Florida 2024 Regular Session

Florida House Bill H0971 Compare Versions

Only one version of the bill is available at this time.

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10	10	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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14	14	A bill to be entitled 1
15	15	An act relating to employment after retirement of 2
16	16	school district personnel; amending s. 121.021, F.S.; 3
17	17	revising the definition of "termination" to conform to 4
18	18	changes made by the act; amending s. 121.091, F.S.; 5
19	19	establishing an exception to reemployment after 6
20	20	retirement limitations to authorize certain retired 7
21	21	staff to be employed in specified positions before 8
22	22	meeting the definition of termination; prohibiting th e 9
23	23	accrual of additional retirement service credit and 10
24	24	renewed membership during such period of reemployment; 11
25	25	amending ss. 121.122 and 121.591, F.S.; conforming 12
26	26	provisions and a cross -reference to changes made by 13
27	27	the act; requiring the State Board of Admini stration 14
28	28	and the Department of Management Services to request a 15
29	29	determination letter and private letter ruling from 16
30	30	the United States Internal Revenue Service; providing 17
31	31	for nonapplicability of the act, or portions thereof, 18
32	32	under specified circumstances; p roviding effective 19
33	33	dates. 20
34	34	21
35	35	Be It Enacted by the Legislature of the State of Florida: 22
36	36	23
37	37	Section 1. Subsection (39) of section 121.021, Florida 24
38	38	Statutes, is amended to read: 25
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47	47	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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51	51	121.021 Definitions. —The following words and phrases as 26
52	52	used in this chapter have the respective meanings set forth 27
53	53	unless a different meaning is plainly required by the context: 28
54	54	(39)(a) "Termination" occurs, except as provided in 29
55	55	paragraphs (b) and (c), when a member ceases all employment, 30
56	56	which term includes the provision o f services, with all 31
57	57	employers, however: 32
58	58	1. For retirements effective before July 1, 2010, if a 33
59	59	member is employed by any employer within the next calendar 34
60	60	month, termination shall be deemed not to have occurred. A leave 35
61	61	of absence constitutes a continua tion of the employment 36
62	62	relationship, except that a leave of absence without pay due to 37
63	63	disability may constitute termination if such member makes 38
64	64	application for and is approved for disability retirement in 39
65	65	accordance with s. 121.091(4). 40
66	66	2. For retirements effective on or after July 1, 2010, if 41
67	67	a member is employed by any employer within the next 6 calendar 42
68	68	months, termination shall be deemed not to have occurred unless 43
69	69	the member is employed following retirement in accordance with 44
70	70	s. 121.091(9)(g). A leave of absence constitutes a continuation 45
71	71	of the employment relationship, except that a leave of absence 46
72	72	without pay due to disability may constitute termination if such 47
73	73	member makes application for and is approved for disability 48
74	74	retirement in accordance wi th s. 121.091(4). 49
75	75	(b) "Termination" for a member ending participation in the 50
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84	84	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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88	88	Deferred Retirement Option Program occurs when the program 51
89	89	participant ceases all employment, which term includes the 52
90	90	provision of services, with all employers in accordance wit h s. 53
91	91	121.091(13), however: 54
92	92	1. For termination dates occurring before July 1, 2010, if 55
93	93	a member is employed by any employer within the next calendar 56
94	94	month, termination shall be deemed not to have occurred, except 57
95	95	as provided in s. 121.091(13)(b)4.c. A lea ve of absence 58
96	96	constitutes a continuation of the employment relationship. 59
97	97	2. For termination dates occurring on or after July 1, 60
98	98	2010, if a member becomes employed by any employer within the 61
99	99	next 6 calendar months, termination shall be deemed not to have 62
100	100	occurred, except as provided in s. 121.091(13)(b)4.c. or s. 63
101	101	121.091(9)(g). A leave of absence constitutes a continuation of 64
102	102	the employment relationship. 65
103	103	(c) Effective July 1, 2011, "termination" for a member 66
104	104	receiving a refund of employee contributions o ccurs when a 67
105	105	member ceases all employment, which term includes the provision 68
106	106	of services, with all employers for 3 calendar months. A leave 69
107	107	of absence constitutes a continuation of the employment 70
108	108	relationship. 71
109	109	72
110	110	All terminations must be a termination of emp loyment consistent 73
111	111	with 26 C.F.R. s. 1.409A -1(h)(1)(ii). After July 1, 2023, 74
112	112	volunteer services do not constitute employment by, or provision 75
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121	121	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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125	125	of services to, an employer. The department or state board may 76
