The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Community Affairs
BILL: CS/SB 224
INTRODUCER: Governmental Oversight and Accountability Committee and Senator Hooper and others
SUBJECT: Special Risk Class Retirement Date
DATE: April 3, 2023 REVISED:
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Harmsen McVaney GO Fav/CS
2. Hackett Ryon CA Favorable
3. AP
Please see Section IX. for Additional Information:
COMMITTEE SUBSTITUTE - Substantial Changes
I. Summary:
CS/SB 224 modifies the normal retirement date for a Special Risk Class member enrolled in the
Florida Retirement System (FRS). Currently, a special risk class member who enrolled in the
Florida Retirement System before July 1, 2011, reaches his or her normal retirement date, at
which the member may receive full retirement benefits from their chosen FRS retirement plan, at
either age 55 or after 25 years of service—whichever comes first. However, Special Risk Class
members who enrolled on or after July 1, 2011, reach their normal retirement date at either age
60, or after 30 years of service—whichever comes first. This bill lowers the age or service
requirement for the normal retirement date for special risk class personnel who enrolled after
July 1, 2011. This allows all Special Risk Class members to receive full retirement benefits at
either age 55, or after 25 years of service, whether or not they enrolled after July 1, 2011.
With the earlier normal retirement date, some Special Risk Class members will have worked
beyond the date upon which those members must enroll in the Deferred Option Retirement
Program or be deemed ineligible to participate. The bill allows those members to enroll in DROP
within 12 months of the effective date of this bill.
The bill is expected to have a significant fiscal impact on state and local governments that
employ members of the Special Risk Class of the FRS; the bill increases employer contributions
by $77.5 million annually system-wide to fund the benefit changes.
The bill takes effect July 1, 2023.
BILL: CS/SB 224 Page 2
II. Present Situation:
The Florida Retirement System (FRS)
The Florida Retirement System (FRS) was established in 1970 when the Legislature consolidated
the Teachers’ Retirement System, the State and County Officers and Employees’ Retirement
System, and the Highway Patrol Pension Fund. In 1972, the Judicial Retirement System was
consolidated into the FRS, and in 2007, the Institute of Food and Agricultural Sciences
Supplemental Retirement Program was consolidated under the Regular Class of the FRS as a
closed group.1 The FRS is a contributory system, with active members contributing 3 percent of
their salaries.2
The FRS is a multi-employer plan, governed by ch. 121, F.S., the “Florida Retirement System
Act.” As of June 30, 2022, the FRS had 629,073 active non-retired members, 448,846 annuitants,
14,858 disabled retirees, and 28,827 active participants of the Deferred Retirement Option
Program (DROP).3 As of September 2022, the FRS consisted of 990 total employers; it is the
primary retirement plan for employees of state and county government agencies, district school
boards, Florida College institutions, and state universities, and includes the 180 cities and 153
special districts that have elected to join the system.4
The membership of the FRS is divided into five membership classes:
 The Regular Class5 consists of 537,128 active members and 7,806 in renewed membership;
 The Special Risk Class6 includes 72,925 active members and 1,100 in renewed membership;
 The Special Risk Administrative Support Class7 has 104 active members and one in renewed
membership;
 The Elected Officers’ Class8 has 2,075 active members and 109 in renewed membership; and
1
Florida Department of Management Services (DMS), Division of Retirement, Florida Retirement System Pension Plan and
Other State Administered Retirement Systems FY 2021-22 Annual Comprehensive Financial Report, 35, available at
https://employer.frs.fl.gov/forms/2020-21_ACFR.pdf. (last visited Mar. 31, 2023).
2
Prior to 1975, members of the FRS were required to make employee contributions of either 4 percent for Regular Class
employees or 6 percent for Special Risk Class members. Employees were again required to contribute to the system after
July 1, 2011. See, ch. 2011-68, s. 33, Laws of Fla. Members in the Deferred Retirement Option Program do not contribute to
the system.
3
Supra, n. 1 at 260.
4
DMS, Division of Retirement, Participating Employers for Fiscal Year 2022-2023 (Sept. 2022), available at
https://employer.frs.fl.gov/forms/part-emp.pdf (last visited Mar. 31, 2023).
5
The Regular Class is for all members who are not assigned to another class. Section 121.021(12), F.S.
6
The Special Risk Class is for members employed as law enforcement officers, firefighters, correctional officers, probation
officers, paramedics and emergency technicians, among others. Section 121.0515, F.S.
7
The Special Risk Administrative Support Class is for a special risk member who moved or was reassigned to a nonspecial
risk law enforcement, firefighting, correctional, or emergency medical care administrative support position with the same
agency, or who is subsequently employed in such a position under the Florida Retirement System. Section 121.0515(8), F.S.
