March, 1997, Special SupplementStephen H. Cypen, Esq., Editor
A REVIEW OF PROPOSED AMENDMENTS TO CHAPTERS 175 AND 185, FLORIDA STATUTES
Senate Bill 524, comprising 135 pages, would make changes to Chapters 175 and 185, Florida Statutes. If enacted, the amendments would take effect October 1, 1997. The following provisions are among the most significant. All references are to Chapter 175 changes, which basically are mirrored in the changes to Chapter 185.
Section 175.021 -- adds "The minimum benefits and standards set forth in this chapter may not be diminished by local charter, ordinance, or resolution or by special act of the Legislature."
Section 175.032 -- adds definitions for "chapter plan," "local law plan," "local law municipality" and "supplemental plan," a plan to which deposits are made to provide extra benefits to firefighters, or for firefighters and police officers where included under the chapter. A supplemental plan is an element of a local law plan and exists in conjunction with a defined benefit plan that meets the minimum standards and benefits of the chapter.
Section 175.061 -- clarifies that only active firefighters vote for the two firefighter trustees, but allows retired firefighters to continue to vote therefor if so allowed by the plan on January 1, 1997. Also specifies that if plan is for firefighters and police officers, one elected member of board must be a firefighter and one must be a police officer.
Any board of trustees operating a local law plan on July 1, 1997, which is combined with a plan for general employees shall hold an election of the firefighters, or firefighters and police officers, if included, to determine whether a plan is to be established for firefighters only, or for firefighters and police officers, where included. Based on the election results, a new board shall be established as provided by the chapter. The newly established board shall take whatever action is necessary to determine the amount of assets which is attributable to firefighters, or firefighters and police officers, where included.
Section 175.071 -- the maximum investment in common stock has been increased from 30% to 50%. Again, that percentage may be varied in a local law plan and any local law provision adopted prior to July 1, 1997 which permits a greater than 50% equity investment shall prevail. And, finally, permits up to 10% of plan assets to be invested in foreign investments without restrictions.
Section 175.091 -- member contributions, which may be "picked up" by the employer, can be reduced to one-half of 1% of salary. Member contributions may be increased by majority consent of the members of the fund to provide greater benefits. Nothing shall be construed to require adjustment of member contribution rates in effect on October 1, 1997, including rates that exceed 5% of salary, provided that the minimum is met.
Section 175.122 -- clarifies that payroll amounts of members of the Florida Retirement System shall not be included in the fire department payroll for purposes of determining entitlement to the second one-half of the premium tax. Chapter 185 does not have a corresponding limitation of disbursement.
Section 175.131 -- employee contributions withheld by the employer must be deposited immediately after each pay period. Employer contributions must be deposited at least quarterly.
Section 175.191 -- for chapter plans and local law plans, in-line-of-duty disability is available from day one of membership.
Section 175.195 -- this new section prohibits false, misleading or fraudulent statements made to obtain public retirement benefits. Prohibition also applies to those who assist or conspire to obtain such benefits. Violation is a first degree misdemeanor and also subjects a convicted recipient to forfeiture of benefits.
Section 175.351 -- in order to participate in distribution of the premium tax, local law plans must meet the minimum benefits and standards set forth in the chapter. If in the opinion of the Division of Retirement of the Department of Management Services such standards are met, the board, as approved by a majority of firefighters, may either (a) place the income from the premium tax in the plan for the sole and exclusive use of firefighters, or for firefighters and police officers, where included, where it shall become an integral part of the plan and shall be used to pay extra benefits to the firefighters included in the plan or (b) place the income in a separate supplemental pension plan to pay extra benefits to firefighters, or to firefighters and police officers, where included, participating in such separate supplemental pension plan. The premium tax shall in all cases be used in its entirety to provide extra benefits to firefighters, or to firefighters and police officers, where included. For purposes of the chapter, the term "extra benefits" means benefits in addition to or greater than those provided to general employees of the municipality.
Section 175.381 -- the amendments apply to all plans in existence or created in the future. Present plans not in compliance with the amendments must so comply no later than December 31, 1997. However, as to any plan established by special act of the Legislature, compliance shall be made by July 1, 1998 (except as to creation and election of board members).
"The provisions of this act shall be construed to establish minimum standards and benefit levels, and nothing contained in this act or in chapter 175 shall operate to reduce presently existing rights or benefits of any firefighter, directly, indirectly, or otherwise."
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