The rule amendments to Rule 19-11.001 serve to indicate that a “member” of the Investment Plan includes an individual who is deemed to be a renewed member pursuant to Section 121.122, Florida Statutes, which has been amended by Chapter 2017-88, Laws ...

 

STATE BOARD OF ADMINISTRATION

RULE NOS.:RULE TITLES:

19-11.001Definitions

19-11.002Beneficiary Designations and Distributions for FRS Investment Plan

19-11.003Distributions from FRS Investment Plan Accounts

19-11.004Excessive Trading in the FRS Investment Plan

19-11.006Enrollment Procedures for New Hires

19-11.007Second Election Enrollment Procedures for the Florida Retirement System Retirement Programs

19-11.008Forfeitures

19-11.009Reemployment with an FRS-Participating Employer after Retirement

19-11.012Rollovers or Plan to Plan Transfers to or from the FRS Investment Plan

19-11.013FRS Investment Plan Self-Directed Brokerage Account

19-11.014Benefits Payable for Investment Plan Disability and In-Line-Of-Duty Death Benefits

PURPOSE AND EFFECT: The rule amendments to Rule 19-11.001 serve to indicate that a “member” of the Investment Plan includes an individual who is deemed to be a renewed member pursuant to Section 121.122, Florida Statutes, which has been amended by Chapter 2017-88, Laws of Florida, to provide that certain retirees who are reemployed on or after July 1, 2017, may be renewed members of the Investment Plan. Rule 19-11.002 is being amended to indicate that an Investment Plan member who is killed in the line of duty shall have certain survivorship benefits paid; to indicate the dates that certain enrollment forms and second election enrollment forms have been amended; and update the name of the investment fund used to hold account funds where the beneficiary cannot be located. The amendments to Rule 19-11.003, F.A.C. adopt the latest version of the Employment Termination Form and to make a few minor editorial revisions. Rule 19-11.004, F.A.C. is being amended to adopt the revised Transfer Request Form- Excessive Fund Trading Violators. Rule 19-11.006 is being amended to adopt the latest versions of the applicable enrollment forms; and to update and clarify information concerning specific enrollment procedures. Rule 19-11.007, F.A.C. is being amended to adopt the latest versions of the Second Election enrollment forms; and to indicate that an Investment Plan member that is eligible to be a renewed Investment Plan member on or after July 1, 2017 is not eligible to use the second election to transfer to the Pension Plan. Rule 19-11.008, F.A.C. is being amended to indicate the any unvested Investment Plan account balances will be transferred to a suspense account the funds of which will be invested in the FRS Intermediate Bond Fund. Rule 19-11.009, F.A.C. is being amended to indicate that, as provided by amendments to Section 121.122, Florida Statutes, a retiree of the Investment Plan, Senior Management Service Optional Annuity Program (SMSOAP), State University System Optional Retirement Program (SUSORP) and State Community College System Optional Retirement Program (SCCSORP) who is reemployed with a FRS-participating employer in a covered position on or after July 1, 2017 will be a mandatory renewed member of the Investment Plan, unless employed in a position eligible for participation in the SUSORP or SCCSORP. Such renewed member will be enrolled in the Regular Class, unless the position meets the requirements to enroll in the Special Risk Class, Elected Officers’ Class or Senior Management Service Class. Rule 19-11.012, F.A.C. is amended to adopt the latest version of the rollover forms. Rule 19-11.013, F.A.C. is amended to set forth how the Self-Directed Brokerage Account enrollment form can be obtained and to make a few clarifications. Rule 19-11.014 is being updated to indicate that the survivorship benefits paid to the surviving children of an Investment Plan member killed in the line-of-duty shall be paid as provided in Section 121.091(7)(d) and (i), Florida Statutes.

SUMMARY: To adopt updated forms; to set forth some clarifications; to recognize changes enacted by Chapter 2017-88, Laws of Florida, that provide that certain retirees who are reemployed on or after July 1, 2017, may be renewed members of the Investment Plan; to recognize that in-line-of-duty death benefits are available to the spouse and dependent children of any Investment Plan member and not just special risk members. There are no other rules incorporating the proposed amended rules. The proposed amendments will not have an effect on any other rules.

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: Based on its analysis of the rule amendments and incorporated materials, as well as the fact that it is not a regulatory agency, 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 resulting from the proposed rule amendments.

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: 121.78(3)(c); 121.4501(8 ) FS.

LAW IMPLEMENTED: 119.071, 120.569, 120.57, 120.573, 121.021, 121.051, 121.055, 121.091, 121.35, 121.4501(1), (2), (3), (4), (5), (6), (7), (8), (9), (10), (11), (12), (13), (14), (15), (19), 121.591, 121.5912; 121.71, 121.72, 121.74, 121.77, 121.78, 215.44(8), 732.802, 744.301, 1012.875(3) 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: Monday, November 20, 2017, 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, FL 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, Office of the General Counsel, State Board of Administration, 1801 Hermitage Blvd., Tallahassee, FL 32308, [phone], [e-mail]

 

THE FULL TEXT OF THE PROPOSED RULE IS:

 

19-11.001 Definitions.

The following words and terms shall have the following meanings for purposes of Chapters 19-11 and 19-13, F.A.C.:

(1) through (36)  No change.

(37) “Member,” “FRS Investment Plan Member,” or “Investment Plan Member” means an employee who elected to participate, defaulted, or is considered a renewed member pursuant to s. 121.122, F.S., and has an account established, in the Investment Plan as a result of current or previous employment with an FRS-covered employer; a person who has been designated as an alternate payee due to a qualified domestic relations order (“QDRO”); or a designated beneficiary when a member is deceased.

(38) through (49)  No change.

Rulemaking Authority 121.78(3)(c), 121.4501(8) FS. Law Implemented 121.78, 121.4501 FS. History–New 12-8-02, Amended 3-9-06, 7-12-12, 12-16-12, 6-5-14, 8-18-14, 12-30-15, 4-12-17, _____________.

 

19-11.002 Beneficiary Designations and Distributions for FRS Investment Plan.

(1)(a)  No change.

(b) An Investment Plan member enrolled in the Special Risk Class who dies in the line of duty shall have survivor benefits paid in accordance with Section 121.591(4), F.S., and Rule 19-11.014, F.A.C.

(c) Monthly survivor benefits for the spouse and child(ren) of members provided by Section 121.591(4), F.S., are payable in lieu of benefits otherwise payable under Section 121.591(1), F.S., or survivor benefits payable under Section 121.591(3), F.S., and shall supersede any other distribution that may have been provided by the member’s designation of beneficiary.

(2) through (3)  No change.

(4)(a) If the member enrolls in the Investment Plan using the EZ Retirement Plan Enrollment Form for Regular, Special Risk and Special Risk Administrative Support Class Employees, Form ELE-1-EZ, rev. 08-16, the General Retirement Plan Enrollment Form for Regular Special Risk and Special Risk Administrative Support Class Employees, Form ELE-1, rev. 07-17 10-16, which are adopted and incorporated by reference in subsection 19-11.006(2), F.A.C., or the 2nd Election EZ Retirement Plan Enrollment Form, Form ELE-2-EZ, rev. 07-17 08-16, or the 2nd Election Retirement Plan Enrollment Form, Form ELE-2, rev 07-17 10-16, which are adopted and incorporated by reference in subsection 19-11.007(3), F.A.C., the member agrees to the beneficiary designation contained in Section 121.4501(20), F.S., unless the member submits a beneficiary designation as provided in subsection (2) herein.

