
  945  Service. The present value of the member’s accumulated benefit
  946  obligation may shall not be recalculated.
  947         4. As directed by the member, the state board shall
  948  transfer or cause to be transferred the appropriate amounts to
  949  the designated accounts within 30 days after the effective date
  950  of the member’s participation in the investment plan unless the
  951  major financial markets for securities available for a transfer
  952  are seriously disrupted by an unforeseen event that causes the
  953  suspension of trading on a any national securities exchange in
  954  the country where the securities were issued. In that event, the
  955  30-day period may be extended by a resolution of the state
  956  board. Transfers are not commissionable or subject to other fees
  957  and may be in the form of securities or cash, as determined by
  958  the state board. Such securities are valued as of the date of
  959  receipt in the member’s account.
  960         5. If the state board or the division receives notification
  961  from the United States Internal Revenue Service that this
  962  paragraph or any portion of this paragraph will cause the
  963  retirement system, or a portion thereof, to be disqualified for
  964  tax purposes under the Internal Revenue Code, the portion that
  965  will cause the disqualification does not apply. Upon such
  966  notice, the state board and the division shall notify the
  967  presiding officers of the Legislature.
  968         (4) PARTICIPATION; ENROLLMENT.—
  969         (a)1. Effective June 1, 2002, through February 28, 2003, a
  970  90-day election period, preceded by a 90-day education period,
  971  was provided to each eligible employee participating in the
  972  Florida Retirement System which permitted each eligible employee
  973  to elect membership in the investment plan, and an employee who
  974  failed to elect the investment plan during the election period
  975  remained in the pension plan. An eligible employee who was
  976  employed in a regularly established position during the election
  977  period was granted the option to make one subsequent election,
  978  as provided in paragraph (f). With respect to an eligible
  979  employee who did not participate in the initial election period
  980  or who is initially employee who is employed in a regularly
  981  established position after the close of the initial election
  982  period but before July 1, 2015, on June 1, 2002, by a state
  983  employer:
  984         a. Any such employee may elect to participate in the
  985  investment plan in lieu of retaining his or her membership in
  986  the pension plan. The election must be made in writing or by
  987  electronic means and must be filed with the third-party
  988  administrator by August 31, 2002, or, in the case of an active
  989  employee who is on a leave of absence on April 1, 2002, by the
  990  last business day of the 5th month following the month the leave
  991  of absence concludes. This election is irrevocable, except as
  992  provided in paragraph (g). Upon making such election, the
  993  employee shall be enrolled as a member of the investment plan,
  994  the employee’s membership in the Florida Retirement System is
  995  governed by the provisions of this part, and the employee’s
  996  membership in the pension plan terminates. The employee’s
  997  enrollment in the investment plan is effective the first day of
  998  the month for which a full month’s employer contribution is made
  999  to the investment plan.
 1000         b. Any such employee who fails to elect to participate in
 1001  the investment plan within the prescribed time period is deemed
 1002  to have elected to retain membership in the pension plan, and
 1003  the employee’s option to elect to participate in the investment
 1004  plan is forfeited.
 1005         2. With respect to employees who become eligible to
 1006  participate in the investment plan by reason of employment in a
 1007  regularly established position with a state employer commencing
 1008  after April 1, 2002:
 1009         a. Any such employee shall, by default, be enrolled in the
 1010  pension plan at the commencement of employment, and may, by the
 1011  last business day of the 5th month following the employee’s
 1012  month of hire, elect to participate in the investment plan. The
 1013  employee’s election must be made in writing or by electronic
 1014  means and must be filed with the third-party administrator. The
 1015  election to participate in the investment plan is irrevocable,
 1016  except as provided in paragraph (f) (g).
 1017         a.b. If the employee files such election within the
 1018  prescribed time period, enrollment in the investment plan is
 1019  effective on the first day of employment. The retirement
 1020  contributions paid through the month of the employee plan change
 1021  shall be transferred to the investment program, and, effective
 1022  the first day of the next month, the employer and employee must
 1023  pay the applicable contributions based on the employee
 1024  membership class in the program.
 1025         b.c. An employee who fails to elect to participate in the
 1026  investment plan within the prescribed time period is deemed to
 1027  have elected to retain membership in the pension plan, and the
 1028  employee’s option to elect to participate in the investment plan
 1029  is forfeited.
 1030         2.3. With respect to employees who become eligible to
 1031  participate in the investment plan pursuant to s.
 1032  121.051(2)(c)3. or s. 121.35(3)(i), the employee may elect to
 1033  participate in the investment plan in lieu of retaining his or
 1034  her membership in the State Community College System Optional
 1035  Retirement Program or the State University System Optional
 1036  Retirement Program. The election must be made in writing or by
 1037  electronic means and must be filed with the third-party
 1038  administrator. This election is irrevocable, except as provided
 1039  in paragraph (f) (g). Upon making such election, the employee
 1040  shall be enrolled as a member in the investment plan, the
 1041  employee’s membership in the Florida Retirement System is
 1042  governed by the provisions of this part, and the employee’s
 1043  participation in the State Community College System Optional
 1044  Retirement Program or the State University System Optional
 1045  Retirement Program terminates. The employee’s enrollment in the
 1046  investment plan is effective on the first day of the month for
 1047  which a full month’s employer and employee contribution is made
 1048  to the investment plan.
 1049         4. For purposes of this paragraph, “state employer” means
 1050  any agency, board, branch, commission, community college,
 1051  department, institution, institution of higher education, or
 1052  water management district of the state, which participates in
 1053  the Florida Retirement System for the benefit of certain
 1054  employees.
