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       Florida Senate - 2010                      CS for CS for SB 1078
       By the Committees on General Government Appropriations; and
       Governmental Oversight and Accountability; and Senator Ring
       601-04209-10                                          20101078c2
    1                        A bill to be entitled                      
    2         An act relating to state financial matters; amending
    3         s. 121.4501, F.S.; defining the term “electronic
    4         means” and redefining the term “optional retirement
    5         program”; providing for excess account balances in the
    6         Public Employee Optional Retirement Program when an
    7         employee transfers to the defined benefit program and
    8         for the use of such excess balance; requiring the
    9         State Board of Administration to develop procedures to
   10         resolve complaints; providing for the use of records
   11         in resolving such complaints; clarifying the state
   12         board’s rule authority with respect to the program;
   13         amending s. 121.4502, F.S.; establishing a forfeiture
   14         account in the Public Employee Retirement Program
   15         Trust Fund and providing for the use of funds in the
   16         account; amending s. 121.591, F.S.; permitting an
   17         application for benefits under the optional retirement
   18         program to be submitted by electronic means; amending
   19         s. 121.74, F.S.; revising the contribution rates for
   20         employers participating in the Florida Retirement
   21         System; amending s. 121.78, F.S.; exempting the
   22         Division of Retirement, the state board, and the
   23         third-party administrator from liability for market
   24         losses due to acts of God; amending s. 215.44, F.S.;
   25         authorizing the State Board of Administration to
   26         invest the funds of any state university or college or
   27         a direct-support organization of any state agency,
   28         university or college, or local government; amending
   29         s. 215.47, F.S.; expanding the types of investments
   30         that the state board is authorized to make; increasing
   31         the fund amount that may be invested in a foreign
   32         entity; amending s. 218.409, F.S.; providing for
   33         extending a moratorium on contributions to the Local
   34         Government Surplus Funds Trust Fund under certain
   35         circumstances; authorizing the state board to develop
   36         work products that are subject to trademark,
   37         copyright, or patent; providing an effective date.
   39  Be It Enacted by the Legislature of the State of Florida:
   41         Section 1. Subsection (2), paragraph (e) of subsection (4),
   42  subsection (6), and paragraphs (a) and (g) of subsection (8) of
   43  section 121.4501, Florida Statutes, are amended to read:
   44         121.4501 Public Employee Optional Retirement Program.—
   45         (2) DEFINITIONS.—As used in this part, the term:
   46         (a) “Approved provider” or “provider” means a private
   47  sector company that is selected and approved by the state board
   48  to offer one or more investment products or services to the
   49  Public Employee optional retirement program. The term includes a
   50  bundled provider that offers participants a range of
   51  individually allocated or unallocated investment products and
   52  may offer a range of administrative and customer services, which
   53  may include accounting and administration of individual
   54  participant benefits and contributions; individual participant
   55  recordkeeping; asset purchase, control, and safekeeping; direct
   56  execution of the participant’s instructions as to asset and
   57  contribution allocation; calculation of daily net asset values;
   58  direct access to participant account information; periodic
   59  reporting to participants, at least quarterly, on account
   60  balances and transactions; guidance, advice, and allocation
   61  services directly relating to the provider’s its own investment
   62  options or products, but only if the bundled provider complies
   63  with the standard of care of s. 404(a)(1)(A-B) of the Employee
   64  Retirement Income Security Act of 1974 (ERISA) and if providing
   65  such guidance, advice, or allocation services does not
   66  constitute a prohibited transaction under s. 4975(c)(1) of the
   67  Internal Revenue Code or s. 406 of ERISA, notwithstanding that
   68  such prohibited transaction provisions do not apply to the
   69  optional retirement program; a broad array of distribution
   70  options; asset allocation; and retirement counseling and
   71  education. Private sector companies include investment
   72  management companies, insurance companies, depositories, and
   73  mutual fund companies.
   74         (b) “Average monthly compensation” means one-twelfth of
   75  average final compensation as defined in s. 121.021(24).