126	126	require any evidence of termination necessary to de termine 77
127	127	compliance with this chapter or the rules adopted thereunder. 78
128	128	Section 2. Paragraphs (c) and (d) of subsection (9) of 79
129	129	section 121.091, Florida Statutes, are amended, and paragraph 80
130	130	(g) is added to that subsection, to read: 81
131	131	121.091 Benefits paya ble under the system. —Benefits may 82
132	132	not be paid under this section unless the member has terminated 83
133	133	employment as provided in s. 121.021(39)(a) or begun 84
134	134	participation in the Deferred Retirement Option Program as 85
135	135	provided in subsection (13), and a proper app lication has been 86
136	136	filed in the manner prescribed by the department. The department 87
137	137	may cancel an application for retirement benefits when the 88
138	138	member or beneficiary fails to timely provide the information 89
139	139	and documents required by this chapter and the depar tment's 90
140	140	rules. The department shall adopt rules establishing procedures 91
141	141	for application for retirement benefits and for the cancellation 92
142	142	of such application when the required information or documents 93
143	143	are not received. 94
144	144	(9) EMPLOYMENT AFTER RETIREMENT; LIMITATION.— 95
145	145	(c) Any person whose retirement is effective on or after 96
146	146	July 1, 2010, or whose participation in the Deferred Retirement 97
147	147	Option Program terminates on or after July 1, 2010, who is 98
148	148	retired under this chapter, except under the disability 99
149	149	retirement provisions of subsection (4) or as provided in s. 100
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158	158	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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162	162	121.053, may be reemployed by an employer that participates in a 101
163	163	state-administered retirement system and receive retirement 102
164	164	benefits and compensation from that employer. However, a person 103
165	165	may not be reemployed by an employer participating in the 104
166	166	Florida Retirement System before meeting the definition of 105
167	167	termination in s. 121.021 and may not receive both a salary from 106
168	168	the employer and retirement benefits for 6 calendar months after 107
169	169	meeting the definiti on of termination, except as provided in 108
170	170	paragraph (f) or paragraph (g). However, a DROP participant 109
171	171	shall continue employment and receive a salary during the period 110
172	172	of participation in the Deferred Retirement Option Program, as 111
173	173	provided in subsection (13) . 112
174	174	1. The reemployed retiree may not renew membership in the 113
175	175	Florida Retirement System, except as provided in s. 121.122. 114
176	176	2. The employer shall pay retirement contributions in an 115
177	177	amount equal to the unfunded actuarial liability portion of the 116
178	178	employer contribution that would be required for active members 117
179	179	of the Florida Retirement System in addition to the 118
180	180	contributions required by s. 121.76. 119
181	181	3. A retiree initially reemployed in violation of this 120
182	182	paragraph and an employer that employs or appoints such person 121
183	183	are jointly and severally liable for reimbursement of any 122
184	184	retirement benefits paid to the retirement trust fund from which 123
185	185	the benefits were paid, including the Florida Retirement System 124
186	186	Trust Fund and the Florida Retirement System Investment Plan 125
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195	195	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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197	197
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199	199	Trust Fund, as appropriate. The employer must have a written 126
200	200	statement from the employee that he or she is not retired from a 127
201	201	state-administered retirement system. Retirement benefits shall 128
202	202	remain suspended until repayment is made. Benefits suspended 129
203	203	beyond the end of the retiree's 6 -month reemployment limitation 130
204	204	period shall apply toward the repayment of benefits received in 131
205	205	violation of this paragraph. 132
206	206	(d) This subsection applies to retirees, as defined in s. 133
207	207	121.4501(2), of the Florida Retirement System Investment Plan, 134
208	208	subject to the following conditions: 135
209	209	1. Except as provided in subparagraph 2., a retiree may 136
210	210	not be reemployed with an employer participating in the Florida 137
211	211	Retirement System until such person has been retired for 6 138
212	212	calendar months. 139
213	213	2. A retiree may be reemployed as a substitute teacher 140
214	214	following retirement in accordance with the requirements of 141
215	215	paragraph (g). 142
216	216	3. A retiree employed in violation of this subsection and 143
217	217	an employer that employs or appoints such person are jointly and 144
218	218	severally liable for reimbursement of any benefits paid to the 145
219	219	retirement trust fund from which the benefits were paid. The 146
220	220	employer must have a written statement from the retiree that he 147
221	221	or she is not retired from a state -administered retirement 148
222	222	system. 149