 1055         (b) With respect to employees who become eligible to
 1056  participate in the investment plan, except as provided in
 1057  paragraph (g), by reason of employment in a regularly
 1058  established position commencing on or after July 1, 2015, such
 1059  employee shall be enrolled in the pension plan at the
 1060  commencement of employment and may, by the last business day of
 1061  the 8th month following the employee’s month of hire, elect to
 1062  participate in the pension plan or the investment plan. Eligible
 1063  employees may make a plan election only if they are earning
 1064  service credit in an employer-employee relationship consistent
 1065  with s. 121.021(17)(b), excluding leaves of absence without pay.
 1066         1. The employee’s election must be in writing or by
 1067  electronic means and must be filed with the third-party
 1068  administrator. The election to participate in the pension plan
 1069  or investment plan is irrevocable, except as provided in
 1070  paragraph (f).
 1071         2. If the employee fails to make an election of the pension
 1072  plan or investment plan within 8 months following the month of
 1073  hire, the employee is deemed to have elected the investment plan
 1074  and will be defaulted into the investment plan retroactively to
 1075  the employee’s date of employment. The employee’s option to
 1076  participate in the pension plan is forfeited, except as provided
 1077  in paragraph (f).
 1078         3. The amount of the employee and employer contributions
 1079  paid before the default to the investment plan shall be
 1080  transferred to the investment plan and placed in a default fund
 1081  as designated by the State Board of Administration. The employee
 1082  may move the contributions once an account is activated in the
 1083  investment plan.
 1084         4. Effective the first day of the month after an eligible
 1085  employee makes a plan election of the pension plan or investment
 1086  plan, or after the month of default to the investment plan, the
 1087  employee and employer shall pay the applicable contributions
 1088  based on the employee membership class in the pension plan or
 1089  investment plan.
 1090         (b)1. With respect to an eligible employee who is employed
 1091  in a regularly established position on September 1, 2002, by a
 1092  district school board employer:
 1093         a. Any such employee may elect to participate in the
 1094  investment plan in lieu of retaining his or her membership in
 1095  the pension plan. The election must be made in writing or by
 1096  electronic means and must be filed with the third-party
 1097  administrator by November 30, or, in the case of an active
 1098  employee who is on a leave of absence on July 1, 2002, by the
 1099  last business day of the 5th month following the month the leave
 1100  of absence concludes. This election is irrevocable, except as
 1101  provided in paragraph (g). Upon making such election, the
 1102  employee shall be enrolled as a member of the investment plan,
 1103  the employee’s membership in the Florida Retirement System is
 1104  governed by the provisions of this part, and the employee’s
 1105  membership in the pension plan terminates. The employee’s
 1106  enrollment in the investment plan is effective the first day of
 1107  the month for which a full month’s employer contribution is made
 1108  to the investment program.
 1109         b. Any such employee who fails to elect to participate in
 1110  the investment plan within the prescribed time period is deemed
 1111  to have elected to retain membership in the pension plan, and
 1112  the employee’s option to elect to participate in the investment
 1113  plan is forfeited.
 1114         2. With respect to employees who become eligible to
 1115  participate in the investment plan by reason of employment in a
 1116  regularly established position with a district school board
 1117  employer commencing after July 1, 2002:
 1118         a. Any such employee shall, by default, be enrolled in the
 1119  pension plan at the commencement of employment, and may, by the
 1120  last business day of the 5th month following the employee’s
 1121  month of hire, elect to participate in the investment plan. The
 1122  employee’s election must be made in writing or by electronic
 1123  means and must be filed with the third-party administrator. The
 1124  election to participate in the investment plan is irrevocable,
 1125  except as provided in paragraph (g).
 1126         b. If the employee files such election within the
 1127  prescribed time period, enrollment in the investment plan is
 1128  effective on the first day of employment. The employer
 1129  retirement contributions paid through the month of the employee
 1130  plan change shall be transferred to the investment plan, and,
 1131  effective the first day of the next month, the employer shall
 1132  pay the applicable contributions based on the employee
 1133  membership class in the investment plan.
 1134         c. Any such employee who fails to elect to participate in
 1135  the investment plan within the prescribed time period is deemed
 1136  to have elected to retain membership in the pension plan, and
 1137  the employee’s option to elect to participate in the investment
 1138  plan is forfeited.
 1139         3. For purposes of this paragraph, “district school board
 1140  employer” means any district school board that participates in
 1141  the Florida Retirement System for the benefit of certain
 1142  employees, or a charter school or charter technical career
 1143  center that participates in the Florida Retirement System as
 1144  provided in s. 121.051(2)(d).
 1145         (c)1. With respect to an eligible employee who is employed
 1146  in a regularly established position on December 1, 2002, by a
 1147  local employer:
 1148         a. Any such employee may elect to participate in the
 1149  investment plan in lieu of retaining his or her membership in
 1150  the pension plan. The election must be made in writing or by
 1151  electronic means and must be filed with the third-party
 1152  administrator by February 28, 2003, or, in the case of an active
 1153  employee who is on a leave of absence on October 1, 2002, by the
 1154  last business day of the 5th month following the month the leave
 1155  of absence concludes. This election is irrevocable, except as
 1156  provided in paragraph (g). Upon making such election, the
 1157  employee shall be enrolled as a participant of the investment
 1158  plan, the employee’s membership in the Florida Retirement System
 1159  is governed by the provisions of this part, and the employee’s
 1160  membership in the pension plan terminates. The employee’s
 1161  enrollment in the investment plan is effective the first day of
 1162  the month for which a full month’s employer contribution is made
 1163  to the investment plan.
 1164         b. Any such employee who fails to elect to participate in
 1165  the investment plan within the prescribed time period is deemed
 1166  to have elected to retain membership in the pension plan, and
 1167  the employee’s option to elect to participate in the investment
 1168  plan is forfeited.