   76         (c) “Covered employment” means employment in a regularly
   77  established position as defined in s. 121.021(52).
   78         (d) Defined benefit program” means the defined benefit
   79  program of the Florida Retirement System administered under part
   80  I of this chapter “Department” means the Department of
   81  Management Services.
   82         (e)(e) “Division” means the Division of Retirement within
   83  the department of Management Services.
   84         (f) “Electronic means” means by telephone, if the required
   85  information is received on a recorded line, or through Internet
   86  access, if the required information is captured online.
   87         (g)(f) “Eligible employee” means an officer or employee, as
   88  defined in s. 121.021, who:
   89         1. Is a member of, or is eligible for membership in, the
   90  Florida Retirement System, including any renewed member of the
   91  Florida Retirement System initially enrolled before July 1,
   92  2010; or
   93         2. Participates in, or is eligible to participate in, the
   94  Senior Management Service Optional Annuity Program as
   95  established under s. 121.055(6), the State Community College
   96  System Optional Retirement Program as established under s.
   97  121.051(2)(c), or the State University System Optional
   98  Retirement Program established under s. 121.35.
  100  The term does not include any member participating in the
  101  Deferred Retirement Option Program established under s.
  102  121.091(13), a retiree of a state-administered retirement system
  103  initially reemployed on or after July 1, 2010, or a mandatory
  104  participant of the State University System Optional Retirement
  105  Program established under s. 121.35.
  106         (h)(g) “Employer” means an employer, as defined in s.
  107  121.021(10), of an eligible employee.
  108         (i) “Optional retirement program” or “optional program”
  109  means the Public Employee Optional Retirement Program
  110  established under this part.
  111         (j)(h) “Participant” means an eligible employee who elects
  112  to participate in the Public Employee Optional Retirement
  113  Program and enrolls in the such optional program as provided in
  114  subsection (4) or a terminated Deferred Retirement Option
  115  Program participant as described in subsection (21).
  116         (i)“Public Employee Optional Retirement Program,”
  117  “optional program,” or “optional retirement program” means the
  118  alternative defined contribution retirement program established
  119  under this section.
  120         (k)(j) “Retiree” means a former participant of the Florida
  121  Retirement System Public Employee optional retirement program
  122  who has terminated employment and has taken a distribution as
  123  provided in s. 121.591, except for a mandatory distribution of a
  124  de minimis account authorized by the state board.
  125         (k)“State board” or “board” means the State Board of
  126  Administration.
  127         (l)“Trustees” means Trustees of the State Board of
  128  Administration.
  129         (l)(m) “Vested” or “vesting” means the guarantee that a
  130  participant is eligible to receive a retirement benefit upon
  131  completion of the required years of service under the Public
  132  Employee optional retirement program.
  134         (e) After the period during which an eligible employee had
  135  the choice to elect the defined benefit program or the Public
  136  Employee optional retirement program, or the month following the
  137  receipt of the eligible employee’s plan election, if sooner, the
  138  employee shall have one opportunity, at the employee’s
  139  discretion, to choose to move from the defined benefit program
  140  to the Public Employee optional retirement program or from the
  141  Public Employee optional retirement program to the defined
  142  benefit program. Eligible employees may elect to move between
  143  Florida Retirement System programs only if they are earning
  144  service credit in an employer-employee relationship consistent
  145  with the requirements under s. 121.021(17)(b), excluding leaves
  146  of absence without pay. Effective July 1, 2005, such elections
  147  are shall be effective on the first day of the month following
  148  the receipt of the election by the third-party administrator and
  149  are not subject to the requirements regarding an employer
  150  employee relationship or receipt of contributions for the
  151  eligible employee in the effective month, except that the
  152  employee must meet the conditions of the previous sentence when
  153  the election is received by the third-party administrator. This
  154  paragraph is shall be contingent upon approval from the Internal
  155  Revenue Service for including the choice described herein within
  156  the programs offered by the Florida Retirement System.
  157         1. If the employee chooses to move to the Public Employee
  158  optional retirement program, the applicable provisions of this
  159  section shall govern the transfer.
