January 19, 2020
Print This PagePrint This Page

  *
Session:
Bill #:
Session:
Chamber: View Search Tips
Search Term:
Year: View Search Tips
Search Term:
HB 1271CS

CHAMBER ACTION




1The Committee on State Administration recommends the following:
2
3     Committee Substitute
4     Remove the entire bill and insert:
5
A bill to be entitled
6An act relating to state financial matters; amending s.
7112.363, F.S.; specifying spouse at time of death as
8beneficiary for purposes of the retiree health insurance
9subsidy; providing an exception; amending s. 121.4501,
10F.S., relating to the Public Employee Optional Retirement
11Program; providing a definition; providing deadlines for
12certain employees for election and removal from the
13optional retirement program; requiring an employer to
14communicate retirement options to employees; authorizing
15certain employees to change retirement plans under certain
16circumstances; amending s. 121.591, F.S., relating to
17benefits payable under the optional retirement program;
18authorizing the State Board of Administration and the
19Department of Management Services to cash out certain
20accounts under certain circumstances; removing the ability
21of a deceased disabled retiree's beneficiary to receive
22certain trust fund account balances; amending s. 121.78,
23F.S.; revising criteria for certain employer
24contributions; requiring certain participants to repay
25excess employer contributions under certain circumstances;
26amending s. 215.47, F.S.; providing that expenditures for
27acquisition and operation of investments in private equity
28or other private investment partnerships or limited
29liability companies shall be included in the cost of the
30investment; providing criteria for certain fixed income
31obligations for investments; deleting a provision allowing
32certain general foreign government-backed investments;
33amending s. 215.475, F.S.; providing for a Florida
34Retirement System Defined Benefit Plan Investment Policy
35Statement instead of a plan; revising provisions to
36conform; amending s. 215.5601, F.S., to conform; providing
37an effective date.
38
39Be It Enacted by the Legislature of the State of Florida:
40
41     Section 1.  Paragraph (e) of subsection (3) of section
42112.363, Florida Statutes, is amended to read:
43     112.363  Retiree health insurance subsidy.--
44     (3)  RETIREE HEALTH INSURANCE SUBSIDY AMOUNT.--
45     (e)1.  Beginning July 1, 2001, each eligible retiree of the
46defined benefit program of the Florida Retirement System, or, if
47the retiree is deceased, his or her beneficiary who is receiving
48a monthly benefit from such retiree's account and who is a
49spouse, or a person who meets the definition of joint annuitant
50in s. 121.021(28), shall receive a monthly retiree health
51insurance subsidy payment equal to the number of years of
52creditable service, as defined in s. 121.021(17), completed at
53the time of retirement multiplied by $5; however, no eligible
54retiree or beneficiary may receive a subsidy payment of more
55than $150 or less than $30. If there are multiple beneficiaries,
56the total payment must not be greater than the payment to which
57the retiree was entitled. The health insurance subsidy amount
58payable to any person receiving the retiree health insurance
59subsidy payment on July 1, 2001, shall not be reduced solely by
60operation of this subparagraph.
61     2.  Beginning July 1, 2002, each eligible participant of
62the Public Employee Optional Retirement Program of the Florida
63Retirement System who has met the requirements of this section,
64or, if the participant is deceased, his or her spouse who is the
65participant's designated beneficiary, shall receive a monthly
66retiree health insurance subsidy payment equal to the number of
67years of creditable service, as provided in this subparagraph,
68completed at the time of retirement, multiplied by $5; however,
69no eligible retiree or beneficiary may receive a subsidy payment
70of more than $150 or less than $30. For purposes of determining
71a participant's creditable service used to calculate the health
72insurance subsidy, a participant's years of service credit or
73fraction thereof shall be based on the participant's work year
74as defined in s. 121.021(54). Credit shall be awarded for a full
75work year whenever health insurance subsidy contributions have
76been made as required by law for each month in the participant's
77work year. In addition, all years of creditable service retained
78under the Florida Retirement System defined benefit program
79shall be included as creditable service for purposes of this
80section. Notwithstanding any other provisions of this section,
81the participant's spouse at the time of the participant's death
82shall be the beneficiary unless such participant designates a
83different beneficiary subsequent to the participant's most
84recent marriage.
85     Section 2.  Paragraphs (j), (k), and (l) of subsection (2)
86of section 121.4501, Florida Statutes, are redesignated as
87paragraphs (k), (l), and (m), respectively, a new paragraph (j)
88is added to said subsection, subsection (4) and paragraph (c) of
89subsection (15) of said section are amended, and paragraph (h)
90is added to subsection (10) of said section, to read:
91     121.4501  Public Employee Optional Retirement Program.--
92     (2)  DEFINITIONS.--As used in this part, the term:
93     (j)  "Retiree" means a former participant of the Public
94Employee Optional Retirement Program of the Florida Retirement
95System who has terminated employment and has taken a
96distribution as provided in s. 121.591, except for a mandatory
97distribution of a de minimis account authorized by the state
98board.
