To address the membership status of members of a local retirement system whose employer becomes covered under the Florida Retirement System due to agency join, transfer, merger or consolidation and participate in a Deferred Retirement Option Program ...

 

DEPARTMENT OF MANAGEMENT SERVICES

Division of Retirement

RULE NO.:RULE TITLE:

60S-1.0075Transfer, Merger, or Consolidation of Governmental Units, Services, or Functions

PURPOSE AND EFFECT: To address the membership status of members of a local retirement system whose employer becomes covered under the Florida Retirement System due to agency join, transfer, merger or consolidation and participate in a Deferred Retirement Option Program for the local retirement plan.

SUMMARY: Amending the rule to address Florida Retirement System (FRS) membership status of employees of a local retirement system whose employer becomes covered under the FRS due to agency join, transfer, merger or consolidation and those members participating in a Deferred Retirement Option Program at the local retirement plan.

SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS AND LEGISLATIVE RATIFICATION: The Agency has determined that this will not have an adverse impact on small business or likely increase directly or indirectly regulatory costs in excess of $200,000 in the aggregate within one year after the implementation of the rule. A SERC has not been prepared by the Agency.

The Agency has determined that the proposed rule is not expected to require legislative ratification based on the statement of estimated regulatory costs or if no SERC is required, the information expressly relied upon and described herein: Not required because there are no adverse impacts on economic growth, business competitiveness or regulatory costs of more than $1M in the aggregate within five years of implementation.

Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.

RULEMAKING AUTHORITY: 121.031 FS.

LAW IMPLEMENTED: 112.0515, 121.011, 121.081 FS.

IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE HELD AT THE DATE, TIME AND PLACE SHOWN BELOW:

DATE AND TIME: Monday, November 17, 2014, 10:30 a.m., ET

PLACE: Division of Retirement of the Department of Management Services, 2450 Shumard Oak Blvd., Bldg. 2, Room 2-1326, Tallahassee, FL

PLEASE NOTE: All attendees must sign in with the security station and obtain a visitor badge.

Pursuant to the provisions of the Americans with Disabilities Act, any person requiring special accommodations to participate in this workshop/meeting is asked to advise the agency at least 48 hours before the workshop/meeting by contacting: Beth Rissinger, Operation and Pension Analyst, Division of Retirement, Department of Management Services at [phone]. If you are hearing or speech impaired, please contact the agency using the Florida Relay Service, 1(800)955-8771 (TDD) or 1(800)955-8770 (Voice).

THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Garry Green, Operations and Management Consultant Manager, Department of Management Services, Division of Retirement, 1317 Winewood Blvd., Bldg. 8, Tallahassee FL 32399-1560, [phone]

 

THE FULL TEXT OF THE PROPOSED RULE IS:

 

60S-1.0075 Transfer, Merger, or Consolidation of Governmental Units, Services, or Functions.

(1) The agency join, transfer, merger, or consolidation of governmental units, services, or functions, either at the state or local level or between levels of government, shall not result in the impairment or reduction in retirement benefits of any employee.

(2) Any Florida Retirement System (FRS) participating employer that undertakes the agency join, transfer, merger, or consolidation of governmental services or functions shall notify the Division of Retirement 60 days prior to such action. At the time the agency join, transfer, merger, or consolidation becomes effective, the agency shall provide:

(a) A copy of the official document that authorized the agency join, transfer, merger, or consolidation (e.g., agreement, resolution, ordinance, or statute);

(b) Certification of monthly service and earnings for all past service which newly enrolled members are eligible to claim in accordance with subsections 60S-2.003(3) and (6), F.A.C.; and

(c) A statement concerning each newly enrolled member’s eligibility for benefits from any local retirement system maintained by a governmental unit involved in the agency join, transfer, merger, or consolidation.

(3) When an agency join, transfer, merger, or consolidation results in an employee’s employing unit becoming a FRS Florida Retirement System participating employer, the following shall apply:

(a) If the employee is not a member of a local retirement system, the employee he or she shall be enrolled as a member of the FRS Florida Retirement System as of the effective date of the agency join, transfer, merger, or consolidation.