  160         2. If the employee chooses to move to the defined benefit
  161  program, the employee must transfer from his or her Public
  162  Employee optional retirement program account, and from other
  163  employee moneys as necessary, a sum representing the present
  164  value of that employee’s accumulated benefit obligation
  165  immediately following the time of such movement, determined
  166  assuming that attained service equals the sum of service in the
  167  defined benefit program and service in the Public Employee
  168  optional retirement program. Benefit commencement occurs on the
  169  first date the employee is would become eligible for unreduced
  170  benefits, using the discount rate and other relevant actuarial
  171  assumptions that were used to value the Florida Retirement
  172  System defined benefit plan liabilities in the most recent
  173  actuarial valuation. For any employee who, at the time of the
  174  second election, already maintains an accrued benefit amount in
  175  the defined benefit program plan, the then-present value of the
  176  such accrued benefit shall be deemed part of the required
  177  transfer amount described in this subparagraph. The division
  178  shall ensure that the transfer sum is prepared using a formula
  179  and methodology certified by an enrolled actuary.
  180         3. Notwithstanding subparagraph 2., an employee who chooses
  181  to move to the defined benefit program and who became eligible
  182  to participate in the Public Employee optional retirement
  183  program by reason of employment in a regularly established
  184  position with a state employer after June 1, 2002; a district
  185  school board employer after September 1, 2002; or a local
  186  employer after December 1, 2002, must transfer from his or her
  187  Public Employee optional retirement program account and, from
  188  other employee moneys as necessary, a sum representing the that
  189  employee’s actuarial accrued liability.
  190         4. An employee’s Employees’ ability to transfer from the
  191  Florida Retirement System defined benefit program to the Public
  192  Employee optional retirement program pursuant to paragraphs (a)
  193  (d), and the ability of a for current employee employees to have
  194  an option to later transfer back into the defined benefit
  195  program under subparagraph 2., shall be deemed a significant
  196  system amendment. Pursuant to s. 121.031(4), any such resulting
  197  unfunded liability arising from actual original transfers from
  198  the defined benefit program to the optional program must shall
  199  be amortized within 30 plan years as a separate unfunded
  200  actuarial base independent of the reserve stabilization
  201  mechanism defined in s. 121.031(3)(f). For the first 25 years, a
  202  no direct amortization payment may not shall be calculated for
  203  this base. During this 25-year period, the such separate base
  204  shall be used to offset the impact of employees exercising their
  205  second program election under this paragraph. It is the
  206  legislative intent of the Legislature that the actuarial funded
  207  status of the Florida Retirement System defined benefit program
  208  not be affected plan is neither beneficially nor adversely
  209  impacted by such second program elections in any significant
  210  manner, after due recognition of the separate unfunded actuarial
  211  base. Following the this initial 25-year period, any remaining
  212  balance of the original separate base shall be amortized over
  213  the remaining 5 years of the required 30-year amortization
  214  period.
  215         5. If the employee chooses to transfer from the optional
  216  retirement program to the defined benefit program, and retains
  217  an excess account balance in the optional program after
  218  satisfying the buy-in requirements under this paragraph, the
  219  excess may not be distributed until the member retires from the
  220  defined benefit program. The excess account balance may be
  221  rolled over to the defined benefit program and used to purchase
  222  service credit or upgrade creditable service in that program.
  223         (6) VESTING REQUIREMENTS.—
  224         (a)1. With respect to employer contributions paid on behalf
  225  of the participant to the Public Employee optional retirement
  226  program, plus interest and earnings thereon and less investment
  227  fees and administrative charges, a participant is shall be
  228  vested after completing 1 work year, as defined in s.
  229  121.021(54), with an employer, including any service while the
  230  participant was a member of the defined benefit retirement
  231  program or an optional retirement program authorized under s.
  232  121.051(2)(c) or s. 121.055(6).
