H.B. No. 2711
1-1 AN ACT
1-2 relating to the administration of, benefits payable by, eligibility
1-3 for benefits payable by, and credit under programs administered by,
1-4 the Teacher Retirement System of Texas; prohibiting certain
1-5 interests in contracts; and providing for the sunset review of the
1-6 system.
1-7 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-8 SECTION 1. Section 821.001, Government Code, is amended by
1-9 adding Subdivisions (18) and (19) to read as follows:
1-10 (18) "Alternate payee" has the meaning assigned that
1-11 term by Section 804.001.
1-12 (19) "Beneficiary" means the person or entity who,
1-13 under a valid written designation or by law, is entitled to receive
1-14 benefits payable by the retirement system on the death of a member
1-15 or annuitant.
1-16 SECTION 2. Section 823.401, Government Code, is amended by
1-17 amending Subsections (c) and (f) and adding Subsection (h) to read
1-18 as follows:
1-19 (c) A member eligible to establish credit under this section
1-20 is one who has at least five <10> years of service credit in the
1-21 retirement system for actual service in public schools.
1-22 (f) The amount of service credit a member may establish
1-23 under this section may not exceed the lesser of the number of years
2-1 of membership service credit the member has in the retirement
2-2 system for actual service in public schools or 10 years.
2-3 (h) A member purchasing out-of-state service credit does not
2-4 qualify for insurance coverage until the member has 10 or more
2-5 years of membership service credit for actual service in public
2-6 schools.
2-7 SECTION 3. Section 823.402(e), Government Code, is amended
2-8 to read as follows:
2-9 (e) A member may establish credit under this section by
2-10 depositing with the retirement system for each year of
2-11 developmental leave claimed an amount equal to the sum of:
2-12 (1) the rate of member contributions required during
2-13 the <member's most recent> year of <service that preceded the
2-14 developmental> leave, times the member's annual rate of
2-15 compensation during the member's most recent year of creditable
2-16 service that preceded the year of leave <that year>; plus
2-17 (2) the amount that the state would have contributed
2-18 had the member performed membership service during the year of
2-19 leave at the member's annual rate of compensation during the most
2-20 recent year of service that preceded the leave; plus
2-21 (3) any membership fees in effect during the year of
2-22 leave.
2-23 SECTION 4. Section 823.501(b), Government Code, is amended
2-24 to read as follows:
2-25 (b) A person eligible to reinstate service credit under this
3-1 section is one who resumes membership service in the retirement
3-2 system <and subsequently performs membership service for the
3-3 shorter of the following periods:>
3-4 <(1) two consecutive years; or>
3-5 <(2) a continuous period equal in duration to the
3-6 period from the date of termination to the date of resumption of
3-7 membership>.
3-8 SECTION 5. Sections 824.101(c) and (e), Government Code, are
3-9 amended to read as follows:
3-10 (c) Only one person may be designated as beneficiary of an
3-11 optional retirement annuity under Section 824.204(c)(1) or (c)(2),
3-12 and a designation of beneficiary under either of those options may
3-13 not be made, changed, or revoked after the later of the date on
3-14 which the retirement system makes the first annuity payment to the
3-15 retiree or the date the first payment becomes due. For purposes of
3-16 this section, the term "makes payment" includes the depositing in
3-17 the mail of a payment warrant or the crediting of an account with
3-18 payment through electronic funds transfer <of the member's
3-19 retirement>.
3-20 (e) The retirement system by rule may provide for the
3-21 designation of alternate beneficiaries and may adopt other rules to
3-22 administer this section.
3-23 SECTION 6. Section 824.204(a), Government Code, is amended
3-24 to read as follows:
3-25 (a) Instead of the standard service retirement annuity
4-1 payable under Section 824.203 or an annuity reduced because of age
4-2 under Section 824.202, a retiring member may elect to receive an
4-3 optional service retirement annuity, reduced for early retirement
4-4 if applicable, under this section. An election to receive an
4-5 optional service retirement annuity must be filed with the board of
4-6 trustees not later than the effective date of retirement.
4-7 SECTION 7. Subchapter C, Chapter 824, Government Code, is
4-8 amended by adding Section 824.206 to read as follows:
4-9 Sec. 824.206. CHANGE OF SERVICE RETIREMENT ANNUITY PAYMENT
4-10 PLAN. (a) A retiree may change the retiree's choice of service
4-11 retirement annuity payment plans after the retiree's effective date
4-12 of retirement by filing written notice with the board of trustees
4-13 before the later of the date on which the retirement system makes
4-14 the first annuity payment or the date the first payment becomes
4-15 due. After the first payment has been made by the retirement
4-16 system or has become due, a retiree may not change the annuity
4-17 payment plan selected.
4-18 (b) For purposes of this section, the term "makes payment"
4-19 includes the depositing in the mail of a payment warrant or the
4-20 crediting of an account with payment through electronic funds
4-21 transfer.
