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 400
INTRODUCER: Governmental Oversight and Accountability Committee and Senators Burgess and
Hooper
SUBJECT: Reemployment of Retired Law Enforcement Officers
DATE: February 5, 2024
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. McVaney 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 400 authorizes, effective July 1, 2024, an FRS retiree, regardless of membership class, to
be reemployed with an employer participating in the Florida Retirement System (FRS) after
meeting the definition of termination and receive both compensation from the employer and an
FRS retirement benefit. This effectively eliminates the “suspension of benefits” period typically
applied during months 7 through 12 after the date of termination. The retiree must still achieve a
bona fide termination of service with all FRS-participating employers.
The bill is expected to increase actuarial liabilities of the Florida Retirement System by
$23.8 million annually system-wide which will be funded by increases in the annual employer-
paid contributions to the FRS Trust Fund.
The bill takes effect July 1, 2024.
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
REVISED: BILL: CS/SB 400 Page 2
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, 2023, the FRS had 646,277 active non-retired members, 455,601 annuitants,
14,499 disabled retirees, and 27,767 active participants of the Deferred Retirement Option
Program (DROP).
3
As of June 30, 2023, the FRS consisted of 991 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 Class
5
consists of 550,931 active members and 8,433 in renewed membership;
The Special Risk Class
6
includes 75,495 active members and 1,168 in renewed membership;
The Special Risk Administrative Support Class
7
has 93 active members and one in renewed
membership;
The Elected Officers’ Class
8
has 2,105 active members and 106 in renewed membership; and
The Senior Management Service Class
9
has 7,714 active members and 227 in renewed
membership.
10
Each class is funded separately based upon the costs attributable to the members of that class.
1
Florida Department of Management Services (DMS), Division of Retirement, Florida Retirement System Summary Plan
Description, 1 (July 1, 2023), https://frs.fl.gov/forms/spd-pp.pdf (last visited Jan. 5, 2024).
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
DMS, Division of Retirement, Florida Retirement System Pension Plan and Other State Administered Retirement Systems
FY 2022-223 Annual Comprehensive Financial Report, at 188, available at https://employer.frs.fl.gov/forms/2022-
23_ACFR.pdf. (last visited Jan. 5, 2024).
4
DMS, Division of Retirement, Participating Employers for Fiscal Year 2023-2024 (Oct. 2023), available at
https://employer.frs.fl.gov/forms/part-emp.pdf (last visited Jan. 5, 2024).
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. See also, DMS, FRS Pension Plan
Member Handbook, 9-14 (2023), available at https://frs.fl.gov/forms/member_handbook.pdf (last visited Jan. 5, 2024).
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.
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 2022-
23 Annual Comprehensive Financial Report, at 191. BILL: CS/SB 400 Page 3
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
The State Board of Administration (SBA) is primarily responsible for administering the
investment plan.
13
The Board of Trustees of the SBA is comprised of the Governor as chair, the
Chief Financial Officer, and the Attorney General.
14
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.
15
A member vests immediately in all employee contributions paid to the investment plan.
16
With
respect to the employer contributions, a member vests after completing one work year of
employment with an FRS employer.
17
Vested benefits are payable upon termination or death as a
lump-sum distribution, direct rollover distribution, or periodic distribution.
18
The investment
plan also provides disability coverage for both in-line-of-duty and regular disability retirement
benefits.
19
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.
20
11
Florida State Board of Administration (SBA), Plan Comparison Chart (Jul. 2020), available at
https://www.myfrs.com/pdf/forms/plancomparison.pdf (last visited Jan. 5, 2024).
12
See, ch. 2000-169, Laws of Fla.
13
Section 121.4501(8), F.S.
14
FLA. CONST. art. IV, s. 4.
15
Section 121.4501(1), F.S.
16
Section 121.4501(6)(a), F.S.
17
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.
18
Section 121.591, F.S.
19
See s. 121.4501(16), F.S.
20
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 400 Page 4
Pension Plan
The pension plan is a defined benefit plan administered by the Department of Management
Services (DMS) through the Division of Retirement.