  233         2. If the participant terminates employment before prior to
  234  satisfying the vesting requirements, the nonvested accumulation
  235  must shall be transferred from the participant’s accounts to the
  236  state board for deposit and investment by the state board in the
  237  suspense account created within of the Public Employee Optional
  238  Retirement Program Trust Fund of the board. If the terminated
  239  participant is reemployed as an eligible employee within 5
  240  years, the state board shall transfer to the participant’s
  241  account any amount of the moneys previously transferred from the
  242  participant’s accounts to the suspense account of the Public
  243  Employee Optional Retirement Program Trust Fund, plus the actual
  244  earnings on such amount while in the suspense account.
  245         (b)1. With respect to amounts transferred from the defined
  246  benefit program to the investment program, plus interest and
  247  earnings, and less investment fees and administrative charges, a
  248  participant shall be vested in the amount transferred from the
  249  defined benefit program, plus interest and earnings thereon and
  250  less administrative charges and investment fees, upon meeting
  251  the service requirements for the participant’s membership class
  252  as set forth in s. 121.021(29). The third-party administrator
  253  shall account for such amounts for each participant. The
  254  division shall notify the participant and the third-party
  255  administrator when the participant has satisfied the vesting
  256  period for Florida Retirement System purposes.
  257         2. If the participant terminates employment before prior to
  258  satisfying the vesting requirements, the nonvested accumulation
  259  must shall be transferred from the participant’s accounts to the
  260  state board for deposit and investment by the board in the
  261  suspense account created within of the Public Employee Optional
  262  Retirement Program Trust Fund of the board. If the terminated
  263  participant is reemployed as an eligible employee within 5
  264  years, the state board shall transfer to the participant’s
  265  account any amount of the moneys previously transferred from the
  266  participant’s accounts to the suspense account of the Public
  267  Employee Optional Retirement Program Trust Fund, plus the actual
  268  earnings on such amount while in the suspense account.
  269         (c) Any nonvested accumulations transferred from a
  270  participant’s account to the suspense account shall be forfeited
  271  by the participant if the participant is not reemployed as an
  272  eligible employee within 5 years after termination.
  274         (a) The Public Employee optional retirement program shall
  275  be administered by the state board and affected employers. The
  276  board may is authorized to require oaths, by affidavit or
  277  otherwise, and acknowledgments from persons in connection with
  278  the administration of its statutory duties and responsibilities
  279  for this program under this chapter. An No oath, by affidavit or
  280  otherwise, may not shall be required of an employee participant
  281  at the time of enrollment election. Acknowledgment of an
  282  employee’s election to participate in the program shall be no
  283  greater than necessary to confirm the employee’s election. The
  284  state board shall adopt rules to carry out its statutory duties
  285  with respect to administering the optional retirement program,
  286  including, but not limited to, establishing the roles role and
  287  responsibilities of affected state, local government, and
  288  education-related employers, the state board, the department,
  289  and third-party contractors in administering the Public Employee
  290  optional retirement program. The department shall adopt rules
  291  necessary to administer implement the optional program in
  292  coordination with the defined benefit retirement program and the
  293  disability benefits available under the optional program.
  294         (g) The state board shall develop procedures to receive and
  295  resolve participant complaints against the program, the third
  296  party administrator, or any program vendor or provider and shall
  297  resolve any conflict between the third-party administrator and
  298  an approved provider if when such conflict threatens the
  299  implementation or administration of the program or the quality
  300  of services to employees, and may resolve any other conflicts.
  301  The third-party administrator shall retain all participant
  302  records for at least 5 years for use in resolving any
  303  participant conflicts. The state board, the third-party
  304  administrator, or a provider is not required to produce
  305  documentation or an audio recording to justify action taken with
  306  regard to a participant if the action occurred 5 or more years
  307  before the complaint is submitted to the board. It is presumed
  308  that all action taken 5 or more years before the complaint is
  309  submitted was taken at the request of the participant and with
  310  the participant’s full knowledge and consent. To overcome this
  311  presumption, the participant must present documentary evidence
  312  or an audio recording demonstrating otherwise.
