Florida Senate - 2015 COMMITTEE AMENDMENT Bill No. CS for SB 838 Ì851236%Î851236 LEGISLATIVE ACTION Senate . House Comm: RS . 03/31/2015 . . . . ————————————————————————————————————————————————————————————————— ————————————————————————————————————————————————————————————————— The Committee on Governmental Oversight and Accountability (Latvala) recommended the following: 1 Senate Amendment (with title amendment) 2 3 Delete lines 68 - 304 4 and insert: 5 (d) Effective July 1, 2015, “termination” for a retired 6 justice or retired judge who returns to temporary employment for 7 compensation as a senior judge in any court, as assigned by the 8 Chief Justice of the Supreme Court in accordance with s. 2, Art. 9 V of the State Constitution, occurs when he or she: 10 1. Has reached the later of his or her normal retirement 11 age or the age when vested; and 12 2. Has terminated all employment relationships with 13 employers under the Florida Retirement System for at least 3 14 calendar months before applying for and returning to such 15 temporary employment. 16 Section 2. Paragraphs (c), (d), and (e) of subsection (9) 17 of section 121.091, Florida Statutes, are amended, and paragraph 18 (f) is added to that subsection, to read: 19 121.091 Benefits payable under the system.—Benefits may not 20 be paid under this section unless the member has terminated 21 employment as provided in s. 121.021(39)(a) or begun 22 participation in the Deferred Retirement Option Program as 23 provided in subsection (13), and a proper application has been 24 filed in the manner prescribed by the department. The department 25 may cancel an application for retirement benefits when the 26 member or beneficiary fails to timely provide the information 27 and documents required by this chapter and the department’s 28 rules. The department shall adopt rules establishing procedures 29 for application for retirement benefits and for the cancellation 30 of such application when the required information or documents 31 are not received. 32 (9) EMPLOYMENT AFTER RETIREMENT; LIMITATION.— 33 (c) Any person whose retirement is effective on or after 34 July 1, 2010, or whose participation in the Deferred Retirement 35 Option Program terminates on or after July 1, 2010, who is 36 retired under this chapter, except under the disability 37 retirement provisions of subsection (4) or as provided in s. 38 121.053, may be reemployed by an employer that participates in a 39 state-administered retirement system and receive retirement 40 benefits and compensation from that employer. However, a person 41 may not be reemployed by an employer participating in the 42 Florida Retirement System before meeting the definition of 43 termination in s. 121.021 and may not receive both a salary from 44 the employer and retirement benefits for 6 calendar months after 45 meeting the definition of termination, except as provided in 46 paragraph (f). However, a DROP participant shall continue 47 employment and receive a salary during the period of 48 participation in the Deferred Retirement Option Program, as 49 provided in subsection (13). 50 1. The reemployed retiree may not renew membership in the 51 Florida Retirement System. 52 2. The employer shall pay retirement contributions in an 53 amount equal to the unfunded actuarial liability portion of the 54 employer contribution that would be required for active members 55 of the Florida Retirement System in addition to the 56 contributions required by s. 121.76. 57 3. A retiree initially reemployed in violation of this 58 paragraph and an employer that employs or appoints such person 59 are jointly and severally liable for reimbursement of any 60 retirement benefits paid to the retirement trust fund from which 61 the benefits were paid, including the Florida Retirement System 62 Trust Fund and the Public Employee Optional Retirement Program 63 Trust Fund, as appropriate. The employer must have a written 64 statement from the employee that he or she is not retired from a 65 state-administered retirement system. Retirement benefits shall 66 remain suspended until repayment is made. Benefits suspended 67 beyond the end of the retiree’s 6-month reemployment limitation 68 period shall apply toward the repayment of benefits received in 69 violation of this paragraph. 70 (d) Except as provided in paragraph (f), this subsection 71 applies to retirees, as defined in s. 121.4501(2), of the 72 Florida Retirement System Investment Plan, subject to the 73 following conditions: 74 1. A retiree may not be reemployed with an employer 75 participating in the Florida Retirement System until such person 76 has been retired for 6 calendar months. 77 2. A retiree employed in violation of this subsection and 78 an employer that employs or appoints such person are jointly and 79 severally liable for reimbursement of any benefits paid to the 80 retirement trust fund from which the benefits were paid. The 81 employer must have a written statement from the retiree that he 82 or she is not retired from a state-administered retirement 83 system. 