Florida
Overview
The Florida Retirement System (FRS) offers two plans for members to select as a primary benefit: FRS Pension Plan (defined benefit) and FRS Investment Plan (defined contribution). Since 2000, new employees can choose between the two plans to select as a primary benefit. The Department of Management Services, Division of Retirement (division), administers most pension and retirement benefits in the state of Florida, including a defined contribution plan for the State University System. The FRS covers general employees, public safety employees, and teachers. A separate state agency, the State Board of Administration, administers the FRS Investment Plan and manages all FRS assets.
Plan Design
State employees and teachers, and employees of local governments participating in the FRS, have the option to participate in a defined benefit or defined contribution plan. The DC plan has been the default option for new hires since January 1, 2018.
According to the US Government Accountability Office, 95 percent of employees of state and local government in Florida participate in Social Security.
Authorizing Statutes and Board Structure
FL Stat § 121.011 establishes the Florida Retirement System as a consolidation of existing retirement systems for state and county employees and teachers.
The FRS is a department of the state Department of Management Services, whose director reports to the governor. There is no board overseeing the FRS.
Details regarding the composition of these and other retirement boards is accessible via the Retirement and Investment Board Characteristics search tool located at the bottom of this page.
Fiduciary Duty/Prudence Standard
FL Stat § 215.47(c) states
Investments made by the State Board of Administration shall be designed to maximize the financial return to the fund consistent with the risks incumbent in each investment and shall be designed to preserve an appropriate diversification of the portfolio. The board shall discharge its duties with respect to a plan solely in the interest of its participants and beneficiaries. The board in performing the above investment duties shall comply with the fiduciary standards set forth in the Employee Retirement Income Security Act of 1974 at 29 U.S.C. s. 1104(a)(1)(A) through (C). Except as provided in paragraph (b), in case of conflict with other provisions of law authorizing investments, the investment and fiduciary standards set forth in this paragraph prevail.
Legal Protections of Retirement Benefits
Article I, Section 10 of the Florida Constitution provides that no law impairing the obligation of contracts shall be passed. This constitutional provision has been interpreted by the courts to protect vested pension benefits. Once an individual attains eligibility for a retirement benefit, the benefit is afforded constitutional protection. Case law interprets the impairment of contract protections in Art. I, §10 to permit only prospective adjustments to pension benefits. Florida Sheriff's Association v. Department of Administration, 408 So.2d 1033 (Fla. 1981); State ex rei. Stringer v. Lee, 2 So.2d 127 (1941); Anders v. Nicholson, 150 So. 639(Fla. 1933); O'Connell v. State Dept. of Admin, 557 So.2d 609 (Fla. App. 3 Dist. Feb. 2006)(holding that benefits vested upon attainment of normal retirement eligibility). In 2012, a state court trial judge in Williams v. Scott (Case No. 2011CA1584) struck down amendments to the state retirement system that increased the employee contribution and eliminated the COLA for future years of service. (FL CONST., Article I, §10) Source: Robert Klausner, Esq., State Constitutional Protections for Public Sector Retirement Benefits
See also the following search tools:
Retirement System Account Interest Policies | Economic Actuarial Assumptions | Retirement and Investment Board Characteristics |
Information about interest rates applied to account balances of inactive plan participants | Assumed rates of investment return and inflation | Composition and characteristics of public retirement and investment oversight boards |
Mortality Assumptions | Plan Design Features | Post-retirement Employment Policies |
Public retirement system actuarial assumptions for mortality | Numerous elements of retirement plan design | Policies governing return-to-work for retirement system annuitants |
More Data
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Population (2023) 22,610,726 |
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Florida public pension statistics, |
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Assets |
$230.2 billion |
Active Members |
716,808 |
Annuitants |
540,948 |
Benefits Paid |
$15.4 billion |
Employee Contributions |
$1.2 billion |
Employer Contributions |
$6.5 billion |
Systems |
One state system that accounts for 81 percent of assets and 87 percent of public pension plan participants in the state. The Census Bureau also reports 461 local systems. |
More Data
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Roll Call (members-only)
Other Resources
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Good News and Bad News: An Update of Florida Municipal Pension Plans' Grades, Leroy Collins Institute, May 2019
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History of Florida Retirement System