Bill Text: FL S2766 | 2010 | Regular Session | Introduced

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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

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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 of other 
53  premiums, other than shift premiums, allowances, or special 
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 Code the Omnibus 
68  Budget Reconciliation Act of 1993 (the “OBRA 1993 Annual 
69  Compensation Limit”). The OBRA 1993 Annual Compensation Limit is 
70  $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 the Internal Revenue 
73  Code of 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, the OBRA 1993 Annual 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, 
82  1996, any reference in this Plan to the limitation under Section 
83  401(a)(17) of the Code shall mean the OBRA 1993 Annual 
84  Compensation 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 for 
90  earnings paid the first pay date after October 1, 2005, all 
91  mandatory Employee Contributions to the Fund shall be picked up 
92  and paid by the City. Such contributions, although designated as 
93  Employee Contributions, shall be paid by the City in lieu of 
94  contributions by the Employee. The contributions so assumed 
95  shall be treated as tax-deferred Employer “pickup” contributions 
96  pursuant to Section 414(h) of the Internal Revenue Code. Members 
97  shall not have the option of receiving the contributed amounts 
98  directly instead of having such contributions paid by the City 
99  to 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  time full 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 Employee shall 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 
142  being granted leave by the Employer for such uniformed service 
143  and termination 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 comply the 
147  Employee complies with 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 to There shall be 
172  a contribution of 7 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 Contributions Contribution. 
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 annually at a rate reflecting the Fund’s net 
220  investment 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 $90,000 limitation 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 $90,000 limitation 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 $90,000 limitation 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  $90,000 limitation 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 $90,000 
269  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 $90,000 
274  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 
297  Required 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 member an Employee shall 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 member Employee retires; or 
311         2. April 1 of the year immediately following the calendar 
312  year in which the member Employee reaches 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 an 
320  Employee’s retirement or other termination of employment, in no 
321  event shall payment extend beyond the life or life expectancy of 
322  the Employee or the joint lives or life expectancies of the 
323  Employee and the Employee’s designated beneficiary. In the case 
324  of an Employee who is receiving his or her pension benefit as of 
325  the date of his or her death, the survivor portion of the 
326  Employee’s pension benefit shall be paid at least as rapidly as 
327  under 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 Section 1.401(a)(9)-2 of the proposed Treasury 
334  regulations), 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 contrary that would otherwise limit a distributee’s (as 
342  defined 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 plan 
384  described in Section 403(a) of the Code, or a 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 member an 
399  Employee or former employee. In addition, the member’s 
400  Employee’s or former member’s employee’s surviving spouse and 
401  the member’s Employee’s or former member’s employee’s spouse 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.