Florida Senate - 2015                                    SB 7038
       
       
        
       By the Committee on Governmental Oversight and Accountability
       
       
       
       
       
       585-01924-15                                          20157038__
    1                        A bill to be entitled                      
    2         An act relating to employer contributions to fund
    3         retiree benefits; amending ss. 112.363, 121.052,
    4         121.055, and 121.071, F.S.; revising the employer
    5         contribution rates for the retiree health insurance
    6         subsidy; amending s. 121.71, F.S.; revising the
    7         required employer retirement contribution rates for
    8         members of each membership class and subclass of the
    9         Florida Retirement System; providing findings of an
   10         important state interest; providing an effective date.
   11          
   12  Be It Enacted by the Legislature of the State of Florida:
   13  
   14         Section 1. Paragraph (i) is added to subsection (8) of
   15  section 112.363, Florida Statutes, to read:
   16         112.363 Retiree health insurance subsidy.—
   17         (8) CONTRIBUTIONS.—For purposes of funding the insurance
   18  subsidy provided by this section:
   19         (i) Beginning July 1, 2015, the employer of each member of
   20  a state-administered retirement plan shall contribute 1.58
   21  percent of gross compensation each pay period.
   22  
   23  Such contributions shall be submitted to the Department of
   24  Management Services and deposited in the Retiree Health
   25  Insurance Subsidy Trust Fund.
   26         Section 2. Paragraph (d) of subsection (7) of section
   27  121.052, Florida Statutes, is amended to read:
   28         121.052 Membership class of elected officers.—
   29         (7) CONTRIBUTIONS.—
   30         (d) The following table states the required employer
   31  contribution on behalf of each member of the Elected Officers’
   32  Class in terms of a percentage of the member’s gross
   33  compensation. Such contribution constitutes the entire health
   34  insurance subsidy contribution with respect to each such member.
   35  A change in the contribution rate is effective with the first
   36  salary paid on or after the beginning date of the change. The
   37  retiree health insurance subsidy contribution rate is as
   38  follows:
   39  
   40  Dates of Contribution Rate Changes        ContributionRate         
   41  October 1, 1987, through December 31, 1988              0.24%              
   42  January 1, 1989, through December 31, 1993              0.48%              
   43  January 1, 1994, through December 31, 1994              0.56%              
   44  January 1, 1995, through June 30, 1998              0.66%              
   45  July 1, 1998, through June 30, 2001              0.94%              
   46  July 1, 2001, through June 30, 2013              1.11%              
   47  July 1, 2013, through June 30, 2014              1.20%              
   48  Effective July 1, 2014, through June 30, 2015              1.26%              
   49  Effective July 1, 2015                         1.58%              
   50  Such contributions and accompanying payroll data are due and
   51  payable no later than the 5th working day of the month
   52  immediately following the month during which the payroll period
   53  ended and shall be deposited by the administrator in the Retiree
   54  Health Insurance Subsidy Trust Fund.
   55         Section 3. Paragraph (d) of subsection (3) of section
   56  121.055, Florida Statutes, is amended to read:
   57         121.055 Senior Management Service Class.—There is hereby
   58  established a separate class of membership within the Florida
   59  Retirement System to be known as the “Senior Management Service
   60  Class,” which shall become effective February 1, 1987.
   61         (3)
   62         (d) The following table states the required employer
   63  contribution on behalf of each member of the Senior Management
   64  Service Class in terms of a percentage of the member’s gross
   65  compensation. Such contribution constitutes the entire health
   66  insurance subsidy contribution with respect to each such member.
   67  A change in the contribution rate is effective with the first
   68  salary paid on or after the beginning date of the change. The
   69  retiree health insurance subsidy contribution rate is as
   70  follows:
   71  
   72  Dates of Contribution Rate Changes        ContributionRate         
   73  October 1, 1987, through December 31, 1988              0.24%              
   74  January 1, 1989, through December 31, 1993              0.48%              
   75  January 1, 1994, through December 31, 1994              0.56%              
   76  January 1, 1995, through June 30, 1998              0.66%              
   77  July 1, 1998, through June 30, 2001              0.94%              
   78  July 1, 2001, through June 30, 2013              1.11%              
   79  July 1, 2013, through June 30, 2014              1.20%              
   80  Effective July 1, 2014, through June 30, 2015              1.26%              
   81  Effective July 1, 2015                         1.58%              
   82  Such contributions and accompanying payroll data are due and
   83  payable no later than the 5th working day of the month
   84  immediately following the month during which the payroll period
