Bill Text: FL S2766 | 2010 | Regular Session | Introduced
Bill Title: City of Tampa/Hillsborough County
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2010-04-30 - Died, not introduced [S2766 Detail]
Download: Florida-2010-S2766-Introduced.html
Florida Senate - 2010 (NP) SB 2766 By Senator Joyner 18-02265-10 20102766__ 1 A bill to be entitled 2 An act relating to the City of Tampa, Hillsborough 3 County; amending chapter 23559, Laws of Florida, 1945, 4 as amended; revising the General Employees’ Pension 5 Plan for the City of Tampa; revising the definitions 6 of the terms “Salaries or Wages,” “Employee,” and 7 “Military Service Time”; revising application of the 8 term “Actuarial Equivalent”; defining the term 9 “Limitation Year”; providing that all employee 10 contributions to the pension fund after a certain date 11 are mandatory and that the city shall pay such 12 contributions to the fund on behalf of the employee; 13 providing certain beneficiaries an option to roll over 14 certain death benefits; providing for a refund of 15 employee contributions; revising construction of the 16 act; allowing DROP members the opportunity to elect an 17 investment option, as determined by the board of 18 trustees, to be applied to the participant’s account 19 for the plan year entering the DROP program and for 20 each subsequent plan year; revising benefit 21 limitations; revising requirements for distribution of 22 benefits; providing a default distribution when a 23 member fails to elect a distribution option; revising 24 direct rollover options; revising the definitions of 25 the terms “eligible rollover distribution,” “eligible 26 rollover plan,” and “distributee”; providing an 27 effective date. 28 29 Be It Enacted by the Legislature of the State of Florida: 30 31 Section 1. Subsections (A), (E), (H), and (P) of section 4, 32 subsection (A) of section 5, section 19, subsection (D) of 33 section 22, subsections (A), (B), (D), (E), and (F) of section 34 24, and sections 25 and 26 of chapter 23559, Laws of Florida, 35 1945, as amended, are amended, and subsection (S) is added to 36 section 4, subsection (C) is added to section 12, and subsection 37 (C) is added to section 14 of that chapter, to read: 38 Section 4. Definitions. 39 (A) Salaries or Wages. Salaries or Wages for the purpose of 40 this Act shall be the base amounts earned by the Employee, plus 41 regular longevity bonuses, overtime, and shift premiums. Salary 42 or Wages shall also include elective amounts that are excludible 43 from the Employee’s gross income under Sections 125 (including 44 amounts that are not available to the Employee in cash in lieu 45 of group health coverage because the Employee is unable to 46 certify that he or she has other health coverage, but only if 47 the Employer does not request or collect information regarding 48 the Employee’s other health coverage as part of the enrollment 49 for the health plan); 403(b) (tax-sheltered annuity); 457 50 (Section 457 plan); and 132(f)(4) of the Internal Revenue Code 51 of 1986, as amended, and the regulations thereunder (the 52 “Code”). Salaries or Wages shall exclude, but exclusive ofother 53 premiums, other than shift premiums, allowances,orspecial 54 payments, or any casual nonrecurring or unpredictable bonuses; 55 payments for unused accrued bona fide sick, vacation, or other 56 leave; payments received by an Employee pursuant to a 57 nonqualified unfunded deferred salary or wages plan; and 58 severance pay that is paid after an Employee severs employment 59 with the City. However, Salaries or Wages, as defined herein, 60 earned but not paid to the Employee by the Employee’s severance 61 date with the City shall be considered Salary or Wages for Plan 62 purposes. In addition to other applicable limitations set forth 63 in the Plan, and notwithstanding any other provision of the Plan 64 to the contrary, for Plan Years beginning on or after January 1, 65 1996, the annual Salaries or Wages of each Employee taken into 66 account under the Plan shall not exceed the annual compensation 67 limit provided for in Section 401(a)(17) of the Codethe Omnibus68Budget Reconciliation Act of 1993 (the “OBRA 1993 Annual69Compensation Limit”). The OBRA 1993 Annual Compensation Limit is70$150,000, as adjusted by the Commissioner of the Internal 71 Revenue Service for increases in the cost-of-living in 72 accordance with Section 401(a)(17)(B) of theInternal Revenue73 Codeof 1986, as amended (the “Code”). The cost-of-living 74 adjustment in effect for a calendar year applies to any period, 75 not exceeding 12 months, over which Salaries or Wages are 76 determined (determination period) beginning in such calendar 77 year. If a determination period consists of fewer than 12 78 months, theOBRA 1993Annual Compensation Limit will be 79 multiplied by a fraction, the numerator of which is the number 80 of months in the determination period, and the denominator of 81 which is 12.For Plan Years beginning on or after January 1,821996, any reference