8
The Elected Officers’ Class includes elected state and county officers, and those elected municipal or special district
officers whose governing body has chosen Elected Officers’ Class participation for its elected officers. Section 121.052, F.S.
BILL: CS/SB 224 Page 3
 The Senior Management Service Class9 has 7,610 active members and 210 in renewed
membership.10
Each class is funded separately based upon the costs attributable to the members of that class.
Members of the FRS have two primary plan options available for participation:11
 The defined contribution plan, also known as the Investment Plan; and
 The defined benefit plan, also known as the Pension Plan.
Investment Plan
In 2000, the Public Employee Optional Retirement Program (investment plan) was created as a
defined contribution plan offered to eligible employees as an alternative to the FRS Pension
Plan.12
Benefits under the investment plan accrue in individual member accounts funded by both
employee and employer contributions and earnings. Benefits are provided through employee-
directed investments offered by approved investment providers.13
A member vests immediately in all employee contributions paid to the investment plan.14 With
respect to the employer contributions, a member vests after completing one work year of
employment with an FRS employer.15 Vested benefits are payable upon termination or death as a
lump-sum distribution, direct rollover distribution, or periodic distribution.16 The investment
plan also provides disability coverage for both in-line-of-duty and regular disability retirement
benefits.17 An FRS member who qualifies for disability while enrolled in the investment plan
may apply for benefits as if the employee were a member of the pension plan. If approved for
retirement disability benefits, the member is transferred to the pension plan.18
9
The Senior Management Service Class is for members who fill senior management level positions assigned by law to the
Senior Management Service Class or authorized by law as eligible for Senior Management Service designation. Section
121.055, F.S.
10
All figures are from Florida Retirement System Pension Plan and Other State Administered Retirement Systems FY 2021-
22 Annual Comprehensive Financial Report, at 263.
11
Florida State Board of Administration (SBA), Plan Comparison Chart (Jul. 2020), available at
https://www.myfrs.com/pdf/forms/plancomparison.pdf (last visited Mar. 31, 2023).
12
See, ch. 2000-169, Laws of Fla.
13
Section 121.4501(1), F.S.
14
Section 121.4501(6)(a), F.S.
15
If a member terminates employment before vesting in the investment plan, the nonvested money is transferred from the
member’s account to the SBA for deposit and investment by the SBA in its suspense account for up to five years. If the
member is not reemployed as an eligible employee within five years, any nonvested accumulations transferred from a
member’s account to the SBA’s suspense account are forfeited. Section 121.4501(6)(b)-(d), F.S.
16
Section 121.591, F.S.
17
See s. 121.4501(16), F.S.
18
Pension plan disability retirement benefits, which apply for investment plan members who qualify for disability,
compensate a line-of-duty disabled member up to 65 percent of the average monthly compensation as of the disability
retirement date for special risk class members. Other members may receive up to 42 percent of the member’s average
monthly compensation for disability retirement benefits. If the disability occurs other than in the line-of-duty, the monthly
benefit may not be less than 25 percent of the average monthly compensation as of the disability retirement date.
Section 121.091(4)(f), F.S.
BILL: CS/SB 224 Page 4
The State Board of Administration (SBA) is primarily responsible for administering the
investment plan.19 The Board of Trustees of the SBA is comprised of the Governor as chair, the
Chief Financial Officer, and the Attorney General.20
Pension Plan
The pension plan is administered by the Secretary of Management Services (DMS) through the
Division of Retirement.21 The SBA manages the pension fund’s assets.22
Any member initially enrolled in the pension plan before July 1, 2011, vests in the pension plan
after completing six years of service with an FRS employer.23 For members initially enrolled on
or after July 1, 2011, the member vests in the pension plan after eight years of creditable
service.24 Benefits payable under the pension plan are calculated based on the member’s years of
creditable service multiplied by the service accrual rate multiplied by the member’s average final
compensation.25
For most current members of the pension plan, normal retirement (when first eligible for
unreduced benefits) occurs at the earliest attainment of 30 years of service or age 62.26 For public
safety employees in the Special Risk and Special Risk Administrative Support Classes, normal
retirement is the earliest of 25 years of service or age 55.27 Members initially enrolled in the
pension plan on or after July 1, 2011, have longer service requirements. For members initially
enrolled after that date, the member must complete 33 years of service or attain age 65; members
in the Special Risk classes must complete 30 years of service or attain age 60.28
Deferred Retirement Option Program (DROP)
Members who retire from the FRS pension plan are eligible to enroll in the DROP, which allows
a member to continue employment with an FRS employer for up to 60 additional months.29
While in the DROP, the member’s retirement benefits accumulate in the FRS Trust Fund
increased by a cost-of-living adjustment (COLA) each July and earn monthly interest equivalent
to an annual rate of 1.30 percent on the preceding month’s DROP accumulation until termination
of participation in the DROP.30
19
Section 121.4501(8), F.S.
