The Issue Is Petitioner eligible to join the Florida Retirement System (FRS), Deferred Retirement Option Program (DROP)? See § 121.091(13)(a), Fla. Stat. (2001).
Findings Of Fact Petitioner is an active member of the FRS. He is an Assistant State Attorney for the Second Judicial Circuit. Petitioner is 62 years old. Petitioner was born September 17, 1941. On June 30, 1998, Petitioner visited Respondent's offices. He was assisted by Kelly Lafleur, a Benefits Specialist for Respondent. At the time of hearing Ms. Lafleur was no longer employed by Respondent. During the conversation that ensued, some discussion was had concerning Petitioner's military service and the DROP program which was to be implemented in July 1998. According to notes completed in the course of Respondent's routine business with Petitioner, as prepared by Ms. Lafleur, there was a notation in which it can be reasonably inferred that Petitioner " . . . will submit DP-11 & DP-ELE with DD-214." The comment about DP-11 and DP-ELE refers to forms that must be completed by an FRS member who wishes to participate in the DROP program. The notations made by Ms. Lafleur when Petitioner visited the Respondent included an entry which stated "approx 26.5 years, age 56." This refers to the fact that Petitioner at the time had approximately 26.5 years in credited service in the FRS and was 56 years of age. The notation concerning credited service was exclusive of military service that might be purchased to add to Petitioner's retirement benefits in the FRS. The notations made concerning Petitioner's visit with Ms. Lafleur, also stated, "will be eligible based on 30 years of service when he buys his military." This is interpreted in the context of other notations that day, to mean that Petitioner would be eligible for DROP when he purchased optional military service credit. A notation had been made on the form recording comments about the visit, which stated "could enter up to 30 years or age 62, WHICHEVER IS EARLIEST, & participate for 5 years." These remarks were struck over on the comments portion of the notes maintained by Respondent concerning the conversation between Petitioner and Ms. Lafleur. It is unclear why the notes were lined-out. The written record of the interview is reflected as Joint Exhibit numbered 5. The exhibit also reflects the address of the Petitioner as 700 Barineau Road, Tallahassee, Florida 32304. According to the written record, that address was established by a telephone call to the member, understood to refer to Petitioner. It was necessary for Respondent to obtain the home address of Petitioner to facilitate further written communication from Respondent to Petitioner. As established by the testimony of Larry Hunnicutt, Benefits Administrator for Respondent, when Petitioner met Ms. Lafleur on June 30, 1998, Petitioner was not eligible to participate in the DROP program which would begin the next day. It would have been necessary to purchase the military service to establish eligibility for DROP. Payments for that service could have been made on or before 90 days from the beginning date of the DROP period. Following the June 30, 1998 meeting between Petitioner and Ms. Lafleur, Petitioner submitted the necessary military papers to assist Respondent in determining the cost to purchase military service to be added to other service earned by Petitioner in the FRS. Joint Exhibit numbered 6 is an estimate of retirement benefits provided to Petitioner by Respondent. It is dated November 24, 1998. It contemplates the payment of $4,563 to purchase military service time to be added to existing FRS service. The amount of military service described is 3.84 years. That time added to other FRS service credit would have given Petitioner 30.47 years of service as of the moment. There is a stamp affixed to the estimate just described. The stamp has check marks placed in relation to the following categories: OPT-FRS, DROP, PREPARING TO RETIRE, and OTHER. Next to the word "OTHER" are the hand-written entries: DP-11, DP-ELE. The estimate document also included the following language at the bottom: THE AMOUNT DUE IS THE COSTS TO PURCHASE YOUR 3.84 YEARS OF MILITARY SERVICE. PLEASE COMPLETE AND RETURN THE ENCLOSED FORM, MF-1. THIS ESTIMATE IS PROVIDED FOR DROP PURPOSES AND IS BASED ON A DROP BEGIN DATE OF 11/1/98 (SEE PRINTOUT AND BROCHURE). OPTIONAL SERVICE MAY BE EXCLUDED IN THE DETERMINATION OF YOUR DROP ELIGIBILITY DATE. TO RETAIN A DROP BEGIN DATE OF 11/1/98, YOU MUST COMPLETE AND RETURN THE ENCLOSED FORMS DP-11 AND DP-ELE WITHIN 30 DAYS OF THE DATE THIS ESTIMATE WAS MAILED. The nature of the estimate reminded Petitioner that the estimate was for giving him information for DROP purposes and was premised upon a beginning date for DROP of 11/1/1998, conditioned upon the payment of the $4,563.24 for military service. The document reminded Petitioner that the optional service (military service) could be excluded in the determination of the DROP eligibility date. The document made clear that retention of the DROP begin date of 11/1/1998 was contingent upon the completion and return of the DP-11 and DP- ELE forms within 30 days of the date of the mailing of the estimate. These two forms had been referred to in the earlier conversation between Petitioner and Ms. Lafleur that took place on June 30, 1998. The document prepared establishing the estimate for DROP purposes, dated November 24, 1998, refers to a printout and brochure associated with the estimate. While it is clear that Petitioner received the estimate, the single-page document, it is not certain that Petitioner received the printout and brochure that is referred to in the document. Eventually, Petitioner decided to purchase his military service to be added to other service earned for retirement purposes. In November 2001 when Petitioner came to pay for his military service, he met Mr. Hunnicutt. At the same time Petitioner declined to upgrade his service classification for retirement pertaining to the Senior Management Service Class (SMSC). This visit with Mr. Hunnicutt was a short encounter in length of time. Principally, the payment was made for the military service credit. The participants did not engage in a further review of Petitioner's status as an FRS member. Ordinarily, had Petitioner made other inquiries concerning his status, Mr. Hunnicutt would have responded to any questions. In that context, had Petitioner asked Mr. Hunnicutt questions about DROP eligibility, Mr. Hunnicutt would have provided information about eligibility but not otherwise. On December 17, 2001, Respondent provided Petitioner a statement of his retirement account, Joint Exhibit numbered 3. That statement of account indicated in relevant part: We audited your retirement account and you have 33.56 years of service through 11/2001. The amount due for your military service has been paid in full. Per your request, we have removed your SMSC upgrade and the corresponding amount due from your account. That document made no mention of DROP eligibility. Petitioner came back to Respondent's office in May 2003 and while he was there he spoke to Mr. Hunnicutt. At that time Petitioner made mention that he believed that he was in the DROP program, notwithstanding that he had never submitted the DP-11 and DP-ELE forms that were required to participate in DROP. Petitioner commented that he was not aware of the required forms. Mr. Hunnicutt was introduced into the conversation after Petitioner spoke to some other person in Respondent's office. Petitioner made it obvious in the conversation that he still had an interest in DROP participation, even if Respondent was persuaded that he was not enrolled in DROP from Respondent's point-of-view. As of the date that the discussion was held with Mr. Hunnicutt, apparently May 14, 2003, Respondent held to the view as expressed by Mr. Hunnicutt, that Petitioner was no longer eligible to participate in DROP, having failed to timely elect that option. On May 14, 2003, Mr. Hunnicutt believed and continues to hold the opinion, that Petitioner's outside date for electing to participate in DROP, excluding military service, expired on March 31, 2003. During the May 14, 2003 meeting between Petitioner and Mr. Hunnicutt, it was explained by Mr. Hunnicutt that Petitioner had rights to appeal a decision denying the right to participate in DROP. Joint Exhibit numbered 4 contains the notations by Mr. Hunnicutt concerning the May 14, 2003, conversation between Mr. Hunnicutt and Petitioner, kept by the Respondent as part of its routine business. It highlights those facts that have been found on this occasion. On May 14, 2003, Petitioner wrote Mr. Hunnicutt to make his case for eligibility to participate in DROP. This correspondence was met by the May 27, 2003, correspondence from Erin B. Sjostrom, State Retirement Director, formally denying Petitioner his right to participate in DROP, while stating the grounds for that denial. The two pieces of correspondence are Joint Exhibits numbered 2 and 1, respectively. Petitioner in his testimony stated his belief, that at the point in time where he paid for his military service to be added to his other FRS service time, that he was automatically in DROP without having to take further action to enroll. Petitioner in his testimony explains his impression of events by commenting that he was told about DROP benefits when he was not already eligible to participate in the DROP program (having not paid for military service), and he was not told of his right to participate in the DROP program when he was eligible (having paid for military service).
Recommendation Upon consideration of the facts found and Conclusions of Law reached, it is RECOMMENDED: That a Final Order be entered denying Petitioner's right to participate in the DROP program. DONE AND ENTERED this 13th day of April, 2004, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of April, 2004. COPIES FURNISHED: Jack L. Poitinger, Jr., Esquire 700 Barineau Road Tallahassee, Florida 32304 Robert R. Button, Esquire Department of Management Services Division of Retirement 4050 Esplanade Way, Suite 260 Tallahassee, Florida 32399 Alberto Dominguez, General Counsel Department of Management Services Division of Retirement 4050 Esplanade Way Tallahassee, Florida 32399-1560 Sarabeth Snuggs, Interim Director Division of Retirement Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-1560
The Issue Whether Petitioner is entitled to purchase leave of absence retirement credit on behalf of James Gapinski, Petitioner's ex- husband and a deceased member of the Florida Retirement System.