223	223	(g) A district school board may reemploy a retiree to work 150
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232	232	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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236	236	as a substitute teacher or an hourly teacher or an education 151
237	237	paraprofessional as a nonemployee of the school system 1 152
238	238	calendar month following retirement or DROP termination. The 153
239	239	retiree may receive compensation from the employer and 154
240	240	retirement benefits before meeting the definition of termination 155
241	241	in s. 121.021(39). Reemployed instructional staff may not 156
242	242	receive additional retirement service credit for such employment 157
243	243	and may not renew membership in the Florida Retirement System 158
244	244	during such period of employment. 159
245	245	Section 3. Subsection (6) is added to section 121.122, 160
246	246	Florida Statutes, to read: 161
247	247	121.122 Renewed membership in system. — 162
248	248	(6) If a retiree otherwise eligible for renewed membership 163
249	249	in accordance with subsections (3), (4), and (5) is reemployed 164
250	250	pursuant to s. 121.091(9)(g) before meeting the definition of 165
251	251	termination in s. 121.021(39), such retiree must cease all 166
252	252	employment relationships, including service as a substitute 167
253	253	teacher, with participating employers for 6 calendar months in 168
254	254	order to be enrolled as a renewed member if subsequently 169
255	255	reemployed in a regularly established position. 170
256	256	Section 4. Paragraph (a) of subsection (1) of section 171
257	257	121.591, Florida Statutes, is amended to read: 172
258	258	121.591 Payment of benefits. —Benefits may not be paid 173
259	259	under the Florida Retirement System Investment Plan unless the 174
260	260	member has terminated employment as provided in s. 175
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269	269	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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273	273	121.021(39)(a) or is deceased and a proper application has been 176
274	274	filed as prescribed b y the state board or the department. 177
275	275	Benefits, including employee contributions, are not payable 178
276	276	under the investment plan for employee hardships, unforeseeable 179
277	277	emergencies, loans, medical expenses, educational expenses, 180
278	278	purchase of a principal residence, payments necessary to prevent 181
279	279	eviction or foreclosure on an employee's principal residence, or 182
280	280	any other reason except a requested distribution for retirement, 183
281	281	a mandatory de minimis distribution authorized by the 184
282	282	administrator, or a required minimum distr ibution provided 185
283	283	pursuant to the Internal Revenue Code. The state board or 186
284	284	department, as appropriate, may cancel an application for 187
285	285	retirement benefits if the member or beneficiary fails to timely 188
286	286	provide the information and documents required by this cha pter 189
287	287	and the rules of the state board and department. In accordance 190
288	288	with their respective responsibilities, the state board and the 191
289	289	department shall adopt rules establishing procedures for 192
290	290	application for retirement benefits and for the cancellation of 193
291	291	such application if the required information or documents are 194
292	292	not received. The state board and the department, as 195
293	293	appropriate, are authorized to cash out a de minimis account of 196
294	294	a member who has been terminated from Florida Retirement System 197
295	295	covered employment for a minimum of 6 calendar months. A de 198
296	296	minimis account is an account containing employer and employee 199
297	297	contributions and accumulated earnings of not more than $5,000 200
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306	306	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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310	310	made under the provisions of this chapter. Such cash -out must be 201
311	311	a complete lump-sum liquidation of the account balance, subject 202
312	312	to the provisions of the Internal Revenue Code, or a lump -sum 203
313	313	direct rollover distribution paid directly to the custodian of 204
314	314	an eligible retirement plan, as defined by the Internal Revenue 205
315	315	Code, on behalf of the m ember. Any nonvested accumulations and 206
316	316	associated service credit, including amounts transferred to the 207
317	317	suspense account of the Florida Retirement System Investment 208
318	318	Plan Trust Fund authorized under s. 121.4501(6), shall be 209
319	319	forfeited upon payment of any vest ed benefit to a member or 210
320	320	beneficiary, except for de minimis distributions or minimum 211
321	321	required distributions as provided under this section. If any 212
322	322	financial instrument issued for the payment of retirement 213
323	323	benefits under this section is not presented for p ayment within 214
324	324	180 days after the last day of the month in which it was 215
325	325	originally issued, the third -party administrator or other duly 216
326	326	authorized agent of the state board shall cancel the instrument 217
327	327	and credit the amount of the instrument to the suspense ac count 218