99     (4)  PARTICIPATION; ENROLLMENT.--
100     (a)1.  With respect to an eligible employee who is employed
101in a regularly established position on June 1, 2002, by a state
102employer:
103     a.  Any such employee may elect to participate in the
104Public Employee Optional Retirement Program in lieu of retaining
105his or her membership in the defined benefit program of the
106Florida Retirement System. The election must be made in writing
107or by electronic means and must be filed with the third-party
108administrator by August 31, 2002, or, in the case of an active
109employee who is on a leave of absence on April 1, 2002, by
110August 31, 2002, or by the last business day of the 5th month
111following within 90 days after the conclusion of the leave of
112absence, whichever is later. This election is irrevocable,
113except as provided in paragraph (e). Upon making such election,
114the employee shall be enrolled as a participant of the Public
115Employee Optional Retirement Program, the employee's membership
116in the Florida Retirement System shall be governed by the
117provisions of this part, and the employee's membership in the
118defined benefit program of the Florida Retirement System shall
119terminate. The employee's enrollment in the Public Employee
120Optional Retirement Program shall be effective the first day of
121the month for which a full month's employer contribution is made
122to the optional program.
123     b.  Any such employee who fails to elect to participate in
124the Public Employee Optional Retirement Program within the
125prescribed time period is deemed to have elected to retain
126membership in the defined benefit program of the Florida
127Retirement System, and the employee's option to elect to
128participate in the optional program is forfeited.
129     2.  With respect to employees who become eligible to
130participate in the Public Employee Optional Retirement Program
131by reason of employment in a regularly established position with
132a state employer commencing after April 1, 2002:
133     a.  Any such employee shall, by default, be enrolled in the
134defined benefit retirement program of the Florida Retirement
135System at the commencement of employment, and may, by the last
136business day end of the 5th month following the employee's month
137of hire, elect to participate in the Public Employee Optional
138Retirement Program. The employee's election must be made in
139writing or by electronic means and must be filed with the third-
140party administrator. The election to participate in the optional
141program is irrevocable, except as provided in paragraph (e).
142     b.  If the employee files such election within the
143prescribed time period, enrollment in the optional program shall
144be effective on the first day of employment. The employer
145retirement contributions paid through the month of the employee
146plan change shall be transferred to the optional program, and,
147effective the first day of the next month, the employer shall
148pay the applicable contributions based on the employee
149membership class in the optional program.
150     c.  Any such employee who fails to elect to participate in
151the Public Employee Optional Retirement Program within the
152prescribed time period is deemed to have elected to retain
153membership in the defined benefit program of the Florida
154Retirement System, and the employee's option to elect to
155participate in the optional program is forfeited.
156     3.  With respect to employees who become eligible to
157participate in the Public Employee Optional Retirement Program
158pursuant to s. 121.051(2)(c)3., any such employee may elect to
159participate in the Public Employee Optional Retirement Program
160in lieu of retaining his or her participation in the State
161Community College Optional Retirement Program. The election must
162be made in writing or by electronic means and must be filed with
163the third-party administrator. This election is irrevocable,
164except as provided in paragraph (e). Upon making such election,
165the employee shall be enrolled as a participant of the Public
166Employee Optional Retirement Program, the employee's membership
167in the Florida Retirement System shall be governed by the
168provisions of this part, and the employee's participation in the
169State Community College Optional Retirement Program shall
170terminate. The employee's enrollment in the Public Employee
171Optional Retirement Program shall be effective the first day of
172the month for which a full month's employer contribution is made
173to the optional program.
174     4.  For purposes of this paragraph, "state employer" means
175any agency, board, branch, commission, community college,
176department, institution, institution of higher education, or
177water management district of the state, which participates in
178the Florida Retirement System for the benefit of certain
179employees.
180     (b)1.  With respect to an eligible employee who is employed
181in a regularly established position on September 1, 2002, by a
182district school board employer:
183     a.  Any such employee may elect to participate in the
184Public Employee Optional Retirement Program in lieu of retaining
185his or her membership in the defined benefit program of the
186Florida Retirement System. The election must be made in writing
187or by electronic means and must be filed with the third-party
188administrator by November 30, or, in the case of an active
189employee who is on a leave of absence on July 1, 2002, by
190November 30, 2002, or by the last business day of the 5th month
191following within 90 days after the conclusion of the leave of
192absence, whichever is later. This election is irrevocable,
193except as provided in paragraph (e). Upon making such election,
194the employee shall be enrolled as a participant of the Public
195Employee Optional Retirement Program, the employee's membership
196in the Florida Retirement System shall be governed by the
197provisions of this part, and the employee's membership in the
198defined benefit program of the Florida Retirement System shall
199terminate. The employee's enrollment in the Public Employee
200Optional Retirement Program shall be effective the first day of
201the month for which a full month's employer contribution is made
202to the optional program.
203     b.  Any such employee who fails to elect to participate in
204the Public Employee Optional Retirement Program within the
205prescribed time period is deemed to have elected to retain
206membership in the defined benefit program of the Florida
207Retirement System, and the employee's option to elect to
208participate in the optional program is forfeited.
209     2.  With respect to employees who become eligible to
210participate in the Public Employee Optional Retirement Program
211by reason of employment in a regularly established position with
212a district school board employer commencing after July 1, 2002:
213     a.  Any such employee shall, by default, be enrolled in the
214defined benefit retirement program of the Florida Retirement
215System at the commencement of employment, and may, by the last
216business day end of the 5th month following the employee's month
217of hire, elect to participate in the Public Employee Optional
218Retirement Program. The employee's election must be made in
219writing or by electronic means and must be filed with the third-
220party administrator. The election to participate in the optional
221program is irrevocable, except as provided in paragraph (e).
222     b.  If the employee files such election within the
223prescribed time period, enrollment in the optional program shall
224be effective on the first day of employment. The employer
225retirement contributions paid through the month of the employee
226plan change shall be transferred to the optional program, and,
227effective the first day of the next month, the employer shall
228pay the applicable contributions based on the employee
229membership class in the optional program.