(b) through (g) No change.

(5) through (6) No change.

(7) Per Florida Law Beneficiary Designation.

(a) through (c) No change.

(d) After one year from the date of the member’s death, if the beneficiary cannot be located or if a beneficiary cannot be identified, the account will be transferred to the Suspense Account. By calendar year-end of each year following the transfer to the Suspense Account, the Investment Plan Administrator will attempt to locate and obtain the Social Security number or the Taxpayer Identification Number of the beneficiary. The transferred funds shall be invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund. The amount will be held in the Investment Plan Suspense Account until (1) the beneficiary contacts the FRS Investment Plan; or (2) another beneficiary requests consideration as the deceased’s proper beneficiary; or, (3) at the end of 10 years in the Suspense Account, the amount is transferred to the Investment Plan Forfeiture Account, where it is held indicating the name of the deceased member and the name of the beneficiary, if known.

(e) No change.

(8) through (13) No change.

(14)(a) through (b) No change.

(c) After one year from the date of the member’s death, if the beneficiary cannot be located, the account will be transferred to the Suspense Account. No later than calendar year-end, of each year following the transfer to the Suspense Account, the Investment Plan Administrator will attempt to locate and obtain the Social Security number or the Taxpayer Identification Number of the beneficiary. The transferred funds shall be invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund. The amount will be held in the FRS Investment Plan Suspense Account until (1) the beneficiary contacts the Investment Plan; or (2) another beneficiary requests consideration as the deceased’s proper beneficiary; or, (3) at the end of 10 years in the Suspense Account, the amount is transferred to the Investment Plan Forfeiture Account, and the Administrator will maintain a record of the name of the deceased member and the name of the beneficiary, if known.

(d) Should the beneficiary be located and provides a Social Security number, a check will be issued to the beneficiary, with actual earnings, from the date of transfer from the member’s account to the Suspense Account and/or Forfeiture Account subject to applicable income tax withholding, which shall be paid to the tax authorities at the time of such payment to the beneficiary.

(15)(a) Pursuant to Federal guidelines, if the deceased member’s account is to be paid to the member’s estate but no Estate Identification Number is provided, the account will not be paid to the Estate until the Estate Identification Number is received. In the event that no Estate Identification Number is provided within one year from the date of notification to the Investment Plan Administrator of the member’s death, the Investment Plan Administrator will transfer the deceased member’s account to the Suspense Account indicating the name of the deceased member. If after 10 years after the date of death, the Investment Plan Administrator has not received an Estate Identification Number, the deceased member’s account will be transferred to the Investment Plan Forfeiture Account and the Administrator will maintain a record of the name of the deceased member. The transferrred funds shall be invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund.

(b) The Investment Plan Administrator will, at the time of the transfer to the Suspense Account, make a reasonable effort to obtain the Estate Identification Number. Additionally, by calendar year-end of each year following the transfer to the Suspense Account, the Investment Plan Administrator will attempt to locate and obtain the Estate Identification Number.

(c) The amount will be held in the Investment Plan Suspense Account until (1) the member’s estate representative contacts the Investment Plan; or (2) a beneficiary requests consideration as the deceased’s proper beneficiary; or, (3) at the end of 10 years in the Suspense Account, the amount is transferred to the Investment Plan Forfeiture Account, and the Administrator will maintain a record of the name of the deceased member.

(d) Should the estate’s representative subsequently provide an Estate Identification Number, a check will be issued to the estate, with actual earnings while invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund, from the date of transfer from the member’s account to the Suspense Account and/or Forfeiture Account. Any applicable income tax withholding shall be paid to the appropriate tax authorities at the time of the benefit payment to the estate.

(16) through (17) No change.

Rulemaking Authority 121.4501(8) FS. Law Implemented 121.091(5)(j), (8), 121.4501(20), 121.591(3), 732.802 FS. History–New 10-21-04, Amended 3-9-06, 11-26-07, 12-8-08, 1-7-10, 8-7-11, 7-12-12, 12-16-12, 10-15-13, 1-28-14, 12-30-15, 2-9-17,___________.

 

19-11.003 Distributions from FRS Investment Plan Accounts.

(1) Distributions from Investment Plan accounts are made either after the member terminates employment from all Florida Retirement System (FRS)-participating employers and meets distribution eligibility requirements as set out below in subsection (2), or after the member’s death. Monies that are rolled over from the Pension Plan Deferred Retirement Option Program (DROP) are available for immediate distribution.

(2) Distributions are available after the member terminates with all FRS-participating employers.

(a) An Investment Plan member shall not be entitled to an account distribution until the member has terminated employment from all FRS-participating employers, including temporary, part-time, Other Personal Services (OPS) and any regularly established position with an FRS-participating employer, for three (3) full calendar months following the month of termination, except as provided in paragraph (d), below. Example: If a member terminates on May 15, the three full calendar months are June, July, and August. Therefore, the member cannot request a distribution until September.

(b) If the member’s termination date has not been submitted by the employer via the monthly payroll file within three (3) calendar months, the employer can complete and return the “Employment Termination Form,” Form ETF-2, rev. 04/17 05/13, http://www.flrules.org/Gateway/reference.asp?No=Ref-08687   http://www.flrules.org/Gateway/reference.asp?No=Ref-05798, which is hereby adopted and incorporated by this reference. The termination form can be obtained by accessing the MyFRS website at MyFRS.com, clicking on Resources, and then on Forms or by calling the MyFRS Financial Guidance Line at 1(866)446-9377, Option 4 or, for members who are deaf, hard of hearing, or speech impaired, TRS 711. This form has instructions and a section for the employer to provide the member’s date of termination. Alternatively, the employer can log onto the employer page at MyFRS.com and go to Online Payroll and submit the termination date electronically.

(c) Upon the expiration of the three (3) calendar months after termination, the member may request a distribution from the Investment Plan Administrator, by calling the toll free MyFRS Financial Guidance Line at 1(866)446-9377, Option 4 (TRS 711), or by logging on to the MyFRS.com website, accessing his or her personal account information, and then requesting the distribution through the online services.

(2)(d) through (11)  No change.

Rulemaking Authority 121.4501(8) FS. Law implemented 119.07(4)(d), 121.021(29), (39), 121.091(5)(j), 121.4501(20), 121.591, 121.77, 732.802 FS. History-New 3-9-06, Amended 11-26-07, 5-19-09, 1-7-10, 8-7-11, 7-12-12, 12-16-12, 12-30-15, 4-12-17, ____________.

 

19-11.004 Excessive Trading in the FRS Investment Plan.

(1) No change.

(2) Limitations.

(a) No change.

(b) All authorized investment funds, except for money market funds and funds within the SDBA, are subject to the following controls:

1. through 3. No change.

