HomeMy WebLinkAboutAgenda Budget Oversight 072006CITY OF PALM BEACH GARDENS
10500 N Military Trail
Palm Beach Gardens, Fl 33410
BUDGET OVERSIGHT COMMITTEE
NOTICE OF MEETING AND AGENDA
Please take notice that the Budget Oversight Committee of the City of
Palm beach Gardens will conduct a meeting of the committee at the
above location on July 20, 2006 at 8:30 am in Council Chambers.
I. Roll Call
Il. Approval of minutes from the June 22, 2006 meeting
III. Discussion of FRS
IV. Budget Update
V. Discussion of Committee Report to Council
DISABILITY INFORMATION
In accordance with the Disabilities Act and F.S.S 286.26, persons with
disabilities needing special accommodation to participate in this proceeding
should contact the Human Resource Department no later then seven days
subsequent to the proceeding at (561) 799 -4223 for assistance, if hearing
impaired, telephone the Florida Relay Service Number at 800 - 955 -8770
(voice) for assistance.
APPEAL NOTICE
If a person decides to appeal any decision made by the board, with
respect to any matter considered at such meeting or hearing, he will need to
ensure that a verbatim record of the proceedings is made, which record
includes the testimony and evidence upon which the appeal is to be based.
FLORIDA RETIREMENT SYSTEM PENSION PLAN
SUMMARY PLAN DESCRIPTION
The following summary is a brief description of the Florida Retirement System Pension Plan. Questions of
interpretation shall be determined from part I of chapter 121, Florida Statutes, and chapter 60S of the
Florida Administrative Code.
Creation
The Florida Retirement System (FRS) was created December 1, 1970, with consolidation of 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 also consolidated with the FRS. The
system was created to provide a program offering retirement, disability, and survivor benefits for
participating public employees. Social Security coverage is also required for all members.
Membership
Membership in the FRS is compulsory for all full -time and part-time employees working in regularly
established positions for state agencies, county governments, district school boards, state universities,
community colleges, or participating cities or special districts. Certain members, including elected
officials and local government senior managers, may elect to not participate in the system. Members of
the Elected Officers' Class may elect to participate in the Senior Management Service Class in lieu of the
Elected Officers' Class or to withdraw from the FRS altogether. The following members may elect to
participate in various optional programs instead of the FRS:
• Most pension plan members (including renewed members), Senior Management Service
Optional Annuity Program participants, and Community College Optional Retirement Program
participants may elect to participate in the Public Employee Optional Retirement Program (FRS
Investment Plan). Participants of the State University System Optional Retirement Program or
FRS Pension Plan members who retired to join the Deferred Retirement-Option Program
(DROP) are not eligible to participate in this plan;
• Senior Management Service Class members who are state employees (including state -level
Elected Officers' Class members who choose to join that class) may elect to participate in the
Senior Management Service Optional Annuity Program (while locally designated members of
the class may elect to opt out of the system altogether);
• State University System faculty and administrative and professional employees may elect to
participate in the State University System Optional Retirement Program; and
• Community College System faculty and certain administrators may elect to participate in a
Community College Optional Retirement Program, if the college offers an optional retirement
program.
Classes of Membership
Regular Class — This class consists of members of the FRS who do not qualify for membership in the
Special Risk, Special Risk Administrative Support, Elected Officers', or Senior Management Service
Classes.
Special Risk Class — This class consists of members who meet the criteria to qualify for this class as set
forth in Florida Law and Rules, and who are employed as:
• Law enforcement officers;
• Firefighters (including fire prevention and firefighter training positions, and aerial firefighting
surveillance pilots for the Department of Agriculture and Consumer Services);
• Correctional officers or community -based correctional probation officers;
• Paramedics or emergency medical technicians;
FLORIDA RETIREMENT SYSTEM PENSION PLAN
Fv 2003/04
• Professional health care workers in specified positions within the Department of Corrections or
the Department of Children and Family Services who spend at least 75% of their time
performing duties that involve contact with patients or inmates in a correctional or forensic
facility or institution; or
• Youth custody officers with the Department of Juvenile Justice.
Special Risk Administrative Support Class — This class consists of special risk members who are
transferred or reassigned to a non - special -risk law enforcement, firefighting or correctional
administrative support position within an FRS special risk employing agency and meet the criteria set
forth in Florida Law.
Elected Officers' Class (EOC) — This class consists of members who hold specified elective offices in
either state or local government:
• State officers include: Governor, Lieutenant Governor, Cabinet Officer, Legislator, Supreme
Court Justice, district court of appeal judge, circuit judge, county court judge, state attorney,
and public defender.
• County officers include: sheriff, tax collector, property appraiser, supervisor of elections, school
board member, school board superintendent, clerk of circuit court, and county commissioner.
• City or special district officers include: Those elected officials in cities and special districts that
have chosen to place their elected officials in the EOC.
Senior Management Service Class (SMSC) — This class consists of:
• Members of the Senior Management Service of state government;
• Community college presidents;
• Appointed school board superintendents;
• County and city managers;
• Selected managerial staff of the Legislature;
• The Auditor General and managerial staff;
• The Executive Director of the Ethics Commission;
• The State University System Executive Service and university presidents;
• Selected managerial staff of the State Board of Administration;
• Judges of compensation claims;
• Selected managerial staff with the Judicial Branch;
• Capital collateral regional counsels and assistant capital collateral regional counsels;
• Assistant state attorneys;
• Assistant public defenders;
• Assistant statewide prosecutors or assistant attorneys general;
• Elected officials who chose to join the SMSC in lieu of the EOC;
• Nonelective managerial positions designated for SMSC membership by
local government agencies; and
• Chief Deputy Court Administrator.
PAGE 2 REVISED OCTOBER 2004
SUMMARY PLAN DESCRIPTION
Contributions
FLORIDA RETIREMENT SYSTEM PENSION PLAN
Retirement coverage is employee noncontributory. Employers pay all contributions. Effective July 1,
2002, the Florida Legislature established a uniform contribution rate system for the Florida Retirement
System (FRS), covering both the FRS Pension Plan and the FRS Investment Plan. Including the fee of
0.10% for administration of the FRS Investment Plan and provision of educational tools for both plans,
the uniform rates for FY 2003/04 are as follows:
Class
Regular .............
SpecialRisk ............................... ...............................
Special Risk Administrative Support .........................
Elected Officers
Judges........................................................................ ...............................
Governor, Lt. Governor, Cabinet, Legislators,
State Attorneys, and Public Defenders ........................ ...............................
Elected County Officials (in EOC) ................................. ...............................
Rate
................... 6.28%
.................. 17.42%
.................... 8.81%
...... 17.54%
..............11.38%
............. 14.12%
Senior Management Service .................................................................... ............................... 8.26%
Deferred Retirement Option Program (DROP) ........................................ ............................... 8.00%
Note: To offset the rates shown above, a portion of the normal cost has been prefunded from surplus
actuarial assets for all rates. These rates do not include the separate 1.11% contribution for the
Retiree Health Insurance Subsidy.
Any member who terminates employment with an FRS employer may receive a refund of any
retirement contributions personally made to the system (and lose the associated retirement credit), or
may leave these personal contributions in the system and keep all creditable service earned through the
date of termination.
Creditable Service
Members receive 1 month of service credit for each month in which any salary is paid for work
performed. Members may also purchase additional credit to increase their retirement benefits under
the FRS. Credit may be purchased for past service, prior service (including refunded service credit),
certain military service (up to 4 years), approved leaves of absence (up to 2 years), out -of -state public
service (including federal service), non -FRS public service and non - public service in certain schools or
colleges in Florida (up to 5 years total, including both in -state and out -of -state service), and in some
cases credit for periods of disability. To purchase this service credit, members must meet certain
requirements. Only the purchase of past service and prior service may be included in the creditable
years of service needed to vest (see next section). All other types of service credit purchases become
creditable service only after a member is vested based on his /her other service.
Vesting
Since July 1, 2001, the FRS has provided for vesting of benefits after 6 years of creditable service.
Members not employed in a position covered by the FRS on July 1, 2001, may be required to return to
covered employment for up to 1 work year to be eligible to vest with less service than was required
under the law in effect before July 1, 2001.
REVISED OCTOBER 2004 PAGE 3
FLORIDA RETIREMENT SYSTEM PENSION PLAN
Service Retirement
FY 2003/04
Members become eligible for normal retirement based on their age and /or service when they meet the
minimum requirements listed in the following section. Early retirement may be taken any time after a
member has vested; however, there is a 5% benefit reduction for each year remaining from a member's
retirement date to his /her normal retirement age.
Normal Retirement Requirements
Regular Class, Elected Six years of service and age 62, the age after 62 the member
Officers' Class, and Senior becomes vested, or thirty years of service, regardless of age,
Management Service Class whichever comes first.
Special Risk Class Six years of special risk service and age 55; or
Twenty -five total years of service, consisting of both special risk
service and up to four years of military service, and age 52; or
Twenty -five total years of special risk service, regardless of age; or
Thirty years of any creditable service, regardless of age.
Special Risk Administrative Special risk normal retirement requirements apply to service in this
Support Class class if member has six years actual special risk service;
otherwise Regular Class requirements apply.
Benefit Calculation
Service retirement benefits are computed on the basis of age and /or years of service, average final
compensation (AFC), and service credit. Credit for each year of service is expressed as a percentage of
AFC (the average of the 5 highest fiscal years of earnings). The total percentage value of the benefit
received is determined by calculating the total value of all service, which is based on the retirement
plan and /or class to which the member belonged when the service credit was earned. The following
chart shows the percentage value for each year of service credit earned:
VALUE
RETIREMENT PLAN (per year of service)
State and County Officers' and Employees' Retirement System (SCOERS)
Division A (no Social Security) ............................................ ............................... ..........................2.00%
Division B (with Social Security) ......................................... ............................... ..........................1.50%
Teachers' Retirement System (TRS)
PlanE ..................................................................................... ............................... ..........................2.00%
Florida Retirement System (FRS)
Regular Class
Retirement at age 62 or with 30 years of service .............. ............................... ..........................1.60%
Retirement at age 63 or 31 years of- service ..................... ............................... ..........................1.63%
Retirement at age 64 or 32 years of service ..................... ............................... ..........................1.65%
Retirement at age 65 or 33 or more years of service ........ ............................... ..........................1.68%
Special Risk Class
Service from 12/1/70 through 9/ 30/ 74 ............................... ............................... ..........................2.00%
Service on and after 10/ 1/ 74 ............................................. ............................... ..........................3.00%
Sjoecial Risk Administrative Support Class
(With 6 years of special risk service, the service in this class counts towards special risk normal retirement;
otherwise, Regular Class requirements apply.)
Retirement at age 55; or with 25 total years special risk service;
or at age 52 with 25 years (if total service includes military service) ........ ..........................1.60%
PAGE 4 REVISED OCTOBER 2004
SUMMARY PLAN DESCRIPTION FLORIDA RETIREMENT SYSTEM PENSION PLAN
Retirement at age 56; or with 26 total years special risk service;
or at age 53 with 26 years (if total service includes military service) ........ ..........................1.63%
Retirement at age 57; or with 27 total years special risk service;
or at age 54 with 27 years (if total service includes military service) ........ ..........................1.65%
Retirement at age 58; or with 28 total years special risk service;
or at age 55 with 28 years (if total service includes military service) ........ ..........................1.68%
Elected Officers' Class
Service as Supreme Court Justice, district court of appeal judge,
circuit court judge, or county court judge ................... ............................... ..........................3.33%
Service as Governor, Lt. Governor, Cabinet Officer, Legislator, state attorney,
public defender, elected county officer, or elected official of a city or special
district that chose EOC membership for its elected officials ..................... ..........................3.00%
Senior Management Service Class .................................... ............................... ..........................2.00%
There are three steps in computing an annual retirement benefit:
Step 1. Determine the member's retirement plan(s) and class(es) of membership, years of creditable
service in each, and the total percentage value earned.
Step 2. Calculate the average final compensation (AFC).
Step 3. Multiply the figures obtained in Steps 1 and 2 to determine the annual normal retirement benefit.
Benefit Options
Members must select one of the following four benefit options at retirement:
Option 1 — Member receives a benefit for life with no continuing survivor benefit at death.
Option 2 — Member receives a reduced benefit for life. If member dies anytime within 10 years after
retiring, the beneficiary will receive the benefit for the remainder of the 10 years.
Option 3 — Member receives a reduced benefit for life. Upon the member's death, the joint annuitant, if
living, will receive the same benefit for the remainder of his or her life. A joint annuitant
who is under age 25 and is the member's child or other dependent for whom the member
has guardianship will receive the member's maximum benefit, but only until age 25, or, if
disabled, until he or she is no longer disabled.
Option 4 — Member receives a reduced benefit for life. Upon the death of either the member or the
joint annuitant, the survivor will receive a lifetime benefit equal to two- thirds of the benefit
the member was receiving when both were living. A joint annuitant who is under age 25
and is the member's child or other dependent for whom the member has guardianship will
receive the member's maximum benefit, but only until age 25, or, if disabled, until he or she
is no longer disabled.
Termination
To receive monthly benefits payable under the FRS Pension Plan, eligible members must end all
employment relationships with all FRS employers for 1 calendar month, or begin participation in the
Deferred Retirement Option Program (DROP). Members who elect to participate in DROP must remain
off all FRS payrolls for 1 calendar month at the end of their program participation. (Special DROP
termination provisions may apply as described in the following section.)
REVISED OCTOBER 2004 PAGE 5
FLORIDA RETIREMENT SYSTEM PENSION PLAN FY 2003/04
Deferred Retirement Option Program
The Deferred Retirement Option Program (DROP) is available under the FRS Pension Plan when the
member first reaches eligibility for normal retirement. DROP allows a member to retire while
continuing employment for up to 60 months. While in DROP, the member's retirement benefits
accumulate in the FRS Trust Fund (increased by a cost -of- living adjustment each July) and earn
monthly interest equivalent to an annual rate of 6.5 %.
The election to participate in DROP must be made within 12 months of the member's normal
retirement date, unless the member is eligible to defer the election. To participate for the maximum
DROP period, the member must enter DROP upon first reaching eligibility for normal retirement, or
upon reaching an eligible deferral date as described below:
• A Special Risk Class member or a Special Risk Administrative Support Class member (with
6 years of Special Risk Class service) who reaches his or her normal retirement date based upon
years of service before reaching age 52 may defer DROP entry up to age 52 and still participate
for 60 months.
• A member of the Regular Class, Elected Officers' Class, or the Senior Management Service Class
who reaches his or her normal retirement date before reaching age 57 may defer DROP entry
until age 57 and still participate for 60 months.
• A member of the Elected Officers' Class who reaches his or her normal retirement date during a
term of office may defer the DROP election until the next succeeding term in that office and still
participate for up to 60 months or until the end of that succeeding term, whichever is less.
• A member who is employed as K -12 instructional personnel as defined in s. 1012.01(2), F.S.,
may elect to participate in DROP at any time after reaching his or her normal retirement date.
Upon termination, the DROP account is paid out as a lump sum payment, a rollover, or a combination
partial lump sum payment and rollover, and monthly benefits are paid to the member in the amount as
calculated upon entry into DROP, plus cost -of- living adjustments for intervening years.
In most cases, the DROP participant must cease employment after a maximum of 60 months in DROP,
must satisfy the termination requirements for retirement, and must comply with applicable
reemployment restrictions thereafter. However, certain exceptions apply:
• Effective July 1, 2002, a DROP participant who holds an elective office covered by the Elected
Officers' Class may end DROP participation and postpone compliance with termination
requirements and reemployment limitations until he or she no longer holds the elective office
(including consecutive terms in the same office). For the period between the end of DROP
participation and termination, no retirement credit is earned and the member's DROP
accumulation accrues no additional monthly benefits (but continues to earn interest). I
• Since June 1, 2003, K -12 instructional personnel employed with a district school board or the
Florida School for the Deaf and the Blind may extend their DROP participation for up to an
additional 36 months beyond their initial 60 -month DROP participation period. To qualify for
the extension, the DROP participant must receive authorization from the Division and from the
district school superintendent or the Board of Trustees of the School for the Deaf and the Blind,
as appropriate. If authorized to extend DROP participation, a participant must remain
employed in an eligible position.
Notwithstanding these provisions, any elected officer who entered DROP on or before June 30, 2002, is subject to prior
provisions of law and may end DROP without terminating employment and be automatically enrolled as a renewed
member of the Elected Officers' Class.
PAGE 6 REVISED OCTOBER 2004
SUMMARY PLAN DESCRIPTION
FLORIDA RETIREMENT SYSTEM PENSION PLAN
Since June 23, 2004, K -12 instructional personnel employed by a developmental research school
may extend DROP participation up to an additional 36 months beyond their initial 60 -month
DROP participation period. To qualify for the extension, the DROP participant must receive
authorization from the Division and from the developmental research school's director (or
principal if there is no director), as appropriate. If authorized to extend DROP participation
under this provision, a participant must remain employed in an eligible position.
Employers pay contributions at a rate of 8.00% of salary for all DROP participants.
Disability Benefits
Two types of disability retirement are available under the FRS: In- line -of -duty disability retirement
and regular disability retirement. To qualify for either type of disability retirement, members must be
totally and permanently disabled to the extent that they are unable to work. In- line -of -duty disability
benefits are available to members on their first day of employment. The minimum Option 1 benefit for
in- line -of -duty disability retirement is 42% of AFC for all members except those in the Special Risk
Class, who receive a minimum Option 1 in- line -of -duty disability benefit of 65% of AFC. To be eligible
for regular disability retirement, members must complete 8 years of creditable service. The minimum
Option 1 benefit under regular disability retirement is 25% of AFC. If a disabled member's service
benefit would be higher than the minimum disability benefit, the higher benefit is paid.
Survivor Benefits
If an active member dies in the line of duty, his /her spouse will receive a monthly benefit equal to one -
half of the member's monthly salary at death, payable for the spouse's lifetime. If the spouse dies, the
benefit will continue to the member's children until the youngest child reaches age 18 or is married, if
earlier.
If an active member dies before becoming vested and his /her death was not suffered in the line of
duty, the designated beneficiary will receive a refund of any member -paid retirement contributions.
However, if the active member dies within 1 year of vesting, the member's joint annuitant may use the
deceased member's accumulated leave on an hour -by -hour basis, or the member's eligible in -state or
out -of -state service, to purchase enough service credit to vest the deceased member and receive
monthly benefits.
If the member was vested at death, the beneficiary may receive a refund of any contributions that may
have been paid by the member or, if the beneficiary qualifies as a joint annuitant, he or she may receive
a lifetime monthly benefit calculated as though the member had retired on the date of death and had
chosen Option 3. If the joint annuitant is the member's child or other dependent for whom the member
has guardianship who is under age 25, he or she will receive the member's maximum benefit only until
age 25, or, if disabled, until no longer disabled. A deceased member's joint annuitant may buy any
service credit that could have been claimed by the member at the time of death.
Cost -of- Living Adjustments
The benefits received by retirees and beneficiaries are increased a 3% cost -of- living adjustment (COLA)
each July based on their June benefit amount (excluding the Retiree Health Insurance Subsidy benefit).
For retirees who have received benefits for less than 12 months on July 1, the increase is prorated. The
COLA applies to all continuing monthly retirement benefits paid under the FRS Pension Plan (i.e.,
normal and early service retirement benefits and benefits accruing in participant accounts under
DROP, disability retirement benefits, and survivor benefits).
REVISED OCTOBER 2004 PAGE 7
FLORIDA RETIREMENT SYSTEM PENSION PLAN FY 2003/04
Reemployment after Retirement
After retirement or DROP termination, retired FRS members may be reemployed by any private
employer or any public employer not participating in the FRS without affecting his /her their FRS
benefits. However, restrictions apply to reemployment with an FRS employer. Any retired FRS
member who is employed by an FRS employer during the first calendar month after retirement or
DROP termination is not considered to have terminated employment and is therefore not considered to
have retired. His /her active membership will be reinstated.
Upon meeting termination requirements, FRS retirees who are reemployed by FRS employers may not
receive both salary and retirement benefits for the rest of the 12 -month period after retirement, and
must forfeit retirement benefits for the months employed. Exceptions to the reemployment restrictions
allow FRS retirees to be reemployed in specified positions during the 2nd through 12th months of
retirement without forfeiting benefits. After being retired for 1 month, retirees may be reemployed
without further limitation in specified positions with district school boards, the Florida School for the
Deaf and the Blind, developmental research schools, and participating charter schools. Retirees may
also be reemployed for up to 780 hours in specified positions by a state community college or a
university in the State University System, or by FRS employers as firefighters or paramedics. Finally,
retired judges called to temporary duty and retirees appointed to or voted into elective office are
exempt from reemployment limitations after being retired for 1 month.
Renewed Membership
Retirees of the FRS who are reemployed in regularly established positions will have renewed
membership in the Regular Class, the Senior Management Service Class (SMSC), or the Elected
Officers' Class and earn credit toward a second - career benefit based on requirements for their class of
membership. Once retirees have established renewed membership in the system, they will have the
same opportunities to elect to participate in alternative retirement programs, or to withdraw from the
system altogether, as do similarly situated regular members of that membership class, and will be
subject to the same vesting requirements and other limitations as apply to other active members.
However, renewed members are not eligible to participate in the Special Risk Class, to participate in
the Deferred Retirement Option Program, or to retire under disability retirement provisions.
Appeals Procedure
Whenever the Division makes a decision that will reduce, suspend or terminate a member's retirement
benefits, the member may petition the Division for a hearing. Section 28- 106.201, F.A.C., outlines the
requirements for filing a petition. After the Division reviews the petition, the State Retirement Director
may ask a hearing officer from the Division of Administrative Hearings to conduct the hearing, or in
some cases the Department of Management Services may conduct the hearing. If the outcome of the
hearing is not in the member's favor, the member will be informed of the time period during which he
or she can appeal the decision to the District Court of Appeal.
PAGE 8 REVISED OCTOBER 2004
SUMMARY PLAN DESCRIPTION FLORIDA RETIREMENT SYSTEM PENSION PLAN
Forfeiture of Benefits
If, before retirement, a member commits a felony specified by law and is found guilty of or enters a
plea of no contest to such crime, or their employment was terminated due to admission of committing,
aiding, or abetting a specified crime, the member's retirement rights and benefits are forfeited (except
for a refund of personal retirement contributions, if any). The forfeiture of benefits provision applies in
the case of any job - related felony offense as outlined below:
• Committing, aiding or abetting an embezzlement of public funds or any grand theft from the
employer;
• Committing bribery in connection with employment;
• Committing any other felony specified in chapter 838, F.S., (bribery and misuse of public office),
except ss. 838.15 and 838.16, F.S., (commercial bribes);
• Committing any felony with intent to defraud the public or the employer of the right to receive
the faithful performance of duty, or receiving or attempting to receive profit or advantage for
the member or another person through the use of his or her position; or
• Committing an impeachable offense (applies to elected officials only).
In addition to the crimes stated above, if a court of competent jurisdiction finds the member guilty of
violating any state law against strikes by public employees, the member's benefits are forfeited.
If the member's designated beneficiary is found guilty of intentionally killing or procuring the death of
the member, the beneficiary forfeits all rights to retirement benefits. Any benefits payable would then
be paid as if the beneficiary died before the member.
The Clerk of the Court, the Secretary of the Senate or the employer, as appropriate, must notify the
Commission on Ethics if the member is found guilty, impeached, or terminated prior to retirement due
to any of the above offenses. The Commission on Ethics will notify the Division. The member's benefits
will be suspended subject to a hearing held by a hearing officer of the Division of Administrative
Hearings. The hearing officer's decision may be appealed to the District Court of Appeal.
(See s. 112.3173, F.S., and Article 11, Section 8, of the Florida Constitution for more information.)
Assignment, Execution, or Attachment
Retirement benefits and accumulated contributions accrued under the Florida Retirement System
Pension Plan are not subject to assignment, execution, attachment or any other legal process with the
exception of qualified domestic relations orders, certain income deduction orders (see s. 61.1301, F.S.),
and federal income tax levies.
REVISED OCTOBER 2004 PAGE 9
DEPARTMENT `OF MANAGEMENT S V 1M
"We serve those who
serve Florida"
JEB BUSH
Governor
Tom Lewis, Jr.
Secretary
MyFloaida. com
rw
Division of Retirement
Research & Education
Section
P.O. Box 9000
Tallahassee, Florida
32315 -9000
Telephone Numbers:
Toll Free:
877 - FRS -1 RES
(877- 377 -1737)
Local:
850 - 488 -5706
Suncom:
278 -5706
Fax:
850 - 921 -0371
Internet:
www.MyFlorida.com/frs
January 17, 2006
To: Florida Retirement System Agencies
Requesting Disclosure Information
From: Sarabeth Snuggs�
State Retirement Director
Subject: Actuarial Disclosure Information for 2004 -2005 Fiscal Year
Attached is disclosure information which you requested for the Florida Retirement
System (FRS) for the 2004 -2005 fiscal year, based upon the requirements of
GASB Statements 25 and 27 and including the results of the July 1, 2005
FRS Actuarial Valuation.
If you have any questions, you may email the Research & Education Section at
rep(�)dms.myflorida.com or telephone them toll -free at 877 -FRS -1 RES
(877- 377 - 1737), at 850 - 488 -5706 in the Tallahassee local calling area, or at
SUNCOM 278 -5706.
1 of 12
2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
Florida Retirement System
Information Required by GASB Statement 27
for Local Employers' Notes to Financial Statements
Plan Description
The Florida Retirement System (FRS) is a cost - sharing multiple- employer retirement plan. Benefit provisions are
established under Chapter 121, Florida Statutes, which may be amended by the Florida Legislature. A description of FRS
benefits under the defined benefit plan (FRS Pension Plan) is contained in the attached Plan Description. Beginning in
2002, a defined contribution plan alternative to the existing defined benefit plan known as the Public Employee Optional
Retirement Program or the FRS Investment became available to FRS members.
II. Funding Policy
The FRS funding policy provides for monthly employer contributions at actuarially determined rates that, expressed as
percentages of annual covered payroll, are adequate to accumulate sufficient assets to pay benefits when due (See Plan
Description attachment for current rates). Level percentage of payroll employer contribution rates, established by state
law, are determined using the entry-age actuarial cost method. If an unfunded actuarial liability reemerges as a result of
future plan benefit changes, assumption changes, or methodology changes, it is assumed any unfunded actuarial liability
would be amortized over 30 years, using level dollar amounts. Except for gains reserved for rate stabilization, it is
anticipated future actuarial gains and losses are amortized on a rolling 10% basis, as a level dollar amount.
Note:
Although GASB 27 does not require an employer that participates in a cost - sharing multiple - employer plan to disclose
Required Supplementary Information, the attached FRS Required Supplementary Information is included for your
information. The complete financial report of the FRS may be obtained by writing Division of Retirement, PO BOX 9000
Tallahassee, Florida, 32315 -9000; or by contacting Research & Education by email at rep dms.myflorida.com, or by
phone toll -free at 877 -FRS -1 FRS (877- 377 - 1737), at 850 - 488 -5706 in the Tallahassee local calling area, or at
SUNCOM 278 -5706.
2 of "12
2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
Schedule of Employer Contributions
(Dollar amounts in thousands)
Year Ended June 30
Annual Required
REQUIRED SUPPLEMENTARY INFORMATION
Contributions
Contributed
GASB
Statement # 25
100%
1999
3,102,984
100%
Schedule of
Funding Progress
111%,
2001
1,869,731
110%
(Dollar amounts in thousands)
1,825,485
97%
2003
Actuarial
Actuarial
Actuarial
Unfunded AAL
Funded
Annualized
UAAL as a
Valuation Date
Value of
Accrued
(UAAL)
Ratio
Covered
Percentage of
Assets
Liability (AAL)
(b -a)
(a/b)
Payroll'
Covered
(a)
Entry Age
(c)
Payroll
(b)
((b -a) /c)
July 1, 1998
$66,997,227
$63,205,829
($3,791,398)
106.00%
$18,010,189
- 21.05%
July 1, 1999
77,795,313
68,575,249
(9,220,064)
113.45%
18,998,086
- 48.53%
July 1, 2000
88,503,838
74,948,950
(13,554,888)
118.09%
20,463,403
- 66.24%
July 1, 2001
95,517,948
80,993,718
(14,524,230)
117.93%
21,360,862
- 67.99%
July 1, 2002
99,405,677
86,469,774
(12,935,903)
114.96%
22,195,184
- 58.28%
July 1, 2003
101,906,724
89,251,331
(12,655,393)
114.18%
22,270,807
- 56.83%
July 1, 2004
106,707,426
95,185,433
(11,521,993)
112.10%
23,115,581
- 49.85%
July 1, 2005
111,539,878
103,917,955
(7,621,923)
107.33%
24,185,983
- 31.51%
Schedule of Employer Contributions
(Dollar amounts in thousands)
Year Ended June 30
Annual Required
Percent
Contributions
Contributed
1998
$3,184,912
100%
1999
3,102,984
100%
2000
1,969,057
111%,
2001
1,869,731
110%
2002
1,825,485
97%
2003
1,844,203
98%
2004
2,044,540
92%
2005
2,141,862
102%
Notes to Required Supplementary Information
The information presented in the required supplementary schedules was determined as part of the actuarial valuations at
the dates indicated. Additional information as of the latest actuarial valuation follows:
Valuation date
Actuarial cost method
Amortization method
Equivalent Single amortization period
Asset valuation method
Actuarial assumptions:
Investment rate of return
Projected salary increases
Includes inflation at
Cost -of- Living Adjustments
July 1, 2005
Entry Age Normal
Level Dollar of Pay, Open
30 Years'
5 -year Smoothed Method
7.75%
6.25 %4
3.00%
3.00%
1 Payroll reported July 1,1999 and after Includes Deferred Retirement Option (DRO1) payroll.
2 The 201111 required annual contributions and the corresponding percent contributed were restated to reflect a change in the annual required contribution through the use of actuarially determined
surplus.
3 Used for GASB 27 reporting purposes.
4 Includes individual salary growth of 4.00% plus an age - and service - graded merit scale defined by gender and employment class. See Table A -2 of the July 1, 2005 actuarial valuation report for merit
scale.
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
SUMMARY PLAN DESCRIPTION
The following summary is a brief description of the Florida Retirement System Pension Plan as of June 30,
2005. Questions of interpretation shall be determined from part I of chapter 121, Florida Statutes, and
chapter 60S of the Florida Administrative Code.
Creation
The Florida Retirement System (FRS) was created December 1, 1970, with consolidation of 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 also consolidated with the FRS. The system was
created to provide a program offering retirement, disability, and survivor benefits for participating public
employees. Social Security coverage is also required for all members.
Membership
Membership in the FRS is compulsory for all full -time and part -time employees working in regularly
established positions for state agencies, county governments, district school boards, state universities,
community colleges, or participating cities or special districts. Certain members, including elected officials and
local government senior managers, may elect to not participate in the system. Members of the Elected Officers'
Class may elect to participate in the Senior Management Service Class in lieu of the Elected Officers' Class or to
withdraw from the FRS altogether. The following members may elect to participate in various optional
programs instead of the FRS:
• Most pension plan members (including renewed members), Senior Management Service Optional
Annuity Program participants, and Community College Optional Retirement Program participants may
elect to participate in the Public Employee Optional Retirement Program (FRS Investment Plan).
Participants of the State University System Optional Retirement Program or FRS Pension Plan
members who retired to join the Deferred Retirement Option Program (DROP) are not eligible to
participate in this plan;
• Senior Management Service Class members who are state employees (including state -level Elected
Officers' Class members who choose to join that class) may elect to participate in the Senior
Management Service Optional Annuity Program, while locally designated members of the class may
elect to opt out of the system altogether;
• State University System faculty and administrative and professional employees may elect to
participate in the State University System Optional Retirement Program; and
• Community College System faculty and certain administrators may elect to participate in a Community
College Optional Retirement Program, if the college offers an optional retirement program.
Classes of Membership
Regular Class — This class consists of members of the FRS who do not qualify for membership in the Special
Risk, Special Risk Administrative Support, Elected Officers', or Senior Management Service Classes.
Special Risk Class — This class consists of members who meet the criteria to qualify for this class as set forth in
Florida Law and Rules, and who are employed as:
• Law enforcement officers;
• Firefighters (including fire prevention and firefighter training positions, and aerial firefighting
surveillance pilots for the Department of Agriculture and Consumer Services);
• CorrectionaI officers or community -based correctional probation officers;
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
• Paramedics or emergency medical technicians whose primary duty and responsibility includes on -the-
scene emergency medical care and who is employed with a licensed Advance Life Support (ALS) or
Basic Life Support (BLS) employer;
• Professional health care workers in specified positions within the Department of Corrections or the
Department of Children and Family Services who spend at least 75% of their time performing duties
that involve contact with patients or inmates in a correctional or forensic facility or institution; or
• Youth custody officers with the Department of Juvenile Justice.
Special Risk Administrative Support Class — This class consists of special risk members who are transferred or
reassigned to a non - special -risk law enforcement, firefighting or correctional administrative support position
within an FRS special risk employing agency and meet the criteria set forth in Florida Law.
Elected Officers' Class (EOC) — This class consists of members who hold specified elective offices in either state
or local government:
• State officers include: Governor, Lieutenant Governor, Cabinet Officer, Legislator, Supreme Court
Justice, district court of appeal judge, circuit judge, county court judge, state attorney, and public
defender.
• County officers include: sheriff, tax collector, property appraiser, supervisor of elections, school board
member, school board superintendent, clerk of circuit court, and county commissioner.
• City or special district officers include: Those elected officials in cities and special districts that have
chosen to place their elected officials in the EOC.
Senior Management Service Class (SMSC) — This class consists of:
• Members of the Senior Management Service of state government;
• Community college presidents;
• Appointed school board superintendents;
• County and city managers;
• Selected managerial staff of the Legislature;
• The Auditor General and managerial staff;
• The Executive Director of the Ethics Commission;
• The State University System Executive Service and university presidents;
• Selected managerial staff of the State Board of Administration;
• Judges of compensation claims;
• Selected managerial staff with the Judicial Branch;
• Capital collateral regional counsels and assistant capital collateral regional counsels;
• Assistant state attorneys;
• Assistant public defenders;
• Assistant statewide prosecutors or assistant attorneys general;
• Elected officials who chose to join the SMSC in lieu of the EOC;
• Nonelective managerial positions designated for SMSC membership by local government agencies;
and
• Chief Deputy Court Administrator.