230     c.  Any such employee who fails to elect to participate in
231the Public Employee Optional Retirement Program within the
232prescribed time period is deemed to have elected to retain
233membership in the defined benefit program of the Florida
234Retirement System, and the employee's option to elect to
235participate in the optional program is forfeited.
236     3.  For purposes of this paragraph, "district school board
237employer" means any district school board that participates in
238the Florida Retirement System for the benefit of certain
239employees, or a charter school or charter technical career
240center that participates in the Florida Retirement System as
241provided in s. 121.051(2)(d).
242     (c)1.  With respect to an eligible employee who is employed
243in a regularly established position on December 1, 2002, by a
244local employer:
245     a.  Any such employee may elect to participate in the
246Public Employee Optional Retirement Program in lieu of retaining
247his or her membership in the defined benefit program of the
248Florida Retirement System. The election must be made in writing
249or by electronic means and must be filed with the third-party
250administrator by February 28, 2003, or, in the case of an active
251employee who is on a leave of absence on October 1, 2002, by
252February 28, 2003, or by the last business day of the 5th month
253following within 90 days after the conclusion of the leave of
254absence, whichever is later. This election is irrevocable,
255except as provided in paragraph (e). Upon making such election,
256the employee shall be enrolled as a participant of the Public
257Employee Optional Retirement Program, the employee's membership
258in the Florida Retirement System shall be governed by the
259provisions of this part, and the employee's membership in the
260defined benefit program of the Florida Retirement System shall
261terminate. The employee's enrollment in the Public Employee
262Optional Retirement Program shall be effective the first day of
263the month for which a full month's employer contribution is made
264to the optional program.
265     b.  Any such employee who fails to elect to participate in
266the Public Employee Optional Retirement Program within the
267prescribed time period is deemed to have elected to retain
268membership in the defined benefit program of the Florida
269Retirement System, and the employee's option to elect to
270participate in the optional program is forfeited.
271     2.  With respect to employees who become eligible to
272participate in the Public Employee Optional Retirement Program
273by reason of employment in a regularly established position with
274a local employer commencing after October 1, 2002:
275     a.  Any such employee shall, by default, be enrolled in the
276defined benefit retirement program of the Florida Retirement
277System at the commencement of employment, and may, by the last
278business day end of the 5th month following the employee's month
279of hire, elect to participate in the Public Employee Optional
280Retirement Program. The employee's election must be made in
281writing or by electronic means and must be filed with the third-
282party administrator. The election to participate in the optional
283program is irrevocable, except as provided in paragraph (e).
284     b.  If the employee files such election within the
285prescribed time period, enrollment in the optional program shall
286be effective on the first day of employment. The employer
287retirement contributions paid through the month of the employee
288plan change shall be transferred to the optional program, and,
289effective the first day of the next month, the employer shall
290pay the applicable contributions based on the employee
291membership class in the optional program.
292     c.  Any such employee who fails to elect to participate in
293the Public Employee Optional Retirement Program within the
294prescribed time period is deemed to have elected to retain
295membership in the defined benefit program of the Florida
296Retirement System, and the employee's option to elect to
297participate in the optional program is forfeited.
298     3.  For purposes of this paragraph, "local employer" means
299any employer not included in paragraph (a) or paragraph (b).
300     (d)  Contributions available for self-direction by a
301participant who has not selected one or more specific investment
302products shall be allocated as prescribed by the board. The
303third-party administrator shall notify any such participant at
304least quarterly that the participant should take an affirmative
305action to make an asset allocation among the optional program
306products.
307     (e)  After the period during which an eligible employee had
308the choice to elect the defined benefit program or the Public
309Employee Optional Retirement Program, or the month following the
310eligible employee's plan selection effective date, if sooner,
311the employee shall have one opportunity, at the employee's
312discretion, to choose to move from the defined benefit program
313to the Public Employee Optional Retirement Program or from the
314Public Employee Optional Retirement Program to the defined
315benefit program. This paragraph shall be contingent upon
316approval from the Internal Revenue Service for including the
317choice described herein within the programs offered by the
318Florida Retirement System.
319     1.  If the employee chooses to move to the Public Employee
320Optional Retirement Program, the applicable provisions of this
321section shall govern the transfer.
322     2.  If the employee chooses to move to the defined benefit
323program, the employee must transfer from his or her Public
324Employee Optional Retirement Program account and from other
325employee moneys as necessary, a sum representing the present
326value of that employee's accumulated benefit obligation
327immediately following the time of such movement, determined
328assuming that attained service equals the sum of service in the
329defined benefit program and service in the Public Employee
330Optional Retirement Program. Benefit commencement occurs on the
331first date the employee would become eligible for unreduced
332benefits, using the discount rate and other relevant actuarial
333assumptions that were used to value the Florida Retirement
334System defined benefit plan liabilities in the most recent
335actuarial valuation. For any employee who, at the time of the
336second election, already maintains an accrued benefit amount in
337the defined benefit plan, the then-present value of such accrued
338benefit shall be deemed part of the required transfer amount
339described in this subparagraph. The division shall ensure that
340the transfer sum is prepared using a formula and methodology
341certified by an enrolled actuary.
