By: Conley H.B. No. 2066
73R3377 SOS-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the retirement system for fire fighters and police
1-3 officers in certain municipalities.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 ARTICLE 1. GENERAL PROVISIONS
1-6 SECTION 1.01. DEFINITIONS. In this Act:
1-7 (1) "Board" means the board of trustees of a fund to
1-8 which this Act applies.
1-9 (2) "Fund" means the fire fighters and police officers
1-10 pension fund of a municipality to which this Act applies.
1-11 (3) "Surviving spouse" includes a widow or a widower.
1-12 SECTION 1.02. APPLICABILITY. This Act applies to paid fire
1-13 and police departments of a municipality with a population between
1-14 750,000 and 1,000,000, according to the most recent federal census.
1-15 SECTION 1.03. STATUTORY TRUST. The fund is a statutory
1-16 trust and is not a subdivision of government. The board shall hold
1-17 in trust the assets of the fund for the sole benefit of the members
1-18 and retirees of the fund and their beneficiaries.
1-19 SECTION 1.04. EXEMPTIONS. (a) The fund is exempt from
1-20 garnishment, attachment, or judgments.
1-21 (b) The fund is exempt from giving security for appeal
1-22 costs.
1-23 ARTICLE 2. ADMINISTRATIVE PROVISIONS
1-24 SECTION 2.01. BOARD OF TRUSTEES. (a) The fund is governed
2-1 by a board of trustees consisting of the following nine members:
2-2 (1) the mayor of a municipality to which this Act
2-3 applies;
2-4 (2) two members of the governing body of a
2-5 municipality to which this Act applies, elected by that governing
2-6 body;
2-7 (3) two active fire fighters below the rank of fire
2-8 chief elected by secret ballot by the members of the fire
2-9 department who are contributing members of the fund;
2-10 (4) two active police officers below the rank of
2-11 police chief, elected by secret ballot by the members of the police
2-12 department who are contributing members of the fund;
2-13 (5) a retiree or beneficiary representative of the
2-14 fire department, elected by secret ballot by the retirees, or the
2-15 surviving spouses of the retirees, from the fire department; and
2-16 (6) a retiree or beneficiary representative of the
2-17 police department, elected by secret ballot by the retirees, or the
2-18 surviving spouses of the retirees, from the police department.
2-19 (b) The board, through its secretary, shall administer the
2-20 required elections of the retiree or beneficiary representatives by
2-21 mailing ballots to out-of-town retirees or beneficiaries. Only
2-22 retirees and surviving spouses of members are eligible to be
2-23 elected as retiree or beneficiary representatives.
2-24 (c) The board may recommend to the mayor the name of a
2-25 representative to serve on the board in the mayor's place. The
2-26 mayor is not required to adopt the recommendation.
2-27 (d) The board is independent of the control of a
3-1 municipality to which this Act applies.
3-2 SECTION 2.02. TERMS OF TRUSTEES. (a) The mayor of a
3-3 municipality to which this Act applies serves on the board for the
3-4 term of the mayor's office.
3-5 (b) The two members of the municipal governing body serve on
3-6 the board for the term of the office to which they are elected.
3-7 (c) The two active fire fighters below the rank of fire
3-8 chief serve on the board for staggered four-year terms, with one
3-9 member's term expiring every two years.
3-10 (d) The two active police officers below the rank of police
3-11 chief serve on the board for staggered four-year terms, with one
3-12 member's term expiring every two years.
3-13 (e) The retiree or beneficiary representatives serve on the
3-14 board for staggered four-year terms, with one member's term
3-15 expiring every two years.
3-16 SECTION 2.03. REMOVAL OF TRUSTEES. (a) The members of the
3-17 board who are fire fighters or police officers may be removed by a
3-18 vote of the membership of their respective departments.
3-19 (b) The members of the board who are retiree or beneficiary
3-20 representatives may be removed by a vote of the group eligible to
3-21 elect them.
3-22 (c) A petition for removal under this section must be filed
3-23 with the board within 45 days after the date the first signature on
3-24 the petition has been obtained. A signature is invalid if it is
3-25 not dated.
3-26 (d) A removal election under this section must be held
3-27 within 30 days after the date the board certifies that a proper
4-1 petition for a removal election has been signed by at least 20
4-2 percent of the membership from which the trustee was elected. A
4-3 trustee's term of service ends on the entry of an order by the
4-4 board declaring the results of a removal election under this
4-5 section to favor removal.
4-6 (e) On the date the board enters an order under Subsection
4-7 (d) of this section, the board shall call a special election to be
4-8 held not less than 20 nor more than 30 days after that date to fill
4-9 the vacancy for the unexpired term of the trustee who was removed.
4-10 The trustee who was removed is not eligible to run in the special
4-11 election but is eligible to run in all subsequent board elections
4-12 for the category in which the trustee was removed.
4-13 SECTION 2.04. OFFICERS. (a) The board shall elect a
4-14 chairman, a vice-chairman, and a secretary.
4-15 (b) The treasurer of the board is the treasurer of a
4-16 municipality to which this Act applies.
4-17 (c) The board may elect other officers it considers
4-18 necessary.
4-19 SECTION 2.05. EMPLOYEES. The board may employ an executive
4-20 director and staff as needed to administer the fund.
4-21 SECTION 2.06. MEETINGS. The board shall hold regular
4-22 monthly meetings and special meetings at the call of the chairman
4-23 or on written demand by the members of the board.
