Amendments are being made to Rule 19-13.001, F.A.C., to update the name of the “Summary Plan Document” to the “Summary Plan Description,” and to clarify that the "defined benefit plan" referred to in the rule is he "FRS Pension Plan, while the "...

 

STATE BOARD OF ADMINISTRATION

RULE NO.: RULE TITLE:
19-13.001: Roles and Responsibilities of the State Board of Administration of Florida
19-13.002: Roles and Responsibilities of Division of Retirement within the Department of Management Services
19-13.003: Role and Responsibilities of State, School District, and Local Employers Participating in the Florida Retirement System
19-13.004: Role and Responsibilities of Third Party Vendors
PURPOSE AND EFFECT: Amendments are being made to Rule 19-13.001, F.A.C., to update the name of the “Summary Plan Document” to the “Summary Plan Description,” and to clarify that the "defined benefit plan" referred to in the rule is he "FRS Pension Plan, while the "defined contribution plan" referred to in the rule is the "FRS Investment Plan." Rule 19-13.002, F.A.C, is being amended to update a statutory reference. Minor technical revisions are being made to all of the rules in this chapter for clarification purposes.
SUMMARY: To update information, to update a statutory reference, and to make minor technical revisions for clarification purposes. There are no other rules incorporating any of these proposed rules. Legislative ratification of these rule amendments is not required.
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: . Upon review of the proposed changes to the rules as well as all incorporated materials, the State Board of Administration has determined that the rules do not meet the statutory threshold for ratification by the legislature. There will be no impact on economic growth, job creation or employment, private-sector investment, or business competitiveness, and no increase in regulatory costs.
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: 121.4501(8) FS.
LAW IMPLEMENTED: 112.3173, 121.091(5), 121.4501(4), (5), (8), (9), (10), (14), (15), (19), 121.71, 121.72, 121.73, 121.74, 121.76, 121.77, 121.78 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(IF NOT REQUESTED, THIS HEARING WILL NOT BE HELD):
DATE AND TIME: Thursday, November 15, 2012, 9:00 a.m. – 11:00 a.m.
PLACE: Hermitage Room, the Hermitage Centre, 1801 Hermitage Blvd., Tallahassee, Florida 32308
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 5 days before the workshop/meeting by contacting: Tina Joanos, Agency Clerk, Office of the General Counsel, State Board of Administration, 1801 Hermitage Blvd., Tallahassee, Florida 32308, [phone], [e-mail].. 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: Ruth A. Smith, Assistant General Counsel, State Board of Administration, 1801 Hermitage Blvd., Tallahassee, Florida 32308, [phone], [e-mail].

THE FULL TEXT OF THE PROPOSED RULE IS:

19-13.001 Roles and Responsibilities of the State Board of Administration of Florida.

(1) The State Board of Administration of Florida (“SBA”) is responsible for establishing, implementing, and administering the optional defined contribution program, called the “Florida Retirement System Investment Plan” or “Investment Plan”, in accordance with Section 121.4501(1), F.S. The SBA is the Plan Sponsor. The plan documents consist of the Florida Statutes and rules adopted thereunder. The Summary Plan Description Document  (SPD) is a summary of the plan documents for the convenience of members. The SPD can be changed by the SBA at any time without prior notice to Florida Retirement System (FRS) members. The SBA’s primary responsibilities are set out in paragraphs (1)(a) through (1)(n), below. Each of these major responsibilities involves additional decisions which then in turn need to be implemented. Those decisions, to the extent they are not solely on a case-by-case basis, are adopted by rule. The SBA must ensure that all of the following individual responsibilities are carried out:

(a) through (h) No change.

(i) Movement of assets from the FRS Pension Plan defined benefit plan to the FRS Investment Plan defined contribution plan upon the election of a member to transfer and making such adjustments to plan accounts and member accounts as are necessary to process election reversals and prior period corrections to contributions and accompanying payroll data.

(j) through (n) No change

Rulemaking Authority 121.4501(8) FS. Law Implemented 121.4501(1), (4), (8), (9), (10), (14), (15), (19) FS. History–New 10-21-04, Amended 7-12-12,_________.

19-13.002 Roles and Responsibilities of the Division of Retirement within the Department of Management Services.

(1) The Division of Retirement (Division) within the Department of Management Services is contractually obligated to provides the following administrative services, in accordance with Section 121.4501(8)(a)(b)1., F.S., which:

(2) The administrative services referenced in subsection (1), above, are to:

(a) Determine membership eligibility and employer participation eligibility;

(b) Collect and process employer and employee payroll contributions and payroll-related data;

(c) Forward employer and employee payroll contributions and payroll-related data to the Investment Plan Aadministrator, including date of termination and leave of absence indicators, if available;

(d) through (j) No change.

Rulemaking Authority 121.4501(8) FS. Law Implemented 112.3173, 121.091(5), 121.4501(8), (10) FS. History–New 10-21-04, Amended 10-25-07, 7-12-12,_________.

19-13.003 Role and Responsibilities of State, School District, and Local Employers Participating in the Florida Retirement System.

All state, school district, and local employers (employers) who participate in the Florida Retirement System (FRS) (employers) have the following duties and responsibilities:

(a) through (b) No change.

Rulemaking  Authority 121.4501(8) FS. Law Implemented 121.4501(5), (10)(h), 121.71, 121.72, 121.73, 121.74, 121.76, 121.77, 121.78 FS. History–New 10-21-04, Amended 7-12-12,_________.

19-13.004 Role and Responsibilities of Third Party Vendors.

(1) The Administrator provides administrative services in the operation of the Investment Plan other than those provided by the Division as set forth in Rule 19-13.002, F.A.C. The Administrator also provides enrollment processing for the Florida Retirement System (FRS). Other administrative services are provided by the Division of Retirement within the Department of Management Services (Division). Those services are described in Rule 19-13.002, Florida Administrative Code. The Administrator’s primary duties and responsibilities are to:

(a) through (l)  No change.

(m) Provide phone response service on a toll-free line to assist members and employers to accomplish any required responsibility; and

(n) Provide recordkeeping for all Investment Plan data within its responsibilities, including monitoring of monetary limits imposed by the federal Internal Revenue Code.; and,

(o) Administer qualified domestic relations orders (QDROs).

(2) No change.

(3) Multiple providers hired by the SBA furnish the investment options for Investment Plan members. Section 121.4501, F.S., is generally constructed as an unbundled architecture, meaning that neither the Administrator TPA nor the education providers are permitted to offer investment products, and as a consequence, the SBA has hired multiple institutional investment managers and providers of mutual funds. Some of the providers are unbundled institutional investment managers, which manage assets in a particular asset class and in a particular style, and which are responsible solely for money management. Other providers are bundled providers which provide mutual funds or investment options in collective trusts which are their own funds or funds contracted for or from another money management group. Some bundled providers provide solely their own funds; others provide solely other fund family’s funds; and others provide a combination. An additional investment provider has been hired to offer annuities to retiring members. Each investment manager:

(a) through (c) No change.

(4) through (5)  No change.

Rulemaking Authority 121.4501(8) FS.  Law Implemented  121.4501(4), (8)(b), (e)1., (9)(a), (10) FS. History–New 10-21-04, Amended 7-12-12,_________.

NAME OF PERSON ORIGINATING PROPOSED RULE: Ron Poppell, Senior Officer, Defined Contributions Programs
NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Trustees of the State Board of Administration
DATE PROPOSED RULE APPROVED BY AGENCY HEAD: October 23, 2012
DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAR: October 5, 2012