Bill Summary – FastDemocracy

       Florida Senate - 2024                                    SB 1022
       
       
        
       By Senator Rodriguez
       
       
       
       
       
       40-01354A-24                                          20241022__
                      A bill to be entitled                      
       An act relating to pension plan election under the
       Florida Retirement System; amending s. 121.4501, F.S.;
       authorizing certain eligible employees participating
       in the Florida Retirement System to make a second
       election to move back to the pension plan; requiring
       the Division of Retirement to notify employees
       eligible to make such election by a specified date;
       providing requirements for such election; providing
       that the cost of such election is deferred until the
       member’s retirement; authorizing that such cost be
       amortized over a certain period of time; prohibiting
       such cost from exceeding a specified percentage of the
       member’s retirement benefits; conforming cross
       references; amending s. 121.122, F.S.; conforming
       cross-references; providing an effective date.
        
Be It Enacted by the Legislature of the State of Florida:

       Section 1. Paragraphs (a) and (b) of subsection (4) of
section 121.4501, Florida Statutes, are amended, and paragraph
(g) is added to that subsection, to read:
       121.4501 Florida Retirement System Investment Plan.—
       (4) PARTICIPATION; ENROLLMENT.—
       (a)1. Effective June 1, 2002, through February 28, 2003, a
90-day election period was provided to each eligible employee
participating in the Florida Retirement System, preceded by a
90-day education period, permitting each eligible employee to
elect membership in the investment plan. An employee who failed
to elect the investment plan during the election period remained
in the pension plan. An eligible employee who was employed in a
regularly established position during the election period was
granted the option to make one subsequent election, as provided
in paragraphs (f) and (g) paragraph (f). With respect to an
eligible employee who did not participate in the initial
election period or who is initially employed in a regularly
established position after the close of the initial election
period but before January 1, 2018, such employee shall, by
default, be enrolled in the pension plan at the commencement of
employment and may, by the last business day of the 5th month
following the employee’s month of hire, elect to participate in
the investment plan. The employee’s election must be made in
writing or by electronic means and must be filed with the third
party administrator. The election to participate in the
investment plan is irrevocable, except as provided in paragraphs
(f) and (g) paragraph (f).
       a. If the employee files such election within the
prescribed time period, enrollment in the investment plan is
effective on the first day of employment. The retirement
contributions paid through the month of the employee plan change
shall be transferred to the investment program, and, effective
the first day of the next month, the employer and employee must
pay the applicable contributions based on the employee
membership class in the program.
       b. An employee who fails to elect to participate in the
investment plan within the prescribed time period is deemed to
have elected to retain membership in the pension plan, and the
employee’s option to elect to participate in the investment plan
is forfeited.
       2. With respect to employees who become eligible to
participate in the investment plan pursuant to s.
121.051(2)(c)3. or s. 121.35(3)(i), the employee may elect to
participate in the investment plan in lieu of retaining his or
her membership in the State Community College System Optional
Retirement Program or the State University System Optional
Retirement Program. The election must be made in writing or by
electronic means and must be filed with the third-party
administrator. This election is irrevocable, except as provided
in paragraphs (f) and (g) paragraph (f). Upon making such
election, the employee shall be enrolled as a member in the
investment plan, the employee’s membership in the Florida
Retirement System is governed by the provisions of this part,
and the employee’s participation in the State Community College
System Optional Retirement Program or the State University
System Optional Retirement Program terminates. The employee’s
enrollment in the investment plan is effective on the first day
of the month for which a full month’s employer and employee
contribution is made to the investment plan.
       (b)1. With respect to employees who become eligible to
participate in the investment plan by reason of employment in a
regularly established position commencing on or after January 1,
2018, or who did not complete an election window before January
1, 2018, any such employee shall be enrolled in the pension plan
at the commencement of employment and may, by the last business
day of the eighth month following the employee’s month of hire,
elect to participate in the pension plan or the investment plan.
Eligible employees may make a plan election only if they are
earning service credit in an employer-employee relationship
consistent with s. 121.021(17)(b), excluding leaves of absence
without pay.
       2. The employee’s election must be made in writing or by
electronic means and must be filed with the third-party
administrator. The election to participate in the pension plan
or investment plan is irrevocable, except as provided in
paragraphs (f) and (g) paragraph (f).
       3.a. Except as provided in subparagraph 4., if the employee
fails to make an election to either the pension plan or the
investment plan during the 8-month period following the month of
hire, the employee is deemed to have elected the investment plan
and shall default into the investment plan retroactively to the
employee’s date of employment. The employee’s option to