4-24 SECTION 2.07. ADVISORY COMMITTEES. (a) The chairman of the
4-25 board may appoint advisory committees that report to the board.
4-26 (b) Only members of the board may be appointed to advisory
4-27 committees under this section.
5-1 (c) The board may direct staff and advisors to assist the
5-2 advisory committees.
5-3 (d) All members of the board may attend advisory committee
5-4 meetings.
5-5 (e) Members of advisory committees serve at the pleasure of
5-6 the board.
5-7 ARTICLE 3. GENERAL POWERS AND DUTIES OF THE BOARD
5-8 SECTION 3.01. GENERAL DUTIES OF BOARD. (a) The board shall
5-9 administer the fund and shall order payments from the fund as
5-10 required by this Act.
5-11 (b) The board shall adopt rules relating to:
5-12 (1) the disbursement of the fund's assets; and
5-13 (2) the designation of beneficiaries of the fund.
5-14 (c) The board shall report annually to the governing body of
5-15 the municipality regarding the condition of the fund and the
5-16 receipts and disbursements of the fund.
5-17 SECTION 3.02. APPLICATIONS; HEARINGS. (a) The board shall
5-18 consider all cases for membership in the fund and for the
5-19 retirement and benefits of the members of the fund and all
5-20 applications for benefits by surviving spouses, children, and
5-21 dependent parents.
5-22 (b) The board shall give notice to persons asking for
5-23 membership in the fund or for a benefit to appear before the board
5-24 and offer sworn evidence.
5-25 (c) Any contributing member of the fund who is in good
5-26 standing in the fire or police department may:
5-27 (1) appear in person or by attorney to contest the
6-1 application for membership participation in the fund or for an
6-2 annuity or benefit by any person claiming to be entitled to an
6-3 annuity or benefit, either as a member or beneficiary; and
6-4 (2) offer supporting testimony.
6-5 (d) The chairman of the board may issue process for
6-6 witnesses, administer oaths to those witnesses, and examine any
6-7 witness in any manner affecting retirement or a benefit under this
6-8 Act. The process for witnesses may be served on any member of the
6-9 fire or police department. On the failure of any witness to attend
6-10 and testify, that person may be compelled to attend and testify as
6-11 in any judicial proceeding, according to the practice in a justice
6-12 court.
6-13 SECTION 3.03. ORDERS FOR DISBURSEMENTS. (a) The board
6-14 shall issue orders for disbursements signed by the chairman or
6-15 vice-chairman of the board and the secretary of the board to the
6-16 appropriate persons. The order shall state the purposes for the
6-17 payments. The board shall keep a record of those orders.
6-18 (b) At each monthly board meeting, the board shall send to
6-19 the treasurer of the board a written list of persons entitled to
6-20 the payment from the fund, stating the amount and reason for
6-21 payment. The list must be certified and signed by the chairman or
6-22 vice-chairman of the board and the secretary of the board.
6-23 (c) The fund may not be disbursed without a record vote of
6-24 the board.
6-25 ARTICLE 4. MEMBERSHIP AND CONTRIBUTIONS
6-26 SECTION 4.01. MEMBERSHIP. (a) A person becomes a member of
6-27 the fund if the person:
7-1 (1) has been appointed a fire fighter or police
7-2 officer of a municipality to which this Act applies in a position
7-3 or office established by municipal ordinance;
7-4 (2) has served any applicable probationary period;
7-5 (3) has served for six months as a fire fighter or
7-6 police officer of the municipality; and
7-7 (4) was not younger than 18 and had not attained the
7-8 age of 36 at the time of appointment.
7-9 (b) The drawing of compensation by an officer or employee in
7-10 the fire or police department for service in that department does
7-11 not of itself make that person a member of the fund.
7-12 SECTION 4.02. REINSTATEMENT. A former fund member who has
7-13 reentered the fire or police department may not be barred from
7-14 membership in the fund because of age as long as the member can
7-15 qualify for a 30-year pension on or before the member's 65th
7-16 birthday.
7-17 SECTION 4.03. MILITARY SERVICE. (a) A member of the fund
7-18 who enters active military service may not:
7-19 (1) be required to make the monthly payments into the
7-20 fund provided by this Act as long as the member is engaged in
7-21 active military service; or
7-22 (2) lose any seniority rights or retirement benefits
7-23 provided by this Act by virtue of that military service.
7-24 (b) Not later than the 90th day after the date of the
7-25 member's reinstatement to an active status in the fire or police
7-26 department, the member must:
7-27 (1) file with the secretary of the board a written
8-1 statement of intent to pay into the fund an amount equal to what
8-2 the member would have paid if the member had remained on active
8-3 status in the department during the period of the member's absence
8-4 in military service; and
8-5 (2) make that payment in full within an amount of time
8-6 after the member's return that is equal to the time the member was
8-7 absent.
8-8 (c) Except as provided by Subsection (e) of this section, if
8-9 the member does not comply with Subsection (b) of this section, the
8-10 member shall lose all credit toward the member's retirement annuity
8-11 for the length of time the member was engaged in active military
8-12 service.
8-13 (d) Credit purchased under this section may not exceed the
8-14 length of the active military service.
8-15 (e) If a member does not make the payment required under
8-16 Subsection (b) of this section within the required amount of time,
8-17 the member shall also pay interest, compounded annually, on the
8-18 required payment from the date the payment was required to the date
8-19 the payment was made. The board shall set the rate of interest.