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
Contributions
Retirement coverage is employee noncontributory. Employers pay all contributions. Effective July 1, 2002, the
Florida Legislature established a uniform contribution rate system for the Florida Retirement System (FRS),
covering both the FRS Pension Plan and the FRS Investment Plan. Including the fee of 0.08% for administration
of the FRS Investment Plan and provision of educational tools for both plans, the uniform rates for FY 2004/05
are as follows:
Class
Rate
Regular..................................................................................................... ...............................
6.28%
SpecialRisk .................................................................... ............................... .........................17.42%
Special Risk Administrative Support .............................. ............................... ...........................8.81
%
Elected Officers
Judges................................................................... ............................... .........................17.54%
Governor, Lt. Governor, Cabinet, Legislators,
State Attorneys, and Public Defenders .................... ............................... .........................11.38%
Elected County Officials (in EOC) ........................... ............................... .........................14.12%
Senior Management Service ........................................... ............................... ..........................8.26%
Deferred Retirement Option Program (DROP) .............. ............................... ..........................8.00%
Note: To offset the rates shown above, a portion of the normal cost has been prefunded from surplus actuarial
assets for all rates. These rates do not include the separate 1.11 % contribution for the Retiree Health
Insurance Subsidy.
Any member who terminates employment with an FRS employer may receive a refund of any retirement
contributions personally made to the system (and lose the associated retirement credit), or may leave these
personal contributions in the system and keep all creditable service earned through the date of termination.
Creditable Service
Members receive 1 month of service credit for each month in which any salary is paid for work performed.
Members may also purchase additional credit to increase their retirement benefits under the FRS. Credit may
be purchased for past service, prior service (including refunded service credit), certain military service (up to
4 years), approved leaves of absence (up to 2 years), out -of -state public service (including federal service), non -
FRS public service and non - public service in certain schools or colleges in Florida (up to 5 years total,
including both in -state and out -of -state service), and in some cases credit for periods of disability. To purchase
this service credit, members must meet certain requirements. Only the purchase of past service and prior
service may be included in the creditable years of service needed to vest (see next section). All other types of
service credit purchases become creditable service only after a member is vested based on his /her other
service.
Vesting
Since July 1, 2001, the FRS has provided for vesting of benefits after 6 years of creditable service. Members not
employed in a position covered by the FRS on July 1, 2001, may be required to return to covered employment
for up to 1 work year to be eligible to vest with less service than was required under the law in effect before
July 1, 2001.
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
Service Retirement
Members become eligible for normal retirement based on their age and /or service when they meet the
minimum requirements listed in the following section. Early retirement may be taken any time after a member
has vested; however, there is a 5% benefit reduction for each year remaining from a member's retirement date
to his /her normal retirement age.
Normal Retirement Requirements
Regular Class, Elected
Six years of service and age 62, the age after 62 the member
Officers' Class, and Senior
becomes vested, or thirty years of service, regardless of age,
Management Service Class
whichever comes first.
Special Risk Class
Six years of special risk service and age 55; or
Twenty -five total years of service, consisting of both special risk
service and up to four years of military service, and age 52; or
Twenty -five total years of special risk service, regardless of age; or
Thirty years of any creditable service, regardless of age.
Special Risk Administrative
Special risk normal retirement requirements apply to service in this
Support Class
class if member has six years actual special risk service;
otherwise Regular Class requirements apply.
Benefit Calculation
Service retirement benefits are computed on the basis of age and /or years of service, average final
compensation (AFC), and service credit. Credit for each year of service is expressed as a percentage of AFC
(the average of the 5 highest fiscal years of earnings). The total percentage value of the benefit received is
determined by calculating the total value of all service, which is based on the retirement plan and /or class to
which the member belonged when the service credit was earned. The following chart shows the percentage
value for each year of service credit earned:
VALUE
RETIREMENT PLAN (per year of service)
State and County Officers' and Employees' Retirement System (SCOERS)
Division A (no Social Security) ..................................................................... ............................... 2.00%
Division B (with Social Security) .................................................................. ............................... 1.50%
Teachers' Retirement System (TRS)
PlanE .............................................................................................................. ............................... 2.00%
Florida Retirement System (FRS)
Regular Class
Retirement at age 62 or with 30 years of service ....................................... ............................... 1.60%
Retirement at age 63 or with 31 years of service ....................................... ............................... 1.63%
Retirement at age 64 or with 32 years of service ....................................... ............................... 1.65%
Retirement at age 65 or with 33 or more years of service .......................... ............................... 1.68%
Special Risk Class
Service from 1211/70 through 9/ 30/ 74 ........................................................ ............................... 2.00%
Serviceon and after 10/ 1/ 74 ...................................................................... ............................... 3.00%
Special Risk Administrative Support Class
(With 6 years of special risk service, the service in this class counts towards special risk normal retirement; otherwise,
Regular Class requirements apply.)
Retirement at age 55; or with 25 total years special risk service;
or at age 52 with 25 years (if total service includes military service) ... ............................... 1.60%
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
Retirement at age 56; or with 26 total years special risk service;
or at age 53 with 26 years (if total service includes military service) ... ............................... 1.63%
Retirement at age 57; or with 27 total years special risk service;
or at age 54 with 27 years (if total service includes military service) ... ............................... 1.65%
Retirement at age 58; or with 28 total years special risk service;
or at age 55 with 28 years (if total service includes military service) ... ............................... 1.68%
Elected Officers' Class
Service as Supreme Court Justice, district court of appeal judge,
circuit court judge, or county court judge ............................................ ............................... 3.33%
Service as Governor, Lt. Governor, Cabinet Officer, Legislator, state attorney,
public defender, elected county officer, or elected official of a city or special
district that chose EOC membership for its elected officials ............... ............................... 3.00%
Senior Management Service Class ............................................................. ............................... 2.00%
There are three steps in computing an annual retirement benefit:
Step 1. Determine the member's retirement plan(s) and class(es) of membership, years of creditable
service in each, and the total percentage value earned.
Step 2. Calculate the average final compensation (AFC).
Step 3. Multiply the figures obtained in Steps 1 and 2 to determine the annual normal retirement benefit.
Benefit Options
Members must select one of the following four benefit options at retirement:
Option 1 — Member receives a benefit for life with no continuing survivor benefit at death.
Option 2 — Member receives a reduced benefit for life. If member dies anytime within 10 years after
retiring, the beneficiary will receive the benefit for the remainder of the 10 years.
Option 3 — Member receives a reduced benefit for life. Upon the member's death, the joint annuitant, if
living, will receive the same benefit for the remainder of his or her life. A joint annuitant who
is under age 25 and is the member's child or other dependent for whom the member has
guardianship will receive the member's maximum benefit, but only until age 25, or, if
disabled, until he or she is no longer disabled.
Option 4 — Member receives a reduced benefit for life. Upon the death of either the member or the joint
annuitant, the survivor will receive a lifetime benefit equal to two -thirds of the benefit the
member was receiving when both were living. A joint annuitant who is under age 25 and is the
member's child or other dependent for whom the member has guardianship will receive the
member's maximum benefit, but only until age 25, or, if disabled, until he or she is no longer
disabled.
Termination
To receive monthly benefits payable under the FRS Pension Plan, eligible members must end all employment
relationships with all FRS employers for 1 calendar month, or begin participation in the Deferred Retirement
Option Program (DROP). Members who elect to participate in DROP must remain off all FRS payrolls for 1
calendar month at the end of their program participation. (Special DROP termination provisions may apply as
described in the following section.)
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
Deferred Retirement Option Program
The Deferred Retirement Option Program (DROP) is available under the FRS Pension Plan when the member
first reaches eligibility for normal retirement. DROP allows a member to retire while continuing employment for
up to 60 months. While in DROP, the member's retirement benefits accumulate in the FRS Trust Fund (increased
by a cost -of- living adjustment each July) and earn monthly interest equivalent to an annual rate of 6.5 %.
The election to participate in DROP must be made within 12 months of the member's normal retirement date,
unless the member is eligible to defer the election. To participate for the maximum DROP period, the member
must enter DROP upon first reaching eligibility for normal retirement, or upon reaching an eligible deferral
date as described below:
• A Special Risk Class member or a Special Risk Administrative Support Class member (with 6 years of
Special Risk Class service) who reaches his or her normal retirement date based upon years of service
before reaching age 52 may defer DROP entry up to age 52 and still participate for 60 months.
• A member of the Regular Class, Elected Officers' Class, or the Senior Management Service Class who
reaches his or her normal retirement date before reaching age 57 may defer DROP entry until age 57
and still participate for 60 months.
• A member of the Elected Officers' Class who reaches his or her normal retirement date during a term
of office may defer the DROP election until the next succeeding term in that office and still participate
for up to 60 months or until the end of that succeeding term, whichever is less.
• A member who is employed as K -12 instructional personnel as defined in s. 1012.01(2), F.S., may elect
to participate in DROP at any time after reaching his or her normal retirement date.
Upon termination, the DROP account is paid out as a lump sum payment, a rollover, or a combination partial
lump sum payment and rollover, and monthly benefits are paid to the member in the amount as calculated
upon entry into DROP, plus cost -of- living adjustments for intervening years.
In most cases, the DROP participant must cease employment after a maximum of 60 months in DROP, must
satisfy the termination requirements for retirement, and must comply with applicable reemployment
restrictions thereafter. However, certain exceptions apply:
• Effective July 1, 2002, a DROP participant who holds an elective office covered by the Elected Officers'
Class may end DROP participation and postpone compliance with termination requirements and
reemployment limitations until he or she no longer holds the elective office (including consecutive
terms in the same office). For the period between the end of DROP participation and termination, no
retirement credit is earned and the member's DROP accumulation accrues no additional monthly
benefits (but continues to earn interest).1
• Since June 1, 2003, K -12 instructional personnel employed with a district school board or the Florida
School for the Deaf and the Blind may extend their DROP participation for up to an additional 36
months beyond their initial 60 -month DROP participation period. To qualify for the extension, the
DROP participant must receive authorization from the Division and from the district school
superintendent or the Board of Trustees of the School for the Deaf and the Blind, as appropriate. If
authorized to extend DROP participation, a participant must remain employed in an eligible position.
Notwithstanding these provisions, any elected officer who entered DROP on or before June 30, 2002, is subject to prior
provisions of law and may end DROP without terminating employment and be automatically enrolled as a renewed
member of the Elected Officers' Class.
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
• Since June 23, 2004, K -12 instructional personnel employed by a developmental research school may
extend DROP participation up to an additional 36 months beyond their initial 60 -month DROP
participation period. To qualify for the extension, the DROP participant must receive authorization
from the Division and from the developmental research school's director (or principal if there is no
director), as appropriate. If authorized to extend DROP participation under this provision, a
participant must remain employed in an eligible position.
Employers pay contributions at a rate of 8.00% of salary for all DROP participants.
Disability Benefits
Two types of disability retirement are available under the FRS: In- line -of -duty disability retirement and
regular disability retirement. To qualify for either type of disability retirement, members must be totally and
permanently disabled to the extent that they are unable to work. In- line -of -duty disability benefits are
available to members on their first day of employment. The minimum Option 1 benefit for in- line -of -duty
disability retirement is 42% of AFC for all members except those in the Special Risk Class, who receive a
minimum Option 1 in- line -of -duty disability benefit of 65% of AFC. To be eligible for regular disability
retirement, members must complete 8 years of creditable service. The minimum Option 1 benefit under
regular disability retirement is 25% of AFC. If a disabled member's service benefit would be higher than the
minimum disability benefit, the higher benefit is paid.
Survivor Benefits
If an active member dies in the line of duty, his /her spouse will receive a monthly benefit equal to one -half of
the member's monthly salary at death, payable for the spouse's lifetime. If the spouse dies, the benefit will
continue to the member's children until the youngest child reaches age 18 or is married, if earlier.
If an active member dies before becoming vested and his /her death was not suffered in the line of duty, the
designated beneficiary will receive a refund of any member -paid retirement contributions. However, if the
active member dies within 1 year of vesting, the member's joint annuitant may use the deceased member's
accumulated leave on an hour -by -hour basis, or the member's eligible in -state or out -of -state service, to
purchase enough service credit to vest the deceased member and receive monthly benefits.
If the member was vested at death, the beneficiary may receive a refund of any contributions that may have
been paid by the member or, if the beneficiary qualifies as a joint annuitant, he or she may receive a lifetime
monthly benefit calculated as though the member had retired on the date of death and had chosen Option 3. If
the joint annuitant is the member's child or other dependent who is under age 25 and for whom the member
has guardianship, he or she will receive the member's maximum benefit only until age 25, or, if disabled, until
no longer disabled. A deceased member's joint annuitant may buy any service credit that could have been
claimed by the member at the time of death.
Cost -of- Living Adjustments
The benefits received by retirees and beneficiaries are increased by a 3% cost -of- living adjustment (COLA)
each July based on their June benefit amount (excluding the Retiree Health Insurance Subsidy benefit). For
retirees who have received benefits for less than 12 months on July 1, the increase is prorated. The COLA
applies to all continuing monthly retirement benefits paid under the FRS Pension Plan (i.e., normal and early
service retirement benefits and benefits accruing in participant accounts under DROP, disability retirement
benefits, and survivor benefits).
Reemployment after Retirement
After retirement or DROP termination, retired FRS members may be reemployed by any private employer or
any public employer not participating in the FRS without affecting his /her FRS benefits. However, restrictions
apply to reemployment with an FRS employer. Any retired FRS member who is employed by an FRS
10 of 12
2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
employer during the first calendar month after retirement or DROP termination is not considered to have
terminated employment and is therefore not considered to have retired. His /her active membership will be
reinstated.
Upon meeting termination requirements, FRS retirees who are reemployed by FRS employers may not receive
both salary and retirement benefits for the rest of the 12 -month period after retirement, and must forfeit
retirement benefits for the months employed. Exceptions to the reemployment restrictions allow FRS retirees
to be reemployed in specified positions during the 2nd through 12th months of retirement without forfeiting
benefits. After being retired for 1 month, retirees may be reemployed without further limitation in specified
positions with district school boards, the Florida School for the Deaf and the Blind, developmental research
schools, and participating charter schools. Retirees may also be reemployed for up to 780 hours in specified
positions by a state community college or a university in the State University System, or by FRS employers as
firefighters or paramedics. Finally, retired judges called to temporary duty and retirees appointed to or voted
into elective office are exempt from reemployment limitations after being retired for 1 month.
Renewed Membership
Retirees of the FRS who are reemployed in regularly established positions will have renewed membership in
the Regular Class, the Senior Management Service Class (SMSC), or the Elected Officers' Class and earn credit
toward a second - career benefit based on requirements for their class of membership. Once retirees have
established renewed membership in the system, they will have the same opportunities to elect to participate in
alternative retirement programs, or to withdraw from the system altogether, as do similarly situated regular
members of that membership class. Renewed members will be subject to the same vesting requirements and
other limitations as apply to other active members. However, renewed members are not eligible to participate
in the Special Risk Class, to participate in the Deferred Retirement Option Program, to participate in the State
University System Optional Retirement Program (SUSORP), or to retire under disability retirement provisions.
Appeals Procedure
Whenever the Division makes a decision that will reduce, suspend or terminate a member's retirement
benefits, the member may petition the Division for a hearing. Section 28- 106.201, F.A.C., outlines the
requirements for filing a petition. After the Division reviews the petition, the State Retirement Director may
ask a hearing officer from the Division of Administrative Hearings to conduct the hearing, or in some cases the
Department of Management Services may conduct the hearing. If the outcome of the hearing is not in the
member's favor, the member will be informed of the time period during which he or she can appeal the
decision to the District Court of Appeal.
Forfeiture of Benefits
If, before retirement, a member commits a felony specified by law and is found guilty of or enters a plea of no
contest to such crime, or their employment was terminated due to admission of committing, aiding, or abetting
a specified crime, the member's retirement rights and benefits are forfeited (except for a refund of personal
retirement contributions, if any). The forfeiture of benefits provision applies in the case of any job - related
felony offense as outlined below:
• Committing, aiding or abetting an embezzlement of public funds or any grand theft from the
employer;
• Committing bribery in connection with employment;
• Committing any other felony specified in chapter 838, F.S., (bribery and misuse of public office),
except ss. 838.15 and 838.16, F.S., (commercial bribes);
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2005 FRS Valuation Summary with Required Supplementary Information January 17, 2006
• Committing any felony with intent to defraud the public or the employer of the right to receive the
faithful performance of duty, or receiving or attempting to receive profit or advantage for the member
or another person through the use of his or her position; or
• Committing an impeachable offense (applies to elected officials only).
In addition to the crimes stated above, if a court of competent jurisdiction finds the member guilty of violating
any state law against strikes by public employees, the member's benefits are forfeited.
If the member's designated beneficiary is found guilty of intentionally killing or procuring the death of the
member, the beneficiary forfeits all rights to retirement benefits. Any benefits payable would then be paid as if
the beneficiary died before the member.
The Clerk of the Court, the Secretary of the Senate or the employer, as appropriate, must notify the
Commission on Ethics if the member is found guilty, impeached, or terminated prior to retirement due to any
of the above offenses. The Commission on Ethics will notify the Division. The member's benefits will be
suspended subject to a hearing held by a hearing officer of the Division of Administrative Hearings. The
hearing officer's decision may be appealed to the District Court of Appeal. (See s. 112.3173, F.S., and Article 11,
Section 8, of the Florida Constitution for more information.)
Assignment, Execution, or Attachment
Retirement benefits and accumulated contributions accrued under the Florida Retirement System Pension Plan
are not subject to assignment, execution, attachment or any other legal process with the exception of qualified
domestic relations orders, certain income deduction orders (see s. 61.1301, F.S.), and federal income tax levies.
12 of 12
FRS
(nvestrEt Plan
FLORIDA RETIREMENT SYSTEM
SUMMARY PLAN DESCRIPTION
FRS INVESTMENT PLAN
September 1, 2005
DISCLAIMER........................................................................................ ............................... 2
INTRODUCTION................................................................................... ...............................
3
THEFRS INVESTMENT PLAN ............................................................ ...............................
3
What is the FRS Investment Plan? ................................................. ...............................
3
How is the FRS Investment Plan Administered? .......................... ...............................
4
What are the requirements for FRS membership and voluntary participation in the
FRSInvestment Plan? ..................................................................... ...............................
5
What are the eligibility requirements for participation in the FRS Investment Plan ?5
When am I vested in the FRS Investment Plan and what is normal retirement age?
6
As a new employee, how do I enroll in the FRS Investment Plan? ............................
6
HOW THE FRS INVESTMENT PLAN OPERATES .............................. .......................... ......
7
What are the FRS Membership Classifications? ........................... ...............................
7
How are contributions made to my account in the FRS Investment Plan? ...............
8
What investment options are available in the FRS Investment Plan ? ........................
9
How can I change my investment options in the FRS Investment Plan? ..................
9
What is the Excessive Fund Trading Policy? ................................ ...............................
9
What is my creditable service? .................................................... ...............................
10
What are the various types of employment status? ................... ...............................
10
Can I return to employment after I retire? ................................... ...............................
11
How can I make a beneficiary designation? ................................ ...............................
12
What are my rights to a benefit? .................................................. ...............................
12
DISTRIBUTIONS FROM THE FRS INVESTMENT PLAN .................. ...............................
13
How can I take distributions from the FRS Investment Plan? ..... .............................13
What taxes are payable on distributions? ................................... ...............................
15
What charges are assessed on accounts in the FRS Investment Plan ? ..................
15
THE SECOND ELECTION .................................................................. ...............................
16
BENEFITS........................................................................................... ...............................
17
Disabilitybenefits .......................................................................... ...............................
17
Deathbenefits ................................................................................ ...............................
18
Health Insurance Subsidy ( HIS) .................................................... ...............................
18
Do I forfeit my retirement benefits if I commit a crime? ............. ...............................
19
COMPLAINT PROCEDURES ............................................................. ...............................
19
OTHER FRS INVESTMENT PLAN INFORMATION ........................... ...............................
20
Situations which may affect your FRS Investment Plan benefits .............................
20
What is the process for amendments to the plan or for termination of the plan?..
20
What is the policy regarding errors and incorrect or incomplete data ? ..................
21
What are my rights regarding employment in the FRS Investment Plan ? ...............
21
What are my rights to assign benefits? ....................................... ...............................
21
RETIREMENT PLAN ROLL OVERS TO THE INVESTMENT PLAN . ...............................
21
WHERE SHOULD I GO FOR MORE INFORMATION? ...................... ...............................
22
WHAT IS THE FINANCIAL GUIDANCE AND ADVICE POLICY? ..... ...............................
22
GLOSSARY........................................................................................ ...............................
24
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DISCLAIMER
This summary plan description is a summary of the main provisions of the Public Employee
Optional Retirement Program (also known as the Florida Retirement System Investment Plan). It
is not intended to include every program detail. Complete details can be found in Chapter 121,
Florida Statutes, and the rules of the State Board of Administration of Florida in Title 19, Florida
Administration Code. In case of any conflict between this summary plan description and the
statutes and rules, the provisions of the statutes and rules will control.
The information provided in this brochure is based on the Florida Retirement System (FRS) laws
and rules in existence on July 1, 2005, and is subject to modification based on changes in the law
in Chapter 121, Florida Statutes, or the rules as found in Rule Titles19 and 60 Florida
Administrative Code.
Although participating FRS employers have certain obligations under section 121.4501(10)(h),
Florida Statutes, to regularly communicate the existence of both the FRS Pension Plan and FRS
Investment Plan, as well as the plan choice available to employees under the FRS, they are not
agents of the State Board of Administration of Florida (SBA). You may obtain information on the
Florida Retirement System from a participating employer; however, the SBA is not responsible for
erroneous information provided by representatives of these participating employers.
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INTRODUCTION
Financial security when you retire is an important goal, and one that the Florida Retirement System
(FRS) can help you achieve. The FRS has two retirement plans from which eligible employees can
choose to help them meet their retirement goals: the FRS Pension Plan (defined benefit) and the
FRS Investment Plan (defined contribution). Your employer makes all contributions to the plan you
choose.
Each FRS plan is designed to provide you with a good foundation for financial security when
considered along with Social Security, other retirement programs, and your own personal savings
(including savings accounts, IRAs, and deferred compensation programs offered through your
employer, among other resources).
This document is a description of one of these plans: the FRS Investment Plan.
The FRS also offers free retirement planning support through the MyFRS Financial Guidance
Program, which can help all FRS members better prepare for their retirement.
THE FRS INVESTMENT PLAN
What is the FRS Investment Plan?
The FRS Investment Plan is a defined contribution retirement plan qualified under section 401(a) of
the Internal Revenue Code. This means that employer contributions are made to each
participant's account under the plan. These employer contributions are set by state law based on
retirement membership class, as described below. The term "defined contribution" for the FRS
Investment Plan means that employer contributions are defined; in the FRS Pension Plan, the
benefit is defined. Your employer's contributions are deposited in an account established for you
under the FRS Investment Plan. Benefits are based on the total value of your account at
distribution. This amount is based on employer contributions, plus interest and earnings on those
contributions, less fees and plan charges.
The Florida Legislature enacted this optional retirement plan during the 2000 legislative session.
Its formal name, as set out in Part II of Chapter 121, Florida Statutes, is the "Public Employee
Optional Retirement Program." However, in order to provide a strong contrast with the existing
retirement plan, the defined benefit plan, the State Board of Administration of Florida (SBA), which
is responsible for establishing the program, calls the defined benefit program the FRS Pension
Plan and calls the defined contribution program the FRS Investment Plan. This document will use
the term FRS Investment Plan.
Since the FRS Investment Plan is a governmental plan, the plan documents are the Florida
statutes enacting this plan, which may be found and reviewed through the MyFRS.com web site.
All Florida Statutes are subject to amendment or deletion each year during Florida's legislative
sessions. Consequently, all statements in this Summary Plan Description are subject to legislative
change. Where there are discrepancies between the Florida Statutes and this document, the
Florida Statutes control. Similarly, all rules adopted by the SBA to implement this plan must
conform to the Florida Statutes. But if the Florida Legislature changes the statute, a rule might no
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longer conform. In that circumstance, the SBA is required to amend the rule so that it conforms to
the statute.
Therefore, the controlling policies and procedures for the FRS Investment Plan are the Florida
Statutes and any rules which properly implement those statutes.
How is the FRS Investment Plan Administered?
The SBA, along with its contractual partners and participating FRS employers, and with the
assistance of the Division of Retirement within the Department of Management Services, is
required by statute to implement and administer the FRS Investment Plan.
• Official Plan Name: Florida Retirement System Public Employee Optional Retirement
Program.
• Common Plan Name: FRS Investment Plan
• Type of Plan: Defined Contribution Retirement Plan qualified under section 401(a) of the
Internal Revenue Code.
• Federal Employer Identification Number: 59- 6001872
• Plan Number: 002
• Plan Sponsor: State Board of Administration of Florida (SBA). The SBA is charged with
establishing this plan.
• Plan Trustees: Executive Director, State Board of Administration of Florida, representing
the Governor, the Chief Financial Officer and the Attorney General as the Trustees of the
Board. The address for the Executive Director is: Executive Director, State Board of
Administration of Florida, 1801 Hermitage Blvd., Suite 100, Tallahassee, Florida 32308.
The address for each of the three Trustees of the Board is: The Capitol, Tallahassee,
Florida 32399.
• Plan Documents are the Florida Statutes and the rules of the State Board of
Administration establishing the Plan: Chapter 121, Parts II and III, Rule Title 19, Florida
Administrative Code.
• Plan Year: July 1 through June 30.
• Source of Benefit Payments: All benefits payable under the Investment Plan shall be
paid solely from your individual retirement account within the Public Employee Optional
Retirement Program Trust Fund.
• Agent for Service of Legal Process: Executive Director, State Board of Administration of
Florida, 1801 Hermitage Blvd., Suite 100, Tallahassee, Florida 32308.
• Name of Plan Administrator: CitiStreet, FRS Investment Plan Administrator, P.O. Box
56290, Jacksonville, Florida 32241 -6290; telephone: 1- 866 - 446 -9377. This is a toll -free
number.
• Date plan effective: The plan became effective July 1, 2000, although the first members in
the plan were effective July 1, 2002.
• Name of Employer: Your FRS employing agency
As a state governmental plan, the Employee Retirement Income Security Act of 1974 (ERISA)
does not apply except to the extent certain sections of that federal law are incorporated into Florida
law. Section 121.4501(15), Florida Statutes, incorporates the federal law concept of fiduciary
responsibility on the part of the Trustees of the SBA, codified at 29 U.S.C. 1104(a)(1)(A) -(C), and
also incorporates the federal law concept of participant control, established by regulations of the
U.S. Department of Labor under section 404(c) of ERISA.
Under the concept of fiduciary responsibility, the Trustees of the SBA shall ensure that investment
of FRS Investment Plan assets shall be made for the sole interest and exclusive purpose of
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providing benefits to plan participants and beneficiaries and defraying reasonable expenses of
administering the plan.
Under the concept of participant control, if you, as a participant, exercise control over your assets
in the FRS Investment Plan, pursuant to section 404(c) regulations and all applicable laws
governing the operation of the FRS Investment Plan, no program fiduciary shall be liable for any
loss to your account that may result from your exercise of that control.
What are the requirements for FRS membership and voluntary participation in the
FRS Investment Plan?
Membership in the FRS is required for all full -time and part-time employees working in a regularly
established position for a state agency, county government, district school board, state university,
community college, or participating city or special district. Elected officials may elect not to
participate in the FRS retirement program. And employees of the Elected Officers' Class (EOC)
may elect to participate in the Senior Management Service Class in lieu of the Elected Officers'
Class. The following employees may elect to participate in other annuity or optional programs
instead of the FRS Investment Plan:
Senior Management Service Class employees (including Elected Officers' Class employees
who choose to join that class);
State University System faculty and administrative and professional employees; and
State Community College System faculty and certain administrators, if their college offers an
optional retirement program.
If an employee works in two or more jobs at the same time that are covered by different FRS
membership classes, the employee may be a member of only one class, which will be determined
as follows:
If the jobs are covered by different membership classes, and none of which is the Elected
Officers' Class, the member will be in the class in which he or she is employed for more than
half the time. When the employment is split equally, the member may choose the class of
membership he or she prefers.
If the jobs are covered by different FRS membership classes, and one of which is the EOC, the
member may choose to participate in any one class for which he or she is eligible.
If the member is required or chooses to be a member of the Regular Class, his or her total salaries
from all positions will be reported and used to calculate retirement service credit. When the
member is required or chooses to be a member of the Special Risk Class, the Special Risk
Administrative Support Class, the Senior Management Service Class, or the Elected Officers'
Class, only salary received from that position will be reported and used to calculate retirement
service credit.
What are the eligibility requirements for participation in the FRS Investment Plan?
As an FRS member, you are eligible to participate in the FRS Investment Plan unless you are a
participant in one of the following programs:
• Deferred Retirement Option Program (DROP), except that terminated DROP participants
may roll over their DROP proceeds into the Investment Plan as described in this document;
• State University System Optional Retirement Program (SUSORP);
• Teachers' Retirement System (TRS); or
• State and County Officers' and Employees' Retirement System (SCOERS).
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If you choose to participate in the FRS Investment Plan, your employer will contribute an amount to
your account every month equal to a percentage of your gross salary for the calendar month (for
example, 9% of gross salary for Regular Class employees; see description of membership classes,
below). You direct the investment of your account among the investment funds available through
the Plan.
Please understand that these eligibility requirements are established by the Florida Legislature and
codified in the Florida statutes. They are subject to change.
When am I vested in the FRS Investment Plan and what is normal retirement age?
For the FRS Investment Plan, if you have completed one year of service with an FRS employer,
you are vested in (or, you "own ") all contributions and earnings on those contributions. For the FRS
Investment Plan, there is no "normal retirement age." Instead, when your employment with all FRS
employers ends, you can take the value of your account with you, regardless of your age.
This is in contrast with the FRS Pension Plan. In the FRS Pension Plan, you need six years of
service to vest. Further, normal retirement age for Regular Class employees in the FRS Pension
Plan is the earlier of age 62 or attaining 30 years of service. If you have previous FRS Pension
Plan service that you may transfer to the FRS Investment Plan, that service will vest under the FRS
Pension Plan 6 -year vesting schedule.
In the FRS Investment Plan, you can take all of the contributions and earnings in your account
after vesting once you terminate employment with all FRS employers. Or you can roll the balance
over to another employer's retirement plan (if permitted by that plan), roll the balance over to an
IRA (Individual Retirement Account) or leave the value of your account in the FRS Investment Plan
until a later date when you may take a distribution. (See the Distributions From the FRS Investment
Plan section for more information)
Your retirement benefit will depend upon your account balance and the type of payout you choose
(e.g., quarterly withdrawals of 1% of the account value, monthly withdrawals, lifetime annuity,
lifetime annuity with annual 3% increase, etc.). Payout distribution options are discussed later.
Please understand that these vesting requirements and the normal retirement age are established
by the Florida Legislature and codified in the Florida Statutes. They are subject to change.
As a new employee, how do I enroll in the FRS Investment Plan?
Eligible new employees will be enrolled automatically in the FRS Pension Plan on their first day of
employment and may, within five months following their month of hire, elect to participate in the
FRS Investment Plan instead of the FRS Pension Plan. Enrollment in the FRS Investment Plan
will be retroactive to the date of hire. The FRS Investment Plan effective date will be established
as the first of the month following the month in which the enrollment form is received or the online
enrollment is processed by the Plan Administrator. From the date of hire until the effective date,
contributions will be paid at the blended contribution rate. From the effective date forward,
contributions will be paid at the full FRS Investment Plan contribution rate.
Your enrollment period will end at 4:00 p.m. Eastern Time, on the last business day of the fifth
month following your month of hire. If no active enrollment is made during this period you will
remain in the FRS Pension Plan.
All employees can use either the enrollment form for their retirement class available online at
MyFRS.com, or from your employer. If employed in a position covered under the Regular Class or
Special Risk Class of membership, you may optionally enroll online at MyFRS.com, by calling the
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toll -free MyFRS Financial Guidance Line at 1- 866 - 446 -9377, or by using the short ELE -1EZ
enrollment form available online at MyFRS.com.
Regardless of which enrollment method you use, the terms and conditions set out in the FRS ELE-
1 enrollment form will apply.
Example: If you are hired on April 15, you are automatically enrolled in the FRS Pension Plan.
You will have until the last business day in September to choose the FRS Investment Plan. If you
elect to join the FRS Investment Plan on May 3, your retirement plan transfer date (i.e., effective
date) to the FRS Investment Plan will be June 1. The employer contributions paid to the FRS on
your behalf between April 15 and May 30 will be the amounts required for the FRS Pension Plan
under the uniform contribution rate system specified in section 121.71, Florida Statutes. Those
amounts will be transferred to your FRS Investment Plan account and represent your opening
account balance in June. Thereafter, starting with the month of June, your employer will make the
required contributions based on your membership in the FRS Investment Plan. However, April 15
will be considered your beginning effective date for vesting purposes and for FRS Investment Plan
membership.
The contribution rates under the uniform contribution rate system are lower than the FRS
Investment Plan contribution rates. So, if you intend to enroll in the FRS Investment Plan, you will
be advantaged by enrolling early in your enrollment period.
HOW THE FRS INVESTMENT PLAN OPERATES
What are the FRS Membership Classifications?
Regular Class — This class consists of FRS employees who do not qualify for membership in the
Special Risk, Special Risk Administrative Support, Elected Officers, or Senior Management Service
Classes.
Special Risk Class — This class consists of employees who meet the criteria set forth in the
Florida Statutes and accompanying rules in the Florida Administrative Code to qualify for this class
and are employed as law enforcement officers, firefighters (including fire prevention and firefighting
training positions, and aerial surveillance pilots for the Department of Agriculture and Consumer
Services), correctional officers or community -based correctional probation officers, paramedics or
emergency medical technicians, certain professional health care workers employed by the
Department of Corrections and Department of Children and Family Services, in positions within
correctional and forensic facilities, youth custody officers, or certain forensic employees within a
law enforcement agency or medical examiner's office.
Special Risk Administrative Support Class — This class consists of special risk employees who are
transferred or reassigned to a non - special risk law enforcement, firefighting or correctional
administrative support position within an FRS special risk employing agency and meet the criteria
set forth in the Florida Statutes.
Elected Officers' Class (EOC) — This class consists of employees filling the office of Governor,
Lieutenant Governor, Cabinet Officer, Legislator, Supreme Court Justice, district court of appeal
judge, circuit judge, county court judge, state attorney, or public defender. Elected county officials
in the following offices may also belong to this class: sheriff, tax collector, property appraiser,
supervisor of elections, school board participant, school board superintendent, clerk of circuit court,
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and county commissioner. Additionally, cities and special districts have had two opportunities to
place their elected officials in the EOC.