21
The State Board of Administration
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 non-special risk members of the pension plan initially enrolled before July 1, 2011, normal
retirement (when first eligible for unreduced benefits) occurs at the earlier of 30 years of service
or age 62.
26
Those non-special risk members initially enrolled in the pension plan on or after
July 1, 2011, must complete 33 years of credible service or attain age 65.
27
For members in the
Special Risk and Special Risk Administrative Support Classes, normal retirement is the earlier of
25 years of credible service or age 55.
28
Deferred Retirement Option Program
The Deferred Retirement Option Program (DROP) allows eligible members of the FRS Pension
Plan to participate in the program and defer receipt of retirement benefits while continuing
employment with an FRS employer. The deferred monthly benefits accrue, plus interest,
29
in the
FRS on behalf of the employee for the period of time the member participates in DROP. Upon
termination of employment, the member receives the total DROP benefits and begins to receive
the previously determined normal retirement benefits.
30
A member may elect to participate in DROP any time after reaching the normal retirement
date.
31
Generally, an eligible member is authorized to participate in DROP for 8 years. However,
certain instructional personnel may participate in DROP for 10 years until June 30, 2029.
32
21
Section 121.025, F.S.
22
SBA Florida, Florida Retirement System Pension Plan,
https://www.sbafla.com/fsb/FundsWeManage/FRSPensionPlan.aspx (last visited Jan. 5, 2024).
23
Section 121.021(45)(a), F.S.
24
Section 121.021(45)(b), F.S.
25
Section 121.091, F.S. See also, DMS, FRS Pension Plan Member Handbook, 28 (2023),
https://frs.fl.gov/forms/member_handbook.pdf (last visited Jan. 5, 2024).
26
Section 121.021(29)(a)1., F.S.
27
Section 121.021(29)(a)2., F.S.
28
Section 121.021(29)(b), F.S.
29
Currently, the interest that is applied accrues at an effective annual rate of 4 percent compounded monthly. Before July 1,
2011, the rate was 6.5 percent, and between July 1, 2011, through June 30, 2023, the rate was 1.3 percent.
S. 121.091(13)(c)1., F.S.
30
Section 121.091(13), F.S.
31
Section 121.091(13)(a)2., F.S.
32
Section 121.091(13)(b), F.S. BILL: CS/SB 400 Page 5
Renewed Membership
Effective July 1, 2017,
33
retirees of the investment plan, Senior Management Service Optional
Annuity Program (SMSOAP), State University System Optional Retirement Program
(SUSORP), or State University System Optional Retirement Program (SCCORP) may renew
membership in the FRS.
34
Such renewed member will participate in the appropriate membership
class in the investment plan, unless employed in a position eligible for participation in the
SUSORP or the SCCSORP, in which case the retiree will become a renewed member of the
SUSORP or the SCCSORP, as applicable. A renewed member may not qualify for disability
retirement benefits and must satisfy the vesting requirements of the specific plan. A renewed
member in the FRS Investment Plan who is not receiving the maximum health insurance subsidy
is entitled to earn additional credit towards the subsidy.
35
Retired FRS Pension Plan members are
not eligible for renewed membership in the FRS.
36
Optional Retirement Programs
Eligible employees may choose to participate in one of three retirement programs instead of
participating in the FRS:
Members of the Senior Management Service Class may elect to enroll in the Senior
Management Service Optional Annuity Program;
37
Members in specified positions in the State University System may elect to enroll in the
(SUSORP);
38
and
Members in specified positions at a Florida College institution may elect to enroll in the
SCCORP.
39
33
Different renewed membership provisions apply to FRS members who retired and were reemployed prior to July 1, 2010.
Prior to July 1, 2010, retirees of the pension plan or investment plan could renew membership in either plan or in another
state administered retirement system similar to newly hired members and earn service credit towards a subsequent retirement
benefit. From July 1, 2010, to July 1, 2017, FRS retirees were ineligible to be enrolled as a renewed member. S. 121.122(1)
and (2), F.S.