342     3.  Notwithstanding subparagraph 2., an employee who
343chooses to move to the defined benefit program and who became
344eligible to participate in the Public Employee Optional
345Retirement Program by reason of employment in a regularly
346established position with a state employer after June 1, 2002; a
347district school board employer after September 1, 2002; or a
348local employer after December 1, 2002, must transfer from his or
349her Public Employee Optional Retirement Program account and,
350from other employee moneys as necessary, a sum representing that
351employee's actuarial accrued liability.
352     4.  Employees' ability to transfer from the Florida
353Retirement System defined benefit program to the Public Employee
354Optional Retirement Program pursuant to paragraphs (a) through
355(d), and the ability for current employees to have an option to
356later transfer back into the defined benefit program under
357subparagraph 2., shall be deemed a significant system amendment.
358Pursuant to s. 121.031(4), any such resulting unfunded liability
359arising from actual original transfers from the defined benefit
360program to the optional program shall be amortized within 30
361plan years as a separate unfunded actuarial base independent of
362the reserve stabilization mechanism defined in s. 121.031(3)(f).
363For the first 25 years, no direct amortization payment shall be
364calculated for this base. During this 25-year period, such
365separate base shall be used to offset the impact of employees
366exercising their second program election under this paragraph.
367It is the legislative intent that the actuarial funded status of
368the Florida Retirement System defined benefit plan is neither
369beneficially nor adversely impacted by such second program
370elections in any significant manner, after due recognition of
371the separate unfunded actuarial base. Following this initial 25-
372year period, any remaining balance of the original separate base
373shall be amortized over the remaining 5 years of the required
37430-year amortization period.
375     (10)  EDUCATION COMPONENT.--
376     (h)  Pursuant to paragraph (8)(a), all Florida Retirement
377System employers have an obligation to regularly communicate the
378existence of the two Florida Retirement System plans and the
379plan choice in the natural course of administering their
380personnel functions using the educational materials supplied by
381the state board and the Department of Management Services.
382     (15)  STATEMENT OF FIDUCIARY STANDARDS AND
383RESPONSIBILITIES.--
384     (c)  Subparagraph (8)(b)4. and paragraph (15)(b)
385incorporate the federal law concept of participant control,
386established by regulations of the United States Department of
387Labor under s. 404(c) of the Employee Retirement Income Security
388Act of 1974 (ERISA). The purpose of this paragraph is to assist
389employers and the State Board of Administration in maintaining
390compliance with s. 404(c), while avoiding unnecessary costs and
391eroding participant benefits under the Public Employee Optional
392Retirement Program. Pursuant to 29 C.F.R. s. 2550.404c-
3931(b)(2)(i)(B)(1)(viii), the State Board of Administration or its
394designated agents shall deliver to participants of the Public
395Employee Optional Retirement Program a copy of the prospectus
396most recently provided to the plan and, pursuant to 29 C.F.R. s.
3972550.404c-1(b)(2), or shall provide such participants an
398opportunity to obtain this information, except that:
399     1.  The requirement to deliver a prospectus shall be deemed
400to be satisfied by delivery of a fund profile that contains the
401information that would be included in a summary prospectus as
402described by Rule 498 under the Securities Act of 1933, 17
403C.F.R. s. 230.498. When the transaction fees, expense
404information or other information provided by a mutual fund in
405the prospectus does not reflect terms negotiated by the State
406Board of Administration or its designated agents, the
407aforementioned requirement is deemed to be satisfied by delivery
408of a separate document described by Rule 498 substituting
409accurate information; and
410     2.  Delivery shall be deemed to have been effected if
411delivery is through electronic means and the following standards
412are satisfied:
413     a.  Electronically-delivered documents are prepared and
414provided consistent with style, format, and content requirements
415applicable to printed documents;
416     b.  Each participant is provided timely and adequate notice
417of the documents that are to be delivered and their significance
418thereof, and of the participant's right to obtain a paper copy
419of such documents free of charge;
420     c.(I)  Participants have adequate access to the electronic
421documents, at locations such as their worksites or public
422facilities, and have the ability to convert the documents to
423paper free of charge by the State Board of Administration, and
424the board or its designated agents take appropriate and
425reasonable measures to ensure that the system for furnishing
426electronic documents results in actual receipt, or
427     (II)  Participants have provided consent to receive
428information in electronic format, which consent may be revoked;
429and
430     d.  The State Board of Administration, or its designated
431agent, actually provides paper copies of the documents free of
432charge, upon request.
433     Section 3.  Section 121.591, Florida Statutes, is amended
434to read:
435     121.591  Benefits payable under the Public Employee
436Optional Retirement Program of the Florida Retirement
437System.--Benefits may not be paid under this section unless the
438Benefits may not be paid under this section unless the member
439has terminated employment as provided in s. 121.021(39)(a) or is
440deceased and a proper application has been filed in the manner
441prescribed by the state board or the department. The state board
442or department, as appropriate, may cancel an application for
443retirement benefits when the member or beneficiary fails to
444timely provide the information and documents required by this
445chapter and the rules of the state board and department. In
446accordance with their respective responsibilities as provided
447herein, the State Board of Administration and the Department of
448Management Services shall adopt rules establishing procedures
449for application for retirement benefits and for the cancellation
450of such application when the required information or documents
451are not received. The State Board of Administration and the
452Department of Management Services, as appropriate, are
453authorized to cash out a de minimis account of a participant who
454has been terminated from Florida Retirement System covered
455employment for a minimum of 6 calendar months. A de minimis
456account is an account containing employer contributions and
457accumulated earnings of not more than $5,000 made under the
458provisions of this chapter. Such cash-out must either be a
459complete lump-sum liquidation of the account balance, subject to
460the provisions of the Internal Revenue Code, or a lump-sum
461direct rollover distribution paid directly to the custodian of
462an eligible retirement plan, as defined by the Internal Revenue
463Code, on behalf of the participant.
