175.071 General powers and duties of board of trustees.—For any municipality, special fire control district, chapter plan, local law municipality, local law special fire control district, or local law plan under this chapter:
(1) The board of trustees, subject to the fiduciary standards in ss. 112.656, 112.661, and 518.11, the Code of Ethics in ss. 112.311-112.3187, and the requirements in s. 112.662, may:
(a) Invest and reinvest the assets of the firefighters’ pension trust fund in annuity and life insurance contracts of life insurance companies in amounts sufficient to provide, in whole or in part, the benefits to which all of the participants in the firefighters’ pension trust fund are entitled under this chapter and pay the initial and subsequent premiums thereon.
(b) Invest and reinvest the assets of the firefighters’ pension trust fund in:
1. Time or savings accounts of a national bank, a state bank insured by the Bank Insurance Fund, or a savings, building, and loan association insured by the Savings Association Insurance Fund administered by the Federal Deposit Insurance Corporation or a state or federal chartered credit union whose share accounts are insured by the National Credit Union Share Insurance Fund.
2. Obligations of the United States or obligations guaranteed as to principal and interest by the government of the United States.
3. Bonds issued by the State of Israel.
4. Bonds, stocks, or other evidences of indebtedness issued or guaranteed by a corporation organized under the laws of the United States, any state or organized territory of the United States, or the District of Columbia, if:
a. The corporation is listed on any one or more of the recognized national stock exchanges or on the National Market System of the NASDAQ Stock Market and, in the case of bonds only, holds a rating in one of the three highest classifications by a major rating service; and
b. The board of trustees may not invest more than 5 percent of its assets in the common stock or capital stock of any one issuing company, nor may the aggregate investment in any one issuing company exceed 5 percent of the outstanding capital stock of that company or the aggregate of its investments under this subparagraph at cost exceed 50 percent of the assets of the fund.
This paragraph applies to all boards of trustees and participants. However, if a municipality or special fire control district has a duly enacted pension plan pursuant to, and in compliance with, s. 175.351, and the trustees desire to vary the investment procedures, the trustees of such plan must request a variance of the investment procedures as outlined herein only through a municipal ordinance, special act of the Legislature, or resolution by the governing body of the special fire control district; if a special act, or a municipality by ordinance adopted before July 1, 1998, permits a greater than 50-percent equity investment, such municipality is not required to comply with the aggregate equity investment provisions of this paragraph. Notwithstanding any other provision of law, this section may not be construed to take away any preexisting legal authority to make equity investments that exceed the requirements of this paragraph. Notwithstanding any other provision of law, the board of trustees may invest up to 25 percent of plan assets in foreign securities on a market-value basis. The investment cap on foreign securities may not be revised, amended, increased, or repealed except as provided by general law.
(c) Issue drafts upon the firefighters’ pension trust fund pursuant to this act and rules prescribed by the board of trustees. All such drafts must be consecutively numbered, be signed by the chair and secretary, or by two individuals designated by the board who are subject to the same fiduciary standards as the board of trustees under this subsection, and state upon their faces the purpose for which the drafts are drawn. The treasurer or depository of each municipality or special fire control district shall retain such drafts when paid, as permanent vouchers for disbursements made, and no money may be otherwise drawn from the fund.
(d) Convert into cash any securities of the fund.
(e) Keep a complete record of all receipts and disbursements and the board’s acts and proceedings.
(2) Any and all acts and decisions shall be effectuated by vote of a majority of the members of the board; however, no trustee shall take part in any action in connection with the trustee’s own participation in the fund, and no unfair discrimination shall be shown to any individual firefighter participating in the fund.
(3) The board’s action on all claims for retirement under this act shall be final, provided, however, that the rules and regulations of the board have been complied with.
(4) The secretary of the board of trustees shall keep a record of all persons receiving retirement payments under the provisions of this chapter, in which shall be noted the time when the pension is allowed and when the pension shall cease to be paid. In this record, the secretary shall keep a list of all firefighters employed by the municipality or special fire control district. The record shall show the name, address, and time of employment of such firefighters and when they cease to be employed by the municipality or special fire control district.
(5) The sole and exclusive administration of, and the responsibilities for, the proper operation of the firefighters’ pension trust fund and for making effective the provisions of this chapter are vested in the board of trustees; however, nothing herein shall empower a board of trustees to amend the provisions of a retirement plan without the approval of the municipality or special fire control district. The board of trustees shall keep in convenient form such data as shall be necessary for an actuarial valuation of the firefighters’ pension trust fund and for checking the actual experience of the fund.
(6)(a) At least once every 3 years, the board of trustees shall retain a professionally qualified independent consultant who shall evaluate the performance of any existing professional money manager and shall make recommendations to the board of trustees regarding the selection of money managers for the next investment term. These recommendations shall be considered by the board of trustees at its next regularly scheduled meeting. The date, time, place, and subject of this meeting shall be advertised in the same manner as for any meeting of the board.