8-20 (f) A disability resulting from either injury or disease
8-21 contracted while engaged in military service does not entitle a
8-22 member to a disability retirement annuity.
8-23 (g) A municipality to which this Act applies shall
8-24 double-match payments made to the fund under this section.
8-25 SECTION 4.04. MEMBER CONTRIBUTIONS. There shall be deducted
8-26 from the wages of each fire fighter and police officer in the
8-27 employment of a municipality to which this Act applies a percentage
9-1 of the member's total salary, excluding overtime pay, according to
9-2 the following schedule:
9-3 (1) 11.16 percent for full pay periods after September
9-4 30, 1993, but before October 1, 1994;
9-5 (2) 11.32 percent for full pay periods after September
9-6 30, 1994, but before October 1, 1995;
9-7 (3) 11.50 percent for full pay periods after September
9-8 30, 1995, but before October 1, 1996;
9-9 (4) 11.66 percent for full pay periods after September
9-10 30, 1996, but before October 1, 1997;
9-11 (5) 11.82 percent for full pay periods after September
9-12 30, 1997, but before October 1, 1998;
9-13 (6) 12 percent for full pay periods after September
9-14 30, 1998, but before October 1, 1999;
9-15 (7) 12.16 percent for full pay periods after September
9-16 30, 1999, but before October 1, 2000;
9-17 (8) 12.32 percent for full pay periods after September
9-18 30, 2000, but before October 1, 2001; and
9-19 (9) 12.50 percent for full pay periods after September
9-20 30, 2001.
9-21 SECTION 4.05. MUNICIPAL CONTRIBUTIONS. (a) A municipality
9-22 to which this Act applies shall pay into the fund an amount equal
9-23 to double the sum total of all member contributions made in
9-24 accordance with Section 4.04 of this Act.
9-25 (b) The payments into the fund by the municipality, both as
9-26 to deductions and double-matching amounts, shall be made on the
9-27 same day the contributions are deducted from the members' pay.
10-1 (c) Any donations made to the fund, and all funds received
10-2 from any source for the fund, shall be deposited in the fund at the
10-3 earliest opportunity.
10-4 (d) The municipality's double-matching amount under this
10-5 section is in place of all other payments previously required by
10-6 law to be made by the municipality.
10-7 (e) The municipal contribution is a part of the compensation
10-8 for services rendered to the municipality.
10-9 SECTION 4.06. DEFICIENCY PAYMENT BY MUNICIPALITY. A
10-10 municipality to which this Act applies shall pay the deficiency, if
10-11 any, between the actual money contributed under this Act and the
10-12 amount of municipal contributions required by this Act.
10-13 SECTION 4.07. NO REFUND OF CONTRIBUTIONS. A member of the
10-14 fund is not entitled to any refund from the fund of any portion of
10-15 the money deducted from the member's pay for the benefit of the
10-16 fund. That money is public money and the property of the fund for
10-17 the benefit of the members qualifying for benefits and for their
10-18 beneficiaries.
10-19 ARTICLE 5. MEMBER BENEFITS
10-20 SECTION 5.01. RETIREMENT BENEFITS. (a) If a member of the
10-21 fund has contributed a portion of that member's salary as provided
10-22 by this Act, and has contributed and served for 20 years or more in
10-23 the fire or police department, the board shall, on the application
10-24 of the member for a retirement annuity, authorize a retirement
10-25 annuity to the member.
10-26 (b) The board shall compute the retirement annuity of a
10-27 member who retires after September 30, 1991, on the basis of the
11-1 average of the member's total salary, excluding overtime pay, for
11-2 the highest three years of the last five years, computed from the
11-3 date of retirement, of the member's pay at the rate of two percent
11-4 for each of the first 20 years served, plus 3-1/2 percent for each
11-5 of the next 10 years served, plus one percent for each of the next
11-6 five years served, with fractional years prorated based on full
11-7 months served as a contributing member, but the annuity may not
11-8 exceed, as of the date of retirement, 80 percent of the average so
11-9 determined.
11-10 (c) A member may not receive an award from the fund for
11-11 service retirement until the member has served at least 20 years in
11-12 the fire or police department and has also contributed the required
11-13 amount of money for at least 20 years. In determining the number
11-14 of years of service in a department, the member shall be given full
11-15 credit for the time the member was actively engaged in military
11-16 service in accordance with Section 4.03 of this Act. Disciplinary
11-17 suspensions of 15 days or less may not be subtracted from a
11-18 member's service credit under this Act if the member has paid into
11-19 the fund within 30 days after the termination date of each
11-20 suspension a sum of money equal to the amount of money that would
11-21 have been deducted from that person's salary during that period of
11-22 suspension if it had not been for that suspension. A municipality
11-23 to which this Act applies shall double-match a payment made under
11-24 this subsection.
11-25 (d) If a member of the fire or police department has served
11-26 for 30 years or more in either department and has contributed a
11-27 portion of that member's salary as provided by this Act for the
12-1 same period, that member is retired automatically from service on
12-2 the member's 65th birthday.
12-3 (e) Except as provided by Subsection (f) of this section,
12-4 members of the fund at the time of their retirement shall receive
12-5 service credit for all unused sick leave accumulated by them, with
12-6 fractional years prorated based on full months of sick leave.