in this Plan to the limitation under Section83401(a)(17) of the Code shall mean the OBRA 1993 Annual84Compensation Limit set forth in this provision.The limitation 85 on Salaries or Wages for an “eligible Employee” shall not be 86 less than the amount which was allowed to be taken into account 87 hereunder as in effect on July 1, 1993. “Eligible Employee” is 88 an individual who was a participant in the Plan before the first 89 Plan Year beginning after December 31, 1995.Commencing for90earnings paid the first pay date after October 1, 2005, all91mandatory Employee Contributions to the Fund shall be picked up92and paid by the City. Such contributions, although designated as93Employee Contributions, shall be paid by the City in lieu of94contributions by the Employee. The contributions so assumed95shall be treated as tax-deferred Employer “pickup” contributions96pursuant to Section 414(h) of the Internal Revenue Code. Members97shall not have the option of receiving the contributed amounts98directly instead of having such contributions paid by the City99to the Fund.100 (E) Employee. For the purposes of this Act, “Employee” 101 shall mean an Employee covered or qualified to be covered under 102 either Division A or Division B of this Plan. An Employee 103 covered by this Plan shall include all Employees, whether full 104 timefull time, part-time, or temporary, who have taken the 105 physical examination required by Section 18. Employees whose 106 Salaries or Wages are paid pursuant to a federal grant-in-aid 107 program are included in this Act only when the federal 108 government pays the employer’s contribution. Any individual who 109 is an independent contractor, or who performs services for the 110 City under an agreement that identifies the individual as an 111 independent contractor, is excluded from the Plan even if a 112 governmental agency retroactively reclassifies such individual 113 as an Employee. Casual laborers are excluded from this 114 definition as are employees covered by other City pension plans. 115 (H) Military Service Time. For members rehired after leave 116 to provide military service prior to December 12, 1994, in 117 computing Service allowance for retirement, creditable Service 118 shall, at the option of the Employee, include any service which 119 interrupted employment with the Employer, not to exceed a period 120 of 3 years, in any of the armed services of the United States 121 during time of war, upon condition that within 90 days from the 122 date of reinstatement of such Employee now or hereafter serving 123 in the armed forces, or within 90 days from the effective date 124 of this Act for those Employees already reinstated, such 125 Employee shall exercise such option by filing written notice 126 thereof with the Board of Trustees and, if a Division A 127 Employee, shall within the 12 ensuing months pay into the 128 retirement fund an amount equal to the aggregate contributions 129 such Employee would have made had such Employee not served in 130 the armed forces, based upon the Salary or Wages being earned at 131 the time of entering the armed services, and if any such 132 Employee shall fail to exercise such option within the time and 133 in the manner hereinabove prescribed, such period of military 134 service shall not thereafter be allowed as creditable Service, 135 but shall not be deemed a break in such Employee’s Continuous 136 Service eligibility period. Members rehired on or after December 137 12, 1994,Notwithstanding the foregoing, an Employeeshall be 138 credited with service for purposes of vesting and benefit 139 accrual under the Plan for his or her service in the uniformed 140 service (as defined in the Uniformed Services Employment and 141 Reemployment Rights Act of 1994, known as(the “USERR Act”) upon 142being granted leave by the Employer for such uniformed service143andtermination from employment as an Employee with the 144 Employer, provided that the Employee must return to his or her 145 employment as an Employee with the Employer within the time 146 periods prescribed by the USERR Act;and must complythe147Employee complieswith the Employee contribution requirements 148 prescribed by the USERR Act. The maximum service credit for 149 uniformed service shall be 5 years or such other time period as 150 may be prescribed by the USERR Act. Effective as of the dates 151 reflected in the Heroes Earnings Assistance and Relief Tax Act 152 (”HEART Act”), the Plan must comply with all applicable 153 provisions of the HEART Act. 154 (P) Actuarial Equivalent. The Actuarial Equivalent of an 155 Employee’s Accrued Pension shall be determined by basing 156 mortality on the 1983 Group Annuity Mortality Table for Males 157 with female ages set back 6 years and post-disablement mortality 158 upon 80 percent of the 1965 Railroad Board Ultimate Mortality 159 Table, or such other mortality tables as are in compliance with 160 the Code. This subsection does not apply to Plan Limitation 161 Years beginning after December 31, 2008. 