4. Members who engage in Market Timing Trades and who have previously received a direction letter as described in subparagraph 3. above, will be sent another direction letter, delivered by courier. The direction letter will advise the member that the member will only be permitted to conduct trades involving primary funds via paper trading forms for at least three full calendar months following the date of the direction letter. The form to be used by the member in conducting the trades is the “Transfer Request Form, Excessive Fund Trading Violators,” Form EFTPV-1, rev. 08-17 06/10, http://www.flrules.org/Gateway/reference.asp?No=Ref-08700 http://www.flrules.org/Gateway/reference.asp?No=Ref-01127, which hereby is adopted and incorporated by this reference. The form will be sent to the member by the Plan Administrator with the direction letter. This form must be notarized and returned to the Office of Defined Contribution Programs, via U.S. mail, certified\return receipt requested. This form cannot be used to trade in, out or within the SDBA.

5. Members who engage in Market Timing Trades and who have previously received a direction letter as described in subparagraph 4. above, will be sent another direction letter, delivered by courier. The direction letter shall require that the member shall only be permitted to conduct trades involving primary funds via paper trading forms for at least twelve full calendar months following the date of the direction letter. The form to be used by the member in conducting the trades is the “Transfer Request Form, Excessive Fund Trading Violators,” Form EFTPV-1, rev. 08-17 06/10. This form must be notarized and returned to the Office of Defined Contribution Programs, via US mail, certified\return receipt requested.

6. Members who engage in Market Timing Trades and who have previously received a direction letter as described in subparagraph 5. above, will be sent another direction letter, delivered by courier. The direction letter will advise the member that the member will only be permitted to conduct trades involving primary funds via paper trading forms for the remainder of any time that any balance exists in the member’s Investment Plan account following the date of the direction letter. The form to be used by the member in conducting the trades is the “Transfer Request Form, Excessive Fund Trading Violators,” Form EFTPV-1, rev. 08-17 06/10. This form must be notarized and returned to the Office of Defined Contribution Programs, via U.S. mail, certified/return receipt requested.

7. If the member submits a transfer request form that is incomplete, the form will not be processed. A form is considered as “incomplete” if it does not contain the name of the member; does not set forth the social security number of the member; is not notarized; is sent by facsimile, email or regular U.S. mail; does not specify what fund(s), dollar amount(s) or percentages(s) are to be transferred; or does not indicate the fund(s) into which the amounts are to be transferred The form also will be considered “incomplete” if there are insufficent assets to execute the transfer(s), or if the requested transfer does not comply with the FRS Investment Plan Excessive Fund Trading Policy. Deficiencies are corrected through the resubmission of a transfer request form that is deemed to be complete.

8. Members who receive direction letters and who are placed on restricted trading within their primary funds, as provided in subparagraphs 2., 3., 4., 5., and 6. of paragraph (2)(b), shall be allowed to make automated trades in, out and within the SDBA. Any such member must meet the requirements of the SDBA as provided in Rule 19-11.013, F.A.C. Such member’s activity within the SDBA is not subject to this policy, but will be subject to the applicable excessive trading rules and purchase restrictions of the funds in the SDBA.

(3) through (4) No change.

Rulemaking Authority 121.4501(8) FS. Law Implemented 121.4501(13), (14), (15) FS. History–New 10-21-04, Amended 3-9-06, 10-25-07, 12-8-08, 1-7-10, 7-12-12, 6-5-14, 8-18-14, 12-30-15, 4-12-17,_____________.

 

19-11.006 Enrollment Procedures for New Hires.

(1) General Enrollment Procedures.

(a) All newly-hired Florida Retirement System (FRS)-covered employees are initially enrolled in the Pension Plan. If a newly-hired employee chooses, within the statutory election period, to enroll in the Investment Plan, or the Investment Plan Hybrid Option, the effective date of enrollment in the Investment Plan or the Investment Plan Hybrid Option is the date of hire of the employee.

(b) Eligible newly-hired employees enrolled in the Regular, Special Risk, and Special Risk Administrative Support classes may choose to enroll in the Investment Plan by submitting an enrollment form or by electronic means.

(c) Eligible newly-hired employees may enroll in the Investment Hybrid Option if they have at least five (5) years of Pension Plan service, if enrolled in the FRS prior to July 1, 2011, or at least eight (8) years of Pension Plan service, if initially enrolled in the FRS on or after July 1, 2011.

(d) Eligible newly-hired employees enrolled in the Elected Officers’ Class (EOC) or Senior Management Service Class (SMSC) may only enroll in the Investment Plan by submitting an enrollment form.

(e) Eligible newly-hired employees eligible to enroll in the State Community College System Optional Retirement Program (SCCSORP) (CCORP) or State University System Optional Retirement Program (SUSORP) may only enroll in the Investment Plan by submitting an enrollment form.

(f) Eligible State Senior Managers and Local Senior Managers eligible to enroll in the Senior Manager Service Annuity Optional Program (SMSOAP) may enroll in the Investment Plan by submitting an enrollment form.

(f)(g) Enrollment forms for eligible newly-hired employees enrolled in the Regular, Special Risk and Special Risk Administrative Support classes are available in the enrollment package which is sent to an employee’s address of record or by accessing MyFRS.com, and clicking on Resources and then on Forms; or by calling toll-free 1(866)446-9377, Option 2, or for the hearing impaired TRS 711. Enrollment forms for newly hired employees in the EOC, SMSC and newly-hired employees eligible to enroll in the CCORP are available by accessing MyFRS.com, and clicking on Resources and then on Forms; or by calling toll-free 1(866)446-9377, Option 2, or, for the hearing impaired, TRS 711.

(2) Specific Enrollment Procedures.

(a) All newly-hired employees enrolled in the Regular, Special Risk Administrative Support, EOC or SMSC classes may enroll in the Investment Plan no later than 4:00 p.m. (Eastern Time) the last business day of the 8th 5th month following the employee’s month of hire or may elect to remain in the Pension Plan. Example: If an employee is hired on January 15, the employee must complete a plan choice no later than 4:00 p.m. (Eastern Time) the last business day of September June. If no plan choice is filed by 4:00 p.m. (Eastern Time) on the last business day of September June, the employee will default to the Investment Plan Pension Plan and will be considered the employee’s initial plan choice. The amount of the employee and employer contributions paid through the date of default to the Investment Plan will be transferred to the Investment Plan and placed in an age appropriate retirement date fund.  The investment option may be changed by the employee once the account is funded.

(b) All newly-hired employees enrolled in the Special Risk class may enroll in the Investment Plan no later than 4:00 p.m. (Eastern Time) the last business day of the 8th month following the employee’s month of hire or may elect to remain in the Pension Plan. Example: If an employee is hired on January 15, the employee must complete a plan choice no later than 4:00 p.m. (Eastern Time) the last business day of September. If no plan choice is filed by 4:00 p.m. (Eastern Time) on the last business day of September, the employee will default to the Pension Plan and will be considered the employee’s initial plan choice.

(c)(b)The employee must be actively employed, earning salary and service credit when the plan choice is processed by the Plan Choice Administrator.

(d)(c) If the employee terminates employment during the plan choice enrollment window and fails to make a plan choice, he or she will be considered a newly-hired employee if returning to FRS-covered employment in the future and will be given another opportunity to make a plan choice. All previous service will be considered Pension Plan service.