12-7 (f) The retirement annuity for a member under Subsection (e)
12-8 of this section may not exceed, as of the date of retirement, 80
12-9 percent of the average determined under Chapter 143, Local
12-10 Government Code, and under the ordinances of a municipality to
12-11 which this Act applies, that exceeds 90 days of accumulated sick
12-12 leave.
12-13 SECTION 5.02. RETIREMENT BENEFITS AFTER CESSATION OF
12-14 MEMBERSHIP. (a) A person who has qualified for a retirement
12-15 annuity under this Act but who has subsequently ceased to be a
12-16 member of the fund or of the fire or police department, by whatever
12-17 means or for whatever reason, is entitled to a retirement annuity
12-18 from the fund that accrued to that person before the time that
12-19 person ceased to be a member of the fund or of the fire or police
12-20 department if the person, or the person's beneficiary in the event
12-21 of the person's death, files an application for the retirement
12-22 annuity with the board within four years after the date that person
12-23 ceased to be a member of the fund or of the fire or police
12-24 department.
12-25 (b) A retirement annuity under Subsection (a) of this
12-26 section begins the first full calendar month after the month in
12-27 which the application is filed with the board.
13-1 (c) The amount of the retirement annuity under Subsection
13-2 (a) of this section is the lesser of:
13-3 (1) the amount established as of the date the person
13-4 ceased to be a member of the fund or of the fire or police
13-5 department; or
13-6 (2) the amount established as of the date the person,
13-7 or the person's beneficiary, filed an application under this
13-8 section.
13-9 SECTION 5.03. ELIGIBILITY FOR DISABILITY RETIREMENT. (a) A
13-10 member of the fund is eligible to retire and receive a disability
13-11 retirement annuity if the member:
13-12 (1) makes a written application for disability
13-13 retirement with the board;
13-14 (2) is permanently disabled through injury or disease
13-15 so as to incapacitate the member from the performance of duties and
13-16 has been off active duty for a continuous period of not less than
13-17 30 days before the date of the application for disability
13-18 retirement; and
13-19 (3) is a member in good standing of the fire or police
13-20 department in which the member is employed at the time of
13-21 retirement.
13-22 (b) A member of the fund who has a disability resulting from
13-23 injury or disease incurred while the member was engaged in active
13-24 military service is not entitled to a disability retirement annuity
13-25 based on that disability.
13-26 (c) Except as provided by Subsection (d) of this section, a
13-27 member of the fund who is on suspension and who receives a total
14-1 and permanent disability resulting from an injury or disease
14-2 incurred while the member is on suspension is eligible for a
14-3 disability retirement annuity if the suspended member makes up each
14-4 deducted contribution lost by reason of the suspension not later
14-5 than the 30th day after the date the contribution would have been
14-6 deducted from the member's pay. A municipality to which this Act
14-7 applies shall double-match all contributions made by a member under
14-8 this subsection.
14-9 (d) A member of the fund who is on indefinite suspension is
14-10 not eligible for a disability retirement annuity until the final
14-11 determination of the suspension and all appeals of that
14-12 determination are exhausted. A member of the fund who is on
14-13 indefinite suspension is not entitled to a disability retirement
14-14 annuity if the member is finally discharged. A member of the fund
14-15 who is on indefinite suspension but who is restored to duty or who
14-16 is given a suspension for a specific period is eligible for a
14-17 disability retirement annuity as provided by Subsection (a) of this
14-18 section.
14-19 (e) A member of the fund who applies for disability
14-20 retirement under this section is subject to medical examination as
14-21 determined by the board.
14-22 (f) This section does not affect any rights under Section
14-23 5.02 of this Act.
14-24 SECTION 5.04. DISABILITY RETIREMENT BENEFITS. (a) A member
14-25 who is eligible to receive a disability retirement annuity is
14-26 entitled to receive from the fund 50 percent of the average of the
14-27 member's total salary, excluding overtime pay, for the highest
15-1 three years of the last five years, computed from the date of
15-2 retirement or, if the member has served less than three years
15-3 before the date of retirement, 50 percent of the member's average
15-4 monthly salary, excluding overtime pay, or a theoretical monthly
15-5 average if service is less than a full month.
15-6 (b) All fractional years under this section are prorated
15-7 based on full months served on the fire or police department as a
15-8 contributing member of the fund.
15-9 (c) The amount of 50 percent of the average total salary,
15-10 excluding overtime pay, is the maximum amount of disability
15-11 retirement annuity for total and permanent disability.
15-12 SECTION 5.05. MEDICAL REEXAMINATION AND REDUCTION OF
15-13 DISABILITY RETIREMENT BENEFITS. (a) The board may cause a
15-14 disability retiree to undergo a medical examination or examinations
15-15 by any reputable physician or physicians selected by the board.
15-16 Based on the examination, the board shall determine whether the
15-17 disability retirement annuity shall be continued, decreased,
15-18 restored to the original amount if it had been decreased, or
15-19 discontinued, except that a disability retirement annuity may not
15-20 be discontinued unless the disability retiree has first been
15-21 accepted for reinstatement in that person's former position or
15-22 status in the fire or police department by the chief of the
15-23 respective department.
15-24 (b) For those retired because of disability before August
15-25 30, 1971, the board may change the disability retirement annuity
15-26 provided by this Act, in accordance with any change in the degree
15-27 of disability, except that the percentage used to compute the
16-1 annuity may not, except in the case of discontinuance, be reduced
16-2 to less than two percent of the base pay of a private each month,
16-3 for each year that the retiree has served and contributed a portion
16-4 of salary as provided by this Act, based on the greater of:
16-5 (1) the rate of pay at the time of the original
16-6 granting of the disability retirement annuity; or
16-7 (2) a minimum base pay of $200 each month.