4-22 (c) The retirement system may adopt rules to administer this
4-23 section.
4-24 SECTION 8. Section 824.304(d), Government Code, is
4-25 redesignated as Section 824.304(c) to read as follows:
5-1 (c) <(d)> Before the 31st day after the date on which the
5-2 medical board certifies a member's disability, the member may
5-3 reinstate withdrawn contributions and make deposits for service
5-4 previously waived, military service, and equivalent membership
5-5 service and receive service credit as provided by this subtitle.
5-6 SECTION 9. Section 824.308(a), Government Code, is amended
5-7 to read as follows:
5-8 (a) Instead of an annuity payable under Section 824.304(b),
5-9 a member retiring under that section may elect to receive an
5-10 optional disability retirement annuity under this section. An
5-11 election to receive an optional disability retirement annuity must
5-12 be filed with the board of trustees not later than the effective
5-13 date of retirement.
5-14 SECTION 10. Subchapter D, Chapter 824, Government Code, is
5-15 amended by adding Section 824.309 to read as follows:
5-16 Sec. 824.309. CHANGE OF DISABILITY RETIREMENT PAYMENT PLAN.
5-17 (a) A retiree may change the retiree's choice of disability
5-18 retirement payment plans after the retiree's effective date of
5-19 retirement by filing written notice with the board of trustees
5-20 before the later of the date on which the retirement system makes
5-21 the first annuity payment or the date the first payment becomes
5-22 due. After the first payment has been made by the retirement
5-23 system or has become due, a retiree may not change the annuity
5-24 payment plan selected.
5-25 (b) For purposes of this section, the term "makes payment"
6-1 includes the depositing in the mail of a payment warrant or the
6-2 crediting of an account with payment through electronic funds
6-3 transfer.
6-4 (c) The retirement system may adopt rules to administer this
6-5 section.
6-6 SECTION 11. Sections 824.404(b), (c), and (d), Government
6-7 Code, are amended to read as follows:
6-8 (b) If the designated beneficiary is the spouse or a
6-9 dependent parent of the decedent, the beneficiary may elect to
6-10 receive for life a monthly benefit of $150 <$100>, beginning
6-11 immediately or on the date the beneficiary becomes 65 years old,
6-12 whichever is later.
6-13 (c) If the designated beneficiary is the spouse of the
6-14 decedent and has one or more children less than 18 years old or has
6-15 custody of one or more children of the decedent who are less than
6-16 18 years old, the designated beneficiary may elect to receive:
6-17 (1) a monthly benefit of $250 <$200> payable until the
6-18 youngest child becomes 18 years old; and
6-19 (2) when the youngest child has attained the age of
6-20 18, a monthly benefit for life of $150 <$100>, beginning on the
6-21 date the beneficiary becomes 65 years old.
6-22 (d) If the designated beneficiary or beneficiaries are the
6-23 decedent's dependent children who are less than 18 years old, their
6-24 guardian may elect to receive for them:
6-25 (1) a monthly benefit of $250 <$200>, payable as long
7-1 as two or more children are less than 18 years old; and
7-2 (2) a monthly benefit of $150 <$100>, payable as long
7-3 as only one child is less than 18 years old.
7-4 SECTION 12. Subchapter A, Chapter 825, Government Code, is
7-5 amended by adding Sections 825.0031 and 825.0032 to read as
7-6 follows:
7-7 Sec. 825.0031. NONDISCRIMINATION IN APPOINTMENTS.
7-8 Appointments to the board shall be made without regard to the race,
7-9 color, disability, sex, religion, age, or national origin of the
7-10 appointees.
7-11 Sec. 825.0032. INELIGIBILITY FOR BOARD AND OF CERTAIN
7-12 EMPLOYEES. (a) Except as provided by Subsection (b), a person is
7-13 not eligible for appointment to the board if the person or the
7-14 person's spouse:
7-15 (1) is employed by or participates in the management
7-16 of a business entity or other organization receiving funds from the
7-17 retirement system; or
7-18 (2) owns or controls, directly or indirectly, more
7-19 than a 10 percent interest in a business entity or other
7-20 organization receiving funds from the retirement system.
7-21 (b) Subsection (a) does not apply to employment by,
7-22 participation in the management of, or ownership or control of an
7-23 interest in a business entity or other organization on behalf of
7-24 the retirement system.
7-25 (c) A paid officer, employee, or consultant of a Texas trade
8-1 association in the field of investment or insurance may not be a
8-2 trustee or an employee of the retirement system who is exempt from
8-3 the state's position classification plan or is compensated at or
8-4 above the amount prescribed by the General Appropriations Act for
8-5 step 1, salary group 17, of the position classification salary
8-6 schedule.
8-7 (d) A person who is the spouse of a paid officer, manager,
8-8 or consultant of a Texas trade association in the field of
8-9 investment or insurance may not be a trustee and may not be an
8-10 employee of the retirement system who is exempt from the state's
8-11 position classification plan or is compensated at or above the
8-12 amount prescribed by the General Appropriations Act for step 1,
8-13 salary group 17, of the position classification salary schedule.