(e)(d) The State Board of Administration (SBA) has designed the forms set forth below for ease of use for employees in the several membership classes of the FRS. As an alternative, an employee not wishing to use the forms may provide the same information requested by the forms available for use for the appropriate membership class in a separate document. Employees may determine their membership class by contacting the agency’s human resources office. The forms available are: an EZ Retirement Plan Enrollment Form, Form ELE-1-EZ, rev. 08/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-07617, which is only for regular, special risk, and special risk administrative support class employees; a General Retirement Plan Enrollment Form, Form ELE-1, rev. 07/17 10/16,

http://www.flrules.org/Gateway/reference.asp?No=Ref-08688 http://www.flrules.org/Gateway/reference.asp?No=Ref-07618 for regular, special risk, and special risk administrative support class employees; an Elected Officers’ Class Retirement Plan Form, Form EOC-1, rev. 07/17 10/16,  http://www.flrules.org/Gateway/reference.asp?No=Ref-08689 http://www.flrules.org/Gateway/reference.asp?No=Ref-07621; a State Community College System Optional Retirement Program (CCORP) Enrollment Form, Form OCC-1, rev. 07/17 10/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-08693 http://www.flrules.org/Gateway/reference.asp?No=Ref-07622; a State Senior Management Service Employees Retirement Plan Enrollment Form, Form SMS-1, Rev. 10/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-07623; and a Local Senior Management Service Employees Retirement Plan Enrollment Form, Form SMS-3, rev. 07/17 10/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-08694 http://www.flrules.org/Gateway/reference.asp?No=Ref-07624. All of the preceding forms are hereby adopted and incorporated by reference.

1. All enrollment forms can be obtained at the sources listed in paragraph (1)(g), above.

2. Only members of the Regular, Special Risk, and Special Risk Administrative Support classes of employees may use the EZ form, “EZ Retirement Plan Enrollment Form for Regular, Special Risk and Special Risk Administrative Support Class Employees,” Form ELE-1-EZ. If an employee chooses to use the EZ form, only limited information (i.e., name, plan choice, last four digits of the social security number, date of birth and signature) is required. An age appropriate retirement date fund as provided under the Plan provisions is the initial investment option (although that investment option may be changed by the member once the account is funded). A member’s initial beneficiary designation will be per Florida law, as provided in Section 121.4501(20), F.S. However, a beneficiary designation may be made as set forth in Rule 19-11.002, F.A.C.

(f)(e)1. The enrollment by form or electronic means shall be complete and the election shall be final if all the required information is clearly indicated and if the enrollment is received by the Plan Choice Administrator by 4:00 p.m. (Eastern Time) on the last business day of the 8th 5th month following the date of hire. The form shall be transmitted via mail, courier, online or by fax, as provided on the form. It is the responsibility of the member to ensure that the enrollment form is received by the Plan Choice Administrator no later than 4:00 p.m. (Eastern Time) on the last business day that the member is earning salary and service credit, or the last business day of the 8th 5th month following the date of hire, whichever first occurs.

2. The Plan Choice Administrator shall determine that the employee’s enrollment in the FRS Investment Plan is complete and the employee’s election is clearly indicated. If the Plan Choice Administrator determines that the enrollment is incomplete, the employee will be required to resubmit a completed enrollment. An incomplete enrollment by form is a form which is missing the name of the member, last four digits of the social security number, plan selection, or signature, or one on which the investment elections total greater than or less than 100%. If the form is incomplete only because the member has made no investment selection, the form will be processed and the member will be defaulted into an age appropriate retirement date fund as provided under the Plan provisions for investing any accumulated benefit obligation and all future contributions.  The Note that this default selection may be changed by the member at any time once the account is activated. An incomplete enrollment by electronic means is one in which the Plan Choice Administrator has no record of receipt and/or processing of the electronic enrollment.

3. By enrolling in the Investment Plan and providing a personal email address or cell phone number, the member has consented to electronic delivery of documents through the MyFRS.com website, including but not limited to prospectuses, quarterly account statements, account transaction confirmation statements, privacy notices, annual fee disclosure statement, and other documents. When one of these documents is available, an email notice will be sent to the email address or a text message to the cell phone number provided by the member notifying the member of the document’s availabilty. The member will need to log in to the MyFRS.com website in order to view and print any of these documents. Receipt of documents through MyFRS.com will continue until the member calls the MyFRS Financial Guidance Line at 1(866)446-9377, Option 4 and revokes the member’s consent.

(g)(f) Upon receipt of the completed enrollment form by the Plan Choice Administrator, the Plan Choice Administrator shall enroll the employee in the indicated FRS retirement plan. Upon completion of the enrollment, but no later than two working days after enrollment, the Plan Choice Administrator shall send confirmation of the effective enrollment to the employee at the employee’s address of record or electronically if the member has consented to electronic delivery of documents through the MyFRS.com website and to the Division to inform the Division of the employee’s retirement plan choice. The employer shall change its employee records to reflect the employee’s plan choice, if applicable.

(h)(g)Employers shall remit retirement contributions monthly for their employees and those contributions are due to the Division by the 5th working day of the month following the month for which the contributions are made.

(3) Grace Period.

(a) If a member files an election with the Plan Choice Administrator and the member realizes that the election was made in error, or if the member has reconsidered the election made, the SBA will consider, on a case-by-case basis, whether the election will be voided, if the member notifies the SBA by calling the toll-free MyFRS Financial Guidance Line at 1(866)446-9377 or by sending written correspondence directly to the SBA, to the Plan Choice Administrator, or to the Division no later than 4:00 p.m. (Eastern Time) on the last business day of the election effective month. For example, if the member files an election on June 1, the effective month will be July.  The member must request to void the election no later than 4:00 p.m. (Eastern Time) on the last business day in July.  A default election cannot be voided. 

(b) If the request to reverse the election is made timely and the SBA finds that the election was made in error, the member will be required to sign a release and return it to the SBA no later than 4:00 p.m. (Eastern Time), on the last business day of the election effective month prior to the election’s being officially reversed. The member will acknowledge that failure to return a signed release by the requested due date will result in the original election being reinstated.

(c) Upon receipt of the release, the Division and the Plan Choice Administrator will be directed to do the following:

1. The Division will revise its database to reflect the member’s plan change. The member will have until his or her choice period deadline date to make a new election. If the member’s choice period has ended, the member will have one calendar month to make a new election. Failure to make a new election will result in the member’s defaulting into the Investment Plan or Pension Plan as provided in subparagraph 2(a) and (b) above Pension Plan, except for the situation described in subparagraph 3., below.

2. The Plan Choice Administrator will send the member written confirmation that the election has been reversed.

3. If the member had elected the Investment Plan and decided to remain in the Pension Plan, there is no need for another election, because the member is already in the Pension Plan, his election to the Investment Plan having been reversed.

(d) Nothing contained in this subsection will interfere with a member’s right to file a complaint, as permitted by Section 121.4501(8)(g), F.S., and discussed in Rule 19-11.005, F.A.C.

Rulemaking Authority 121.4501(3)(c)4., (8)(a) FS. Law Implemented 121.051, 121.055, 121.35, 121.4501(2), (3), (4), (5), (6), (8), (15), 121.73, 121.74, 121.78, 1012.875(3) FS. History–New 10-21-04, Amended 3-9-06, 10-25-07, 12-8-08, 5-19-09, 2-4-10, 7-12-12, 12-16-12, 1-28-14, 8-18-14, 12-30-15, 4-12-17,____________.

 

19-11.007 Second Election Enrollment Procedures for the Florida Retirement System Retirement Programs.