16-8 (c) For those retired because of disability on or after
16-9 August 30, 1971, the percentage used to compute the disability
16-10 retirement annuity may not be reduced to less than two percent, for
16-11 each year that the retiree has served and contributed a portion of
16-12 salary.
16-13 (d) If a disability retiree, after notice, fails to undergo
16-14 a medical examination as provided by this section, the board may
16-15 reduce or entirely discontinue the retiree's disability annuity
16-16 payments.
16-17 SECTION 5.06. REMOVAL OF DISABILITY AND WAIVER ON
16-18 REINSTATEMENT. (a) If a disability retiree applies for
16-19 reinstatement to the department from which that person retired, the
16-20 disability retiree, in addition to complying with any applicable
16-21 civil service laws, shall file a written application with the board
16-22 for a discontinuance of that person's disability retirement
16-23 annuity, subject to medical examination, indicating that the person
16-24 has recovered from the disability for which that person has been
16-25 receiving disability retirement annuity payments, and certifying to
16-26 the board that the chief of the department from which that person
16-27 was retired approves that person's reinstatement.
17-1 (b) The applicant must execute a waiver on a form prescribed
17-2 by the board in which the applicant waives a second disability
17-3 retirement annuity resulting from the same disability that was the
17-4 basis of the first disability at a higher rate than the applicant
17-5 was receiving at the time of the reinstatement for a period of
17-6 three years after reinstatement. After three years of reinstated
17-7 service, any subsequent disability retirement annuity is computed
17-8 as any other disability retirement annuity.
17-9 (c) If the applicant is required to undergo retraining and
17-10 is compensated during a period before being officially reinstated,
17-11 the applicant's monthly disability retirement annuity shall be
17-12 reduced by the amount of any monthly departmental payroll benefit,
17-13 to the extent that the latter is greater.
17-14 (d) The board may approve the discontinuance of a disability
17-15 retirement annuity as provided by this Act.
17-16 SECTION 5.07. OUTSIDE INCOME PENSION REDUCTION. (a) The
17-17 board shall require each disability retiree retiring after August
17-18 22, 1979, to provide the board annually not later than May 1 of
17-19 each year with a true and complete copy of the retiree's income tax
17-20 return for the previous year.
17-21 (b) If the retiree received income from other employment,
17-22 including self-employment, during the preceding year, the board may
17-23 reduce the retiree's disability retirement annuity by the amount of
17-24 $1 for each month for each $2 of income earned by the retiree from
17-25 the other employment during each month of the previous year, except
17-26 that the disability retirement annuity may not be decreased below
17-27 an amount based on two percent of the retiree's average salary,
18-1 excluding overtime pay, computed at the time of retirement under
18-2 Section 5.04 of this Act for each year of service in the
18-3 department.
18-4 SECTION 5.08. DISCRETION OF DEPARTMENT CHIEF FOR EMPLOYMENT
18-5 OF DISABILITY RETIREE. (a) A disability retirement annuity may
18-6 not be granted or continued if the chief of the member's department
18-7 will provide the member employment within the department
18-8 commensurate with that person's physical and mental capabilities.
18-9 (b) A determination under this section is solely within the
18-10 discretion of the department chief and must be reasonably
18-11 exercised.
18-12 SECTION 5.09. COST-OF-LIVING INCREASES. (a) At or before
18-13 its regular meeting in the month of March, the board annually shall
18-14 review the Consumer's Price Index for Moderate Income Families in
18-15 Large Cities--All Items or the nearest equivalent published by the
18-16 United States Bureau of Labor Statistics for the preceding calendar
18-17 year. If that index shows an increase during the preceding
18-18 calendar year in the cost of living as compared with that index at
18-19 the close of the previous year, the board shall order an increase
18-20 of all retirement annuities by the number of full percentage points
18-21 closest to the exact amount of the increase of that index, except
18-22 that any increased retirement annuities are payable only at the
18-23 rate of 75 percent of the applicable cost-of-living percentage for
18-24 those retirees, and the beneficiaries of those retirees, who were
18-25 retired on and after August 30, 1971.
18-26 (b) The retirement annuities to which this section applies
18-27 shall be computed as of the month of January before that March
19-1 board meeting and shall continue in effect for at least one full
19-2 year until there has been an additional increase to that
19-3 cost-of-living index and the board enters another order as provided
19-4 by this section.
19-5 (c) The cost of living increase paid to any retiree or
19-6 beneficiary of a member or retiree during the first full year after
19-7 the effective date of the retirement shall be prorated on the basis
19-8 of full months retired.
19-9 SECTION 5.10. INCREASE IN EXISTING RETIREMENT ANNUITIES.
19-10 Effective October 1, 1993, all retirement annuities for members who
19-11 retired before October 1, 1989, or to the combined beneficiaries of
19-12 the retirees, are increased by $100 per month.
19-13 SECTION 5.11. COORDINATION WITH FEDERAL LAW. (a) A member
19-14 or beneficiary of a member of the fund may not accrue a service
19-15 retirement annuity; disability retirement annuity; death benefit,
19-16 whether death occurs in the line of duty or otherwise; or any other
19-17 benefit under this Act in excess of the benefit limits applicable
19-18 to the fund under Section 415 of the code. The board shall reduce
19-19 the amount of any benefit that exceeds those limits by the amount
19-20 of the excess.