8-14 (e) For the purposes of this section, a Texas trade
8-15 association is a nonprofit, cooperative, and voluntarily joined
8-16 association of business or professional competitors in this state
8-17 designed to assist its members and its industry or profession in
8-18 dealing with mutual business or professional problems and in
8-19 promoting their common interest.
8-20 (f) A person may not serve as a trustee or act as the
8-21 general counsel to the board if the person is required to register
8-22 as a lobbyist under Chapter 305 because of the person's activities
8-23 for compensation on behalf of a business or an association related
8-24 to the operation of the board.
8-25 SECTION 13. Section 825.006, Government Code, is amended to
9-1 read as follows:
9-2 Sec. 825.006. SUNSET PROVISION. The board of trustees of
9-3 the Teacher Retirement System of Texas is subject to review under
9-4 Chapter 325 (Texas Sunset Act), but is not abolished under that
9-5 chapter. The board shall be reviewed during the period in which
9-6 state agencies abolished in 1995 <1993 and every 12th year after
9-7 1993> are reviewed. This section expires September 1, 1995.
9-8 SECTION 14. Subchapter A, Chapter 825, Government Code, is
9-9 amended by adding Section 825.010 to read as follows:
9-10 Sec. 825.010. GROUNDS FOR REMOVAL OF TRUSTEE. (a) It is a
9-11 ground for removal from the board if a trustee:
9-12 (1) violates a prohibition established by Section
9-13 825.0032;
9-14 (2) cannot discharge the person's duties for a
9-15 substantial part of the term for which the person is appointed
9-16 because of illness or disability; or
9-17 (3) is absent from more than half of the regularly
9-18 scheduled board meetings that the person is eligible to attend
9-19 during a calendar year unless the absence is excused by majority
9-20 vote of the board.
9-21 (b) The validity of an action of the board is not affected
9-22 by the fact that it is taken when a ground for removal of a trustee
9-23 exists.
9-24 (c) If the executive director has knowledge that a potential
9-25 ground for removal exists, the executive director shall notify the
10-1 chairman of the board of the ground. The chairman shall then
10-2 notify the appropriate appointing officer or body that a potential
10-3 ground for removal exists.
10-4 SECTION 15. Subchapter B, Chapter 825, Government Code, is
10-5 amended by adding Sections 825.113 and 825.114 to read as follows:
10-6 Sec. 825.113. MISCELLANEOUS BOARD DUTIES. (a) The board
10-7 shall provide to its trustees and employees, as often as necessary,
10-8 information regarding their qualification for office or employment
10-9 under this chapter and their responsibilities under applicable laws
10-10 relating to standards of conduct for state officers or employees.
10-11 (b) The board shall develop and implement policies that
10-12 clearly define the respective responsibilities of the board and the
10-13 staff of the retirement system.
10-14 (c) The board shall prepare information of interest to the
10-15 retirement system's members describing the functions of the system
10-16 and the system's procedures by which complaints are filed with and
10-17 resolved by the system. The system shall make the information
10-18 available to the system's members and appropriate state agencies.
10-19 (d) The board by rule shall establish methods by which
10-20 members are notified of the name, mailing address, and telephone
10-21 number of the retirement system for the purpose of directing
10-22 complaints to the system.
10-23 (e) The board shall develop and implement policies that
10-24 provide the public with a reasonable opportunity to appear before
10-25 the board and to speak on any issue under the jurisdiction of the
11-1 board.
11-2 (f) The board shall prepare and maintain a written plan that
11-3 describes how a person who does not speak English can be provided
11-4 reasonable access to the board's programs. The board shall also
11-5 comply with federal and state laws for program and facility
11-6 accessibility.
11-7 Sec. 825.114. ADVISORY COMMITTEES. (a) The board of
11-8 trustees may establish advisory committees as it considers
11-9 necessary to assist it in performing its duties. Members of
11-10 advisory committees established under this section serve at the
11-11 pleasure of the board.
11-12 (b) Notwithstanding any other law to the contrary, the board
11-13 of trustees by rule shall determine the amount and manner of any
11-14 compensation or expense reimbursement to be paid members of an
11-15 advisory committee performing service for the retirement system for
11-16 performing the work of the advisory committee. All compensation
11-17 and expense reimbursements for an advisory committee established
11-18 under this section are payable from the expense account or the
11-19 retired school employees group insurance fund, as applicable.
11-20 (c) Notwithstanding any other law to the contrary, the size
11-21 and composition of advisory committees created by statute for the
11-22 retirement system or required by statute to be created by the
11-23 retirement system are as provided by the statute creating or
11-24 providing for the creation of the particular committee.