34
Section 121.122(3), (4), and (5), F.S. Upon renewed membership, the employer and the renewed member are required to
pay applicable contributions.
35
Id.
36
Section 121.122(2), F.S.
37
The Senior Management Service Optional Annuity Program (SMSOAP) was established in 1986 for members of the
Senior Management Service Class. Employees in eligible positions may irrevocably elect to participate in the SMSOAP
rather than the FRS. Effective July 1, 2017, the SMSOAP is closed to new members. Section 121.055(6), F.S. See also,
Florida DMS, Senior Management Service Optional Annuity Program,
https://www.dms.myflorida.com/workforce_operations/retirement/optional_retirement_programs/senior_management_servic
e_optional_annuity_program (last visited Jan. 5, 2024).
38
Eligible participants of the State University System Optional Retirement Program (SUSORP) are automatically enrolled in
the SUSORP. However, the member must execute a contract with a SUSORP provider within the first 90 days of
employment or the employee will default into the pension plan. If the employee decides to remain in the SUSORP, the
decision is irrevocable and the member must remain in the SUSORP as long as the member remains in a SUSORP-eligible
position. Section 121.35(3)(c), F.S.
39
If the member is eligible for participation in a State Community College System Optional Retirement Program, the member
must elect to participate in the program within 90 days of employment. Unlike the other optional programs, an employee who
elects to participate in this optional retirement program has one opportunity to transfer to the FRS. Section 1012.875, F.S. BILL: CS/SB 400 Page 6
The SUSORP requires each employee to contribute 3 percent
40
of his or her gross compensation
to the plan, and the employer must contribute the difference between the current employee
contribution (3 percent) and 8.15 percent of the employee’s gross monthly compensation
(currently, the employer contribution is 5.15%).
41
The state university employer is also required
to contribute an amount equal to the UAL contribution to the FRS Trust Fund.
42
Contribution Rates
Employers that participate in the FRS must contribute a specific percentage of the member’s
monthly compensation to the Division of Retirement to be distributed into the FRS Contributions
Clearing Trust Fund. The employer contribution rate is a blended contribution rate set by statute,
which is the same percentage regardless of whether the member participates in the pension plan
or the investment plan.
43
The rate is determined annually based on an actuarial study by the DMS
that calculates the necessary level of funding to support all of the benefit obligations under both
FRS retirement plans.
In the annual actuarial valuation of the Florida Retirement System based on July 1, 2023, plan
assets and liabilities, Milliman, Inc., the state actuary, determined the following key data relating
to the FRS pension plan:
44
Valuation Results (in $ billions)
July 1, 2020 July 1, 2021 July 1, 2022 July 1, 2023
Actuarial Liability $200.3 $209.6 $217.4 $226.2
Actuarial Value of Assets $164.3 $174.9 $179.2 $184.2
Unfunded Actuarial Liability $36.0 $34.7 $38.3 $42.0
Funded Percentage
(Actuarial Value of
Assets/Actuarial Liability)
82.0% 83.4% 82.4% 81.4%
The state actuary determines a rate associated with the normal cost of the pension plan (funding
the prospective benefits) and a rate necessary to amortize prior unfunded actuarial liabilities
(UAL) over a thirty-year period and new tranches of unfunded actuarial liabilities over a twenty-
year period. The following are the current employer contribution rates
45
for each class and the
blended rates recommended by the state actuary beginning in July 2024:
46
40
This contribution is tied to the FRS employee contribution required by s. 121.71(3), F.S., which is three percent as of
July 1, 2011.
41
Section 121.35(4)(a)4., F.S.
42
Section 121.35(4)(b), F.S.
43
Section 121.70(1), F.S.
44
Matt Larrabee, Milliman Actuarial Valuation, Florida Retirement System Pension Plan Actuarial Valuation as of July 1,
2023, 3 (Dec. 1, 2023) (on file with the Senate Committee on Governmental Oversight and Accountability).
45
Section 121.71(4) and (5), F.S.