 1169         2. With respect to employees who become eligible to
 1170  participate in the investment plan by reason of employment in a
 1171  regularly established position with a local employer commencing
 1172  after October 1, 2002:
 1173         a. Any such employee shall, by default, be enrolled in the
 1174  pension plan at the commencement of employment, and may, by the
 1175  last business day of the 5th month following the employee’s
 1176  month of hire, elect to participate in the investment plan. The
 1177  employee’s election must be made in writing or by electronic
 1178  means and must be filed with the third-party administrator. The
 1179  election to participate in the investment plan is irrevocable,
 1180  except as provided in paragraph (g).
 1181         b. If the employee files such election within the
 1182  prescribed time period, enrollment in the investment plan is
 1183  effective on the first day of employment. The employer
 1184  retirement contributions paid through the month of the employee
 1185  plan change shall be transferred to the investment plan, and,
 1186  effective the first day of the next month, the employer shall
 1187  pay the applicable contributions based on the employee
 1188  membership class in the investment plan.
 1189         c. Any such employee who fails to elect to participate in
 1190  the investment plan within the prescribed time period is deemed
 1191  to have elected to retain membership in the pension plan, and
 1192  the employee’s option to elect to participate in the investment
 1193  plan is forfeited.
 1194         3. For purposes of this paragraph, “local employer” means
 1195  any employer not included in paragraph (a) or paragraph (b).
 1196         (c)(d) Contributions available for self-direction by a
 1197  member who has not selected one or more specific investment
 1198  products shall be allocated as prescribed by the state board.
 1199  The third-party administrator shall notify the member at least
 1200  quarterly that the member should take an affirmative action to
 1201  make an asset allocation among the investment products.
 1202         (d)(e) On or after July 1, 2011, a member of the pension
 1203  plan who obtains a refund of employee contributions retains his
 1204  or her prior plan choice upon return to employment in a
 1205  regularly established position with a participating employer.
 1206         (e)(f) A member of the investment plan who takes a
 1207  distribution of any contributions from his or her investment
 1208  plan account is considered a retiree. A member retiree who
 1209  retires is initially reemployed in a regularly established
 1210  position on or after July 1, 2010, is not eligible to be
 1211  enrolled in renewed membership. A member who retired before July
 1212  1, 2010, and is employed on or after January 1, 2015, in a
 1213  regularly established position shall be a renewed member as
 1214  provided in s. 121.122, except that a retiree who has returned
 1215  to covered employment before July 1, 2010, may continue
 1216  membership in the plan he or she chooses.
 1217         (f)(g) After the period during which an eligible employee
 1218  had the choice to elect the pension plan or the investment plan,
 1219  or the month following the receipt of the eligible employee’s
 1220  plan election, if sooner, the employee shall have one
 1221  opportunity, at the employee’s discretion, to choose to move
 1222  from the pension plan to the investment plan or from the
 1223  investment plan to the pension plan. Eligible employees may
 1224  elect to move between plans only if they are earning service
 1225  credit in an employer-employee relationship consistent with s.
 1226  121.021(17)(b), excluding leaves of absence without pay.
 1227  Effective July 1, 2005, such elections are effective on the
 1228  first day of the month following the receipt of the election by
 1229  the third-party administrator and are not subject to the
 1230  requirements regarding an employer-employee relationship or
 1231  receipt of contributions for the eligible employee in the
 1232  effective month, except when the election is received by the
 1233  third-party administrator. This paragraph is contingent upon
 1234  approval by the Internal Revenue Service. This paragraph is not
 1235  applicable to compulsory investment plan members under paragraph
 1236  (g).
 1237         1. If the employee chooses to move to the investment plan,
 1238  the provisions of subsection (3) governs govern the transfer.
 1239         2. If the employee chooses to move to the pension plan, the
 1240  employee must transfer from his or her investment plan account,
 1241  and from other employee moneys as necessary, a sum representing
 1242  the present value of that employee’s accumulated benefit
 1243  obligation immediately following the time of such movement,
 1244  determined assuming that attained service equals the sum of
 1245  service in the pension plan and service in the investment plan.
 1246  Benefit commencement occurs on the first date the employee is
 1247  eligible for unreduced benefits, using the discount rate and
 1248  other relevant actuarial assumptions that were used to value the
 1249  pension plan liabilities in the most recent actuarial valuation.
 1250  For an any employee who, at the time of the second election,
 1251  already maintains an accrued benefit amount in the pension plan,
 1252  the then-present value of the accrued benefit is deemed part of
 1253  the required transfer amount. The division must ensure that the
 1254  transfer sum is prepared using a formula and methodology
 1255  certified by an enrolled actuary. A refund of any employee
 1256  contributions or additional member payments made which exceed
 1257  the employee contributions that would have accrued had the
 1258  member remained in the pension plan and not transferred to the
 1259  investment plan is not permitted.
 1260         3. Notwithstanding subparagraph 2., an employee who chooses
 1261  to move to the pension plan and who became eligible to
 1262  participate in the investment plan by reason of employment in a
 1263  regularly established position with a state employer after June
 1264  1, 2002; a district school board employer after September 1,
 1265  2002; or a local employer after December 1, 2002, must transfer
 1266  from his or her investment plan account, and from other employee
 1267  moneys as necessary, a sum representing the employee’s actuarial
 1268  accrued liability. A refund of any employee contributions or
 1269  additional member participant payments made which exceed the
 1270  employee contributions that would have accrued had the member
 1271  remained in the pension plan and not transferred to the
 1272  investment plan is not permitted.
