By:  Turner, S.                                       H.B. No. 1748
       73R5861 SOS-F
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to the firemen's relief and retirement fund in certain
    1-3  municipalities.
    1-4        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-5        SECTION 1.  Section 2(l), Chapter 432, Acts of the 64th
    1-6  Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
    1-7  is amended to read as follows:
    1-8        (l)(1)  The board may, from fund assets, purchase from an
    1-9  insurer licensed to do business in this state insurance to cover
   1-10  liabilities and losses of the fund and to indemnify and hold the
   1-11  members of the board and employees of the board, individually and
   1-12  collectively, harmless from the effects and consequences of their
   1-13  acts, omissions, and conduct within the scope of their official
   1-14  capacity as fiduciaries or cofiduciaries or within the scope of
   1-15  what the board member or employee believed in good faith, at the
   1-16  time, to be the board member's or employee's official capacity.
   1-17  However, an insurance company through which insurance is purchased
   1-18  under this subsection has a cause of action against a board member
   1-19  or employee to the extent that a loss results from the board
   1-20  member's or employee's wilful and malicious misconduct or gross
   1-21  negligence.
   1-22              (2)  If insurance under Subdivision (1) of this
   1-23  subsection is unavailable, insufficient, inadequate, or not in
   1-24  effect, the board may indemnify board members or employees of the
    2-1  board for liability imposed as damages and for reasonable costs and
    2-2  expenses incurred by those individuals in defense of an alleged
    2-3  act, error, or omission committed in the individual's official
    2-4  capacity or within the scope of what the board member or employee
    2-5  believed in good faith, at the time, to be the board member's or
    2-6  employee's official capacity.  The board may not indemnify a board
    2-7  member or an employee for the amount of a loss that results from
    2-8  the board member's or the employee's wilful and malicious
    2-9  misconduct or gross negligence.
   2-10              (3)  The board may establish a self-insurance fund to
   2-11  pay claims for indemnification as provided by Subdivision (2) of
   2-12  this subsection.  The board shall provide that the self-insurance
   2-13  fund must be limited to an amount not to exceed the greater of
   2-14  three percent of the fund assets or $5 million.  The self-insurance
   2-15  fund shall be invested in the same manner as other assets of the
   2-16  fund, and all earnings and losses from investing the self-insurance
   2-17  fund shall be credited to the self-insurance fund unless that
   2-18  credit exceeds the limit on the self-insurance fund set by the
   2-19  board or this subdivision.  Amounts held in the self-insurance fund
   2-20  may not be included in the actuarial valuation for purposes of
   2-21  determining:
   2-22                    (A)  the city contribution rate; or
   2-23                    (B)  the assets available to satisfy the
   2-24  actuarial liabilities of the fund to pay service, disability, or
   2-25  death benefits provided by this Act.
   2-26              (4)  A decision to indemnify or make a reimbursement
   2-27  out of the self-insurance fund must be made by a majority vote of
    3-1  board members eligible to vote on the matter.  If the proposed
    3-2  indemnification or reimbursement is of a board member, that board
    3-3  member may not vote on the matter.
    3-4        SECTION 2.  Section 4, Chapter 432, Acts of the 64th
    3-5  Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
    3-6  is amended by adding Subsection (o) to read as follows:
    3-7        (o)  Notwithstanding any other provision of this Act, a
    3-8  member or survivor receiving pension or survivor benefits may make
    3-9  a one-time election to receive a smaller pension or survivor
   3-10  benefit and may make a one-time election not to receive any future
   3-11  cost-of-living increases in the pension or survivor benefits
   3-12  received by the person or the person's beneficiary.  An election
   3-13  under this subsection must be made in writing and submitted to the
   3-14  board of trustees for approval.  On the date the board grants
   3-15  approval of an election under this subsection, the election is
   3-16  irrevocable.
   3-17        SECTION 3.  Section 7(e), Chapter 432, Acts of the 64th
   3-18  Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
   3-19  is amended to read as follows:
   3-20        (e)  Any member may designate one or more beneficiaries <a
   3-21  beneficiary> to receive the total contribution made by the member
   3-22  to the fund if the member has no eligible survivors prescribed in
   3-23  Section 11 of this Act.  The member shall file a written
   3-24  designation of beneficiary with the board of trustees of the
   3-25  Firemen's Relief and Retirement Fund <stating his beneficiary>.