162 (S) Limitation Year. The limitation year shall be the Plan 163 Year. 164 Section 5. Contributions. The Pension Fund shall consist of 165 moneys derived from the following sources: 166 (A) Employee Contributions. Division A Employees. 167 Commencing for earnings paid beginning with the first pay date 168 after January 1, 2005, all Employee contributions to the Fund 169 shall be mandatory Employee contributions and shall be picked up 170 and paid by the City on behalf of the member. Such contributions 171 shall be made by Employees in an amount equal toThere shall be172a contribution of7 percent of all Salaries or Wages of all 173 Employees participating in this Fund, which shall be deducted 174 from said Salaries or Wages by the Director of Finance, before 175 the same are paid, as long as the Employee continues in the 176 Service of the City of Tampa, regardless of the number of years 177 of Service with the City. Such contributions, although 178 designated as Employee contributions, shall be paid by the City 179 in lieu of contributions by the Employee. The contributions so 180 assumed shall be treated as tax-deferred Employer “pick-up” 181 contributions pursuant to Section 414(h) of the Code. Members 182 shall not have the option of receiving the contributed amounts 183 directly instead of having such contributions paid by the City 184 to the Fund. 185 Section 12. Death Benefits. 186 (C) When the designated beneficiary, as defined in Section 187 401(a)(9)(E) of the Code, is not the Employee’s spouse 188 (including, without limitation, a child, parent, or sibling), 189 distributions made after December 31, 2006, from Division A and 190 Division B shall be made in accordance with Section 402(c)(11) 191 of the Code, and such designated beneficiary shall have the 192 option to roll over all or a portion of his or her death benefit 193 via a direct trustee-to-trustee transfer to an inherited 194 individual retirement account, as defined in Section 195 408(d)(3)(c) of the Code, provided such distribution meets the 196 definition of an eligible rollover distribution as defined in 197 Section 26 of this Act. 198 Section 14. Refund of ContributionsContribution. 199 (C) Refund of Employee contributions shall be paid in 200 accordance with Section 26 of this Act. 201 Section 19. Construction. This Act shall be liberally 202 construed in accordance with general law and the federal tax 203 code, and if any part or portion thereof be declared invalid, or 204 the application thereof to any person, circumstance, or thing is 205 declared invalid, the validity of the remainder of this Act 206 shall not be affected thereby. 207 Section 22. Deferred Retirement Option Program. 208 Notwithstanding any other provisions of this Act, and subject to 209 the provisions of this section, the Deferred Retirement Option 210 Program, hereinafter referred to as the DROP, is an option under 211 which an eligible member may elect, commencing on October 1, 212 1999, to have the member’s pension benefits calculated as of a 213 certain date prior to retirement, and accumulate benefits plus 214 the investment return pursuant to this section during the DROP 215 calculation period. Participation in the DROP does not guarantee 216 employment for the DROP calculation period, as defined in this 217 section. 218 D. Interest and administrative costs. Interest shall 219 accumulate annuallyat a rate reflecting the Fund’s net220investment performance, whether positive or negative, during the 221 DROP calculation period, less the cost of administering the 222 DROP, all of which shall be determined by the Board of Trustees. 223 A DROP participant shall have the opportunity to elect, as 224 provided in this subsection, an investment option to be applied 225 to such DROP participant’s account for the Plan Year when 226 entering the DROP and for each subsequent Plan Year. In such 227 election, the DROP participant shall choose to have interest 228 accumulate annually, whether positive or negative, at either (i) 229 a rate reflecting the Fund’s net investment performance, as 230 determined by the Board of Trustees, or (ii) a rate reflective 231 of a low-risk variable rate selected annually by the Board of 232 Trustees in its sole discretion. Each election must be made at 233 such time, on such forms, and in such manner as the Board of 234 Trustees may determine in its sole discretion. If a DROP 235 participant fails to make a valid election upon entering the 236 DROP, the Fund interest rate shall be applied as provided in (i) 237 herein. If a DROP participant fails to make a valid election in 238 a subsequent Plan Year, the election for the then-current Plan 239 Year shall be applied. 240 Section 24. Limitations on Amounts of Benefits. 241 (A) For Plan Years ending after December 31, 2001, benefits 242 for an Employee under this Plan, when expressed as a benefit 243 payable annually in the form of a straight life annuity without 244 regard to the death benefit or any other ancillary benefit, 245 shall not at any time within the limitation year exceed the 246 limits provided under Section 415(b) of the Code$90,000. 