Senior Management Service Class (SMSC) — This class consists of employees of the Senior
Management Service of state government, community college presidents, appointed school board
superintendents, county and city managers, selected managerial staff of the Legislature, the
Auditor General and selected managerial staff in the Office of the Auditor General, the Executive
Director of the Ethics Commission, the State University System Executive Service and university
presidents, selected managerial staff of the State Board of Administration of Florida, assistant state
attorneys, assistant public defenders, assistant statewide prosecutors, assistant attorneys general,
judges of compensation claims, capital collateral regional counsels and assistant capital collateral
regional counsels, and selected managerial staff with the Judicial Branch, as well as elected
officials who chose to join the SMSC in lieu of the EOC. Local government agencies may
designate additional non - elective managerial positions for SMSC membership.
How are contributions made to my account in the FRS Investment Plan?
Employers are required to submit retirement contributions no later than the fifth business day of
each month following the month wages are earned. Note that Florida law neither requires nor
permits you to make contributions to your FRS Investment Plan account from your own funds. The
amount contributed by your employer on your behalf is equal to a percentage of your gross
monthly salary, based on your employment class.
Employment Class Rate
Regular...................................................... ............................... 9.0%
SpecialRisk ................................................. ............................... 20.0%
Special Risk Administrative Support .................. ............................... 11.35%
Elected Officers
Legislators......................................... ............................... 13.40%
Governor, Lt. Governor, Cabinet Officers ........... ............................... 13.40%
State Attorney, Public Defenders ............ ............................... 13.40%
Justices, Judges .................................. ............................... 18.90%
County Elected Officers ......................... ............................... 16.20%
Senior Management Service ............................ ............................... 10.95%
The Internal Revenue Service imposes limits on the amount of your salary that may be considered
for contribution purposes, and the amount of contributions that may be made on your behalf.
Because these limits are high, very few participants will be affected. Your employer will be notified
if you approach these limits.
In addition to those contributions paid by your employer to fund your retirement benefit, your
employer contributes additional amounts to fund your Health Insurance Subsidy benefit (1.11 %),
disability benefits (will vary depending on employment class) and FRS Investment Plan
administration costs (.05 %).
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What investment options are available in the FRS Investment Plan?
The FRS Investment Plan offers a diversified mix of investment funds that span the risk - return
spectrum. On the FRS Internet site, MyFRS.com, you can review the Fund Profiles, Fund Details,
Fund Score Cards and the Investment Funds Summary by clicking on the T in the green tool bar
in the upper right section of the Home Page. These documents contain descriptions of the
available investment funds (including investment objective, fund management, investment risk and
fund expenses, etc.) to help you make informed investment decisions. You can also visit this site
to access the Financial Engines Personal Online Advisor® service, which can provide specific
investment guidance. If you do not have access to the Internet, you can call the MyFRS Financial
Guidance Line toll -free at 1- 866 -44 -MyFRS (1- 866 - 446 -9377; or TTY: 1- 888 - 429 -2160) and have a
professional financial planner explain the available options or walk you through the online services.
How can I change my investment options in the FRS Investment Plan?
You can generally change your investment mix at any time by telephone or online. Generally,
these changes can be made at no cost. However, some funds restrict your ability to move your
money under certain circumstances under an excessive fund trading policy (see below). If you do
not have access to the Internet website at MyFRS.com, you can call the MyFRS Financial
Guidance Line toll -free at 1- 866 -44 -MyFRS (1- 866 -446 -9377; or TTY: 1- 888 - 429 -2160) and
request help in making the changes, and to obtain a copy of the excessive fund trading policy.
Changes to the investment of your existing account balance will generally take effect at the close
of business on the day your request was made, provided that the request was completed by 4 p.m.
Eastern time. If your request is completed after 4 p.m. Eastern time or on a non - business day,
your change will generally take effect on the next business day that the financial markets are open.
Changes to the investment of future contributions to your account generally take effect with the
next monthly payroll.
What is the Excessive Fund Trading Policy?
The SBA has developed a policy to help protect all Investment Plan participants by preventing any
short -term excessive fund trading within the FRS Investment Plan. Excessive fund trading, in
which participants move money in and out of funds on a frequent basis to try to capture short-term
gains, can have a negative impact on the funds involved. It can drive up a fund's trading costs
which increase costs to all fund shareholders. It can also complicate a fund's portfolio management
and reduce the fund's investment returns.
Anyone with an account in the FRS Investment Plan is subject to the Policy, including current
employees, previous employees, former DROP participants with an Investment Plan account,
surviving beneficiaries and other alternate payees. The Policy applies to transfers of monies
between funds and does not affect any transaction that is initiated for purposes of depositing
employer payroll contributions or processing a distribution out of the plan. The latter two activities
are termed "exempt transactions."
Foreign and global investment funds are subject to a minimum holding period of 7- calendar
days following any non - exempt transfers into such funds. For example, if you transfer $5,000 into
one of the funds on November 4, you will not be able to transfer any amount out of that fund until
November 12, except for a distribution out of the plan.
All investment funds are subject to the following controls in order to mitigate excessive fund
trading:
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• Participants engaging in one or more Market Timing Trades in funds.will receive a warning
letter.
• Participants engaging in one or more Market Timing Trades within 30 days of the warning
letter will be sent a certified /return- receipt direction letter. The SBA may require non -
automated trade instructions for at least one full calendar month following the mailing of the
direction letter, including use of paper forms mailed certified /return- receipt to the third party
administrator. Automated trade instructions include the Internet and the interactive voice
response unit.
The following definitions apply:
Market Timing Trade - is a participant- directed series of trades that meet both of the following two
criteria:
• The series of transactions are Roundtrip Trades
• The series of transactions are, in aggregate, $75,000 or more (e.g., a purchase of fund
shares for $50,000 and a sale of $35,000 of the same fund's shares the next day would be
an aggregate trade amount of $85,000).
Roundtrip Trade — is one or more transfers into an investment fund and one or more transfers out
of the same investment fund in either order (i.e. in /out or out/in) within a 30 calendar day period,
regardless of any multiple transfers from or to other different investment funds during the Roundtrip
Trade.
You can get information on the specific funds subject to the foreign and global restrictions from the
Investment Fund Summary. You can get your questions answered by calling the toll -free MyFRS
Financial Guidance Line and connecting to a financial planner.
What is my creditable service?
A participant receives one month of service credit for each month in which any salary is paid for
work performed. Participants may not purchase credit (e.g., for past service, prior service, certain
military service, leaves -of- absence, etc.) to increase their FRS Investment Plan retirement benefit.
If an FRS covered employee has additional service credit he /she wishes to use towards his /her
retirement, he /she must purchase such service under the FRS Pension Plan before he /she
becomes a participant in the FRS Investment Plan.
What are the various types of employment status?
You are considered a rehired employee if: 1) you were formerly employed by an FRS
employer in a regularly established position that was covered for FRS purposes, 2) you
terminated employment without taking any distribution of benefits, and 3) you later returned
to FRS covered employment. Your FRS Investment Plan account balance must have
remained in the FRS Investment Plan.
If you return to FRS covered employment, you will return to the FRS Investment Plan,
unless you decide to use your one -time second election option (the Second Election; see
below) to change to the FRS Pension Plan.
You are considered a retired employee from the FRS Investment Plan if you terminate FRS
covered employment and take a distribution of any kind (lump sum, rollover, annuity, etc.).
If you return to FRS covered employment, you are considered a "reemployed retiree" or
"renewed member" and subject to the laws and rules governing such employees. These
laws and rules are enacted by the Florida legislature and implemented by the appropriate
agency. They are subject to change.
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As a reemployed retiree, you are considered a new employee and are entitled to choose
within 5 months following your month of hire which retirement plan you wish to participate
in: the FRS Pension Plan or the FRS Investment Plan. However, as a reemployed retiree,
you are not entitled to participate in the Special Risk Class, the FRS Pension Plan DROP
program, nor are you entitled to receive disability benefits from either plan. If these benefits
are important to you, you should consider not taking a distribution upon termination from
FRS covered employment, unless you are actually retiring and do not plan to return to FRS
employment in the future.
Can I return to employment after I retire?
Retirees may be reemployed by a private employer or by any non -FRS public employer without
affecting their retirement benefits. Retirees may not be reemployed with an FRS - participating
employer for the first 12 months after taking a distribution without suspending their retirement
benefits, except under limited circumstances as described below. An Investment Plan member is
considered retired once they terminate FRS - covered employment and take a distribution from their
account, so if an FRS Investment Plan member is reemployed with an FRS employer prior to
taking a distribution of his /her benefits, he or she will not be considered to have retired.
If an Investment Plan retiree has met the normal retirement requirements of the FRS Pension
Plan (i.e. age 62 and 6 years of service or 30 years of service or if Special Risk age 55 and 6
years of Special Risk service or 25 years of Special Risk service), they may return to work in
certain excepted positions as described below during and through the 12th month after
retirement without suspending benefits. Such retiree may return to this limited employment
after being off all FRS - covered payrolls for at least one calendar month.
If an Investment Plan retiree has not met the normal retirement requirements of the FRS
Pension Plan as described above, they may not return to FRS - covered employment in an
excepted position until they have been retired for three calendar months. After being retired for
three calendar months the retiree may return to employment in one of the excepted positions
during the remaining nine months after retirement without suspending their retirement benefits.
Exceptions to the Reemployment Law
If you retire from the Investment Plan and become reemployed in any of the following positions
during your first year of retirement, you may be exempt from the reemployment limitations, or you
may be otherwise eligible for a limited exception, as follows:
• A member who retires and is serving in an elective office or is elected, reelected, or
appointed to an elective office is exempt from reemployment limitations during the first year
of retirement.
• A retired justice or judge on temporary assignment to active judicial service pursuant to
Article V of the State Constitution is exempt from the reemployment limitations.
• Florida District Schools Boards - After meeting the above requirements, Investment Plan
retirees may be reemployed without limitation as classroom teachers on an annual
contractual basis. Additionally, noncontractual employment is allowed without further
limitation for Investment Plan retirees who are hired as education paraprofessionals,
transportation aides, bus drivers, or food service workers.
• Florida Schools for the Deaf and the Blind - Investment Plan retirees after meeting the
above requirements may be reemployed on an annual contractual basis as classroom
teachers or as substitute or hourly teachers on a noncontractual basis, without limitation.
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• Charter Schools — Investment Plan retirees after meeting the above requirements may be
reemployed as classroom teachers on an annual contractual basis or as substitute or hourly
teachers on a noncontractual basis, without limitation.
• Developmental Research Schools — Investment Plan retirees after meeting the above
requirements may be reemployed on an annual contractual basis as classroom teachers or
as substitute or hourly teachers on a noncontractual basis, without limitation.
• Community Colleges — Investment Plan retirees after meeting the above requirements may
be reemployed as part-time, noncontractual adjunct instructors or phased retirement
program participants for up to 780 hours during the first year of retirement as described
above.
• Universities — Investment Plan retirees after meeting the above requirements may be
reemployed as adjunct faculty or phased retirement program participants with the State
University System for up to 780 hours during the first year of retirement as described
above.
• Firefighters or Paramedics — Investment Plan retirees after meeting the above requirements
may be reemployed as firefighters or paramedics serving in temporary or regularly
established positions for up to 780 hours during the first year of retirement as described
above.
Any affected reemployed retiree who is not eligible for an exception or who exceeds his or her 780 -
hour limitation should notify the Investment Plan Administrator.
How can I make a beneficiary designation?
As a member of the FRS Investment Plan your spouse is automatically your primary beneficiary
unless you designate someone else after your most recent marriage. You may name as
beneficiary any person, organization, trust, or your estate. You may state that beneficiaries share
jointly or sequentially, or that any benefits due to your beneficiary be paid through a trust. If you do
not name a beneficiary or if your beneficiary has died, any benefits will be paid according to Florida
law (section 121.4501(20), Florida Statutes).
You may change your beneficiary at any time. If your designated beneficiary dies or your marital
status changes, it is important for you to submit a new beneficiary designation to be sure your
account is distributed as you wish in case of your death.
You may designate a beneficiary at the time of enrollment or later use a beneficiary designation
form (Form IPBEN -1) to name your beneficiaries. To obtain the form, you can call the MyFRS
Financial Guidance Line toll -free at 1- 866-44 -MyFRS (1- 866 - 446 -9377; or TTY: 1- 888 - 429 -2160)
and request that it be mailed to you. You can also find the form online at MyFRS.com.
Florida law requires that if you do not name your spouse as your primary beneficiary, he /she must
sign the beneficiary designation form. See Section 121.4501(2). Florida Statutes. The beneficiary
designation form (Form IPBEN -1) requires that your spouse sign acknowledging that he or she is
not named as your beneficiary.
What are my rights to a benefit?
If you are a participant in the FRS Investment Plan, you will be vested in employer contributions
and earnings on those contributions when you complete one year of service with a participating
FRS employer. If you terminate FRS - covered employment before completing one year of service,
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you will not be eligible to receive a benefit from the FRS Investment Plan. Instead, the balance in
your account will be placed in a suspense account for up to five years. If you return to FRS -
covered employment within this 5 -year period, the balance in the suspense account, plus accrued
earnings, will be returned to your account. If you do not return to FRS - covered employment within
the 5 -year period, you forfeit the balance.
If you have transferred a present value amount from the FRS Pension Plan to your FRS
Investment Plan account, you will vest in this transferred amount, plus interest and earnings
thereon, when you have completed six years of service. If you terminate employment with an FRS -
covered employer before completing six years of service, such transferred amount will be placed in
a suspense account for up to five years. If you return to FRS - covered employment as an eligible
employee within this 5 -year period, the amount placed in the suspense account, plus the accrued
earnings, will be returned to your account. If you do not return to FRS - covered employment as an
eligible employee within the 5 -year period, you will forfeit the amount(s) taken out of your account
and placed in suspense.
If you have transferred a present value amount from the FRS Pension Plan to your FRS
Investment Plan account and have at least one year of total service credit from the combined FRS
Pension Plan and FRS Investment Plan service, but less than 6 years of total service, you are
entitled to receive the FRS Investment Plan contributions and earnings in your account after your
termination of FRS - covered employment. However, if you take a distribution of your FRS
Investment Plan account balance you will forfeit the present value amount transferred from the
FRS Pension Plan. If you take a distribution of any amount from the FRS Investment Plan, you are
considered retired and will not be eligible for certain FRS benefits should you return to FRS -
covered employment in the future.
Additionally, if you have transferred a present value amount from the FRS Pension Plan to your
FRS Investment Plan account, the service may include the purchase of additional service under
the FRS Pension Plan (i.e. out -of- state - service) that does not count toward the FRS Pension Plan
6 -year vesting requirements. In this case you must complete a total of 6 years of FRS service to
be eligible for your Pension Plan transferred balance.
DISTRIBUTIONS FROM THE FRS INVESTMENT PLAN
How can I take distributions from the FRS Investment Plan?
Since the FRS Investment Plan is a retirement plan, you will not be permitted to make withdrawals
from the Plan while you are still employed by an FRS employer. After you have terminated all
FRS - covered employment for three calendar months, you can request a distribution of your
account. If you have reached the normal retirement requirements of the FRS Pension Plan for
your class of membership (i.e. age 62 with 6 years of service or 30 years of service for all classes
but Special Risk), you may take a distribution of up to 10% of your account balance after being
terminated for one calendar month.
If you leave FRS employment, you can leave your account invested in the FRS Investment Plan
until you decide to take a distribution from the Plan. Your benefit under the FRS Investment Plan
consists of the value of your account. If you are vested in your account, your benefit is payable to
you, or to your designated beneficiary or your estate upon your death. To begin receiving benefits,
you must be terminated from all employment with FRS - covered employers for three calendar
months, unless you meet the normal retirement requirements of the FRS Pension Plan, in which
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case you may receive up to 10% of your account balance after one calendar month and the
remainder after three months. However, if you start receiving distributions from your account
before you reach age 591/2, you may incur a 10% tax penalty imposed by the Internal Revenue
Service. There are exceptions to this penalty. Consult your tax advisor or call the MyFRS
Financial Guidance Line and speak to one of the financial planners before you make a decision
about taking a distribution.
You are not required to begin receiving your benefits at termination of employment but can defer
receiving them until a later date. In accordance with federal tax law, you must start receiving your
benefits no later than April 1 following the close of the later of the calendar year during which you
reach age 701/2 or terminate employment.
You may receive payment as:
• Partial or full lump -sum distribution;
• Partial or full lump -sum direct rollover distribution to an IRA or another employer's plan that
accepts rollover contributions. A rollover is a tax -free transfer from one eligible retirement
plan to another.
• A split distribution —part direct rollover and part payable to you
• Periodic distributions from your account balance.
Or you can use some or all of your account to buy monthly lifetime annuity payments guaranteed
by an insurance firm (currently The Hartford Life Insurance Company) contracted with the SBA.
Using this annuity option, you can provide for joint benefits or survivor benefits. These payments
may include survivor benefit options and a 3% annual benefit increase option similar to those found
in the FRS Pension Plan.
You must call the Investment Plan Administrator to request a distribution and to designate the type
of distribution you wish to take. In addition, you must call the Investment Plan Administrator to
request a roll over of your account balance to another eligible retirement plan. To get guidance to
properly carry out your wishes, contact the MyFRS Financial Guidance Line toll -free at 1- 866 -44-
MyFRS (1- 866 - 446 -9377; or: TTY 1- 888 - 429 - 2160). Before a distribution is made to you, further
information regarding plan distributions will be provided to you. Since tax consequences may be
severe if you make certain distribution choices, you may want to consult a professional tax adviser
before making your distribution election if you do not plan to call the Investment Plan Administrator.
If your account balance at termination is a de minimis amount as determined by the SBA, it could
be subject to an automatic distribution. Effective March 31, 2005, a de minimis amount has
been set for accounts with vested balances of $1,000 or less. No distribution will be made,
however, until you have been terminated from all employment with FRS - covered employers for at
least six calendar months. A de minimis distribution will be either a complete lump -sum liquidation
of your account, subject to the provisions of the Internal Revenue Code, or if you provide
affirmative instructions, a lump -sum direct rollover distribution paid directly to the custodian of an
eligible retirement plan on your behalf. If you return to FRS - covered employment after receiving a
de minimis distribution, you are not considered a reemployed retiree and will not be subject to the
limitations applicable to such employees.
Once you have taken a distribution from your Investment Plan account, the check for the amount of
the distribution is payable for 180 days. If the check is not cashed or deposited within 180 days it
becomes a stale -dated check and is canceled and placed in a suspense account. The Investment
Plan Administrator will endeavor to find the payee for up to 10 years using various methods. If the
payee is not found during the 10 -year period, the amount of the check is forfeited and used to pay
plan expenses of the Investment Plan. Once the check is distributed, no interest earnings will be
credited to the member or payee. All interest earnings on stale dated checks are deposited in the
Investment Plan and used to pay administrative expenses of the plan.
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What taxes are payable on distributions?
If you choose to receive payment of your distribution as a single lump sum, the taxable portion will
be subject to federal taxes in the year the distribution is made.
If you elect to roll over all or part of your distribution, the portion rolled over will not be taxed until
you take it out of the eligible plan. Any amounts eligible for rollover but paid directly to you will
have a mandatory 20 percent federal income tax withheld from the distribution (exceptions apply).
Any amount directly rolled over to another employer's plan or to an IRA will not be subject to the
mandatory 20 percent federal income tax withholding.
If you are under age 591/2 when you receive a distribution there will be an additional 10 percent
federal tax penalty on the taxable portion of your distribution. The 10 percent tax penalty may not
apply if you meet one of the exceptions permitted under the Internal Revenue Code such as death,
total and permanent disability, separation from service after age 55, or distribution according to a
Qualified Domestic Relations Order (QDRO). The penalty also does not apply to distributions
made as part of a series of substantially equal, periodic payments (at least annual) throughout your
life or life expectancy or the joint lives or joint life expectancies of you and your beneficiary if the
payment begins after your separation from service.
What charges are assessed on accounts in the FRS Investment Plan?
If you are an active employee of an FRS - covered employer, you will pay investment management
fees on your FRS Investment Plan account as imposed by the investment managers of the funds
you have chosen to invest in. Florida law also allows the imposition of fees for administration and
education services, but these are not presently charged to active - employee participants.
If you have terminated or retired from FRS employment (including former DROP participants who
have rolled funds into the Investment Plan) but have retained your account in the FRS Investment
Plan, you will continue to pay the investment management fees on your FRS Investment Plan
funds. Additionally, there is an administrative maintenance fee of $6 per quarter for all account
balances over $1,000. This amount will be automatically deducted from your account each
quarter.
If you are a divorced spouse of an FRS Investment Plan participant and you have your own
account because of a court- ordered qualified domestic relations order, you will pay the same
investment management fees (and any administrative fee) as terminated or retired participants.
Surviving beneficiaries are also subject to these fees.
Note that the procedures regarding determining whether a domestic relations order is a qualified
domestic relations order are available at no charge by calling the MyFRS Financial Guidance Line
at 1- 866 -44 -MyFRS (1- 866- 446 -9377; or TTY: 1- 888 - 429 - 2160).
Charges and fees assessed against Investment Plan accounts may change at any time without
prior notice to participants or FRS employers.
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THE SECOND ELECTION
FRS members have a one -time option, called "second election ", to change their retirement plan
while employed by an FRS - covered employer. This Second Election is codified in Section
121.4501(4)(e), Florida Statutes. It is available to new employees after their initial retirement plan
Enrollment Period ends or during the month of their retirement plan effective date if they make an
active election sooner.
If you were an existing employee during the initial implementation of the Investment Plan and
chose to remain in the FRS Pension Plan or if you are a newly hired employee who chose to
remain in the FRS Pension Plan, you have a one -time option to change to the FRS Investment
Plan.
If you elected to participate in the FRS Investment Plan during your initial retirement plan choice
period, you will have a one -time opportunity to change to the FRS Pension Plan at any point while
working for an FRS employer.
If you decide to change to the FRS Pension Plan, you must "buy back" into the FRS Pension Plan
with the money in your FRS Investment Plan account. If you don't have sufficient funds in your
FRS Investment Plan account, you can still get back into the FRS Pension Plan, but you must
make up the difference from your other financial resources. If you have a surplus remaining in
your FRS Investment Plan account after the "buy- back ", you will continue to have access to the
account to manage the assets. This account will be available for distribution once you retire and
begin receiving your FRS Pension Plan benefit.
If you are a State employee (including an employee of a State agency, State university, community
college, water management district, or blind vending operator) and were hired before April 1, 2002;
or you are a School District employee (district school board employee) and were hired before July
1, 2002; or you are a County & Other employee (an employee of a local government) or a
Reemployed Retiree with renewed FRS membership and were hired before October 1, 2002, and
you changed from the FRS Pension Plan to the FRS Investment Plan during your enrollment
period, you can switch back to the FRS Pension Plan by paying the buy -back amount. This amount
is calculated assuming that all of your FRS creditable service up to that point has been earned in
the FRS Pension Plan. If you elect this option and your FRS Investment Plan account balance is
greater than the required buy -back amount, you will keep the difference in your FRS Investment
Plan account. If your FRS Investment Plan account balance is less than the required buy -back
amount, you will have to make up the difference from your other financial resources.
If you joined the FRS Investment Plan as a new employee with no previous accumulated FRS
Pension Plan benefit and later wish to change to the FRS Pension Plan, you must pay the
Actuarial Accrued Liability (AAL) or total cost of the accumulated FRS Pension Plan benefit. If you
elect this option and your FRS Investment Plan account is greater than the required AAL, you will
retain the difference in your FRS Investment Plan account, but will be a member of the FRS
Pension Plan. If your FRS Investment Plan account is less than the required AAL, you must make
up the difference from your other financial resources.
If you join the FRS Pension Plan and wish to change to the FRS Investment Plan at a later date,
there will be no cost for the change. Your Accumulated Benefit Obligation (ABO) in the FRS
Pension Plan will be transferred to the Investment Plan as your opening account balance.
The Second Choice Service on MyFRS.com can help you estimate your buy -back amount. Or, you
can call the MyFRS Financial Guidance Line at 1- 866 -44 -MyFRS (1- 866- 446 -9377; or TTY: 1-888 -
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429 - 2160). The Division of Retirement will calculate the final buy -back amount you may owe. This
amount changes (i.e., typically increases) at the beginning of each month to reflect your new age
and service. Once you have the buy -back amount calculated by the Division of Retirement, you
must submit a 2nd Election Retirement Plan Enrollment Form to lock in the buy -back amount as of
the month calculated by the Division of Retirement. If you do not submit the 2nd Election
Retirement Plan Enrollment Form prior to the end of that month, a new buy -back amount must be
calculated by the Division of Retirement based on the new buy -back month. You may obtain the
form by calling the MyFRS Financial Guidance Line at 1- 866 -44 -MyFRS (1- 866 -446 -9377; or TTY:
1- 888 - 429 - 2160), or you can obtain the form online at MyFRS.com.
If you wish to use your Second Election, note that the plan change is effective the first day of the
month following the receipt and processing of your 2nd Election Retirement Plan Enrollment Form
by the FRS Plan Choice Administrator. Your 2nd Election Retirement Plan Enrollment Form must
be received by the Plan Choice Administrator, CitiStreet, prior to your termination. If received after
your termination it will be considered late and your plan change will be rejected. For example, if
you submit your 2nd Election Retirement Plan Enrollment Form in December and it is received and
processed by the Plan Choice Administrator on December 15, your plan change will be effective on
January 1. You may terminate employment any time after December 15. However, if you
terminate employment on December 5 prior to the receipt and processing of the Enrollment Form,
it will be rejected or reversed and you will remain in your original retirement plan.
NOTE: Lump sum leave payments made after you terminate your employment do not meet
the employment requirements. For example, if your plan change will be effective January
1, you cannot terminate employment December 20, and utilize lump sum leave payments
made to you in December or January to meet the requirements described above.
BENEFITS
Disability benefits
To qualify for disability retirement benefits, you must be totally and permanently disabled, and your
injury or illness must have occurred before you terminated employment. If you are a retiree with
renewed membership in the FRS Investment Plan, you are not eligible for disability benefits.
As a member of the FRS Investment Plan, if you become disabled and are approved by the
Division of Retirement to receive benefits from the FRS, your FRS Investment Plan account
balance will be transferred to the FRS Pension Plan Trust Fund and you will receive disability
benefits under the provisions of the FRS Pension Plan. You are not required to use your one -time
Second Election to change to the FRS Pension Plan. Disability benefits are not reduced for early
retirement. If you recover from your disability, you will be transferred back to the FRS Investment
Plan along with any remaining account balance, plus earnings you have not drawn in retirement
benefits. If you should die, your beneficiary may receive a continuing monthly benefit if you
selected a retirement option which provides this.
As an alternative to receiving disability benefits from the FRS Pension Plan, you may elect to
continue your participation in the FRS Investment Plan and take a distribution of your account
balance under any of the methods provided in the Plan.
Two types of disability benefits are payable under the FRS:
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• Regular Disability Benefits - To qualify for regular disability retirement, you must complete
at least 8 years of creditable service. If approved by the Division of Retirement, your option
1 annual benefit will be at least 25 percent of your average final compensation. If your
actual earned benefit, based on your years of service, would be higher than the 25 percent
minimum disability benefit, the higher amount will be paid.
• In- Line -of -Duty Disability Benefits- You are covered for in- line -of -duty disability beginning
on your first day of covered FRS employment. Your in- line -of -duty disability must be
caused by injury or illness that happens in the actual performance of duties as required by
your job. The minimum yearly benefit paid under option 1 for this type of disability is 42
percent (65 percent for Special Risk) of your average final compensation. If your actual
earned benefit, based on your years of service, would be higher than the 42 percent (65
percent for Special Risk), the higher benefit amount will be paid.
Certain FRS members may be entitled to a presumption that they were disabled in the line of duty:
• Firefighters, law enforcement officers and correctional officers disabled due to heart
disease, hypertension or tuberculosis.
• Firefighters, paramedics, emergency medical technicians, law enforcement officers and
correctional officers disabled due to hepatitis, meningococcal meningitis, or tuberculosis.
Death benefits
If you die, the value of your account will be distributed to your named beneficiary or to your estate
minus any required withholding tax remitted to the Internal Revenue Service. Your beneficiary may
receive an immediate distribution under the same options as provided for participants, or defer
receipt until some future date. If deferring, the beneficiary should call the MyFRS Financial
Guidance Line to determine the limits of the deferral. In some instances, beneficiaries must decide
within one year how they want the account balance distributed.
Health Insurance Subsidy (HIS)
HIS is only available after attaining six years of service. To be eligible to receive the HIS under the
FRS Investment Plan, you must meet the normal retirement age or service requirements of the
FRS Pension Plan for your class of membership and provide proper documentation certifying that
you have health insurance coverage. For example, a Regular Class member must be either age
62 and have 6 years of service or have a total of 30 years of service, and a Special Risk member
must be either age 55 with 6 years or have a total of 25 years of service.
If you leave FRS - covered employment and take a benefit distribution prior to meeting the normal
retirement requirements, you must wait until you reach normal retirement age to begin receiving
your HIS benefit. If you elect the FRS Investment Plan Hybrid Option, you will receive your HIS
payment once you begin receiving your FRS Pension Plan benefit.
The HIS subsidy, which is paid monthly, is $5 for each year of creditable service, with a minimum
HIS of $30 per month and a maximum HIS of $150 per month.
If you die, your spouse, if any, at the time of death will be entitled to receive your HIS benefit. It is
not available to any other beneficiary.
These requirements and amounts are enacted by the Florida Legislature and are subject to
change.
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Do I forfeit my retirement benefits if I commit a crime?
If, prior to retirement, you commit a crime specified by Florida Statutes as requiring forfeiture of
benefits and are found guilty, or enter a plea of guilty or polo contendere, or your employment was
terminated because of an admission to committing, aiding, or abetting a specified crime, retirement
rights and benefits are forfeited (except for any portion of your Investment Plan account attributable
to a refund of personal retirement contributions or deposits, if any were made to the plan when
they were previously allowed). The forfeiture of benefits provision applies if a job - related felony
offense as outlined below is committed:
• Committing, aiding or abetting an embezzlement of public funds or any grand theft from the
employer;
• Committing bribery in connection with employment;
• Committing any other felony specified in chapter 838, F.S., (bribery and misuse of public
office), except ss. 838.15 and 838.16, F.S., (commercial bribes);
• Committing any felony with intent to defraud the public or the employer of the right to
receive the faithful performance of duty, or receiving or attempting to receive profit or
advantage for the participant or another person through the use of his or her position; or
• Committing an impeachable offense (applies to elected officials only).
See s. 112.3173, F.S., and s. 8, Article II of the Florida Constitution for additional information. In
addition to the crimes stated above, if a court of competent jurisdiction finds that you violated any
state law against strikes by public employees, your benefits are forfeited.
If your beneficiary is found to have intentionally killed you or procured your death, he or she forfeits
all rights to retirement benefits. Any benefits payable would be paid as if the beneficiary died
before the participant.
The Clerk of the Court, the Secretary of the Senate or the employer, as appropriate, must notify the
Commission on Ethics if you are found guilty of (or otherwise responsible for), impeached, or
terminated prior to retirement due to any of the above offenses. The Commission on Ethics will
notify the Division of Retirement. Your benefits will be suspended subject to a hearing held by an
administrative law judge of the Division of Administrative Hearings. The judge's decision may be
appealed to the applicable District Court of Appeal.
COMPLAINT PROCEDURES
Section 121.4501(9)(f)3., Florida Statutes, requires the SBA to establish "procedures to receive
and resolve participant complaints against a provider or approved provider personnel, and, when
appropriate, refer such complaints to the appropriate agency."
If you have a complaint against a provider such as an administrative, education or investment
provider, the complaint procedures establish a sequence of events, which must be followed to
allow for a proper understanding of the complaint and to allow for a complete investigation of the
complaint. The complaint procedures also include the opportunity for a hearing pursuant to
Chapter 120, Florida Statutes, which is Florida's Administrative Procedure Act. Further, the
complaint procedures state the opportunity to appeal the outcome of the hearing.
These complaint procedures must also be used if the SBA or another entity makes a decision,
which will reduce, suspend, or terminate your retirement benefits.
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These procedures are available at no charge as a separate document. To get a copy, please call
the FRS Investment Plan Administrator, toll -free, at 1- 866- 44MyFRS (1- 866 -446 -9377; or TTY: 1-
888- 429 -2160. The procedures are also available online at MyFRS.com.
OTHER FRS INVESTMENT PLAN INFORMATION
Situations which may affect your FRS Investment Plan benefits
The FRS Investment Plan is designed to provide you with income for your retirement. However,
some situations could affect your benefits:
If you terminated employment before becoming vested in the FRS Investment Plan, you will
not receive any benefits from the plan. If you transferred your accumulated benefit
obligation from the FRS Pension Plan into the FRS Investment Plan, but you terminated
employment before attaining the required six years to vest in the FRS Pension Plan portion
of your account in the FRS Investment Plan, you will not be able to obtain a distribution of
your FRS Pension Plan benefits. However, you will be able to obtain your contributions and
earnings on employer contributions made on your behalf if you have become vested in the
FRS Investment Plan by working for one year. If you take a distribution of your FRS
Investment Plan account, you will forfeit the non - vested amount you transferred from the
FRS Pension Plan, plus earnings on that amount.
• If you do not apply for payments from the FRS Investment Plan before stated deadlines, or
if you do not provide the information requested by the FRS Investment Plan Administrator
(the SBA or one of its contracted partners), your payments may be delayed; or
If your mailing address on file with the FRS Investment Plan Administrator is incorrect,
payments from the FRS Investment Plan may be delayed. Additionally, you may not
receive statements of your FRS Investment Plan account balance or other important
notices.
What is the process for amendments to the plan or for termination of the plan?
The 2000 Session of the Florida Legislature established the FRS Investment Plan with the intent to
continue the Plan indefinitely.
However, because future circumstances cannot be anticipated, the Florida Legislature may change
all or any part of the FRS Investment Plan. Changes to the FRS Investment Plan may or may not
apply to you.
If the FRS Investment Plan should ever be terminated, you would become 100% vested in your
employer contributions, including any attributable earnings, and be entitled to the full value of your
FRS Investment Plan account as of the Plan's termination date.
If the Florida Legislature makes any significant legislative changes to the FRS Investment Plan,
this document will be updated. However, the SBA has no obligation to update this document
before changes in statute or rule are effective, or notify you personally of any changes to statute,
rules or this document.