Findings Of Fact Petitioner, Geraldine Gapinski, is the former spouse of James Gapinski, deceased. At the time of his death, Mr. Gapinski was an employee of Florida State University and a "vested" Florida Retirement Service (FRS) member. Petitioner is an employee of the Florida Department of Law Enforcement (FDLE) and an active member of FRS. Mr. Gapinski was continuously employed by Florida's Univeristy System from approximately 1970, until his death on November 20, 2000, with the exception of a period from September 10, 1976 to June 9, 1977, during which period he took an approved leave of absence. During the period September 10, 1976 to June 9, 1977, no contributions were made by Mr. Gapinski or on Mr. Gapinski's behalf to FRS toward his accruing retirement benefits and he earned no creditable service in FRS for this eight month period he was on his leave of absence. On May 4, 2000, Mr. Gapinski requested an audit and estimate of retirement benefits from Respondent. At the time of his request for an audit and estimate, Mr. Gapinski and Petitioner had begun a dissolution of marriage proceeding (divorce). At all times material, each litigant had independent legal counsel, and each lawyer was aware that Mr. Gapinski's FRS benefits were "on the table" for division of the marital estate in the course of the divorce proceedings. At all times material, Mr. Gapinski was terminally ill with cancer. On September 14, 2000, Mr. Gapinski applied for participation in the Deferred Retirement Option Program (DROP). His application (DROP Form DP11) requested a DROP "begin date" of September 1, 2000, and designated each of Mr. Gapinski's two adult daughters as 50 percent primary beneficiaries. Petitioner, who at that time was still married to Mr. Gapinski, was not even designated a secondary beneficiary. The application, which Mr. Gapinski signed, stated in pertinent part, I understand that the earliest date my participation in the DROP can begin is the first date I reach my normal retirement date as determined by law . . . I cannot add additional service, change options, or change my type of retirement after my DROP begin date (emphasis in original). The application also specified eight required acts before Mr. Gapinski could retire and become a DROP participant, including, but not limited to, 4. A check payable to FRS for any amount you owe, or a written statement that you do not wish to claim the service . . . . On September 15, 2000, Respondent provided James Gapinski with two estimates of benefits. Estimate No. 1 showed the benefit Mr. Gapinski would be entitled to if he chose to purchase the one year leave of absence for $6,820.52, providing for a DROP beginning date of September 1, 2000. This estimate further advised that 6.5 percent per annum would be posted on June 30, 2001. It also stated, Comments: The amount due is to purchase service for your leave of absence from September 10, 1976 to June 9, 1977. This amount must be paid for a DROP begin date of September 1, 2000. Mr. Gapinski was also notified of the need to purchase his leave of absence credit in a letter from Respondent dated September 15, 2001, stating, in pertinent part, as follows: The following items are pending. The amount due is to purchase service for your leave of absence from September 10, 1976 to June 9, 1977. If you do not elect to pay the above amount due and purchase the service it represents, we must have written notification of your intent. * * * Completion of the Option Selection for FRS members, . . . AFTER YOUR FIRST MONTH OF DROP PARTICIPATION YOU CANNOT ADD ADDITIONAL SERVICE, CHANGE OPTIONS, CHANGE YOUR DROP BEGIN DATE OR CHANGE YOUR TYPE OF RETIREMENT. * * * Estimate No. 2 sent to Mr. Gapinski on September 15, 2000, showed the benefit Mr. Gapinski would be entitled to if he chose not to purchase his leave of absence and waited until March 1, 2001, to participate in DROP, when he would accrue 30 years of service without counting the gap left by his 1976-1977 leave of absence. This estimate also stated: Comments: This estimate does not include the purchase of your leave of absence and is provided for comparison purposes. It is provided for DROP purposes with a March 1, 2001, DROP begin date (see the enclosed DROP brochure). If you do not elect to pay the amount due and purchase the service it represents, we must have written notice of your intent. Apparently, neither attorney ever saw any of the foregoing papers. The thrust of Petitioner's attorney's actions and advice was to obtain survivorship retirement benefits, not necessarily DROP benefits, for Petitioner. On October 23, 2000, Petitioner's attorney was told by telephone by Ms. Ferguson, a representative of Respondent, that Petitioner must make a non-party request to release Mr. Gapinski's retirement information to her. So far as this record shows, no third party request was ever made, but that day, Petitioner's attorney and Ferguson also generally discussed retirement pay-out options that Mr. Gapinski could elect, and Petitioner's attorney was generally aware that the DROP process was not complete. On October 24, 2000, Petitioner's attorney discussed by telephone, retirement, divorce, and survivorship benefit issues and life insurance payment options with Ms. Hudson, a representative of Respondent. On October 26, 2000, Petitioner's attorney discussed, by telephone, retirement options and steps to be taken, with both Ms. Ferguson and Mr. Helms, another of Respondent's representatives. Mr. Helms told her the DROP application was not complete but if the couple were still married, Option No. 3 would give the most benefit for survivorship benefits. During the October 2000, conversations, Petitioner's attorney made each of Respondent's representatives aware of the impending divorce and of Mr. Gapinski's impending death, but the attorney did not specifically inquire how soon the lapsed time payment must be made and none of Respondent's representatives volunteered information on that issue. At Mr. Gapinski's request, the divorce proceeding was bifurcated. Prior to the divorce, Petitioner's attorney had done independent research and was aware that Mr. Gapinski had to pay the $6,820.52, in order to perfect the DROP program and in order to complete 30 years of creditable service in order to be eligible for survivorship benefits on his retirement. This information was communicated to Petitioner by her attorney and whether or not Petitioner would be willing to pay half the amount was discussed. Petitioner stated she would be willing to pay half the amount owed. As a condition to her agreement to bifurcate the divorce proceeding, that is, as a condition to letting Mr. Gapinski out of the marriage but reserving jurisdiction in the Circuit Court to resolve certain disputes concerning assets and entitlements, Petitioner required that the couple enter into an "Agreement" on October 27, 2000, which provided, in pertinent part, as follows: BIFURCATION: The Husband shall be entitled to bifurcation of the dissolution action. The marriage of the parties shall be dissolved with the Court reserving on all remaining unresolved issues not addressed in this agreement. In light of the Husband's health, the Wife shall schedule and appear at an ex parte hearing to dissolve the marriage, to obtain Court-ordered approval of this agreement, and to ensure the Court's reservation of jurisdiction to hear any and all issues pertinent to support and the division of property not yet settled by the parties. * * * B. The Wife further agrees that all marital assets awarded to her in this cause (including proceeds from the Husband's retirement and life insurance in the event the Husband predeceases her), shall be placed in an inter vivos trust, from which she may draw living, personal, and medical expenses, during her life, with the parties' adult daughters named as the irrevocable beneficiaries of the remainder of such trust. C. The Husband agrees to bequeath sufficient marital assets, awarded to him in this cause, to the parties' adult daughters to aid in their comfort and support. HUSBAND'S RETIREMENT: The Husband shall elect an option on his retirement with the State of Florida that provides for survivorship benefits for the benefit of the Wife. The wife shall be entitled to all such retirement survivorship benefits which, like the other assets she receives in this bifurcated action, shall be placed in an inter vivos trust for her living, personal and medical expenses, during her life, with the adult daughters as irrevocable beneficiaries of the remainder of the trust. The Husband shall, simultaneously with the signing of the agreement, execute such documents as are necessary to create retirement survivorship benefits in accordance with this term. Should the Husband fail to execute the survivorship option on his retirement or should he ever change such option in contravention of this term, the Husband agrees that the obligation of this term is binding upon his estate, which estate shall be responsible for paying such retirement survivorship benefits to the Wife. The Agreement could have, but did not, specifically require that the leave of absence be purchased by either Mr. Gapinski or Petitioner. Petitioner's and Mr. Gapinski's Agreement does not bind the Respondent, which was in no way privy to that Agreement. Petitioner and