464     (1)  NORMAL BENEFITS.--Under the Public Employee Optional
465Retirement Program:
466     (a)  Benefits in the form of vested accumulations as
467described in s. 121.4501(6) shall be payable under this
468subsection in accordance with the following terms and
469conditions:
470     1.  To the extent vested, benefits shall be payable only to
471a participant.
472     2.  Benefits shall be paid by the third-party administrator
473or designated approved providers in accordance with the law, the
474contracts, and any applicable board rule or policy.
475     3.  To receive benefits under this subsection, the
476participant must be terminated from all employment with all
477Florida Retirement System employers, as provided in s.
478121.021(39).
479     (b)  If a participant elects to receive his or her benefits
480upon termination of employment, the participant must submit a
481written application to the third-party administrator indicating
482his or her preferred distribution date and selecting an
483authorized method of distribution as provided in paragraph (c).
484The participant may defer receipt of benefits until he or she
485chooses to make such application, subject to federal
486requirements.
487     (c)  Upon receipt by the third-party administrator of a
488properly executed application for distribution of benefits, the
489total accumulated benefit shall be payable to the participant,
490as:
491     1.  A lump-sum distribution to the participant;
492     2.  A lump-sum direct rollover distribution whereby all
493accrued benefits, plus interest and investment earnings, are
494paid from the participant's account directly to the custodian of
495an eligible retirement plan, as defined in s. 402(c)(8)(B) of
496the Internal Revenue Code, on behalf of the participant; or
497     3.  Periodic distributions, as authorized by the state
498board.
499     (2)  DISABILITY RETIREMENT BENEFITS.--Benefits provided
500under this subsection are payable in lieu of the benefits which
501would otherwise be payable under the provisions of subsection
502(1). Such benefits shall be funded entirely from employer
503contributions made under s. 121.571, transferred participant
504funds accumulated pursuant to paragraph (a), and interest and
505earnings thereon. Pursuant thereto:
506     (a)  Transfer of funds.--To qualify to receive monthly
507disability benefits under this subsection:
508     1.  All moneys accumulated in the participant's Public
509Employee Optional Retirement Program accounts, including vested
510and nonvested accumulations as described in s. 121.4501(6),
511shall be transferred from such individual accounts to the
512Division of Retirement for deposit in the disability account of
513the Florida Retirement System Trust Fund. Such moneys shall be
514separately accounted for. Earnings shall be credited on an
515annual basis for amounts held in the disability accounts of the
516Florida Retirement System Trust Fund based on actual earnings of
517the Florida Retirement System Trust Fund.
518     2.  If the participant has retained retirement credit he or
519she had earned under the defined benefit program of the Florida
520Retirement System as provided in s. 121.4501(3)(b), a sum
521representing the actuarial present value of such credit within
522the Florida Retirement System Trust Fund shall be reassigned by
523the Division of Retirement from the defined benefit program to
524the disability program as implemented under this subsection and
525shall be deposited in the disability account of the Florida
526Retirement System Trust Fund. Such moneys shall be separately
527accounted for.
528     (b)  Disability retirement; entitlement.--
529     1.  A participant of the Public Employee Optional
530Retirement Program who becomes totally and permanently disabled,
531as defined in s. 121.091(4)(b), after completing 8 years of
532creditable service, or a participant who becomes totally and
533permanently disabled in the line of duty regardless of his or
534her length of service, shall be entitled to a monthly disability
535benefit as provided herein.
536     2.  In order for service to apply toward the 8 years of
537service required to vest for regular disability benefits, or
538toward the creditable service used in calculating a service-
539based benefit as provided for under paragraph (g), the service
540must be creditable service as described below:
541     a.  The participant's period of service under the Public
542Employee Optional Retirement Program will be considered
543creditable service, except as provided in subparagraph d.
544     b.  If the participant has elected to retain credit for his
545or her service under the defined benefit program of the Florida
546Retirement System as provided under s. 121.4501(3)(b), all such
547service will be considered creditable service.
548     c.  If the participant has elected to transfer to his or
549her participant accounts a sum representing the present value of
550his or her retirement credit under the defined benefit program
551as provided under s. 121.4501(3)(c), the period of service under
552the defined benefit program represented in the present value
553amounts transferred will be considered creditable service for
554purposes of vesting for disability benefits, except as provided
555in subparagraph d.
556     d.  Whenever a participant has terminated employment and
557has taken distribution of his or her funds as provided in
558subsection (1), all creditable service represented by such
559distributed funds is forfeited for purposes of this subsection.
560     (c)  Disability retirement effective date.--The effective
561retirement date for a participant who applies and is approved
562for disability retirement shall be established as provided under
563s. 121.091(4)(a)2. and 3.
564     (d)  Total and permanent disability.--A participant shall
565be considered totally and permanently disabled if, in the
566opinion of the division, he or she is prevented, by reason of a
567medically determinable physical or mental impairment, from
568rendering useful and efficient service as an officer or
569employee.
570     (e)  Proof of disability.--The division, before approving
571payment of any disability retirement benefit, shall require
572proof that the participant is totally and permanently disabled
573in the same manner as provided for members of the defined
574benefit program of the Florida Retirement System under s.
575121.091(4)(c).