The MyFRS Financial Guidance Program — Use It No Matter Which Plan You Choose
Phone: MyFRS Financial Guidance Line: 1- 866 -44 -MyFRS (1- 866 - 446 -9377, or TTY: 1- 888 - 429 -2160)
Online: MyFRS.com • Retirement and Financial Planning Workshops offered in some locations
20
What is the policy regarding errors and incorrect or incomplete data?
Errors may sometimes occur in determining benefits provided by the FRS Investment Plan. This
could be due to incorrect or incomplete data or to other reasons. If such an error is discovered, the
FRS Investment Plan Administrator and your employer reserve the right to correct it. If you receive
an overpayment as a result of an error, you will be notified of the amount and will be required to
repay it either to the FRS or your employer, as applicable. If you have an underpayment you will
receive an additional payment from the FRS Investment Plan Administrator.
What are my rights regarding employment in the FRS Investment Plan?
Participation in the FRS Investment Plan, or any contributions to the FRS Investment Plan on your
behalf, or any other part of FRS Investment Plan operation or administration does not give you the
right to continued employment with any FRS employer.
What are my rights to assign benefits?
The benefits payable to you under the FRS Investment Plan, and any contributions accumulated
under the Plan, are not subject to assignment, execution, attachment, or any legal process, except
for a Qualified Domestic Relations order ( "QDRO ") issued by a court of competent jurisdiction,
income deduction orders as provided in s. 61.1301, Florida Statutes, and federal income tax levies.
If you divorce or legally separate, the FRS Investment Plan may be required to follow the
provisions of a QDRO that assigns part or all of your FRS Investment Plan account to a former
spouse or for the support of your dependents.
The Division of Retirement within the Department of Management Services determines whether a
court order is a QDRO. You can obtain QDRO information from the Division of Retirement by
calling the Legal Office at 850 - 414 -7602 or the Bureau of Retirement Calculations at 850 -414-
7007, or toll -free at 1- 866 - 446 -9377, option 3.
The Division of Retirement will send you a notice if the Plan receives a court order that could affect
your FRS Investment Plan account.
RETIREMENT PLAN ROLL OVERS TO THE INVESTMENT PLAN
Members of the FRS Investment Plan are permitted to roll over eligible retirement monies from
other qualified retirement plans (i.e., 401(k), IRA, 403(b) plans, etc.). After -tax monies rolled over
from an eligible plan should be indicated on your distribution statement from the previous plan.
The distribution statement should include the distribution date and the eligible rollover amount,
including a separate accounting of any after -tax monies included in the rollover amount. If you are
uncertain as to whether your former retirement plan is eligible to be rolled over, call the MyFRS
Financial Guidance Line at 1- 866 - 446 -9377, Option 4 and one of the customer service
representatives will help you make the determination.
Effective July 1, 2005, current and former DROP participants of the FRS Pension Plan may roll
over their DROP accumulation into the FRS Investment Plan as one of the allowed vehicles for
distribution. This option allows these FRS members to keep some or all of their DROP account
balance in the FRS and take advantage of the investment products and distribution options of the
Investment Plan. DROP participants who use this option are subject to the benefits and provisions
The MyFRS Financial Guidance Program — Use It No Matter Which Plan You Choose
Phone: MyFRS Financial Guidance Line: 1- 866 -44 -MyFRS (1- 866 - 446 -9377; or TTY: 1- 888 - 429 -2160)
Online: MyFRS.com • Retirement and Financial Planning Workshops offered in some locations
21
of the Investment Plan as outlined in this summary plan description. If a terminated DROP
participant rolls his /her DROP accumulation into the Investment Plan and then returns to work with
an FRS employer, the participant retains access to his /her DROP proceeds for distribution
purposes.
WHERE SHOULD I GO FOR MORE INFORMATION?
• FRS Internet Site: MyFRS.com web site will be your online source of information for managing
your FRS Investment Plan account.
MyFRS Financial Guidance Line: 1- 866- 44MyFRS (1- 866 - 446 -9377; or TTY: 1- 888 -429 -2160)
• Toll -free
• Available 9 a.m. to 8 p.m. Eastern time /8 a.m. to 7 p.m. Central time Monday
through Friday, except holidays
By calling this number, you can contact the following:
(1) an experienced, objective financial planner;
(2) the Division of Retirement — the administrator of the FRS Pension Plan — which can
answer detailed questions about the FRS Pension Plan, second election buy back costs
and QDRO's. The Division's hours are 8:00 a.m. to 5:00 p.m. Eastern time, Monday
through Friday, except holidays;
(3) CitiStreet, administrator of the FRS Investment Plan. You can call CitiStreet to request
account statements and fund performance reports; move money between investment
options within your account; and arrange for benefit payments; file your Second Election
Form, and to request forms and brochures.
In the month following quarter end, you will receive a personalized statement showing the status of
your FRS Investment Plan account as of that quarter end.
WHAT IS THE FINANCIAL GUIDANCE AND ADVICE POLICY?
When you use either the online CHOICE SERVICE or the ADVISOR® SERVICE from Financial
Engines you will have the opportunity to review recommendations for the allocation of investment
funds. Financial Engines is authorized to provide these Services to Florida Retirement System
members under contract with the State Board of Administration of Florida (SBA). Financial Engines
will discharge each of its duties under the SBA contract and exercise each of its powers with due
care, skill, prudence and diligence under the circumstances that a prudent expert, acting in a like
capacity and familiar with such matters, would use in the conduct of any enterprise of like character
and with like aims. Financial Engines discharges its duties under the SBA contract solely in the
interest of FRS participants and their beneficiaries, shall not directly or indirectly receive any
benefit from recommendations made under the SBA contract, and shall disclose to the SBA any
investment or economic interest of Financial Engines that may be enhanced by the
recommendations it makes under the SBA contract. With respect to investment advisory services
provided to you by Financial Engines, Financial Engines will also be bound by fiduciary duties
imposed by federal and state securities laws.
The MyFRS Financial Guidance Program — Use It No Matter Which Plan You Choose
Phone: MyFRS Financial Guidance Line: 1- 866 -44 -MyFRS (1- 866 -446 -9377; or TTY: 1- 888 - 429 -2160)
Online: MyFRS.com • Retirement and Financial Planning Workshops offered in some locations
22
It is important for you to understand that the SERVICES are frameworks to be used in your own
retirement planning; they are not a substitute for your own informed judgment or decisions.
Moreover, they provide only some of the resources that could possibly assist you in making your
decisions and may not reflect all of your individual needs and circumstances. You may accept,
reject or modify the recommendations provided by the CHOICE and ADVISOR SERVICES, and
you may consult with other advisors or professionals (at your expense) as you see fit regarding
your personal circumstances.
In particular, before applying any asset allocation presented to you in the SERVICES, you should
consider your other assets, income and investments (including, for example, equity in a home,
IRA investments, savings accounts and interest in other retirement plans) as well as your FRS
investments and benefits. As provided in Rule section 19- 13.004(4)(d), Florida Administrative
Code, the use of the terms "recommended" or "advice ", or forms thereof of these terms, do not
constitute the rendering of advice in the absence of a mutual agreement between the member and
the plan that the advice will serve as a primary basis for the member's investment decisions with
respect to the member's account assets. Such mutual agreement is not offered under the FRS.
The MyFRS Financial Guidance Program — Use It No Matter Which Plan You Choose
Phone: MyFRS Financial Guidance Line: 1- 866 -44 -MyFRS (1- 866 - 446 -9377; or TTY: 1- 888 - 429 -2160)
Online: MyFRS.com • Retirement and Financial Planning Workshops offered in some locations
23
GLOSSARY
The following terms are defined as used in connection with the FRS and in this brochure. In an
effort to make these provisions easy to understand, nontechnical language has been used as
much as possible. Questions of interpretation will be governed by chapter 121, Florida Statutes,
and any applicable rules of the Florida Administrative Code.
Beneficiary: The joint annuitant or any other person, organization, estate, or trust fund you
designate to receive a retirement benefit that may be payable when you die.
Benefit: Any payment —lump sum or periodic —to you, a retiree, or a beneficiary, based partially
or entirely on employer contributions.
Contributions: The percentage of your gross monthly salary that your employer contributes to the
FRS Investment Plan on your behalf.
Creditable service: A participant receives one month of service credit for each month in which
any salary is paid for work performed.
Date of participation: The date you become a plan participant.
Defined contribution plan: A type of retirement plan as defined under section 401(a) of the
Internal Revenue Code, which defines the amount of employer contributions which are made for an
employee and that amount is generally related to an employee's salary.
Division: Division of Retirement within the Florida Department of Management Services
Eligible employee: An officer or employee who is a participant of or is eligible for participation in
the Florida Retirement System, participates in or is eligible to participate in the Senior Management
Service Optional Annuity Program, or is eligible to participate in (but does not participate in) the
State University System Optional Retirement Program. An eligible employee does not include
Deferred Retirement Option Program (DROP) participants.
Eligible rollovers: A direct plan transfer from an eligible retirement plan to the FRS Investment
Plan. Terminated FRS DROP participants can roll over their DROP proceeds into the FRS
Investment Plan. All rollovers can be accessed for distribution by the participant even if the
participant has returned to FRS - covered employment.
Employer: Any agency, branch, department, institution, university, institution of higher education,
or board of the state, or any county agency, branch, department, district school board, or special
district of the state, or any city of the state that participates in the Florida Retirement System for the
benefit of certain of its employees, or a charter school or charter technical career center that
participates as provided in s. 121.051(2)(d), F.S.
Fiscal Year: A 12 -month period beginning July 1 and ending on June 30
Health Insurance Subsidy, or HIS: A supplementary benefit paid to you after you have
terminated employment and have reached either the normal retirement age or normal retirement
date of the Pension Plan, to help you pay the cost of your health insurance premiums. The HIS
amount you receive is based on your length of service. The subsidy is $5 for each year of
creditable service (with a minimum HIS of $30 per month and a maximum HIS of $150 per month).
The MyFRS Financial Guidance Program — Use It No Matter Which Plan You Choose
Phone: MyFRS Financial Guidance Line: 1- 866 -44 -MyFRS (1- 866- 446 -9377; or TTY.- 1- 888 - 429 -2160)
Online: MyFRS.com • Retirement and Financial Planning Workshops offered in some locations
24
You must apply for the HIS with the Division of Retirement. If you die, your spouse at the time of
death is entitled to the HIS benefit.
Local agency employer: The board of county commissioners or other legislative governing body
of a county, including that of a consolidated or metropolitan government; a clerk of the circuit court,
sheriff, property appraiser, tax collector, or supervisor of elections, provided such officer is elected
or has been appointed to fill a vacancy in an elective office; a community college board of trustees
or district school board; or the governing body of any city or special district of the state which
participates in the system for the benefit of certain of its employees.
Plan year: The period of time beginning July 1 and ending on the following June 30, both dates
inclusive, for all State - administered retirement systems.
Public Employee Optional Retirement Program ( PEORP): Formal name of the FRS Investment
Plan. Available beginning in 2002, the PEORP is a optional defined contribution plan alternative to
the FRS Pension Plan. If you were actively employed when the PEORP became effective, you
had a 90 -day education period followed by a 90 -day period in which to choose participation in
PEORP. If you are first employed on, or you return to covered employment after, the applicable
June 1, September 1, or December 1, 2002 election dates, you have a 6 -month period to elect
participation in the PEORP. If you don't make a selection, you will remain in the defined benefit
plan (FRS Pension Plan). Participants of the State University System Optional Retirement
Program, and participants in the Teachers Retirement System or State and County Officers and
Employees Retirement System are not eligible to participate in PEORP.
Reemployment: This term means employment after retirement and is generally limited to
employment with employers participating in the FRS. However, if you are a disability retiree,
reemployment occurs whenever you are gainfully employed by any employer, public or private.
Salary: Regular payment of compensation by an FRS employer to an employee for work
performed, including certain overtime payments. Bonus payments are not considered
compensation. (By law, certain fees and other amounts are not considered "compensation" under
the FRS. See s. 121.021(22), F.S., or see subsection (16) of rule 60S- 6.001, F.A.C., for details.)
Retiree: Under the FRS Investment Plan, this term means a former participant of the FRS
Investment Plan who has terminated employment and has taken a distribution of benefits from the
plan, except for a mandatory distribution of a de minimis account balance.
Retirement: Under the FRS Investment Plan, this term means the point at which you are vested,
have terminated all FRS - covered employment, and have taken a distribution from the Plan.
Special district: An independent special district as defined in s. 189.403(3), F.S.
State agency: Any agency, branch, department, institution, university, institution of higher
education, or board of the state that participates in the Florida Retirement System.
State board, or board, or the SBA: The State Board of Administration of Florida.
Termination: This refers to the termination of employment, which occurs when you end all
employment with all FRS employers for at least 1 calendar month. FRS Investment Plan members
will cancel their retirement if they are reemployed by any FRS employer during the first three
calendar months (one calendar month if they have met the normal retirement requirements of the
FRS Pension Plan) after termination of employment prior to taking a distribution from their
Investment Plan account balance (except that they may retire on disability while on a leave of
The MyFRS Financial Guidance Program — Use It No Matter Which Plan You Choose
Phone: MyFRS Financial Guidance Line: 1- 866 -44 -MyFRS (1- 866- 446 -9377; or TTY: 1- 888 - 429 -2160) -
Online: MyFRS.com • Retirement and Financial Planning Workshops offered in some locations
25
absence for medical reasons). Disability retirees will cancel their retirement if any employer
gainfully reemploys them at any time following their termination date.
Vest, Vested or Vesting: These terms refer to the guarantee of a benefit under the FRS
Investment Plan after you work one year for an FRS employer and earn creditable service in a
regularly established position with an FRS employer participating in the FRS Investment Plan. You
will be vested in the FRS Investment Plan after you complete one year of service.
Year of service or work year: The period of time you are required to work to receive a full year of
creditable service.
The MyFRS Financial Guidance Program — Use It No Matter Which Plan You Choose
Phone: MyFRS Financial Guidance Line: 1- 866 -44 -MyFRS (1- 866 - 446 -9377; or TTY: 1- 888 -429 -2160)
Online: MyFRS.com • Retirement and Financial Planning Workshops offered in some locations
26
�.'I
i
FRSTODAY
FLORIDA RETIREMENT SYSTEM
A RETIREMENT GUIDE FOR THE
FRS PENSION PLAN . 2004 EDITION
DEPARTMENT OF MANAGEMENT SERVICES
DIVISION OF RETIREMENT
DISCLAIMER
As much as possible, this brochure has been written in non -
technical terms, avoiding the formal language of the retirement
laws and rules. If questions of interpretation arise as a result of the
attempt to make the retirement provisions easy to understand, chap-
ter 121, Florida Statutes, and chapter 60S, Florida Administrative
Code, must remain the final authority.
The information provided in this brochure is based on the Florida
Retirement System Pension Plan laws and rules in existence as of
July 2004, and is subject to modification based on changes in the
law or the Florida Administrative Code.
Representatives from participating agencies are not agents of the
Department of Management Services (Department) or the Division
of Retirement (Division). The Department and Division are not
responsible for erroneous information provided by representatives
of participating agencies.
' Defined terms are underlined the first time they appear in this publication. All
underlined terms (and others) are defined in the glossary on page 74.
A Retirement Guide
for Members of the
Regular Class
of the
Florida Retirement System
Pension Plan
2004 Edition
Department of Management Services
Division of Retirement
MyFlonda.com
DWISION OF RrrmzmEN]T
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DEPARTMENT OF MANAGEMENT
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SERVICES
rv.eMYFWd. Wf.
)EB BUSH, CiOV WA TOM[ IL.bRB y
Dear Florida Retirement System Pension Plan Member:
The 2004 edition of the Retirement Guide for Members of the
Regular Class has been prepared to tell you about your
retirement system — its benefits and policies — and your rights
as a member. Membership in the Florida Retirement System
(FRS) is an important benefit your employer provides at no
cost to you.
This guide is the basic employee handbook about the FRS
Pension Plan and is intended to be a reference for you. It is
supplemented by information posted on the FRS websites
(www.myflorida.com /frs or www.myfrs.com) and by newsletters
and other publications available to you before and after retire-
ment. A list of informational publications you may request or
access from either website is on page 84. [If you are an FRS
Investment Plan member, please call the MyFRS Financial
Guidance line toll free at 1- 866 -44 -MyFRS (1 -866- 446 -9377)
for answers to any questions regarding your benefits.]
In an effort to fulfill the Department's mission "to better serve
the people of Florida," we have included a critique of this
guide on page iv. Please complete and return this critique so
that we may serve you better. Should you have specific
questions or need additional information, the Division of
Retirement's address and phone numbers are on page 1. If
you plan to visit, a map showing the location is on page 3.
Sincerely,
Sarabeth Snuggs
State Retirement Director
z3
Regded Paper
111
BROCHURE CRITIQUE
Retirement Guide for Members of the Regular Class
— 2004 Edition
Please rate the following aspects of this brochure:
1. Explanation of provisions of the Florida Retirement System.
❑ ❑ ❑ ❑ ❑
Excellent Above Average Below Poor
Average Average
2. Readability (easy to read).
❑ ❑ ❑ ❑ ❑
Excellent Above Average Below Poor
Average Average
3. Useful for future reference. ❑Yes ❑ No
4. I found the following section(s) or subject(s) helpful:
5. I found the following section(s) or subject(s) confusing:
6. Questions or comments:
Please mail your completed critique to the Division of Retirement at the
address shown on page 1. If you need an answer to a question, be sure
to include your full name, Social Security number, daytime telephone
number, and return address. Thank you for your time and consideration
in completing and returning this evaluation.
tv
[TA
TABLE OF CONTENTS
Letterto Members ......................... ............................... ............................
iii
Brochure Critique ...................................................... ...............................
iv
Contacting the Division ............................................... ..............................1
Mapto Division ..................................................... ..............................3
Plan Information .......................................................... ..............................4
Membership.................................................................. ..............................5
Dual Membership Not Allowed ........................... ..............................5
Classes of Membership ......................................... ..............................6
Optional Retirement Programs ............................ ..............................7
Social Security Coverage ....................................... ..............................9
Portability............................................................... ..............................9
Contributions............................................................... .............................10
Refund of Contributions ...................................... .............................11
Beneficiary Designation .............................................. .............................12
Before You Retire .................................................. .............................12
WhenYou Retire ................................................... .............................13
AfterYou Retire .................................................... .............................14
Vesting.......................................................................... .............................15
TerminatingEmployment ........................................... .............................16
Before You Are Vested., .....................................................................
16
AfterYou Are Vested ............................................ .............................17
Your Retirement Benefit .............................................. .............................18
Retirement Benefit Formula ................................. .............................18
Years of Creditable Service ........................... .............................18
Average Final Compensation ........................ .............................18
Percentage Value ............................................ .............................18
Percentage Value for a Year of Retirement Credit ..........................19
Steps to Calculate a Benefit for a Vested Member ..........................21
InformationRequests .................................................. .............................24
Online Information & Estimates ......................... .............................24
Official Estimate Requests ................................... .............................25
OtherEstimates .................................................... .............................26
CreditableService ....................................................... .............................27
Counting Your Years of Creditable Service ........ .............................27
Other Types of Creditable Service ...................... .............................28
[TA
Deferred Retirement Option Program ....................... .............................37
Retiring from the Pension Plan ..................................
.............................43
Estimateof Benefits ..............................................
.............................43
NormalRetirement ...............................................
.............................44
EarlyRetirement ...................................................
.............................44
Dual Retirement Ages ..........................................
.............................45
Termination...........................................................
.............................45
Effective Retirement Date ....................................
.............................46
Application for Benefits .......................................
.............................46
Benefit Payment Options .....................................
.............................47
Proofof Age ..........................................................
.............................50
Limitationof Benefits ...........................................
.............................51
DisabilityBenefits .......................................................
.............................53
Regular Disability Benefits ..................................
.............................53
In- Line -of -Duty Disability Benefits .....................
.............................53
SurvivorBenefits .........................................................
.............................54
Regular Survivor Benefits ....................................
.............................54
In- Line -of -Duty Survivor Benefits ......................
.............................56
AfterRetirement ..........................................................
.............................57
Cost -of- Living Increase ........................................
.............................57
Health Insurance Subsidy ( HIS) ..........................
.............................57
Insurance Coverage after Retirement .................
.............................58
Reemployment after Retirement .........................
.............................58
Exceptions to the Reemployment Law ........
.............................59
Reemployment of Disabled Members ..........
.............................61
Renewing Membership after Retirement
..... .............................62
Minimum Benefit Adjustment .............................
.............................62
GeneralInformation ....................................................
.............................63
AppealsProcedure ...............................................
.............................63
Forfeiture of Benefits ............................................
.............................63
Assignment, Execution, or Attachment ..............
.............................64
Financial and Actuarial Information .........................
.............................65
LegislativeUpdate ......................................................
.............................68
Glossary of Retirement Terms ....................................
.............................74
Abbreviations.............................................................
.............................83
Publications.................................................................
.............................84
vi
CONTACTING THE DIVISION
When you contact the Division, please include your full
name, your Social Security number, return address, and
daytime telephone number. The Division's Internet website ad-
dress is: www.myflorida.com /frs . It is available to you 24 hours a
day, 7 days a week, and provides you with immediate access to
most of our publications and forms and frequently asked ques-
tions. Through the secure web environment of Online Services,
you may calculate your own informal benefit estimate or request
that the Division calculate one for you. If you prefer to write to us,
address your correspondence to:
DIVISION OF RETIREMENT
PO BOX 9000
TALLAHASSEE FL 32315 -9000
When you telephone, fax or e-mail the Division, the following
descriptions will help you find the right office. If you use SUNCOM
when telephoning the Division, omit the area code and replace the
prefix 488 with 278; 487 with 277; 410 with 210; and 921 with 291.
Bureau or Section
• Bureau of Retirement Calculations - Determining eligibility for
service retirement and the Deferred Retirement Option Program (DROP),
calculating retirement benefits and estimates of benefits, calculating the
cost to purchase various types of creditable service, and answering ques-
tions about reemployment after retirement.
Telephone number ..................................... ............................... 850/488 -6491
Faxnumber ................................................ ............................... 850/410 -2195
E- mail ................................. ............................... calculations@frs.state.fl.us
• Bureau of Benefit Payments -
Retired Payroll Section - Issuing benefit payments and employee contri-
bution refunds, handling retiree/ payee address changes, and processing
insurance and tax deductions.
Telephone number ..................................... ............................... 850/488 -4742
Fax number ................................................. ............................... 850/410 -2193
E -mail .......................................... ............................... retired@frs.state.fl.us
DROP Termination Unit - Reporting termination of employment by
DROP participants, processing DROP payout forms.
Telephone number ..................................... ............................... 850/487 -4856
Fax number ................................................. ............................... 850/410 -2199
E- mail .................................... ............................... drop_term@frs. state. fl. us
Disability Determination Section - Answering questions about
eligibility for disability benefits and processing disability retirement
applications.
Telephone number ..................................... ............................... 850/488 -2968
Faxnumber ................................................. ............................... 850/410 -2198
E- mail ...................................... ............................... disability@frs.state.fl.us
Survivor Benefits Section - Processing claims for survivors and bene-
ficiaries upon a member's death and processing beneficiary changes
after retirement or after the end of DROP participation.
Telephone number ..................................... ............................... 850/488 -5207
Fax number ................................................. ............................... 850/410 -2197
E- mail ........................................ ............................... survivor@frs.state.fl.us
• Research & Education Section - Analyzing proposed legislation,
researching retirement - related issues, coordinating policy development,
and producing and distributing publications.
Telephone number ..................................... ............................... 850/488 -5706
Fax number ................................................. ............................... 850/921 -0371
E- mail ................................................ ............................... rep@frs.state.ft.us
• Bureau of Enrollment & Contributions - Enrolling agencies and
members in the Florida Retirement System, State University System
Optional Retirement Program, Senior Management Service Optional
Annuity Program, and Social Security, and processing beneficiary
changes before retirement.
Telephone number ..................................... ............................... 850/488 -8837
Fax Number ................................................ ............................... 850/488 -5290
E- mail .................................. ............................... enrollment@frs.state.fl.us
You may also reach some areas of the Division via the toll -free
MyFRS Financial Guidance Line at 866/446 -9377, option 3. Or, if you
have a hearing or speech impairment, you may call the Division via
T.D.D. at the Florida Relay System by dialing 711 or 800/877 -1113.
2
Map to Division
You may visit the Division at the address below without an
appointment from 8:00 a.m. until 4:30 p.m., Monday through
Friday, except on designated state holidays. The map below pro-
vides directions to our location beginning in late spring 20051:
Exit 199 Exit 203. Interstate 10
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Orange Avenue
DIVISION OF RETIREMENT a /a�io
1317 Winewood Blvd, Bldg 8 "p
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Tallahassee, Florida
Please check our website or contact the Division for directions if you plan to
visit before then.
3
PLAN INFORMATION
Name of Plan
The Florida Retirement System (FRS) Pension Plan.
Type of Plan
The FRS Pension Plan is a defined benefit plan, qualified
under Sec. 401(a) of the Internal Revenue Code.
Administration
The Division of Retirement administers the FRS
and Service of
Pension Plan. Beginning in late spring of 20053, legal
Legal Process
process may be served on:
SARABETH SNUGGS
STATE RETIREMENT DIRECTOR
DEPARTMENT OF MANAGEMENT SERVICES
DIVISION OF RETIREMENT
1317 WINEWOOD BLVD, BLDG 8
P.O. BOX 9000
TALLAHASSEE, FLORIDA 32315 -9000
Provisions of The FRS was established in 1970 by chapter 121, Florida
Law Statutes. Changes to the law can be made only by an
act of the Florida Legislature. Rules governing the
operations and administration of the system may be
found in chapter 60S of the Florida Administrative Code.
Funding The FRS is noncontributory for members;
contributions are paid by participating employers and
then transferred to the FRS Trust Fund for investment
by the State Board of Administration to pay future
benefits to members and beneficiaries.
Plan Year The plan year is July 1st through June 30th.
Employment Membership in the FRS does not give you the right to
Rights Not be retained in the employ of a participating employer,
Implied nor does it give you a right or claim to any benefit that
you have not accrued under the system.
Retirement guides are available for each membership class. To receive a
different class guide, you may download a copy from the Publications Page on
the Division's website (www.myflorida.com /frs). Or, contact your personnel office
or the Division's Research & Education Section (see page 2).
' Before then, legal process may be served on Ms. Snuggs at: The Division of
Retirement, 2639 North Monroe Street, Bldg. C, Tallahassee, FL 32399 -1560.
4
MEMBERSHIP
M embership in the Florida Retirement System (FRS) is compul-
sory if you are working in a full-time or part -time regularly
established position in a state agency, county government,
district school board, state university', community college, or
a participating city, special district, or charter school. You are not
eligible for membership in the FRS if you work in a temporary or
independent contractor position.
Dual Membership Not Allowed
If you work at the same time in two or more jobs that are covered
by different FRS membership classes, you must be a member of
only one class. Your membership class will be determined as follows:
■ If your jobs are covered by different membership classes,
none of which is the Elected Officers' Class (EOC), you will
be a member of the class in which you are employed more
than half of the time. When your employment is split equally,
you may choose the class of membership you prefer.
■ If your jobs are covered by different membership classes,
one of which is the EOC, you may choose to participate in
any one class for which you are eligible. You will have
6 months from the date you become dually employed to
notify the Division of your decision. If you fail to notify the
Division within the 6 -month period, you will be considered
to have elected membership in the EOC.
If you are required or choose to be a member of the Regular
Class, your total salaries from all positions will be reported and
used to calculate your service credit and average final compen-
sation (AFC) at retirement. The percentage value for the
retirement credit you will earn for each year of service will be the
Regular Class value.
' Certain university employees hired on or after January 1, 1993 (instructional
or research faculty and certain administrative and professional positions) are
compulsory participants of the State University System Optional Retirement
Program unless they elect membership in the FRS.
5
When you are required or choose to be a member of the Special
Risk Class, the Special Risk Administrative Support Class, the
Senior Management Service Class (SMSC), or the Elected Officers'
Class, only the compensation you receive from that position will be
reported and used to calculate your service credit and average final
compensation at retirement. The percentage value you will earn for
each year of service will be the value for your membership class.
For more information on any other class or classes to which you
are assigned, you may access a retirement guide for any class you
need from the Publications Page of the Division's website at
www.myflorida.com /frs . Or, you may obtain information from the
Enrollments Section of the Bureau of Enrollment and Contributions
or request a retirement guide from your personnel office or from
the Research & Education Section of the Division. (See page 2 for
contact information.)
Classes of Membership
The FRS has five classes of membership, with members participating
in two primary plans, in addition to several optional programs. This
retirement guide is designed primarily for you, the Regular Class
member of the FRS Pension Plan. However, you may have belonged
in the past or may belong in the future to a different class.
The five membership classes are:
Regular Class — This class is for all members who are not as-
signed to the Special Risk, Special Risk Administrative Support,
Elected Officers', or Senior Management Service Classes.
Special Risk Class — This class is for those members who are
employed as: Law enforcement officers; firefighters, including
firefighters whose duties include fire prevention or firefighter
training and their supervisors or command officers, as well as
fixed -wing aircraft pilots conducting aerial firefighting surveil-
lance who are employed by the Division of Forestry in the
Department of Agriculture and Consumer Services; correctional
officers; community -based correctional probation officers; youth
custody officers who are employed with the Department of
Juvenile Justice and are responsible for assigned juveniles within
the community; paramedics and emergency medical technicians
and their supervisors or command officers; certain professional
health care workers who are employed by the Department of
Corrections or the Department of Children and Families in
correctional or forensic facilities; and any others who meet the
criteria in the retirement laws and rules to qualify for this class.
Special Risk Administrative Support Class — This class is for
those former Special Risk Class members who provide admini-
strative support within an FRS special risk employing agency.
Elected Officers' Class (EOC) — This class is for elected state
and county officers, and for those elected municipal or special
district officers whose governing body has chosen for its
elected officers to participate in the EOC.
Senior Management Service Class (SMSC) — This class is for
members who fill senior level management positions assigned
by law to the SMSC or authorized by law as eligible for SMSC
designation.
NOTE: See "Renewing Membership after Retirement," page 62, for infor-
mation on retirees reemployed in a covered position.
Reference: Section 121.021(12), F.S.
Section 60S- 1.004(1), F.A.C.
Optional Retirement Programs
The following nonintegrated optional retirement programs
(defined contribution plans) are available to certain groups of
covered employees:
State University System Optional Retirement Program
( SUSORP) — The State University System Optional Retirement
Program is available to faculty and administrative and profes-
sional employees of the State University System and university
presidents. These university employees are compulsory mem-
bers of the SUSORP unless they elect membership in the FRS or
fail to select a provider company within 90 days of eligibility.
7
Senior Management Service Optional Annuity Program
( SMSOAP) — The Senior Management Service Optional
Annuity Program is available to state senior managers, who
may elect membership in the SMSOAP rather than the Senior
Management Service Class (SMSC) within 90 days of becoming
a member of the class. The program is also available to members
of the Elected Officers' Class (EOC) who choose membership
in the SMSC rather than the EOC. The SMSC election must be
made within 6 months of assuming office. Elected state officers
who transfer to the SMSC may, within 90 days of becoming a
member of the class, elect membership in the SMSOAP. Note
that assistant state attorneys, assistant public defenders, assis-
tant statewide prosecutors, assistant capital collateral regional
counsels, and assistant attorneys general are not eligible to elect
participation in this program in lieu of the SMSC.
State Community College System Optional Retirement
Program ( CCORP) — The State Community College System
Optional Retirement Program is available to faculty and certain
other administrative employees of the State Community Col-
lege System, who may, within 90 days of the date the commu-
nity college activates the program or the employed s date of hire
or qualifying employment status change, whichever is later,
elect membership in the CCORP offered by the community col-
lege rather than membership in the Regular Class of the FRS. If
the election is not made within 90 days, the community college
employee will remain in the FRS.
In addition to the three nonintegrated optional retirement pro-
grams for particular employee groups, the Public Employee Opt-
ional Retirement Program (FRS Investment Plan) began enrolling
participants on July 1, 2002. The FRS Investment Plan is available
to all FRS members, except those who are participating in the
SUSORR For online updates about the FRS Investment Plan, go
to www.myfrs.com (the cooperative website of the Division and
the State Board of Administration), or call the toll -free help line at
866/446-9377.
Social Security Coverage
As a member of the FRS, you are automatically covered for Social
Security and Medicare, and your FRS benefits will not be offset
(reduced) by Social Security benefits you' receive. Social Security
contributions are automatically deducted from your salary and
matched by your employer. However, although Social Security
coverage is a part of your overall benefit package, the Division has
no control over your Social Security or Medicare benefit payments.
If you need information on Social Security or Medicare benefits. and
possible limitations on those benefits, you must call or visit your
local Social Security office, call their toll-free information number
(800/.772- 1213), or visit their Internet site at www.ssa.gov.
Portability
One of the special features of membership in the FRS is statewide
portability (the ability to keep your retirement credit when you
change FRS employers). If you terminate employment with one FRS
employer and at any later time go to work with any of the more than
800 public employers covered by the FRS, the service credit you earn
at your new job will be combined with the service credit you earned
in your previous job. All service credit you earn under the FRS while
working for any FRS employer is automatically combined in one ac-
count under your name and Social Security number.
The FRS Pension Plan also offers pension portability in other ways.
For example, if you were a member before 1975 when the system
became employee - noncontributory, you may have taken a refund of
your personal contributions and lost the associated service credit.
If so, after returning to covered employment, you could repay those
contributions, plus interest, and reestablish service credit for your
"refunded service." Or, if you have service credit under a pension
plan with a public employer in another state, with the federal gov-
ernment (including military service), or with an eligible employer
in Florida, you may be eligible to buy credit under the FRS Pension
Plan for that service. (See page 28 for information on types of creditable
service for 7v1ich you may obtain credit.)
Reference: Sections 121.051, 121.052,121.055(6), and 121.35, F.S.
Sections 60S- 1.004(2)(c) and (d), F.A.C.
0
CONTRIBUTIONS
The FRS is an employee- noncontributory system. In other words,
your employer pays all the retirement contributions necessary
for you to earn service credit toward a future retirement benefit. No
money is deducted from your salary to pay for your retirement.
Employee contributions have not been required since January 1,
1975, for employees of state agencies, district school boards, and
community colleges, and since October 1, 1975, for employees of
county governments, cities, and special districts. If you worked in
a covered position before these dates, you made retirement contri-
butions, which are on deposit in your name unless you left your
job and received a refund of your contributions.