Mr. Gapinski's marriage was dissolved on November 1, 2000. Petitioner's attorney provided Mr. Gapinski, through his counsel, with DROP forms (FST-12 and FRS-11o). On November 1, 2000, Mr. Gapinski executed Option 2 for his DROP retirement on these forms, naming Petitioner as his sole primary beneficiary and negating his prior designation of his adult daughters as beneficiaries. Option No. 2 provides for a reduced monthly benefit payable for the FRS member's (Mr. Gapinski's) lifetime. If the member dies before receiving 120 monthly payments, his designated beneficiary (Petitioner) would receive a monthly benefit in the same amount until the monthly benefit payments to both of them equaled 120 monthly payments, when payments would terminate. Option No. 2 is available for regular service retirements as well as DROP retirements. Option No. 3 is also available for regular service retirements and DROP retirements. Option No. 3 would have provided a reduced monthly benefit payable for Mr. Gapinski's lifetime, and upon his death, his joint annuitant, if living, would receive a lifetime monthly benefit payment in the same amount as Mr. Gapinski was receiving. Then, no further benefits would be payable after both he and his joint annuitant were deceased. There are exceptions to the foregoing general description, none of which matter to the case at bar. Option No. 3 would clearly provide more money to Petitioner if she were eligible. On November 2, 2000, Petitioner's attorney had three short telephone conversations with Mr. Helms, who opined that since Mr. Gapinski had signed up for DROP while the couple were still married, Petitioner could still get Option No. 3, with DROP retroactive to September 1, 2000, but that the leave of absence must be paid for. Apparently, Petitioner's attorney did not ask what would happen if the gap was not paid for before Mr. Gapinski died and no representative of Respondent volunteered that information. The thrust of Petitioner's case continued to be to persuade Mr. Gapinski to pay the whole amount due and to change his Option election to No. 3. On or about November 3, 2000, Mr. Helms sent an estimate letter based on selecting a September 1, 2000, retirement date with Option No. 1, to Mr. Gapinski. This estimate letter stated Mr. Gapinski had 30.11 years of creditable service. It did not mention DROP or any pay back. It did state that no lump sum retirement or cash value payments were available. (Second page of attachment to Exhibit P-11). On November 3, 2000, Petitioner's attorney wrote Mr. Gapinski's attorney that Mr. Gapinski was considered by Respondent to be in the DROP program as of September 1, 2000, not March 1, 2001, as supposed before the divorce, but he had not bought back his leave by paying $6,820.52, and requested that Mr. Gapinski change his Option Election Form to Option No. 3 and authorize the payment of the $6,820.52 to Respondent. On or about November 9, 2000, Petitioner's attorney sent the already-executed FST-12 (Beneficiary Designation Form) and FRS-11o (Option Selection for FRS Members) showing Option No. 2 to Respondent. Mr. Helms acknowledged receipt. On or about November 9, 2000, Mr. Helms told Petitioner's attorney that the forms were correct and anyone could pay the $6,820.52. The attorney felt Mr. Gapinski was enrolled in DROP but that the $6,820.52 was still needed. On November 15, 2000, Petitioner's attorney sent Mr. Helms a letter memorializing their conversation, in which Mr. Helms had indicated it was not necessary for Petitioner to sign below the Option No. 2 selection paragraph on FRS 11o as long as she was aware of the option Mr. Gapinski had selected. On November 20, 2000, Mr. Gapinski passed away without anyone having purchased his leave of absence credit. Mr. Gapinski was only 57 years of age when he died. DROP retirement or regular service retirement with full benefits is possible at 62 years of age or upon attaining 30 years of creditable service. Mr. Gapinski remained in regular employment until his death. Because he had not purchased the leave of absence credit, Mr. Gapinski died with only 29 years and 9 months of creditable service for purposes of retirement. In other words, he was 3 months and ten days short of the 30-year retirement mark necessary to activate DROP or regular service retirement. Petitioner never communicated directly with Respondent until after Mr. Gapinski's death. Mr. Gapinski's will provided for the effective disinheritance of Petitioner to the extent provided by law. On December 14, 2000, Petitioner's attorney spoke by telephone with Mr. Helms, who told her he thought Petitioner could still pay the leave of absence money but he would call her back. On December 15, 2000, Stanley Colvin, another of Respondent's representatives, telephoned Petitioner's attorney to say Petitioner could not pay the amount after Mr. Gapinski's death. At no time prior to Mr. Gapinski's death did any representative of Respondent affirmatively represent to anyone that Petitioner could pay the money after Mr. Gapinski's death or the conditions under which no benefits would be paid or specifically what would happen if Mr. Gapinski died before the money was paid by someone. By a December 15, 2000, letter, Respondent notified Petitioner that since Mr. Gapinski had elected not to purchase the leave of absence, he could not have reached the required 30 years of service necessary to participate in the DROP program until March 1, 2001. It further stated that since Mr. Gapinski's death occurred before completion of the required months necessary to participate in DROP, his DROP application was cancelled and his choice of Option No. 2 was nullified. Moreover, Mr. Gapinski was viewed as an active FRS member on the date of his death, and because Petitioner, though designated as his beneficiary was not also a joint annuitant, she could only receive a refund of Mr. Gapinski's retirement contributions in the amount of $4,719.19,and was not eligible to receive Option No. 3. Respondent did not send a similar letter to prior beneficiaries, the decedent, or his estate/personal representatives. Petitioner requested a review, and on February 2, 2001, Respondent issued its proposed final agency action letter, to the same effect as the December 15, 2000, letter. Respondent did not send a similar proposed final agency action letter to prior beneficiaries, the decedent, or his estate/personal representatives. However, the undersigned notes that Mr. Gapinski's adult daughters, who also were his joint personal representatives, were present in the courtroom on September 24, 2001, the first day of hearing. As of the second day of hearing on October 21, 2001, the estate had been closed and the personal representatives had been discharged. Mr. Larry Hunnicutt, Benefits Administrator for the Bureau of Retirement Calculations, Division of Retirement, testified by deposition. He indicated that Respondent Division of Retirement has no rules in place specifically addressing DROP. Therefore, in DROP cases, Respondent interprets and applies Chapter 121, Florida Statutes, and the existing rules addressing regular service retirement. In practice, Respondent gives DROP applicants a 90-day grace period from the date of application in which to finalize all the outstanding documents or other requirements for DROP eligibility, including payments of amounts due, even though there are no provisions in place authorizing a grace period for DROP applicants. If there are money amounts due, the member must pay up during this period. If the member fails to pay up during this period, the DROP application and the option selected for DROP is cancelled by a certified letter, but the designated beneficiary remains intact. Herein, because the amounts were not paid before Mr. Gapinski died, and because it would serve no purpose to notify the decedent, who could no longer complete his DROP requirements, Respondent did not send the deceased member a cancellation of his DROP application and Option No. 2 selection. Rather, it treated the DROP application and option selection as null and void and notified his ex-wife, the designated beneficiary, of what Respondent understood to be her rights. In this notification, Respondent applied the statutes as its personnel understood them to apply to a member who dies in active service prior to reaching either 62 years of age or 30 years of creditable service. Respondent would have permitted Petitioner to pay the money on Mr. Gapinski's behalf only during his lifetime. If the amount due had been paid, and Petitioner were qualified for Option No. 2, she would receive approximately $500,000 plus cost of living increases as opposed to $4,719.19. She would receive considerably more if she qualified for Option No. 3.
Recommendation Upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Management Services, Division of Retirement enter a final order denying Petitioner's request to purchase leave of absence credit on the account of James Gapinski. DONE AND ENTERED this 14th day of December, 2001, in Tallahassee, Leon County, Florida. ELLA JANE P. DAVIS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of December, 2001.
The Issue Whether Petitioner’s employment with Respondent terminated on May 31, 2003, or whether Petitioner continued to be employed by Respondent during the next calendar month.