  313         Section 2. Subsection (3) is added to section 121.4502,
  314  Florida Statutes, to read:
  315         121.4502 Public Employee Optional Retirement Program Trust
  316  Fund.—
  317         (3) A forfeiture account shall be created within the Public
  318  Employee Optional Retirement Program Trust Fund to hold the
  319  assets derived from the forfeiture of benefits by participants.
  320  Pursuant to a private letter ruling from the Internal Revenue
  321  Service, the forfeiture account may be used only for paying
  322  expenses of the Public Employee Optional Retirement Program and
  323  reducing future employer contributions to the program.
  324  Consistent with Rulings 80-155 and 74-340 of the Internal
  325  Revenue Service, unallocated reserves within the forfeiture
  326  account must be used as quickly and as prudently as possible
  327  considering the state board’s fiduciary duty. Expected
  328  withdrawals from the account must endeavor to reduce the account
  329  to zero each fiscal year.
  330         Section 3. Paragraph (b) of subsection (1) of section
  331  121.591, Florida Statutes, is amended to read:
  332         121.591 Benefits payable under the Public Employee Optional
  333  Retirement Program of the Florida Retirement System.—Benefits
  334  may not be paid under this section unless the member has
  335  terminated employment as provided in s. 121.021(39)(a) or is
  336  deceased and a proper application has been filed in the manner
  337  prescribed by the state board or the department. The state board
  338  or department, as appropriate, may cancel an application for
  339  retirement benefits when the member or beneficiary fails to
  340  timely provide the information and documents required by this
  341  chapter and the rules of the state board and department. In
  342  accordance with their respective responsibilities as provided
  343  herein, the State Board of Administration and the Department of
  344  Management Services shall adopt rules establishing procedures
  345  for application for retirement benefits and for the cancellation
  346  of such application when the required information or documents
  347  are not received. The State Board of Administration and the
  348  Department of Management Services, as appropriate, are
  349  authorized to cash out a de minimis account of a participant who
  350  has been terminated from Florida Retirement System covered
  351  employment for a minimum of 6 calendar months. A de minimis
  352  account is an account containing employer contributions and
  353  accumulated earnings of not more than $5,000 made under the
  354  provisions of this chapter. Such cash-out must either be a
  355  complete lump-sum liquidation of the account balance, subject to
  356  the provisions of the Internal Revenue Code, or a lump-sum
  357  direct rollover distribution paid directly to the custodian of
  358  an eligible retirement plan, as defined by the Internal Revenue
  359  Code, on behalf of the participant. If any financial instrument
  360  issued for the payment of retirement benefits under this section
  361  is not presented for payment within 180 days after the last day
  362  of the month in which it was originally issued, the third-party
  363  administrator or other duly authorized agent of the State Board
  364  of Administration shall cancel the instrument and credit the
  365  amount of the instrument to the suspense account of the Public
  366  Employee Optional Retirement Program Trust Fund authorized under
  367  s. 121.4501(6). Any such amounts transferred to the suspense
  368  account are payable upon a proper application, not to include
  369  earnings thereon, as provided in this section, within 10 years
  370  after the last day of the month in which the instrument was
  371  originally issued, after which time such amounts and any
  372  earnings thereon shall be forfeited. Any such forfeited amounts
  373  are assets of the Public Employee Optional Retirement Program
  374  Trust Fund and are not subject to the provisions of chapter 717.
  375         (1) NORMAL BENEFITS.—Under the Public Employee Optional
  376  Retirement Program:
  377         (b) If a participant elects to receive his or her benefits
  378  upon termination of employment as defined in s. 121.021, the
  379  participant must submit a written application or an application
  380  by electronic means an equivalent form to the third-party
  381  administrator indicating his or her preferred distribution date
  382  and selecting an authorized method of distribution as provided
  383  in paragraph (c). The participant may defer receipt of benefits
  384  until he or she chooses to make such application, subject to
  385  federal requirements.
