Volume 3: Issue 2
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2nd Election UpdateDuring the past year an increasing number of FRS members have been using their one-time "2nd Election" opportunity to change retirement plans-nearly 1,500 just since December 2003. The topic has also become one of the most popular discussion items on the MyFRS Financial Guidance Line. To simplify enrollment and processing, we have designed a new FRS EZ 2nd Election Enrollment Form. The one-page form is available at www.MyFRS.com under the "Resources" tab, under "Forms", or employees can call the MyFRS Financial Guidance Line to request a copy. Many employees indicate they are using their 2nd Election because they are reconsidering their financial situation. However, employees also report that some investment advisors are encouraging the use of the 2nd Election. Unfortunately, it appears that some of these advisors are not objectively, accurately or comprehensively representing the decision factors that a FRS member should consider before making such an important and irrevocable decision. Additionally, some FRS members apparently rely on these investment advisors because the advisor is a provider in an employer-sponsored supplemental retirement plan (e.g., 457/403(b)/401(k)).
Please clearly communicate to employees that they have free access to objective FRS financial planners and
online resources (www.MyFRS.com) that should be consulted before any final decision
is made to switch FRS plans. You might also review the code of conduct for your supplemental retirement plan providers
in to ensure they are not acting as your agent when counseling employees on FRS plan choices.
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Timely Disability Determination ApplicationsPlease encourage Disability applicants (especially applicants with a terminal condition) to submit their completed disability application, option selection (Form FRS-11o), and to terminate in a timely manner. Unfortunately, on occasion, terminally ill applicants fail to complete the application and/or option selection forms and/or fail to terminate employment prior to their death. Under FRS law, the earliest retirement effective date a disabled retiree can receive is the month following employment termination. Therefore, if the applicant dies in the month of termination, the disability application becomes null and void, and the anticipated disability benefit to a beneficiary, generally a spouse or child, cannot be paid. The member's account would be handled as an active death case, and service (not disability) death benefit provisions would apply. Typically, the FRS has found that terminally ill applicants fail to terminate employment timely because they are in denial about their terminal condition; or they remain in employment status so they can maintain employee benefits, such as health and life insurance. Both of these situations are understandable; however, remaining in employment status can create huge negative circumstances regarding the continuing disability benefit that would have been paid to their beneficiary if they had chosen Option 2, 3, or 4. Please note that timely disability filing is important for members of both FRS retirement plans; upon a disability determination, a member of the FRS Investment Plan is placed back in the FRS Pension Plan.
Neither the FRS nor you, the employer, can force the applicant to handle all of these issues. When we are aware
of a terminal situation, we should make every effort to provide appropriate information, so the applicant can
make a proper decision.
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Deferred Retirement Option Program (DROP) Terminations
Please encourage employees who will be terminating from the DROP Program in May and June to complete their DROP
forms and return them to the Division of Retirement as soon as possible. Each year, there is a large volume of
DROP terminations during these months and timely (at least two weeks prior to termination date) submission of
DROP paperwork provides FRS staff enough time to process payments for the earliest possible payout date.
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Deferred Retirement Option Program (DROP) Extensions
District School Boards should notify the FRS of any DROP participant that will be extending his/her employment
as soon as such determination has been made. Please have form DP-EXT completed and sent to the Division of
Retirement upon approval of the DROP extension.
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Reporting Termination DatesAs the end of the school year rapidly approaches, school districts will undoubtedly have a number of employees terminating employment with their agency. It is imperative that school districts report the termination date for these employees on their monthly retirement report. Employees in the FRS Investment Plan will not be able to take a distribution of any vested account balance unless the termination date has been reported on the monthly retirement report. Employees who have their contract terminated at the end of the school year and are rehired at the beginning of the next school year should have a termination date reported on the last salary reported for this school year. The new hire date should be reported on the first salary reported for next school year. For example, if the employee?s contract termination date is June 15, 2004, the termination date of June 15, 2004 should be reported on the June retirement report (sent on or before July 5th). If the employee enters into a new employment contract on August 15, 2004, the new hire date of August 15, 2004 should be reported on the August payroll reported on or before September 5, 2004.
If you have questions about reporting termination dates or any other payroll reporting process, please contact
Hobart Lawrance with the Division of Retirement, at (850) 413-7351 [SUNCOM 293-7351].
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Employee Mailing AddressesAs the end of the fiscal year (June 30th) rapidly approaches, the FRS is preparing for the 2004 FRS Member Annual Statements (MAS) for your employees participating in the FRS Pension Plan. Additionally, a new FRS Retirement Income Forecast Statement will be mailed this year to members of both FRS Plans that projects employees' FRS and Social Security retirement benefits. In order to insure delivery of as many of these statements as possible to employees' homes, we encourage you to confirm and update employee-mailing addresses as needed in your next monthly payroll report. The sooner these changes or corrections are made, the greater the likelihood of direct delivery to the employee's home. After mailing the 2003 MAS, the Division of Retirement experienced a large increase in the number of returned MAS. Remember, undeliverable MAS will be bundled and forwarded to you for distribution to your employees. With your assistance and the cooperation of your employees, we hope to reduce the number of undeliverable MAS as much as possible. If you have any questions about reporting address changes or any other payroll reporting process, please contact the Division of Retirement Contributions Section by email at Contributions@frs.state.fl.us or by telephone at (850) 488-6011 or SUNCOM 278-6011.
The individual 2003 FRS Member Annual Statements and the summarized information in an Excel format for your employees
are still available to you for viewing, downloading, or printing. You can access this information at either
www.MyFRS.com/employer or
www.myflorida.com/frs/MAS. You should have established a password on
your first visit to this site and there is only one password per employing agency. If you have lost your password,
please contact the Bureau of Retirement Calculations by email at
Calculations@frs.state.fl.us or by telephone at (850) 488-6491 or
SUNCOM 278-6491. You will receive a separate notification from the Division after this site has been updated with
the 2004 FRS Member Annual Statements.
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Deadlines!The table below lists all the new employee FRS retirement enrollment deadlines for the next 12 months. You may wish to send your new employees a short note to remind them that their deadline will end at 4:00 p.m. Eastern Time on the date shown below.
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