Your employer pays retirement contributions equal to a certain
percentage of your salary each month. While these rates are sub-
ject to change by the Florida Legislature, effective July 1, 2004, the
retirement contribution rates paid by your employer on your behalf
were:
Employer Retirement and Health Insurance Subsidy
Contribution Rates
Effective July 1, 2004
Membership
Class Retirement* HIS Admin Fee TOTAL
Regular Class 6.20% 1.11% 0.08% 7.39%
Rates are subject to change annually. The retirement rate sh07on above is the
uniform, blended employer contribution rate established by la7o and paid on
behalf of members in the Regular Class of the FRS Pension Plan or the FRS
Investment Plan. This rate is reduced, offset by use of available surplus from the
FRS Trust Fund. Without offset, the blended retirement rate required to fund
the true normal cost of retirenient benefits for the Regular Class Would have
been 9.98 %, as compared to the 6.20% rate s1107on above.
Reference: Sections 121.071(4), 121.71, and 121.74, F.S.
Sections 60S -3.003 and 3.010, F.A.C.
10
Refund of Contributions
You may have paid employee contributions if:
1. You were a member of the FRS in or before 1975; or
2. You purchased additional service credit.
You may request a refund of your personal contributions if you
terminate all covered employment. Your refund will not include
contributions made by your employer, nor will it include
interest earnings, except for interest that would be credited to your
account for any service as a member of the Teachers' Retirement
System (TRS).
To request a refund of your personal contributions, contact the
Bureau of Retirement Calculations (see page 1). However, you will
lose all retirement credit for your refunded service. If you return
to covered employment for 1 complete work year within a period
of 12 consecutive months, you may purchase credit for refunded
service.
Employer -paid contributions are not refundable. You will retain all
service credit funded solely by employer -paid contributions unless
you forfeit your benefits (see page 63).
Reference: Sections 121.071(2)(b) and 121.091(5), F.S.
Sections 60S- 3.002(6) and (7) and 4.009(1) F.A.C.
11
BENEFICIARY DESIGNATION
As a member of the FRS (whether in the FRS Pension Plan or
the FRS Investment Plan), we encourage you to designate a
beneficiary or beneficiaries and keep your designation up to date.
Before You Retire
As an FRS Pension Plan member, your surviving spouse is auto-
matically your beneficiary unless you designated someone else
after your most recent marriage.
To designate a beneficiary or beneficiaries, you must complete
Form BEN -001, which you may obtain from the Forms Page of our
website (www.myflorida.com /frs), from your personnel office, or
from the Enrollment Section (see page 2). You may designate your
beneficiary or beneficiaries either jointly or sequentially, or specify
that any benefits due be paid through a trust. If you fail to name
a beneficiary and are not survived by a spouse, or if none of your
named beneficiaries are living upon your death, your benefi-
ciary will be determined by law; or, if you wish, you may designate
"By Law" on the Form BEN -001. In either case, your beneficiary
would be determined as follows:
... if no beneficiary designated by the member survives
the member, the beneficiary shall be the spouse of the
deceased, if living. If the member's spouse is not alive at
his or her death, the beneficiary shall be the living children
[sic] of the member. If no children survive, the beneficiary
shall be the member's father or mother, if Iiving; otherwise,
the beneficiary shall be the member's estate.
(s. 121.091(8) (a), F.S. )
As an active member, you may change your beneficiary at any time.
This is important to remember if your beneficiary dies, your marital
status changes, or you have children. Your will, trust agreement, or
divorce decree has no bearing on how survivor benefits are paid.
If you have questions about your current beneficiary desig-
nation, you may be able to verify the information online
12
(www.myflorida.com /frs). If your current beneficiary information
isn t listed on the website, please contact the Enrollment Section of
the Bureau of Enrollment & Contributions (see page 2).
When You Retire
On your application for retirement, you will be asked to rename
your beneficiary and choose a benefit payment option (see page 47):
■ If you choose option 1 or 2, you may name as beneficiary
any person, organization, trust, or your estate. You may
name one or more beneficiaries to receive benefits jointly or
sequentially.
If you choose option 2, you may name one or more contin-
gent beneficiaries to receive any benefits remaining after
your death and the death of your primary beneficiary or
beneficiaries.
If you choose either option 3 or 4, your beneficiary must
qualify as your joint annuitant. If you choose option 3,
you may name more than one joint annuitant, and specify
the proportion of the benefit to be paid to each. A joint
annuitant is defined as:
• The member's spouse; or
• The member's natural or legally adopted child who is
either under age 25 or is physically or mentally disab-
led and incapable of self - support (regardless of age);
or
• The member's parent or grandparent who was de-
pendent upon the member for at least one -half of his or
her financial support at the time of death; or
• A person for whom the member is the legal guardian,
and who was dependent upon the member for at least
one -half of his or her financial support at the time of
death.
13
After You Retire
If you choose option 1 or 2, you may change your beneficiary des-
ignation at any time.
If you choose option 3 or 4:
■ The joint annuitant named at retirement remains your
joint annuitant unless you nullify or change the designa-
tion. A marriage or divorce after retirement does not
change your designated joint annuitant unless you change
your designation.
■ You may change your joint annuitant only two times after
you retire. Whenever you change your joint annuitant,
your monthly benefit will be adjusted based on your cur-
rent age, the age of your new joint annuitant, and whether
or not your present joint annuitant is living. The change
will be effective the first day of the month after the Division
receives your completed Change of Joint Annuitant Form
(Form JA -1).
■ If you divorce the person you named as your joint annui-
tant, you may nullify your designation of that joint
annuitant (unless a Qualified Domestic Relations Order
prevents it). After nullification, your benefits will be paid
as if your joint annuitant had died. The nullification will
be effective the first day of the month after the Division
receives your completed Joint Annuitant Nullification
Form (Form JA -NUL) and a copy of your divorce papers.
Reference: Sections 121.091(6) and (8), F.S.
Sections 60S- 4.010(1) and (8) and 4.011, F.A.C.
'14
VESTING
Being vested means that you have met the age and /or service
requirements to be eligible to receive a retirement benefit one
day. If you were employed in a covered position on July 1, 2001,
or first became employed in a covered position after that date,
you will be vested under the FRS Pension Plan after completing
6 years of creditable service, regardless of your membership class.
Before July 1, 2001, members of the Regular Class vested in the
FRS Pension Plan after completing 10 years of creditable service.
If you terminated covered employment before July 1, 2001, and
you were more than 1 year away from vet at the time, you
must work for 1 work year after you return to covered employ-
ment before you will be eligible for 6 -year vesting. However, if you
were within 1 work year of vesting under the provisions of law in
place when you terminated employment, you will vest upon work-
ing the number of months that were required for you to vest before
you terminated.
Once you are vested, you are eligible for a future benefit when you
leave covered employment and apply for your retirement benefit.
Being vested does not entitle you to a disability benefit based on a
disability that occurs after you terminate employment.
You will lose your vested rights if:
■ You have to forfeit your benefits as described on page 63.
• You have fewer years of service than are required to vest
because you took a refund of your personal contributions
and lost the service credit associated with your refunded
service. (See "Refund of Contributions" on page 11.)
NOTE: Vesting requirements for FRS disability retirement differ from
those for service retirement. Please read the Disability Retirement
section for more information (see page 53).
Reference: Sections 121.021(45) and 121.091, F.S.
Section 60S- 4.003, F.A.C.
15
TERMINATING EMPLOYMENT
Whenever you terminate your covered employment before
retiring, you have some decisions to make. Your available
options under the FRS Pension Plan will vary depending upon
your vesting status at the time of your termination.
NOTE: Members of the FRS Investment Plan will have different decisions
to make. If a terminated FRS Investment Plan member requests and
receives a distribution of funds, in whole or in part, he /she will be
considered to have retired. Such a retiree is subject to the same laws
and rules regarding reemployment after retirement and renewed mem-
bership as apply to FRS Pension Plan retirees. For instance, a renewed
member is not eligible to participate in the Special Risk Class or the
Deferred Retirement Option Program DR P , and is not covered
for disability retirement. For more information, FRS Investment Plan
members should call the toll-free number 866/446 -9377.
Before You Are Vested
If you terminate before you have vested, you are not eligible to
retire. However, the service credit you earned is not lost and will
be combined with any future service credit you earn for covered
employment in the future.
If you personally contributed to the system, either during a time
when employee contributions were required under the FRS (see
page 10) or to purchase optional service credit, you must decide
what to do about your personal contributions. When you termi-
nate employment, you can choose to:
■ Take a refund of your personal contributions; or
■ Leave your contributions on deposit with the FRS and
retain all the service credit you have earned, which will be
combined with future creditable service in the event you
return to covered employment and resume membership.
If you do elect to take a refund of your personal contributions and
later return to covered employment, all service credit represented by
the refund is cancelled. You must be employed for 1 work year be-
fore you can repay the personal contributions refunded to you, plus
interest, and restore the service credit represented by the refund.
16
After You Are Vested
If you are vested when you terminate, you could choose to retire.
(See page 45 for termination requirements that must be met when you
retire.) If you elect to retire, depending on your age, you could
take a normal retirement or early retirement, or you could defer
your retirement to a future date of your choice:
• If you qualify for normal retirement, your unreduced
benefit will be based on all years of service for which you
either earned or purchased service credit (see page 28).
• If you choose to retire early (before reaching your normal
retirement date), your benefit will be reduced based upon
your age at retirement (see page 44).
• To avoid or minimize benefit reduction for early retirement,
you could choose to postpone your retirement; if you defer
retirement, your benefit amount will be calculated based
upon your age when you begin receiving benefits.
If you elect not to retire, you will retain your earned service
credit. This credit will be combined with any service credit you
earn for any future covered employment.
If you have personal contributions on deposit when you terminate,
you can:
v Take a refund of your personal contributions; or
■ Leave your personal contributions on deposit.
If you later return to covered employment before retiring, you will
retain all of your earlier noncontributory service credit as well as
credit for any contributory service for which you left your contri-
butions on deposit. If you elect to obtain a refund of your personal
contributions, all service credit represented by the refund is
cancelled. You can reinstate this service credit by repaying your
refunded contributions, plus interest, but you must continue in
covered employment for 1 work year before you will be permitted
to do so (see page 29).
Reference: Sections 121.021(39), 121.081(2), and 171.091, F.S.
Sections 60S- 3.002(6) and 4.009, F.A.C.
'17
YOUR RETIREMENT BENEFIT
The monthly benefit payment you receive when you retire is
based on your years of creditable service, your average final
compensation, the value you receive for each year of service, and
the option you select, as described below.
Retirement Benefit Formula
The formula for calculating a yearly option 1 benefit is:
Years of Average Yearly
Creditable Percentage Final Option 1 Benefit
Service X Value X Compensation = at Normal Retirement
Yearly Benefit _ 12 = Monthly Option 1 Benefit
Years of Creditable Service
"Years of creditable service" is the total of all years and parts of
years you worked in a covered position with an FRS employer,
plus any additional service credit that you purchase.
Average Final Compensation
Average final compensation (AFC) is the average of the 5 highest fiscal
years of compensation you earned during your covered employment.
For retirement purposes, your salary records are kept by fiscal year
(July 1 - June 30). Certain kinds of payments, such as lump -sum sick
leave payments, retirement incentive bonuses, and lump -sum annual
leave payments in excess of 500 hours, cannot be included in your
AFC. (See Wile 60S- 6.001(6), F.A.C., for a listing ofexcluded payments.)
NOTE: For participants of the Hybrid Plan, the AFC is calculated using the
highest 5 fiscal years of compensation earned while participating in
the FRS Pension Plan.
Percentage Value
Percentage value is the value that you receive for each year of your
creditable service. The following chart shows the percentage values
appropriate for each class or plan of which you may have been a
member.
18
Percentage Value for a Year of Retirement Credit
The charts below list the percentage value earned for each year of
service credit, by class or plan. The value for your service in the
Regular Class is listed first, followed by values for service in other
membership classes or plans in which you may have participated:
Retirement Class /Plan
% Value
(per year of service)
Regular Class
Retirement at age 62 or 30 years
1.60%
Retirement at age 63 or 31 years
1.63%
Retirement at age 64 or 32 years
1.65%
Retirement at age 65 or 33 years
1.68%
Service credit earned as a member of any of the other FRS classes
(Special Risk Class, Special Risk Administrative Support Class,
Elected Officers' Class, or Senior Management Service Class), the
State and County Officers and Employees' Retirement System,
or the Teachers' Retirement System will be valued according to
the percentage value provided by the class or plan at the time of
service. Applicable rates are listed below:
Special Risk Class
Service from 12/1/70 through 9/30/74 2.00%
Service on and after 10/1/74 3.00%
Past service with city or special district
purchased as special risk service 2.00%
Special Risk Administrative Support Class 5
Retirement at age 55; or with 25 years service; or
at age 52 with 25 years of service, including
military service 1.60%
s To be eligible for retirement under this class, you must have a minimum of
6 years' special risk or special- risk - related service credit.
19
Retirement at age 56; or with 26 years service;
or at age 53 with 26 years of service,
including military service 1.63%
Retirement at age 57; or with 27 years service;
or at age 54 with 27 years of service,
including military service 1.65%
Retirement at age 58; or with 28 years service;
or at age 55 with 28 years of service,
including military service 1.68%
Elected Officers' Class
Judges and Justices 3.33%
All Others 3.00%
Senior Management Service Class 2.00%
State & County Officers & Employees'
Retirement System
Division A (no social security) 2.00%
Division A (no social security-high hazard) 2.00%
Division B (w/ social security) 1.50%
Division B (w/ social security-high hazard) 1.50%
Teachers' Retirement System
Plan E (no social security) 2.00%
20
Steps to Calculate a Benefit for a Vested Member *:
1. Determine the number of years of creditable service you have
in each class, as applicable.
2. Multiply the percentage value for a year of service in a class
(see charts on pages 19 -20) by your years of service in that class
to obtain a subtotal for each class.
3. Add the percentage values for each class in which you had
creditable service (subtotals in step 2) to determine your total
percentage value for all classes.
4. Multiply your average final compensation (the average of your
highest 5 fiscal years of salary) by the total percentage value
derived in step 3 to determine your annual option 1 benefit.
5. If you chose to retire early, your benefit would be reduced by
5% for each year remaining before you would reach your
normal retirement AZe of 62.
6. Your benefit may also be reduced if you elect to provide a contin-
uing benefit to a beneficiary (see discussion of benefit payment
options on page 47).
* Your personal information, including your service credit and fiscal year sala-
ries, is available to you online. If you are vested, a summary of your personal
information With projected estimates is also provided to you each year as part
of your Member Annual Statement (see page 26). (For more information, see
"Information Requests" on page 24.)
NOTE: The method for calculating disability retirements may be different.
See discussion on page 53, or see the "Florida Retirement System
Disability Benefits" booklet.
21
EXAMPLE for a Normal Retirement * *:
Following the steps listed on page 21, assume that Anna is a
regular member retiring at age 60 with 27 years of Regular Class
service and 4 years of service in the Senior Management Service
Class and that her average final compensation (AFC) is $50,000.
With 31 years of creditable service in the FRS, Anna would re-
ceive 1.63% for each year of Regular Class service and 2.00% for
each year of service in the Senior Management Service Class. Her
benefit would be calculated as follows:
Class
Years of
Service
% Value per
Year of Service
% Value
for Class
Regular Class
27
1.63%
44.01%
Sr. Management
Service Class
4
2.00%
8.00%
TOTAL % Value:
52.01%
1. To determine her initial annual option 1 retirement benefit,
Anna would simply multiply her AFC by her total percentage
value as shown below:
$50,000 X 52.01% _ $26,005
2. Although it would be 2 years before Anna would reach
age 62, with over 30 years of total service she qualifies for
normal retirement, so her benefit would not be reduced for
early retirement.
3. If Anna elected to take an option 2, 3, or 4 benefit to cover one
or more beneficiaries, her $26,005 annual benefit amount
would be actuarially adjusted to reflect the cost of the addi-
tional coverage. (For more on payment options, see page 47.)
** This illustration is only an example and is unlikely to be the same as your
estimated benefit.
22
EXAMPLE for an Early Retirement:
If Anna had retired 2 years earlier (at age 58 with 29 years of ser-
vice), her benefit would have been reduced for early retirement.
To determine her early benefit, Anna must first calculate the value
of her unreduced benefit. Assume that she has the same average
final compensation (AFC), but with 25 years of Regular Class
service and 4 years in the Senior Management Service Class. With a
total of 29 years of creditable service in the FRS, Anna would receive
1.60% for each year of Regular Class service and 2.00% for each
year in the Senior Management Service Class. Since she has fewer
than 30 years of service, her resulting normal benefit would then
be reduced by 5% for each year remaining before she would reach
age 62. Anna's early benefit would be calculated as follows:
Years of % Value per % Value
Class Service Year of Service for Class
Regular Class 25 1.60% 40.00%
Sr. Management
Service Class 4 2.00% 8.00%
TOTAL % Value: 48.00%
1. To compute her unreduced annual option 1 retirement benefit,
Anna would multiply her AFC by her total percentage value:
$50,000 X 48.00% _ $24,000
2. Because Anna has fewer than 30 years of service and would
not be age 62 for 4 years, her annual option 1 benefit must then
be reduced by 20% (5% for each year), as shown below:
$24,000 X 20% _ $4,800
$24,000 — $4,800 = $19,200
3. If Anna took an option 2, 3, or 4 benefit to cover one or more
beneficiaries, her $19,200 early annual benefit amount would
be actuarially adjusted to reflect the cost of the additional
coverage. (For more on early retirement, see page 44, and for more
Oil payment options, see page 47.)
Reference: Section 121.091, F.S.
Sections 605 -4.004 and 6.001(6), F.A.C.
23
INFORMATION REQUESTS
The Division of Retirement's website has an interactive services
area called Retirement Online which makes retirement infor-
mation available to members of the FRS Pension Plan. Within
Retirement Online, members and retirees — including partici-
pants of the Deferred Retirement Option Program, or DROP
— can access their personal retirement account information, as
well as perform informal benefit estimates.
Online Information & Estimates
With Retirement Online, you can use the Internet to securely obtain
information specific to your personal retirement account, such
as your service history and service credit information, salary data,
and beneficiary information. You can also perform unofficial ben-
efit estimates (including DROP estimates) based on retirement
ages you assume.
To get into Retirement Online, go to the Division's website at
www.myflorida.com /frs and select "Online Services" from the menu
bar on the left side of your screen. To obtain information about
your account or perform estimates, you must log in, following the
instructions provided via the Help screens.
In addition to this interactive service, all of the Division's inform-
ational publications, most retirement forms, and answers to
frequently asked questions (FAQs) are available to you online
through the Division's website at the address shown above.
24
Official Estirnate Requests
If you need a formal estimate from the Division, upon your
request, the Division will audit your account and provide to you:
1. A statement of your total years of creditable service and the
cost to purchase additional service credit, if any.
2. An estimate of benefits effective with your proposed retire-
ment date, or after you terminate employment if you are
vested. If you are actively employed and receive an estimate of
benefits projected to your normal retirement date, you will also
receive a statement showing how much you could accumulate
if you choose to participate in DROP and continue employ-
ment for up to 5 more years. (See page 37 for more informa-
tion.)
We encourage you to request an estimate of your account from the
Division if you are within 5 years of your anticipated retirement.
You may request an audit of your account by any of the follow-
ing methods, and the results of your audit will be mailed to the
address you provide:
• Visit our Internet website at www.myflorida.com /frs and
open the Estimates Page. Click on the "Request an Audit/
Estimate" link and complete and submit the required
information.
• Obtain an Information Request (Form FR -9) from your
personnel office or download a copy from the Forms Page
of our Internet website (see above). After you complete the
request form, you may have your personnel office mail it to
the Division, or you may write to us directly. If you write,
please include your full name, Social Security number, mail-
ing address, and daytime telephone number. Your audit
results will be mailed to the address you provide.
• Telephone the Bureau of Retirement Calculations at
850/488 -6491 or SUNCOM 278 -6491. A counselor will
assist you.
25
Other Estimates
Member Annual Statements are provided to all vested active
members of the FRS Pension Plan in the fall of each year based on
their service through the previous June 30. If you are not vested,
you will receive a statement of your total years of service. Your an-
nual statement will be mailed to your home address, if provided
by your employer; otherwise, your statement will be distributed to
you through your personnel office. (Because the Division obtains
all member addresses from FRS employers in the monthly report-
ing process, to ensure timely receipt of your statement, please
keep your employer informed of any changes in your mailing
address.) Please contact the Bureau of Retirement Calculations (see
contact information on page 1) with any questions you may have
about your member annual statement.
Personal Retirement Forecast Statements (PRFS) are being gen-
erated by the MyFRS Financial Guidance Program beginning
in the fall of 2004. The PRFS will be sent annually to all active
members having more than 1 year of service when the statement
is generated. It is designed to provide you additional information
to help in your overall retirement planning, and offers planning
information from a different perspective than your Member
Annual Statement. It is not a replacement for that statement.
If you have questions about your PRFS, please contact the MyFRS
Financial Guidance Program toll -free at 1- 866 - 446 -9377 (option 1),
or log on to www.myfrs.com.
001
CREDITABLE SERVICE
You earn retirement credit for your service (creditable service)
when you are paid for work in a covered position with one or
more of the approximately 800 public employers that participate in
the FRS. You do not earn service credit under the FRS Pension Plan
as a temporary employee or independent contractor, or for any
period that you are participating in any of the following optional
retirement programs (as described on pages 7 and 37):
■ The Deferred Retirement Option Program;
■ The State University System Optional Retirement Program;
■ The State Community College System Optional Retire-
ment Program;
■ The Senior Management Service Optional Annuity Pro-
gram or in a local government alternative plan in lieu of
participating in the Senior Management Service Class; or
■ The Public Employee Optional Retirement Program (FRS
Investment Plan).
Counting Your Years of Creditable Service
You earn a full month of creditable service for each month in which
you receive a salary payment. However, during the period from
July 1, 1974, through June 30,1985, a minimum monthly salary was
required for you to receive full credit for your service. If you earned
less than the minimum monthly salary for any month during this
period, your service credit is reduced proportionately for that month.
Creditable service is earned for the work year — 12 months of a fis-
cal year (July 1- June 30) for most members, and a shorter period for
some employees of district school boards, universities, community
colleges, charter schools, developmental research schools, and cer-
tain members who perform services for district school boards but
actually work for another employer. When you work the required
number of months in your work year, you receive a full year of ser-
vice credit. You cannot earn more than 1 year of creditable service
in a fiscal year. If you work less than the required work year,
you receive credit for part of a year.
27
For example, a deputy sheriff with a 12 -month work year who
works 9 months of that year will receive service credit for
75 percent of the work year (9 - 12 = 0.75). A teacher who works
6 months of a 10 -month work year will receive service credit for
60 percent of that year (6 _ 10 = 0.60).
Reference: Section 121.021(17), F.S.
Section 60S- 2.002(4), F.A.C.
Other Types of Creditable Service
In addition to the service credit you earn for current work, you
may be able to purchase credit under the FRS Pension Plan for
certain other types of service to increase your benefit. You must
pay any required retirement contributions, plus interest, for the
extra service credit. (In some cases, your employer may pay some
or all of the cost for this credit.)
For the purchase of credit under the FRS Pension Plan, the Divis-
ion will accept trustee -to- trustee transfers from your deferred
compensation plan account, your tax sheltered annuity plan
account, or another tax deferred account, including the State of
Florida Deferred Compensation Plan and 403(b) plans offered by
educational institutions.
To be eligible for transfer, the plan must be authorized under one
of the following sections of the Internal Revenue Code: 401(a),
403(b), 408(a) or (b), or 457(b). If you wish to buy service credit
under the FRS Pension Plan and pay for it with funds transferred
from your tax deferred plan account, please download a copy of
the Pretax Direct Rollover Form, Form PROA, from the Division's
website at: www.myflorida.com /frs . Or, contact the Bureau of Retire-
ment Calculations at (850) 488 -6491 or SUNCOM 278 -6491 and ask
for the form. (Note that you may also need a separate form from
your provider company or plan sponsor, so you should contact
them also.)
The cost for the additional retirement credit depends on the type
of service. Once you are eligible to buy the service credit, you may
pay the amount due at any time before you retire. Interest is com-
pounded annually and is charged once a year on the balance
remaining as of June 30. Please contact your personnel office
or the Division's Bureau of Retirement Calculations (see page 1) if
you need additional information on claiming creditable service as
described below:
1. Prior Service - Prior service is employment with an agency par-
ticipating in a state - administered retirement system in Florida for
which you either paid no contributions or withdrew your con-
tributions. To purchase credit for your prior service, you must
be reemployed as a member of the FRS for at least 1 complete
work year and pay the required contributions, plus interest. The
types of prior service for which you may be able to purchase
service credit are:
■ Refunded Service - If you terminated employment and
obtained a refund of your employee contributions, you lost
credit for the service represented by those contributions.
■ Non - Membership Service - If you were working before
December 1, 1970, with an employer who was participating
in a state - administered retirement system, but were not in
covered employment, you may be eligible to buy credit for
the service. However, your employment must have been
in a regularly established position — you cannot purchase
credit for employment in a temporary position, such as an
"other personal services" (OPS) position.
Reference: Sections 121.021(19) and 121.081(2), F.S.
Sections 60S -2.004 and 3.005, F.A.C.
2. Past Service - Past service is employment with:
■ A city or special district before it joined the FRS;
■ A local entity or function that was transferred to, merged
with, or assumed by a state or local government agency,
resulting in you becoming a member of the FRS;
■ The Cuban Refugee Assistance Program, administered by
the Florida State Department of Public Welfare or the
Florida State Board of Health before January 1,1968; or
■ A Multiple Offender Project supervised by the State Attor-
ney's office and funded by a federal government grant to a
local government not covered by the FRS.
Reference: Sections 121.021(18) and 121.081(1), F.S.
Sections 60S -2.003 and 3.004, F.A.C.
29
3. Military Service - Military service may be claimed in one of the
ways listed below:
• If you were first employed in a covered position before
January 1, 1987, you may purchase up to 4 years of service
credit for your wartime military service [s. 121.111(2), F.S.I.
■ If you left covered employment to join the military and
returned to covered employment afterwards, you may be
entitled to coverage for military service as a military leave
of absence [s. 121.111(1), F.S.].
■ If your military service is not creditable as described
above, see page 33 for information on purchasing your mili-
tary service as federal service under provisions of law
relating to out -of -state service.
If you wish to claim credit for your military service, you must
submit a copy of your certificate of service (Form DD -214, or
equivalent) showing your dates of entry into and discharge
from active duty so that we may determine your eligibility.
Wartime Military Service
If you were in a covered position before January 1, 1987, you
may purchase credit for up to 4 years of active duty wartime
service with the United States Armed Forces or the Allied
Forces from which you were honorably discharged.
You must be vested in the FRS Pension Plan before you may
claim and pay for wartime military service credit.
You will not receive any credit for military service that is also
credited toward any other federal, state, or local retirement
benefit where "length of service" is a factor. However, credit
may be granted for active duty wartime service that also ap-
plies toward a benefit from the United States Armed Forces
Reserves or National Guard (under Chapter 67 of Title 10 of the
United States Code).
30
Your military service must fall within "wartime" periods as
defined by s. 1.01(14), F.S. Some wartime periods are listed in
the following paragraphs (the dates of wartime periods before
World War II may be requested from the Division):
World War II - December 7,1941, through December 31,
1946 (including service as a Merchant Marine from
December 7,1941, through August 15,1945, if authorized
on a Form DD- 214 or equivalent).
Korean Conflict -June 27, 1950, through January 31, 1955.
Vietnam Era - February 28,1961, through May 7,1975.
Persian Gulf War - August 2,1990, through
January 2,1992.
If one or more days of any period of your active military service
occurred during the dates identified by law as "wartime," you
may claim credit for that entire period — not to exceed 4 years.
For example, if your active military service was from January 1,
1955, through January 1, 1960, you are eligible to claim 4 years
of this service because a portion of your time (at least 1 day) fell
within the active duty wartime period defined as the Korean
Conflict.
All service claimed under this provision of law will be valued
at the Regular Class value for each year claimed, regardless of
your actual class of membership.
31
Military Leave of Absence
A military leave of absence occurs when you leave covered
employment to serve in the military. To receive service credit
for this time, you must be honorably discharged and be
entitled to return to work under provisions of the Uniformed
Services Employment and Reemployment Act (Chapter 43 of
Title 38 of the United States Code) and you must satisfy the
conditions of that act. After you return to covered employment,
you may receive credit for up to 5 years of active duty military
service (or more if your service was extended for the conve-
nience of the Federal Government).
Service credit for a military leave of absence will count toward
the years of service you need to vest, and you don t need to be
vested before you can receive such credit. If your military leave
of absence ends on or after December 3, 1974, and certain crite-
ria are met, your employer must pay all employer contributions
required during the period of your absence.
Reference: Sections 1.01(14), 121.021(20) and 121.111, F.S.
Sections 60S -2.005 and 3.006, F.A.C.
4. Leave of Absence without Pay - A leave of absence without
pay is a period of time when you are on an approved absence
from work, without pay, and plan to return to work after your
leave (including a leave of absence taken due to resignation to
run for Sheriff or Police Chief or a leave taken under the
Family Medical Leave Act). You must return to work immed-
iately following the approved leave and be actively employed
for at least 1 calendar month in order to qualify to purchase
retirement credit for the leave. You may purchase credit for up
to 2 work years of approved leaves. Before we can calculate the
cost of your leave, you must complete and send to the Division
an Application to Purchase Retirement Credit for a Leave of
Absence (Form FR -28). You may pay for the leave anytime
before retirement, but this service credit does not count toward
the years of service you need to be vested.
Reference: Section 121.121, F.S.
Sections 60S -2.006 and 3.007, F.A.C.
32
5. In -State Service - You may be eligible to purchase service credit
under the FRS Pension Plan for up to 5 years of in -state public
employment or nonpublic employment in certain schools or
colleges. Qualifying service includes public employment not
covered by the FRS, employment with a charter school, and
employment with a nonpublic school or college accredited by
the Southern Association of Colleges and Schools, subject to the
following requirements:
• The service claimed must have been covered by a retire-
ment or pension plan provided by your employer.
• If the service credit you earned under another retirement
or pension plan entitles you to receive a current or future
benefit under that plan, you cannot buy credit for that
service under the FRS. Or, if you received a refund of con-
tributions from the other retirement system and the refund
included any contributions made by the employer, you
cannot buy FRS credit for that service.
• You must have 1 work year of covered employment after the
in -state service to qualify to purchase credit for this service.
• All service claimed will be credited as Regular Class service.
• If you also wish to purchase service credit for your out -of-
state public service (see item 6), the combined total years of
credit purchased for your in -state and out -of -state service
may not exceed 5 years.
• You may purchase credit for your in -state service on a
year -for -year basis as you complete an equal or greater
amount of FRS service.
• You must be vested in the FRS before the in -state service
will be creditable under the FRS.
Reference: Section 121.1122, F.S.
Sections 60S -2.007 and 3.008, F.A.C.
6. Out -of -State Service - The following types of employment
outside the State of Florida may be creditable under the FRS:
Out -of -State Public Service and Federal Service - FRS
You may be eligible to purchase service credit under the FRS Pen-
sion Plan for up to 5 years of out -of -state public employment or
federal employment. The service claimed must have been for peri-
33
ods of public employment in another state or a political subdivision
of another state or for the federal government (including military
service not otherwise creditable under the FRS).
To claim credit for this service, you must meet the following
requirements:
• The service claimed must have been covered by a retire-
ment or pension plan provided by your employer.
• If the service credit you earned under another retirement
or pension plan entitles you to receive a current or future
benefit under that plan, you cannot buy credit for that
service under the FRS. Or, if you received a refund of contri-
butions from the other retirement system and the refund
included ani contributions made by your employer, you
cannot buy FRS credit for that service.
• You must have 1 work year of covered employment after
your out -of -state service to qualify to purchase credit for
this service.
■ All service claimed will be credited as Regular Class service.
■ If you also wish to purchase service credit for your in -state
service (see item 5), the combined total years of credit pur-
chased for your in -state and out -of -state service may not
exceed 5 years.
■ You may purchase credit for your out -of -state service on a
year- for -year basis as you complete an equal or greater
amount of FRS service.
■ You must be vested in the FRS before the out -of -state
service will be creditable under the FRS.
Reference: Section 121.1115, F.S.
Sections 605 -2.007 and 3.008, F.A.C.
Out -of -State Teaching Service -
Teachers' Retirement System
If you were a member of the Teachers' Retirement System (TRS)
before you became a member of the FRS Pension Plan, you
may be eligible to claim credit for your out -of -state public teach-
ing service based on TRS provisions governing the purchase of
such credit.
Reference: Section 238.06, F.S.
34
Out -of -State Seasonal Agricultural Work
If you are a seasonal agricultural state employee who works
for the Department of Agriculture and Consumer Services in
Florida for 6 or more months during a fiscal year (July 1
- June 30) and you work in another state in a similar capacity
during the same fiscal year, you may be able to purchase
credit under the FRS Pension Plan for your actual time in out -
of -state seasonal agricultural service.
Reference: Sections 121.011(3),121.051(6)(a), 121.1115,121.1122,238.06(4), F.S.
Sections 60S -2.007 and 3.008, F.A.C.
7. Workers' Compensation Credit - Periods when you receive
temporary Workers' Compensation payments are creditable
for retirement under the FRS if you return to work in a covered
position for 1 calendar month or retire on disability. Your
employer must report such periods to the Division to ensure
you receive this service credit at no cost to you.
Reference: Section 121.125, F.S.
Section 60S- 2.012, F.A.C.
8. Periods of Suspension without Pay - If you are suspended
without pay and later reinstated, you may purchase service
credit for up to 24 months of your period of suspension. To be
eligible to purchase such service credit, you must provide docu-
mentation of your suspension and reinstatement and return to
active employment for at least 1 calendar month following
your period of suspension. If your suspension without pay is
retroactively changed to a suspension or reinstatement with
pay, your employer must pay any applicable contributions for
the affected period of suspension.
Reference: Section 121.011(3)(e), F.S.
Sections 60S -2.016 and 3.014, F.A.C.
9. Dismissal and Reinstatement - If you are dismissed by your
employer and your dismissal is later rescinded by proper auth-
ority or through legal action, you may be eligible to receive re-
tirement credit for this period of dismissal. Your employer must
pay the required retirement contributions due for any portion
of the dismissal period for which you are "made whole,"
35
plus interest. If, however, your dismissal period, or a portion of
your dismissal period, were later changed from a termination
to a suspension by proper authority or legal action, to receive
retirement credit for this period, you would be required to buy
the credit (see item 8).