Findings Of Fact Petitioner Babu Jain was hired by Florida Agricultural and Mechanical University (FAMU) as a physics professor in September, 1967. He became an associate professor with tenure in 1979 and a full professor in 1996. The exact date of his last day of employment is a central issue in this case. In 1998, Dr. Jain learned of the DROP program. After reviewing written materials regarding DROP for nearly a year, Dr. Jain decided to join DROP in 1999. He executed Forms DP-11 and DP-ELE, indicating his election to participate in DROP. Form DP-ELE is entitled, "Notice of Election to Participate in the Deferred Retirement Option Program (DROP) and Resignation of Employment." Form DP-ELE includes the following: "RESIGNATION FROM EMPLOYMENT TO PARTICIPATE IN THE DROP - I elect to participate in the DROP in accordance with Subsection 121.091(13), Florida Statutes . . . and resign my employment on the date I terminate from the DROP." The form contains Dr. Jain’s notarized signature below the following: "I understand that I must terminate all employment with FRS employers to receive a monthly retirement benefit and my DROP benefit under Chapter 121, F.S." Dr. Jain signed the form on October 12, 1999. The bottom portion of Form DP-ELE is to be completed by the agency head or designated representative. Within that portion of the form, the signature of Nellie Woodruff, Director of Personnel Relations at FAMU, appears following an acknowledgement: "I acknowledge that DROP participation for Babu L. Jain will begin on 06/01/1999, and I accept his resignation effective 05/30/2003 (the date the employee’s DROP participation will terminate)." This portion of the form indicates that it was signed by Ms. Woodruff on November 10, 1999. Sometime in the early part of 2003, Dr. Jain, for personal and financial reasons, decided that he wanted to relinquish his participation in DROP. He was aware that if he did so, he would forfeit all accumulated DROP moneys. Dr. Jain first relayed his desire to FAMU by verbally informing Dr. Henry Williams, the Assistant Dean of the College of Arts and Sciences, who was in charge of science departments. This conversation took place in approximately mid-February, 2003. On March 18, 2003, Dr. Jain sent a letter to Dr. Larry Rivers, Dean of the College of Arts and Sciences, which read in pertinent part as follows: This letter is in connection with my 1999 DROP application. I would like to inform you that I am finding my circumstances very unfavorable to accept the DROP at this time and, hence, I will not be taking the retirement in May 2003. Dr. Jain sent a copy to, among others, Dr. Gladys Lang, who was the Acting Provost and Vice President of Academic Affairs at that time. She did not take any action regarding Dr. Jain’s letter because it was her understanding and belief that no action was necessary. It was her understanding and belief that that Dr. Jain notified the University of his decision to withdraw from DROP and that no action was necessary on her part, "because I believed that the participants in DROP could make that decision that they wanted to continue to work and did not want to continue in the DROP program. I did nothing." She considered her decision not to take any action on Dr. Jain’s letter to be an acceptance of his decision. However, Dr. Lang acknowledged that had the letter been addressed to her, rather than her receiving a copy of it, she would have responded. Dr. Jain did not receive any response to his March 18, 2003, letter to Dr. Rivers. Because of this, Dr. Jain wrote again to Dr. Rivers on April 18, 2003, in which he reiterated that he did not want to retire in May 2003. Dr. Jain received a Termination Notification Form, Form DP-TERM, from the Division of Retirement in February 2003. Form DP-TERM specifies that it must be completed by both the DROP participant and the employer. It reads in pertinent part as follows: According to our records, your DROP termination date is 05/31/03. This form must be completed by both you and your employer and returned to the Division of Retirement in order to receive your DROP benefits and your monthly retirement benefits. In order to collect DROP, you must agree to the following statements. I understand that I cannot accept work for any Florida Retirement System (FRS) covered employer during the calendar month following my DROP termination date or my DROP participation will be null and void. If I fail to meet this requirement, I will forfeit my accumulated DROP benefit including interest. I also understand that I may not be reemployed by any FRS employer in any capacity . . . during the calendar month immediately following my DROP termination date. If I fail to meet this requirement, I will forfeit my accumulated DROP benefit, including interest retroactive to my enrollment date in DROP. I understand that if I forfeit my DROP benefit, my employer will be responsible for making retroactive retirement contributions and I will instead be awarded service credit for the time period during which I was in DROP. I will be eligible for a service retirement benefit based on my new termination date. I will be responsible for submitting an Application for Service Retirement. My retirement benefit will be based on my creditable service and salary, including such service and salary earned while in DROP. Dr. Jain did not sign Form DP-TERM. It is not clear from the record whether FAMU was even aware that Dr. Jain received this form. In any event, the portion of the form which is to be completed by the employer certifying that the employee has or will terminate employment is not signed by anyone from FAMU. Dr. Bill Tucker is a faculty member of the physics department and is president of the FAMU chapter of the United Faculty of Florida. On or about April 19, 2003, Dr. Tucker met with Dr. Rivers regarding Dr. Jain’s intention not to retire. Dr. Tucker left that meeting with the impression that Dr. Rivers had accepted Dr. Jain’s decision to remain a faculty member at FAMU and not retire in May 2003. Following that meeting, Dr. Jain wrote a letter dated April 21, 2003, to Dr. Rivers thanking him for his support and understanding the he, Dr. Jain, had decided not to retire. The letter also reminded Dr. Rivers that Dr. Mochena had not yet given him his 2003-2004 assignment of responsibilities, and requested that Dr. Rivers ask Dr. Mochena to do so at his earliest opportunity. Dr. Rivers did then call Dr. Mochena regarding preparing a schedule for fall semester for Dr. Jain. Dr. Mochena described the call as a "very quick call." As a result of that call, Dr. Mochena issued an Assignment of Responsibility Form on April 23, 2003, for Dr. Jain for the fall 2003 semester. While Dr. Rivers insisted at hearing that his intention was that Dr. Jain be assigned teaching duties on an adjunct basis, he acknowledged, and Dr. Mochena confirmed, that the assignment of responsibilities for Dr. Jain for fall of 2003 was not of a type that would have been given to an adjunct professor. Sometime after April 23, 2003, Dr. Jain asked Dr. Mochena to assign him teaching responsibilities for the summer of 2003. Dr. Mochena had already made his summer teaching assignments. He assumed, however, that since Dr. Jain was being assigned fall classes, that it was it would be appropriate to assign summer classes to Dr. Jain as well. On May 2, 2003, Dr. Mochena issued an Assignment of Responsibility Form for Summer Term "C" 2003, which was for 12 weeks. This was signed by Dr. Jain and Dr. Mochena on May 2, 2003. While Dr. Mochena's assignment of summer teaching responsibilities to Dr. Jain was as a result of Dr. Jain’s request and not at the request of the Dean’s office, Dr. Henry Williams, Assistant Dean for the College of Arts and Sciences, and Dr. Larry Rivers signed the Assignment of Responsibility Form for Summer Term "C" for Dr. Jain on May 5 and 6, 2003, respectively. Dr. Williams and Dr. Rivers also signed two forms on May 5 and 6, 2003, respectively, regarding Dr. Jain entitled "Recommendation for Faculty Employment." One was for the period of employment designated May 12, 2003 to June 30, 2003. The second was for the period July 1, 2003 to August 1, 2003. These recommendations went to the new Provost, Dr. Robinson. Dr. Larry Robinson became Provost and Vice President of Academic Affairs of the University on May 5, 2003. On May 20, 2003, Dr. Robinson signed two employment contracts regarding Dr. Jain for Summer Term "C." The first contract period was May 12, 2003 to June 30, 2003. The period of the second contract was July 1, 2003 until August 1, 2003. There were two contracts covering the summer term because the "C" summer term during which the physics courses were taught, extended into the next fiscal year. There is a section on the two summer contracts entitled "Tenure Status." There is an "X" beside the designation "Tenured." On May 21, 2003, Nellie Woodruff sent a memo addressed to Dr. Robinson which stated as follows: SUBJECT: DROP Termination Date for Babu L. Jain We are requesting your intervention in bringing closure to the subject employee’s request to withdraw from the DROP and continue his employment with the University subsequent to May 31, 2003. Enclosed are copies of the documents which were received in this Office from both Dr. Jain and the Division of Retirement. Please advise this office by May 30, 2003, regarding the appropriate action to take relative to Dr. Jain’s request for withdrawal from the DROP and remaining an employee of the University. According to Dr. Robinson, Ms. Woodruff’s May 21, 2003, memorandum to him was the first time he "officially" became aware of the issue regarding Dr. Jain. That is, he was generally aware of the fact that several employees were approaching their retirement date and entering DROP. Dr. Jain’s designated retirement date was a month earlier than the other FAMU DROP participants who had a June 30, 2003, DROP termination date. Whether Dr. Robinson had unofficial knowledge of Dr. Jain's retirement date or of his desire to withdraw from DROP at the time he signed the two summer contracts is unclear based upon his testimony. As a result of learning of Dr. Jain’s situation, Dr. Robinson sent a certified letter to Dr. Jain dated May 27, 2003, which read as follows: This comes in response to your request to void your participation in the Deferred Retirement Option (DROP) program. It appears from your correspondence of April 18, 2003, addressed to Dr. Larry Rivers, Dean of the College