March 15, 1999 Special SupplementStephen H. Cypen, Esq., Editor
CHAPTERS 175 AND 185, FLORIDA STATUTES
Committee Substitute for House Bill 261, comprising 132 pages, makes extensive changes to Chapters 175 and 185, Florida Statutes. Governor Jeb Bush signed the Bill into law on March 12, 1999, fulfilling a campaign promise to tens of thousands of police officers and firefighters.
Section 175.021/185.01 -- makes a legislative finding that provisions of the chapter fulfill an important state interest. Clarifies that provisions are equally applicable to all participating cities and special fire control districts. Specifies that the chapter creates minimum benefits for all plans and that those minimums may not be reduced or diminished by any other local, state or federal law (other than section 112.65).
Section 175.032/185.02 -- makes section applicable to all types of plans. Adds definitions for "chapter plan," "local law plan," and "deferred retirement option plan." Defines "compensation" or "salary." Section 175.032 allows a local law plan to use a different definition of "compensation" or "salary," but only if the benefits equal or exceed what the benefits would have been using the minimum requirements for retirement (section 175.162(2)). Provides that no plan meeting requirements of the chapter shall by virtue thereof reduce or diminish the benefits.
Section 175.061/185.05 -- specifies makeup of board of trustees of chapter plans and local law plans. Has provision allowing retirees to vote in elections for board of trustees if retirees were so allowed on January 1, 1997. Clarifies that where a plan includes firefighters and police officers, one member of board shall be a firefighter and one member of board shall be a police officer, elected as provided. Finally, provides that any board of trustees operating a local law plan on July 1, 1999, 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 and a municipality or special fire control district shall enact an ordinance to implement the new board by October 1, 1999. 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 175.091/Section 185.07 -- permits member contributions to be reduced to no less than one-half of 1% (previously 1%) and allows employer to "pick up" employee contributions. Allows member contributions to be increased by their consent, in order to provide greater benefits.
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 on disbursement.
Section 175.131/Section 185.11 -- allows the municipality or special fire control district to provide authorization for the Division of Retirement to make direct deposit of the premium tax to the board of trustees. Recognizing that some employees are paid bi-weekly as opposed to monthly, provides that the employee contributions are to be deposited immediately after each pay period. Employer contributions shall be deposited at least quarterly.
Section 175.162/Section 185.16 -- makes minimum requirements for retirement applicable to all types of plans. Currently, normal retirement benefit is payable at age 55 with 10 years of service or at age 52 with 25 years of service. Current normal form of benefit is 10 years certain and life.
Section 175.191/Section 185.18 -- clarifies that employees injured in-the-line-of-duty are eligible for disability benefits regardless of length of service. Allows disability retirees to select optional forms of payment.
Section 175.195/Section 185.185 -- new sections prohibit 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/Section 185.35 -- in order to participate in distribution of the premium tax, local law plans must meet the minimum benefits and minimum standards set forth in the chapter. If in the opinion of the Division of Retirement such minimum benefits and minimum standards are met, the board, as approved by a majority of members, 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 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. Provides that premium tax shall in all cases be used in its entirety to provide extra benefits to members. Defines "extra benefits" to mean benefits in addition to or greater than those provided to general employees of the municipality. However, local law plans in effect on October 1, 1998 shall be required to comply with the minimum benefit provisions of the chapter only to the extent that additional premium tax revenues become available incrementally to fund the cost of compliance. "Additional premium tax revenues" means revenues received by a municipality or a special fire control district that exceed the amount received for calendar year 1997. Where there exists a supplemental plan, the statutory definitions of compensation or salary do not apply and the existing boards of trustees need not comply with provisions relating thereto. A "supplemental plan" means a plan to which deposits are made to provide extra benefits for firefighters or for firefighters and police officers where included; it is an element of a local law plan that exists in conjunction with a defined benefit plan that meets the minimum benefits and minimum standards of the chapter.
Section 175.381/Section 185.39 -- the act is made applicable to all municipalities, special fire control districts, chapter plans, local law municipalities, local law special fire control districts or local law plans presently existing or to be created in the future. Existing plans not in compliance with the act must comply no later than December 31, 1999. However, any plan established by special act of the Legislature shall have until July 1, 2000 to comply, except as otherwise specifically provided for establishment and election of board members.
The provisions of the act shall be construed to establish minimum standards and minimum benefit levels, and nothing contained in the act or in chapters 175 and 185 shall operate to reduce presently existing rights or benefits of any firefighter or police officer, directly, indirectly, or otherwise.
The foregoing is a summary of some of the law's provisions and is not intended to substitute for careful study of CS/HB 261 itself, which can be viewed and downloaded here. Incidentally, CS/HB261 is the first bill ever signed by Governor Bush. At the signing ceremony, the Governor asked, with some degree of seriousness, "I've never done this before -- what should I do first?" Whereupon a voice from the crowd called out: "Take the cap off the pen!" True story.
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