84 (e) The limitations of this subsection apply to 85 reemployment in any capacity irrespective of the category of 86 funds from which the person is compensated, except as provided 87 in paragraph (f). 88 (f) Effective July 1, 2015, a retired justice or retired 89 judge who has reached the later of his or her normal retirement 90 age or the age when vested, who has terminated all employment 91 with employers participating under the Florida Retirement System 92 for at least 3 calendar months, and who subsequently applies for 93 and returns to temporary employment for compensation as a senior 94 judge in any court, as assigned by the Chief Justice of the 95 Supreme Court in accordance with s. 2, Art. V of the State 96 Constitution, is not subject to paragraph (c), paragraph (d), or 97 paragraph (e) while reemployed as a senior judge. 98 Section 3. Paragraph (a) of subsection (1) of section 99 121.591, Florida Statutes, is amended to read: 100 121.591 Payment of benefits.—Benefits may not be paid under 101 the Florida Retirement System Investment Plan unless the member 102 has terminated employment as provided in s. 121.021(39)(a) or is 103 deceased and a proper application has been filed as prescribed 104 by the state board or the department. Benefits, including 105 employee contributions, are not payable under the investment 106 plan for employee hardships, unforeseeable emergencies, loans, 107 medical expenses, educational expenses, purchase of a principal 108 residence, payments necessary to prevent eviction or foreclosure 109 on an employee’s principal residence, or any other reason except 110 a requested distribution for retirement, a mandatory de minimis 111 distribution authorized by the administrator, or a required 112 minimum distribution provided pursuant to the Internal Revenue 113 Code. The state board or department, as appropriate, may cancel 114 an application for retirement benefits if the member or 115 beneficiary fails to timely provide the information and 116 documents required by this chapter and the rules of the state 117 board and department. In accordance with their respective 118 responsibilities, the state board and the department shall adopt 119 rules establishing procedures for application for retirement 120 benefits and for the cancellation of such application if the 121 required information or documents are not received. The state 122 board and the department, as appropriate, are authorized to cash 123 out a de minimis account of a member who has been terminated 124 from Florida Retirement System covered employment for a minimum 125 of 6 calendar months. A de minimis account is an account 126 containing employer and employee contributions and accumulated 127 earnings of not more than $5,000 made under the provisions of 128 this chapter. Such cash-out must be a complete lump-sum 129 liquidation of the account balance, subject to the provisions of 130 the Internal Revenue Code, or a lump-sum direct rollover 131 distribution paid directly to the custodian of an eligible 132 retirement plan, as defined by the Internal Revenue Code, on 133 behalf of the member. Any nonvested accumulations and associated 134 service credit, including amounts transferred to the suspense 135 account of the Florida Retirement System Investment Plan Trust 136 Fund authorized under s. 121.4501(6), shall be forfeited upon 137 payment of any vested benefit to a member or beneficiary, except 138 for de minimis distributions or minimum required distributions 139 as provided under this section. If any financial instrument 140 issued for the payment of retirement benefits under this section 141 is not presented for payment within 180 days after the last day 142 of the month in which it was originally issued, the third-party 143 administrator or other duly authorized agent of the state board 144 shall cancel the instrument and credit the amount of the 145 instrument to the suspense account of the Florida Retirement 146 System Investment Plan Trust Fund authorized under s. 147 121.4501(6). Any amounts transferred to the suspense account are 148 payable upon a proper application, not to include earnings 149 thereon, as provided in this section, within 10 years after the 150 last day of the month in which the instrument was originally 151 issued, after which time such amounts and any earnings 152 attributable to employer contributions shall be forfeited. Any 153 forfeited amounts are assets of the trust fund and are not 154 subject to chapter 717. 155 (1) NORMAL BENEFITS.—Under the investment plan: 156 (a) Benefits in the form of vested accumulations as 157 described in s. 121.4501(6) are payable under this subsection in 158 accordance with the following terms and conditions: 159 1. Benefits are payable only to a member, an alternate 160 payee of a qualified domestic relations order, or a beneficiary. 161 2. Benefits shall be paid by the third-party administrator 162 or designated approved providers in accordance with the law, the 163 contracts, and any applicable board rule or policy. 164 3. The member must be terminated from all employment with 165 all Florida Retirement System employers, as provided in s. 166 121.021(39). 