328	328	of the Florida Retirement System Investment Plan Trust Fund 219
329	329	authorized under s. 121.4501(6). Any amounts transferred to the 220
330	330	suspense account are payable upon a proper application, not to 221
331	331	include earnings thereon, as provided in this section, within 1 0 222
332	332	years after the last day of the month in which the instrument 223
333	333	was originally issued, after which time such amounts and any 224
334	334	earnings attributable to employer contributions shall be 225
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343	343	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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347	347	forfeited. Any forfeited amounts are assets of the trust fund 226
348	348	and are not subject to chapter 717. 227
349	349	(1) NORMAL BENEFITS. —Under the investment plan: 228
350	350	(a) Benefits in the form of vested accumulations as 229
351	351	described in s. 121.4501(6) are payable under this subsection in 230
352	352	accordance with the following terms and conditions: 231
353	353	1. Benefits are payable only to a member, an alternate 232
354	354	payee of a qualified domestic relations order, or a beneficiary. 233
355	355	2. Benefits shall be paid by the third -party administrator 234
356	356	or designated approved providers in accordance with the law, the 235
357	357	contracts, and any applicable board rule or policy. 236
358	358	3. The member must be terminated from all employment with 237
359	359	all Florida Retirement System employers, as provided in s. 238
360	360	121.021(39). 239
361	361	4. Benefit payments may not be made until the member has 240
362	362	been terminated for 3 calendar m onths, except that the state 241
363	363	board may authorize by rule for the distribution of up to 10 242
364	364	percent of the member's account after being terminated for 1 243
365	365	calendar month if the member has reached the normal retirement 244
366	366	date as defined in s. 121.021. 245
367	367	5. If a member or former member of the Florida Retirement 246
368	368	System receives an invalid distribution, such person must either 247
369	369	repay the full amount within 90 days after receipt of final 248
370	370	notification by the state board or the third -party administrator 249
371	371	that the distribution was invalid, or, in lieu of repayment, the 250
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380	380	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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384	384	member must terminate employment from all participating 251
385	385	employers. If such person fails to repay the full invalid 252
386	386	distribution within 90 days after receipt of final notification, 253
387	387	the person may be deemed reti red from the investment plan by the 254
388	388	state board and is subject to s. 121.122. If such person is 255
389	389	deemed retired, any joint and several liability set out in s. 256
390	390	121.091(9)(d)3. s. 121.091(9)(d)2. is void, and the state board, 257
391	391	the department, or the employing agency is not liable for gains 258
392	392	on payroll contributions that have not been deposited to the 259
393	393	person's account in the investment plan, pending resolution of 260
394	394	the invalid distribution. The member or former member who has 261
395	395	been deemed retired or who has been det ermined by the state 262
396	396	board to have taken an invalid distribution may appeal the 263
397	397	agency decision through the complaint process as provided under 264
398	398	s. 121.4501(9)(g)3. As used in this subparagraph, the term 265
399	399	"invalid distribution" means any distribution from an account in 266
400	400	the investment plan which is taken in violation of this section, 267
401	401	s. 121.091(9), or s. 121.4501. 268
402	402	Section 5. (1) Effective upon this act becoming a law, 269
403	403	the State Board of Administration and the Department of 270
404	404	Management Services shall reques t, as soon as practicable, a 271
405	405	determination letter and private letter ruling from the United 272
406	406	States Internal Revenue Service. If the United States Internal 273
407	407	Revenue Service refuses to act upon a request for a private 274
408	408	letter ruling, a legal opinion from a qua lified tax attorney or 275
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417	417	F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
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421	421	firm may be substituted for the private letter ruling. 276
422	422	(2) If the State Board of Administration or the Department 277
423	423	of Management Services receives notification from the United 278
424	424	States Internal Revenue Service that this act or any por tion of 279
425	425	this act will cause the Florida Retirement System, or a portion 280
426	426	thereof, to be disqualified for tax purposes under the Internal 281
427	427	Revenue Code, the act or any portion thereof which will cause 282
428	428	the disqualification does not apply. Upon receipt of such 283
429	429	notice, the state board and the department shall notify the 284
430	430	presiding officers of the Legislature. 285
431	431	Section 6. Except as otherwise expressly provided in this 286
432	432	act and except for this section, which shall take effect upon 287
433	433	becoming a law, this act shall ta ke effect January 1, 2025. 288