Reference: Section 121.011(3)(g), F.S.
10. Reemployed Retiree Service before July 1, 1991 - If you be-
came a renewed member on or after July 1, 1991, you may
buy credit toward your second - career retirement benefit for
your service in a covered position after your first retirement and
before you became a renewed member.
Reference: Section 238.175, F.S.
Sections 60S-2.014,3.004(l), and 3.005, F.A.C.
11. Teaching in a Federally Operated School in Florida - You may
purchase credit for teaching service in a public school located in
Florida and operated by the United States Government, as long
as the service does not entitle you to a current or future benefit
under any other state or federal retirement system.
Reference: Section 238.175, F.S.
Sections 60S- 2.014, 3.004(1), and 3.005, F.A.C.
12. Periods of Disability Retirement - If you retire on disability
and later recover and return to a covered position, and you
are continuously employed for at least 1 work year, you may
purchase service credit for the period while you were retired
on disability.
Reference: Section 121.091(4)(h), F.S.
Sections 60S-2.018,3.017, and 4.007(8), F.A.C.
Some of the forms required above are available online. Check the
Forms Page of the Division's website at www.myflorida.com /frs for
required forms.
36
DEFERRED RETIREMENT OPTION PROGRAM
-re Deferred Retirement Option Program (DROP) is offered for
members who have reached their normal retirement date. This
program allows you to effectively retire without terminating your
employment. While participating in the program, your monthly
retirement benefits accumulate in the FRS Trust Fund, earning tax
deferred interest, while you continue to work and earn a salary (but
no additional retirement service credit).
When your DROP participation period ends, you must terminate
all employment with all FRS employers or forfeit your DROP
benefits. At that time, you will receive your accumulated program
benefits, and begin receiving your monthly retirement benefit.
(Your monthly benefit will be the amount determined when your
program participation started, based upon your service credit and
salary at that time, plus annual cost -of -living increases). For many,
DROP offers the "best of both worlds," providing both a guaran-
teed lifetime benefit and a lump sum you can invest or spend after
your program participation ends.
For most participants in DROP, the maximum participation period
is 60 months and the termination requirement applies at the end of
the participation period. However, some exceptions apply:
■ A DROP participant serving in an elective office covered by
the Elected Officers' Class when the participation period
ends may not have to terminate employment to end his/her
program participation. The elected officer may be able to
continue in office under special conditions or enroll in the
FRS as a renewed member (for more on r enezned membership, see
page 62). If you are an elected officer whose DROP term will
conclude before your term of elective office is over, you should
contact the Division's DROP Termination Unit for applicable
termination requirements (see contact information on page 2).
■ K -12 instructional personnel, as defined in s. 1012.01(2)(a)-
(d), F.S., who are employed by district school boards or
developmental research (lab) schools may be permitted to
extend their DROP participation for up to 36 months
37
beyond their initial 60 -month participation period. The
extension must be authorized by the member's employer
and approved by the Division before such an extension
may be granted. Such a DROP participant must remain in
an eligible position throughout the duration of the exten-
sion or his /her DROP is voided.
■ Instructional personnel employed by the Florida School for the
Deaf and the Blind may be permitted to extend their DROP
participation for up to 36 months beyond their initial 60 -month
participation period. The extension must be authorized by the
member's employer and approved by the Division before
such an extension may be granted. Such a DROP participant
must remain in an eligible position throughout the duration of
the extension or his /her DROP is voided.
Frequently Asked Questions
Q 1: Who is eligible to participate in DROP?
A 1: All vested members of the FRS Pension Plan who have
reached their normal retirement date are eligible to parti-
cipate.
Q 2: Who is not eligible to participate in DROP?
A 2: Renewed members of the FRS Pension Plan and participants
of the FRS Investment Plan, the State University System
Optional Retirement Program, the Senior Management
Service Optional Annuity Program, a Community College
Optional Retirement Program, or a local annuity plan are
not eligible for DROP.
Q 3: How soon can I enroll in DROP?
A 3: You may begin program participation in the month you
reach your normal retirement date based upon your age or
in the month following the month you reach your normal
retirement date based upon your years of service. You may
be able to defer your election and enrollment in the pro-
gram to a future time if you meet specified criteria (see
Questions 4 -6).
Q 4: Is there a time limit for enrolling?
A 4: Yes, in most cases, to participate in DROP you must
enroll within your personal "election window." To enroll,
you must notify the Division of your election to partici-
pate and the dates you have chosen to participate, starting
no later than 12 months after you reach your normal retire-
ment date (or deferred participation date). You may apply
for DROP any time in the 6 months before you reach
your normal retirement date (or deferred participation
date). If you fail to notify us within your 12 -month
"election window," you will lose the opportunity to par-
ticipate. However, members who are instructional person-
nel as defined by law and who are reported as such by
their employer (including classroom teachers, employees
in pupil personnel services, librarians /media specialists, and
other instructional staff) may elect to participate in DROP
at any time after reaching their normal retirement date.
Q 5: When will I reach my normal retirement date?
A 5: You reach your normal retirement date as described on
page 44. If you are vested in the Special Risk Class and also
have service in any other class of membership, you may
qualify for DROP under provisions applicable to either
class. You may also choose to include or disregard any
optional service you have purchased, such as refunded
service, leaves of absence, or out -of -state service, when
establishing your normal retirement date for the program.
(Even if you choose to disregard it for purposes of DROP,
any creditable optional service credit you have purchased
will still be included in your benefit calculation.)
39
Q 6: Does my 12 -month DROP election period begin when I
reach my normal retirement date?
A 6: Not necessarily. If you qualify as "instructional personnel"
(see Question 4) you may elect to enroll in the program
at any time after you reach your normal retirement date
and before you retire. If you don't qualify as instructional
personnel, your "election window" opens when you reach
your normal retirement date, finless you are eligible to defer
your election. Once you reach your normal retirement date
(or deferred participation date), you will have 12 months
to elect to participate in DROP (however, at that point, for
every month that you delay application, you lose a month
of potential participation time). You can defer your DROP
election under the following circumstances:
■ If you complete 30 years of service before you reach
age 57, you may defer your program election period to
begin at any time after the date you complete 30 years
of service until the month you reach age 57.
If you reach your normal retirement date while hold-
ing an elective office covered by the Elected Officers'
Class, you may defer your election until your next suc-
ceeding term in the same office and may participate
for up to 60 months, or the length of that term of
office, whichever is less.
If you decide to begin DROP at a later date because you
qualify for a deferral, it is not necessary for you to notify
the Division that you want to defer your participation.
However, to maximize your time in the program, you
must apply timely when your deferral date occurs.
Q 7: How long can I be in DROP?
A 7: In most cases, you may participate in the program for
a maximum of 60 months (assuming that you apply suf-
ficiently early to enter the program timely). If you qualify
as "instructional personnel," you may elect to participate
in DROP for up to 60 months and may also be eligible to
extend your DROP participation for up to another
36 months (see pages 37, 38, and 68).
40
Q 8: What if I don't terminate my job when my DROP par-
ticipation period ends?
A 8: If you fail to terminate employment at the end of your
participation period, your retirement application is voided
and your program participation is retroactively cancelled .6 If
your election window has closed (see Questions 4, 5, and 6),
you would be barred from future participation in this pro-
gram. Your FRS membership and service credit would be
reestablished and your employer would pay (or receive)
any difference that exists between the total contributions
paid and the contributions that would have been paid if you
had never participated in the program. If you still wished to
retire, you would be required to reapply to establish a new
retirement date.
Q 9: Will my DROP money earn interest?
A 9: Yes, while you are in the program, your DROP account earns
interest, compounded monthly at an effective annual rate of
6.5 percent. No interest is earned on benefits on deposit for
less than 1 month or after your DROP participation ends.
Q 10: Will I receive cost -of- living adjustments while in
DROP?
A 10: Yes, your retirement benefits accumulating in your program
account will be increased by a 3% cost -of- living adjustment
each July 1 (your first cost -of- living adjustment will be
adjusted if you have not been in the program for a full year).
Q 11: When and how will my DROP benefits be paid?
A 11: When you terminate employment, you may choose to
receive your program benefits as a lump -sum payment, a
direct rollover to an eligible tax sheltered account as
described in s. 402(c)(8)(B) of the Internal Revenue Code,
or a combined partial lump -sum payment and rollover.
An exception applies in the case of elected officers in DROP (see pages 37 and 45).
41
Q 12: Are FRS in- line -of -duty death benefits payable under
DROP?
A 12: No. Since you effectively retired under the FRS Pension
Plan when you entered DROP, your beneficiary would not
be eligible for in- line -of -duty death benefits. However, your
beneficiary would be eligible to receive all of your DROP
balance as a lump -sum payment, an eligible rollover distribu-
tion to an IRA as described under s. 402(c)(9) of the Internal
Revenue Code, or a combination lump -sum payment and
rollover. And, if you chose option 2, 3, or 4 when you entered
the program, your surviving beneficiary would also receive
monthly FRS benefits according to your option selection.
Q 13: Will I be eligible for disability retirement benefits while
I am in DROP?
A 13: No. Since you effectively retired from the FRS Pension
Plan when you entered DROP, you would not be eligible
for disability retirement benefits if you became disabled
while in the program.
Q 14: Do I receive health insurance subsidy (HIS) benefits
while I participate in DROP?
A 14: No. However, you may be eligible for HIS payments after
your DROP participation ends.
Q 15: Are my DROP benefits (and my future retirement bene-
fits) subject to forfeiture?
A 15: Yes, but only if you have violated the forfeiture provis-
ions of s. 121.091(5)(f) -(j), F.S. (See page 63 ort forfeiture.)
For more information about DROP, you may obtain a program
brochure from your personnel office or the Division's Bureau of
Retirement Calculations. Contact the bureau by telephone at 850/
488 -6491 (SUNCOM 278 - 6491), by FAX at 850/410 -2195 (SUNCOM
210 - 2195), or by e -mail at: calculations@frs.state.fl.us. You may
also download this brochure from the Publications Page of the
Division's website at: www.myflorida.com /frs .
42
RETIRING FROM THE PENSION PLAN
Many issues should be considered as you approach retire-
ment. What retirement income should you expect? Do you
qualify for normal retirement and, if not, should you consider
early retirement? What about the Deferred Retirement Option
Program (DROP)? Once you decide what you want to do, how
and when do you apply?
Estimate of Benefits
Upon request, the Division will calculate an official estimate of
your retirement benefits. We recommend that you request an
estimate from the Division when you are within 5 years of your
anticipated retirement. Unlike the Member Annual Statement
that you receive annually, estimates that you request from the
Division use the retirement date(s) you specify to help you plan
for retirement. Also, if we have calculated the cost to purchase op-
tional service credit, you will receive comparative estimates with
and without this service credit to help you determine if buying the
service credit is beneficial to you.
For an estimate from the Division, you may log on to our website
(www.myflorida.com /frs) to complete an online request. Or, you may
obtain an Information Request, Form FR -9, from your personnel
office, from the Forms Page of the website, or by contacting the
Bureau of Retirement Calculations (see page 1). Once we receive
your request at the Division, your estimate will be calculated and
mailed to you at the address shown on the request form. Or, with
Retirement Online, you can use the Internet to perform unofficial
benefit estimates yourself (including DROP estimates) based on the
retirement ages you assume. (See page 24 for more information.)
43
Normal Retirement
Your normal retirement date is the time you are first eligible to
receive an unreduced retirement benefit based on your age or
years of service (see "Early Retirement "following).
As a Regular Class member you will qualify for normal retirement
when:
• You are vested (see page 15) and are age 62; or
• You have at least 30 years of creditable service, regardless
of your age.
Reference: Sections 121.021(29) and 121.091(1), P.S.
Section 6054.003, F.A.C.
Early Retirement
If you are vested but have not yet reached your normal retirement
date, you may elect to take early retirement. If you do, the amount
of your benefit will be reduced by 5 percent for each year between
your age at retirement and your normal retirement age. Forexample,
if you had at least 6 but less than 30 years of creditable service and
wanted to retire early at age 57, 5 years before you would reach
age 62, your benefit would be reduced by 25 percent (5 years x
5 percent = 25 percent). The 5- percent - per -year reduction for early
retirement is prorated on a month -by -month basis for any period
less than a full year (i.e., 5 /12ths of 1 percent for each month). If
you have 30 years of creditable service, which may include pur-
chased service credit as described on page 28, you can retire at any
age without reduction in your benefit. (Also see "Dual Retirement
Ages" following.)
Reference: Sections 121.021(30) and 121.091(3), F.S.
Section 60S4.005, F.A.C.
44
Dual Retirement Ages
If you have Special Risk Class service and service in another mem-
bership class and have not reached normal retirement age or date for
both classes, a separate benefit must be calculated for each class of
service. The two benefits will be added together for your total benefit.
For example, at age 57 with 25 years of special risk service
and 4 years of regular service, you would receive the full
benefit to which you would be entitled based on your
special risk service and a reduced benefit for your regular
service. This is because you would have reached the
special risk normal retirement age, but not your regular
service normal retirement age. Therefore, the part of your
benefit based on your 4 years of regular service would be
reduced by 25 percent (5 years x 5 percent = 25 percent).
You will qualify for normal retirement under any class other than
the Special Risk Class or Special Risk Administrative Support
Class when:
■ You are vested and reach age 62; or
You have at least 30 years of creditable service, regardless
of your age.
Reference: Section 121.091(2), F.S.
Section 60S- 4.006, F.A.C.
Termination
You must terminate employment to be eligible to receive monthly
benefits. You are considered terminated only after you end all em-
ployment relationships with all FRS employers for 1 calendar month.
You may not work for any FRS employer during the first calendar
month after retirement because to do so would void your retirement.
For example, if your effective retirement date is July 1, you must not
work for any FRS employer during the entire month of July. If you
choose to participate in DROP, the termination requirement would
apply at the end of your program participation, except for members
of the Elected Officers' Class serving a term of office.
Reference: Section 121,021(39), F.S.
Section 60S- 6.001(64), F.A.C.
45
Effective Retirement Date
Your effective retirement date is always the first day of the month
your retirement begins. If the Division receives your application
form before you terminate employment or within 30 days there-
after, your effective retirement date will be the first day of the
month following your termination. If you do not apply within
30 days after termination, your effective retirement date will be the
first day of the month after the Division receives your application,
unless you wish to defer your retirement and specify a later date. If
you choose to participate in DROP, your effective retirement date
would coincide with your program participation date (the first
day of the month you select to begin DROP participation).
Reference: Section 121.091, F.S.
Section 60S- 4.0035(3), F.A.C.
Application for Benefits
You must apply for retirement benefits before you can begin
receiving benefit payments. To apply, complete Form FR -11,
Application for Service Retirement. (This form is available from
your personnel office, from the Division, or from the Forms Page
of the Division's website at www.myflorida.com /frs.)
The earliest you may apply for retirement is 6 months before your
planned retirement date. In addition to an application, you must
submit proof of age as outlined on page 50. The Division will
acknowledge receipt of your application form and advise you of
anything else needed. If you are buying additional service credit,
the Division must receive your final payment before you can begin
receiving benefits. Retirement benefits are paid on the last workday
of each month after your name is added to the retired payroll.
You may change any item on your application before retirement.
However, once a benefit payment has been cashed or deposited, your
retirement is final and you cannot change your option or add ser-
vice credit. Also, you caruzot change your type of retirement (early,
regular, or disability) except when you recover from disability.
Reference: Section 121.091, F.S.
Sections 60S- 4.002(4), 4.0035(1), and 4.010(5), F.A.C.
.e
Benefit Payment Options
When you retire, you must choose one of the four benefit options
(methods of payment) available to you. You will not begin receiv-
ing your retirement benefits until you have selected a benefit
option. Once you cash or deposit a benefit payment, your option
selection cannot be changed.
If you are married and you select option 1 or 2, your spouse must
acknowledge your option selection in writing. If you select
option 2, 3, or 4, your benefit will be actuarially reduced from the
option 1 amount. However, the total benefit provided under each
of these options is actuarially equal to what you alone would be
expected to receive under option 1.
Options 1 and 2
Option 1: Provides a monthly benefit payment to you for your
lifetime. Option 1 does not provide a continuing bene-
fit to a beneficiary. Upon your death, the monthly
benefit will stop and your beneficiary is entitled to
receive only a refund of contributions you paid, if any,
which exceed the amount you received in benefits. If
you wish to provide a beneficiary with a continuing
benefit after your death, you should consider selecting
one of the other three options.
Option 2: Provides a reduced monthly benefit payment to you for
your lifetime. If you die 10 years or more after retirement,
no benefits are payable to your beneficiary. However,
if you die within 10 years (120 months) of retiring,
your beneficiary will receive a monthly benefit payment
in the same amount you were receiving for the balance
of the 120 -month period (including any period of DROP
participation). No further benefits are then payable.
47
Options 3 and 4
Under Options 3 and 4, you may provide a continuing benefit
to your spouse or other dependent beneficiary who is your joint
annuitant as described below. To qualify as a joint annuitant, an
individual must be:
■ Your spouse; or
• Your parent or grandparent, as long as you are providing at
least one -half of his or her financial support; or
• Your natural or legally adopted child who is either under
age 25 or physically or mentally disabled and incapable of
self- support; or
' A person for whom you are the legal guardian, as long as you
provide at least one -half of his or her financial support.
Option 3: Provides a reduced monthly benefit payment to you for
your lifetime and a continuing benefit to your surviving
joint annuitant. No further benefits are payable after both
you and your joint annuitant die. Upon your death:
If your joint annuitant is your spouse, your parent or
grandparent, or someone age 25 or older for whom
you are the legal guardian, he or she will receive
a lifetime monthly benefit payment in the same
amount as you were receiving.
■ If your joint annuitant is your natural or legally adopted
child (or someone for whom you are the legal guardian)
who is under age 25 at the tune of your death, he or she
will receive a benefit payment in the amount of your
option 1 benefit until he or she reaches age 25.
If your joint annuitant is your natural or legally
adopted child (or person for whom you are the legal
guardian) who is physically or mentally disabled
and incapable of self- support at the time of your
death, regardless of age, he or she will receive a ben-
efit payment in the amount of your option 1 benefit
until he or she is no longer disabled.
Option 4: Provides an adjusted monthly benefit payment to you
while both you and your joint annuitant are living and a
reduced continuing benefit to the survivor. No further
option 4 benefits are payable after both you and your
joint annuitant die.
If your joint annuitant dies first, your benefit is re-
duced to two- thirds of the monthly benefit paid when
you both were living.
In the event that you die first:
If your joint annuitant is your spouse, your parent
or grandparent, or someone age 25 or older for
whom you are the legal guardian, he or she will
receive a lifetime monthly benefit payment equal
to two- thirds of the monthly benefit paid when
you both were living; or
If your joint annuitant is your natural or legally
adopted child (or person for whom you are the
legal guardian) who is under age 25 at the time of
your death, he or she will receive a benefit payment
in the amount of your option 1 benefit until he or
she reaches age 25; or
If your joint annuitant is your natural or legally
adopted child (or person for whom you are the
legal guardian) who is physically or mentally dis-
abled and incapable of self- support at the time of
your death, regardless of age, he or she will receive
a benefit payment in the amount of your option 1
benefit until he or she is no longer disabled.
Reference: Section 121.091, F.S.
Sections 60S-4.002(4),4.0035(l), and 4.010(5), F.A.C.
49
Proof of Age
When you apply for retirement, you must furnish proof of your
age. If you choose benefit payment option 3 or 4, you must also
furnish proof of age for your joint annuitant. The Division must
receive the required proof of age before you can begin receiving
benefits. We will accept a readable copy of one of the following
documents:
■ Birth certificate
■ Delayed birth certificate
■ Census report more than 30 years old
■ Life insurance policy more than 30 years old
■ Documentation from the Social Security Administration
stating the date of birth it has established for payment of
benefits to you or your joint annuitant
• Certificate of naturalization
If you can't furnish any document listed above, a readable copy of a
document from two of the following categories will be required:
■ Birth certificate of your child, giving your age or your
joint annuitant's age, as appropriate
■ Baptismal certificate more than 30 years old
■ Hospital record of birth
• School record at the time you (or your joint annuitant)
entered grammar school
Reference: Section 121.091, F.S.
Section 60S- 4.0035(2), F.A.C.
50
Limitation of Benefits
State and federal laws may limit the amount of your annual benefit
as explained below:
Florida Retirement System Maximums - Under state law,
your initial retirement benefit under the FRS Pension Plan may
not exceed 100 percent of your average final compensation.
However, this restriction doesn't apply to pension increases
resulting from cost -of- living adjustments, nor does it apply to
benefits accruing in individual accounts under the FRS Invest-
ment Plan (Public Employee Optional Retirement Program)
established under part II of chapter 121, F.S.
Federal Maximums - Since 1974, under section 415 of the
Internal Revenue Code, the federal government has limited
the amount of annual retirement benefits you can receive.
In 1998, Congress enacted legislation to permit government
entities to establish excess benefit plans for people who are
adversely affected by this federal limit (similar to excess ben-
efit plans already in effect for private employers). As a result,
the 1999 Florida Legislature adopted the Florida Retirement
System Preservation of Benefits Plan (an excess benefit plan)
to effectively offset the impact of the federal limit on retirees
of the FRS Pension Plan. This plan, which became effective
on July 1, 1999, requires the Division to pay each affected
retiree, by separate check, an amount equal to any reduction
in benefits imposed by the federal limit. Therefore, if you are
affected by this federal limit, you will be "made whole' by
the excess benefit plan and you will not suffer a reduction in
benefits. This maximum is adjusted for age so that retirees
younger than age 62 have a lower maximum and those older
than age 65 have a higher maximum.
51
Section 401(a)(17) of the Internal Revenue Code also limits
the amount of salary on which contributions can be paid into
a retirement plan. If you became a member on or after July 1,
1996, and effective with the 2004 -2005 fiscal year you make over
$205,000, no credit will be awarded, and no contributions will be
paid by your employer, on salary over that amount; however, if
you became a member before July 1, 1996, the limit is $306,820.
FRS Benefits /Contributions Are Primary - If you participate in
any retirement plan maintained by your employer in addition
to the FRS and Social Security, including a qualified pension
plan, a qualified employee annuity plan, or a 403(b) annuity,
federal limits may apply to the combined amount of benefits
payable under all plans except Social Security. If the combined
amount exceeds a federal limit, the benefits payable under the
other plan(s) must be reduced first to conform to the limit.
Benefits provided under the FRS Pension Plan are considered
primary to benefits provided under any other plan. Separate
limits apply to contributions made under defined contribution
plans, such as the FRS Investment Plan.
Reference: Sections 121.091(11) and 121.30(5), F.S.
Section 60S- 4.002(3), F.A.C.
52
DISABILITY BENEFITS
The Florida Retirement System (FRS) provides disability cover -
age in order to afford income to eligible members of the FRS
Pension Plan and the FRS Investment Plan who become totally
and permanently disabled and are unable to work. Your injury or
illness must have occurred before you terminated employment or
joined the Deferred Retirement Option Program (DROP). If you
are a Pension Plan or Investment Plan retiree with renewed
membership (see page 62), or if you are in DROP (seepage 3 7),
you are not eligible for disability benefits. Disability benefits are
not reduced for early retirement. Two types of disability benefits
are payable:
Regular Disability Benefits
As of July 1, 2001, to qualify for regular disability retirement, you
must complete at least 8 years of creditable service, regardless of
the other vesting requirements for your membership class or plan.
If your disability retirement is approved, your option 1 annual
benefit will be at least 25 percent of your average final compen-
sation. If your actual earned benefit based on your years of
service would be higher than the 25 percent minimum regular
disability benefit, the higher benefit amount would be paid.
In- Line -of -Duty Disability Benefits
You are covered for in- line -of -duty disability from your first day
of covered employment. If you believe the illness or injury that
caused your total and permanent disability arose out of and dur-
ing the actual performance of your duties as required by your
employer, you may apply for in- line -of -duty disability retirement
benefits. As a member of the Regular Class, the minimum yearly
benefit paid under option 1 for this type of disability is 42 percent
of your average final compensation. If your actual earned bene-
fit, based on your years of service, would be higher than the
42 percent minimum disability benefit, the higher benefit amount
will be paid.
53
For specified professions and diseases, the disability may be
presumed to have occurred in the line of duty. This special pre-
sumption is available for:
■ Firefighters, law enforcement officers, and correctional
officers disabled due to tuberculosis, heart disease or
hypertension, hepatitis, or meningococal meningitis.
■ Paramedics and emergency medical technicians disabled
due to hepatitis, meningococcal meningitis, or tuberculosis.
For more information regarding disability retirement benefits
under the FRS Pension Plan and the FRS Investment Plan, you may
download a copy of the Disabilitj Benefits Member Guide from the
Division's website or obtain a copy from your personnel office
or from the Division's Research and Education Section. If you
have further questions, please call the Disability Determination
Section. (For contact information, see page 2.)
Reference: Sections 121.091(4) and (6),112.18, and 112.181, F.S.
Section 60S- 4.007, F.A.C.
SURVIVOR BENEFITS
Regular Survivor Benefits
If your death occurs other than in the line of duty and before you
are vested, your designated beneficiary will be eligible to receive
only a refund of any personal retirement contributions you made to
the system. However, if your beneficiary qualifies as a joint annui-
tant and you are within 1 year of vesting at the time of your death,
your joint annuitant may be eligible to purchase enough service
credit to "vest" you after your death. This service credit would be
based upon your accumulated leave balances and /or any in -state
or out -of -state service you were eligible to purchase.
If you first became a member of the FRS after employee contri-
butions were eliminated for most members in 1975, all contri-
butions paid into the system have been paid on your behalf by
54
your employer. These contributions are not refundable, so there
would probably not be any refund payable to your beneficiary.
If your death occurs other than in the line of duty after you are
vested, but before you retire, and your designated beneficiary
does not qualify as a joint annuitant, he/she could only receive
a refund of your personal retirement contributions, if any (no
monthly benefit would be payable). However, if your designated
beneficiary qualifies as a joint annuitant, he or she may choose
one of the following:
■ A refund of your personal retirement contributions, if any.
■ A lifetime monthly benefit calculated as though you had
retired on your date of death and chosen an option 3 benefit
payout (this benefit would be adjusted for early retirement
if you died before reaching your normal retirement date).
However, if your joint annuitant is your natural or legally
adopted child, or other person for whom you are the legal
guardian, who is under age 25 or is disabled and incapable
of self - support, the benefit paid will be your option 1 ben-
efit amount and your beneficiary will receive this benefit
until he or she reaches age 25, or until he or she is no longer
disabled. (For an explanation of benefit options, see page 47.)
• An option 3 benefit deferred to a future date and based on
your age if you had lived to the date the benefit begins. If
you die before reaching your normal retirement date and
have less than 20 years of service, a deferred benefit
would be higher for your beneficiary than an immediate
benefit. This is because there is less of an early retirement
reduction as a member approaches normal retirement age.
Therefore, your beneficiary's benefit would be higher the
closer your age would be to the normal retirement age for
your membership class at the time the benefit begins.
• If you die before reaching your normal retirement date
while employed with an FRS employer and have at least
20 years of creditable service, your benefit may be re-
duced from 30 years rather than normal retirement age if
this will provide a higher benefit.
55
In- Line -of -Duty Survivor Benefits
All FRS Pension Plan members are covered from their first day of
employment for in- line -of -duty death survivor benefits. If your
death arises out of and in the actual performance of the required
duties of your job while you are employed in a covered position
under the FRS Pension Plan, your surviving spouse will be eligible
to receive all benefits due, even if you named someone else as your
beneficiary. Your spouse is entitled to a lifetime monthly benefit
equal to one -half of your last monthly salary, regardless of your
length of service. If you have a dependent child or children at the
time of your death, but are not married, or your spouse dies later,
the benefit will be paid on behalf of your unmarried children
until the youngest child reaches age 18.
After you retire, if you return to covered employment and become
a renewed member, your surviving spouse and dependent children
would be eligible for in- line -of -duty death survivor benefits.
Certain FRS members may be entitled to a presumption that their
death from specified diseases occurred in the line of duty. (See "In-
Line -of -Duty Disability Benefits" on page 53 for more information.)
MOTE: If you are participating in the Deferred Retirement Option Program
(DROP), you are considered retired, so your surviving spouse and
dependent children are not eligible for in- line -of -duty survivor bene-
fits. For more information on these subjects, request a copy of the
booklet titled SLirvivor Benefits of the Florida Retirement Systetn and the
DROP brochure.
For more information regarding survivor benefits under the FRS
Pension Plan, you may download a copy of the Survivor Benefits
Member Guide from the Divisions website or obtain a copy from
your personnel office or from the Division's Research and Edu-
cation Section. If you have further questions, please call the Survi-
vor Benefits Section. (For contact information, see page 2.)
Reference: Sections 121.021(28) and 121.091(3), (5), (6), and (7), F.S.
Sections 605- 4.005, 4.008, and 4.009, F.A.C.
56
AFTER RETIREMENT
Cost -of- Living Increase
Florida law provides FRS Pension Plan retirees (including DROP
participants) with an annual 3 percent cost -of -living increase, effective
July 1 of each year. The increase will be included in the check you re-
ceive at the end of each July. The increase is calculated on the amount
of your June benefit, excluding any health insurance subsidy payment
you may receive. If you have not been retired for a full year, your
first cost -of -living increase will be prorated based on the number of
months you have been retired as of July 1. (For example, if you retired
on January 1, your first cost -of -living increase would be 1.5 percent of
your benefit, based on 6 months of retirement.)
Reference: Section 121.101(3), F.S.
Section 60S- 4.013, F.A.C.
Health Insurance Subsidy (HIS)
Most retirees with health insurance coverage (which may include
Medicare or Tricare) are eligible for a monthly supplemental pay-
ment to help pay for this insurance. The amount of the health
insurance subsidy (HIS) is based on your service credit at retire-
ment ($5 for each year of service) and is included with your
monthly benefit payment. The minimum monthly subsidy is $30
(if you retire with 6 years of service credit') and the maximum
monthly subsidy is $150 (if you retire with 30 or more years
of service credit). The HIS certification form is available from the
Division and is automatically mailed to benefit recipients after their
names have been added to the retired payroll to begin receiving
monthly benefits. The eligible retiree (or joint annuitant, if the
member is deceased) is responsible for applying for the HIS.
Retirees in DROP are not eligible to receive HIS payments until
their program participation ends.
Reference: Section 112.363, F.S.
Section 60S- 4.020, F.A.C.
' The joint annuitants of members who die in the line of duty with less than
6 years of service may still be eligible for the subsidy.
57
Insurance Coverage after Retirement
Under state law, Florida public employers that provide group
health insurance plans for active employees must offer their retir-
ing employees the opportunity to continue participating in these
group plans. The cost of health and hospitalization insurance
premiums paid by a retiree cannot exceed the total (employee
and employer) premium cost applicable to an active employee.
If you do not elect to continue participating in your employer's
group plan at retirement, if you initially elect to continue but
subsequently discontinue your participation, or if you defer your
retirement to a future date, you may lose eligibility to participate
in the group plan in the future.
The Division of Retirement has no authority over or responsibility
for these plans. You should discuss this provision with your
employer when preparing to retire.
Reference: Sections 110.123 and 112.0801, F.S.
Reemployment after Retirement
After you retire under the FRS, you can work for any private
employer, for any public employer not participating in the FRS,
or for any employer in another state, without affecting your FRS
benefits. However, subject to the exceptions described below, if
you are reemployed in your first year of retirement by an employer
participating in the FRS, the following limitations apply:
You must terminate employment (be off payroll with all
FRS employers for 1 calendar month) to retire from the
FRS. If you return to work for a participating employer
during the first month of your retirement, you will void
your retirement and your FRS membership will be reestab-
lished. All retirement benefits must be repaid and you must
reapply for retirement, establishing a later effective date of
retirement.
■ Similarly, if you were employed by a participating employer
during the first month after ending your participation in
DROP, both your retirement and DROP status would be
voided. An exception applies in the case of elected officers in
DROP (see page 45 on termination).
• For 12 months after your effective date of retirement, as an
FRS retiree, you cannot earn a salary from any participating
employer while drawing retirement benefits from the sys-
tem. If you work for a participating employer during the 2nd
through 12th months after your effective retirement date, you
must inform the Division. Except as otherwise noted below,
for any months you work during this limitation period, you
will forfeit the right to receive benefits (the Division will
suspend your benefits and you must repay any such benefits
inappropriately received). After the first 12 months of retire-
ment, there are no further reemployment limitations.
• If you are in DROP, you will be subject to reemployment
limitations described above as soon as your period of
DROP participation ends.
Exceptions to the Reemployment Law
If you retire from the FRS and you become reemployed in any of
the following positions in your first year of retirement, you may
be exempt from the reemployment limitations, or you may be
otherwise eligible for a limited exception, as follows:
• A member who retires or ends DROP participation and is
serving in elective office or is elected, reelected, or appointed
to an elective office is subject to different termination re-
quirements and is exempt from reemployment limitations
during the 2nd through 12th months after termination (see
pages 37 and 45 on termination of elected officers).
• A retired justice or judge on temporary assignment to
active judicial service pursuant to Article V of the State Con-
stitution is exempt from reemployment limitations after
being retired for 1 calendar month. Such justices or judges
are not eligible for renewed membership.
59
After being retired for 1 calendar month, you may be
reemployed in certain positions without further limita-
tion during the 2nd through 12th months after retirement.
The excepted positions are:
District School Boards — FRS and TRS retirees may be re-
employed without limitation as classroom teachers on
an annual contractual basis. Additionally, noncontract-
ual employment is allowed without further limitation
after the first calendar month of retirement for FRS
retirees only who are hired as education paraprofes-
sionals, transportation aides, bus drivers, or food
service workers.
Florida School for the Deaf and the Blind —FRS and TRS
retirees may be reemployed on an annual contractual
basis as classroom teachers or as substitute or hourly
teachers on a noncontractual basis, without limitation.
(Residential instructors are included in the category of
noncontractual substitute or hourly teacher.)
Charter Schools — FRS and TRS retirees may be reem-
ployed as classroom teachers on an annual contractual
basis or as substitute or hourly teachers on a non -
contractual basis, without limitation.
Developmental Research Schools (Universihj Lab Schools) —
FRS and TRS retirees may be reemployed on an
annual contractual basis as classroom teachers or as
substitute or hourly teachers on a noncontractual basis,
without limitation.
