Florida Senate - 2025                   (PROPOSED BILL) SPB 7022
       
       
        
       FOR CONSIDERATION By the Committee on Governmental Oversight and
       Accountability
       
       
       
       
       585-01063A-25                                         20257022pb
    1                        A bill to be entitled                      
    2         An act relating to employer contributions to fund
    3         retiree benefits; amending s. 121.053, F.S.;
    4         authorizing an officer, except while serving as a
    5         legislator, to remain in elective office and receive
    6         accumulated DROP proceeds after the officer attains a
    7         certain age; providing that, upon termination, the
    8         officer receives accumulated DROP proceeds including
    9         interest earned in accordance with a specified
   10         provision; amending s. 121.091, F.S.; requiring the
   11         Division of Retirement or the State Board of
   12         Administration, as appropriate, to take steps to
   13         recoup from the elected officer any DROP proceeds
   14         distributed in accordance with a specified provision,
   15         under specified circumstances; amending s. 121.71,
   16         F.S.; revising required employer retirement
   17         contribution rates for each membership class and
   18         subclass of the Florida Retirement System; providing a
   19         declaration of important state interest; providing an
   20         effective date.
   21          
   22  Be It Enacted by the Legislature of the State of Florida:
   23  
   24         Section 1. Subsection (7) of section 121.053, Florida
   25  Statutes, is amended to read:
   26         121.053 Participation in the Elected Officers’ Class for
   27  retired members.—
   28         (7) A member who is elected or appointed to an elective
   29  office and who is participating in the Deferred Retirement
   30  Option Program is not subject to termination as defined in s.
   31  121.021, or reemployment limitations as provided in s.
   32  121.091(9), until the end of his or her current term of office
   33  or, if the officer is consecutively elected or reelected to an
   34  elective office eligible for coverage under the Florida
   35  Retirement System, until he or she no longer holds an elective
   36  office, as follows:
   37         (a) At the end of the member’s DROP period:
   38         1. The officer’s DROP account may not accrue additional
   39  monthly benefits, but does continue to earn interest as provided
   40  in s. 121.091(13). However, an officer whose DROP participation
   41  begins on or after July 1, 2010, may not continue to earn such
   42  interest.
   43         2. Retirement contributions, except for unfunded actuarial
   44  liability and health insurance subsidy contributions required in
   45  ss. 121.71(5) and 121.76, are not required of the employer of
   46  the elected officer, and additional retirement credit may not be
   47  earned under the Florida Retirement System.
   48         3.The officer, except while serving as a legislator, may
   49  remain in elective office and receive his or her accumulated
   50  DROP proceeds, including interest earned in accordance with
   51  subparagraph 1., after attaining the age of 59 1/2 years.
   52         (b) An elected officer may voluntarily terminate his or her
   53  elective office at any time and receive his or her DROP
   54  proceeds. However, until termination occurs, an elected officer
   55  whose termination limitations are extended by this section is
   56  ineligible for renewed membership in the system and may not
   57  receive pension payments, DROP lump sum payments, or any other
   58  state payment other than the statutorily determined salary,
   59  travel, and per diem for the elective office.
   60         (c) Upon termination, the officer shall receive his or her
   61  accumulated DROP account, including plus interest earned in
   62  accordance with subparagraph (a)1., and shall accrue and
   63  commence receiving monthly retirement benefits, which must be
   64  paid on a prospective basis only.
   65         Section 2. Subsection (5) of section 121.091, Florida
   66  Statutes, is amended to read:
   67         121.091 Benefits payable under the system.—Benefits may not
   68  be paid under this section unless the member has terminated
   69  employment as provided in s. 121.021(39)(a) or begun
   70  participation in the Deferred Retirement Option Program as
   71  provided in subsection (13), and a proper application has been
   72  filed in the manner prescribed by the department. The department
   73  may cancel an application for retirement benefits when the
   74  member or beneficiary fails to timely provide the information
   75  and documents required by this chapter and the department’s
   76  rules. The department shall adopt rules establishing procedures
   77  for application for retirement benefits and for the cancellation
   78  of such application when the required information or documents
   79  are not received.
   80         (5) TERMINATION BENEFITS.—A member whose employment is
   81  terminated prior to retirement retains membership rights to
   82  previously earned member-noncontributory service credit, and to
   83  member-contributory service credit, if the member leaves the
   84  member contributions on deposit in his or her retirement
   85  account. If a terminated member receives a refund of member
   86  contributions, such member may reinstate membership rights to
   87  the previously earned service credit represented by the refund
   88  by completing 1 year of creditable service and repaying the
   89  refunded member contributions, plus interest.