167 4. Benefit payments may not be made until the member has 168 been terminated for 3 calendar months, except that the state 169 board may authorize by rule for the distribution of up to 10 170 percent of the member’s account after being terminated for 1 171 calendar month if the member has reached the normal retirement 172 date as defined in s. 121.021. Effective July 1, 2015, a retired 173 justice or retired judge who returns to temporary employment as 174 a senior judge in any court pursuant to s. 2, Art. V of the 175 State Constitution and meets the criteria in the definition of 176 the term “termination” in s. 121.021(39)(d) may continue to 177 receive a distribution of his or her account as provided under 178 this paragraph after providing proof of assignment as a senior 179 judge. 180 5. If a member or former member of the Florida Retirement 181 System receives an invalid distribution, such person must either 182 repay the full amount within 90 days after receipt of final 183 notification by the state board or the third-party administrator 184 that the distribution was invalid, or, in lieu of repayment, the 185 member must terminate employment from all participating 186 employers. If such person fails to repay the full invalid 187 distribution within 90 days after receipt of final notification, 188 the person may be deemed retired from the investment plan by the 189 state board and is subject to s. 121.122. If such person is 190 deemed retired, any joint and several liability set out in s. 191 121.091(9)(d)2. is void, and the state board, the department, or 192 the employing agency is not liable for gains on payroll 193 contributions that have not been deposited to the person’s 194 account in the investment plan, pending resolution of the 195 invalid distribution. The member or former member who has been 196 deemed retired or who has been determined by the state board to 197 have taken an invalid distribution may appeal the agency 198 decision through the complaint process as provided under s. 199 121.4501(9)(g)3. As used in this subparagraph, the term “invalid 200 distribution” means any distribution from an account in the 201 investment plan which is taken in violation of this section, s. 202 121.091(9), or s. 121.4501. 203 Section 4. (1) In order to fund the benefit changes 204 provided in this act, the required employer contribution rates 205 for members of the Florida Retirement System established in s. 206 121.71(4), Florida Statutes, must be adjusted as follows: 207 (a) The Elected Officers’ Class for Justices and Judges 208 must be increased by 0.45 percentage point; and 209 (b) The Deferred Retirement Option Program must be 210 increased by 0.01 percentage point. 211 (2) In order to fund the benefit changes provided in this 212 act, the required employer contribution rate for the unfunded 213 actuarial liability of the Florida Retirement System established 214 in s. 121.71(5), Florida Statutes, for the Elected Officers’ 215 Class for Justices and Judges is increased by 0.91 percentage 216 point. 217 (3) The adjustments provided in subsections (1) and (2) 218 shall be in addition to all other changes to such contribution 219 rates which may be enacted into law to take effect on July 1, 220 2015, and July 1, 2016. The Division of Law Revision and 221 Information is directed to adjust accordingly the contribution 222 rates provided in s. 121.71, Florida Statutes. 223 Section 5. (1) The Legislature finds that a proper and 224 legitimate state purpose is served if employees and retirees of 225 the state and its political subdivisions, and the dependents, 226 survivors, and beneficiaries of such employees and retirees, are 227 extended the basic protections afforded by governmental 228 retirement systems which provide fair and adequate benefits and 229 which are managed, administered, and funded in an actuarially 230 sound manner as required by s. 14, Article X of the State 231 Constitution and part VII of chapter 112, Florida Statutes. 232 Therefore, the Legislature determines and declares that this act 233 fulfills an important state interest. 234 (2) The Legislature further finds that the assignments of 235 former justices and judges to temporary employment as senior 236 judges in any court by the Chief Justice of the Supreme Court in 237 accordance with s. 2, Article V of the State Constitution assist 238 the state courts system in managing caseloads and providing 239 individuals and businesses with access to courts. Therefore, the 240 Legislature further determines and declares that this act 241 fulfills an important state interest by facilitating the ability 242 of justices and judges who retire under the Florida Retirement 243 System in a bona fide termination to return to temporary 244 employment as senior judges in a timely manner. 245 246 ================= T I T L E A M E N D M E N T ================ 247 And the title is amended as follows: 248 Delete line 9 249 and insert: 250 retired judge who applies for and returns to temporary 251 employment for compensation as a