(b) If the employee is a member of a local retirement system, including a system established in accordance with Chapter 175 or 185, F.S., the employee he or she must elect in writing, as of the effective date of the agency join, transfer, merger, or consolidation, whether to remain in said local retirement system or transfer to the FRS Florida Retirement System.

1. If the employee elects to remain a member of the local system, he or she shall continue such membership shall continue, except as provided in sub-subparagraph a., as long as the employee remains he or she is employed by the participating employer to which the his or her employing unit was agency joined, transferred, merged, or consolidated.

a. If the member retires from the local system and remains employed or is reemployed with the same employer, the employee he or she shall be enrolled as a member of the FRS Florida Retirement System, provided he or she is credit is no longer accruing credit toward a benefit under said local system, except that members of a local retirement system, whose employer becomes covered under the FRS due to agency join, transfer, merger or consolidation, and those employees participating in a Deferred Retirement Option Program for of the local retirement plan are considered temporary employees under the FRS until the employee’s Deferred Retirement Option Program participation is completed.

b. If an employee covered under this subparagraph who rejected the opportunity to transfer to the FRS Florida Retirement System upon the agency join, transfer, merger, or consolidation subsequently becomes a member of the FRS Florida Retirement System, the member he or she may claim his or her rejected past service at total actuarial cost as provided in subsections 60S-2.003(3) and (6) and paragraph 60S-3.004(3)(b), F.A.C.

2. If the employee elects to become a member of the FRS Florida Retirement System at the time of the agency join, transfer, merger, or consolidation, the member he or she may claim his or her past service as creditable service under the FRS Florida Retirement System in accordance with subsections 60S-2.003(3) and (6) and paragraph 60S-3.004(3)(a), F.A.C.

(4) When a an agency join, transfer, merger, or consolidation results in a member’s employing unit ceasing to be a FRS Florida Retirement System participating employer, the following shall apply:

(a) If the governmental unit, service, or function to which the member’s employing unit is agency joined, transferred, merged, or consolidated operates, maintains, or participates in a local retirement system, such member must elect in writing, as of the effective date of the agency join, transfer, merger, or consolidation, whether to remain in the FRS Florida Retirement System or transfer to the local retirement system.

(b) If the governmental unit, service, or function to which the member’s employing unit is agency joined, transferred, merged, or consolidated does not operate, maintain, or participate in a local retirement system, such member shall continue membership in the FRS Florida Retirement System.

(c) If the member remains in the FRS Florida Retirement System, as provided in paragraph (a) or (b), he or she membership shall continue such membership as long as he or she is the member is employed by the agency to which the his or her unit was agency joined, transferred, merged, or consolidated.

(5) Any officer or employee of the consolidated or interim governments of Jacksonville, Florida who was enrolled in the FRS Florida Retirement System or a state retirement system administered under Chapter 121, F.S., as of May 15, 1976, regardless of the fact that such consolidated or interim governments did not qualify as “employers” as defined in Rule 60S-6.001, F.A.C., shall be deemed to have been a member of the retirement system in which the employee was he or she was enrolled during the period of such enrollment and employment by the consolidated or interim governments, subject to the following conditions:

(a) Such membership shall continue as long as the member remains an officer or employee of the consolidated or interim governments of Jacksonville, Florida.

(b) The member shall not have received a refund of employee his or her contributions. If the member has received a refund of employee contributions or if a refund is received in the future, participation in the state retirement system shall cease with the date of the refund.

(c) Credit shall not be granted for service in such employment for any service prior to May 15, 1976 for which contributions were not paid as of May 15, 1976.

(6) “Agency join” occurs when an agency chooses to participate in the FRS as defined in Section 121.051(2)(b), F.S.

Rulemaking Authority 121.031 FS. Law Implemented 112.0515, 121.011, 121.081 FS. History–New 5-15-91, Formerly 22B-1.0075, Amended___________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Dan Drake, Director

NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Craig J. Nichols, Agency Secretary

DATE PROPOSED RULE APPROVED BY AGENCY HEAD: April 29, 2014

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAR: May 30, 2014