   3-26  Such designation shall include the name and the address of each
   3-27  <the> beneficiary.  The board shall upon the death of the member
    4-1  pay only a total amount equal to  the amount contributed by the
    4-2  member to the stated beneficiary or beneficiaries except that the
    4-3  designated beneficiary or beneficiaries of a member dying after
    4-4  August 31, 1987, are <if the board of trustees adopts Section 5(b)
    4-5  of this Act by majority vote, a designated beneficiary entitled to
    4-6  a distribution because of the death of a member after the date of
    4-7  the adoption is> entitled to receive a total amount equal to the
    4-8  amount, if any, payable pursuant to Section 5(b) of this Act as if
    4-9  the member terminated employment on the date of death.  On
   4-10  application of a member's estate, the board shall pay the estate an
   4-11  amount equal to the amount contributed by the member if the member
   4-12  failed to designate a beneficiary.  An amount payable under this
   4-13  subsection may not escheat to the state.
   4-14        SECTION 4.  Section 8, Chapter 432, Acts of the 64th
   4-15  Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
   4-16  is amended by adding Subsection (d) to read as follows:
   4-17        (d)(1)  A benefit payable on the death of a member or
   4-18  eligible beneficiary may not be paid to a person convicted of
   4-19  causing that death but instead is payable to a person who would
   4-20  have been entitled to the benefit had the convicted person
   4-21  predeceased the decedent.  If no person is entitled to the benefit
   4-22  under this subdivision, the benefit is payable to the decedent's
   4-23  estate.
   4-24              (2)  Except as provided by Subdivision (3) of this
   4-25  subsection, the board is not required to pay a benefit in the
   4-26  manner provided by Subdivision (1) of this subsection unless the
   4-27  board receives actual notice of the conviction of the person who
    5-1  would have been entitled to the benefit.
    5-2              (3)  The board may suspend payment of a benefit payable
    5-3  on the death of a member or an eligible beneficiary on indictment
    5-4  of the person who would have been entitled to the benefits, and the
    5-5  suspension shall remain in effect until final disposition of the
    5-6  charges relating to the cause of death.  If the benefit payment is
    5-7  suspended under this subdivision and the person is not convicted,
    5-8  the benefit is payable with interest computed at the rate earned by
    5-9  the fund during the time the benefit payment was suspended.
   5-10              (4)  For purposes of this subsection, a person has been
   5-11  convicted of causing the death of a member or eligible beneficiary
   5-12  if the person:
   5-13                    (A)  has pleaded guilty or nolo contendere to, or
   5-14  the person has been found guilty by a court of, an offense at the
   5-15  trial of which it is established that the person's intentional,
   5-16  knowing, or reckless act or omission caused the death of the member
   5-17  or eligible beneficiary, regardless of whether sentence is imposed
   5-18  or probated; and
   5-19                    (B)  has no appeal of the conviction pending and
   5-20  the time provided for appeal has expired.
   5-21        SECTION 5.  Section 10(d)(2), Chapter 432, Acts of the 64th
   5-22  Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
   5-23  is amended to read as follows:
   5-24              (2)  The board of trustees shall establish minimum
   5-25  physical requirements which shall not exceed the physical
   5-26  requirements established by the Commission pursuant to Section
   5-27  143.022, Local Government Code, and its subsequent amendments <9,
    6-1  Chapter 325, Acts of the 50th Legislature, 1947 (Article 1269m,
    6-2  Vernon's Texas Civil Statutes)>, for membership in the fund, which
    6-3  physical requirements shall be the same for all applicants.  At the
    6-4  time that physical examinations are administered on behalf of the
    6-5  city, each applicant shall be provided written notice that a copy
    6-6  of the results of the examination will be forwarded to the board of
    6-7  trustees of the fund to determine eligibility for membership in the
    6-8  fund and the existence of any preexisting conditions.  Within 10
    6-9  days after the date of a physical examination performed on an
   6-10  applicant for a beginning position in the fire department as
   6-11  required by Section 143.022, Local Government Code, and its
   6-12  subsequent amendments <9, Chapter 325, Acts of the 50th
   6-13  Legislature, 1947 (Article 1269m, Vernon's Texas Civil Statutes)>,
   6-14  the city shall provide to the board of trustees <shall obtain> a
   6-15  copy of all documents resulting from the physical examination.  The
   6-16  board of trustees may require additional physical examinations if
   6-17  necessary to determine whether the applicant meets the minimum
   6-18  physical requirements for membership in the fund.  The fund
   6-19  <applicant> shall pay the cost of any additional physical
   6-20  examination required by the board of trustees.  Within a reasonable
   6-21  time after receiving the examination reports of an applicant, the
   6-22  <The> board of trustees shall, on the basis of one or more physical
   6-23  examinations, determine whether the applicant meets the minimum
   6-24  physical requirements for membership in the fund.  The board of
   6-25  trustees shall notify the applicant and the chief of the fire
   6-26  department not later than 10 calendar days after the date of the
   6-27  board decision on the applicant's satisfaction of the minimum
    7-1  physical requirements <before the first day of cadet training of
    7-2  their acceptance or rejection of the applicant>.  If the board of
    7-3  trustees rejects the applicant, the applicant may request further
    7-4  examination by a board of three physicians appointed by the board
    7-5  of trustees at the expense of the applicant.  If a physician board
    7-6  finds that an applicant meets the minimum physical requirements for
    7-7  membership in the fund, the board of trustees shall accept the
    7-8  applicant for membership.  If accepted by the board of trustees,
    7-9  the applicant's membership is effective on being appointed to the
   7-10  position of probationary fire fighter.