(1) This rule includes procedures for members who initially chose the Florida Retirement System (FRS) Investment Plan, or the Investment Plan Hybrid Option or defaulted into the Investment Plan to use their 2nd election to transfer to the Pension Plan; and for members who chose or defaulted into the Pension Plan to use their 2nd election to transfer to the Investment Plan or the Investment Plan Hybrid Option.

(2) A member may make a valid 2nd election only if the 2nd election is made and processed by the Plan Choice Administrator during the month in which the member is actively employed and earning salary and service credit in an employer-employee relationship consistent with the requirements of Section 121.021(17)(b), F.S. Members on an unpaid leave of absence or terminated members cannot use their 2nd election until they return to FRS-covered employment. Employees of an educational institution on summer break cannot use their 2nd election during the full calendar months of their summer break. For example, if the last day of the school term is May 21st and the first day of the new school term is August 17th, the employee may not file a 2nd election in the calendar months of June or July. The beginning of the school term is determined by the employer. In general terms, this means that the 2nd election can only be made and processed during the month in which the member is actively working and being paid for that work. It is the responsibility of the member to assure that the 2nd election is received by the Plan Choice Administrator no later than 4:00 p.m. (Eastern Time) on the last business day of the month the member is actively employed and earning salary and service credit.

(a) The following are examples of scenarios that could result in an invalid 2nd election. They are only examples and are not inclusive of all possible situations. Members and employers are encouraged to contact the MyFRS Financial Guidance Line to discuss their particular situation.

1. Example 1: A member goes on unpaid leave of absence on November 12, 2015. On December 4, 2015, the Investment Plan Administrator receives a 2nd election form from the member electing to transfer from the Pension Plan to the Investment Plan. The member returns from leave of absence on January 7, 2016. The member’s 2nd election is not valid because the member did not earn salary and service credit in the month of December 2015. The member would be required to submit another 2nd election during the month in which he or she is actively employed and earning salary and service credit.

2. Example 2: A teacher is on summer break from June 6, 2014 through August 12, 2014. On July 21, 2014, the Investment Plan Administrator receives a 2nd election from the teacher electing to transfer from the Investment Plan to the Pension Plan. The teacher’s second election is not valid because the member did not earn salary and service credit in the month of July 2014. The teacher would be required to submit a second election form during the month in which he or she is actively employed and earning salary and service credit once the member has returned from summer break.

3. Example 3: A member terminates FRS-covered employment on March 31, 2016. On April 1, 2016, the Investment Plan Administrator receives a 2nd election from the member electing to transfer from the Pension Plan to the Investment Plan. The member’s 2nd election is not valid because the second election form was received after the member terminated FRS-covered employment. The member would be required to return to FRS-covered employment and submit a 2nd election form during the month in which he or she is actively employed and earning salary and service credit.

(3) General Procedures.

(a) All members who wish to change their FRS retirement plan using their 2nd election must use a 2nd election enrollment form or, if moving from the Pension Plan to the Investment Plan or Investment Plan Hybrid Option, may do so online by accessing the Second Election Choice Service at MyFRS.com. There are two types of enrollment forms. The “2nd Election Retirement Plan Enrollment Form,” Form ELE-2, rev. 07-17 10/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-08686 http://www.flrules.org/Gateway/reference.asp?No=Ref-07619, which is hereby adopted and incorporated by reference. This form allows the member to select different investment fund options if the member is changing from the Pension Plan to either the Investment Plan or the Investment Plan Hybrid Option. Alternatively, the member can complete the “2nd Election EZ Retirement Plan Enrollment Form,” Form ELE-2EZ, rev. 07-17 08/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-08685  http://www.flrules.org/Gateway/reference.asp?No=Ref-07620, which is hereby adopted and incorporated by reference. By completing this form, the member is choosing to have the employer and employee contributions and any transfers from the Pension Plan invested in an age appropriate retirement date fund as provided under the Plan provisions. The member may change the investment selection at any time after the Investment Plan or the Investment Plan Hybrid Option account is activated. Activation occurs when contributions are deposited to the member’s Investment Plan account.

(3)(b) through (i)  No change.

(j) A member enrolled in the Investment Plan as a renewed member on or after July 1, 2017 is not eligible to use the second election specified in this rule or transfer to the Pension Plan.

(4) Grace Period.

(a) If a member files an election with the Plan Choice Administrator and the member realizes that the election was made in error, or if the member has reconsidered his or her plan choice, the State Board of Administration (SBA) will consider, on a case-by-case basis, whether the election will be reversed, subject to the following: The member must notify the SBA by calling the toll free MyFRS Financial Guidance Line at: 1(866)446-9377, or by sending written correspondence directly to the SBA, to the Plan Choice Administrator, to the MyFRS Financial Guidance Line, or to the Division, no later than 4:00 p.m. (Eastern Time) on the last business day of the election effective month.

(b) If the request to reverse the election is made timely and the SBA finds the election was made in error, the member will be required to sign a release and return it to the SBA no later than 4:00 p.m. (Eastern Time), on the last business day of the election effective month prior to the election’s being officially reversed. Upon receipt of the release, the Division and the Plan Choice Administrator will be directed to take the necessary steps to reverse the election and to correct the member’s records to reflect the election reversal.

(c) A confirmation that the election was reversed will be sent to the member by the Plan Choice Administrator.

(d) The member retains the right to file a subsequent 2nd election consistent with subsections (2) and (3), above.

(e) Nothing contained in this subsection will interfere with a member’s right to file a complaint, as permitted by Section 121.4501(8)(g), F.S. and discussed in Rule 19-11.005, F.A.C.

Rulemaking Authority 121.4501(8) FS. Law Implemented 121.4501(3), (4), (8), (15)(b), (20) FS. History–New 10-21-04, Amended 3-9-06, 10-25-07, 12-8-08, 5-19-09, 1-7-10, 7-12-12, 12-16-12, 12-28-14, 8-18-14, 12-30-15, 4-12-17,____________.

 

19-11.008 Forfeitures.

(1) Forfeitures after Separation or Retirement from Florida Retirement System (FRS) Investment Plan.

(a) If a member terminates FRS-covered employment before vesting in an Investment Plan benefit or any transferred Pension Plan benefit, the member will not be entitled to any benefit, other than employee contributions, which are immediately vested. In such case, the unvested account balance will be placed in a suspense account for a period not to exceed five (5) years from the date of the member’s termination. The suspense account shall be invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund, where it will accrue actual investment earnings or losses.

(b) If the member returns to work for an FRS-participating employer in an FRS-covered position within the five (5) years from the date of termination, the member will be returned to the Investment Plan and the unvested account balance, reflecting any earnings or losses while invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund, will be returned to the member’s account, together with the associated service credit. Any additional service credit earned will be applied towards vesting of the member’s benefit.

(c) If the member never returns to work for an FRS-participating employer in an FRS-covered position or if the member returns to FRS covered employment five (5) or more years after the date of termination, the member will forfeit the unvested account balance and the associated service credit.

(d) If the member leaves FRS-covered employment after vesting in an Investment Plan benefit, but before the member vests in any transferred Pension Plan benefit, the member shall only be entitled to receive the vested Investment Plan benefit. However, if the member takes any self-initiated distribution from the vested Investment Plan benefit, the unvested Pension Plan benefit transferred into the Investment Plan, plus any earnings on these funds will be forfeited along with the associated service credit.