576     (f)  Disability retirement benefit.--Upon the disability
577retirement of a participant under this subsection, the
578participant shall receive a monthly benefit that shall begin to
579accrue on the first day of the month of disability retirement,
580as approved by the division, and shall be payable on the last
581day of that month and each month thereafter during his or her
582lifetime and continued disability. All disability benefits
583payable to such member shall be paid out of the disability
584account of the Florida Retirement System Trust Fund established
585under this subsection.
586     (g)  Computation of disability retirement benefit.--The
587amount of each monthly payment shall be calculated in the same
588manner as provided for members of the defined benefit program of
589the Florida Retirement System under s. 121.091(4)(f). For such
590purpose, creditable service under both the defined benefit
591program and the Public Employee Optional Retirement Program of
592the Florida Retirement System shall be applicable as provided
593under paragraph (b).
594     (h)  Reapplication.--A participant whose initial
595application for disability retirement has been denied may
596reapply for disability benefits in the same manner, and under
597the same conditions, as provided for members of the defined
598benefit program of the Florida Retirement System under s.
599121.091(4)(g).
600     (i)  Membership.--Upon approval of an application for
601disability benefits under this subsection, the applicant shall
602be transferred to the defined benefit program of the Florida
603Retirement System, effective upon his or her disability
604retirement effective date.
605     (j)  Option to cancel.--Any participant whose application
606for disability benefits is approved may cancel his or her
607application for disability benefits, provided that the
608cancellation request is received by the division before a
609disability retirement warrant has been deposited, cashed, or
610received by direct deposit. Upon such cancellation:
611     1.  The participant's transfer to the defined benefit
612program under paragraph (i) shall be nullified;
613     2.  The participant shall be retroactively reinstated in
614the Public Employee Optional Retirement Program without hiatus;
615     3.  All funds transferred to the Florida Retirement System
616Trust Fund under paragraph (a) shall be returned to the
617participant accounts from which such funds were drawn; and
618     4.  The participant may elect to receive the benefit
619payable under the provisions of subsection (1) in lieu of
620disability benefits as provided under this subsection.
621     (k)  Recovery from disability.--
622     1.  The division may require periodic reexaminations at the
623expense of the disability program account of the Florida
624Retirement System Trust Fund. Except as otherwise provided in
625subparagraph 2., the requirements, procedures, and restrictions
626relating to the conduct and review of such reexaminations,
627discontinuation or termination of benefits, reentry into
628employment, disability retirement after reentry into covered
629employment, and all other matters relating to recovery from
630disability shall be the same as are set forth under s.
631121.091(4)(h).
632     2.  Upon recovery from disability, any recipient of
633disability retirement benefits under this subsection shall be a
634compulsory member of the Public Employee Optional Retirement
635Program of the Florida Retirement System. The net difference
636between the recipient's original account balance transferred to
637the Florida Retirement System Trust Fund, including earnings,
638under paragraph (a) and total disability benefits paid to such
639recipient, if any, shall be determined as provided in sub-
640subparagraph a.
641     a.  An amount equal to the total benefits paid shall be
642subtracted from that portion of the transferred account balance
643consisting of vested accumulations as described under s.
644121.4501(6), if any, and an amount equal to the remainder of
645benefit amounts paid, if any, shall then be subtracted from any
646remaining portion consisting of nonvested accumulations as
647described under s. 121.4501(6).
648     b.  Amounts subtracted under sub-subparagraph a. shall be
649retained within the disability account of the Florida Retirement
650System Trust Fund. Any remaining account balance shall be
651transferred to the third-party administrator for disposition as
652provided under sub-subparagraph c. or sub-subparagraph d., as
653appropriate.
654     c.  If the recipient returns to covered employment,
655transferred amounts shall be deposited in individual accounts
656under the Public Employee Optional Retirement Program, as
657directed by the participant. Vested and nonvested amounts shall
658be separately accounted for as provided in s. 121.4501(6).
659     d.  If the recipient fails to return to covered employment
660upon recovery from disability:
661     (I)  Any remaining vested amount shall be deposited in
662individual accounts under the Public Employee Optional
663Retirement Program, as directed by the participant, and shall be
664payable as provided in subsection (1).
665     (II)  Any remaining nonvested amount shall be held in a
666suspense account and shall be forfeitable after 5 years as
667provided in s. 121.4501(6).
668     3.  If present value was reassigned from the defined
669benefit program to the disability program of the Florida
670Retirement System as provided under subparagraph (a)2., the full
671present value amount shall be returned to the defined benefit
672account within the Florida Retirement System Trust Fund and the
673affected individual's associated retirement credit under the
674defined benefit program shall be reinstated in full. Any benefit
675based upon such credit shall be calculated as provided in s.
676121.091(4)(h)1.
677     (l)  Nonadmissible causes of disability.--A participant
678shall not be entitled to receive a disability retirement benefit
679if the disability results from any injury or disease sustained
680or inflicted as described in s. 121.091(4)(i).
681     (m)  Disability retirement of justice or judge by order of
682Supreme Court.--
683     1.  If a participant is a justice of the Supreme Court,
684judge of a district court of appeal, circuit judge, or judge of
685a county court who has served for 6 years or more as an elected
686constitutional judicial officer, including service as a judicial
687officer in any court abolished pursuant to Art. V of the State
688Constitution, and who is retired for disability by order of the
689Supreme Court upon recommendation of the Judicial Qualifications
690Commission pursuant to the provisions of Art. V of the State
691Constitution, the participant's Option 1 monthly disability
692benefit amount as provided in s. 121.091(6)(a)1. shall be two-
693thirds of his or her monthly compensation as of the
694participant's disability retirement date. Such a participant may
695alternatively elect to receive an actuarially adjusted
696disability retirement benefit under any other option as provided
697in s. 121.091(6)(a), or to receive the normal benefit payable
698under the Public Employee Optional Retirement Program as set
699forth in subsection (1).