   90         (a) A member whose employment is terminated for any reason
   91  other than death or retirement before becoming vested is
   92  entitled to the return of his or her accumulated contributions
   93  as of the date of termination. Effective July 1, 2011, upon
   94  termination of employment from all participating employers for 3
   95  calendar months as defined in s. 121.021(39)(c) for any reason
   96  other than retirement, a member may receive a refund of all
   97  contributions he or she has made to the pension plan, subject to
   98  the restrictions otherwise provided in this chapter. The refund
   99  may be received as a lump-sum payment, a rollover to a qualified
  100  plan, or a combination of these methods. Partial refunds are not
  101  permitted. The refund may not include any interest earnings on
  102  the contributions for a member of the pension plan. Employer
  103  contributions made on behalf of the member are not refundable. A
  104  member may not receive a refund of employee contributions if a
  105  pending or an approved qualified domestic relations order is
  106  filed against his or her retirement account. By obtaining a
  107  refund of contributions, a member waives all rights under the
  108  Florida Retirement System and the health insurance subsidy to
  109  the service credit represented by the refunded contributions,
  110  except the right to purchase his or her prior service credit in
  111  accordance with s. 121.081(2).
  112         (b) A member whose employment is terminated for any reason
  113  other than death or retirement after becoming vested may elect
  114  to receive a deferred monthly benefit which shall begin to
  115  accrue on the first day of the month of normal or early
  116  retirement and shall be payable on the last day of that month
  117  and each month thereafter during his or her lifetime. The amount
  118  of monthly benefit shall be computed in the same manner as for a
  119  normal retirement benefit in accordance with subsection (1) or
  120  early retirement benefit in accordance with s. 121.021(30), but
  121  based on average monthly compensation and creditable service as
  122  of the date of termination.
  123         (c) In lieu of the deferred monthly benefit provided in
  124  paragraph (b), the terminated member may elect to receive a
  125  lump-sum amount equal to his or her accumulated contributions as
  126  of the date of termination. Effective July 1, 2011, upon
  127  termination of employment from all participating employers for 3
  128  calendar months as defined in s. 121.021(39)(c) for any reason
  129  other than retirement, a member may receive a refund of all
  130  contributions he or she has made to the pension plan, subject to
  131  the restrictions otherwise provided in this chapter. Partial
  132  refunds are not permitted. The refund may not include any
  133  interest earnings on the contributions for a member of the
  134  pension plan. Employer contributions made on behalf of the
  135  member are not refundable. A member may not receive a refund of
  136  employee contributions if a pending or an approved qualified
  137  domestic relations order is filed against his or her retirement
  138  account. By obtaining a refund of contributions, a member waives
  139  all rights under the Florida Retirement System and the health
  140  insurance subsidy to the service credit represented by the
  141  refunded contributions, except the right to purchase his or her
  142  prior service credit in accordance with s. 121.081(2).
  143         (d) If any retired member dies without having received in
  144  benefit payments an amount equal to his or her accumulated
  145  contributions, there shall be payable to his or her designated
  146  beneficiary an amount equal to the excess, if any, of the
  147  member’s accumulated contributions over the total monthly
  148  payments made to the member prior to the date of death.
  149         (e) A member shall be deemed a terminated member when
  150  termination of employment has occurred as provided in s.
  151  121.021(39).
  152         (f) Any member who has been found guilty by a verdict of a
  153  jury, or by the court trying the case without a jury, of
  154  committing, aiding, or abetting any embezzlement or theft from
  155  his or her employer, bribery in connection with the employment,
  156  or other felony specified in chapter 838, except ss. 838.15 and
  157  838.16, committed prior to retirement, or who has entered a plea
  158  of guilty or of nolo contendere to such crime, or any member
  159  whose employment is terminated by reason of the member’s
  160  admitted commitment, aiding, or abetting of an embezzlement or
  161  theft from his or her employer, bribery, or other felony
  162  specified in chapter 838, except ss. 838.15 and 838.16, shall
  163  forfeit all rights and benefits under this chapter, except the
  164  return of his or her accumulated contributions as of the date of
  165  termination.
  166         (g) Any elected official who is convicted by the Senate of
  167  an impeachable offense shall forfeit all rights and benefits
  168  under this chapter, except the return of his or her accumulated
  169  contributions as of the date of the conviction.