(e) If the member does not take a self-initiated distribution of any vested Investment Plan benefit after terminating from all FRS-participating employers, the unvested Pension Plan benefit will be transferred six (6) months following termination to a suspense account. The suspense account is invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund, where it will accrue actual investment earnings or losses. If the member returns to FRS-covered employment within five (5) years from the date of termination, the member’s benefit, reflecting any earnings or losses while invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund, will be returned to the member’s account, together with the associated service credit. Any additional service credit earned will be applied towards the vesting of the member’s benefit.

(f) If an Investment Plan Hybrid Option member leaves FRS-covered employment after vesting in the Investment Plan benefit, but before vesting in the Pension Plan benefit, the member shall only be entitled to receive the vested Investment Plan benefit. However, if the member takes any self-initiated distribution of the vested Investment Plan benefit, the unvested Pension Plan benefit will be forfeited along with the associated service credit. If the member does not take a distribution from the Investment Plan and later returns to work for a FRS-covered employer, the member will be returned to the Investment Plan Hybrid Option and the service credit for the existing Pension Plan and Investment Plan service, combined with any future service credit, will be applied towards vesting of the member’s account.

(g) If a member is required to receive a required minimum distribution (RMD), the unvested Pension Plan benefit and the associated service credit, will not be forfeited.

(h) If a member’s benefit and service are forfeited because the member did not return to FRS-covered employment within five (5) years, but the member later returns to FRS-covered employment after the forfeiture has occurred, the member will be returned to the plan in which he or she was participating at the time of the forfeiture. If the member’s benefit and service credit in the Pension Plan are forfeited because the member took a self-initiated distribution of the vested Investment Plan benefit, and the member later returns to FRS-covered employment, the member will be considered a renewed member new employee and will be entitled to renewed membership a new retirement plan choice, if applicable.

(2) Forfeitures of Investment Plan accounts Due to Criminal Activity.

(a) Any member who has been found guilty by a verdict of a jury or by the court trying the case without a jury, or who has entered a plea of guilty or a plea of nolo contendere to certain specified offenses committed prior to retirement; or any member whose employment is terminated because the member admitted committing, aiding, or abetting any such offenses; or any elected official who is convicted by the Senate of an impeachable offense, shall forfeit all rights and benefits under the FRS except for return of any accumulated employee contributions. Specified offenses are the committing, aiding, or abetting any embezzlement or theft from the member’s employer; bribery in connection with employment; any other felony specified in Chapter 838, F.S., except for commercial bribery as provided in Section 838.15 or 838.16, F.S.; committing an impeachable offense; willfully committing any felony with intent to defraud the public or the public agency which employs the member or for which the member acts, of the right to receive the faithful performance of the member’s duties while realizing or attempting to realize a profit, gain or advantage for the member or for someone else through the powers, rights, privileges and duties of the member’s office or position; committing any felony described in Section 800.04, F.S., against a victim younger than 16 years of age, or any felony described in Chapter 794, F.S., against a victim younger than 18 years of age while using or attempting to use the power, rights, privileges, or duties of the member’s office or employment position.

(b) When the State Board of Administration (SBA), becomes aware of any accusation of criminal wrong doing against any member of the Investment Plan, the SBA will place a hold on the member’s account to preclude the member from removing any money from the account, until a determination is made on whether charges have been filed and whether the charges are for a forfeitable offense.

(c) If the charges against the member are not pursued and are dropped by law enforcement officials, the hold on the member’s account will be released upon receipt of notification from the proper law enforcement agency.

(d) If the member is indicted and convicted or pleads guilty, or pleads nolo contendere, the SBA will acquire a certified copy of the judgment and will contact the member to advise the member that the Investment Plan benefit is forfeited and that the member has the right to a hearing to contest the forfeiture. The hold on the member’s account will remain in place until:

1. The time to request a hearing has passed and no request for a hearing is made, or

2. The conclusion of the hearing and any appeal of the final order issued after the conclusion of the hearing.

(e) At the conclusion of either subparagraph (d)1. above, or subparagraph (d)2. above, if the member’s hearing and/or appeal are unsuccessful, the SBA will direct the Investment Plan Administrator to transfer the member’s account balance to the Investment Plan Forfeiture Account. If such member is subsequently reemployed, the member shall be eligible for benefits based on creditable service earned subsequent to the reemployment. The member is not eligible to claim any period of employment which was forfeited.

(f) If a member has requested a self-initiated distribution of all or part of any benefit, the member shall be required to repay the benefit, if it is determined that the member forfeited all rights and benefits under the FRS. Any such member may contest the forfeiture as stated in paragraph (d), above. If the member fails to repay the benefit, the SBA may pursue all legal options.

(g) If a member receives a pardon for any crime applicable to any FRS employment, the member shall have all benefits previously forfeited returned to his or her Investment Plan account reflecting any earnings or losses while invested in the FRS Intermediate Bond Fund FIAM Intermediate Duration Pool Fund.

(3) through (4)  No change.

Rulemaking Authority 121.4501(8) FS. Law implemented 112.3173, 121.021(29), (39), 121.091(5), 121.4501(6), (13), 121.591, 732.802 FS. History–New 11-26-07, Amended 12-8-08, 7-12-12, 8-18-14, 12-30-15, 4-12-17, ______________.

 

19-11.009 Reemployment with an FRS-Participating Employer after Retirement.

(1) Reemployment.

(a)(1) If reemployed prior to July 1, 2010, a member may return to work with an FRS-participating employer after being retired for six (6) calendar months. Six calendar months means six full calendar months following the month the member retired. For example, if a member retires in January, the six calendar months are February, March, April, May, June and July. The retiree may return to employment in August. The retiree may return to employment in one of the excepted positions identified in Section 121.091(9)(b), F.S., and continue to take distributions from prior career benefits. If the retiree returns to work in a position that is not one of the exceptions allowed by law, the receipt of any remaining retirement benefits is suspended until either employment is terminated or the completion of 12 calendar months of retirement.

(b)(2)If reemployed on or after July 1, 2010, a member may return to work in any position with an FRS-participating employer after being retired for six (6) calendar months. Six calendar months means six full calendar months following the month the member retired. For example, if a member retires in January, the six full calendar months are February, March, April, May, June, and July. The retiree may return to employment in August. The member must suspend receipt of any remaining retirement benefits until either employment is terminated or the completion of 12 calendar months of retirement. Effective July 1, 2010, there are no excepted positions.

(c)(3) To prevent hiring an ineligible retiree, the employer should obtain a written statement from each prospective employee as to the employee’s retirement status. The written statement can be set forth on the “Certification Form,” Form CERT, rev. 08-17 02-12

http://www.flrules.org/Gateway/reference.asp?No=Ref-08695 http://www.flrules.org/Gateway/reference.asp?No=Ref-01067, which is hereby adopted and incorporated by reference. The form can be found on the MyFRS.com website. This form should be retained in the employee’s personnel file.

(d)(4) A retiree who returns to work with an FRS-participating employer prior to being retired for six (6) calendar months and an employer that employs or appoints such retiree are jointly and severally liable for repaying retirement benefits paid from the Investment Plan. In lieu of repayment, the member may terminate employment from all FRS-participating employers.

(2) Renewed Membership.