11-25 SECTION 16. Section 825.202, Government Code, is amended to
12-1 read as follows:
12-2 Sec. 825.202. EXECUTIVE DIRECTOR <SECRETARY>. (a) The
12-3 board of trustees, by a majority vote of all members, shall appoint
12-4 an executive director <secretary>.
12-5 (b) The executive director <secretary> may not be a member
12-6 of the board of trustees.
12-7 (c) To be eligible to serve as the executive director
12-8 <secretary>, a person must have been a citizen of this state for
12-9 the three years immediately preceding the appointment.
12-10 (d) The executive director <secretary> shall recommend to
12-11 the board actuarial and other services necessary to administer the
12-12 retirement system.
12-13 (e) Annually, the executive director <secretary> shall
12-14 prepare an itemized expense budget for the following fiscal year
12-15 and shall submit the budget to the board for review and adoption.
12-16 SECTION 17. Section 825.206, Government Code, is amended by
12-17 adding Subsection (c) to read as follows:
12-18 (c) The board of trustees annually shall evaluate the
12-19 performance of the actuary during the previous year. At least once
12-20 every three years, the board shall redesignate its actuary after
12-21 advertising for and reviewing proposals from providers of actuarial
12-22 services.
12-23 SECTION 18. Section 825.207(b), Government Code, is amended
12-24 to read as follows:
12-25 (b) The state treasurer shall pay money from the accounts of
13-1 the retirement system on warrants drawn by the comptroller of
13-2 public accounts and authorized by vouchers signed by the executive
13-3 director <secretary> or other persons designated by the board of
13-4 trustees.
13-5 SECTION 19. Sections 825.209(b) and (c), Government Code,
13-6 are amended to read as follows:
13-7 (b) The executive director <secretary> shall give a surety
13-8 bond in the amount of $25,000.
13-9 (c) The board of trustees may require any trustee or
13-10 employee of the board, other than the executive director
13-11 <secretary>, to give a surety bond in an amount determined by the
13-12 board.
13-13 SECTION 20. Subchapter C, Chapter 825, Government Code, is
13-14 amended by adding Sections 825.211, 825.212, 825.213, and 825.214
13-15 to read as follows:
13-16 Sec. 825.211. CERTAIN INTERESTS IN LOANS, INVESTMENTS, OR
13-17 CONTRACTS PROHIBITED. (a) Except as provided by Subsection (c), a
13-18 person described by Subsection (b) may not participate in or be the
13-19 beneficiary of, directly or indirectly, a loan, commitment to lend,
13-20 a guarantee or endorsement to lend, or investment by the retirement
13-21 system or a contract to advise the system or manage property or
13-22 investments for the system.
13-23 (b) The prohibition provided by Subsection (a) applies to a
13-24 trustee or employee of the retirement system, a consultant or
13-25 advisor to the retirement system, and a person related within the
14-1 second degree by consanguinity or affinity to a trustee, employee,
14-2 consultant, or advisor.
14-3 (c) The prohibition provided by Subsection (a) does not
14-4 apply to actions taken by a trustee or employee of the retirement
14-5 system within the scope of that person's official duties for the
14-6 system or actions taken by a consultant or advisor within the scope
14-7 of the services for which the person is being compensated by the
14-8 retirement system, if the actions do not involve a relationship
14-9 required to be disclosed under Section 825.212. The prohibition
14-10 provided by Subsection (a) does not apply to an indirect benefit
14-11 received resulting from retirement system membership.
14-12 Sec. 825.212. RETIREMENT SYSTEM ETHICS POLICY. (a) In
14-13 addition to any other requirements provided by law, the board of
14-14 trustees shall enforce an ethics policy as provided by this section
14-15 for employees of and consultants and advisors to the retirement
14-16 system.
14-17 (b) Each employee of the retirement system who exercises
14-18 significant decisionmaking or fiduciary authority, as determined by
14-19 the board, shall file financial disclosure statements with a person
14-20 designated by the board. The content of a financial disclosure
14-21 statement must comply substantially with the requirements of
14-22 Section 4, Chapter 421, Acts of the 63rd Legislature, Regular
14-23 Session, 1973 (Article 6252-9b, Vernon's Texas Civil Statutes). A
14-24 statement must be filed not later than the 30th day after the date
14-25 a person is employed in a significant decisionmaking or fiduciary
15-1 position and annually after employment not later than April 30.
15-2 The filing deadline may be postponed by the executive director for
15-3 not more than 60 days on written request or for an additional
15-4 period for good cause, as determined by the chairman of the board.
15-5 The retirement system shall maintain a financial disclosure
15-6 statement for at least five years after the date of its filing.
15-7 (c) An employee who has a business or commercial
15-8 relationship that could reasonably be expected to diminish the
15-9 employee's independence of judgment in the performance of the
15-10 employee's responsibilities to the retirement system shall disclose
15-11 that relationship in writing to a person designated by the board.
