Florida Senate - 2024 SB 1022 By Senator Rodriguez 40-01354A-24 20241022__ 1 A bill to be entitled 2 An act relating to pension plan election under the 3 Florida Retirement System; amending s. 121.4501, F.S.; 4 authorizing certain eligible employees participating 5 in the Florida Retirement System to make a second 6 election to move back to the pension plan; requiring 7 the Division of Retirement to notify employees 8 eligible to make such election by a specified date; 9 providing requirements for such election; providing 10 that the cost of such election is deferred until the 11 members retirement; authorizing that such cost be 12 amortized over a certain period of time; prohibiting 13 such cost from exceeding a specified percentage of the 14 members retirement benefits; conforming cross 15 references; amending s. 121.122, F.S.; conforming 16 cross-references; providing an effective date. 17 18 Be It Enacted by the Legislature of the State of Florida: 19 20 Section 1.Paragraphs (a) and (b) of subsection (4) of 21 section 121.4501, Florida Statutes, are amended, and paragraph 22 (g) is added to that subsection, to read: 23 121.4501Florida Retirement System Investment Plan. 24 (4)PARTICIPATION; ENROLLMENT. 25 (a)1.Effective June 1, 2002, through February 28, 2003, a 26 90-day election period was provided to each eligible employee 27 participating in the Florida Retirement System, preceded by a 28 90-day education period, permitting each eligible employee to 29 elect membership in the investment plan. An employee who failed 30 to elect the investment plan during the election period remained 31 in the pension plan. An eligible employee who was employed in a 32 regularly established position during the election period was 33 granted the option to make one subsequent election, as provided 34 in paragraphs (f) and (g) paragraph (f). With respect to an 35 eligible employee who did not participate in the initial 36 election period or who is initially employed in a regularly 37 established position after the close of the initial election 38 period but before January 1, 2018, such employee shall, by 39 default, be enrolled in the pension plan at the commencement of 40 employment and may, by the last business day of the 5th month 41 following the employees month of hire, elect to participate in 42 the investment plan. The employees election must be made in 43 writing or by electronic means and must be filed with the third 44 party administrator. The election to participate in the 45 investment plan is irrevocable, except as provided in paragraphs 46 (f) and (g) paragraph (f). 47 a.If the employee files such election within the 48 prescribed time period, enrollment in the investment plan is 49 effective on the first day of employment. The retirement 50 contributions paid through the month of the employee plan change 51 shall be transferred to the investment program, and, effective 52 the first day of the next month, the employer and employee must 53 pay the applicable contributions based on the employee 54 membership class in the program. 55 b.An employee who fails to elect to participate in the 56 investment plan within the prescribed time period is deemed to 57 have elected to retain membership in the pension plan, and the 58 employees option to elect to participate in the investment plan 59 is forfeited. 60 2.With respect to employees who become eligible to 61 participate in the investment plan pursuant to s. 62 121.051(2)(c)3. or s. 121.35(3)(i), the employee may elect to 63 participate in the investment plan in lieu of retaining his or 64 her membership in the State Community College System Optional 65 Retirement Program or the State University System Optional 66 Retirement Program. The election must be made in writing or by 67 electronic means and must be filed with the third-party 68 administrator. This election is irrevocable, except as provided 69 in paragraphs (f) and (g) paragraph (f). Upon making such 70 election, the employee shall be enrolled as a member in the 71 investment plan, the employees membership in the Florida 72 Retirement System is governed by the provisions of this part, 73 and the employees participation in the State Community College 74 System Optional Retirement Program or the State University 75 System Optional Retirement Program terminates. The employees 76 enrollment in the investment plan is effective on the first day 77 of the month for which a full months employer and employee 78 contribution is made to the investment plan. 79 (b)1.With respect to employees who become eligible to 80 participate in the investment plan by reason of employment in a 81 regularly established position commencing on or after January 1, 82 2018, or who did not complete an election window before January 83 1, 2018, any such employee shall be enrolled in the pension plan 84 at the commencement of employment and may, by the last business 85 day of the eighth month following the employees month of hire, 86 elect to participate in the pension plan or the investment plan. 87 Eligible employees may make a plan election only if they are 88 earning service credit in an employer-employee relationship 89 consistent with s. 121.021(17)(b), excluding leaves of absence 90 without pay. 91 2.The employees election must be made in writing or by 92 electronic means and must be filed with the third-party 93 administrator. The election to participate in the pension plan 94 or investment plan is irrevocable, except as provided in 95 paragraphs (f) and (g) paragraph (f). 96 3.a.Except as provided in subparagraph 4., if the employee 97 fails to make an election to either the pension plan or the 98 investment plan during the 8-month period following the month of 99 hire, the employee is deemed to have elected the investment plan 100 and shall default into the investment plan retroactively to the 101 employees date of employment. The employees option to 102 participate in the pension plan is forfeited, except as provided 103 in paragraphs (f) and (g) paragraph (f). 