19-21 (b) Annual compensation for which benefits may be paid under
19-22 this Act may not exceed $200,000 for each member or another limit
19-23 applicable under Section 401(a)(17) of the code.
19-24 (c) Accrued benefits under this Act become 100 percent
19-25 vested for all members on termination of the fund or on occurrence
19-26 of another event described in Section 401(a)(17) of the code and
19-27 become 100 percent vested for a member on the date the member
20-1 becomes 65 years of age and has completed 20 years of service.
20-2 (d) Amounts representing forfeited nonvested benefits of
20-3 terminated members may not be used to increase benefits payable
20-4 from the fund but may be used to reduce contributions for future
20-5 plan years.
20-6 (e) Distribution of benefits must begin not later than April
20-7 1 of the year following the calendar year during which the member
20-8 becomes 70-1/2 years of age and must otherwise conform to Section
20-9 401(a)(9) of the code.
20-10 (f) The fund shall be administered in a manner complying
20-11 with Section 401(a)(25) of the code, relating to actuarial
20-12 assumptions.
20-13 (g) This section applies to any benefit regardless of when
20-14 accrued.
20-15 (h) The board may adopt rules to administer this section. A
20-16 rule adopted by the board under this subsection is final and
20-17 binding.
20-18 (i) In this section, "code" means the Internal Revenue Code
20-19 of 1986 and its subsequent amendments.
20-20 ARTICLE 6. DEPENDENT'S BENEFITS
20-21 SECTION 6.01. MEMBER'S BENEFICIARY RIGHTS. A member of the
20-22 fund has, in addition to all rights accruing from the person's
20-23 membership, the same right to receive benefits as a beneficiary
20-24 that a nonmember who is a beneficiary has in similar circumstances
20-25 if the member's spouse also is a member of the fund.
20-26 SECTION 6.02. DEATH BENEFIT ANNUITY FOR SURVIVING SPOUSES
20-27 AND CHILDREN. (a) If a contributing member in good standing dies
21-1 before or after retirement, leaving a surviving spouse, one or more
21-2 children under the age of 17 years, or one or more unmarried
21-3 children 17 years of age or older but under 19 years of age who
21-4 attend a public or private educational institution, the surviving
21-5 spouse and the children are entitled to receive from the fund the
21-6 same percentage of the member's average total salary that the
21-7 member would have been entitled to receive as a retirement annuity,
21-8 except that the percentage may not exceed the percentage to which a
21-9 member with 25 years of service credit would be entitled. One-half
21-10 of the death benefit annuity under this subsection shall be awarded
21-11 to the eligible surviving spouse and one-half to the eligible child
21-12 or children.
21-13 (b) A child resulting from any marriage occurring after the
21-14 date of retirement of the member from a spouse who was not the
21-15 spouse on the date of retirement is not entitled to a retirement
21-16 annuity under this Act.
21-17 (c) If there are no children, the surviving spouse is
21-18 entitled to receive an amount not to exceed 57.50 percent of the
21-19 average total salary, excluding overtime pay, of the deceased
21-20 member computed as provided under Subsection (a) of this section.
21-21 (d) If there is no surviving spouse, the children are
21-22 entitled to receive not more than 28.75 percent of the average
21-23 total salary computed as provided under Subsection (a) of this
21-24 section, except that if the board determines on investigation that
21-25 the eligible children are destitute, the board may increase the
21-26 death benefit annuity to an amount not to exceed 40 percent of that
21-27 average total salary. The amount awarded under this subsection to
22-1 any child shall be paid by the board to the legal guardian of the
22-2 child.
22-3 (e) A surviving spouse of a member of the fund who died
22-4 before retirement is entitled to at least 50 percent of the
22-5 member's average total salary that the member would have been
22-6 entitled to receive as a retirement annuity.
22-7 (f) A surviving spouse of a member of the fund is entitled
22-8 to a death benefit annuity based on the member's retirement
22-9 benefits in effect on the date of retirement.
22-10 (g) A child of the member who is so mentally or physically
22-11 retarded as to be incapable of being self-supporting to any extent,
22-12 if otherwise qualified and regardless of age, has the rights of
22-13 children under 17 years of age, except that any death benefit
22-14 annuity paid under this subsection to any mentally or physically
22-15 retarded child shall be reduced to the extent of any state pension
22-16 or aid, including Medicaid, or any state-funded assistance received
22-17 by the child or children, regardless of whether the funds were made
22-18 available to the state by the federal government. In no other
22-19 instance under this Act is a child entitled to any benefit after
22-20 becoming 19 years of age.
22-21 SECTION 6.03. LIMITATION ON AMOUNT OF SURVIVING SPOUSE'S
22-22 DEATH BENEFIT ANNUITY. (a) The death benefit annuity of a
22-23 surviving spouse of a member of the fund who is killed in the line
22-24 of duty is governed by this Act.
22-25 (b) The criteria in the federal Public Safety Officers'
22-26 Benefits Act for determination of whether a police officer or fire
22-27 fighter is killed in the line of duty are adopted as controlling in
23-1 all cases filed under Subsection (c) of this section. On an
23-2 application for survivor's benefits by a surviving spouse or child,
23-3 the fund shall pay the normal benefits payable under Section 6.02
23-4 of this Act. When a benefit is payable under the Public Safety
23-5 Officers' Benefits Act, the death benefit annuity shall be
23-6 recomputed, applying Subsection (c) of this section, and any
23-7 deficiency payment shall be paid to the eligible beneficiaries.