  170         (h) Any member who, prior to retirement, is adjudged by a
  171  court of competent jurisdiction to have violated any state law
  172  against strikes by public employees, or who has been found
  173  guilty by such court of violating any state law prohibiting
  174  strikes by public employees, shall forfeit all rights and
  175  benefits under this chapter, except the return of his or her
  176  accumulated contributions as of the date of the conviction.
  177         (i) The division or the state board may not pay benefits to
  178  any member convicted of a felony committed on or after October
  179  1, 2008, defined in s. 800.04 against a victim younger than 16
  180  years of age, or defined in chapter 794 against a victim younger
  181  than 18 years of age, through the use or attempted use of power,
  182  rights, privileges, duties, or position of the member’s public
  183  office or employment position. However, the division or the
  184  state board shall return the member’s accumulated contributions,
  185  if any, that the member accumulated as of the date of
  186  conviction.
  187         (j) Any beneficiary who by a verdict of a jury or by the
  188  court trying the case without a jury is found guilty, or who has
  189  entered a plea of guilty or nolo contendere, of unlawfully and
  190  intentionally killing or procuring the death of the member
  191  forfeits all rights to the deceased member’s benefits under this
  192  chapter, and the benefits will be paid as if such beneficiary
  193  had predeceased the decedent.
  194         (k) Benefits may not be paid by the division or the state
  195  board pending final resolution of such charges against a member
  196  or beneficiary if the resolution of such charges could require
  197  the forfeiture of benefits as provided in paragraph (f),
  198  paragraph (g), paragraph (h), paragraph (i), paragraph (j), or
  199  chapter 112.
  200         (l)The division and the state board, as appropriate, must
  201  take steps to recoup from the elected officer any DROP proceeds
  202  distributed pursuant to s. 121.053(7)(a)3. if:
  203         1.Such DROP proceeds were distributed before the elected
  204  officer’s termination; and
  205         2.The division or state board would be prohibited pursuant
  206  to paragraph (k) from making a distribution to the elected
  207  officer, absent the distribution to the elected officer pursuant
  208  to s. 121.053(7)(a)3.
  209         Section 3. Subsections (4) and (5) of section 121.71,
  210  Florida Statutes, are amended to read:
  211         121.71 Uniform rates; process; calculations; levy.—
  212         (4) Required employer retirement contribution rates for
  213  each membership class and subclass of the Florida Retirement
  214  System for both retirement plans are as follows:
  215  
  216  Membership Class            Percentage ofGrossCompensation,EffectiveJuly 1, 2025 2024
  217  
  218  Regular Class                             7.10% 6.73%              
  219  Special Risk Class                       20.10% 18.66%             
  220  Special Risk Administrative Support Class             10.88% 11.54%             
  221  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders             10.04% 10.70%             
  222  Elected Officers’ Class— Justices, Judges             15.62% 14.90%             
  223  Elected Officers’ Class— County Elected Officers             11.79% 12.39%             
  224  Senior Management Service Class             8.73% 8.56%               
  225  DROP                                      9.37% 8.49%              
  226         (5) In order to address unfunded actuarial liabilities of
  227  the system, the required employer retirement contribution rates
  228  for each membership class and subclass of the Florida Retirement
  229  System for both retirement plans are as follows:
  230  
  231  Membership Class            Percentage ofGrossCompensation,EffectiveJuly 1, 2025 2024
  232  
  233  Regular Class                             4.87% 4.84%              
  234  Special Risk Class                       13.03% 12.07%             
  235  Special Risk Administrative Support Class             26.54% 26.22%             
  236  Elected Officers’ Class— Legislators, Governor, Lt. Governor, Cabinet Officers, State Attorneys, Public Defenders             50.56% 50.21%             
  237  Elected Officers’ Class— Justices, Judges             28.46% 28.49%             
  238  Elected Officers’ Class— County Elected Officers             40.72% 44.23%             
  239  Senior Management Service Class             22.45% 23.90%             
  240  DROP                                     10.65% 10.64%             
  241         Section 4. The Legislature finds that a proper and
  242  legitimate state purpose is served when employees, officers, and
  243  retirees of the state and its political subdivisions, and the
  244  dependents, survivors, and beneficiaries of such employees,
  245  officers, and retirees, are extended the basic protections
  246  afforded by governmental retirement systems. These persons must
  247  be provided benefits that are fair and adequate and that are
  248  managed, administered, and funded in an actuarially sound manner
  249  as required by s. 14, Article X of the State Constitution and
  250  part VII of chapter 112, Florida Statutes. Therefore, the
  251  Legislature determines and declares that this act fulfills an
  252  important state interest.
  253         Section 5. This act shall take effect July 1, 2025.