 1273         4. An employee’s ability to transfer from the pension plan
 1274  to the investment plan pursuant to paragraphs (a) and (b) (a)
 1275  (d), and the ability of a current employee to have an option to
 1276  later transfer back into the pension plan under subparagraph 2.,
 1277  shall be deemed a significant system amendment. Pursuant to s.
 1278  121.031(4), any resulting unfunded liability arising from actual
 1279  original transfers from the pension plan to the investment plan
 1280  must be amortized within 30 plan years as a separate unfunded
 1281  actuarial base independent of the reserve stabilization
 1282  mechanism described defined in s. 121.031(3)(f). For the first
 1283  25 years, a direct amortization payment may not be calculated
 1284  for this base. During this 25-year period, the separate base
 1285  shall be used to offset the impact of employees exercising their
 1286  second program election under this paragraph. The actuarial
 1287  funded status of the pension plan will not be affected by such
 1288  second program elections in any significant manner, after due
 1289  recognition of the separate unfunded actuarial base. Following
 1290  the initial 25-year period, any remaining balance of the
 1291  original separate base shall be amortized over the remaining 5
 1292  years of the required 30-year amortization period.
 1293         5. If the employee chooses to transfer from the investment
 1294  plan to the pension plan and retains an excess account balance
 1295  in the investment plan after satisfying the buy-in requirements
 1296  under this paragraph, the excess may not be distributed until
 1297  the member retires from the pension plan. The excess account
 1298  balance may be rolled over to the pension plan and used to
 1299  purchase service credit or upgrade creditable service in the
 1300  pension plan.
 1301         (g) All employees initially enrolled on or after July 1,
 1302  2015, in positions covered by the Elected Officers’ Class or the
 1303  Senior Management Service Class are compulsory members of the
 1304  investment plan, except those eligible to withdraw from the
 1305  system under s. 121.052(3)(d) or s. 121.055(1)(b)2., or those
 1306  eligible for optional retirement programs under s.
 1307  121.051(1)(a), s. 121.051(2)(c), or s. 121.35. Employees
 1308  eligible to withdraw from the system under s. 121.052(3)(d) or
 1309  s. 121.055(1)(b)2. may withdraw from the system or participate
 1310  in the investment plan as provided in those sections. Employees
 1311  eligible for optional retirement programs under s. 121.051(2)(c)
 1312  or s. 121.35, except as provided in s. 121.051(1)(a), may
 1313  participate in the optional retirement program or the investment
 1314  plan as provided in those sections. Investment plan membership
 1315  continues if there is subsequent employment in a position
 1316  covered by another membership class.
 1317         1. Membership in the pension plan is not permitted except
 1318  as provided in s. 121.591(2). Employees initially enrolled in
 1319  the Florida Retirement System before July 1, 2015, may retain
 1320  their membership in the pension plan or investment plan and are
 1321  eligible to use the election opportunity specified in paragraph
 1322  (f).
 1323         2. Employees initially enrolled on or after July 1, 2015,
 1324  may not use the election opportunity specified in paragraph (f).
 1325         3. The amount of retirement contributions paid by the
 1326  employee and employer, as required under s. 121.72, shall be
 1327  placed in a default fund as designated by the state board, until
 1328  an account is activated in the investment plan, at which time
 1329  the member may move the contributions from the default fund to
 1330  other funds provided in the investment plan.
 1331         (5) CONTRIBUTIONS.—
 1332         (c) The state board, acting as plan fiduciary, shall must
 1333  ensure that all plan assets are held in a trust, pursuant to s.
 1334  401 of the Internal Revenue Code. The fiduciary shall must
 1335  ensure that such contributions are allocated as follows:
 1336         1. The employer and employee contribution portion earmarked
 1337  for member accounts shall be used to purchase interests in the
 1338  appropriate investment vehicles as specified by the member, or
 1339  in accordance with paragraph (4)(c) (4)(d).
 1340         2. The employer contribution portion earmarked for
 1341  administrative and educational expenses shall be transferred to
 1342  the Florida Retirement System Investment Plan Trust Fund.
 1343         3. The employer contribution portion earmarked for
 1344  disability benefits shall be transferred to the Florida
 1345  Retirement System Trust Fund.
 1346         (8) INVESTMENT PLAN ADMINISTRATION.—The investment plan
 1347  shall be administered by the state board and affected employers.
 1348  The state board may require oaths, by affidavit or otherwise,
 1349  and acknowledgments from persons in connection with the
 1350  administration of its statutory duties and responsibilities for
 1351  the investment plan. An oath, by affidavit or otherwise, is may
 1352  not be required of a member at the time of enrollment.
 1353  Acknowledgment of an employee’s election to participate in the
 1354  program may shall be no greater than necessary to confirm the
 1355  employee’s election except for members initially enrolled on or
 1356  after July 1, 2015, as provided in paragraph (4)(g). The state
 1357  board shall adopt rules to carry out its statutory duties with
 1358  respect to administering the investment plan, including
 1359  establishing the roles and responsibilities of affected state,
 1360  local government, and education-related employers, the state
 1361  board, the department, and third-party contractors. The
 1362  department shall adopt rules necessary to administer the
 1363  investment plan in coordination with the pension plan and the
 1364  disability benefits available under the investment plan.
 1365         (a)1. The state board shall select and contract with a
 1366  third-party administrator to provide administrative services if
 1367  those services cannot be competitively and contractually
 1368  provided by the division. With the approval of the state board,
 1369  the third-party administrator may subcontract to provide
 1370  components of the administrative services. As a cost of
 1371  administration, the state board may compensate any such
 1372  contractor for its services, in accordance with the terms of the
 1373  contract, as is deemed necessary or proper by the board. The
 1374  third-party administrator may not be an approved provider or be
 1375  affiliated with an approved provider.