15-12 (d) An employee who files a disclosure statement under
15-13 Subsection (c) shall refrain from giving advice or making decisions
15-14 about matters affected by the conflict of interest unless the
15-15 board, after consultation with the general counsel of the
15-16 retirement system, expressly waives this prohibition. The
15-17 retirement system shall maintain a written record of each waiver
15-18 and the reasons for it. The board may delegate the authority to
15-19 waive prohibitions under this subsection to one or more designated
15-20 employees on a vote of a majority of the members of the board at an
15-21 open meeting called and held in compliance with Chapter 271, Acts
15-22 of the 60th Legislature, Regular Session, 1967 (Article 6252-17,
15-23 Vernon's Texas Civil Statutes). The board shall have any order
15-24 delegating authority to waive prohibitions under this section
15-25 entered into the minutes of the meeting. The board may adopt
16-1 criteria for designated employees to use to determine the kinds of
16-2 relationships that do not constitute a material conflict of
16-3 interest for purposes of this subsection.
16-4 (e) The board by rule shall adopt standards of conduct
16-5 applicable to consultants and advisors to the retirement system who
16-6 may reasonably be expected to receive more than $10,000
16-7 compensation from the system for a fiscal year or who render
16-8 important investment advice to the retirement system.
16-9 (f) A consultant or advisor who, directly or indirectly, has
16-10 a personal or private commercial or business relationship,
16-11 unrelated to the services that the consultant or advisor performs
16-12 for the retirement system, with any other party to a transaction
16-13 with the system that could reasonably be expected to diminish the
16-14 person's independence of judgment in the performance of the
16-15 person's responsibilities to the system shall disclose that
16-16 relationship in writing to the executive director.
16-17 (g) The board by rule shall require consultants and advisors
16-18 to the retirement system and brokers to file regularly with the
16-19 system a report detailing any expenditure of more than $50 made on
16-20 behalf of a trustee or employee of the system.
16-21 (h) The board shall prescribe forms for financial disclosure
16-22 statements, disclosure statements of conflicts of interest, and
16-23 waivers of the prohibition against involvement in a matter affected
16-24 by a conflict of interest. The statements and waivers are open
16-25 records. The board shall designate an employee to be the custodian
17-1 of the statements and waivers for purposes of public disclosure.
17-2 Sec. 825.213. EMPLOYMENT PRACTICES. (a) The executive
17-3 director or the executive director's designee shall develop an
17-4 intra-agency career ladder program. The program shall require
17-5 intra-agency posting of all nonentry level positions concurrently
17-6 with any public posting.
17-7 (b) The executive director or the executive director's
17-8 designee shall develop a system of annual performance evaluations.
17-9 All merit pay for system employees must be based on the system
17-10 established under this subsection.
17-11 (c) The executive director or the executive director's
17-12 designee shall prepare and maintain a written policy statement to
17-13 assure implementation of a program of equal employment opportunity
17-14 under which all personnel transactions are made without regard to
17-15 race, color, disability, sex, religion, age, or national origin.
17-16 The policy statement must include:
17-17 (1) personnel policies, including policies relating to
17-18 recruitment, evaluation, selection, appointment, training, and
17-19 promotion of personnel that are in compliance with requirements of
17-20 the Commission on Human Rights Act (Article 5221k, Vernon's Texas
17-21 Civil Statutes);
17-22 (2) a comprehensive analysis of the retirement
17-23 system's work force that meets federal and state guidelines;
17-24 (3) procedures by which a determination can be made of
17-25 significant underuse in the retirement system's work force of all
18-1 persons for whom federal or state guidelines encourage a more
18-2 equitable balance; and
18-3 (4) reasonable methods to appropriately address those
18-4 areas of significant underuse.
18-5 (d) A policy statement prepared under Subsection (c) must
18-6 cover an annual period, be updated annually and reviewed by the
18-7 Commission on Human Rights for compliance with Subsection (c), and
18-8 be filed with the governor's office.
18-9 (e) The governor's office shall deliver a biennial report to
18-10 the legislature based on the information received under Subsection
18-11 (d). The report may be made separately or as a part of other
18-12 biennial reports made to the legislature.
18-13 Sec. 825.214. FINANCIAL AUDITOR. A person employed to
18-14 perform a financial audit of the retirement system must be selected
18-15 by and report to the board of trustees.
18-16 SECTION 21. Subchapter D, Chapter 825, Government Code, is
18-17 amended by adding Section 825.3021 to read as follows:
18-18 Sec. 825.3021. APPRAISAL AND SALE OF REAL PROPERTY. If the
18-19 retirement system acquires, through foreclosure or conveyance of
18-20 deed in lieu of foreclosure, real property assets or stock in an
18-21 entity the major asset of which is real property, the retirement
18-22 system shall, not later than the 90th day after the date of
18-23 acquisition:
18-24 (1) have the real property appraised by an appraiser
18-25 who is not a trustee or employee of the retirement system and who
19-1 has received MAI or SRA;
19-2 (2) acquire a foreclosure endorsement to the
19-3 mortgagee's title insurance policy; and
19-4 (3) if the real property contains improvements, employ
19-5 an individual who is not, or a property management company that is
19-6 not owned by, a trustee or employee of the retirement system and
19-7 who is, or that employs, a CPM, CAM, or RAM to manage the property.