participate in the pension plan is forfeited, except as provided
in paragraphs (f) and (g) paragraph (f).
       b. The amount of the employee and employer contributions
paid through the date of default to the investment plan shall be
transferred to the investment plan and shall be placed in a
default fund as designated by the State Board of Administration.
The employee may move the contributions once an account is
activated in the investment plan.
       4. If the employee is employed in a position included in
the Special Risk Class and fails to make an election to either
the pension plan or the investment plan during the 8-month
period following the month of hire, the employee is deemed to
have elected the pension plan and shall default into the pension
plan retroactively to the employee’s date of employment. The
employee’s option to participate in the investment plan is
forfeited, except as provided in paragraphs (f) and (g)
paragraph (f).
       5. Effective the first day of the month after an eligible
employee makes a plan election of the pension plan or investment
plan, or the first day of the month after default, the employee
and employer shall pay the applicable contributions based on the
employee membership class in the program.
       (g) Effective July 1, 2024, an eligible employee
participating in the Florida Retirement System who was enrolled
in the pension plan before 2002 and who moved to the investment
plan under paragraph (f) may choose to move back to the pension
plan while deferring the cost until retirement.
       1. Eligible employees may elect to move back to the pension
plan under this paragraph only if they are earning service
credit in an employer-employee relationship consistent with s.
121.021(17)(b), excluding leaves of absence without pay.
       2. The division shall notify employees who qualify under
this paragraph no later than July 30, 2024.
       3. The election to move back to the pension plan must be
made in writing and filed with the third-party administrator
within 90 days after an eligible employee receives notice from
the division under subparagraph 2. Such elections are effective
on the first day of the month after the receipt of the election
by the third-party administrator.
       4. The cost of moving back to the pension plan under this
paragraph is deferred until the member’s retirement. If a member
is unable to pay the deferred cost, or the member terminates his
or her employment before retirement, such cost must be amortized
over a period of 10 years beginning in the year of the member’s
retirement, not to exceed 25 percent of the member’s retirement
benefits.
       Section 2. Paragraph (j) of subsection (3), paragraph (e)
of subsection (4), and paragraph (e) of subsection (5) of
section 121.122, Florida Statutes, are amended to read:
       121.122 Renewed membership in system.—
       (3) A retiree of the investment plan, the State University
System Optional Retirement Program, the Senior Management
Service Optional Annuity Program, or the State Community College
System Optional Retirement Program who is reemployed with a
covered employer in a regularly established position on or after
July 1, 2017, shall be enrolled as a renewed member of the
investment plan unless employed in a position eligible for
participation in the State University System Optional Retirement
Program as provided in subsection (4) or the State Community
College System Optional Retirement Program as provided in
subsection (5). The renewed member must satisfy the vesting
requirements and other provisions of this chapter.
       (j) Notwithstanding s. 121.4501(4)(f) and (g) s.
121.4501(4)(f), the renewed member is not eligible to elect
membership in the pension plan.
       (4) A retiree of the investment plan, the State University
System Optional Retirement Program, the Senior Management
Service Optional Annuity Program, or the State Community College
System Optional Retirement Program who is reemployed on or after
July 1, 2017, in a regularly established position eligible for
participation in the State University System Optional Retirement
Program shall become a renewed member of the optional retirement
program. The renewed member must satisfy the vesting
requirements and other provisions of this chapter. Once
enrolled, a renewed member remains enrolled in the optional
retirement program while employed in an eligible position for
the optional retirement program. If employment in a different
covered position results in the renewed member’s enrollment in
the investment plan, the renewed member is no longer eligible to
participate in the optional retirement program unless employed
in a mandatory position under s. 121.35.
       (e) Notwithstanding s. 121.4501(4)(f) and (g) s.
121.4501(4)(f), the renewed member is not eligible to elect
membership in the pension plan.
       (5) A retiree of the investment plan, the State University
System Optional Retirement Program, the Senior Management
Service Optional Annuity Program, or the State Community College
System Optional Retirement Program who is reemployed on or after
July 1, 2017, in a regularly established position eligible for
participation in the State Community College System Optional
Retirement Program shall become a renewed member of the optional
retirement program. The renewed member must satisfy the
eligibility requirements of this chapter and s. 1012.875 for the
optional retirement program. Once enrolled, a renewed member
remains enrolled in the optional retirement program while
employed in an eligible position for the optional retirement
program. If employment in a different covered position results
in the renewed member’s enrollment in the investment plan, the
renewed member is no longer eligible to participate in the
optional retirement program.
       (e) Notwithstanding s. 121.4501(4)(f) and (g) s.
121.4501(4)(f), the renewed member is not eligible to elect
membership in the pension plan.
       Section 3. This act shall take effect July 1, 2024.