46
Letter to Kathy Gould, Florida DMS Division of Retirement Director, from Milliman Actuarial Services, entitled “Blended
Proposed Statutory Rates for the 2024-2025 Plan Year Reflecting a Uniform UAL Rate for All Membership Classes and
DROP: Table 1” Dec. 1, 2023 (on file with the Senate Committee on Governmental Oversight and Accountability). BILL: CS/SB 400 Page 7
Membership Class
Current Statutory
Rates
Effective July 1, 2023
Recommended Rates
to be effective
July 1, 2024
Normal
Cost
UAL
Rate
Normal
Cost
UAL
Rate
Regular Class 6.73% 4.78% 6.70% 4.81%
Special Risk Class 18.66% 11.95% 18.39% 12.00%
Special Risk Administrative Support
Class
11.54% 26.22% 10.92% 25.90%
Elected Officer’s Class
Legislators, Governor, Lt.
Governor, Cabinet Officers,
State Attorneys, Public
Defenders
Justices and Judges
County Officers
10.45%
14.90%
12.39%
50.21 %
27.93%
44.23%
10.68%
14.50%
12.22%
49.81%
28.39%
43.44%
Senior Management Service Class 8.56% 23.90% 8.44% 22.72%
Deferred Retirement Option Program 8.49% 10.64% 8.46% 10.51%
For all membership classes, except the DROP and certain members with renewed membership,
employees contribute three percent of their compensation towards retirement.
47
After employer and employee contributions are placed into the FRS Contributions Clearing Trust
Fund, the allocations under the investment plan are transferred to third-party administrators to be
placed in the employee’s individual investment accounts, whereas contributions under the
pension plan are transferred into the FRS Trust Fund.
48
Maintaining Status as a Qualified Plan
The FRS is a qualified governmental plan under section 414(d) under Internal Revenue Code.
This means that the employer and employee contributions to the FRS qualify for tax deductions,
and that investment earnings are tax-deferred until distributed to retirees.
“In order for a pension plan to be a qualified plan under section 401(a), the plan must be
established and maintained by an employer primarily to provide systematically for the payment
of definitely determinable benefits to its employees over a period of years, usually for life, after
retirement (emphasis added) or attainment of normal retirement age . . ..”
49
A termination of employment must be bona fide (i.e., not a mere subterfuge in order to initiate an
otherwise impermissible distribution where no substantial change in employment has
occurred).
50
“Retirement does not include a mere reduction in the number of hours that an
47
Section 121.71(3), F.S.
48
See ss. 121.4503 and 121.72(1), F.S.
49
Treas. Reg. section 1.401(a)-1(b)(1)(i).
50
Private Letter Ruling 201147038 (Apr. 20, 2010). BILL: CS/SB 400 Page 8
employee works. Accordingly, benefits may not be distributed prior to normal retirement age
solely due to a reduction in the number of hours that an employee works.”
51
Current Florida law relating to the FRS requires an employee to terminate his or her employment
in order to commence a retirement benefit, either before or after normal retirement age. The
determination of whether a bona fide termination from employment has occurred is critical for
both the tax qualification of the FRS and Florida statutory compliance purposes.
52
The Internal Revenue Service (IRS), the federal agency responsible for administering the
Internal Revenue Code, has not provided an objective test for determining whether a bona fide
termination of employment has occurred. Instead the IRS has applied Treasury Regulation
1.409A-1(h)(l)(ii), which states whether a termination of employment has occurred is determined
based on whether the facts and circumstances indicate that the employer and employee
reasonably anticipated that no further services would be performed after a certain date
53
or that
the level of bona fide services the employee would perform after such date would permanently
decrease to no more than 20 percent of the average level of bona fide services performed over
the immediately preceding 36-month period.
54
However, when applying the regulation in the
context of a 401(a) plan, the IRS has opined that “if both the employer and employee know at the
time of ‘retirement’ that the employee will, with reasonably [sic] certainty, continue to perform
services for the employer, a termination of employment has not occurred upon ‘retirement’ and
the employee has not legitimately retired.”
55
To apply the requirement of a bona fide termination, Florida law states “termination” occurs
“when a member ceases all employment relationships with participating employers.”