   7-11        SECTION 6.  Section 6, Chapter 432, Acts of the 64th
   7-12  Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
   7-13  is amended to read as follows:
   7-14        Sec. 6.  Disability.  (a)  Whenever a member becomes
   7-15  physically or mentally disabled while in or as a consequence of the
   7-16  performance of his duty or becomes physically or mentally disabled
   7-17  from any cause whatsoever after he has participated in a fund for a
   7-18  period of 20 years or more, the board of trustees shall, on his
   7-19  request, or without a request, if they determine that the member is
   7-20  not capable of performing the usual and customary duties of his
   7-21  classification or position, retire the member on a monthly
   7-22  disability allowance of an amount equal to 50 percent of his
   7-23  average monthly salary for the highest 36 months during his
   7-24  participation, or so much thereof as he may have served.
   7-25        (b)  Whenever a member becomes disabled from any cause other
   7-26  than a disability acquired in the performance of his duty as a fire
   7-27  fighter, a monthly pension allowance shall be paid to the member.
    8-1  Such monthly pension allowance shall be equal to 25 percent of the
    8-2  average monthly salary of the member, plus two and one-half percent
    8-3  of the average monthly salary for each full year of service and of
    8-4  participation in a fund, except that the monthly pension allowance
    8-5  shall not exceed 50 percent of the average monthly salary.  The
    8-6  average monthly salary shall be based on the monthly average of the
    8-7  member's salary for the highest 36 months during his participation
    8-8  or so much as he may have served preceding the date of the
    8-9  retirement.
   8-10        (c)  A member is not eligible for an on-duty or off-duty
   8-11  disability pension as provided by Subsection (a) or (b) of this
   8-12  section if the member becomes disabled as a direct and proximate
   8-13  result of a condition that existed on the date the member began
   8-14  membership in the fund.  If the member is not eligible to retire
   8-15  under Section 4 of this Act, the member may elect a refund of
   8-16  benefits or, if eligible, a deferred pension under Section 5 of
   8-17  this Act.  A member has a preexisting condition under this
   8-18  subsection if the member has:
   8-19              (1)  symptoms that would cause an ordinarily prudent
   8-20  person to seek diagnosis, care, or treatment within a five-year
   8-21  period before the effective date of the member's membership in the
   8-22  fund; or
   8-23              (2)  a condition for which medical advice or treatment
   8-24  was recommended by or received from a physician within a five-year
   8-25  period before the effective date of the member's membership in the
   8-26  fund.
   8-27        (d)  If the member is eligible to be retired under the
    9-1  provisions of Section 4 of this Act, he may elect to have his
    9-2  monthly pension allowance calculated under that section.
    9-3        SECTION 7.  Section 22, Chapter 432, Acts of the 64th
    9-4  Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
    9-5  is amended to read as follows:
    9-6        Sec. 22.  EMPLOYMENT OF PROFESSIONAL INVESTMENT MANAGERS
    9-7  <COUNSELING SERVICE>.  The board of trustees may engage and employ
    9-8  professional investment managers as provided by Section 802.204,
    9-9  Government Code, and its subsequent amendments <counselors to
   9-10  advise and assist the board in the investment of the assets of the
   9-11  fund.  The investment counseling service must be provided by a
   9-12  nationally known organization whose business functions include
   9-13  rendering continuous investment advisory service to public pension
   9-14  and retirement funds.  The city may pay the entire cost of this
   9-15  counseling service; if not paid by the city the cost may be paid
   9-16  from the assets of the fund>.
   9-17        SECTION 8.  The importance of this legislation and the
   9-18  crowded condition of the calendars in both houses create an
   9-19  emergency and an imperative public necessity that the
   9-20  constitutional rule requiring bills to be read on three several
   9-21  days in each house be suspended, and this rule is hereby suspended,
   9-22  and that this Act take effect and be in force from and after its
   9-23  passage, and it is so enacted.