Me
■ After being retired for 1 calendar month, you may be re-
employed in certain positions for up to 780 hours during
the 2nd through 12th months after your effective retirement
date. The positions eligible for a limited exception to reem-
ployment limitations are:
■ Community Colleges—FRS and TRS retirees may be
reemployed as part -time, noncontractual adjunct in-
structors or phased retirement program participants for
up to 780 hours during the 2nd through 12th months
of retirement.
Universities —FRS and TRS retirees may be reemployed
as adjunct faculty or phased retirement program partici-
pants with the State University System for up to 780 hours
during the 2nd through 12th months of retirement.
Firefighters or paramedics —FRS retirees may be reem-
ployed as firefighters or paramedics serving in temporary
or regularly established positions for up to 780 hours dur-
ing the 2nd through 12th months of retirement.
Any affected reemployed retiree who is not eligible for an ex-
ception or will exceed his /her 780 -hour limitation should notify
the Bureau of Retirement Calculations (see page 1).
Reference: Sections 121.091(9) and 1012.01(2)(a) -(d), F.S.
Section 60S- 4.012, F.A.C.
Reemployment of Disabled Members
Under Florida law, an FRS member cannot receive FRS disability
benefits while he /she is gainfully employed. If a disability retiree
returns to any type of employment with any type of employer,
public or private, the Disability Determination Section must be
notified (see page 2) in order to avoid overpayment of benefits.
Upon reemployment, disability benefits will be terminated.
Reference: Section 121.091(4)(h), F.S.
61
Renewing Membership after Retirement
Retirees of the FRS Pension Plan or the FRS Investment Plan who
are reemployed in covered employment will renew their member-
ship in the FRS Pension Plan and earn service credit toward a
"second- career" retirement benefit for which they will qualify
upon vesting again. (Renewed members may alternatively elect
to participate in the FRS Investment Plan.) With rare exception,
retirees who participate in DROP are eligible for renewed mem-
bership only after they have terminated employment upon com-
pleting their period of program participation. Renewed members
who retire again, including former DROP participants, are once
more subject to reemployment limitations, unless they are eligible
for exceptions, as described on pages 59 -61.
Renewed members are ineligible to participate in DROP, and are
not eligible for disability benefits. However, the surviving spouse
and dependent children of a renewed member may qualify for survi-
vor benefits (for details, contact the Survivor Benefits Section; see page 2).
Reference: Sections 121.053,121.091(9),121.122, and 238.181, F.S.
Sections 60S- 1.0045 and 4.012, F.A.C.
Minimum Benefit Adjustment
The Division automatically identifies any eligible retiree of the FRS
Pension Plan whose retirement benefit is below a certain level
and will increase the benefit to a minimum amount when the
retiree reaches age 65 and 1 month.
Reference: Section 112.362, F.S.
Section 60S- 4.0025, F.A.C.
62
GENERAL INFORMATION
Appeals Procedure
If the Division makes a decision that will reduce, suspend or
terminate your retirement benefits, you may petition the Division
for a hearing. Rule 28- 106.201 of the Florida Administrative Code
outlines the requirements for filing a petition. After the Division
reviews your petition, the State Retirement Director may ask
a hearing officer from the Division of Administrative Hearings to
conduct the hearing, or in some cases the General Counsel's
Office of the Department of Management Services may conduct
the hearing. If the outcome is not in your favor, you will be
informed of the time period during which you can appeal the
hearing officer's decision to the District Court of Appeal.
Reference: Section 120.57, F.S.
Sections 28- 106.201 and 60S- 4.002(8), F.A.C.
Forfeiture of Benefits
If, before retirement, you commit a crime as specified in
s. 121.091(5) or s. 112.3173, F.S., and you are found guilty of the
crime or enter a plea of "no contest" with respect to the crime,
or your employment is terminated because you admit to com-
mitting, aiding, or abetting such a crime, you will forfeit all your
retirement rights and benefits (except for a refund of your personal
retirement contributions, if any). You must forfeit your retire-
ment benefits only if the offense committed in connection with
your FRS - covered employment is a job - related felony offense
as outlined below:
Committing, aiding, or abetting embezzlement of public
funds or any grand theft from your employer;
• Committing bribery in connection with your employment;
• Committing any other felony specified in chapter 838, F.S.
(bribery and misuse of public office), except ss. 838.15 and
838.16, F.S. (commercial bribes);
63
■ Committing any felony with intent to defraud the public
or your employer of the right to receive your faithful per-
formance of duty, or receiving or attempting to receive
profit or advantage for yourself or another person through
the use of your position; or
• Committing an impeachable offense (applies to elected of-
ficials only).
In addition, if a court of competent jurisdiction determines that you
violated any state law against strikes by public employees, you will
also forfeit your benefits (except for your personal contributions).
If your beneficiary is found guilty of intentionally killing you
or procuring your death, he or she will forfeit all rights to any
survivor benefits otherwise payable on your behalf. Any benefits
payable would be paid as if your beneficiary died before you.
The Clerk of the Court, the Secretary of the Senate or your em-
ployer, as appropriate, must notify the Commission on Ethics
(and may notify the Division) if you are found guilty of, or you are
impeached or terminated for, any of the offenses listed above. The
Commission on Ethics will notify the Division. Your benefits will
be suspended, subject to a hearing held by a hearing officer of the
Division of Administrative Hearings. You may appeal the hearing
officer's decision to the District Court of Appeal.
For more information on the forfeiture of benefits, please call the
Division's Legal Section at 850/487 -1230 or SUNCOM 277 -1230.
Reference: Sections 112.3173 and 121.091(5), F.S.
Section 605- ,4.021, F.A.C.
Assignment, Execution, or Attachment
Your retirement benefits and accumulated contributions accrued
under the FRS are not subject to assignment, execution, attachment,
or any other legal process with the exception of qualified domestic
relations orders, certain income deduction orders (s. 61.1301, F.S.),
and federal income tax levies.
Reference: Sections 121.131 and 222.21, F.S.
Section 60S- 4.014, F.A.C.
64
FINANCIAL AND ACTUARIAL INFORMATION
Each year the Division prepares an annual report for the Legis-
lature on the financial condition of the FRS Pension Plan.
Highlights of the annual report for the fiscal year ending June 30,
2004, and of the 2003/04 actuarial valuation (valuations are per-
formed annually) are summarized and presented below for your
information. For additional information, please see the 2003/2004
FRS Annual Report.
Fund Market Value: $117,429,497,291
65
Growth of FRS Trust Fund Assets
at Market Value
1995 -2004
$140
$120
$117,689 $117,430
$108,990
$106,890
$100
$103,458 $102,688
$80
$92,182
$74,866
�
O
r^,
$60
�-+
$50,783
$40
$41,740
$20
$0
95
96 97 98 99 00 01 02 03 04
Fiscal Year
65
Distribution of FRS Trust Fund Investments
as of June 30, 2004
20.20%
4.00%
3.40% 0.70%
o�m
® Domestic Equities
International Equities
® Global Equities
❑ Fixed Income
Real Estate
Alternative Investments
® Cash & Short Term
History of Unftmded Actuarial Liability
1985-2004
$ 25.0
$ 20.0 $14.3
$ 15.0 $10.6 _-+--
$ 10.0 r
$ 5.0-$7.4
Fq $ 0.0
-$5.0-
-$ 10.0
$ 15.0
$ 20.0
$
25.0---T-
85
^� $14.0 $12.4
$15.9
$5.4 "
-$3.8 L)
-$9.2
- $14.5
10 nb
87 89 91 93 95 97 99 01 03
Fiscal Year
M
Comparison of Actuarial Peviews
of the Florida Retiremei# System
'Includes DROP Liability
67
200
2003
2004
Membership
611,178
595,164
597,376
Annualized Payroll (billions)
$20.1
$20.75
$21.59
Average Annual Earnings
$33,9
6
$35,062
$36,137
DROP Participants
28,3
9
26,720
28,654
Number of Annuitants
198,0
4
208,399
224,538
Annual Benefits Paid (millions)*
$3,0
8
$3,903
$3,666
Total Liabilities (billions)
$8
5
$89.3
$95.2
Trust Assets (billions)
$9
4
$101.9
$106.7
Unfunded Liability (billions)
-$12.9
-$12.6
-$11.5
Unfunded Liability as a % of
Total Liabilities
-15
YO
-14%
-12%
Assets as a % of Total Liabilities
115
0
114%
112%
'Includes DROP Liability
67
LEGISLATIVE UPDATE
In 2003 and 2004, the Florida Legislature made changes to laws
affecting FRS members. Major enactments since the last edition of
this publication are described below.
Contribution Rates
Employer contribution rates were adjusted effective July 1, 2004,
and the system of uniform, blended rates established in 2002 was
maintained for the FRS Pension Plan and the FRS Investment Plan
(see page 10).
Deferred Retirement Option Program (DROP)
As of June 1, 2003, certain K -12 instructional personnel employed
with a district school board or by the Florida School for the Deaf
and the Blind are allowed to extend their DROP participation beyond
60 months, for up to an additional 36 months. To qualify for the exten-
sion, the DROP participant must receive authorization from the Div-
ision and from the district school superintendent or from the Board of
Trustees of the School for the Deaf and the Blind, as appropriate.
Eligible K -12 instructional personnel include:
■ Classroom teachers;
• Student personnel services staff (guidance counselors,
social workers and school psychologists);
• Librarians and media specialists; and
• Other instructional staff (primary specialists, learning re-
source specialists, instructional trainers, adjunct educa-
tors, and similar positions).
Effective June 23, 2004, DROP participants who are employed by
developtnental research schools (university lab schools) as instruc-
tionaI personnel (see above) are also eligible to extend their DROP
participation for up to an additional 36 months beyond the initial
60 months, if the extension is authorized by the school's director (or
principal if there is no director) and approved by the Division.
.:
As is the case for employees of district school boards or the
Florida School for the Deaf and the Blind, a DROP participant
employed by a developmental research school must be in an eli-
gible position at the end of his /her initial DROP period in order to
be found eligible for a DROP extension. Such a DROP participant
must remain in an.eligible position throughout the duration of the
extension or DROP is voided.
For more information about extended DROP participation, you
may download a copy of the DROP brochure from our website, or
you may request a copy by contacting the Research and Education
Section (see page 2). Or, telephone the Bureau of Retirement Calcu-
lations to speak with a Benefits Specialist (see page 1).
Reemployment after Retirement
In 2003, the Florida Legislature amended FRS retirement laws to
allow FRS retirees to return to work in certain eligible positions for
a district school board after 1 calendar month of retirement (or after
1. calendar month following conclusion of DROP) and simultaneously
receive both salary and benefits without further limitation. In 2004,
the Legislature expanded this provision to retroactively provide the
same authority for TRS retirees hired by district school boards, and
to provide similar future authority for FRS and TRS retirees hired
by the Florida School for the Deaf and the Blind, developmental
research schools (university lab schools), and charter schools.
NOTE: Please remember, if you are a retiree, you should always contact the
Bureau of .Retirement Calculations before you are reemployed in any
capacity with any FRS employer in your first year of retirement.
Do not put your retirement benefits in jeopardy unnecessarily. (See
contact information on page 1.)
In brief, under the laws in effect at publication, after 1 calendar
month of retirement:
■ Effective July 1., 2003, an FRS or TRS retiree may, without
further limitation, be reemployed by a district school board
on an annual contractual basis as a K -12 classroom teacher.
Any FRS or TRS retiree may also be reemployed on a non -
contractual basis as a substitute or hourly teacher. Finally, an
FRS retiree may be reemployed on a noncontractual basis as
69
an education paraprofessional, transportation assistant, bus
driver, or food service worker.
• Effective June 23, 2004, an FRS or TRS retiree may, with-
out further limitation, be reemployed by the Florida School
for the Deaf and the Blind as a contractual classroom
teacher or a noncontractual hourly or substitute teacher.
(Residential instructors are included in the category of non -
contractual substitute or hourly teacher.)
• Effective June 23, 2004, an FRS or TRS retiree may, without
further limitation, be reemployed by a developmental research
school (university lab school) as a contractual classroom
teacher or a noncontractual hourly or substitute teacher.
• Beginning July 1, 2004, FRS or TRS retirees may, without
further limitation, be reemployed by a charter school as
a noncontractual substitute or hourly teacher, or as a con-
tractual classroom teacher.
Any FRS or TRS retiree filling a regularly established position as
described above will become a renewed member upon reemploy-
ment. If you are affected, your benefits need not be suspended,
regardless of the number of hours you work. However, if at any
time during your 2nd through 12th months of retirement you are
employed by an FRS employer in an ineligible position, you
must notify the Division and your retirement benefits will be
suspended. For any months you work in an ineligible position
during this limitation period, you will forfeit your benefits (and are
required to repay any such benefits inappropriately received).
Special Window to Buy Additional Service Credit
For 1 year only (from July 1, 2003, through June 30, 2004), FRS
Pension Plan members were authorized to buy additional service
credit for their eligible out -of -state or in -state service.
To buy more than 5 years of service credit, total, members had to
both certify their eligibility and pay in full for the service credit by
June 30, 2004. On July 1, 2004, the law reverted to the aggregate
limit of 5 years, regardless of the type of credit bought.
70
Repeal of Mentor Teacher Pilot Program
On July 1, 2003, the Florida Legislature abolished the Florida
Mentor Teacher Pilot Program. Therefore, only those program
payments made between July 1, 2002, and June 30, 2003, and
reported as compensation earned in that period will be treated as
compensation for retirement purposes.
Community College Optional Retirement Program
The Legislature has revised provisions affecting the Community
College Optional Retirement Program ( CCORP). Effective July 1,
2003, for community colleges that offer a CCORP, the program's
plan structure was modified to:
• Allow the acceptance of rollovers into participant accounts;
• Expand benefit payment and distribution options under
the program;
• Expand the CCORP elective enrollment period from
60 days to 90 days from the date of hire;
• Provide for retroactive CCORP effective dates (either
effective on the date of hire or effective on the first day of
the first full month of eligibility, as appropriate); and
• Require community college boards of trustees, rather than
colleges, to approve program administrative fees.
Effective July 1, 2003, all CCORP participants were given one op-
portunity, at the employees' discretion, to transfer from the CCORP
either to the FRS Pension Plan or to the FRS Investment Plan. Also,
those CCORP participants who enrolled in CCORP before July 1,
2003, were authorized to elect to transfer from the FRS Trust Fund to
their CCORP account a sum representing the present value of up to
60 days of service credit (credit earned under the FRS Pension Plan
between the date the member first became eligible for CCORP and
the date of transfer to CCORP). Upon transfer of this value to the
CCORP account, any associated credit under the FRS Pension Plan
is nullified.
71
FRS Investment Plan
Several changes, summarized below, were made to the Public
Employee Optional Retirement Program (FRS Investment Plan).
Effective July 1, 2004:
• The spouse at the time of the member's death will be the
beneficiary for the Health Insurance Subsidy (HIS) Pro-
gram benefit unless the member names a different benefi-
ciary after his /her most recent marriage.
• "Retiree' is defined as a member who terminates employ-
ment and takes a distribution (other than a mandatory
distribution of a de minimis account balance).
• The State Board of Administration (SBA) and the Depart-
ment of Management Services (DMS), as appropriate,
are authorized to cash out a de minimis account of an
FRS Investment Plan member who is terminated from
FRS - covered employment for a minimum of 6 calendar
months. A "de minimis" account is defined as one that
contains not more than $5,000 in employer contributions
and accumulated earnings.
• For disability retirements on or after July 1, 2004, remaining
account balances, if any, are not returned to the beneficiary
of a deceased disabled FRS Investment Plan member.
• Employers must reimburse FRS Investment Plan members
for market losses to accounts due to contribution adjust-
ments that result from employer error or correction. Also,
a participant who takes a distribution must return any
excess contributions received in error, adjusted for market
gains or losses before distribution. The SBA or its des-
ignated agent must communicate this obligation to mem-
bers, but the SBA, its designated agents, the PEORP Trust
Fund, the DMS, and the FRS Trust Fund are held harmless
for any loss or gain that may result from the correction.
72
Pension and Investment Plan Membership Elections
Effective July 1, 2004, FRS plan choice procedures were modified.
In brief, the legislation:
• Conforms election periods for the Pension Plan and the
Investment Plan (employees will have until the end of the
5th month following the date of employment or the end of
a leave of absence to make a plan election). Any employee
who fails to make a plan election within the election
period becomes a default member of the FRS Pension Plan
effective on the last business day of the 5th month following
the date of employment or the end of a leave of absence.
• Allows any FRS member to exercise his /her "second
chance" election to choose to participate in either the Pen-
sion Plan or Investment Plan as early as the month after
the initial election becomes effective.
Forfeiture
Under Florida law, members of publicly funded retirement plans who
commit certain employment- related crimes before retirement, or aid
in the commission of such crimes, must forfeit their entitlement to
future retirement benefits. Crimes for which forfeiture is required
include the commission of any felony under chapter 838, F.S.
On October 1, 2003, chapter 838 was amended to increase the
penalties for, and change the number and nature of, offenses that
could ultimately lead to required forfeiture. Potentially affected
crimes include: Bribery; unlawful compensation or reward for
official behavior; corruption by threat against a public servant; of-
ficial misconduct; disclosure or use of confidential criminal justice
information; and bid tampering.
73
GLOSSARY OF RETIREMENT TERMS
The following terms are defined as used in connection with the
FRS. If these terms appear elsewhere in this booklet, they are
underlined the first time they appear.
In an effort to make these provisions easy to understand,
this glossary has been written using nontechnical language as much
as possible. If questions of interpretation arise as a result,
chapter 121 of the Florida Statutes and any applicable rules of
the Florida Administrative Code must remain the final authority.
Retirement terms relevant to the FRS Pension Plan are defined in
s. 121.021, F.S. FRS Rules are published in ch. 60S, F.A.C.
Actuarial - An adjective that describes statistical elements, assump-
tions, and techniques used by actuaries. An "actuary" is an expert
who computes insurance or pension risks and plan costs based
upon plan membership, experience, and other factors. Actuaries
determine the level of funding required to provide benefits promised
under the FRS.
Average Final Compensation or AFC - The average of the 5 highest
years of salary earned during covered employment. For retirement
purposes, salaries are counted by fiscal year (July 1- June 30). (For
Hybrid Plan members, AFC is the average of the 5 highest fiscal years
of salary earned while participating in the FRS Pension Plan.) (See
page 18 for more on the AFC and related calculation factors.)
Beneficiary - The joint annuitant or any other person, estate, organi-
zation, or trust fund designated by the member to receive any
benefits which may be payable upon his or her death. (See also
"Beneficiary Designation," page 12.)
Closed Retirement Systems - The separate state - administered
retirement systems that existed before the FRS was created on
December 1, 1970, and have since been closed to new members.
These systems were consolidated under the FRS by chapter 121 of
the Florida Statutes, and include the State and County Officers and
Employees' Retirement System (SCOERS), the Teachers' Retirement
System (TRS), the Highway Patrol Pension System and the Judicial
Retirement System, as established by chapters 122, 238, 321, and 123,
F.S., respectively.
74
Compensation - Regular payment of salary by an FRS employer to
an FRS member for work performed in a covered position, including
certain overtime payments. By law, certain fees, bonuses, and other
amounts are not considered "compensation' under the FRS. (See
s. 121.021(22) and (47), F.S., or see subsection (16) of rule 60S- 6.001,
F.A.C., for details.)
Contribution - Regular payment by employers, on behalf of FRS
members, of the percentage of reported compensation required by
law to fund the members' FRS benefits. The term may refer to any
employee contributions the member may have made before the FRS
became noncontributory for its several membership classes. Also, the
term may refer to payments made by members or their employers to
purchase service credit or pay for service credit upgrades. (See page 10
for more on contributions and contribution rates.)
Contribution Rate - The percentage of compensation required to
fund each member's future FRS retirement benefits (through
employer contributions). Contribution rates vary depending on
retirement plan, membership class, and other factors. (See page 10.)
Cost -of- Living Adjustment or COLA - An annual increase in the FRS
Pension Plan retirement benefit (currently 3 percent). The increase
is added to the July monthly retirement benefit, and is intended
to help offset the effects of inflation. (If a member has been retired
for less than a full year on July 1st, the first COLA is a prorated
percentage based on the number of months the member was retired
before July 1st.) (See page 57 for more on the COLA.)
Covered Employment or Covered Position - Employment in a regu-
larly established position with an employer participating in the FRS
or in a state - administered retirement system. (See page 5 for more on
membership requirements.)
Creditable Service - Service for which retirement credit is earned
through paid employment in a regularly established position with
an FRS employer, as well as any optional service for which retirement
credit may be purchased. (See page 27 for more on creditable service.)
75
Deferred Retirement Option Program or DROP - An elective pro-
gram available for members of the FRS Pension Plan, Teachers' Retire-
ment System, and the State and County Officers and Employees'
Retirement System who are eligible for normal retirement. Under
this program, a member effectively retires and continues covered
employment for a limited period. While in DROP, the member's
deferred monthly retirement benefits accumulate, earning interest
and cost -of- living adjustments. When the DROP period is over, the
participant terminates covered employment and begins receiving
his or her predetermined monthly retirement benefit, as well as the
accrued DROP benefits. (See page 37 for more on DROP.)
NOTE: Disability retirees may not participate in DROP, and DROP partici-
pants do not qualify for disability retirement.
Defined Benefit Plan - An employer- sponsored retirement plan
under which members are promised a continuing benefit at retire-
ment if they meet certain age and /or service requirements. The
benefit amount is determined by formula, which is normally based
on the member's earnings, length of service, and membership class.
Promised member benefits are prefunded by contributions and
investment earnings. The plan sponsor or employer must ensure that
sufficient funds are raised to pay all promised benefits to current and
future retirees and their eligible beneficiaries. (The FRS Pension Plan is
a defined benefit plan.)
Defined Contribution Plan - An employer - sponsored retirement plan
under which contributions are made to individual member accounts
to generate funds for distribution to the member at retirement (termi-
nation). Contribution amounts are determined by the plan sponsor
or employer and are usually a set percentage of the employee's salary.
Investments are generally directed by the employee, among invest-
ment products offered by the plan. The benefit amount at retirement
(termination) is the sum that accumulates in the member's account,
based on contributions made and investment earnings/ losses. It is
the member's responsibility to ensure that sufficient moneys are
raised to provide for adequate retirement income. (The FRS Investment
Plan is a defined contribution plan. If you are a member of the FRS Investment
Plan and have questions concerning the plan, please call the MyFRS Financial
Guidance line toll free at 1- 866- 44- MyFRS, or 1- 866 - 446- 9377.)
76
Early Retirement - Under a defined benefit plan like the FRS
Pension Plan, "early retirement" is an elective, service -based
retirement that occurs before the member reaches his or her normal
retirement age or date. If a member retires early, he or she will receive
a reduced retirement benefit because eligibility requirements for
normal retirement have not been met. When a member of the FRS
Pension Plan elects to take an early service retirement, the benefit
is reduced by 5 percent for each year remaining until the member
would attain the normal retirement age for his /her membership class
(age 55 for special risk members and age 62 for all others). For less
than a full year, the reduction is prorated on a month-by -month
basis. A member must be vested to take an early service retirement.
Disability benefits are not reduced for early retirement, and vesting is
not required for in- line -of -duty disability or in- line -of -duty survivor
benefits. (See page 44 for more on early retirement and see page 23 for a
sample calculation.)
Effective Retirement Date - The date that a member's retirement
officially begins, based on his /her termination date (or date of death)
and the date the Division receives the application for retirement. (See
page 46 for more on the effective retirement date.)
Enrollment - The act by an employer agency of establishing member-
ship in the FRS for all or any of its employees.
Fiscal Year or Plan Year - For the FRS and the closed retirement
systems this term refers to a 12 -month period beginning on July 1st
and ending on June 30th.
Florida Retirement System or FRS - The retirement system estab-
lished on December 1, 1970, to consolidate the existing pension plans
(now the closed retirement systems) and provide a retirement, disa-
bility, and survivor benefit program for participating state and local
government employees. Today, the FRS is a single retirement system
consisting of two primary retirement plans and other programs ad-
ministered under chapter 121, F.S. The primary plans are a defined
benefit plan established under part I (the FRS Pension Plan) and a de-
fined contribution plan established under part II (the FRS Investment
Plan) of that chapter. Members under both plans participate in the
following membership classes: The Regular, Special Risk, Special Risk
Administrative Support, Senior Management Service, and Elected
Officers' Classes. In addition to the two primary plans, nonintegrated,
alternative defined contribution programs are available for specified
employee groups under part I, including the State University System
77
Optional Retirement Program, the Community College Optional
Retirement Program, and the Senior Management Service Optional
Annuity Program.
FRS Investment Plan - Officially named the Public Employee
Optional Retirement Program (PEORP), this plan is a defined contri-
bution plan created under part II of chapter 121, F.S., as an employer -
funded alternative for eligible employees. This plan, which provides
for vesting after 1 year of service, began enrolling members in July2002.
(See also the definitions for the Florida Retirement System, Defined Contribution
Plan, and Public Employee Optional Retirement Progrnin. Ifyou are a member
of the FRS Investment Plan and have questions concerning your benefits, please
call the MyFRS Financial Guidance line toll free at 1- 866 -44- MyFRS, or
1- 866 - 446- 9377.)
FRS Pension Plan - This plan is a defined benefit plan administered
under part 1 of chapter 121, F.S. The benefits to be paid at retirement
are guaranteed by the plan, and are based on a formula determined
under the plan. (See also definitions for the Florida Retirement System and
Defined Benefit Plan.)
Health Insurance Subsidy or HIS - A supplementary benefit pay-
ment that may be made to eligible FRS retirees and their surviving
beneficiaries (spouse or financial dependent) to help them cover
some of the cost of health insurance coverage. The amount received
is based on the member's length of service. Since July 1, 2001, the
subsidy has been $5 per month for each year of creditable service, with
a minimum subsidy payment of $30 per month (if the benefit is based
on just 6 years of creditable service) and a maximum subsidy pay-
ment of $150 per month (if the benefit is based on 30 or more years of
creditable service). The Division also administers the HIS Program for
eligible FRS Investment Plan members. (Seepage 57 f or more information
about the HIS.)
Hybrid Plan - A plan under which members of the FRS Pension
Plan may elect to participate in the FRS Investment Plan for future
service while retaining their pension plan service earned prior to the
election.
In- Line -of -Duty or In the Line of Duty - In the performance of the
duties required by the employer. (See pages 53 and 56 for information on
in- line- of =riu(i/ disability and survivor benefits.)
78
Interest - The term may refer to the amount charged on money
owed to the FRS Trust Fund, or, for participants of DROP, the term
may refer to the amount earned on retirement benefits that accrue on a
participant's behalf. Interest owed is charged from the date required
by law for the type of service purchased and is compounded annually
each June 30th, while DROP interest is earned from the month follow-
ing deposit and is compounded monthly.
Joint Annuitant - A type of beneficiary who is eligible to receive
certain continuing benefits upon an FRS Pension Plan member's
death. If a member who is retiring or entering DROP chooses benefit
payment option 3 or 4, his or her beneficiary must be a joint annuitant
to receive continuing benefits after the member's death. (See page 12
for information on beneficiary designation and see pages 48 and 54 for
more on benefit payments to a surviving joint annuitant.)
Membership Class or Class of Membership - Members of the FRS
participate in the following classes of membership: Regular Class,
Special Risk Class, Special Risk Administrative Support Class, Senior
Management Service Class, and Elected Officers' Class. (See page 6 for
more on FRS classes of membership.)
Normal Retirement, Normal Retirement Date, or Normal Retire-
ment Age - The point in time when a member first becomes eligible to
retire without a reduction of benefits, based on her/ her age or length
of service. Under the FRS Pension Plan, Teachers' Retirement System,
or the State and County Officers and Employees' Retirement System,
most vested members qualify for normal retirement by attaining
age 62 or by completing 30 years of creditable service, regardless of
age. Vested special risk members in the FRS Pension Plan qualify
for normal retirement when they: Attain age 55 or complete 25
years of special risk service, regardless of age; complete a combined
total of 25 years of special risk service and military service and are age
52; or complete 30 years of creditable service. (See page 44 for more on
normal retirement and see page 22 for a sample calculation.)
Option - Choice of benefit payment method under the FRS Pension
Plan. (The four benefit payment options available to retiring members
under this plan are described on page 47.)
Other Personal Services or OPS - See definitions of "Temporary
Position" and "Regularly Established Position."
Public Employee Optional Retirement Program or PEORP - See
definitions of "Florida Retirement System" and "FRS Investment Plan."
F
Reemployment after Retirement - This term means employment
after retirement under the FRS and generally refers to employment
with employers participating in the system. However, in the case of
disability retirement under the FRS, proscribed reemployment occurs
whenever a disability retiree is gainfully employed by any employer,
public or private. (See page 58 for more on reemployment requirements.)
Regularly Established Position - Regularly established positions are
covered for retirement under the FRS. In state government, a regu-
larly established position is a full -time or part -time position autho-
rized by law and paid from a salary appropriation or salary account
(not a temporary position, such as one paid from an "other personal
services' or "OPS" account). At the local level, a regularly estab-
lished position is one that will last beyond 6 consecutive months,
except as otherwise provided by rule of the Division of Retirement
(see Rule 605- 1.004(5), F.A.C.).
Senior Management Service Optional Annuity Program ( SMSOAP)
- A defined contribution plan offered under the FRS as an alter-
native for eligible state senior managers. The SMSOAP provides
retirement and death benefits through contracts with designated
provider companies. The employer contributes a percentage of the
participant's salary as required by law to the participant's account
and the participant may contribute a like amount. The SMSOAP
provides for full and immediate vesting of all contributions made
by or on behalf of participants.
State - Administered Retirement System - Any of the statewide
retirement systems administered by the state Division of Retirement.
These systems are the FRS (including the State University System
Optional Retirement Program and the Senior Management Service
Optional Annuity Program), Teachers' Retirement System, State and
County Officers and Employees' Retirement System, Highway
Patrol Pension System, and Judicial Retirement System.
State Community College System Optional Retirement Program
( CCORP) - A defined contribution plan available under the FRS as
an alternative for eligible faculty and administrators of community
colleges or charter technical career centers sponsored by community
colleges, if offered by the community college board of trustees. The
CCORP provides retirement and death benefits through contracts with
designated provider companies. The employing community college
contributes a percentage of the participant's salary as required by
law to the participant's account, and the participant may contribute a
:1
Iike amount. The CCORP provides for full and immediate vest-
ing of all contributions made by or on behalf of participants.
State University System Optional Retirement Program ( SUSORP)
- A defined contribution plan offered under the FRS as an alter-
native for eligible state university faculty and administrators. The
SUSORP provides retirement and death benefits through contracts
with designated provider companies. The employing university
contributes a percentage of the participant's salary as required by
law to the participant's account, and the participant may contribute a
like amount. The SUSORP provides for full and immediate vesting of
all contributions made by or on behalf of participants.
Temporary Position - Temporary positions are not covered for retire-
ment under the FRS (see page 5 for more on membership requirements.) A
temporary position in a state agency is one that is authorized under
s. 110.131, F.S., and is paid from a non -salary account (an "other per-
sonal services" or an "OPS" account). These positions are subject to
durational restrictions specified by law. At the local level, a temporary
position is one that will exist for less than 6 consecutive months,
or other position determined by rule of the Division regardless of
whether it will exist for 6 consecutive months or longer (see Rule 605-
1.004(5), F.A.C.).
Terminate or Termination - Termination of employment occurs
when a member ends all employment with all FRS employers and
remains off all FRS payrolls for at least 1 calendar month. A member
will cancel his or her retirement if he or she is reemployed by any FRS
employer in the calendar month following his or her termination
date. (See pages 16 and 45 for more on terminating employment and termi-
nation requirements.)
HI
Vest, Vested or Vesting - These terms refer to meeting the age
and/or length -of- service conditions that must be met under a
retirement plan for a member to qualify for a future benefit under that
plan. FRS vesting requirements are described as follows:
• Under the FRS Pension Plan, all members actively em-
ployed on July 1, 2001, vest for service retirement upon
completing 6 years of creditable service, regardless of
membership class. Under the laws in effect before that
date, members needed 7, 8, or 10 years of service to become
vested, depending on their membership class. Inactive
members who had not vested under the prior law and were
not in FRS - covered employment on July 1, 2001, must return
to covered employment for at least 1 work year, or for the
number of months needed to vest under the prior law, if
shorter. (See page 15 for more on vesting under this plan.)
NOTE: Special provisions apply for the surviving spouse of a mem-
ber who dies within 1 year of vesting.
• Under the FRS Investment Plan, members become vested
for contributions paid on their behalf (plus earnings) by com-
pleting 1 work year in a regularly established position with
an FRS employer (which may include service under the FRS
Pension Plan, the Senior Management Service Optional An-
nuity Program, or the Community College Optional Retire-
ment Program). Members vest with respect to the present
value of credit transferred from the FRS Pension Plan when
they meet the vesting requirements for the Pension Plan
(see above).
Work Year - The period of time a member must work to receive a
full year of service credit for retirement purposes. Under the FRS, a
year of creditable service consists of 12 months of covered employ-
ment in a fiscal year, unless the approved work year is shorter than
12 months, as is the case with employees of educational institutions
(for more on the work yearand determination of service credit, see page 27, or
see Rule 60S- 2,002(4), F.A.C.).
82
ABBREVIATIONS
The following short forms, acronyms, and abbreviations may be
found in this booklet:
AFC - Average Final Compensation
CCORP - Community College Optional Retirement Program
Division - Division of Retirement
DROP - Deferred Retirement Option Program
EOC - Elected Officers' Class
F.A.C. - Florida Administrative Code (official rules of the
various state government agencies in Florida)
FRS - Florida Retirement System
F.S. - Florida Statutes
HIS - Health Insurance Subsidy
PEORP - Public Employee Optional Retirement Program
SCOERS - State and County Officers and Employees'
Retirement System
SMSC - Senior Management Service Class
SMSOAP - Senior Management Service Optional
Annuity Program
SUSORP - State University System Optional Retirement Program
TRS - Teachers' Retirement System
83
PUBLICATIONS
The following publications are available to you, upon request,
from your personnel office or from the Division of Retirement
at the address shown on page 1. Or, contact the Division's Research
& Education Section by telephone at 850/488 -5706 (SUNCOM
278 - 5706), by FAX at 850/921- 0371(SUNCOM 291 - 0371), or by e -mail
at: rep@frs.state.fl.us. You may download materials marked with a
"`U" from the Division's Internet website: www.myflorida.com /frs .