 1376         2. These administrative services may include, but are not
 1377  limited to, enrollment of eligible employees, collection of
 1378  employer and employee contributions, disbursement of
 1379  contributions to approved providers in accordance with the
 1380  allocation directions of members; services relating to
 1381  consolidated billing; individual and collective recordkeeping
 1382  and accounting; asset purchase, control, and safekeeping; and
 1383  direct disbursement of funds to and from the third-party
 1384  administrator, the division, the state board, employers,
 1385  members, approved providers, and beneficiaries. This section
 1386  does not prevent or prohibit a bundled provider from providing
 1387  any administrative or customer service, including accounting and
 1388  administration of individual member benefits and contributions;
 1389  individual member recordkeeping; asset purchase, control, and
 1390  safekeeping; direct execution of the member’s instructions as to
 1391  asset and contribution allocation; calculation of daily net
 1392  asset values; direct access to member account information; or
 1393  periodic reporting to members, at least quarterly, on account
 1394  balances and transactions, if these services are authorized by
 1395  the state board as part of the contract.
 1396         (b)1. The state board shall select and contract with one or
 1397  more organizations to provide educational services. With
 1398  approval of the state board, the organizations may subcontract
 1399  to provide components of the educational services. As a cost of
 1400  administration, the state board may compensate any such
 1401  contractor for its services in accordance with the terms of the
 1402  contract, as is deemed necessary or proper by the board. The
 1403  education organization may not be an approved provider or be
 1404  affiliated with an approved provider.
 1405         2. Educational services shall be designed by the state
 1406  board and department to assist employers, eligible employees,
 1407  members, and beneficiaries in order to maintain compliance with
 1408  United States Department of Labor regulations under s. 404(c) of
 1409  the Employee Retirement Income Security Act of 1974 and to
 1410  assist employees in their choice of pension plan or investment
 1411  plan retirement alternatives. Educational services include, but
 1412  are not limited to, disseminating educational materials;
 1413  providing retirement planning education; explaining the pension
 1414  plan and the investment plan; and offering financial planning
 1415  guidance on matters such as investment diversification,
 1416  investment risks, investment costs, and asset allocation. An
 1417  approved provider may also provide educational information,
 1418  including retirement planning and investment allocation
 1419  information concerning its products and services.
 1420         (c)1. In evaluating and selecting a third-party
 1421  administrator, the state board shall establish criteria for
 1422  evaluating the relative capabilities and qualifications of each
 1423  proposed administrator. In developing such criteria, the state
 1424  board shall consider:
 1425         a. The administrator’s demonstrated experience in providing
 1426  administrative services to public or private sector retirement
 1427  systems.
 1428         b. The administrator’s demonstrated experience in providing
 1429  daily valued recordkeeping to defined contribution programs.
 1430         c. The administrator’s ability and willingness to
 1431  coordinate its activities with employers, the state board, and
 1432  the division, and to supply to such employers, the board, and
 1433  the division the information and data they require, including,
 1434  but not limited to, monthly management reports, quarterly member
 1435  reports, and ad hoc reports requested by the department or state
 1436  board.
 1437         d. The cost-effectiveness and levels of the administrative
 1438  services provided.
 1439         e. The administrator’s ability to interact with the
 1440  members, the employers, the state board, the division, and the
 1441  providers; the means by which members may access account
 1442  information, direct investment of contributions, make changes to
 1443  their accounts, transfer moneys between available investment
 1444  vehicles, and transfer moneys between investment products; and
 1445  any fees that apply to such activities.
 1446         f. Any other factor deemed necessary by the state board.
 1447         2. In evaluating and selecting an educational provider, the
 1448  state board shall establish criteria under which it shall
 1449  consider the relative capabilities and qualifications of each
 1450  proposed educational provider. In developing such criteria, the
 1451  state board shall consider:
 1452         a. Demonstrated experience in providing educational
 1453  services to public or private sector retirement systems.
 1454         b. Ability and willingness to coordinate its activities
 1455  with the employers, the state board, and the division, and to
 1456  supply to such employers, the board, and the division the
 1457  information and data they require, including, but not limited
 1458  to, reports on educational contacts.
 1459         c. The cost-effectiveness and levels of the educational
 1460  services provided.
 1461         d. Ability to provide educational services via different
 1462  media, including, but not limited to, the Internet, personal
 1463  contact, seminars, brochures, and newsletters.
 1464         e. Any other factor deemed necessary by the state board.
 1465         3. The establishment of the criteria shall be solely within
 1466  the discretion of the state board.
 1467         (d) The state board shall develop the form and content of
 1468  any contracts to be offered under the investment plan. In
 1469  developing the contracts, the board shall consider:
 1470         1. The nature and extent of the rights and benefits to be
 1471  afforded in relation to the contributions required under the
 1472  plan.
 1473         2. The suitability of the rights and benefits provided and
 1474  the interests of employers in the recruitment and retention of
 1475  eligible employees.
 1476         (e)1. The state board may contract for professional
 1477  services, including legal, consulting, accounting, and actuarial
 1478  services, deemed necessary to implement and administer the
 1479  investment plan. The state board may enter into a contract with
 1480  one or more vendors to provide low-cost investment advice to
 1481  members, supplemental to education provided by the third-party
 1482  administrator. All fees under any such contract shall be paid by
 1483  those members who choose to use the services of the vendor.