  386         Section 4. Section 121.74, Florida Statutes, is amended to
  387  read:
  388         121.74 Administrative and educational expenses.—In addition
  389  to contributions required under s. 121.71, effective July 1,
  390  2010, through June 30, 2014, employers participating in the
  391  Florida Retirement System shall contribute an amount equal to
  392  0.03 0.05 percent of the payroll reported for each class or
  393  subclass of Florida Retirement System membership; effective July
  394  1, 2014, the contribution rate shall be 0.04 percent of the
  395  payroll reported for each class or subclass of membership. The,
  396  which amount contributed shall be transferred by the Division of
  397  Retirement from the Florida Retirement System Contributions
  398  Clearing Trust Fund to the State Board of Administration’s
  399  Administrative Trust Fund to offset the costs of administering
  400  the optional retirement program and the costs of providing
  401  educational services to participants in the defined benefit
  402  program and the optional retirement program. Approval of the
  403  trustees of the State Board of Administration is required before
  404  prior to the expenditure of these funds. Payments for third
  405  party administrative or educational expenses shall be made only
  406  pursuant to the terms of the approved contracts for such
  407  services.
  408         Section 5. Subsection (3) of section 121.78, Florida
  409  Statutes, is amended to read:
  410         121.78 Payment and distribution of contributions.—
  411         (3)(a) Employer contributions and accompanying payroll data
  412  received after the 5th working day of the month are shall be
  413  considered late. The employer shall be assessed by the Division
  414  of Retirement a penalty of 1 percent of the contributions due
  415  for each calendar month or part thereof that the contributions
  416  or accompanying payroll data are late. Proceeds from the 1
  417  percent assessment against contributions made on behalf of
  418  participants of the defined benefit program shall be deposited
  419  in the Florida Retirement System Trust Fund, and proceeds from
  420  the 1-percent assessment against contributions made on behalf of
  421  participants of the optional retirement program shall be
  422  transferred to the third-party administrator for deposit into
  423  participant accounts, as provided in paragraph (b).
  424         (b) If contributions made by an employer on behalf of
  425  participants of the optional retirement program or accompanying
  426  payroll data are not received within the calendar month they are
  427  due, including, but not limited to, contribution adjustments as
  428  a result of employer errors or corrections, and if that
  429  delinquency results in market losses to participants, the
  430  employer shall reimburse each participant’s account for market
  431  losses resulting from the late contributions. If a participant
  432  has terminated employment and taken a distribution, the
  433  participant is responsible for returning any excess
  434  contributions erroneously provided by employers, adjusted for
  435  any investment gain or loss incurred during the period such
  436  excess contributions were in the participant’s Public Employee
  437  Optional Retirement Program account. The state board of
  438  Administration or its designated agent shall communicate to
  439  terminated participants any obligation to repay such excess
  440  contribution amounts. However, the state board of
  441  Administration, its designated agents, the Public Employee
  442  Optional Retirement Program Trust Fund, the department of
  443  Management Services, or the Florida Retirement System Trust Fund
  444  may shall not incur any loss or gain as a result of an
  445  employer’s correction of such excess contributions. The third
  446  party administrator, hired by the state board pursuant to s.
  447  121.4501(8), shall calculate the market losses for each affected
  448  participant. If When contributions made on behalf of
  449  participants of the optional retirement program or accompanying
  450  payroll data are not received within the calendar month due, the
  451  employer shall also pay the cost of the third-party
  452  administrator’s calculation and reconciliation adjustments
  453  resulting from the late contributions. The third-party
  454  administrator shall notify the employer of the results of the
  455  calculations and the total amount due from the employer for such
  456  losses and the costs of calculation and reconciliation. The
  457  employer shall remit to the Division of Retirement the amount
  458  due within 30 10 working days after the date of the penalty
  459  notice sent by the division. The division shall transfer that
  460  said amount to the third-party administrator, which who shall
  461  deposit proceeds from the 1-percent assessment and from
  462  individual market losses into participant accounts, as
  463  appropriate. The state board may is authorized to adopt rules to
  464  administer implement the provisions regarding late
  465  contributions, late submission of payroll data, the process for
  466  reimbursing participant accounts for resultant market losses,
  467  and the penalties charged to the employers.