(b) For purposes of this subsection, the term “professionally qualified independent consultant” means a consultant who, based on education and experience, is professionally qualified to evaluate the performance of professional money managers, and who, at a minimum:
1. Provides his or her services on a flat-fee basis.
2. Is not associated in any manner with the money manager for the pension fund.
3. Makes calculations according to the American Banking Institute method of calculating time-weighted rates of return. All calculations must be made net of fees.
4. Has 3 or more years of experience working in the public sector.
(7) To assist the board in meeting its responsibilities under this chapter, the board, if it so elects, may:
(a) Employ independent legal counsel at the pension fund’s expense.
(b) Employ an independent enrolled actuary, as defined in s. 175.032, at the pension fund’s expense.
(c) Employ such independent professional, technical, or other advisers as it deems necessary at the pension fund’s expense.
If the board chooses to use the municipality’s or special district’s legal counsel or actuary, or chooses to use any of the municipality’s or special district’s other professional, technical, or other advisers, it must do so only under terms and conditions acceptable to the board.
(8) Notwithstanding paragraph (1)(b) and as provided in s. 215.473, the board of trustees must identify and publicly report any direct or indirect holdings it may have in any scrutinized company, as defined in that section, and proceed to sell, redeem, divest, or withdraw all publicly traded securities it may have in that company beginning January 1, 2010. The divestiture of any such security must be completed by September 30, 2010. The board and its named officers or investment advisors may not be deemed to have breached their fiduciary duty in any action taken to dispose of any such security, and the board shall have satisfactorily discharged the fiduciary duties of loyalty, prudence, and sole and exclusive benefit to the participants of the pension fund and their beneficiaries if the actions it takes are consistent with the duties imposed by s. 215.473, and the manner of the disposition, if any, is reasonable as to the means chosen. For the purposes of effecting compliance with that section, the pension fund shall designate terror-free plans that allocate their funds among securities not subject to divestiture. No person may bring any civil, criminal, or administrative action against the board of trustees or any employee, officer, director, or advisor of such pension fund based upon the divestiture of any security pursuant to this subsection.
Cited 11 times | Published | Florida 1st District Court of Appeal | 1989 WL 15937
...175.101-175.121 and 175.131-175.151, their pension funds must meet each of the following standards... ." In making the 1986 amendments, the legislature continued to identify specifically which of the provisions in chapter 175, as amended, would be applicable to local law plans. For example, section 3, chapter 86-41, amended section 175.071 to impose new restrictions and procedures on the investment of fund assets....
...n [local law plans]. (Emphasis added.) The Department's Answer Brief states, at page 21, that section 175.321, as it read during the period 1963-1986, *860 made the following sections of chapter 175 inapplicable to local law plans: sections 175.061, 175.071, 175.041, 175.091, 175.162, 175.181, 175.191, 175.251, 175.261, 175.291, and 175.301....
...As so construed, we find nothing improper about this rule and affirm the hearing officer's order rejecting appellant's challenges to it. Rule 4-54.024(3) Rule 4-54.024 relates to investments and provides in subsection 54.024(3) that, "The performance appraisal requirements of Section 175.071(5), Florida Statutes, applies to all Chapter Funds and Local Law Funds." The rule is said to implement section 175.071. The hearing officer found that the City's plans do not presently conform to the requirements in section 175.071(5). Appellants contend that rule 54.024(3) is invalid because section 175.071(5) is not intended to be applicable to local law plans but only chapter plans. The hearing officer found otherwise, specifically relying upon the invalid third prong of the Department's test. The Department has conceded that section 175.071 was not applicable to local law plans prior to 1986 (see rule 4-54.045 at p. 859, supra). We find nothing in section 175.071, as amended in 1986, or any other section of chapter 175, that clearly expresses a legislative intent that this entire section preempt the legislative authority of the City to set standards and procedures regarding investments for local law plans that may differ from those prescribed for chapter plans. The use of the word "paragraph" rather than the word "section" in paragraph 4 of section 175.071(1)(b)4, [8] discussed previously (pp. 858-859, supra), directs only that the provisions of paragraph (1) of that section, not the whole of section 175.071, be applicable to local law plans. Section 175.071 was not applicable to local law plans prior to the 1986 amendments, and there is no express statement in any part of those amendments requiring application of the remaining provisions in section 175.071 to local law plans....
...ECONOMIC IMPACT STATEMENT Appellants' remaining point on appeal challenges the sufficiency of the Department's economic impact statement accompanying the proposed rules under review pursuant to section 120.54(2). The parties stipulated, and the hearing officer found, that the application of sections 175.071, 175.081, 175.191, 175.231, 175.261, 175.333 and 175.361 to local law plans would have a significant economic impact, as defined in section 120.54, on a number of local law plans, including those of the City....
contributions made by the municipalities.9 Pursuant to section 175.071, Florida Statutes, a board of trustees under
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