19-8 SECTION 22. Section 825.303(b), Government Code, is amended
19-9 to read as follows:
19-10 (b) To be eligible to lend securities under this section, a
19-11 bank or brokerage firm must:
19-12 (1) be experienced in the operation of a fully secured
19-13 securities loan program;
19-14 (2) maintain adequate capital in the prudent judgment
19-15 of the retirement system to assure the safety of the securities;
19-16 (3) execute an indemnification agreement satisfactory
19-17 in form and content to the retirement system fully indemnifying the
19-18 retirement system against loss resulting from borrower default or
19-19 the failure of the bank or brokerage firm to properly execute the
19-20 responsibilities of the bank or brokerage firm under the applicable
19-21 securities lending agreement <its operation of a securities loan
19-22 program for the system's securities>; <and>
19-23 (4) require any securities broker or dealer to whom it
19-24 lends securities belonging to the retirement system to deliver to
19-25 and maintain with the custodian collateral in the form of cash or
20-1 <United States> government securities eligible for book entry in
20-2 either the Federal Reserve System or the Participants Trust
20-3 Company, in an amount equal to not less than 100 percent of the
20-4 market value, from time to time, of the loaned securities; and
20-5 (5) comply with guidelines the board of trustees may
20-6 adopt concerning the investment of cash collateral, borrower
20-7 limits, and other items.
20-8 SECTION 23. Section 825.311, Government Code, is amended to
20-9 read as follows:
20-10 Sec. 825.311. INTEREST ACCOUNT. In the interest account the
20-11 retirement system shall:
20-12 (1) deposit all income, interest, and dividends from
20-13 deposits and investments of assets of the retirement system; <and>
20-14 (2) accumulate net capital gains and losses resulting
20-15 from the sale, call, maturity, <or> conversion, or recognition of
20-16 changes in carrying values of investments of the retirement system;
20-17 and
20-18 (3) accumulate net income or losses from other
20-19 investments <of securities>.
20-20 SECTION 24. Section 825.312(a), Government Code, is amended
20-21 to read as follows:
20-22 (a) The retirement system shall deposit in the expense
20-23 account:
20-24 (1) all membership fees required by this subtitle;
20-25 <and>
21-1 (2) money required to be deposited in the account by
21-2 Section 825.313(b)(3) or 825.313(c); and
21-3 (3) money received from the Texas Public School
21-4 Retired Employees Group Insurance Program for service performed for
21-5 the program by the retirement system.
21-6 SECTION 25. Sections 825.403(b) and (c), Government Code,
21-7 are amended to read as follows:
21-8 (b) Each employer or the employer's designated disbursing
21-9 officer, at a time and in a form prescribed by the retirement
21-10 system, shall send to the executive director <secretary> all
21-11 deductions and a certification of earnings of each member employed
21-12 by the employer.
21-13 (c) The executive director <secretary> shall deposit with
21-14 the state treasurer all deductions received by the executive
21-15 director <secretary>.
21-16 SECTION 26. Section 825.405(d), Government Code, is amended
21-17 to read as follows:
21-18 (d) The employer must remit the amount required under this
21-19 section to the executive director <secretary> at the same time that
21-20 the employer remits the member's contribution.
21-21 SECTION 27. Sections 825.410(a) and (g), Government Code,
21-22 are amended to read as follows:
21-23 (a) Payments to establish special service credit as
21-24 authorized in Sections 805.002, 823.202, 823.302, 823.304, 823.401,
21-25 823.402, 823.501, and 825.403 may be made in a lump sum or in equal
22-1 monthly installments over a period not to exceed the lesser of the
22-2 number of years of credit to be purchased or 60 months.
22-3 Installment payments are due on the first day of each calendar
22-4 month in the payment period. If an installment payment is not made
22-5 in full within 60 days after the due date, the retirement system
22-6 may refund all installment payments less fees paid on the lump sum
22-7 due when installment payments began. Partial payment of an
22-8 installment payment may be treated as nonpayment. A check returned
22-9 for insufficient funds or a closed account shall be treated as
22-10 nonpayment. When two or more consecutive monthly payments have a
22-11 returned check, a refund may be made. If the retirement system
22-12 refunds payments pursuant to this subsection, the member is not
22-13 permitted to use the installment method of payment for a period of
22-14 three years from the date of the refund.
22-15 (g) A member seeking to establish service credit by using
22-16 the installment payment method shall pay an additional fee of nine
22-17 percent per annum calculated on a declining balance method on the
22-18 lump sum due at the time the installment payment process begins.
