Retirement (Updated 4/25/12)
Employer contribution rates to the Florida Retirement System investment plan and the State University System Optional Retirement Program have been decreased. The following table shows the differences that will take effect on July 1, 2012. Employee contribution rates are unchanged at this point in time. Additionally, a recent court ruling regarding employee contributions to state pensions was rendered unconstitutional, and is currently under appeal.
|Retirement Class||FY 2012-13|
|Regular Class - Investment||6.30%|
|Special Risk Class - Investment||14%|
|Senior Management - Investment||7.67%|
After two years, the discussion continues on the cost of State Employee benefits. Significant changes were made during the 2011 legislative session and it is likely that further changes may occur in the 2012 session. In December, the full Senate Budget Committee heard a presentation on the State of Florida Benchmarking Report: Mercer National Survey of Employer-Sponsored Health Plans. Highlights of the study included:
- Health costs continue to increase two to three times the rate of wages or general inflation, with cost increases after plan changes for Large employers in 2010 of 8.5%, predicted 6.4% in 2011.
- Cost by Size - Average National health benefit cost per covered active employee among Small employers (10-499 employees) was $8,825 as compared to $10,073 for Large employers (500+ employees)
If you would like to view the whole presentation in PDF format, click the link under Other Pertinent Documents below.
It is likely that this matter will be discussed further and that legislation and budget initiatives will follow. All updates will be provided on this page.
Filed Legislation: (Updated 4/25/12)
House Bill 525
Revises definitions of terms "normal retirement date" & "vested" or "vesting"; clarifies provisions related to prohibition of hardship loans or payments; clarifies that retiree who is reemployed in regularly established position after certain date may not be enrolled as renewed member; authorizes certain distributions to member who is terminated from employment for 1 calendar month if member has reached normal retirement date; provides rulemaking authority to DMS; provides that benefit for purposes of optional retirement program for SUS includes certain distribution; clarifies when voluntary contributions may be paid out; requires new employees to, by default, be enrolled in investment plan; authorizes new employees to elect to participate in pension plan or investment plan within specified time; revises provisions related to disability retirement benefit calculation, early retirement benefit calculation, benefit commencement age & years of service, & disability retirement benefit calculation to conform to changes made by act; provides rulemaking authority to boards of trustees for colleges; provides for contribution rate adjustments to fund benefit changes provided in act; directs Division of Statutory Revision to adjust contribution rates set forth in s. 121.71, F.S.; provides declaration of important state interest.
FINAL ACTION: Died in Committee
Committee Substitute for Senate Bill 2024
State Retirement; Providing an exception from the prohibition for reenrollment in the Florida Retirement System for a retiree who is elected or appointed for the first time; providing that certain retirees who return to covered employment are mandatory members of investment plans; specifying the age of eligibility to participate in DROP for members enrolled after a certain date; providing that a retiree who is a member of the investment plan, the State University System Optional Retirement Program, the State Community College Optional Retirement Program, or the Senior Management Service Optional Annuity Program and is reemployed between certain dates is not eligible for renewed membership in a retirement plan, etc.
FINAL ACTION: Laid on Table (refer to HB 7079)
House Bill 7079
State Retirement; Clarifies definitions of terms "normal retirement date" and "vesting"; authorizes distributions to certain members who are terminated from employment for 1 calendar month if member has reached normal retirement date; provides rulemaking authority to DMS and college board of trustees; clarifies provisions related to prohibition of hardship loans or payments; clarifies that retiree who is reemployed in regularly established position after certain date may not be enrolled as renewed member; makes conforming changes to DROP regarding deferral age; provides that benefit for purposes of optional retirement program for State University System includes certain distribution; clarifies when voluntary contributions may be paid out; specifies that definition of term "eligible employee" does not include certain members reemployed in regularly established position; clarifies when benefits may be paid out.
FINAL ACTION: Passed by Legislature and Presented to Governor for signature on 4/20/12.
Other Pertinent Documents (Adobe Reader Required)
Mercer National Survey of Employer-Sponsored Health Plans