56
This
includes a relationship with an FRS-participating employer as an officer, employee, or volunteer.
If the retiree is reemployed by an FRS-participating employer within the first 6 calendar months
after the month of retirement, termination is deemed not to have occurred, and the retiree must
return all retirement distributions, including DROP accumulations.
57
Generally, if the retiree is
employed by an FRS-participating employer during the 7th through 12th calendar months after
the month of retirement, the retiree’s benefit for those months is suspended and is forfeited.
58
There are no restrictions on receiving salary and retirement benefits from FRS-participating
employers after the 12
th
calendar month from retirement.
51
Treas. Reg. section 1.401(a)-1(b)(3).
52
Memorandum to David DiSalvo, Director, Division of Retirement, Re: Bona Fide Terminations from Employment and
Bona Fide Volunteer Services (dated January 8, 2021).
53
The regulation provides that the employment relationship is treated as continuing intact while the individual is on a bona
fide leave of absence if the leave does not exceed 6 months, or if longer, as long as the individual retains a right to
reemployment pursuant to statute or contract. The IRS explains in the preamble to the regulation that “a bona fide leave of
absence refers to a leave of absence where there is a reasonable expectation the service provider will return to service with
the service recipient.” Department of the Treasury, Internal Revenue Service, Application of Section 409A to Nonqualified
Deferred Compensation Plans, 26 CFR Part I [TD 9321], RIN 1545-BE79 (Dated April 17, 2007).
54
See IRS PLR 201147038; see also Supra note 58
55
IRS PLR 201147038.
56
Section 121.021(39), F.S.
57
Section 121.091(9), F.S.
58
Section 121.091(9)(c), F.S. BILL: CS/SB 400 Page 9
A retiree employed in violation of the reemployment limitation period and the FRS employer
employing such retiree are jointly and severally liable for reimbursement to the retirement trust
fund from which the benefits were paid. Pension benefits remain suspended until repayment has
been made. Benefits suspended beyond the reemployment limitation period are applied towards
repaying the benefits received in violation of the reemployment limitation period.
59
Florida law currently provides two exceptions to the reemployment limitation period. The first
authorizes retirees to provide civic, charitable, and humanitarian services to an FRS employer
during the first 12 months following retirement provided the following criteria are met:
Before the date of retirement, there is no agreement or understanding between the employer
and the retiree that the retiree will return to provide services for the employer;
The employer or a third party does not provide any form of compensation, including any cash
equivalents, to the volunteer for the volunteer service;
Except as otherwise provided in law, a volunteer cannot be provided any employee benefits,
including health or life insurance benefits. However, a volunteer may be provided certain
perquisites necessary for, and for the limited purpose of, completing tasks associated with the
volunteer program, such as an assigned uniform or the provision of equipment;
The number of volunteer hours per week, including training hours, that the volunteer
provides is no more than 20 percent of the number of hours that the volunteer was expected
to work per week before the date of retirement;
There is a clear distinction between the duties of a volunteer and the duties of an employee;
The schedule of a volunteer, including the number of hours volunteered and the number and
type of assignments for which he or she agrees to volunteer, is controlled by the volunteer;
and
The employer and retiree maintain adequate records to document adherence to the above
criteria, which must be made available to DMS or the SBA upon request.
60
The second exception to the reemployment limitation period applies to law enforcement officers
that are reemployed as school resource officers and authorizes such retirees to be reemployed
during months 7 through 12 after retirement and receive both a salary and retirement benefits.
The reemployed retired law enforcement officer may not renew membership in the FRS except
as provided in law.
61
State and County Officers and Employees Retirement System
The State and County Officers and Employees Retirement System (SCOERS) was consolidated
into the FRS in 1970 as a closed plan.
62
The SCOERS retirees may be reemployed by any private
or public employer after retirement and receive retirement benefits and compensation without
limitation, unless the public employer participates in the FRS. The SCOERS retirees reemployed
by an FRS employer are prohibited from receiving a salary from reemployment and retirement
benefits for 12 months after their date of retirement. Any retiree employed in violation of the
reemployment limitation period must provide notice of such reemployment to his or her
59
Section 121.091(9)(b)1. and (9)(c)3., F.S.