 1484         2. The department may contract for professional services,
 1485  including legal, consulting, accounting, and actuarial services,
 1486  deemed necessary to implement and administer the investment plan
 1487  in coordination with the pension plan. The department, in
 1488  coordination with the state board, may enter into a contract
 1489  with the third-party administrator in order to coordinate
 1490  services common to the various programs within the Florida
 1491  Retirement System.
 1492         (f) The third-party administrator may not receive direct or
 1493  indirect compensation from an approved provider, except as
 1494  specifically provided for in the contract with the state board.
 1495         (g) The state board shall receive and resolve member
 1496  complaints against the program, the third-party administrator,
 1497  or any program vendor or provider; shall resolve any conflict
 1498  between the third-party administrator and an approved provider
 1499  if such conflict threatens the implementation or administration
 1500  of the program or the quality of services to employees; and may
 1501  resolve any other conflicts. The third-party administrator shall
 1502  retain all member records for at least 5 years for use in
 1503  resolving any member conflicts. The state board, the third-party
 1504  administrator, or a provider is not required to produce
 1505  documentation or an audio recording to justify action taken with
 1506  regard to a member if the action occurred 5 or more years before
 1507  the complaint is submitted to the state board. It is presumed
 1508  that all action taken 5 or more years before the complaint is
 1509  submitted was taken at the request of the member and with the
 1510  member’s full knowledge and consent. To overcome this
 1511  presumption, the member must present documentary evidence or an
 1512  audio recording demonstrating otherwise.
 1513         (10) EDUCATION COMPONENT.—
 1514         (a) The state board, in coordination with the department,
 1515  shall provide for an education component for eligible employees
 1516  system members in a manner consistent with the provisions of
 1517  this subsection section. The education component must be
 1518  available to eligible employees at least 90 days prior to the
 1519  beginning date of the election period for the employees of the
 1520  respective types of employers.
 1521         (b) Except for members initially enrolled on or after July
 1522  1, 2015, as provided in paragraph (4)(g), the education
 1523  component must provide system members with impartial and
 1524  balanced information about plan choices. The education component
 1525  must involve multimedia formats. Program comparisons must, to
 1526  the greatest extent possible, be based upon the retirement
 1527  income that different retirement programs may provide to the
 1528  member. The state board shall monitor the performance of the
 1529  contract to ensure that the program is conducted in accordance
 1530  with the contract, applicable law, and the rules of the state
 1531  board.
 1532         (c) Except for members initially enrolled on or after July
 1533  1, 2015, as provided in paragraph (4)(g), the state board, in
 1534  coordination with the department, shall provide for an initial
 1535  and ongoing transfer education component to provide system
 1536  members with information necessary to make informed plan choice
 1537  decisions. The transfer education component must include, but is
 1538  not limited to, information on:
 1539         1. The amount of money available to a member to transfer to
 1540  the defined contribution program.
 1541         2. The features of and differences between the pension plan
 1542  and the defined contribution program, both generally and
 1543  specifically, as those differences may affect the member.
 1544         3. The expected benefit available if the member were to
 1545  retire under each of the retirement programs, based on
 1546  appropriate alternative sets of assumptions.
 1547         4. The rate of return from investments in the defined
 1548  contribution program and the period of time over which such rate
 1549  of return must be achieved to equal or exceed the expected
 1550  monthly benefit payable to the member under the pension plan.
 1551         5. The historical rates of return for the investment
 1552  alternatives available in the defined contribution programs.
 1553         6. The benefits and historical rates of return on
 1554  investments available in a typical deferred compensation plan or
 1555  a typical plan under s. 403(b) of the Internal Revenue Code for
 1556  which the employee may be eligible.
 1557         7. The program choices available to employees of the State
 1558  University System and the comparative benefits of each available
 1559  program, if applicable.
 1560         8. Payout options available in each of the retirement
 1561  programs.
 1562         (h) Pursuant to subsection (8), all Florida Retirement
 1563  System employers have an obligation to regularly communicate the
 1564  existence of the two Florida Retirement System plans and the
 1565  plan choice in the natural course of administering their
 1566  personnel functions, using the educational materials supplied by
 1567  the state board and the Department of Management Services.
 1568         Section 10. Paragraph (b) of subsection (2) of section
 1569  121.591, Florida Statutes, is amended to read:
 1570         121.591 Payment of benefits.—Benefits may not be paid under
 1571  the Florida Retirement System Investment Plan unless the member
 1572  has terminated employment as provided in s. 121.021(39)(a) or is
 1573  deceased and a proper application has been filed as prescribed
 1574  by the state board or the department. Benefits, including
 1575  employee contributions, are not payable under the investment
 1576  plan for employee hardships, unforeseeable emergencies, loans,
 1577  medical expenses, educational expenses, purchase of a principal
 1578  residence, payments necessary to prevent eviction or foreclosure
 1579  on an employee’s principal residence, or any other reason except
 1580  a requested distribution for retirement, a mandatory de minimis
 1581  distribution authorized by the administrator, or a required
 1582  minimum distribution provided pursuant to the Internal Revenue
 1583  Code. The state board or department, as appropriate, may cancel
 1584  an application for retirement benefits if the member or
 1585  beneficiary fails to timely provide the information and
 1586  documents required by this chapter and the rules of the state
 1587  board and department. In accordance with their respective
 1588  responsibilities, the state board and the department shall adopt
 1589  rules establishing procedures for application for retirement
 1590  benefits and for the cancellation of such application if the
 1591  required information or documents are not received. The state
 1592  board and the department, as appropriate, are authorized to cash
 1593  out a de minimis account of a member who has been terminated
 1594  from Florida Retirement System covered employment for a minimum
 1595  of 6 calendar months. A de minimis account is an account
 1596  containing employer and employee contributions and accumulated
 1597  earnings of not more than $5,000 made under the provisions of
 1598  this chapter. Such cash-out must be a complete lump-sum
 1599  liquidation of the account balance, subject to the provisions of
 1600  the Internal Revenue Code, or a lump-sum direct rollover
 1601  distribution paid directly to the custodian of an eligible
 1602  retirement plan, as defined by the Internal Revenue Code, on
 1603  behalf of the member. Any nonvested accumulations and associated
 1604  service credit, including amounts transferred to the suspense
 1605  account of the Florida Retirement System Investment Plan Trust
 1606  Fund authorized under s. 121.4501(6), shall be forfeited upon
 1607  payment of any vested benefit to a member or beneficiary, except
 1608  for de minimis distributions or minimum required distributions
 1609  as provided under this section. If any financial instrument
 1610  issued for the payment of retirement benefits under this section
 1611  is not presented for payment within 180 days after the last day
 1612  of the month in which it was originally issued, the third-party
 1613  administrator or other duly authorized agent of the state board
 1614  shall cancel the instrument and credit the amount of the
 1615  instrument to the suspense account of the Florida Retirement
 1616  System Investment Plan Trust Fund authorized under s.
 1617  121.4501(6). Any amounts transferred to the suspense account are
 1618  payable upon a proper application, not to include earnings
 1619  thereon, as provided in this section, within 10 years after the
 1620  last day of the month in which the instrument was originally
 1621  issued, after which time such amounts and any earnings
 1622  attributable to employer contributions shall be forfeited. Any
 1623  forfeited amounts are assets of the trust fund and are not
 1624  subject to chapter 717.
 1625         (2) DISABILITY RETIREMENT BENEFITS.—Benefits provided under
 1626  this subsection are payable in lieu of the benefits that would
 1627  otherwise be payable under the provisions of subsection (1).
 1628  Such benefits must be funded from employer contributions made
 1629  under s. 121.571, transferred employee contributions and funds
 1630  accumulated pursuant to paragraph (a), and interest and earnings
 1631  thereon.
 1632         (b) Disability retirement; entitlement.—
 1633         1.a. A member of the investment plan initially enrolled
 1634  before July 1, 2015, who becomes totally and permanently
 1635  disabled, as defined in paragraph (d), after completing 8 years
 1636  of creditable service, or a member who becomes totally and
 1637  permanently disabled in the line of duty regardless of length of
 1638  service, is entitled to a monthly disability benefit.
 1639         b. A member of the investment plan initially enrolled on or
 1640  after July 1, 2015, who becomes totally and permanently
 1641  disabled, as defined in paragraph (d), after completing 10 years
 1642  of creditable service, or a member who becomes totally and
 1643  permanently disabled in the line of duty regardless of service,
 1644  is entitled to a monthly disability benefit.
 1645         2. In order for service to apply toward the 8 years of
 1646  creditable service required for regular disability benefits, or
 1647  toward the creditable service used in calculating a service
 1648  based benefit as provided under paragraph (g), the service must
 1649  be creditable service as described below:
 1650         a. The member’s period of service under the investment plan
 1651  shall be considered creditable service, except as provided in
 1652  subparagraph d.
 1653         b. If the member has elected to retain credit for service
 1654  under the pension plan as provided under s. 121.4501(3), all
 1655  such service is shall be considered creditable service.
 1656         c. If the member elects to transfer to his or her member
 1657  accounts a sum representing the present value of his or her
 1658  retirement credit under the pension plan as provided under s.
 1659  121.4501(3), the period of service under the pension plan
 1660  represented in the present value amounts transferred is shall be
 1661  considered creditable service, except as provided in
 1662  subparagraph d.
 1663         d. If a member has terminated employment and has taken
 1664  distribution of his or her funds as provided in subsection (1),
 1665  all creditable service represented by such distributed funds is
 1666  forfeited for purposes of this subsection.
 1667         Section 11. Subsection (3) of section 121.71, Florida
 1668  Statutes, is amended to read:
 1669         121.71 Uniform rates; process; calculations; levy.—
 1670         (3)(a) Required employee retirement contribution rates for
 1671  each membership class and subclass of the Florida Retirement
 1672  System for the pension plan both retirement plans are as
 1673  follows:
 1674  
 1675  Membership Class                              Percentage ofGrossCompensation,EffectiveJuly 1, 2011
 1676  
 1677  Regular Class                                         3.00%        
 1678  Special Risk Class                                    3.00%        
 1679  Special Risk Administrative Support Class             3.00%        
 1680  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders        3.00%        
 1681  Elected Officers’ Class— Justices, Judges             3.00%        
 1682  Elected Officers’ Class— County Elected Officers        3.00%        
 1683  Senior Management Service Class                       3.00%        
 1684  DROP                                                  0.00%        
 1685         (b) Required employee retirement contribution rates for
 1686  each membership class and subclass of the Florida Retirement
 1687  System for the investment plan are as follows:
 1688  
 1689  
 1690  Membership Class   Percentage ofGrossCompensation,EffectiveJuly 1, 2011Percentage ofGrossCompensation,EffectiveJuly 1, 2015
 1691  
 1692  
 1693  
 1694  
 1695  
 1696  Regular Class           3.00%          2.00%     
 1697  Special Risk Class      3.00%          2.00%     
 1698  Special Risk Administrative Support Class     3.00%          2.00%     
 1699  Elected Officers’ Class—Legislators, Governor,Lt. Governor,Cabinet Officers,State Attorneys,Public Defenders     3.00%          2.00%     
 1700  Elected Officers’ Class—Justices, Judges     3.00%          2.00%     
 1701  Elected Officers’ Class—County Elected Officers     3.00%          2.00%     
 1702  Senior Management Service Class     3.00%          2.00%     
 1703  
 1704         Section 12. Section 238.072, Florida Statutes, is amended
 1705  to read:
 1706         238.072 Special service provisions for extension
 1707  personnel.—All state and county cooperative extension personnel
 1708  holding appointments by the United States Department of
 1709  Agriculture for extension work in agriculture and home economics
 1710  in this state who are joint representatives of the University of
 1711  Florida and the United States Department of Agriculture, as
 1712  provided in s. 121.051(8) 121.051(7), who are members of the
 1713  Teachers’ Retirement System, chapter 238, and who are prohibited
 1714  from transferring to and participating in the Florida Retirement
 1715  System, chapter 121, may retire with full benefits upon
 1716  completion of 30 years of creditable service and shall be
 1717  considered to have attained normal retirement age under this
 1718  chapter, any law to the contrary notwithstanding. In order to
 1719  comply with the provisions of s. 14, Art. X of the State
 1720  Constitution, any liability accruing to the Florida Retirement
 1721  System Trust Fund as a result of the provisions of this section
 1722  shall be paid on an annual basis from the General Revenue Fund.