22-19 For purposes of this subsection, the installment payment process
22-20 begins on the first business day of the month in which the first
22-21 installment payment becomes due. None of the additional fees shall
22-22 be returned to the member or a beneficiary.
22-23 SECTION 28. Section 825.503(d), Government Code, is amended
22-24 to read as follows:
22-25 (d) The executive director <secretary> or an authorized
23-1 representative may certify the authenticity of a photograph,
23-2 microphotograph, or film of a record reproduced under this section
23-3 and shall charge a fee for the certified photograph,
23-4 microphotograph, or film as provided by law.
23-5 SECTION 29. Section 825.507, Government Code, as added by
23-6 Chapter 16, Acts of the 72nd Legislature, Regular Session, 1991, is
23-7 amended to read as follows:
23-8 Sec. 825.507. Confidentiality of Information About Members,
23-9 Retirees, Annuitants, <or> Beneficiaries, OR ALTERNATE PAYEES.
23-10 (a) Information contained in records that are in the custody of
23-11 the retirement system concerning an individual member, retiree,
23-12 annuitant, <or> beneficiary, or alternate payee is confidential
23-13 under Section 3(a)(1), Chapter 424, Acts of the 63rd Legislature,
23-14 Regular Session, 1973 (Article 6252-17a, Vernon's Texas Civil
23-15 Statutes), and may not be disclosed in a form identifiable with a
23-16 specific individual unless:
23-17 (1) the information is disclosed to:
23-18 (A) the individual or the individual's attorney,
23-19 guardian, executor, administrator, conservator, or other person who
23-20 the executive director <secretary> determines is acting in the
23-21 interest of the individual or the individual's estate;
23-22 (B) a spouse or former spouse of the individual
23-23 if the executive director <secretary> determines that the
23-24 information is relevant to the spouse's or former spouse's interest
23-25 in member accounts, benefits, or other amounts payable by the
24-1 retirement system;
24-2 (C) a governmental official or employee if the
24-3 executive director <secretary> determines that disclosure of the
24-4 information requested is reasonably necessary to the performance of
24-5 the duties of the official or employee; or
24-6 (D) a person authorized by the individual in
24-7 writing to receive the information; or
24-8 (2) the information is disclosed pursuant to a
24-9 subpoena and the executive director <secretary> determines that the
24-10 individual will have a reasonable opportunity to contest the
24-11 subpoena.
24-12 (b) This section does not prevent the disclosure of the
24-13 status or identity of an individual as a member, former member,
24-14 retiree, deceased member or retiree, <or> beneficiary, or alternate
24-15 payee of the retirement system.
24-16 (c) The executive director <secretary> may designate other
24-17 employees of the retirement system to make the necessary
24-18 determinations under Subsection (a).
24-19 (d) A determination and disclosure under Subsection (a) may
24-20 be made without notice to the individual member, retiree,
24-21 annuitant, <or> beneficiary, or alternate payee.
24-22 (e) The retirement system may make not more than two
24-23 mailings a year on behalf of a nonprofit association of active or
24-24 retired school employees, for purposes of association membership
24-25 and research only, to persons identified in information contained
25-1 in records that are in the custody of the retirement system. The
25-2 nonprofit association requesting a mailing shall pay the expenses
25-3 of the mailing.
25-4 SECTION 30. Section 825.507, Government Code, as added by
25-5 Chapter 13, Acts of the 72nd Legislature, 1st Called Session, 1991,
25-6 is redesignated as Section 825.508 to read as follows:
25-7 Sec. 825.508 <825.507>. Powers of Attorney. (a) A person
25-8 entitled to payment of an annuity or other benefits administered by
25-9 the retirement system may direct the retirement system to treat as
25-10 the authorized representative of the person concerning the
25-11 disposition of the benefits an attorney-in-fact under a power of
25-12 attorney that complies with Subsection (b).
25-13 (b) The system must honor a power of attorney executed in
25-14 accordance with Chapter 1, Section 36A, Texas Probate Code.
25-15 (c) If the power of attorney is revoked, the retirement
25-16 system is not liable for payments made to or actions taken at the
25-17 request of the attorney-in-fact before the date the system receives
25-18 written notice that the power of attorney has been revoked.
25-19 SECTION 31. Subchapter F, Chapter 825, Government Code, is
25-20 amended by adding Sections 825.509, 825.510, and 825.511 to read as
25-21 follows:
25-22 Sec. 825.509. DIRECT ROLLOVERS. (a) This section applies
25-23 to distributions made on or after January 1, 1993. Notwithstanding
25-24 any law governing the retirement system that would otherwise limit
25-25 a distributee's election under this section, a distributee may
26-1 elect, at the time and in the manner prescribed by the executive
26-2 director or the executive director's designee, to have any portion
26-3 of an eligible rollover distribution from the retirement system
26-4 paid directly to an eligible retirement plan specified by the
26-5 distributee in a direct rollover.