of Arts and Sciences, that you believe the decision to void your participation is a unilateral one. On the contrary, the decision to void your participation in DROP is a mutual one, requiring the University’s assent. The University is not in agreement with your decision to void your participation in DROP. I call your attention to two documents, Form DP-ELE and Form DP-11, which are on file with your signature. Specifically, Form DP- ELE reads in relevant part as follows: "I elect to participate in the DROP in accordance with Subsection 121.091(13), Florida Statutes (F.S.), as indicated above and resign my employment on the date I terminate from the DROP." Additionally, Form DP-11 reads in relevant part as follows: "I have resigned my employment on the date stated above and elect to participate in the DROP in accordance with Subsection 121.091(13), Florida Statutes (F.S.).” Regrettably, the University must inform you that it will follow the guidelines for DROP as outlined in the aforementioned Florida Statutes and cannot support your request to void your application in DROP. I also call your attention to Florida A&M University Rule 6C-10.211(2)(c), Florida Administrative Code which is enclosed with the aforementioned forms. Thank you for your many years of service to the University. The Division of Retirement issued a letter, dated May 5, 2003, to Dr. Jain with Form DP-VOID enclosed. Dr. Jain insists he did not receive it in the mail and, therefore, went to the Division of Retirement on May 29, 2003, to pick it up. In any event, he signed the DROP-VOID form on May 29, 2003, and took it to FAMU in an attempt to get it executed by Dr. Rivers or Dr. Robinson. The DROP-VOID form contains a section entitled "Employer Certification" which reads as follows: This is to certify that the (agency name) has rescinded the resignation of the above named member, and the member will continue working in a regularly established position with FRS ceverage. We understand the member’s DROP participation will be null and void, the membership in the FRS Pension Plan will be reestablished to the date the member joined the DROP and we will begin immediately reporting the correct retirement plan and contributions to the Division of Retirement. FRS will adjust previous payrolls reported under DROP based upon the member not having joined the DROP. In addition, we understand that contributions, plus interest, may be required. Future payrolls should reflect the retirement plan of active membership. Despite Dr. Jain’s efforts on May 29 and 30, 2003, to get this form signed, the DROP-VOID form was not signed by anyone at FAMU. On either May 29 or 30, 2003, Dr. Mochena received a call from Dr. Henry Williams, Assistant Dean for the College of Arts and Sciences, who instructed Dr. Mochena to end Dr. Jain’s summer employment and to reassign Dr. Jain’s classes to another instructor. Dr. Mochena assigned Mr. Jay Jackson to teach Dr. Jain’s classes beginning Monday, June 2, 2003. Dr. Robinson wrote a second letter to Dr. Jain on May 30, 2003, which read in pertinent part as follows: Dear Dr. Jain: This letter is to inform you that the two Summer Semester Employment Contracts, May 12, 2003 to June 30, 2003, and July 1, 2003 to August 1, 2003, were issued in error to you due to the fact that your DROP retirement date is May 31, 2003. As a result, you will be paid through May 30, 2003 for your services to the University and the University will consider you to have retired as of May 31, 2003. On Monday, June 2, 2003, Dr. Jain arrived at his classroom where Mr. Jackson was teaching. Dr. Jain left the classroom and went to see Dr. Mochena. Dr. Jain learned from Dr. Mochena that he had been instructed by the Dean prior to Saturday, May 31, 2003, to replace Dr. Jain with another instructor. Dr. Jain continued to go to his office for several days after June 2, 2003, "doing things I usually do. Do some research, study, read." He did not teach any classes in June 2003. Each department submits a payroll certification indicating the number of hours that an employee worked during a pay period. The payroll certification signed by Dr. Mochena on June 4, 2003, for the pay-period May 23 through June 5, 2003, initially indicated that Dr. Jain worked 79.3 hours. However, the 79.3 was crossed out and replaced with 47.58. The 47.58 was in handwriting, not typed as the rest of the numbers on the certification sheet which included the entry of 79.3 hours. The record is not clear as to who made the correction or when it was made. According to Ms. Woodruff, however, it is not the practice of the payroll section to change any certifications after the fact. Additionally, once an employee in a salaried position is added to the payroll, he/she is automatically issued a paycheck based upon the contract, unless some action occurs. In any event, the payroll section did not make an adjustment in Dr. Jain’s pay for the pay-period May 23 through June 5, 2003. Dr. Jain’s received an Earnings Statement reflecting a "pay date" of June 13, 2003, and a pay-period of 05/23/2003- 06/05/2003 reflecting regular wages of $3,266.11. Subsequently, the payroll office at FAMU completed a Refund for Overpayment of Salary form and submitted it to the Office of the Comptroller, Bureau of State Payrolls. In the section entitled, Reason for Adjustment, the payroll office wrote, "DROP end date 5/30/03." A salary refund in the amount of $898.33 was deducted from Dr. Jain’s sick leave payout on June 20, 2003.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is RECOMMENDED: That Respondent enter a final order rescinding its letters of May 27 and 30, 2003, and reinstating Petitioner to employment effective June 1, 2003, including all salary and benefits for that period of time.1/ DONE AND ENTERED this 17th day of May, 2004, in Tallahassee, Leon County, Florida. S BARBARA J. STAROS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 17th day of May, 2004.
The Issue The central issue in this case is whether Petitioner is entitled to benefits for a deceased Florida Retirement System member.
Findings Of Fact Based upon the testimony of the witnesses and the documentary evidence received at the hearing, I make the following findings of fact: William H. Schlussler, Jr. was employed with the police department for Metro-Dade County beginning in June, 1970. On December 1, 1970, Mr. Schlussler became a member of the Florida Retirement System. Mr. Schlussler remained continuously employed and a member of the System until his death on September 30, 1986. On July 13, 1970, Mr. Schlussler designated his father, William H. Schlussler, Sr., as the sole beneficiary of benefits under the retirement system. On July 14, 1972, Mr. Schlussler married Mirta Schlussler, Petitioner herein. The couple remained continuously married until the time of Mr. Schlussler's death. Throughout the course of their marriage, the Schlusslers acquired property in their joint names. Property which Mr. Schlussler had owned prior to his marriage was transferred to include Mirta Schlussler. In connection with his work, Mr. Schlussler participated in a group life insurance program. After his marriage, Mr. Schlussler amended the beneficiary forms to provide Mirta Schlussler as his sole beneficiary for life insurance proceeds. At his death, Mirta Schlussler received those benefits. Mr. Schlussler intended to designate Mirta Schlussler as his beneficiary for benefits under the Florida Retirement System. And although he stated this intention to several co-workers/friends, documentary evidence to establish that he completed and filed a change of beneficiary form does not exist. Moreover, no one witnessed Mr. Schlussler execute and file a change of beneficiary form for the Florida Retirement System (FRS). The only form on file with the FRS was the one executed on July 13, 1970, which designated William H. Schlussler, Sr. the sole beneficiary. William H. Schlussler, Sr. survived William H. Schlussler, Jr.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Administration, Division of Retirement enter a Final Order denying benefits to Petitioner. DONE and RECOMMENDED this 4th day of February, 1988, in Tallahassee, Florida. JOYOUS D. PARRISH Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 4th day of February, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-2472 Rulings on Proposed Findings of Fact submitted by Petitioner: Paragraph 1 is accepted. Paragraph 2 is accepted. Paragraph 3 is accepted. Paragraph 4 is accepted but is unnecessary to the determination made herein. Paragraph 5 is accepted but is irrelevant, immaterial, and unnecessary to the determination made herein. With regard to paragraph 6 and its subparts, the first two sentences are rejected as contrary to the weight of the evidence presented. However, subparts a., b., c., d., e., and f. are accepted. There is no doubt William H. Schlussler, Jr. intended his wife to receive all benefits available. Subpart g. is rejected to the extent it suggests Mr. Schlussler did, in fact, execute the required form. There was no direct evidence that this deceased completed the form required to change the beneficiary designation. Subparts h. & i. are accepted but cannot constitute proof of this deceased having executed the required form. Paragraph 7 is accepted but is unnecessary to the resolution of the issue herein. Paragraph 8 is rejected as irrelevant, immaterial and unnecessary. Paragraph 9 is accepted but is irrelevant, immaterial and unnecessary. The file destroyed was a duplicate not the sole file. Paragraph 10 is accepted. Paragraph 11 is rejected. Mr. Schlussler's file did not contain the form in issue. The absence of it does not prove its existence. Moreover, the file required, by statute, would be maintained by the Division. That the local government might also have the form would be a sound argument of its execution. Of course then the argument would be as to filing. In this case, the proof failed as to both execution and filing. The proof offered established only intent. COPIES FURNISHED: Donald D. Slesnick, II, Esquire 2285 Southwest 17th Avenue Miami, Florida 33145 William A. Frieder, Esquire Division of Retirement 2639 North Monroe Street Suite 207 Building C Tallahassee, Florida 32399-1560 Adis Vila, Secretary Department of Administration Division of Retirement 435 Carlton Building Tallahassee, Florida 32399-1550
The Issue The issue presented is whether Petitioner's application for retroactive retirement benefits should be granted.