700     2.  If any justice or judge who is a participant of the
701Public Employee Optional Retirement Program of the Florida
702Retirement System is retired for disability by order of the
703Supreme Court upon recommendation of the Judicial Qualifications
704Commission pursuant to the provisions of Art. V of the State
705Constitution and elects to receive a monthly disability benefit
706under the provisions of this paragraph:
707     a.  Any present value amount that was transferred to his or
708her program account and all employer contributions made to such
709account on his or her behalf, plus interest and earnings
710thereon, shall be transferred to and deposited in the disability
711account of the Florida Retirement System Trust Fund; and
712     b.  The monthly benefits payable under this paragraph for
713any affected justice or judge retired from the Florida
714Retirement System pursuant to Art. V of the State Constitution
715shall be paid from the disability account of the Florida
716Retirement System Trust Fund.
717     (n)  Death of retiree or beneficiary.--Upon the death of a
718disabled retiree or beneficiary thereof who is receiving monthly
719benefits under this subsection, the monthly benefits shall be
720paid through the last day of the month of death and shall
721terminate, or be adjusted, if applicable, as of that date in
722accordance with the optional form of benefit selected at the
723time of retirement. The deceased disabled retiree's beneficiary
724shall also receive the amount of the participant's remaining
725account balance, if any, in the Florida Retirement System Trust
726Fund. The Department of Management Services may adopt rules
727necessary to administer this paragraph.
728     (3)  DEATH BENEFITS.--Under the Public Employee Optional
729Retirement Program:
730     (a)  Survivor benefits shall be payable in accordance with
731the following terms and conditions:
732     1.  To the extent vested, benefits shall be payable only to
733a participant's beneficiary or beneficiaries as designated by
734the participant. If a participant designates a primary
735beneficiary other than the participant's spouse, the
736participant's spouse shall be notified of the designation. This
737requirement shall not apply to the designation of one or more
738contingent beneficiaries to receive any benefits remaining upon
739the death of the primary beneficiary or beneficiaries.
740     2.  Benefits shall be paid by the third-party administrator
741or designated approved providers in accordance with the law, the
742contracts, and any applicable board rule or policy.
743     3.  To receive benefits under this subsection, the
744participant must be deceased.
745     (b)  In the event of a participant's death, all vested
746accumulations as described in s. 121.4501(6), less withholding
747taxes remitted to the Internal Revenue Service, shall be
748distributed, as provided in paragraph (c), to the participant's
749designated beneficiary or beneficiaries, or to the participant's
750estate, as if the participant retired on the date of death. No
751other death benefits shall be available for survivors of
752participants under the Public Employee Optional Retirement
753Program, except for such benefits, or coverage for such
754benefits, as are otherwise provided by law or are separately
755afforded by the employer, at the employer's discretion.
756     (c)  Upon receipt by the third-party administrator of a
757properly executed application for distribution of benefits, the
758total accumulated benefit shall be payable by the third-party
759administrator to the participant's surviving beneficiary or
760beneficiaries, as:
761     1.  A lump-sum distribution payable to the beneficiary or
762beneficiaries, or to the deceased participant's estate;
763     2.  An eligible rollover distribution on behalf of the
764surviving spouse of a deceased participant, whereby all accrued
765benefits, plus interest and investment earnings, are paid from
766the deceased participant's account directly to the custodian of
767an eligible retirement plan, as described in s. 402(c)(8)(B) of
768the Internal Revenue Code, on behalf of the surviving spouse; or
769     3.  A partial lump-sum payment whereby a portion of the
770accrued benefit is paid to the deceased participant's surviving
771spouse or other designated beneficiaries, less withholding taxes
772remitted to the Internal Revenue Service, and the remaining
773amount is transferred directly to the custodian of an eligible
774retirement plan, as described in s. 402(c)(8)(B) of the Internal
775Revenue Code, on behalf of the surviving spouse. The proportions
776must be specified by the participant or the surviving
777beneficiary.
778
779This paragraph does not abrogate other applicable provisions of
780state or federal law providing for payment of death benefits.
781     (4)  LIMITATION ON LEGAL PROCESS.--The benefits payable to
782any person under the Public Employee Optional Retirement
783Program, and any contributions accumulated under such program,
784are not subject to assignment, execution, attachment, or any
785legal process, except for qualified domestic relations orders by
786a court of competent jurisdiction, income deduction orders as
787provided in s. 61.1301, and federal income tax levies.
