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A BILL TO BE ENTITLED
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AN ACT
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relating to the authority to issue obligations to fund all or any |
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unfunded liability by certain counties. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle B, Title 4, Chapter 130, Local |
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Government Code, is amended by adding Subchapter B to read as |
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follows: |
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SUBCHAPTER B. OBLIGATIONS FOR CERTAIN LIABILITIES TO PUBLIC |
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PENSION FUNDS OF CERTAIN COUNTIES |
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Sec. 130.201. APPLICABILITY OF SUBCHAPTER. |
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This subchapter applies only to a county with a population of |
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more than 800,000 that borders a county with a population of more |
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than 3 million. |
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Sec. 130.202. DEFINITIONS. In this chapter: |
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(1) "Obligation" includes a bond, certificate, note, |
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or book entry obligation. |
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(2) "Unfunded liability" means an unfunded, accrued |
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liability of a county to a public pension fund as determined by |
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actuarial analysis. |
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Sec. 130.203. DEFINITION OF "PUBLIC PENSION FUND". In this |
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chapter, "public pension fund": |
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(1) means a continuing, organized program or plan of |
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service retirement, disability retirement, or death benefits for |
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officers or employees of a county; |
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(2) includes a plan qualified under Section 401(a), |
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Internal Revenue Code of 1986, as amended,; and |
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(3) does not include: |
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(A) a program that provides only workers' |
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compensation benefits; |
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(B) a program administered by the federal |
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government; |
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(C) a plan described by Section 401(d), Internal |
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Revenue Code of 1986, as amended; |
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(D) an individual retirement account consisting |
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of an annuity contract described by Section 403(b), Internal |
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Revenue Code of 1986, as amended; |
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(E) an individual retirement account as defined |
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by Section 408(a), Internal Revenue Code of 1986, as amended; |
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(F) an individual retirement annuity as defined |
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by Section 408(b), Internal Revenue Code of 1986, as amended; |
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(G) an eligible deferred compensation plan as |
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defined by Section 457(b), Internal Revenue Code of 1986, as |
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amended; or |
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(H) a program for which benefits are administered |
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by a life insurance company or for which the only funding agency is |
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a life insurance company. |
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Sec. 130.204. PENSION FUND OBLIGATIONS AUTHORIZED. (a) A |
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county may issue obligations to fund all or any part of an unfunded |
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liability. |
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(b) Before authorizing issuance and delivery of an |
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obligation under this section, the commissioners court of the |
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county must enter into a written agreement with the governing body |
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of the public retirement system that: |
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(1) has fiduciary responsibility for assets of the |
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public pension fund or public pension funds that are to receive the |
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net proceeds of the obligations to be issued; and |
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(2) has the duty to oversee the investment and |
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expenditure of the assets of the public pension fund. |
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(c) The written agreement must state the amount of the |
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unfunded liability and the date or dates on which the public pension |
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fund will accept the net proceeds of the obligations to be issued in |
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payment of all or a portion of the unfunded liability. |
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Sec. 130.2045. VOTER APPROVAL REQUIRED FOR CERTAIN PENSION |
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FUND OBLIGATIONS. (a) This section applies only to a public |
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pension fund subject to: |
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(1) Article 6243e.2(1), Revised Statutes; |
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(2) Chapter 88 (H.B. 1573), Acts of the 77th |
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Legislature, Regular Session, 2001 (Article 6243h, Vernon's Texas |
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Civil Statutes); and |
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(3) Article 6243g-4, Revised Statutes. |
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(b) A county may issue an obligation under Section 130.204 |
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to fund all or any part of the unfunded liability of a public |
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pension fund subject to this section only if the issuance is |
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approved by a majority of the qualified voters of the county voting |
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at an election held for that purpose. |
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Sec. 130.205. PROCEEDS OF OBLIGATIONS ISSUED. The county |
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shall deposit the net proceeds of obligations issued under Section |
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130.204 to the credit of the public pension fund. The amount |
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deposited under this section becomes part of the public pension |
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fund's assets. |
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Sec. 130.206. PAYMENT OF OBLIGATIONS. (a) An obligation |
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issued under 130.204 may be made payable by the county from: |
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(1) the fund from which compensation is paid to its |
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officers and employees; |
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(2) its general fund; or |
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(3) sales and use taxes, revenues, both sales and use |
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taxes and revenues, or any other source or combination of sources of |
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money that the county may use under state law, except ad valorem |
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taxes, to secure or pay any kind of bond or obligation. |
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(b) An obligation issued under 130.204 shall not be made |
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payable by the county from ad valorem taxes. |
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Sec. 130.207. OBLIGATION AS REFINANCING. An obligation |
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issued under Section 130.204 is a complete or partial refinancing |
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of a commitment of the county to fund its unfunded liability. |
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Sec. 130.208. SALE OF OBLIGATIONS; MATURITY. Obligations |
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issued under Section 130.204 may be sold at private or public sale |
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and must not mature later than the 30th anniversary of the date of |
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issuance. |
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Sec. 130.209. ADDITIONAL AUTHORITY; CREDIT AGREEMENTS. (a) |
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In this section, "credit agreement" and "obligation" have the |
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meanings assigned by Section 1371.001, Government Code. |
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Sec. 130.210. CHAPTER CONTROLLING. This subchapter |
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prevails over any conflict between this subchapter and another law |
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respecting the issuance of obligations of a county. |
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SECTION 2. 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, 2023. |