(a) A retiree of the Investment Plan who is reemployed with an FRS-participating employer in a covered position on or after July 1, 2010 through June 30, 2017, is not eligible for renewed membership.

(b) A retiree of the Investment Plan, Senior Management Service Optional Annuity Program (SMSOAP), State University System Optional Retirement Program (SUSORP) and State Community College System Optional Retirement Program (SCCSORP)   who is reemployed with a FRS-participating employer in a covered position on or after July 1, 2017 is a mandatory renewed member of the Investment Plan, unless employed in a position eligible for participation in the SUSORP or SCCSORP.

1. The renewed member will be enrolled in the Regular Class, unless the position meets the requirements to enroll in the Special Risk Class, Elected Officers’ Class or Senior Management Service Class.

2. Employee and employer contributions will be deposited in an account for the member and invested in an age appropriate retirement date fund.  The renewed member may move the funds once the account is activated.

3. The renewed member must satisfy the vesting requirements of the Investment Plan.

4. The renewed member or the employer may not pay any contributions for employment by the renewed member for the period of July 1, 2010 through June 30, 2017.

5. The renewed member is not eligible to enroll in the Pension Plan.

 

Rulemaking Authority 121.4501(8) FS. Law Implemented 121.021(29), (39), 121.091(9)(b), (c), 121.4501(2)(j), 121.591(1)(a)4. FS. History–New 11-26-07, Amended 12-8-08, 8-7-11, 7-12-12, 4-12-17,______________.

 

19-11.012 Rollovers or Plan to Plan Transfers to or from the FRS Investment Plan.

(1) through (5) No change.

(6)(a) The Investment Plan Administrator may accept rollovers from:

1. A current or former Investment Plan member. Such member shall use Form IPRO-1, as described in subsection (8), below.

2. Participants in the Deferred Retirement Option Program (DROP), after the conclusion of such DROP participation. Such member shall use Form IPDROP-AD-1, as described in subsection (8) below.

3. Former DROP members who had previously rolled over their DROP accumulation:

a. To the Investment Plan and subsequently rolled their DROP account balance out of the Investment Plan. Such member shall use Form IPDROP-RO-1, as described in subsection (8) below.

b. To another qualified retirement account and want to invest the DROP accumulation in the Investment Plan. Such member shall use Form IPDROP-RO-1, as described in subsection (8) below.

4. Members of the Teacher’s Retirement System and the State & County Officers & Employees Retirement System with eligible DROP proceeds after their conclusion in the DROP. Such member shall use Form IPDROP-AD-1, as described in subsection (8) below.

(b) All rollovers into the Investment Plan must be more than $1,000.00 or such amount that will cause the account balance to be greater than $1,000.00.

(c) The Investment Plan Administrator may not accept rollovers from:

1. The former spouse of an Investment Plan member who had an account in the Investment Plan, established by terms of a qualified domestic relations order and then removed all of the funds from the account.

2. The former beneficiary of an Investment Plan member who removed all of the funds from the account.

3. Members of the Pension Plan.

4. The spouse or beneficiary of a deceased Pension Plan member who had a DROP accumulation in the Pension Plan.

(7) Payment to the Investment Plan must be in the form of a check made payable to the “FRS Investment Plan – FBO (the member’s name).”

(8)(a) Instructions regarding check delivery and other information relating to the processing of rollovers, including all applicable forms, may be obtained by calling the MyFRS Financial Guidance Line, which is a toll free line: 1(866)446-9377, Option 4, or, for members who are deaf, hard of hearing, or speech impaired, TRS 711, or by accessing the website at www.MyFRS.com.

(b) Current members shall use Form IPRO-1, rev. 07-17 07/16, “Employee Rollover Deposit Instructions and Form,” http://www.flrules.org/Gateway/reference.asp?No=Ref-08698 http://www.flrules.org/Gateway/reference.asp?No=Ref-07625, which is hereby adopted and incorporated by reference, to effect rollovers described in this rule.

(c) Current DROP members planning to roll over their DROP accumulation shall use Form IP-DROP-AD-1, “FRS Investment Plan DROP Accumulation Direct Rollover Form for Current DROP Members,” rev. 07-17 07/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-08696 http://www.flrules.org/Gateway/reference.asp?No=Ref-07626, which hereby is adopted and incorporated by reference, to effect rollovers described in this rule.

(d) Former DROP members shall use Form IP-DROP-RO-1, “DROP Direct Rollover Form for Former DROP Members,” rev. 07-17 07/16, http://www.flrules.org/Gateway/reference.asp?No=Ref-08697 http://www.flrules.org/Gateway/reference.asp?No=Ref-07627, which hereby is adopted and incorporated by reference, to effect rollovers described in this rule.

(e) Current or former DROP members who roll money into the Investment Plan and who provide a personal email address or cell phone number, has have consented to electronic delivery of documents through the MyFRS.com website, including but not limited to prospectuses, quarterly account statements, account transaction confirmation statements, privacy notices, annual fee disclosure statement, and other documents. When one of these documents is available, an email notice will be sent to the email address or a text message to the cell phone number provided by the member notifying the member of the document’s availability. The member will need to log in to the MyFRS.com website to view and print any of these documents. Receipt of documents through MyFRS.com will continue until the member calls the MyFRS Financial Guidance Line at 1(866)446-9377, Option 4 and revokes the member’s consent.

(9) through (13)  No change.

Rulemaking Authority 121.4501(8), (5)(e) FS. Law Implemented 121.4501(4)(g)5., (5)(e), (21), 121.591 FS. History–New 7-12-12, Amended 12-16-12, 10-15-13, 1-28-14, 8-18-14, 12-30-15, 4-12-17,_____________.

 

19-11.013 FRS Investment Plan Self-Directed Brokerage Account.

(1) An Investment Plan member meeting certain criteria may transfer assets from the member’s Investment Plan primary investment account to a self-directed brokerage account (“SDBA”) in order to be able to access additional investment opportunities beyond the primary investment funds offered under the Investment Plan.

(a) No change.

(b) The member must open an account with the SDBA service provider in one of two ways:

1. By accessing and completing the enrollment form online by logging on to MyFRS.com, then choosing Investment Plan Manage Investments>FRS Investment Plan>Open Self-Directed Brokerage Account. The enrollment form includes both a Member Service Agreement and Memorandum of Understanding which the member must acknowledge having received and read; or,.

2. By printing and completing a hard copy of the enrollment form, Member Service Agreement and Memorandum of Understanding. A hard copy of the enrollment form can be printed from the Open Brokerage Account link on MyFRS.com or can be obtained from the Investment Plan Administrator. The member must return the completed enrollment form to the service provider via fax or mail. The member must acknowledge the Member Service Agreement and Memorandum of Understanding were received and read.

(c)3. The SDBA account will be established within two (2) days of receipt of either the online or hardcopy enrollment form. Once the account is established, the member will receive a package from the SDBA service provider containing information on how to access and use the SDBA.

(d)4. The SDBA account will be automatically closed if there is a zero balance for 18 consecutive months. To participate in the SDBA in the future, the member will have to open a new SDBA account as set forth above.

(e)(c) The member is subject to the following fees, transaction changes, expenses:

1. An annual administrative fee of $25.00 ($6.25 quarterly) for participating in the SDBA. This fee will be deducted from the member’s primary investment account for each quarter the member maintains a balance in the SDBA. This fee is in addition to all applicable commissions, sales charges and transaction fees. This fee is deducted pro rata across the member’s Investment Plan primary funds.