23-8 The Public Safety Officers' Benefits Act payment is prima facie
23-9 evidence that the officer was killed in the line of duty.
23-10 (c) Notwithstanding the formulas for computing the total
23-11 amounts of annuities otherwise provided by this section, if a
23-12 member is killed in the line of duty, the member's surviving spouse
23-13 and dependent children are entitled to a death benefit annuity
23-14 equal to the total salary, excluding overtime pay, of the member at
23-15 the time of death. Rules provided by this article relating to
23-16 qualification and disqualification for and apportionment of
23-17 benefits apply to a death benefit annuity computed under this
23-18 subsection. A death benefit annuity computed under this subsection
23-19 is subject to the same cost-of-living adjustments that apply to
23-20 pensions for service retirement.
23-21 (d) In this section, "Public Safety Officers' Benefits Act"
23-22 means the Public Safety Officers' Benefits Act of 1976 (42 U.S.C.
23-23 Sections 3796-3796c) and its subsequent amendments.
23-24 SECTION 6.04. REMARRIAGE; BENEFITS AFTER TERMINATION OF
23-25 MARRIAGE. (a) The right of a surviving spouse or dependent child
23-26 to annuity payments under this Act terminates on the remarriage of
23-27 the surviving spouse, either statutory or common law, or on the
24-1 marriage of the child, as applicable.
24-2 (b) If the remarried surviving spouse or married dependent
24-3 child becomes unmarried, that person is entitled, on application,
24-4 to the greater of 75 percent of the annuity that was in effect on
24-5 the date of termination or a minimum annuity of $800 each month for
24-6 as long as that person remains unmarried.
24-7 SECTION 6.05. AFFIDAVIT OF MARITAL STATUS. (a) A surviving
24-8 spouse, a dependent beneficiary under this Act, or the guardian of
24-9 a surviving spouse or dependent beneficiary may be required by the
24-10 board to file an affidavit annually concerning the person's marital
24-11 status, or the marital status of the person's wards, or to give an
24-12 affidavit to the board at other times when probable cause exists to
24-13 suspect the possibility of marriage.
24-14 (b) If the surviving spouse, dependent beneficiary, or
24-15 guardian fails or refuses to file an affidavit required under
24-16 Subsection (a) of this section, or if an incomplete, incorrect, or
24-17 false affidavit is filed, the board may suspend annuity payments to
24-18 that person indefinitely until the person complies with the
24-19 requests and orders of the board.
24-20 SECTION 6.06. COMMON-LAW MARRIAGES. Common-law marriages
24-21 are not recognized under this Act and benefits may not be conferred
24-22 on common-law spouses as beneficiaries unless a declaration of
24-23 informal marriage was made under Section 1.92, Family Code, before
24-24 the member's death.
24-25 SECTION 6.07. SURVIVING SPOUSE'S RIGHT TO SINGLE
24-26 ENTITLEMENT. Unless otherwise provided by law, a surviving spouse
24-27 is not entitled to more than one annuity from the fund.
25-1 SECTION 6.08. LUMP-SUM DEATH BENEFIT. (a) Except as
25-2 provided by Subsection (b) of this section, a surviving spouse
25-3 whose status as such resulted from any marriage after the date of
25-4 the retirement of the member is entitled to a lump-sum death
25-5 benefit because of the member's death in the amount of:
25-6 (1) $10,000 if the marriage occurred 10 years or more
25-7 before the member's death;
25-8 (2) $7,500 if the marriage occurred 7-1/2 years before
25-9 but less than 10 years before the member's death;
25-10 (3) $5,000 if the marriage occurred five years or more
25-11 but less than 7-1/2 years before the member's death; and
25-12 (4) $2,500 if the marriage occurred 2-1/2 years or
25-13 more but less than five years before the member's death.
25-14 (b) A surviving spouse under this section is not entitled to
25-15 a lump-sum death benefit if a child is entitled to receive benefits
25-16 under this Act.
25-17 SECTION 6.09. DEATH BENEFIT ANNUITIES TO DEPENDENT PARENTS.
25-18 (a) If a member of the fire or police department who was a
25-19 contributing member of the fund in good standing dies before or
25-20 after retirement and leaves no surviving spouse or child but leaves
25-21 surviving a father and mother wholly dependent on that person for
25-22 support, the dependent father and mother are entitled to receive
25-23 one-third of the average total salary, excluding overtime pay, of
25-24 the deceased member based on the same number of years of the
25-25 member's pay as is currently provided for computations of
25-26 retirement annuities under Section 5.01(a) of this Act, the annuity
25-27 to be equally divided between the father and mother as long as they
26-1 are wholly dependent. If there is only one dependent, either
26-2 father or mother, the board shall grant the surviving dependent an
26-3 annuity not to exceed one-fourth that average total salary as
26-4 computed under this subsection.
26-5 (b) The board may, on its own initiative, make a thorough
26-6 investigation, determine the facts as to the dependency with
26-7 respect to an application for benefits made under Subsection (a) of
26-8 this section, and at any time, on the request of any beneficiary or
26-9 any contributor to the fund, reopen any award made to any member or
26-10 dependent of any member who is receiving annuity payments under
26-11 this section and discontinue those payments. The findings of the
26-12 board under this section, and all annuities granted under this
26-13 section, are final on all parties unless set aside or revoked by a
26-14 court of competent jurisdiction.