Findings Of Fact Petitioner was employed by the Palm Beach County Sheriff's Office for approximately twelve years, working in a special risk capacity. As a result of that employment, he was a member of the Florida Retirement System. In 1972 Petitioner completed Respondent's form FRS-M10 setting forth his membership as a special risk member of the Florida Retirement System as of November 1, 1970. Petitioner resigned his position on March 15, 1982, when he was 47 years of age and had more than ten years of creditable service. At the time of his resignation, he was employed in the position of Inspector, Director of Law Enforcement, the third in command at the Sheriff's Office. There are approximately 550,000 active members in the Florida Retirement System. Many members choose not to submit an application for retirement benefits on their normal retirement date for a variety of reasons. An application for retirement benefits is a prerequisite for the establishment of an effective retirement date for a member of the Florida Retirement System. In September of 1991, Petitioner applied for retirement benefits. At the time of his application, he was 57 years of age. Petitioner never contacted Respondent to request information or advice regarding his retirement benefits prior to filing his retirement application in September of 1991. Based upon receipt of Petitioner's application for retirement benefits in September of 1991, Respondent established October 1, 1991, as Petitioner's effective retirement date. In October of 1986 Petitioner received from the Palm Beach County Sheriff's Office a copy of some of Respondent's forms which are utilized by persons filing applications for retirement benefits. Some of the information included in that package relates to persons who are regular members of the Florida Retirement System, not special risk members.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered denying Petitioner's request to change his effective retirement date and denying Petitioner's request for retroactive retirement benefits. DONE and ENTERED this 1st day of September, 1992, at Tallahassee, Florida. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 1st day of September, 1992. APPENDIX TO RECOMMENDED ORDER DOAH CASE NO. 92-0849 Petitioner's proposed findings of fact numbered 1 and 3-5 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed finding of fact numbered 2 has been rejected as being contrary to the evidence in this cause. Petitioner's proposed findings of fact numbered 6-13 have been rejected as not constituting findings of fact but rather as constituting argument of counsel, conclusions of law, or recitation of the testimony. Respondent's proposed findings of fact numbered 1-10 have been adopted either verbatim or in substance in this Recommended Order. COPIES FURNISHED: Mary Alice Gwynn, Esquire Suite 302 215 Fifth Street West Palm Beach, Florida 33401 Larry D. Scott, Esquire Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee FL 32399-1560 A. J. McMullian, III, Director Division of Retirement Building C Cedars Executive Center 2639 North Monroe Street Tallahassee, Florida 32399-1560 Larry Strong Acting Secretary Department of Management Services Knight Building, Suite 307 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950
The Issue Whether Petitioner, Sergeant Ronald Behnke, should be allowed to withdraw from the Deferred Retirement Option Program (DROP) of the Florida Retirement System (FRS).
Findings Of Fact Petitioner is a trooper with the Florida Highway Patrol and participant in the Florida Retirement System for 27 years. On January 26, 1999, the Division of Retirement (Respondent) received a "Florida Retirement System Application for Service Retirement and the Deferred Retirement Option Program" from Petitioner for entry into the DROP program, effective April 1999, the month of his 50th birthday. Petitioner's application, a Special Risk Management Member, was acknowledged and accepted by Respondent on February 23, 1999, and Petitioner received his estimate of benefits shortly after that time. The statute governing FRS at that time permitted Petitioner to defer his election of entry into the DROP program to a date within "twelve months immediately following the date the member attains 57, or age 50 for Special Risk Class members." Section 121.091(13)(a)2., Florida Statutes (Supp. 1998). Respondent applied an internal policy requiring a member to elect to enter the DROP no later than the member's birth month at age 50. The statute permitted actual entry into DROP to be deferred by the member to any point within the 60-month duration of DROP eligibility. However, late entry could not extend the 60-month period, which is measured from the "date to which he or she is eligible to defer his or her election to participate." Section 121.091(13)(b)1., Florida Statutes (Supp. 1998). Petitioner's 50th birthday was April 9, 1999. Shortly after filing his application for the DROP program, but before April 1999, Petitioner learned there was pending legislation, which, if passed by the Legislature and signed by the governor, would allow him to delay his entry into DROP until 12 months following his 52nd birthday. He and other troopers closely watched and discussed legislation that could affect their positions. On March 12, 1999, Petitioner communicated with staff of Respondent. Respondent's staff advised Petitioner to send a letter requesting a delay in the effective date of entry into the DROP program. The staff explained that Petitioner could repeatedly change the effective date of DROP entry, while watching the pending legislation. Pursuant to these instructions, on March 12, 1999, Petitioner transmitted a letter, through personnel in the Department of Highway Safety and Motor Vehicles (DHSMV) to Respondent, modifying the DROP program entry date to commence on May 1, 1999. Thereafter, Petitioner continued to monitor the progress of the pending legislation closely. Shortly after April 23, 1999, Petitioner received a letter from Ira L. Gaines, Benefits Administrator, employed by Respondent, cautioning Petitioner about his letter delaying entry into the DROP program. The letter advised Petitioner that the month of April 1999, was the only month he could accomplish cancellation of his DROP application, and that if the pending legislation did not pass, he would not be able to establish a retroactive start date. On April 26, 1999, Petitioner received a telephone call from Ira L. Gaines concerning his letter delaying his entry into the DROP program until May 1, 1999. Petitioner testified that Gaines represented to Petitioner that the pending legislation, which would have extended the time for entering the DROP program until age 52, was most likely "dead." He explained that Petitioner would, therefore, lose substantial benefits unless he withdrew his letter delaying entry until May 1999. He recommended that Petitioner enter the program effective April 1, 1999. Although he understood that no Division employee could control the outcome of the legislation, Petitioner relied upon these representations by Respondent's benefits administrator and sent a letter to Respondent dated April 27, 1999, rescinding his March 12, 1999, letter and entered the DROP program, effective April 1, 1999. Thereafter, Petitioner ceased efforts to follow actions by the Legislature. On October 8, 1999, Petitioner learned the legislation had passed and become law permitting DROP entry at the age of 52. Petitioner immediately addressed the question of withdrawing from DROP until the age of 52 with the director of the Division of the Florida Highway Patrol (FHP). Petitioner received a verbal assurances that it would benefit FHP if Petitioner were permitted to delay entry into DROP until the age of 52, since FHP expected to lose a great many experienced officers in a short period of time. The division director told Petitioner he would make inquiry and get back with Petitioner about his desire to withdraw from DROP until the age of 52. When Petitioner had not heard from his chain of command by October 20, 1999, he again initiated contacts with benefits staff in the DHSMV and Respondent. DHSMV Human Resources Director, Ken Wilson, on behalf of the FHP Director, directed Petitioner to pursue the matter with Respondent and to notify him of Respondent's decision. Petitioner's employer, FHP, supported and approved Petitioner's request to withdraw from DROP, and notified Respondent of its approval and its commitment to repay retirement contributions. On October 25, 1999, Petitioner contacted Maurice Helms with Respondent, and requested consideration of his desire to withdraw from DROP. On November 3, 1999, Petitioner received a decision from Respondent notifying him that request to withdraw from DROP was denied. The decision was received by certified mail, return receipt requested. The decision recited that it constituted "final agency action" and notified Petitioner of his right to file a formal petition for review within 21 days of receipt of the final order. Another trooper, Corporal Dwight Wiles, testified that he was allowed to cancel his DROP application after his first month of participation. However, Corporal Wiles did not receive his estimate of benefits until after his first month of participation. Ira L. Gaines testified on behalf of Respondent that the Division's policy allowed all participants to withdraw their application within the month of their eligibility, or within 30 days of receiving their estimate of benefits, whichever was later. Mr. Gaines testified that it was an operational policy of the Division, as it was a new program and there were some 40,000 participants, the estimates of benefits could not always be accomplished by the DROP effective date. Mr. Gaines testified that this was done for the benefit of the members, so that they would have an opportunity to decide if the benefits were enough or if they wanted to continue accruing retirement credits. No formal rules have been adopted by the Division regarding the DROP program because it is still a new program. Mr. Gaines testified that Respondent's DROP Question and Answer memoranda was an internal office operational policy that was necessary to deal with the new program and that the information was not given to members. In fact, the memoranda was marked "DO NOT DISTRIBUTE OUTSIDE THE DIVISION--FOR INTERNAL USE." Mr. Gaines testified that allowing members to change their DROP effective date as they pleased would create a burden on the Division and that his section would be unable to handle the workload. There is no provision in the statute which speaks to withdrawal from the DROP program once participation has begun. Petitioner detrimentally relied upon misrepresentations of fact and/or law by staff of Respondent, who convinced him to withdraw the letter delaying entry into DROP. Respondent's staff had both the appearance of knowledge and authority to make representations on behalf of Respondent. On learning of erroneous information, Petitioner did not sit on his rights. He immediately took action to mitigate his injury by seeking to withdraw from the DROP program. Respondent has adopted policies of general applicability governing administration of DROP entry by members of the Florida Retirement System. Although Respondent has rule-making authority, pursuant to Section 121.091(13)(k), Florida Statutes, these policies have not been adopted as administrative rule pursuant to Chapter 120, Florida Statutes. They have not been and are not otherwise distributed to members of the FRS or other agencies of Florida government. Rather, the policies are retained for internal use of Respondent. Two of Respondent's unadopted policies adversely affected Petitioner: (1) that of requiring an election to participate in DROP in the month of a Special Risk member's 50th birthday, rather than within 12 months of reaching 50 years of age; and (2) that of restricting withdrawal of a DROP application to the last day of the month of a member's 50th birthday or 30 days following receipt of a DROP estimate.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Division of Retirement enter a final order granting Petitioner's request to withdraw from the Deferred Retirement Option Program, without loss of eligibility upon repayment of any retirement contributions. DONE AND ENTERED this 14th day of August, 2000, in Tallahassee, Leon County, Florida. DANIEL M. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of August, 2000. COPIES FURNISHED: Jerry G. Traynham, Esquire Patterson & Traynham Post Office Box 4289 Tallahassee, Florida 32315-4289 Thomas E. Wright, Esquire Division of Retirement Department of Management Services Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Ron Poppell, Interim Director Division of Retirement Department of Management Services Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Emily Moore, Chief Legal Counsel Division of Retirement Department of Management Services Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Bruce Hoffmann, General Counsel Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950