2. Any and all commissions, sales charges and transaction fees applicable to transactions executed by the member through the SDBA. The member may review all SDBA commissions and fees by accessing the Investment Plan Self-Directed Brokerage Account Commission and Fee Schedule in the “Investment Funds” section on MyFRS.com.

3. Depending on the investments chosen, transaction fees, commissions or sales charges may be charged to the member’s SDBA. These fees are automatically deducted from transaction proceeds or added to the purchases as they are incurred. In addition, investment management fees, 12b-1 fees, or other fees and expenses specific to individual funds may be charged to the member’s SDBA. It is the member’s sole responsibility to be aware of and understand the commissions and fees as described in the Commission and Fee Schedule and in the prospectus of any mutual fund.

(2)(a) The investment options offered through the SDBA have not been reviewed by the State Board of Administration (SBA) Florida Retirement System (FRS) for suitability for the member. The member is solely responsible for determining the appropriateness of any investments in the SDBA.

(b) The member agrees to fully indemnify and hold harmless the member’s employer, the FRS, the SBA State Board of Administration (SBA), and any and all service providers to the FRS against any claims, damages, or other possible causes of actions resulting from the member’s decision to participate in the SDBA or from the specific SDBA investment options selected by the member.

(c) The member is exercising control over all of the assets in the member’s Investment Plan account, including the SDBA, pursuant to Section 404(c) regulations and all applicable laws governing the operation of the Investment Plan. Sections 121.4501(8)(b)2. and 121.4501(15)(b) of Florida law incorporate the Federal law concept of participant control, established by regulations of the U.S. Department of Labor under Section 404(c) of the Employee Retirement Income Security Act of 1974. No program fiduciary shall be liable for any loss to the member’s account which results from such exercise of control.

(d) through (g) No change.

(3) through (6) No change.

Rulemaking Authority 121.4501(8), (5)(e) FS. Law Implemented 121.4501(8), (9), (10), (11), (12), (13), (14), (15) FS. History–New 6-5-14, 12-30-15, 4-12-17,_____________.

 

19-11.014 Benefits Payable for Investment Plan Disability and In-Line-Of-Duty Death Benefits.

(1) An Investment Plan member shall be eligible to apply for a disability benefit in accordance with Section 121.591(2), F.S., and in Rule 60S-4.007, F.A.C.

(a) Disability benefits are payable in lieu of benefits otherwise payable under Section 121.591(1), F.S.

(b) Upon approval for Investment Plan disability retirement, the member’s entire Investment Plan account balance, consisting of vested and non-vested monies, plus earnings, shall be transferred to the Division of Retirement (Division) for deposit in the disability account of the Florida Retirement System (FRS) Trust Fund.

1. The Investment Plan member will become a member of the Pension Plan effective upon his or her disability retirement effective date. If the member has a second election remaining, this transfer shall not constitute a second election as provided in Section 121.4501(4)(g), F.S.

2. The member shall receive a monthly benefit that is payable on the last business day of the month for his or her lifetime and continued disability.

(c) An Investment Plan member approved for disability retirement may cancel the application by submitting a cancellation request to the Division before a disability warrant has been deposited, cashed or received by direct deposit.

1. Upon cancellation, the member shall be transferred back to the Investment Plan.

2. All monies transferred to the disability account of the FRS Trust Fund will be transferred back to the member’s Investment Plan account.

3. The member may elect to receive benefits as provided under Section 121.591(1), F.S., in lieu of the disability benefits.

(d) If a member recovers sufficiently to return to employment from disability, the member shall be returned as an active member to the Investment Plan.

1. The member’s total disability benefits paid shall be subtracted from the amount transferred in paragraph (1)(b), above. Any remaining account balance shall be transferred to the Investment Plan Administrator for deposit into the member’s Investment Plan account. The monies will be deposited based on the member’s last investment elections.

2. Vested and non-vested amounts shall be accounted for separately as provided in Section 121.4501(6), F.S.

3. If the member does not return to employment with an FRS-participating employer, he or she may elect to receive the remaining account balance as provided under Section 121.591(1), F.S. Any non-vested amounts will be forfeited.

4. If the member does not return to employment with an FRS-participating employer and elects not to receive benefits as provided in Section 121.591(1), F.S., any non-vested amount shall be transferred to the suspense account. Such amount shall be forfeited if the member does not returned to FRS-covered employment within five (5) years of the termination date or request benefits as provided under Section 121.591(1), F.S.

(2) In Line of Duty death benefits are only available for Special Risk Class members enrolled in the Investment Plan:

(a) In lieu of receiving the member’s vested account balance as provided in Section 121.591(3), F.S., the spouse and/or unmarried child(ren) of Investment Plan members in the Special Risk Class killed in the line of duty on or after July 1, 2002 2013, may receive monthly survivor benefits equal to 100% of the member’s monthly salary at the time of death, if the Division determines that the member’s death occurred in the line of duty, in accordance with Section 121.591(4), F.S.

(b) Monthly survivor benefits provided by this subsection shall supersede any other distribution or beneficiary that may have been provided by the member’s designation of beneficiary.

(c) A hold will be placed on the member’s Investment Plan account if notification is received that the member may have been killed in the line of duty or died due to a a specified disease that occurred in the line of duty. If it is determined that the member’s death was not in the line of duty, the hold will be removed.

(d) The SBA, Division or Investment Plan Administrator will send a letter to the surviving spouse or unmarried children. The letter will include the member’s current Investment Plan account balance, estimated monthly salary at time of death, Florida Retirement System Pension Plan Application of Investment Plan Beneficiary for Special Risk In-Line-of-Duty Death Benefits, Form FST-11B-IP, incorporated by reference in Rule 60S-4.008, F.A.C., and items to submit with the completed application.

(e) The surviving spouse or unmarried children may cancel the application by submitting a notarized statement to the Division affirmatively declining the in line of duty death benefits. Once the statement is received, the hold placed pursuant to paragraph (2)(c) above, will be removed. The benefits will be distributed according to the member’s beneficiary designation. If the member did not designate a beneficiary(ies), then the member’s beneficiary(ies) will be those specified by Section 121.4501(20), F.S.

(f) Upon approval for in line of duty death benefits, the member’s entire Investment Plan account balance, including the balance of monies that may have been transferred to an account in the name of the surviving spouse or child(ren), will be transferred to the Division for deposit in the survivor benefit account of the FRS Trust Fund before monthly benefits can begin.

1. The monthly benefit payment will be actuarially reduced if the surviving spouse or child(ren) has taken any payments from the Investment Plan as a beneficiary of the member.

2. Monthly benefits will be paid to the surviving spouse for his or her lifetime or upon his or her death, to the surviving children who are under age 18 or age 25, if a full time student and unmarried. as provided in s. 121.091(7)(d) and (i).

Rulemaking Authority 121.4501(8), (5)(e), 121.5912 FS. Law Implemented 121.4501(8), (9), (10), (11), (12), (13), (14), (15), 121.591(4) FS. History–New 2-9-17,_______________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Joan Haseman, Office of Defined Contribution 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 17, 2017

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAR: August 30, 2017, Vol. 43/169