788     Section 4.  Paragraph (b) of subsection (3) of section
789121.78, Florida Statutes, is amended to read:
790     121.78  Payment and distribution of contributions.--
791     (3)
792     (b)  If contributions made by an employer on behalf of
793participants of the optional retirement program or accompanying
794payroll data are not received within the calendar month they are
795due, including, but not limited to, contribution adjustments as
796a result of employer errors or corrections, and if that
797delinquency results in market losses to participants, the
798employer shall reimburse each participant's account for market
799losses resulting from the late contributions. In the event a
800participant has terminated employment and taken a distribution,
801the participant is responsible for returning any excess
802contributions erroneously provided by employers, adjusted for
803any investment gain or loss incurred during the period such
804excess contributions were in the participant's Public Employee
805Optional Retirement Program account. The State Board of
806Administration, or its designated agent, shall communicate to
807terminated participants any obligation to repay such excess
808contribution amounts. However, the State Board of
809Administration, its designated agent, the Public Employee
810Optional Retirement Program Trust Fund, the Department of
811Management Services, or the Florida Retirement System Trust Fund
812shall not incur any loss or gain as a result of employer
813correction of such excess contributions. The third-party
814administrator, hired by the board pursuant to s. 121.4501(8),
815shall calculate the market losses for each affected participant.
816When contributions made on behalf of participants of the
817optional retirement program or accompanying payroll data are not
818received within the calendar month due, the employer shall also
819pay the cost of the third-party administrator's calculation and
820reconciliation adjustments resulting from the late
821contributions. The third-party administrator shall notify the
822employer of the results of the calculations and the total amount
823due from the employer for such losses and the costs of
824calculation and reconciliation. The employer shall remit to the
825division the amount due within 10 working days after the date of
826the penalty notice sent by the division. The division shall
827transfer said amount to the third-party administrator, who shall
828deposit proceeds from the 1-percent assessment and from
829individual market losses into participant accounts, as
830appropriate. The board is authorized to adopt rules to implement
831the provisions regarding late contributions, late submission of
832payroll data, the process for reimbursing participant accounts
833for resultant market losses, and the penalties charged to the
834employers.
835     Section 5.  Paragraphs (f), (g), and (i) of subsection (2)
836of section 215.47, Florida Statutes, are amended to read:
837     215.47  Investments; authorized securities; loan of
838securities.--Subject to the limitations and conditions of the
839State Constitution or of the trust agreement relating to a trust
840fund, moneys available for investments under ss. 215.44-215.53
841may be invested as follows:
842     (2)  With no more than 25 percent of any fund in:
843     (f)  Certain interests in real property and related
844personal property, including mortgages and related instruments
845on commercial or industrial real property, with provisions for
846equity or income participation or with provisions for
847convertibility to equity ownership; and interests in collective
848investment funds. Associated expenditures for acquisition and
849operation of assets purchased under this provision or of
850investments in private equity or other private investment
851partnerships or limited liability companies shall be included as
852a part of the cost of the investment.
853     1.  The title to real property acquired under this
854paragraph shall be vested in the name of the respective fund.
855     2.  For purposes of taxation of property owned by any fund,
856the provisions of s. 196.199(2)(b) do not apply.
857     3.  Real property acquired under the provisions of this
858paragraph shall not be considered state lands or public lands
859and property as defined in chapter 253, and the provisions of
860that chapter do not apply to such real property.
861     (g)  Fixed-income obligations not otherwise authorized by
862this section issued by foreign governments, or political
863subdivisions or agencies thereof, supranational agencies,
864foreign corporations, or foreign commercial entities, provided
865the obligations are rated investment grade by at least one
866nationally recognized rating service General obligations backed
867by the full faith and credit of a foreign government which has
868not defaulted on similar obligations for a minimum period of 25
869years prior to purchase of the obligation and has met its
870payments of similar obligations when due.
871     (i)  Obligations of agencies of the government of the
872United States, provided such obligations have been included in
873and authorized by the Florida Retirement System Defined Benefit
874Total Fund Investment Plan Investment Policy Statement
875established in s. 215.475.
876     Section 6.  Section 215.475, Florida Statutes, is amended
877to read:
878     215.475  Investment policy statement plan.--
879     (1)  In making investments for the System Trust Fund
880pursuant to ss. 215.44-215.53, the board shall make no
881investment which is not in conformance with the Florida
882Retirement System Defined Benefit Total Fund Investment Plan
883Investment Policy Statement, hereinafter referred to as "the
884statement plan," as developed by the executive director and
885approved by the board. The statement plan must include, among
886other items, the investment objectives of the System Trust Fund;
887permitted types of securities in which the board may invest; and
888evaluation criteria necessary to measure the investment
889performance of the fund. As required from time to time, the
890executive director of the board may present recommended changes
891in the statement plan to the board for approval.
892     (2)  Prior to any recommended changes in the statement plan
893being presented to the board, the executive director of the
894board shall present such changes to the Investment Advisory
895Council for review. The council shall present the results of its
896review to the board prior to the board's final approval of the
897statement plan or changes in the statement plan.
898     Section 7.  Paragraph (a) of subsection (4) of section
899215.5601, Florida Statutes, is amended to read:
900     215.5601  Lawton Chiles Endowment Fund.--
901     (4)  ADMINISTRATION.--
902     (a)  The board may invest and reinvest funds of the
903endowment in accordance with s. 215.47 and consistent with an
904investment policy statement plan developed by the executive
905director and approved by the board.
906     Section 8.  This act shall take effect July 1, 2004.


CODING: Words stricken are deletions; words underlined are additions.
Site Map
Session:   Bills ·   Calendars ·   Bound Journals ·   Citator ·   Search ·   Appropriations ·   Redistricting ·   Bill Information Reports
Committee Publications
Historical Information
Statutes:   Introduction ·   View Statutes ·   Search Statutes
Flsenate.gov
Disclaimer: The information on this system is unverified. The journals or printed bills of the respective chambers should be consulted for official purposes.    Copyright © 2000-2020 State of Florida.     Privacy Statement     Contact Us     Get Acrobat Reader