26-15 SECTION 6.10. SUSPENSION RIGHTS OF DEPENDENT PARENTS. If a
26-16 member dies who is under suspension at the time of death, including
26-17 an indefinite suspension that has not become final, the member's
26-18 dependent parents have the same rights as any other member under
26-19 this Act.
26-20 SECTION 6.11. DEATH BENEFIT FOR ACTIVE MEMBER'S ESTATE. (a)
26-21 If a member of the fire or police department in active service dies
26-22 and does not leave an eligible surviving spouse, a child under 17
26-23 years of age, a child under 19 years of age who is attending
26-24 school, a retarded child, or a dependent father or mother, the
26-25 estate of the deceased member is entitled to a death benefit
26-26 payment in the amount of $10,000 from the fund.
26-27 (b) The death benefit under this section is not payable if
27-1 the deceased member of the fund is survived by one or more
27-2 beneficiaries.
27-3 ARTICLE 7. INVESTMENTS AND FINANCIAL PROVISIONS
27-4 SECTION 7.01. TREASURER'S DUTIES. (a) All money of the
27-5 fund is payable to the treasurer of the fund for the use of the
27-6 fund.
27-7 (b) The duties imposed on the treasurer under this Act are
27-8 additional duties for which the treasurer is liable under oath and
27-9 bond as the treasurer of a municipality to which this Act applies.
27-10 (c) The treasurer is not entitled to compensation for
27-11 serving as the treasurer of the fund.
27-12 SECTION 7.02. ACCOUNTS. The accounts of the fund and of the
27-13 members shall be kept separately.
27-14 SECTION 7.03. RESERVE RETIREMENT FUND. (a) The board shall
27-15 determine a reasonably safe amount of surplus necessary to defray
27-16 reasonable expenses of administering the fund.
27-17 (b) All other assets shall be designated as reserve
27-18 retirement funds.
27-19 (c) Only the board may invest and manage the reserve
27-20 retirement funds for the sole benefit of the plan participants and
27-21 their beneficiaries.
27-22 SECTION 7.04. INVESTMENT POWERS OF THE BOARD. (a) The
27-23 board shall cause the reserve retirement funds to be invested in a
27-24 manner consistent with the care, skill, and diligence under the
27-25 prevailing circumstances that a prudent person acting in a like
27-26 capacity and familiar with matters of the type would use in the
27-27 conduct of an enterprise with a like character and like aims.
28-1 (b) The board shall diversify the investment of the fund to
28-2 minimize the risk of large losses unless under the circumstances it
28-3 is clearly prudent not to do so. In investing the assets of the
28-4 fund, the board shall be bound by the documents and instruments
28-5 governing the fund.
28-6 (c) The board may directly manage the investments of the
28-7 fund or may choose and contract for professional management
28-8 services. If the fund owns real estate, it may, at its discretion,
28-9 establish corporations described by Section 501(c)(25), Internal
28-10 Revenue Code of 1986 (26 U.S.C. Section 501), and its subsequent
28-11 amendments, to hold title to the real estate.
28-12 (d) The board shall have the ultimate responsibility for the
28-13 investment of the reserve retirement funds. The board may purchase
28-14 securities or engage in limited partnerships or make other
28-15 investments not specifically provided by this Act and shall have
28-16 the authority of exercising discretion in determining the nature,
28-17 type, quality, and size of any investment consistent with the
28-18 investment policies it establishes.
28-19 SECTION 7.05. PROFESSIONAL CONSULTANTS. (a) The board may
28-20 contract for professional investment management services, financial
28-21 consultants, independent auditors, and actuaries. Only the board
28-22 may enter into those contracts and may establish a reasonable fee
28-23 for compensation.
28-24 (b) The board may designate its own custodian or master
28-25 custodian to perform the customary duties involving the safekeeping
28-26 of the assets and the execution of transactions of either domestic
28-27 or foreign securities. The board may engage in a securities
29-1 lending program consistent with the benefits to plan participants
29-2 and their beneficiaries.
29-3 SECTION 7.06. INVESTMENT MANAGER QUALIFICATIONS. In
29-4 appointing investment managers, the board shall require that the
29-5 investment manager be:
29-6 (1) registered under the Investment Advisors Act of
29-7 1940 (15 U.S.C. Section 80b-1 et seq.);
29-8 (2) a bank as defined by that Act; or
29-9 (3) an insurance company qualified to perform
29-10 investment services under the laws of more than one state.
29-11 ARTICLE 8. MISCELLANEOUS PROVISIONS
29-12 SECTION 8.01. REPEALER. Chapter 105, Acts of the 47th
29-13 Legislature, Regular Session, 1941 (Article 6243f, Vernon's Texas
29-14 Civil Statutes), is repealed.
29-15 SECTION 8.02. EFFECTIVE DATE. This Act takes effect October
29-16 1, 1993.
29-17 SECTION 8.03. EMERGENCY. The importance of this legislation
29-18 and the crowded condition of the calendars in both houses create an
29-19 emergency and an imperative public necessity that the
29-20 constitutional rule requiring bills to be read on three several
29-21 days in each house be suspended, and this rule is hereby suspended.