  468         (c) Delinquency fees may be waived by the Division of
  469  Retirement, with regard to defined benefit program
  470  contributions, and by the state board of Administration, with
  471  regard to optional retirement program contributions, only if
  472  when, in the opinion of the division or the board, as
  473  appropriate, exceptional circumstances beyond the employer’s
  474  control prevented remittance by the prescribed due date
  475  notwithstanding the employer’s good faith efforts to effect
  476  delivery. Such a waiver of delinquency may be granted an
  477  employer only once one time each state fiscal year.
  478         (d) If contributions made by an employer on behalf of
  479  participants in the optional retirement program are delayed in
  480  posting to participant accounts due to acts of God beyond the
  481  control of the Division of Retirement, the state board, or the
  482  third-party administrator, as applicable, market losses
  483  resulting from the late contributions are not payable to the
  484  participants.
  485         Section 6. Subsection (1) of section 215.44, Florida
  486  Statutes, is amended to read:
  487         215.44 Board of Administration; powers and duties in
  488  relation to investment of trust funds.—
  489         (1) Except as when otherwise specifically provided by the
  490  State Constitution and subject to any limitations of the trust
  491  agreement relating to a trust fund, the Board of Administration,
  492  hereinafter sometimes referred to as “board,” composed of the
  493  Governor as chair, the Chief Financial Officer, and the Attorney
  494  General, shall invest all the funds in the System Trust Fund, as
  495  defined in s. 121.021(36), and all other funds specifically
  496  required by law to be invested by the board pursuant to ss.
  497  215.44-215.53 to the fullest extent that is consistent with the
  498  cash requirements, trust agreement, and investment objectives of
  499  the fund.
  500         (a) Notwithstanding any other law to the contrary, the
  501  State Board of Administration may invest any funds of any state
  502  agency, any state university or college, or any unit of local
  503  government, or any direct-support organization thereof pursuant
  504  to the terms of a trust agreement with the head or governing
  505  body of the respective entity the state agency or the governing
  506  body of the unit of local government, or pursuant to the
  507  enrollment requirements stated in s. 218.407, including
  508  investing such funds in the Local Government Surplus Funds Trust
  509  Fund established by s. 218.405. which trust agreement shall
  510  govern the investment of such funds, provided that
  511         (b) The board shall approve the undertaking of investments
  512  subject to a trust agreement such investment before execution of
  513  the trust agreement by the State Board of Administration. The
  514  funds and the earnings therefrom are exempt from the service
  515  charge imposed by s. 215.20.
  516         (c) As used in this subsection, the term “state agency” has
  517  the same meaning as that provided in s. 216.011(1) 216.001, and
  518  the terms “governing body” and “unit of local government” have
  519  the same meaning as that provided in s. 218.403.
  520         Section 7. Paragraphs (b) and (c) of subsection (1),
  521  paragraph (a) of subsection (2), and subsection (5) of section
  522  215.47, Florida Statutes, are amended, and paragraph (o) is
  523  added to subsection (1) of that section, to read:
  524         215.47 Investments; authorized securities; loan of
  525  securities.—Subject to the limitations and conditions of the
  526  State Constitution or of the trust agreement relating to a trust
  527  fund, moneys available for investments under ss. 215.44-215.53
  528  may be invested as follows:
  529         (1) Without limitation in:
  530         (b) State Bonds, notes, or obligations of any state,
  531  organized territory of the United States, or the District of
  532  Columbia which pledge pledging the full faith and credit of the
  533  state, territory, or district; and revenue bonds, notes, or
  534  obligations of any state, organized territory of the United
  535  States, or the District of Columbia additionally secured by the
  536  full faith and credit of the state, territory, or district.
  537         (c) Bonds, notes, or obligations of the several counties or
  538  districts in any the state, organized territory of the United
  539  States, or the District of Columbia containing a pledge of the
  540  full faith and credit of the county or district involved.