60
Section 121.091(15), F.S.
61
Section 121.091(9)(f), F.S.
62
Annual Report, supra note 5, at 33. BILL: CS/SB 400 Page 10
employer and the DMS, and that person’s retirement benefits will be suspended for the duration
of the reemployment limitation period. A retiree employed in violation of the reemployment
limitation period and any agency that knowingly employs such retiree are jointly and severally
liable for reimbursement to the retirement trust fund from which the benefits were paid. In order
to avoid liability, the FRS employer must have a written statement from the retiree that the
person is not retired from a state-administered retirement system. Any benefits suspended
beyond the reemployment limitation period will apply toward the repayment of benefits received
in violation of the reemployment limitation period.
63
III. Effect of Proposed Changes:
Section 1 amends s. 121.091, F.S, to allow, effective July 1, 2024, an FRS retiree, regardless of
membership class, to be reemployed with an FRS participating employer after meeting the
definition of termination and receive both compensation from the employer and an FRS
retirement benefit. This effectively eliminates the “suspension of benefits” period typically
applied during months 7 through 12 after the date of termination. The retiree must still achieve a
bona fide termination of service with all FRS-participating employers.
Section 1 also deletes specific language allowing a retired law enforcement officer to be
employed as a school resource officer during the 7 to 12 month suspension period but continue to
receive salary and retirement benefits. This language is redundant to the new provision described
above.
Section 2 increases the employer-paid contribution rates to fund the FRS. These amounts are in
addition to other rates enacted to take effect July 1, 2024.
Section 3 makes a legislative determination and declaration that this act fulfills an important
state interest.
Section 4 provides that the bill takes effect July 1, 2024.
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
Article VII, s. 18(a) of the State Constitution provides that: “No county or municipality
shall be bound by any general law requiring such county or municipality to spend
funds...unless the legislature has determined that such law fulfills an important state
interest and unless: ...the expenditure is required to comply with a law that applies to all
persons similarly situated….”
This bill includes legislative findings that the bill fulfills important state interests, and the
bill applies to all persons similarly situated (those employers participating in the Florida
63
Section 122.16(1) and (2), F.S. The reemployment authorization does not apply to those members retired due to disability.
See s. 122.16(2)(a), F.S. Employer and employee contributions are required as provided in s. 121.122, F.S. for renewed
membership in the FRS. S. 122.16(2)(c), F.S. BILL: CS/SB 400 Page 11
Retirement System), including state agencies, school boards, state universities,
community colleges, counties, municipalities, and special districts.
B. Public Records/Open Meetings Issues:
None.
C. Trust Funds Restrictions:
None.
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
None identified.
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
None.
C. Government Sector Impact:
The bill is expected to increase actuarial liabilities of the Florida Retirement System by
$23.8 million annually system-wide. The state actuary completed a study to determine the
actuarial impact if the suspension of benefits during the seventh through twelfth month
period is eliminated for all members of the FRS. The results indicated a system-wide cost
of $23.8 million annually. The table below shows the impacts by employer group.
64
Employer Group Increase in Annual
Contributions
State $3.7 m
School Boards $7.2 m
Universities and Colleges $2.6 m
Counties $8.9 m
Other $1.4 m
Total $23.8 m
64
Id at 21. BILL: CS/SB 400 Page 12
VI. Technical Deficiencies:
None.
VII. Related Issues:
None.
VIII. Statutes Affected:
This bill substantially amends sections 121.091 of the Florida Statutes.
IX. Additional Information:
A. Committee Substitute – Statement of Substantial Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
CS by Governmental Oversight and Accountability on January 29, 2024:
The CS expands the application of the bill to allow all FRS retirees who have met the
definition of termination (separated for 6 months from all FRS-participating employers)
to be reemployed and receive both salary and retirement benefits. The CS also increases
the employer-paid contributions to the FRS to fund the new benefits on an actuarially
sound basis.
B. Amendments:
None.
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.