The Issue The issue is whether to grant Petitioner's request that her deceased husband's selection under the Florida Retirement System be changed from Option 1 to Option 3.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: In this retirement dispute, Petitioner, Clara F. Holland, seeks to change her late husband's selection under the Florida Retirement System from Option 1 to Option 3 on the ground he was mentally incompetent to make a rational decision when the selection was made. Respondent, Division of Retirement (Division), has denied the request on the grounds that the late husband, William T. Holland (Holland), cashed or deposited his Option 1 retirement benefits from February 1993 until his death in December 1997, and that the law prohibits a change of options under these circumstances. Counting his state and military service, Holland accrued almost thirty years of creditable service with the Florida Retirement System between 1959 and early 1993, when he retired, due to a disability. In the spring of 1990, while employed at Florida State Hospital as a vocational instructor II, he first began contemplating retirement and contacted the Division requesting an estimate of benefits. In April or May 1990, Holland was sent an estimate of benefits, a pamphlet entitled "Preparing to Retire," and an "OPT FRS form," which explained in detail the various retirement options available. Among these were Options 1 and 3. In general terms, the first option paid the largest monthly benefits but terminated upon the death of the retiree. The third option paid smaller benefits, but if the retiree predeceased his spouse, the spouse would continue receiving benefits for her lifetime. This was fully explained in the form. On October 8, 1992, Holland was admitted to Tallahassee Community Hospital (TCC) suffering from recurrent transient ischemic attacks. After various tests were run, Holland underwent an emergency carotid endarterectomy to alleviate a blockage in his left carotid artery. During that surgery, he suffered a stroke, which, among other things, paralyzed his left side and temporarily confined him to a wheelchair. Immediately after the stroke, he could not speak or recognize family members, and he was totally dependent on others. Holland was eventually discharged from TCC on October 22, 1992, and referred to Capital Rehabilitation Hospital (CRH) for additional physical and speech therapy. At the time of discharge from TCC, his treating neurologist, who did not testify at final hearing, noted in the patient records, and without further explanation, that he had "returned to essentially his normal mental status." As a medical record, and an exception to the hearsay rule, this notation constitutes the only competent evidence of record from a medical doctor concerning Holland's mental status at that time. Holland remained at CRH until November 25, 1992, or the day before Thanksgiving. During his month-long stay at CRH, he was given a course of rehabilitation treatment which included physical therapy, occupational therapy, speech therapy, psychology, and recreation. In addition, his brain function was evaluated by a certified speech language pathologist, Linda Boynton, who presented expert testimony as a speech pathologist in this cause. Boynton had no independent recollection of Holland; instead, she based her deposition testimony on the evaluation and testing data she compiled in October and November 1992 while treating him. According to Boynton, because of a deficit in the right side of his brain, Holland was disoriented in terms of time and date; his brain could not interpret all of the images that it was picking up; he had difficulty with remembering, retaining, or recalling facts; and he had problems with the higher levels of mental activity. In addition, while he could read "chunks" of words, he could not read whole sentences. She also opined that at the time she was evaluating him, Holland would have been unable to remember the information contained in the four retirement options even if it was explained to him. Boynton conceded, however, that Holland's stroke was "mild," his comprehension was "adequate," and he scored "moderate" in the cognitive areas. She also confirmed that stroke victims could improve in a matter of days, and that everyone's recovery is different. She had no firsthand knowledge of Holland's mental status on November 7, 1992, the critical date in this dispute. Finally, Boynton was not a medical doctor, and her expertise was limited to speech pathology. For these reasons, her testimony has not been accorded the weight given to the notation in Holland's medical records during his stay at TCH. Shortly after being transferred to CRH, that facility began allowing Holland to go to his home in Sneads, Florida, on "weekend passes." While at home on November 7, 1992, a Saturday, Holland decided to make application for disability retirement with the State. The record does not reflect the person who actually obtained the retirement papers from the Division, but Holland's daughter carried them to his treating physicians so that they could verify in writing the nature of his disability. With the assistance of his wife, Holland completed Division Form FR-13 and selected Option 1, which extended retirement benefits for his lifetime only. In his wife's words, Option 1 was selected because "I don't think we knew we had a choice." At that time, Petitioner says her husband was still strapped in a wheelchair, he was mentally confused, and he could only briefly converse with others. Petitioner also signed the form since there is a requirement that if Option 1 is selected by a married retiree, the spouse must sign the form. Petitioner telephoned William "Bubba" Nelson, Jr., a second cousin who was chief of police in Sneads, and asked that he stop by the house that morning, witness Holland sign the form, and notarize the application. Nelson agreed and notarized the document as requested. The entire visit took no more than five minutes. At hearing, Nelson recalled that Holland used a walker to come into the den to sign the document; he did not appear to be "confused" when he signed the application; he did not ever lose his train of thought; he did not struggle to think of a word while speaking; his "mental capacity seemed to be not affected," and the two were able to engage in small talk for a minute or so. Petitioner then carried the papers to the Division's offices in Tallahassee on November 9, 1992, but was told that her husband needed to sign the form in one other place. Accordingly, she carried the form to CRH and obtained her husband's signature. A stamp on the document reflects that the fully executed document was later filed with the Division on November 13, 1992. When she filed the forms, Petitioner did not ask for any additional information regarding the various options; had she done so, counseling was available at the Division during normal business hours. When the application was filed, Holland had 1.84 years of military service; he also had refunded service from October 1959 to October 1961 and September 1963 to February 1966. Accordingly, on January 12, 1993, the Division advised Holland that $3,334.68 was due if he intended to claim that service. If he did so, his Option 1 benefits would increase almost $200.00 per month. The form requested that Holland notify the Division in writing only if he wished to retire with paid-on service, and not claim his military and refunded service. Finally, the form advised him in bold print as follows: YOU HAVE CHOSEN OPTION 1. YOUR OPTION SELECTION CANNOT BE CHANGED AFTER YOU CASH OR DEPOSIT ANY BENEFIT PAYMENT. The record does not specifically show if Holland opted to purchase his military and refunded service. However, it can be reasonably inferred that he did since the first benefit check described in Respondent's Exhibit 4 roughly equated to what his estimated benefits would have been under Option 1 if such service had been purchased, and there is no record of any written notice to the Division by Holland that he did not wish to purchase this service. Holland's first benefit check was issued on February 5, 1993, and mailed to him on February 9, 1993. That check, and all subsequent monthly checks until his death in December 1997, were cashed or deposited by Holland. They totaled $55,830.72, or more than his total deposits to the retirement system. Therefore, when he died, Petitioner was not due any refunded contributions or future monthly benefits. If Petitioner prevails in this action, however, she would be required to offset any future benefits by approximately $22,000.00, which represents the difference between the benefits payable under Options 1 and 3 during the lifetime of her husband. In August 1994, Holland received a new driver's license with the only restriction being that he had to drive a vehicle with an automatic transmission. He used his license to drive to Marianna for physical rehabilitation treatement. At no time was Holland ever adjudicated incompetent or incapacitated by a court. It is fair to state that he experienced gradual but continued improvement from the time of his release from the hospital until his death in December 1997.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Division of Retirement enter a final order denying Petitioner's request that her late husband's election of retirement benefits be changed. DONE AND ENTERED this 29th day of June, 1999, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 29th day of June, 1999. COPIES FURNISHED: A. J. McMullian, III, Director Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Emily Moore, Chief Legal Counsel Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Robert B. Button, Esquire Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Stanley M. Danek, Esquire 2114 Great Oak Drive, Suite 200 Tallahassee, Florida 32303
The Issue Whether Petitioner must forfeit and repay distributions he received from the Deferred Retirement Option Program and subsequent monthly retirement benefits received as a consequence of his election to the position of County Commissioner of Jefferson County within six months of terminating state employment.