104 b.The amount of the employee and employer contributions 105 paid through the date of default to the investment plan shall be 106 transferred to the investment plan and shall be placed in a 107 default fund as designated by the State Board of Administration. 108 The employee may move the contributions once an account is 109 activated in the investment plan. 110 4.If the employee is employed in a position included in 111 the Special Risk Class and fails to make an election to either 112 the pension plan or the investment plan during the 8-month 113 period following the month of hire, the employee is deemed to 114 have elected the pension plan and shall default into the pension 115 plan retroactively to the employees date of employment. The 116 employees option to participate in the investment plan is 117 forfeited, except as provided in paragraphs (f) and (g) 118 paragraph (f). 119 5.Effective the first day of the month after an eligible 120 employee makes a plan election of the pension plan or investment 121 plan, or the first day of the month after default, the employee 122 and employer shall pay the applicable contributions based on the 123 employee membership class in the program. 124 (g)Effective July 1, 2024, an eligible employee 125 participating in the Florida Retirement System who was enrolled 126 in the pension plan before 2002 and who moved to the investment 127 plan under paragraph (f) may choose to move back to the pension 128 plan while deferring the cost until retirement. 129 1.Eligible employees may elect to move back to the pension 130 plan under this paragraph only if they are earning service 131 credit in an employer-employee relationship consistent with s. 132 121.021(17)(b), excluding leaves of absence without pay. 133 2.The division shall notify employees who qualify under 134 this paragraph no later than July 30, 2024. 135 3.The election to move back to the pension plan must be 136 made in writing and filed with the third-party administrator 137 within 90 days after an eligible employee receives notice from 138 the division under subparagraph 2. Such elections are effective 139 on the first day of the month after the receipt of the election 140 by the third-party administrator. 141 4.The cost of moving back to the pension plan under this 142 paragraph is deferred until the members retirement. If a member 143 is unable to pay the deferred cost, or the member terminates his 144 or her employment before retirement, such cost must be amortized 145 over a period of 10 years beginning in the year of the members 146 retirement, not to exceed 25 percent of the members retirement 147 benefits. 148 Section 2.Paragraph (j) of subsection (3), paragraph (e) 149 of subsection (4), and paragraph (e) of subsection (5) of 150 section 121.122, Florida Statutes, are amended to read: 151 121.122Renewed membership in system. 152 (3)A retiree of the investment plan, the State University 153 System Optional Retirement Program, the Senior Management 154 Service Optional Annuity Program, or the State Community College 155 System Optional Retirement Program who is reemployed with a 156 covered employer in a regularly established position on or after 157 July 1, 2017, shall be enrolled as a renewed member of the 158 investment plan unless employed in a position eligible for 159 participation in the State University System Optional Retirement 160 Program as provided in subsection (4) or the State Community 161 College System Optional Retirement Program as provided in 162 subsection (5). The renewed member must satisfy the vesting 163 requirements and other provisions of this chapter. 164 (j)Notwithstanding s. 121.4501(4)(f) and (g) s. 165 121.4501(4)(f), the renewed member is not eligible to elect 166 membership in the pension plan. 167 (4)A retiree of the investment plan, the State University 168 System Optional Retirement Program, the Senior Management 169 Service Optional Annuity Program, or the State Community College 170 System Optional Retirement Program who is reemployed on or after 171 July 1, 2017, in a regularly established position eligible for 172 participation in the State University System Optional Retirement 173 Program shall become a renewed member of the optional retirement 174 program. The renewed member must satisfy the vesting 175 requirements and other provisions of this chapter. Once 176 enrolled, a renewed member remains enrolled in the optional 177 retirement program while employed in an eligible position for 178 the optional retirement program. If employment in a different 179 covered position results in the renewed members enrollment in 180 the investment plan, the renewed member is no longer eligible to 181 participate in the optional retirement program unless employed 182 in a mandatory position under s. 121.35. 183 (e)Notwithstanding s. 121.4501(4)(f) and (g) s. 184 121.4501(4)(f), the renewed member is not eligible to elect 185 membership in the pension plan. 186 (5)A retiree of the investment plan, the State University 187 System Optional Retirement Program, the Senior Management 188 Service Optional Annuity Program, or the State Community College 189 System Optional Retirement Program who is reemployed on or after 190 July 1, 2017, in a regularly established position eligible for 191 participation in the State Community College System Optional 192 Retirement Program shall become a renewed member of the optional 193 retirement program. The renewed member must satisfy the 194 eligibility requirements of this chapter and s. 1012.875 for the 195 optional retirement program. Once enrolled, a renewed member 196 remains enrolled in the optional retirement program while 197 employed in an eligible position for the optional retirement 198 program. If employment in a different covered position results 199 in the renewed members enrollment in the investment plan, the 200 renewed member is no longer eligible to participate in the 201 optional retirement program. 202 (e)Notwithstanding s. 121.4501(4)(f) and (g) s. 203 121.4501(4)(f), the renewed member is not eligible to elect 204 membership in the pension plan. 205 Section 3.This act shall take effect July 1, 2024.