   85  ended and shall be deposited by the administrator in the Retiree
   86  Health Insurance Subsidy Trust Fund.
   87         Section 4. Subsection (4) of section 121.071, Florida
   88  Statutes, is amended to read:
   89         121.071 Contributions.—Contributions to the system shall be
   90  made as follows:
   91         (4) The following table states the required employer
   92  contribution on behalf of each member of the Regular Class,
   93  Special Risk Class, or Special Risk Administrative Support Class
   94  in terms of a percentage of the member’s gross compensation.
   95  Such contribution constitutes the entire health insurance
   96  subsidy contribution with respect to each such member. A change
   97  in the contribution rate is effective with the first salary paid
   98  on or after the beginning date of the change. The retiree health
   99  insurance subsidy contribution rate is as follows:
  100  
  101  Dates of Contribution Rate Changes        ContributionRate         
  102  October 1, 1987, through December 31, 1988              0.24%              
  103  January 1, 1989, through December 31, 1993              0.48%              
  104  January 1, 1994, through December 31, 1994              0.56%              
  105  January 1, 1995, through June 30, 1998              0.66%              
  106  July 1, 1998, through June 30, 2001              0.94%              
  107  July 1, 2001, through June 30, 2013              1.11%              
  108  July 1, 2013, through June 30, 2014              1.20%              
  109  Effective July 1, 2014, through June 30, 2015              1.26%              
  110  Effective July 1, 2015                         1.58%              
  111  Such contributions shall be deposited by the administrator in
  112  the Retiree Health Insurance Subsidy Trust Fund.
  113         Section 5. Subsections (4) and (5) of section 121.71,
  114  Florida Statutes, are amended to read:
  115         121.71 Uniform rates; process; calculations; levy.—
  116         (4) Required employer retirement contribution rates for
  117  each membership class and subclass of the Florida Retirement
  118  System for both retirement plans are as follows:
  119  
  120  Membership Class            Percentage ofGrossCompensation,EffectiveJuly 1, 2015 2014
  121  Regular Class                             2.91% 3.53%              
  122  Special Risk Class                       11.35% 11.01%             
  123  Special Risk Administrative Support Class              3.71% 4.18%              
  124  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders              6.48% 6.30%              
  125  Elected Officers’ Class— Justices, Judges             11.39% 10.10%             
  126  Elected Officers’ Class— County Elected Officers              8.48% 8.36%              
  127  Senior Management Class                   4.32% 4.80%              
  128  DROP                                      4.10% 4.30%              
  129         (5) In order to address unfunded actuarial liabilities of
  130  the system, the required employer retirement contribution rates
  131  for each membership class and subclass of the Florida Retirement
  132  System for both retirement plans are as follows:
  133  
  134  
  135  Membership Class            Percentage ofGrossCompensation,EffectiveJuly 1, 2015 2014
  136  Regular Class                             2.65% 2.54%              
  137  Special Risk Class                        8.99% 7.51%              
  138  Special Risk Administrative Support Class             27.54% 36.59%             
  139  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders             37.62% 38.66%             
  140  Elected Officers’ Class— Justices, Judges             22.62% 21.77%             
  141  Elected Officers’ Class— County Elected Officers             32.09% 33.58%             
  142  Senior Management Service Class             15.41% 15.04%             
  143  DROP                                      7.12% 6.72%              
  144         Section 6. The Legislature finds that a proper and
  145  legitimate state purpose is served when employees, officers, and
  146  retirees of the state and its political subdivisions, and the
  147  dependents, survivors, and beneficiaries of such employees,
  148  officers, and retirees, are extended the basic protections
  149  afforded by governmental retirement systems. These persons must
  150  be provided benefits that are fair and adequate and that are
  151  managed, administered, and funded in an actuarially sound
  152  manner, as required by s. 14, Article X of the State
  153  Constitution and part VII of chapter 112, Florida Statutes.
  154  Therefore, the Legislature determines and declares that this act
  155  fulfills an important state interest.
  156         Section 7. The Legislature finds that a proper and
  157  legitimate state purpose is served when employees, officers, and
  158  retirees of the state and of its political subdivisions, and the
  159  dependents, survivors, and beneficiaries of such employees,
  160  officers, and retirees, are extended the basic protections
  161  afforded by governmental retirement systems that provide fair
  162  and adequate benefits, including health insurance subsidies, and
  163  that are managed, administered, and funded in a reasonable
  164  manner. Therefore, the Legislature determines and declares that
  165  this act fulfills an important state interest.
  166         Section 8. This act shall take effect July 1, 2015.