Plan Guides
Membership Class Guides — A retirement guide is available
for each membership class of the FRS Pension Plan, describing
the benefits provided to members of the class. The guides are
published every other year and are distributed through employer
personnel offices to all members of the FRS Pension Plan.
Retirement Guide for the Teachers' Retirement System — This
handbook describes policies and benefits available to employees
still actively covered under the Teachers' Retirement System
(closed to new members since December 1, 1970).
FRS Disability Benefits 'D — This booklet provides explanations
of regular and in- line -of -duty disability benefits available to
members of the FRS Pension Plan and FRS Investment Plan.
FRS Survivor Benefits '0 — This booklet provides explanations
of benefits available under the FRS Pension Plan to eligible joint
annuitants and beneficiaries of deceased members.
Informational Booklets, Brochures & Pamphlets
Preparing to Retire s, — This brochure provides information use-
ful to you when you are preparing for retirement from the FRS Pen-
sion Plan. It describes the procedures and requirements to follow
Mien you apply for retirement benefits. This brochure is automatically
sent to members who obtain an official estimate of benefits.
After You Retire `'' — This brochure provides information about
retirement and survivor benefits, federal withholdinb taxes,
84
direct deposit of monthly benefits, the health insurance subsidy
(HIS), and reemployment after retirement. It is automatically
sent to members of the FRS Pension Plan at retirement.
Deferred Retirement Option Program (DROP) 10 — This pam-
phlet describes the Deferred Retirement Option Program (DROP),
discusses potential advantages and disadvantages of participation,
explains eligibility and participation requirements, answers com-
monly asked questions, and provides examples. It is recommended
for members nearing retirement age.
Preparing to Terminate DROP � — This document explains what
participants should expect when they terminate DROP (forms to
submit, when monthly benefits begin, etc.). It includes special tax
information on DROP payouts to help participants decide how
to receive their accrued DROP benefits. Access this paper via the
DROP page of our website.
Participating Employers — This document lists employers
participating in the FRS Pension Plan.
Senior Management Service Retirement Plan Alternatives 'I� --
This document and associated materials describe the participation
options available to state senior managers. This information can be
obtained via a link on the Optional Plans page of our website. The
information is not available from the Division in printed form.
Newsletters
FRS Bulletin � — This newsletter contains articles intended to
keep active members of the FRS Pension Plan informed of retire-
ment legislation, benefit provisions, and other retirement - related
news of interest. It is distributed annually or biannually either
through personnel offices or by mail to all FRS members.
FRS Retiree Newsletter 'b — This newsletter contains articles of
interest to retirees of the FRS Pension Plan regarding recent
retirement legislation, current events affecting retirees, and
selected subjects of interest to retirees. It is inserted annually or
biannually with retirement benefit payments or statements that are
mailed to retirees' home addresses.
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CTI'Y OF PALM BEACH GARDENS
MEMORANDUM
llh
TO: Mayor and Council
APPROVED: Ron Ferris, City Manage
DATE: July 10, 2006
FROM: Allan Owens, Finance Administrator
CC: Department Heads
SUBJECT: Fiscal year 2007 Proposed Budget
Introduction
The purpose of this memo is to provide Council updated information and changes made
subsequent to the June workshop regarding the proposed 2006107 operating and
capital improvement budget in preparation for the July 20`x' Council meeting.
Background
As you know, the budget was initially presented to and discussed by Council at a
workshop held on June 14, 2006. That budget was based upon the June estimated taxable
value of $9,089,791,278, and proposed a millage of 5.88 (5.70 operating and .18 debt
service). Subsequent to that workshop, we received the final valuation from Palm
Beach County of $9,278,120,298. Based on these final values, the debt millage would
decrease to .16 mills. With no change in the operating millage, an additional .5881,089
would be generated, and the total proposed millage would be 5.86 (5.70 operating and
.16 debt service).
Summary of Revisions to Budget
Attached to this memo please find updated General Fund revenue worksheets, as well
as an updated General Fund Budget Variance schedule to reflect these changes. Also
attached to this memo is a schedule of personnel by department, as requested by rice
Mayor Barnett at the June workshop.
The following table is a summary of all changes that have been made to the proposed
budget subsequent to the June workshop:
Revenues
Original
Increase
Revised Amount
Ad valorem
$51,034,633
$881,089
$51,915,722
Expenditures /Uses
Reserves $12,585,935 $881,089 $13,467,024
Staff is continuing to work on development of an enhanced economic development
program and spending plan, to include goals, objectives and economic incentives. In
addition, the concerns expressed by Council regarding additional police personnel are
being evaluated. Staff will present recommendations regarding economic development
and additional police personnel prior to the.first public hearing.
Overview of Revised Budget
As illustrated in the table below, the proposed General Fund budget, taking into account
the above revisions, is $79,048,298, which is 12% greater than the adopted fiscal year
2006 budget total of $70,581,228. However, a better measure of the proposed increase is
the change in operating expenditures. This amount excludes capital and ending balances,
and totals $63,943,980, which is $6,785,826 (11.87 %) greater than fiscal year 2006
operating expenditures.
GF BUDGET VARIANCES FROM 2006 -2007
Expenditures /Uses
Original
Proposed
8,467,070
12.00%
Less: Capital Outlay
Budget
Budget
Variance -
- 74.54%
Ending Balance
FY06
FY07
FY06 -FY07
%Variance
Revenues /Sources
70,581,228
79,048,298
8,467,070
12.00%
Less: Loan Proceeds
(4,445,700)
-
4,445,700
- 100.00%
Beginning Balance
(6,985,798)
(7,722,478)
(736,680)
10.55%
Total Operating Revenues
59,149,730
71,325,820
12,176,090
20.59%
Expenditures /Uses
70,581,228
79,048,298
8,467,070
12.00%
Less: Capital Outlay
(6,429,596)
(1,637,294)
4,792,302
- 74.54%
Ending Balance
(6,993,478)
(13,467,024)
(6,473,546)
92.57%
Total Operating Expenditures
57,158,154
63,943,980
6,785,826
11.87%
As discussed earlier, the final taxable valuation received from the Palm Beach County
Property Appraiser is $9,278,120,298. This represents an increase of $2,103,888,479
from the 2005 total valuation of $7,174,231,819. This is an increase of 29.3 %, with 10%
($717,154,741) coming from new construction, and 19.3% ($1,386,733,738) from re-
assessments of existing properties.
Based on the final tax roll information, the proposed operating millage of 5.7 is 19.16%
more than the roll back rate of 4.78. The proposed debt service millage is .16 mills, for a
total proposed millage rate of 5.86. This represents a 1.1 % reduction from the total rate
adopted in fiscal year 2006. This is a further reduction from the rate proposed at the
June 141' workshop, which reflected a decrease of .8% from the 2006 millage.
The effect of this proposed tax rate on three typical homeowners is illustrated in the
following table:
Effect of Proposed Tax Rate on Three Typical Properties
(with Homestead Exemption)
FY 2006 Property Valuation (with Homestead Exemption)
FY 2006 Millage Rate
FY 2007 Property Valuation (with 31/6 cap)
$ 500,000 $ 1,000,000 $ 1,500,000
5.928 $
2,964
$
5,928
$
8,892
$
515,000
$
1,030,000
$
1,545,000
FY 2007 Initial Proposed Millage Rate (6/14/06 Council Workshop) 5.880 $ 3,028 $ 6,056 $ 9,085
Total Tax Increase $ 64 $ 128 $ 193
FY 2007 Revised Proposed Millage Rate (7120106 Council Meeting) 5.860 $ 3,018 $ 6,036 $ 9,054
Total Tax Increase $ 54 $ 108 $ 162
Net Tax Savings with Revised Proposed Rate of 5.860 $ (10) $ (20) $ (31)
Sources and Uses of New Money
Total recurring revenues are projected to increase by $12.1 million. The sources of the
new recurring money are illustrated in the following chart:
r— - - -- —
Sources of New Money
$862,011
$11,314,079
■ Ad wAorem ■ Other Roue
Of the projected increase in recurring revenues of $12.1 million, approximately 45%
($5.4 million) goes toward increased personnel costs, while approximately 47% ($5.7)
million) goes toward increasing reserves, as illustrated in the chart below:
Uses of New Money
I
{I
$5,744,546 $5,436,283
$995,261
(g Personnel ■ Operating/Capital /Debt/Trfs ❑ Increase in Reserves,
Summary
As noted earlier, the additional revenue at the proposed rate of 5.86 mills would increase
reserves by $5.7 million to $13.4 million, which is 21% of total expenditures, and is
approximately $3.8 million greater than our target goal of 15 %. As discussed at the June
workshop, this provides Council the opportunity to fitrther reduce truces, or to evaluate
additional programs or services. As mentioned previously, staff will be presenting a
plan for an economic development and incentive program, as well as a
recommendation regarding additional police officers, prior to the first public hearing
on the budget.
If you have any questions concerning the proposed budget, please contact Mr. Ferris so
that we may schedule a meeting at your convenience to discuss any issues you may have.
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City of Palm Beach Gardens
General Fund Budget Variances
2006/2007
Fund 001 - General Fund
City Council
Administration Department
Public Relations Department
Information Systems Department
City Clerk
Legal Services Department
Human Resources Department
Finance Department
General Services
Police Department
Fire Department
Growth Management Department
Neighborhood Services
Recreation Department
Parks
Grounds Maintenance
Public Works Department
Construction Services - Building
Total Expenditures (including Capital Outlay and Reserves)
Less: Reserves
Subtotal Operating Expenditures
Less: Capital Outlay
Total Operating Expenditures
Adopted Proposed Difference by Percentage
Bud et 2006 Budget 2007 Dollar Amount Increase
$ 292,935 $
333,853 $
40,918
13.97%
636,070
646,875
10,805
1.70%
131,554
150,839
19,285
14.66%
1,322,479
1,382,019
59,540
4.50%
484,021
560,903
76,882
15.88%
421,400
462,663
41,263
9.79%
985,264
951,821
(33,443)
-3.39%
831,286
839,309
8,023
0.97%
12,380,170
20,297,634
7,917,464
63.95%
17,024,102
19,714,136
2,690,034
15.80%
15,003,264
16,580,384
1,577,120
10.51%
2,047,976
2,206,086
158,110
7.72%
666,490
750,124
83,634
12.55%
5,071,627
2,998,534
(2,073,093)
- 40.88%
2,316,139
2,225,293
(90,846)
-3.92%
1,677,584
1,366,548
(311,036)
- 18.54%
7,387,282
5,170,968
(2,216,314)
- 30.00%
1,901,585
2,410,309
508,724
26.75%
$ 70,581,228 $
79,048,298 $
8,467,070
12.00%
8,993,478
13,467,024)
5,592,457
92.57%
63,587,750
2,874,613
3.14%
(6,429,596)
(1,637,294)
4,792,302
- 74.54%
$ 57,158,154 $
63,943,980 $
7,666,915
11.87%
\ \Pbgsfile\ Finance \finance_administration \BUDGET \2007 Budget \Miscellaneous \2007 Comparisons
CITY OF PALM BEACH GARDENS
MASTER POSITION LIST
FY 2006 AND 2007
Information Technology FY 2006 Transfer In Transfer Out Rectess Request FY 2
Information Systems Administrator
Approved
0
0
New
Propose(
;lty Council
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
layor
1
0 0
0
0
1
.ouncil Members
4
0 0
0
0
4
Total City Council
5
0 0
0
0
5
Information Technology FY 2006 Transfer In Transfer Out Rectess Request FY 2
Information Systems Administrator
Approved
0
0
New
Proposed
Administration
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
City Manager
1
0 0
0
0
1
Assistant to the City Manager
1
0 0
0
0
1
Executive Assistant to the City Manager
1
0 0
0
0
1
Administrative Projects Coordinator
1
0 0
0
0
1
Public Relations Director
1
0 0
0
0
1
Director
i
0 (1)
0
0
0
6Deve,lopment
T.
6
0 (f)
0
0
S
t DYeelor Rion transferred to Growth Management Administration Deparhmnl.
System Specialist and the Website Developw
0 0
0
Information Technology FY 2006 Transfer In Transfer Out Rectess Request FY 2
Information Systems Administrator
1
0
0
0
0 1
Network Manager
1
0
0
0
0 1
Software Analyst
1
0
0
(1)
0 0
Network Specialist
1
0
0
0
0 1
MIS Technician
1
0
0
0
0 1
Website Developer
1
0
0
(1)
0 0
Software System Specialist
0
0
0
1
0 1
Software System Manager
0
0
0
1
0 1
Total Information Technology
6
0
0
0
0 6
Note: Software Analyst position was reclassed to Software
System Specialist and the Website Developw
0 0
0
0
Approved
New
Proposed
City Clerk
FY 2006 Transfer In
Transfer Out
Reclass
Request
FY 2007
City Clerk
1
0 0
0
0
1
Deputy City Clerk
1
0 0
0
0
1
Administrative Specialist III
1
0 0
0
0
1
Public Information /Recording Coordinator
1
0 0
0
0
1
Administrative Specialist If
1
0 0
0
0
1
Public Information Specialist
1
0 0
(1)
0
0
Citizen Services Specialist
0
0 0
1
0
1
Total City Clerk
6
0 0
0
0
6
Note: Public Information Specialist was reclassed to Citizen Services Specials(.
CITY OF PALM BEACH GARDENS
MASTER POSITION LIST
FY 2006 AND 2007
(Finance
Approved
Transfer In Transfer Out
Reclass
New
Proposec
egal
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
:dy Attorney
1
0 0
0
0
1
egal Assistant
1
0 0
0
0
1
Total Legal
2
0 0
0
0
2
(Finance
Approved
Transfer In Transfer Out
Reclass
Request
New
Proposed
Human Resources
FY 2006
Transfer In
Transfer Out
Reclass
Request
FY 2007
1
0
0
0
0
1
Human Resources Administrator
1
0
0
0
0
1
Assistant Human Resources Administrator
2
0
0
(1)
0
1
Generalist
1
0
0
1
0
2
Benefits Technician
1
0
0
(1)
0
0
Human Resources Technician
1
0
0
0
0
1
Risk /Training Coordinator
1
0
0
0
0
1
Special Projects Coordinator
0
0
0
1
0
1
2+tNa!'11- se:Rasouroea
7
0
0
0
0
T
Note: One Assistant Human Resources Administrator was redassed to a Generalist position and the Benefits
Technician was reclessed
1
Ito a Special Projects Coordinator.
0
0
0
1
Police Service Specialist
5
(Finance
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Finance Administrator
1
0
0
0
0
1
Deputy Finance Administrator
1
0
0
0
0
1
Accounting Manager
0
1
0
0
0
1
Senior Accountant
1
0
0
0
0
1
Staff Accountant
3
0
(1)
0
0
2
Payroll Coordinator
1
0
0
0
0
1
Finance Technician
2
0
0
0
0
2
Total Finance
9
1
(1)
0
0
9
Note: One Accountant position was transferred to the Building Department. The vacant Plans /Permit Specialist Position in Building was
Senior Network Specialist
transferred to the Finance Department and reclassed to an Accounting Manager.
0
0
0
0
Approved
New
Proposed
Police Administration
FY 2006
Transfer In
Transfer Out
Reclass
Request
FY 2007
Chief of Police
1
0
0
0
0
1
Major
1
0
0
0
0
1
Administrative Aide to the Police Chief
1
0
0
0
0
1
Lieutenant
1
0
0
0
0
1
Police Officer
1
0
0
0
0
1
Budget Technician
1
0
0
0
0
1
Police Network Manager
1
0
0
0
0
1
Senior Network Specialist
1
0
0
0
0
1
Quartermaster
1
0
0
0
0
1
Crime Analyst/Records Supervisor
1
0
0
0
0
1
Police Service Specialist
5
0
0
0
0
5
Communications Manager
1
0
0
0
0
1
Lead Dispatcher
3
0
0
0
0
3
Dispatcher
11
0
0
0
0
11
Administrative Specialist If
1
0
0
0
0
1
Telecommunications Technician
1
0
0
0
0
1
Telecommunications Manager
1
0
0
0
0
1
Total Police Administration
33
0
0
0
0
33
CITY OF PALM BEACH GARDENS
MASTER POSITION LIST
FY 2006 AND 2007
Approved
New
Proposed
Police Uniform Operations
FY 2006
Transfer In
Transfer Out
Reclass
Request
FY 2007
Major
1
0
0
0
0
1
Captain
1
0
0
0
0
1
Lieutenant
4
0
0
0
0
4
Sergeant
9
0
0
0
0
9
Police Officer
71
0
0
0
6
77
Police Aide
1
0
0
0
0
1
Administrative Specialist II
1
0
0
0
0
1
Total Police Uniform Operations
88
0
0
0
6
94
Note: New requests include 6 Police Officers.
0
0
0
1
Administrative Specialist II
1
Approved
New
Proposed
Police Special Operations
FY 2006 Transfer In Transfer Out
Reclass
Request
FY 2007
Major
1
0
0
0
0
1
Captain
1
0
0
0
0
1
Lieutenant
2
0
0
0
0
2
Sergeant
4
0
0
0
0
4
Police Officer
14
0
0
0
1
15
Evidence /Forensics Technician
2
0
0
0
0
2
Evidence Custodian
1
0
0
0
0
1
Youth Resources Assistant
1
0
0
0
0
1
Accreditation Manager
1
0
0
0
0
1
Administrative Specialist II
1
0
0
0
0
1
Total Police Special Operations
28
0
0
0
1
29
Nole: One new Tactical Crime Suppression (TAC) Officer position requested.
,roaLFgro Atlpnlnistration
13
0
0
0
Approved
New
Proposed
Fire Administration
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Fire Chief
1
0
0
0
0
1
Deputy Chief Operations
1
0
0
0
0
1
Deputy Chief Administration
1
0
0
0
0
1
Deputy Chief EMS Support Services
1
0
0
0
0
1
Division Chief Administrative Services
1
0
0
0
0
1
Chief Fire Inspector
1
0
0
0
0
1
Fire Services Coordinator
1
0
0
0
0
1
Administrative Specialist 111
1
0
0
0
0
1
Administrative Specialist II
1
0
0
0
0
1
Fire Inspector (Life Safety Lieutenant)
3
0
0
0
0
3
Public Education Specialist
1
0
0
0
0
1
,roaLFgro Atlpnlnistration
13
0
0
0
0
13
Approved
New
Proposed
Fire Emergency Services
FY 2006
Transfer In
Transfer Out
Reclass
Request
FY 2007
Division Chief Fleet/Facililies
1
0
0
0
0
1
Division Chief Training and Professional
1
0
0
0
0
1
Fire Captain
3
0
0
0
0
3
EMS Captain
3
0
0
0
0
3
Fire Lieutenant
18
0
0
0
0
18
Driver /Engineer
19
0
0
0
0
19
Fire Medic
50
0
0
0
0
50
Firefighter
18
0
0
0
0
18
EMS Insurance Technician
1
0
0
0
0
1
Lieutenant Training
1
0
0
0
0
1
Tofaf Fire Emergency Services
115
0
0
0
0
115
CITY OF PALM BEACH GARDENS
MASTER POSITION LIST
FY 2006 AND 2007
Approved
Approved
New
Proposed
Community Services (P%) Administration FY 2006
Transfer In
Transfer Out
Reclass
Reg uest
FY 2007
FY 2007
Superintendent
1
0
0
Community Services Administrator 1
0
0
0
0
1
Administrative Assistant 1
0
0
(1)
0
0
Administrative Specialist III 2
0
0
1
0
3
Administrative Specialist 11 1
0
0
(1)
0
0
Project Inspector /CADD Operator 1
0
(1)
0
0
0
Operations Director 1
0
0
0
0
1
Special Projects Coordinator 1
0
(1)
1
0
1
Director of Construction Services 1
0
(1)
0
0
0
Director of Public Facilities 1
0
(1)
0
0
0
Operations Manager 1
0
0
0
0
1
Purchasing Agent 1
0
0
0
0
1
Total CS P" Administration 12
0
(4)
0
0
8
Note: The Project InspectodCAD0 Operator position was transferred to Neighborhood Services (Code Enforcement) and
reclassed to
Operations Director. One Special Projects Coordinator was transferred to
Construction Services (Building) and reclassed to Resource Manager.
okftw of Construction Services was also transferred to the Construction
Services Department The Director
of Pubic Facilities was
transferred to the Golf special revenue fund. The Administrative Assistant
was reclassed to a Special Projects Coordinator and the Adminlstra-
five Specialist 1 was reclassed to an Administrative 5 'alist AI.
_
Approved
New
New
Proposed
Facilities Maintenance
FY 2006
Transfer In Transfer Out
Reclass
Re nest
FY 2007
Superintendent
1
0
0
0
0
1
Electrician
1
0
0
0
0
1
Maintenance V
0
0
0
1
0
1
Maintenance IV
1
0
0
1
0
2
Maintenance III
2
0
0
(1)
0
1
Maintenance 11
4
0
0
(1)
0
3
Maintenance 1
1
0
0
0
0
1
HVAC Technician
1
0
0
0
0
1
Plumber
1
0
0
0
0
1
Total Facilities Maintenance
12
0
0
0
0
12
Note: One Maintenance a position was reclassed to a Maintenance N and a Maintenance IN was reclassed
to a Maintenance
V position.
Approved
New
Proposed
Stormwater
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Maintenance IV
2
0 0
0
0
2
Maintenance III
1
0 0
0
0
1
Maintenance II
1
0 0
0
0
1
Maintenance I
1
0 0
0
0
1
Heavy Equipment Operator
4
0 (2)
0
0
2
General Maintenance
2
0 0
0
0
2
-rwoiskwwwaler
11
0 (2)
0
0
9
Note: 2 Heavy Equipment Operator positions were transferred to Fleet Maintenance Department and reclassed to mechanic III positions.
a
Approved
New
Proposed
Street Maintenance
FY 2006 Transfer in
Transfer Out
Reclass
Request
FY 2007
Superintendent
1
0 0
0
0
1
Maintenance V
0
0 0
1
0
1
Maintenance N
2
0 0
(1)
0
1
Maintenance II
1
0 0
0
0
1
Light Equipment Operator
1
0 0
0
0
1
Traffic Technician
2
0 0
0
0
2
Purchasing /Inventory Control Coordinator
1
0 0
0
0
1
i lr wStreetAbinNnance
a
0 0
0
0
8
Note: One Maintenance IV position was reclassed to a Maintenance v position.
CITY OF PALM BEACH GARDENS
MASTER POSITION LIST
FY 2006 AND 2007
Approved New Proposed
Riverside Maintenance FY 2006 Transfer In Transfer Out Reclass Request FY 2007
Maintenance II 1 0 0 0 0 1
Total Riverside Maintenance 1 0 0 0 0 0
Approved
New
Proposed
Fleet Maintenance
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Superintendent
1
0 0
0
0
1
Supervisor
1
0 0
0
0
1
Mechanic III
5
2 0
0
0
7
Mechanic II
1
0 0
0
0
1
Mechanic 1
1
0 0
0
0
1
Total Fleet Maintenance
9
2 0
0
0
11
Note: 2 mechanic III positions were transferred
in from Stormwater.
0
(1)
0
2
Approved New Proposed
Riverside Maintenance FY 2006 Transfer In Transfer Out Reclass Request FY 2007
Maintenance II 1 0 0 0 0 1
Total Riverside Maintenance 1 0 0 0 0 0
Approved
New
Proposed
Parks
FY 2006 Transfer In
Transfer Out
Reclass
Request
FY 2007
Director
1 0
0
0
0
1
Administrative Specialist III
1 0
0
(1)
0
0
Support Supervisor
0 0
(1)
1
0
0
Superintendent
0 1
0
0
0
1
Support Supervisor
0 0
0
0
0
0
Maintenance V
1 0
0
2
0
3
Maintenance IV
3 0
0
(1)
0
2
Service Technician
2 0
0
(1)
0
1
Maintenance III
1 0
0
0
0
1
Maintenance II
3 0
0
0
0
3
Maintenance I
8 0
(1)
0
0
7
Total Parks
20 1
(2)
0
0
19
Note The Administrative Specialist III position was
reclassed to Support Supervisor and transferred
out to Recreation General Programs as a
Recreation Supervisor. The Superintendent position
from Recreation Athletics and Special
Facilities was transferred
into the
Parks Dept.
One Service Technician was reclassed to a Maintenance
IV position and one Maintenance
I position was transferred to the Tennis
division.
Additionally, two Maintenance TV positions were reclassed
to Maintenance V positions.
Approved New Proposed
Riverside Maintenance FY 2006 Transfer In Transfer Out Reclass Request FY 2007
Maintenance II 1 0 0 0 0 1
Total Riverside Maintenance 1 0 0 0 0 0
Approved
New
Proposed
Grounds
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Superintendent
1
0 0
0
0
1
Maintenance IV
2
0 G
0
0
2
Maintenance III
0
0 0
1
0
1
Maintenance It
3
0 0
(1)
0
2
Maintenance I
1
0 0
0
0
1
Irrigation Technician
2
0 0
0
0
2
Spray Technician
1
0 0
0
0
1
Maintenance V
0
0 0
1
0
1
Lead Irrigation Technician
1
0 0
(1)
0
0
Total Grounds
fl
0 0
U
0
11
Note: One Maintenance II position was reclassed to a Maintenance
III. Lead
Irrigation Technician was reclassed to Maintenance V
Approved New Proposed
Riverside Maintenance FY 2006 Transfer In Transfer Out Reclass Request FY 2007
Maintenance II 1 0 0 0 0 1
Total Riverside Maintenance 1 0 0 0 0 0
Approved
New
Proposed
BRCRC Maintenance
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Pool Technician
1
0 0
0
0
1
Maintenance V
0
0 0
1
0
1
Maintenance IV
1
0 0
(1)
0
0
Maintenance II
2
0 0
0
0
2
Maintenance 1
1
0 0
0
0
1
Total BRCRC Maintenance
5
0 0
0
0
5
Note: One Maintenance IV was reclassed to a Maintenance
V position.
Approved New Proposed
Riverside Maintenance FY 2006 Transfer In Transfer Out Reclass Request FY 2007
Maintenance II 1 0 0 0 0 1
Total Riverside Maintenance 1 0 0 0 0 0
CITY OF PALM BEACH GARDENS
MASTER POSITION LIST
FY 2006 AND 2007
I
Approved
New
Proposed
New
Proposed
Growth Management
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Growth Management Administrator
1
0
0
0
0
1
Administrative Assistant
1
0
0
0
0
1
Development Compliance Manager
1
0
0
0
0
1
Development Compliance Technician
1
0
0
0
0
1
Administrative Specialist II
1
0
0
0
0
1
Development Director
0
1
0
0
0
1
ToW Growth Mona"~
3
1
0
0
0
6
Note: The Development Director position was transferred in from the Administration Department.
0
0
13
2
The GIS activity, was moved Into Its own cost center.
(2)
0
0
Accountant
0
1 0
Approved New Proposed
Economic Development FY 2006 Transfer in Transfer Out Reclass Re nest FY 2007
Director 1 0 0 0 0 1
Total Economilic-Drifivelpipmerit 1 0 0 0 0 1
Approved
New
Proposed
GIS
FY 2006 Transfer In Transfer Out
Reclass
Request
FY 2007
GIS Manager
1 0 0
0
0
1
GIs Technician
1 0 0
0
0
1
`, .tom .
2 0 0
0
0
2
NoN: Positions were removed from Growth Management
to create own coat center.
0
0
1
Approved New Proposed
Economic Development FY 2006 Transfer in Transfer Out Reclass Re nest FY 2007
Director 1 0 0 0 0 1
Total Economilic-Drifivelpipmerit 1 0 0 0 0 1
Approved
New
Proposed
Planning and Zoning
FY 2006
Transfer In Transfer Out
Reclass
Re nest
FY 2007
Planning Manager
3
0 0
0
0
3
Principal Planner
1
0 0
0
0
1
Senior Planner
1
0 0
0
0
1
Planner
3
0 0
0
0
3
Planning Specialist
2
0 0
0
0
2
Planning Technician
1
0 0
0
0
1
City Forester
1
0 0
0
0
1
Forestry Technician
1
0 0
0
0
1
7?dW Phoning and2oning
13
0 0
0
0
13
Approved
New Proposed
Construction Services/Building
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Director of Construction Services
0
1 0
0
0
1
Resource Manager
0
1 0
0
0
1
Building Official
1
0 0
0
0
1
Deputy Building Official
1
0 0
0
0
1
Building Inspector
11
0 0
1
2
14
Plans Examiner
2
0 0
2
0
4
Plans/Permit Specialist
1
0 (1)
0
0
0
Permit Technician
3
0 0
(1)
0
2
Cashier
1
0 0
0
0
1
Fire Plan Reviewllnspeclor
2
0 0
(2)
0
0
Accountant
0
1 0
0
0
1
T6111000nstruefta Services /Building
22
3 (1)
0
2
26
Note: The Director of Construction Services and the Resource Manager positions were transferred in from Community
Services (PW) Admin.
The 2 Fire Plan ReoinvAnspeclor positions were reclassed to Plans Examiner positions One permit Technician
position was reclassed to a
Building Inspector position. A vacant Plans/Permit Specialist
position was transferred to the finance Department and reclassified to an
'Accounting Manager. The Accountant position was transferred in from the Finance Department. New requests include 2 Building Inspectors.
CITY OF PALM BEACH GARDENS
MASTER POSITION LIST
FY 2006 AND 2007
Approved
New
Proposed
New
New
Proposed
Recreation Administration /Resources
FY 2006
Transfer In Transfer Out
Reclass
Re nest
FY 2007
Director
1
0
0
0
0
1
Resource Manager
1
0
0
0
0
1
Registration Supervisor
1
0
0
0
0
1
Administrative Specialist III
1
0
0
0
0
1
Registration Specialist
1
0
0
0
0
1
Recreation SupervisorNolunteers
1
0
0
0
0
1
Total Recreation AdminiResources
6
0
0
0
0
6
Approved
New
Proposed
New
New
Proposed
Recreation Aquatics
FY 2006
Transfer in Transfer Out
Reclass
Request
FY 2007
Pool Manager
1
0
0
(1)
0
0
Aquatics Complex Manager
0
0
0
1
0
1
Recreation Supervisor /Sr. Lifeguard
1
0
0
0
0
1
Lead Lifeguard
2
0
0
0
0
2
ltfuaNca.
4
0
0
0
0
4
Now The Pod Manager was reclassed to Aquatics Complex
Manage(.
Approved
New
Proposed
New
Proposed
Recreation Athletics and Spec Facilities
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Recreation Coordinator/Prog & Facilities
1
0 0
0
0
1
Recreation Supervisor
1
0 0
0
0
1
Recreation Superintendent
1
0 (1)
0
0
0
Total Athletics and Spec Facilities
3
0 (1)
0
0
2
Note: Recreation Superintendent transferred out to the Parks Department.
The Recreation CoordlnatodAthletics title was changed to read
0 0
Recreation Coordinator/Programs and Facilities.
0
11
Approved
New
Proposed
New
Proposed
Recreation General Programs
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Recreation Superintendent
1
0 0
0
0
1
Support Supervisor
0
1
(1)
0
0
Recreation Supervisor
1
0 0
1
0
2
TojafiGsnerAl Programs
2
1 0
0
0
3
iNote: The support Supervisor transferred In from the Parks Department and reclassed to a Recreation Supervisor.
11
0 0
0
Approved
New
Proposed
Recreation Special and Cultural Events
FY 2006 Transfer In Transfer Out Reclass
Request
FY 2007
Special and Cultural Events Coordinator
1 0 0 0
0
1
Recreation Supervisor Arts and Events
1 0 0 0
0
1
Total Special and Cultural Events
2 0 0 0
0
2
Approved
New
Proposed
Recreation Youth Enrichment
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Recreation Coordinator
1
0 0
0
0
1
Recreation Youth Instructor
8
0 0
0
0
8
Registration Specialist
1
0 0
0
0
1
Recreation Supervisor
1
0 0
0
0
1
Total Youth Enrichment
11
0 0
0
0
11
CITY OF PALM BEACH GARDENS
MASTER POSITION UST
FY 2006 AND 2007
Approved New Preposec
FY 2006 Transfer to Transfer Out Reclass Request FY 2007
Department Totals 501 12 (12) 0 9 sic
Approved
New
New
Proposed
Golf
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Director of Public Facilities
0
1
0
0
0
1
Golf Pro
1
0
0
0
0
1
Pro Shop Attendant
1
0
0
0
0
1
Administrative Specialist III
1
0
0
(1)
0
0
Operations Coordinator
0
0
0
1
0
1
Golf Course Superintendent
1
0
0
0
0
1
Golf Course Maintenance Coordinator
1
0
0
0
0
1
'General Maintenance Technician
6
0
0
0
0
6
Mechanic III
1
0
0
0
0
1
Total Golf
12
1
u
0
0
13
Note: Director of Public facilities was transferred in
Ifom Community Services (PW) Administration
and the Administrative
In
position eras
reclassed to Operations Coordinator.
Approved New Preposec
FY 2006 Transfer to Transfer Out Reclass Request FY 2007
Department Totals 501 12 (12) 0 9 sic
Approved
New
Proposed
Tennis
FY 2006
Transfer In Transfer Out
Reclass
Request
FY 2007
Tennis Manager
1
0 0
0
0
1
Pro Shop Attendant
1
0 0
(1)
0
0
Registration Specialist
0
0 0
1
0
1
Maintenance III
1
0 0
0
0
1
Maintenance 1
0
1 0
0
0
1
Total Tennis
3
1 0
0
0
J
Note'. Maintenance I position was
transferred in from the Parks Division. The Pro Shop Attendant was reclassed to a Regrstrabon Speciah5l.
Approved New Preposec
FY 2006 Transfer to Transfer Out Reclass Request FY 2007
Department Totals 501 12 (12) 0 9 sic
Approved
New
Proposed
Neighborhood Services (Code)
FY 2006
Transfer In
Transfer Out
Reclass
Request
FY 2007
Operations Director
0
1
0
0
0
1
Code Enforcement Supervisor
1
0
0
0
0
1
Code Enforcement Officer
5
0
0
(2)
0
3
Administrative Specialist II
1
0
0
0
0
1
Occupational License Specialist
1
0
0
0
0
1
Code Enforcement Officer /Fire
0
0
0
2
0
2
Total Neighborhood Services (Code)
8
1
0
0
0
9
Nate: The Operations Director position was transferred in from
Cornrmmily
Services (PW) Administration. 2 Code Enforcement Offer positions
were reclassed to Code Enforcement Officer /Fire positions.
Approved New Preposec
FY 2006 Transfer to Transfer Out Reclass Request FY 2007
Department Totals 501 12 (12) 0 9 sic