247 (B)1. The$90,000limitation set forth in subsection (A) 248 shall be actuarially reduced in accordance with regulations 249 prescribed by the Secretary of the Treasury for any retirement 250 benefit that may begin before an Employee attains age 62, by 251 adjusting such benefit so that it is equivalent to such a 252 benefit beginning at age 62. For Plan Years ending before 253 January 1, 2002, and repealed for Plan Years ending thereafter, 254 the reduction shall not reduce the$90,000limitation set forth 255 in subsection (A) to less than (a) $75,000 if the benefit begins 256 at or after age 55, or (b) if the benefit begins before age 55, 257 the equivalent of the $75,000 limitation for age 55. 258 2. If any retirement benefit begins after the Employee 259 attains age 65, the$90,000limitation set forth in subsection 260 (A) shall be adjusted (based upon an interest rate assumption of 261 5 percent) in accordance with regulations prescribed by the 262 Secretary of the Treasury, by adjusting such benefit so that it 263 is equivalent to such benefit beginning at age 65. 264 (D) In accordance with Section 415(b)(5) of the Code, the 265$90,000limitation in subsection (A), and the limitation in 266 subsection (C), shall be multiplied by a fraction (not in excess 267 of 1), the numerator of which is the number of the Employee’s 268 years of Service in the Plan (in the case of the$90,000269 limitation set forth in subsection (A)) or the number of the 270 Employee’s years of Service (in the case of the limitation set 271 forth in subsection (C)) and the denominator of which, in either 272 case, is 10. 273 (E) As of January 1 of each calendar year, the$90,000274 limitation set forth in subsection (A) shall be adjusted as and 275 if permitted by the Secretary of the Treasury, and any such 276 adjusted limitation shall become effective as the maximum dollar 277 limitation under the Plan for that calendar year. The maximum 278 dollar limitation for a calendar year, as so adjusted, shall 279 apply to limitation years ending with or within such calendar 280 year. 281 (F) The following is repealed for Plan Limitation Years 282 beginning after December 31, 1999: 283 1. In the event that any Employee participates in both a 284 defined benefit plan and a defined contribution plan maintained 285 by the City, then the sum of the Defined Benefit Plan Fraction 286 (as defined in Section 415(e) of the Code) and the Defined 287 Contribution Plan Fraction (as defined in Section 415(e) of the 288 Code) for any limitation year shall not exceed 1.0. 289 2. In the event that the sum of the Defined Benefit Plan 290 Fraction and the Defined Contribution Plan Fraction exceeds 1.0, 291 then the Board of Trustees shall take such actions, applied in a 292 uniform and nondiscriminatory manner, as will keep the benefits 293 and annual additions thereto for such Employees from exceeding 294 these limits. Adjustments shall be made to this Plan before any 295 adjustments shall be required to any other plans. 296 Section 25. Latest Date of Commencement of Benefits 297Required Distributions. The distribution of a member’s benefit 298 shall be made in accordance with the following requirements, and 299 shall otherwise comply with Section 401(a)(9) of the Code and 300 the regulations thereunder, as prescribed by the Commissioner in 301 Revenue Rulings, Notices, and other guidance published in the 302 Internal Revenue Bulletin, to the extent that said provisions 303 apply to governmental plans under Section 414(d) of the Code. 304 The distribution provisions of Section 401(a)(9) of the Code 305 shall override any distribution options in the Plan inconsistent 306 with Section 401(a)(9) of the Code: 307 (A) Any benefit paid to a memberan Employeeshall commence 308 not later than the last to occur of: 309 1. April 1 of the year following the calendar year in which 310 the memberEmployeeretires; or 311 2. April 1 of the year immediately following the calendar 312 year in which the memberEmployeereaches age 70 1/2. 313 (B) Distributions of members’ benefits will be made in 314 accordance with Sections 1.401(a)(9)-2. through 1.401(a)(9)-9. 315 of the Code and such other rules thereunder as may be prescribed 316 by the Secretary of the Treasury, to the extent that said 317 provisions apply to governmental plans under Section 414(d) of 318 the Code. 319(B) In the case of a benefit payable by reason of an320Employee’s retirement or other termination of employment, in no321event shall payment extend beyond the life or life expectancy of322the Employee or the joint lives or life expectancies of the323Employee and the Employee’s designated beneficiary. In the case324of an Employee who is receiving his or her pension benefit as of325the date of his or her death, the survivor portion of the326Employee’s pension benefit shall be paid at least as rapidly as327under the method being used prior to the Employee’s death.328 (C) Notwithstanding anything contained herein to the 329 contrary, payments under the Plan to a Beneficiary due to a 330 member’s death shall satisfy the incidental death benefit 331 requirements and all other applicable provisions of Section 332 401(a)(9)(G) of the Code, the regulations issued thereunder 333(including Section1.401(a)(9)-2 of the proposed Treasury334regulations), and such other rules thereunder as may be 335 prescribed by the Secretary of the Treasury, including IRS 336 Notice 2007-7, to the extent that said provisions apply to 337 governmental plans under Section 414(d) of the Code. 338 Section 26. Direct Rollovers. 