 1723         Section 13. Subsection (11) of section 413.051, Florida
 1724  Statutes, is amended to read:
 1725         413.051 Eligible blind persons; operation of vending
 1726  stands.—
 1727         (11) Effective July 1, 1996, blind licensees who remain
 1728  members of the Florida Retirement System pursuant to s.
 1729  121.051(7)(b)1. 121.051(6)(b)1. shall pay any unappropriated
 1730  retirement costs from their net profits or from program income.
 1731  Within 30 days after the effective date of this act, each blind
 1732  licensee who is eligible to maintain membership in the Florida
 1733  Retirement System under s. 121.051(7)(b)1. 121.051(6)(b)1., but
 1734  who elects to withdraw from the system as provided in s.
 1735  121.051(7)(b)3. 121.051(6)(b)3., must, on or before July 31,
 1736  1996, notify the Division of Blind Services and the Department
 1737  of Management Services in writing of his or her election to
 1738  withdraw. Failure to timely notify the divisions shall be deemed
 1739  a decision to remain a compulsory member of the Florida
 1740  Retirement System. However, if, at any time after July 1, 1996,
 1741  sufficient funds are not paid by a blind licensee to cover the
 1742  required contribution to the Florida Retirement System, that
 1743  blind licensee shall become ineligible to participate in the
 1744  Florida Retirement System on the last day of the first month for
 1745  which no contribution is made or the amount contributed is
 1746  insufficient to cover the required contribution. For any blind
 1747  licensee who becomes ineligible to participate in the Florida
 1748  Retirement System as described in this subsection, no creditable
 1749  service may not shall be earned under the Florida Retirement
 1750  System for any period following the month that retirement
 1751  contributions ceased to be reported. However, any such person
 1752  may participate in the Florida Retirement System in the future
 1753  if employed by a participating employer in a covered position.
 1754         Section 14. Paragraph (a) of subsection (4) of section
 1755  1012.875, Florida Statutes, is amended to read:
 1756         1012.875 State Community College System Optional Retirement
 1757  Program.—Each Florida College System institution may implement
 1758  an optional retirement program, if such program is established
 1759  therefor pursuant to s. 1001.64(20), under which annuity or
 1760  other contracts providing retirement and death benefits may be
 1761  purchased by, and on behalf of, eligible employees who
 1762  participate in the program, in accordance with s. 403(b) of the
 1763  Internal Revenue Code. Except as otherwise provided herein, this
 1764  retirement program, which shall be known as the State Community
 1765  College System Optional Retirement Program, may be implemented
 1766  and administered only by an individual Florida College System
 1767  institution or by a consortium of Florida College System
 1768  institutions.
 1769         (4)(a)1. Through June 30, 2011, each college must
 1770  contribute on behalf of each program member an amount equal to
 1771  10.43 percent of the employee’s gross monthly compensation.
 1772         2. Effective July 1, 2011, through June 30, 2012, each
 1773  member shall contribute an amount equal to the employee
 1774  contribution required under s. 121.71(3)(a). The employer shall
 1775  contribute on behalf of each program member an amount equal to
 1776  the difference between 10.43 percent of the employee’s gross
 1777  monthly compensation and the employee’s required contribution
 1778  based on the employee’s gross monthly compensation.
 1779         3. Effective July 1, 2012, each member shall contribute an
 1780  amount equal to the employee contribution required under s.
 1781  121.71(3)(a). The employer shall contribute on behalf of each
 1782  program member an amount equal to the difference between 8.15
 1783  percent of the employee’s gross monthly compensation and the
 1784  employee’s required contribution based on the employee’s gross
 1785  monthly compensation.
 1786         4. The college shall deduct an amount approved by the
 1787  district board of trustees of the college to provide for the
 1788  administration of the optional retirement program. Payment of
 1789  this contribution must be made directly by the college or
 1790  through the program administrator to the designated company
 1791  contracting for payment of benefits to the program member.
 1792         Section 15. The Legislature finds that a proper and
 1793  legitimate state purpose is served when employees and retirees
 1794  of the state and its political subdivisions, and the dependents,
 1795  survivors, and beneficiaries of such employees and retirees, are
 1796  extended the basic protections afforded by governmental
 1797  retirement systems. These persons must be provided benefits that
 1798  are fair and adequate and that are managed, administered, and
 1799  funded in an actuarially sound manner, as required by s. 14,
 1800  Article X of the State Constitution and part VII of chapter 112,
 1801  Florida Statutes. Therefore, the Legislature determines and
 1802  declares that this act fulfills an important state interest.
 1803         Section 16. This act shall take effect July 1, 2014.