20
FLA. CONST. art. IV, s. 4.
21
Section 121.025, F.S.
22
Florida SBA, Summary Overview of the State Board of Administration of Florida, 4, available at
https://www.sbafla.com/fsb/Portals/FSB/Content/Topics/SBAOverview_20211025.pdf?ver=2021-10-28-120954-217 (last
visited Mar. 31, 2023).
23
Section 121.021(45)(a), F.S.
24
Section 121.021(45)(b), F.S.
25
Section 121.091, F.S. See also, Florida Retirement System Pension Plan and Other State Administered Retirement Systems
FY 2021-22 Annual Comprehensive Financial Report, 35-37, supra at 1.
26
Section 121.021(29)(a)1., F.S.
27
Section 121.021(29)(b)1., F.S.
28
Sections 121.021(29)(a)2. and (b)2., F.S.
29
Section 121.091(13), F.S.
30
Florida Retirement System Pension Plan and Other State Administered Retirement Systems FY 2021-22 Annual
Comprehensive Financial Report, supra note 1 at pp. 38-39.
BILL: CS/SB 224 Page 5
Generally, eligible FRS pension plan members must elect to participate in the DROP within 12
months of their normal retirement date.31 However, a member initially enrolled in the FRS before
July 1, 2011, who reaches normal retirement date based on years of service before he or she
reaches age 62 (or age 55 for special risk class members) may defer his or her entry into DROP
until 12 months immediately following their 57th birthday, or 52nd birthday for special risk class
members. A member who enrolled in the FRS pension plan on or after July 1, 2011, and who
reaches normal retirement date based on service before age 65, (or 60 for special risk class) may
defer DROP participation until the 12 months immediately following his or her 60th birthday, or
55th birthday for special risk class.32
K-12 instructional personnel employed with an FRS employer may extend their DROP
participation for up to an additional 36 months, for a total of 8 years of DROP participation.
Administrative personnel who are employed with a K-12 FRS employer may extend his or her
DROP participation through the end of the current school year.33
Similarly, law enforcement officers who are in the special risk class,34 who elect to participate in
DROP on or after July 1, 2022, may participate in DROP for an additional 36 calendar months
beyond the 60-month DROP period, for a total of 8 years enrollment in the DROP. To qualify,
the participant must enter DROP on or before June 30, 2028.35
The Special Risk Class of the FRS
The Special Risk Class of the FRS consists of state and local government employees who meet
the criteria for special risk membership. The class covers persons employed in law enforcement,
firefighting, criminal detention, and emergency and forensic medical care who meet statutory
criteria for membership as set forth in s. 121.0515, F.S.
When originally establishing the Special Risk Class of membership in the FRS, the Legislature
recognized that persons employed in certain categories of positions:
[A]re required to perform work that is physically demanding or arduous, or
work that requires extraordinary agility and mental acuity, and that such
persons, because of diminishing physical and mental faculties, may find that
they are not able, without risk to the health and safety of themselves, the
public, or their coworkers, to continue performing such duties and thus
enjoy the full career and retirement benefits enjoyed by persons employed
in other membership classes and that, if they find it necessary, due to the
physical and mental limitations of their age, to retire at an earlier age and
usually with less service, they will suffer an economic deprivation
therefrom.36
31
Section 121.091(13)(a), F.S.
32
Section 121.091(13)(a)2., F.S.
33
Section 121.091(13)(b)1., F.S.
34
See, s. 121.0515(3)(a), F.S. This is a narrow permission that excludes sheriffs and elected police chiefs and does not
encompass the special risk class as a whole.
35
Section 121.091(13)(c), F.S.
36
Section 121.0515(1), F.S.
BILL: CS/SB 224 Page 6
Compared to Regular Class members, a person who is a member in the Special Risk Class of the
FRS pension plan earns a higher annual service accrual rate, may retire at an earlier age and is
eligible to receive higher disability and death benefits. As a result, the contribution rate to fund
the normal cost of the Special Risk benefits is higher than the contribution rates to fund the
normal cost of the Regular Class benefits. Similarly, the contribution rate to fund the unfunded
liabilities of the Special Risk Class is higher than the same type contribution rate for the Regular
Class. Special Risk Class members of the FRS investment plan receive total contributions into
the individual investment accounts equal to 17 percent of salary. A Regular Class member
receives total contributions equal to 9.3 percent of salary.37
The table below shows the contribution rates for the Regular Cl