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A BILL TO BE ENTITLED
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AN ACT
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relating to contributions to the Employees Retirement System of |
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Texas. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 815.402(a), Government Code, is amended |
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to read as follows: |
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(a) Except as provided by Section 813.201, each payroll |
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period, each department or agency of the state shall cause to be |
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deducted from each member's compensation a contribution of: |
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(1) 9.5 percent of the compensation if the member is |
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not a member of the legislature, for service rendered after August |
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31, 2015, and before September 1, 2017; |
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(2) for service by a member who is not a member of the |
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legislature rendered on or after September 1, 2017, and before |
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September 1, 2021, the lesser of: |
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(A) 9.5 percent of the [member's annual] |
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compensation; or |
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(B) a percentage of the [member's annual] |
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compensation equal to 9.5 percent reduced by one-tenth of one |
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percent for each one-tenth of one percent that the state |
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contribution rate for the fiscal year to which the service relates |
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is less than the state contribution rate established for the 2017 |
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fiscal year; [or] |
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(3) 9.5 percent of the compensation if the member is a |
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member of the legislature, for service rendered before September 1, |
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2021; or |
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(4) for service rendered by any member on or after |
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September 1, 2021, an amount equal to the member contribution rate |
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adopted by the board of trustees under Section 815.4036 for the |
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applicable fiscal year multiplied by the member's compensation. |
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SECTION 2. Section 815.403(a), Government Code, is amended |
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to read as follows: |
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(a) During each fiscal year, the state shall contribute to |
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the retirement system: |
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(1) for the fiscal year beginning September 1, 2021, |
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and subsequent fiscal years, an amount equal to the state |
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contribution rate adopted by the board of trustees under Section |
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815.4036 for the applicable fiscal year multiplied by [7.4 percent |
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of] the total compensation of all members of the retirement system |
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for that year; |
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(2) money to pay lump-sum death benefits for retirees |
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under Section 814.501; |
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(3) an amount for the law enforcement and custodial |
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officer supplemental retirement fund equal to 2.13 percent of the |
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aggregate state compensation of all custodial and law enforcement |
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officers for that year; |
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(4) money necessary for the administration of the law |
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enforcement and custodial officer supplemental retirement fund; |
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and |
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(5) money for service credit not previously |
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established, as provided by Section 813.202(c) or 813.302(d). |
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SECTION 3. Subchapter E, Chapter 815, Government Code, is |
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amended by adding Section 815.4036 to read as follows: |
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Sec. 815.4036. ACTUARIALLY DETERMINED STATE AND MEMBER |
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CONTRIBUTION RATES. (a) For the fiscal year beginning September 1, |
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2021, and for each subsequent fiscal year: |
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(1) the actuary designated under Section 815.206 |
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shall: |
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(A) calculate an actuarially determined |
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contribution rate for the applicable fiscal year; and |
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(B) recommend to the board of trustees for review |
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and adoption the member contribution rate under Section |
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815.402(a)(4) and the state contribution rate under Section |
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815.403(a)(1) calculated by apportioning the actuarially |
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determined contribution rate under Paragraph (A) among members, the |
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state, and, subject to Section 815.4035(a), employers in a manner |
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that results in the member contribution rate not exceeding 50 |
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percent of the actuarially determined contribution rate; and |
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(2) the board shall adopt the contribution rates |
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recommended by the actuary under Subdivision (1)(B) as the member |
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contribution rate under Section 815.402(a)(4) and the state |
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contribution rate under Section 815.403(a)(1). |
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(b) For purposes of Subsection (a)(1), an actuarially |
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determined contribution rate is a percentage rate that reflects the |
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sum of: |
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(1) the normal cost of projected benefits for the |
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fiscal year; and |
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(2) the portion of the total payment toward the |
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unfunded actuarial accrued liabilities of the retirement system |
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that is: |
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(A) attributable to the fiscal year; and |
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(B) sufficient to amortize the unfunded |
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actuarial accrued liabilities of the system in a period that does |
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not exceed 30 years by one or more years. |
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(c) The actuarially determined contribution rate |
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recommended by the actuary under Subsection (a)(1) must be based |
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on: |
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(1) reasonable actuarial assumptions and methods; |
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(2) tables adopted by the board under Section 815.105; |
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and |
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(3) the funding policy adopted by the board under |
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Section 802.2011. |
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SECTION 4. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2021. |