  541         (o) Bonds, notes, or obligations described in 26 U.S.C. s.
  542  149(g)(3)(B), if investment in such bonds, notes, or obligations
  543  is necessary in order to comply with covenants in documents or
  544  proceedings relating to bonds issued pursuant to s. 215.555(6).
  545  Investments made pursuant to this paragraph may be purchased
  546  only from the proceeds of bonds issued pursuant to s. 215.555(6)
  547  and must be authorized under documents or proceedings relating
  548  to such bonds.
  549         (2) With no more than 25 percent of any fund in:
  550         (a) Bonds, notes, or obligations of any state or organized
  551  territory of the United States or the District of Columbia; of
  552  any municipality or political subdivision, or any agency,
  553  district, or authority thereof; or of any agency or authority of
  554  this state, if the obligations are rated investment grade by at
  555  least one nationally recognized statistical rating organization.
  556         (5) With no more than 35 25 percent of any fund in
  557  corporate obligations and securities of any kind of a foreign
  558  corporation or a foreign commercial entity having its principal
  559  office located in any country other than the United States of
  560  America or its possessions or territories, not including United
  561  States dollar-denominated securities listed and traded on a
  562  United States exchange which are a part of the ordinary
  563  investment strategy of the board.
  564         Section 8. Paragraph (a) of subsection (8) of section
  565  218.409, Florida Statutes, is amended to read:
  566         218.409 Administration of the trust fund; creation of
  567  advisory council.—
  568         (8)(a) The principal, and any part thereof, of each and
  569  every account constituting the trust fund is shall be subject to
  570  payment at any time from the moneys in the trust fund. However,
  571  the executive director may, in good faith, on the occurrence of
  572  an event that has a material impact on liquidity or operations
  573  of the trust fund, for 48 hours limit contributions to or
  574  withdrawals from the trust fund to ensure that the board can
  575  invest moneys entrusted to it in exercising its fiduciary
  576  responsibility. Such action must shall be immediately disclosed
  577  to all participants, the trustees, the Joint Legislative
  578  Auditing Committee, the Investment Advisory Council, and the
  579  Participant Local Government Advisory Council. The trustees
  580  shall convene an emergency meeting as soon as practicable from
  581  the time the executive director has instituted such measures and
  582  review the necessity of those measures. If the trustees are
  583  unable to convene an emergency meeting before the expiration of
  584  the 48-hour moratorium on contributions and withdrawals, the
  585  moratorium may be extended by the executive director until the
  586  trustees can meet to review the necessity for the moratorium. If
  587  the trustees agree with such measures, the trustees shall vote
  588  to continue the measures for up to an additional 15 days. The
  589  trustees must convene and vote to continue any such measures
  590  before prior to the expiration of the time limit set, but in no
  591  case may the time limit set by the trustees exceed 15 days.
  592         Section 9. Trademarks, copyrights, or patents.—The State
  593  Board of Administration, on behalf of the Florida Retirement
  594  System or any other trust fund under its jurisdiction, may
  595  develop work products that are subject to trademark, copyright,
  596  or patent statutes. The board may, in its own name or through
  597  the growth initiative program created pursuant to s. 215.47(7),
  598  Florida Statutes, or any other program developed with or for the
  599  board:
  600         (1) Perform all things necessary to secure letters of
  601  patent, copyrights, or trademarks on any work products and
  602  enforce its rights therein.
  603         (2) License, lease, assign, or otherwise give written
  604  consent to any person for the manufacture or use of its work
  605  products on a royalty basis or for such other consideration as
  606  the board deems proper.
  607         (3) Take any action necessary, including legal action, to
  608  protect its work products against improper or unlawful use of
  609  infringement.
  610         (4)Enforce the collection of any sums due to the board for
  611  the manufacture or use of its work products by any other party.
  612         (5) Sell any of its work products and execute all
  613  instruments necessary to consummate any such sale.
  614         (6) Do all other acts necessary and proper for the
  615  execution of powers and duties provided under this section.
  616         Section 10. This act shall take effect July 1, 2010.

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