339 (A) This section applies to distributions made on or after 340 January 1, 1993. Notwithstanding any provision of the Plan to 341 the contrarythat would otherwise limit a distributee’s (as342defined below) election under this section, a distributee may 343 elect, at the time and in the manner prescribed by the 344 Commissioner of the Internal Revenue Service, to have any 345 portion of an eligible rollover distribution (as defined below) 346 paid directly to an eligible retirement rollover plan (as 347 defined below) specified by the distributee in a direct rollover 348 (as defined below). If a member fails to elect a distribution 349 option as provided under Sections 14 and 22 of this Act, then 350 such member’s benefit shall be rolled over to an individual 351 retirement account designated by the Board of Trustees, as 352 defined in Section 6. 353 (B) For purposes of this section, the following terms shall 354 have the following meanings: 355 1. An “eligible rollover distribution” is any distribution 356 of all or any portion of the balance to the credit of the 357 distributee, except that an eligible rollover distribution does 358 not include: any distribution that is one of a series of 359 substantially equal periodic payments (not less frequently than 360 annually) made for the life (or life expectancy) of the 361 distributee or the joint lives (or joint life expectancies) of 362 the distributee and the distributee’s designated beneficiary, or 363 for a specified period of 10 years or more; any distribution to 364 the extent such distribution is required under Section 401(a)(9) 365 of the Code;,and the portion of any distribution that is not 366 includable in gross income (determined without regard to the 367 exclusion for net unrealized appreciation with respect to 368 employer securities). Notwithstanding the above, a portion of a 369 distribution shall not fail to be an “eligible rollover 370 distribution” merely because the portion consists of after-tax 371 voluntary Employee contributions that are not includable in 372 gross income. However, such portion may be transferred only to 373 an individual retirement account or annuity described in Section 374 408(a) or (b) of the Code or to a qualified defined contribution 375 plan described in Section 401(a) or 403(a) of the Code that 376 agrees to separately account for amounts transferred, including 377 separately accounting for the portion of such distribution that 378 is includable in gross income and the portion of such 379 distribution that is not so includable. 380 2. An “eligible retirement rollover plan” is an individual 381 retirement account described in Section 408(a) of the Code, an 382 individual retirement annuity described in Section 408(b) of the 383 Code, other than an endowment contract;an annuity plan384described in Section 403(a) of the Code, ora qualified trust 385 (an employees’ trust) described in Section 401(a) of the Code 386 that is exempt from tax under Section 501(a) of the Code; an 387 annuity plan described in Section 403(a) of the Code; an 388 eligible plan under Section 457(b) of the Code that is 389 maintained by a state, a political subdivision of a state, or 390 any agency or instrumentality of a state or political 391 subdivision and that agrees to separately account for amounts 392 transferred into such plan from this Plan; or an annuity 393 contract described in Section 403(b) of the Code that accepts 394 the distributee’s eligible rollover distribution. However, in 395 the case of an eligible rollover distribution to the surviving 396 spouse, an eligible retirement rollover plan is an individual 397 retirement account or individual retirement annuity. 398 3. A “distributee” includes the member or former memberan399Employee or former employee. In addition, the member’s 400Employee’sor former member’semployee’ssurviving spouse and 401 the member’sEmployee’sor former member’semployee’sspouse or 402 former spouse who is the alternate payee under a qualified 403 domestic relations order, as defined in Section 414(p) of the 404 Code, are distributees with regard to the interest of the spouse 405 or former spouse. 406 4. A “direct rollover” is a payment by the Plan to the 407 eligible retirement plan specified by the distributee. 408 Section 2. This act shall take effect October 1, 2010.