To repeal rules 60U-1.003, 1.004, 1.005, 1.006, and 1.007, which are unnecessary, duplicative of statutory requirements, or are otherwise being replaced, and to adopt rules 60U-1.011, 1.012, and 1.013 to promulgate definitions and update the rules ...

 

DEPARTMENT OF MANAGEMENT SERVICES

Division of Retirement - Optional Retirement Program

RULE NOS.:RULE TITLES:

60U-1.003Preservation of Rights

60U-1.004Participation

60U-1.005Designation of Eligibility of Administrative and Professional Positions

60U-1.006Approved Forms

60U-1.007Dual Employment

60U-1.011Definitions

60U-1.012Program Administration

60U-1.013Employer and Employee Contributions

PURPOSE AND EFFECT: To repeal rules 60U-1.003, 1.004, 1.005, 1.006, and 1.007, F.A.C., which are unnecessary, duplicative of statutory requirements, or are otherwise being replaced, and to adopt rules 60U-1.011, 1.012, and 1.013, F.A.C. to promulgate definitions and update the rules regarding administration of the State University System Optional Retirement Program (SUSORP), including its forms and the retention of administrative costs.

SUMMARY: Repeal of rules 60U-1.003, 1.004, 1.005, 1.006, and 1.007, F.A.C., and the creation of rules 60U-1.011, 1.012, and 1.013, F.A.C. to promulgate definitions and to update the rules regarding the administration of the SUSORP.

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: the economic review conducted by the agency.

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, 121.35 FS.

LAW IMPLEMENTED: 121.031, 121.051, 121.052, 121.35 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: January 19, 2016, 10:00 a.m.

PLACE: Division of Retirement of the Department of Management Services, 2450 Shumard Oak Blvd., Bldg. 2, Tallahassee, Florida 32311

THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Garry Green, Operations and Management Consultant Manager, Department of Management Services, Division of Retirement, 2450 Shumard Oak Blvd., Bldg. 2, Tallahassee FL 32311, [phone]

 

THE FULL TEXT OF THE PROPOSED RULE IS:

 

60U-1.003 Preservation of Rights.

Rulemaking Specific Authority 121.031 FS. Law Implemented 121.35 FS. History–New 9-5-84, Formerly 22U-1.03, 22U-1.003, Amended 10-20-93, Repealed        .

 

60U-1.004 Participation.

Rulemaking Specific Authority 121.031 FS. Law Implemented 121.35, 121.051 FS. History–New 2-28-84, Formerly 22U-1.04, Amended 3-11-87, 2-7-89, 9-5-90, Formerly 22U-1.004, Amended 3-18-93, 10-20-93, 2-24-99, Repealed       

 

60U-1.005 Designation of Eligibility of Administrative and Professional Positions.

Rulemaking Specific Authority 121.031 FS. Law Implemented 121.35 FS. History–New 2-28-84, Formerly 22U-1.05, Amended 3-11-87, 2-7-89, 11-14-91, Formerly 22U-1.005, Amended 3-18-93, 10-20-93, Repealed        .

 

60U-1.006 Approved Forms.

Rulemaking Specific Authority 121.031 FS. Law Implemented 121.051(1)(a), 121.35 FS. History–New 2-28-84, Amended 9-5-84, Formerly 22U-1.06, Amended 12-5-90, Formerly 22U-1.006, Amended 1-4-93, 10-20-93, 1-10-95, 5-14-95, 9-18-96, 10-14-98, 1-24-00, 12-19-00, 9-18-07, 5-22-08, Repealed        .

 

60U-1.007 Dual Employment.

Rulemaking Specific Authority 121.031 FS. Law Implemented 121.052, 121.35 FS. History–New 11-14-91, Formerly 22U-1.007, Repealed       .

 

60U-1.011 Defintions.

The acronyms, titles, words, and phrases in this chapter shall be construed according to their plain meaning, in light of the context and subject matter, unless expressly defined otherwise in this rule, this chapter, or in Chapter 121, F.S. Titles, words, and phrases so expressly defined may be initially capitalized for convenient reference and for notice purposes only.

(1) FRS – Florida Retirement System.

(2) Mandatory Participant - One who must become a Participant due to appointment to positions listed in s. 121.051(1)(a)2., F.S.

(3) Participant – A successful enrollee in the SUSORP.

(4) Provider Company – A business designated by the Division from which a Participant may choose to purchase investment products under the SUSORP.

(5) SUSORP – State University System Optional Retirement Program.

(6) SUSORP Election Window – The period beginning the date a person becomes an Employee of the State University System who as a result is eligible or required to be a Participant, and the earlier of:

(a) 90 days thereafter;

(b) The person becoming a Participant; or

(c) The person becoming ineligible to be a Participant.  

Rulemaking Authority 121.031, 121.35 FS. Law Implemented 121.35 FS, New_______.

 

60U-1.012 Program Administration.

The forms referenced in this rule are required by the Division to administer the SUSORP and are available from the Division’s website at www.frs.myflorida.com; by calling the Division toll free 877-378-7677 or in the Tallahassee local calling area at 850-778-4696; or, if hearing or speech impaired, by calling the Division via T.D.D. at Florida Relay System by dialing 711 or 800-955-8771. Upon receipt of a form required under this rule from an Employee, the Employer shall complete its portion of the form and submit the completed form to the Division.