Findings Of Fact The Division of Retirement (Division) is, and was at the times material to this case, the state agency charged with the responsibility of administering the Florida Retirement System (FRS). Petitioner, John Nelson, was employed by the Department of Financial Services (DFS) from October 1977 through July 31, 2010. For the last five years of his employment with DFS, Petitioner participated in the Deferred Retirement Option Program (DROP). Prior to ending his DROP participation, Petitioner completed a DROP Termination Notification Form (DP-TERM Rev. 06/06) on April 23, 2010, confirming he would terminate employment on July 31, 2010. The DROP Termination Notification was also signed by a representative from FRS confirming Petitioner's employment termination date and reads in pertinent part: I understand that I cannot work for any Florida Retirement System (FRS) covered employer during the calendar month following my DROP termination date or my DROP participation will be null and void. If I fail to meet this requirement, I will forfeit my accumulated DROP benefit including interest. I also understand that I may not be reemployed by any FRS employer in any capacity including part-time, temporary, other personal services (OPS) or non-Division approved contractual services during the calendar month immediately following my DROP termination date. If I fail to meet this requirement, I will forfeit my accumulated DROP benefit, including interest retroactive to me enrollment date in the DROP. The above-referenced version of the DP-TERM (Revised 6/06) has been incorporated by reference into Florida Administrative Code Rule 60S-9.001(ee). Due to significant statutory changes made by the Legislature, the Division sent to Petitioner a second DROP Termination Notification, (Form DP-TERM revised 04/10) which he signed on June 9, 2010. The wording in the revised form reflected statutory changes which would take effect July 1, 2010. The revised form states in pertinent part: If your DROP termination date is on or after July 1, 2010: Your termination requirement means you cannot remain employed or become re-employed with any Florida Retirement System (FRS) covered employer during the FIRST SIX calendar months following your DROP termination date. This includes but is not limited to: Part-time work, temporary work, other personal services (OPS), substitute teaching or non-Division approved contractual services. During the 7th-12th calendar months following your DROP termination date, you may return to work for a participating FRS employer but must suspend your retirement benefit for any of these months your[sic] are employed. There are no reemployment exceptions during the reemployment limitation period. After the 12th calendar month following your DROP termination date, there are no employment restrictions. If you fail to meet the termination requirements noted above, you will void (cancel) your retirement and DROP participation, you must repay all retirement benefits received including your DROP accumulation, and you must apply to establish a future retirement date. If you void your retirement your employer will be responsible for making retroactive retirement contributions and you will be awarded service credit for the period during which you were in DROP through your new termination date. Your eligibility for DROP participation will be determined by your future retirement date and you may lose your eligibility to participate in DROP. (emphasis added). The revised form DP-TERM (Revised 04/10) has not yet been adopted as a rule. At the time of hearing, rulemaking had been initiated. Petitioner terminated his employment with DFS on the agreed termination date of July 31, 2010, and was no longer an employee of DFS after that date. Sometime between July 31, 2010, and November 2010, Petitioner was paid his accumulated DROP monies in the amount of $181,635.09, in the form of a direct rollover into an eligible retirement account. Petitioner was also paid monthly retirement benefits for the months of August through November 2010, in the total amount of $11,286.76. The Division deactivated Petitioner's monthly retirement benefits in December 2011. The total amount of retirement benefits paid to Petitioner after terminating employment with DFS is $191,921.85, which the Division seeks to recover. In April of 2010, at the urging of community members, Petitioner registered to run for public office in Jefferson County, Florida. He won the election and was sworn into office as a Jefferson County Commissioner on November 16, 2010. Tyler McNeill is the Chief Deputy Clerk and Human Resources Officer for Jefferson County. Following Petitioner's election as a County Commissioner, Mr. McNeill began to process a small packet of employment-related documents which he provides to elected officials. Mr. McNeill went to Petitioner's home on a Sunday evening to get the necessary papers signed. Prior to this meeting, Petitioner was unaware that Jefferson County participates in the FRS. Petitioner described his reaction to learning this as "shocking." When Mr. McNeill and Petitioner got to the FRS form, Petitioner did not want to sign it and informed Mr. McNeill of that. Mr. McNeill described Petitioner as appearing physically ill, shocked, and "so upset" upon learning that the County was an FRS participating employer. On November 22, 2010, Petitioner and Mr. McNeill called Ira Gaines, FRS Benefits Administrator, using a speakerphone. At the time they placed this call, Petitioner had not yet signed the employment documents supplied to him by Mr. McNeill, and Petitioner informed Mr. Gaines of this. During this conversation, Petitioner expressed his willingness to resign from office and refuse to accept payment from the County for his newly elected position. According to Mr. McNeill, Petitioner was not yet eligible to receive compensation from the County because the employment papers had not yet been processed. Mr. McNeill testified that he would have been able to discard the documents. During this telephone conversation, Mr. Gaines advised that Petitioner was legally a person employed by the County by virtue of his being sworn into office on November 16, 2010. Mr. Gaines equated bring sworn into office as being an employee. At hearing, Mr. Gaines reiterated his position: that he did not know any way Petitioner could not be enrolled in FRS when occupying an elected position. As a result of this telephone conversation with Mr. Gaines and in reliance on Mr. Gaines' advice, Mr. McNeill processed Petitioner's employment papers including the FRS reenrollment form. Mr. Gaines then began receiving salary payments for being a county commissioner. On December 6, 2010, Mr. Gaines sent a letter to Petitioner stating that his election to the position of County Commissioner had voided his DROP participation, and consequently, Petitioner would have to repay $181,635.09 for the DROP payment, and $11,286.76 in monthly retirement benefits. The letter further informed that Petitioner will continue to earn credit as an elected official in the Elected Officer's Class of FRS membership and that Petitioner's retirement account would be adjusted to reflect service from August 2005 through July 2010 (his DROP period) which he estimated would increase Petitioner's retirement benefits by $1,200 per month. In response to the December 6, 2010 letter, Petitioner appealed the voiding of his DROP participation. By letter dated February 1, 2011, the Division denied the request. The February 1, 2011 letter also informed Petitioner of his right to request a hearing, which gave rise to this proceeding.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is RECOMMENDED: That the Division of Retirement enter a final order rescinding the February 1, 2011, notification letter requiring reimbursement of Petitioner's DROP distribution and reimbursement of Petitioner's monthly retirement benefits from August 2010 through December 2010 when those benefits were discontinued; reinstating those monthly benefits beginning six months following the completion of Petitioner's DROP period, and nullifying Petitioner's reenrollment in the Elected Officers' Class of FRS membership. DONE AND ENTERED this 8th day of March, 2012, in Tallahassee, Leon County, Florida. S BARBARA J. STAROS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 8th day of March, 2012.
The Issue Whether the Petitioner is entitled to back- date her disability retirement date as requested.
Findings Of Fact At all times material to the findings of this case, the Petitioner, Annie L. Gibbs, was a member of the Florida Retirement System (FRS). In 1995 the Petitioner was injured and unable to work for a period of time. Although she did return to work for an unknown period, she was unable to continue. The Petitioner seeks retirement benefits from November of 1995, the date from which she initially filed an application for benefits. She has not received benefits for the years 1996 and 1997. The Department acknowledges that it received Petitioner's application for disability retirement on or about November 30, 1995. In response, the Respondent sent Petitioner requests for additional information in order for the application to be completed. The first of these requests was directed to Petitioner on December 8, 1995. The Petitioner never submitted responses to the requests for additional information. Physician reports were required in order to confirm the Petitioner's medical condition. The Petitioner did not submit the forms. On January 26, 1996, the Respondent submitted a follow-up letter again noting that the information was needed to complete the Petitioner's application for benefits. The Petitioner maintains that she provided the forms to her physician(s) and that she could not compel them to submit the forms. For whatever reason, the forms were not tendered to the Department. Without the forms the Respondent could not approve the Petitioner's request for benefits. The Department sent a third notice to the Petitioner requesting the information on April 26, 1996. Additional notices were sent to the Petitioner. All notices went to the Petitioner's address of record where she has continuously resided since the outset of this issue. The Department maintains copies of the certified mail receipts indicating the Petitioner signed for the notices requesting additional information. The Petitioner does not dispute that the Department sent the notices. Moreover, the Petitioner does not dispute that she received such notices although she may not remember them. The Petitioner maintains that her mental state during the period of time the notices were provided was such that she was not functioning properly to adequately protect her interests in this matter. Why family members or others were unable to address this matter is unknown. The Department is required by law to follow specific guidelines in the processing of claims for disability retirement. It has followed all such procedures in this cause. The Petitioner submitted a second application for disability retirement on September 30, 1998. Thereafter the Petitioner was approved for benefits and such payments began in October 1998. In conjunction with the second application, the Petitioner submitted all forms required by the Department to process and approve the request.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Management Services, Division of Retirement, enter a final order denying the Petitioner's request to backdate the application for benefits. DONE AND ENTERED this 18th day of September, 2002, in Tallahassee, Leon County, Florida. ___________________________________ J. D. PARRISH Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 18th day of September, 2002. COPIES FURNISHED: Erin Sjostrom, Director Division of Retirement Department of Management Services Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Monesia Taylor Brown, Acting General Counsel Department of Management Services Division of Retirement 4050 Esplanade Way Tallahassee, Florida 32399-1560 Annie L. Gibbs 10351 Quito Street Cooper City, Florida 33026-4519 Larry D. Scott, Esquire Department of Management Services 4050 Esplanade Way, Suite 260 Tallahassee, Florida 32399-0950