(1) Program Enrollment

(a) In order to elect to become either a Participant or a Member, an Employee, upon becoming employed in a position listed in s. 121.35(2)(a), F.S., that is not listed in s. 121.051(1)(a)2., F.S., must complete Form ORP-ENROLL-1, “State University System Optional Retirement Program (SUSORP) Retirement Plan Enrollment,” effective November 2015 and available at http://www.flrules.org/Gateway/reference.asp?No=Ref-        , which is incorporated by reference, and must submit this form to his or her EMPLOYER during the SUSORP Election Window.

(b) A Mandatory Participant shall not have the option of membership in the FRS, notwithstanding any prior membership in the FRS. A Mandatory Participant’s enrollment in the SUSORP is effective the first day of eligible employment. A Mandatory Participant shall, during the SUSORP Election Window, file Form ORP-MAND-1, “State University System Optional Retirement Program (SUSORP) Mandatory Participation Form”, effective November 2015 and available at http://www.flrules.org/Gateway/reference.asp?No=Ref-       , which is incorporated by reference, with his or her Employer. Contributions will continue to be held in suspense without earning interest or incurring losses until such time as the Participant completes the required forms.

(2) Contribution Reallocations and Transfers.

(a) In order to redirect future Employer contributions, required Employee contributions, and voluntary Employee contributions to one or more Provider Companies at a time, the Participant must complete Form ORP-CHANGE-1, “State University System Optional Retirement Program (SUSORP) Change Form,” effective November 2015 and available at http://www.flrules.org/Gateway/reference.asp?No=Ref-       , which is incorporated by reference, and submit it to his or her Employer.

(b) After the contributions forwarded from the SUSORP Trust Fund are deposited with the designated Provider Companies, Participants shall use froms from the Provider Companies to transfer funds between investment products with the same Provider Company and between Provider Companies.

(c) Pursuant to section 121.35(3), F.S., a Participant who became a Participant between July 1, 1984, through December 31, 1992, shall submit Form ORP-2A, “State University Optional Retirement Program (SUSORP) Retirement Conversion Form,” effective November 2015 and available at  http://www.flrules.org/Gateway/reference.asp?No=Ref-       , which is incorporated by reference, in order to transfer a sum representing the present value of the accumulated benefit obligation under the Florida Retirement System Pension Plan to the SUSORP. 

(3) Program Distributions.

(a) The Participant shall to notify the Division and the Provider Companies of the date to begin receiving a benefit in accordance with section 121.35(5), F.S. The Provider Companies must have approval from the Division before making the initial distribution to the Participant. Benefits may be deferred until such time as the Participant chooses to make such application. Such distribution is initiated by the Participant completing and submitting to the Employer Form ORP-RETIRE-1, “State University System Optional Retirement Program (SUSORP) Application for Retirement and Retirement Distribution,” effective November 2015 and available at http://www.flrules.org/Gateway/reference.asp?No=Ref-       , which is incorporated by reference, and any forms required by the Provider Company.

(b) Effective July 1, 2012, if a Participant has terminated employment from all Employers for one calendar month and has reached the Normal Retirement Date, the Participant may request a one-time distribution of up to 10 percent (10%) of the account balance. For example, if a Participant terminates employment on May 15, the one calendar month is June. Therefore, the Participant may request a one-time distribution of up to 10% in July.

(c) A Participant who is age 70½ or older may not receive a required minimum distribution per Section 121.35(5)(b), F.S., unless the Participant has terminated employment with all Employers.  In order to begin receiving a required minimum distribution, the Participant must notify the Division by completing and submitting, to the most recent Florida Retirement System particpating  Employer with which the Participant was employed, Form ORP-RMD-1, “State University System Optional Retirement Program (SUSORP) Application for Required Minimum Distribution Authorization,” effective November 2015 and available at http://www.flrules.org/Gateway/reference.asp?No=Ref-       , which is incorporated by reference.  The Provider Companies must have approval from the Division before making a required minimum distribution to the Participant.

(4) Refund of Voluntary Employee Contributions

(a) The Participant must be terminated from employment with all Employers for three calendar months to be eligible to receive a refund of voluntary Employee contributions.

(b) The Participant shall notify the Division and the Provider Companies of the date and under what provisions the voluntary Employee contributed portion of the account are to be received. The Participant shall submit Form ORP-REFUND-1, “State University System Optional Retirement Program (SUSORP) Application for Refund of Voluntary Employee Contributions Only,” effective November 2015 and available at http://www.flrules.org/Gateway/reference.asp?No=Ref-       ,  which is incorporated by reference, to the Employer to initiate a refund of voluntary employee contributions. The Provider Companies must have approval from the Division before refunding the voluntary Employee contributions to the Participant.

Rulemaking Authority 121.031, 121.35 FS. Law Implemented 121.031, 121.35 FS, New_______.

 

60U-1.013 Program Administrative Costs.

The following amounts will be retained from the Employer contributions to pay for program administrative costs:

Dates Rates

July 1, 1984 through September 30, 1984 0.17%

October 1, 1984 through June 30, 1985 0.53%

July 1, 1985 through June 30, 1988 0.10%

Effective July 1, 1988 0.01%

Rulemaking Authority 121.031 FS. Law Implemented 121.35(4)(a)5., FS.  New_________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Dan Drake, Director

NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Chad Poppell, Secretary

DATE PROPOSED RULE APPROVED BY AGENCY HEAD: December 16, 2015

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAR: September 22, 2015