26-6 (b) An eligible rollover distribution under this section is
26-7 any distribution of all or a portion of the balance to the credit
26-8 of the distributee, other than:
26-9 (1) a distribution that is one of a series of
26-10 substantially equal periodic payments made not less frequently than
26-11 annually for:
26-12 (A) the life or life expectancy of the
26-13 distributee;
26-14 (B) the joint lives or joint life expectancies
26-15 of the distributee and the distributee's designated beneficiary; or
26-16 (C) a specified period of 10 years or more;
26-17 (2) a distribution to the extent the distribution is
26-18 required under Section 401(a)(9), Internal Revenue Code of 1986; or
26-19 (3) the portion of a distribution that is not
26-20 includable in gross income for federal income tax purposes.
26-21 (c) An eligible retirement plan under this section is an
26-22 individual retirement account described by Section 408(a), Internal
26-23 Revenue Code of 1986, an individual retirement annuity described by
26-24 Section 408(b), Internal Revenue Code of 1986, an annuity plan
26-25 described by Section 403(a), Internal Revenue Code of 1986, or a
27-1 qualified trust described by Section 401(a), Internal Revenue Code
27-2 of 1986, that accepts the distributee's eligible rollover
27-3 distribution. However, in the case of an eligible rollover
27-4 distribution to a surviving spouse, an eligible retirement plan
27-5 under this section is an individual retirement account or
27-6 individual retirement annuity.
27-7 (d) In this section:
27-8 (1) "Direct rollover" means a payment by the
27-9 retirement system to the eligible retirement plan specified by a
27-10 distributee.
27-11 (2) "Distributee" means a person who receives an
27-12 eligible rollover distribution from the retirement system and
27-13 includes an employee or former employee and, regarding the interest
27-14 of an employee or former employee, the person's surviving spouse or
27-15 alternate payee.
27-16 Sec. 825.510. BUDGET AND INVESTMENT INFORMATION. (a) The
27-17 retirement system annually shall file with the Legislative Budget
27-18 Board a report showing investments of the retirement system as of
27-19 the last day of the preceding fiscal year, investments made or
27-20 disposed of during that year, income or losses in the various kinds
27-21 of investments, and a comparison of investment performance to
27-22 nationally recognized indexes. The report required by this
27-23 subsection is the only periodic report of investments required to
27-24 be made by the retirement system other than a report required by
27-25 Section 802.106 or a report required by the state auditor.
28-1 (b) The retirement system shall file with the Legislative
28-2 Budget Board for review and comment a copy of each proposed annual
28-3 budget of the retirement system.
28-4 Sec. 825.511. COMPLAINT FILES. (a) The retirement system
28-5 shall keep an information file about each complaint filed with the
28-6 system that the system has authority to resolve.
28-7 (b) If a written complaint is filed with the retirement
28-8 system that the system has authority to resolve, the system, at
28-9 least quarterly and until final disposition of the complaint, shall
28-10 notify the parties to the complaint of the status of the complaint
28-11 unless the notice would jeopardize an undercover investigation.
28-12 SECTION 32. Section 13.913(a), Education Code, is amended
28-13 to read as follows:
28-14 (a) Each district shall make available to its employees
28-15 group health coverage provided by a risk pool established by one or
28-16 more school districts under Chapter 172, Local Government Code, or
28-17 under a policy of insurance or group contract issued by an insurer,
28-18 a company subject to Chapter 20, Insurance Code, or a health
28-19 maintenance organization under the Texas Health Maintenance
28-20 Organization Act (Chapter 20A, Vernon's Texas Insurance Code). The
28-21 coverage must meet the substantive coverage requirements of Article
28-22 3.51-6, Insurance Code, and any other law applicable to group
28-23 health insurance policies or contracts issued in this state. The
28-24 coverage must include major medical treatment but may exclude
28-25 experimental procedures. In this subsection, "major medical
29-1 treatment" means a medical, surgical, or diagnostic procedure or
29-2 intervention that has a significant recovery period, presents a
29-3 significant risk, employs a general anesthetic, or, in the opinion
29-4 of the primary physician, involves a significant invasion of bodily
29-5 integrity that requires the extraction of bodily fluids or an
29-6 incision or that produces substantial pain, discomfort, or
29-7 debilitation. The coverage may include managed care or preventive
29-8 care and must be comparable to the basic health coverage provided
29-9 under the Texas Employees Uniform Group Insurance Benefits Act
29-10 (Article 3.50-2, Vernon's Texas Insurance Code). The cost of the
29-11 coverage may be shared by the employees and the district. Each
29-12 district shall certify the district's compliance with this
29-13 subsection to the executive director of the Teacher <Employees>
29-14 Retirement System of Texas in the manner required by the board of
29-15 trustees of the Teacher <Employees> Retirement System of Texas.
29-16 The certification must include a copy of the district's current
29-17 contract for group health coverage.
29-18 SECTION 33. Section 2(10), Article 3.50-4, Insurance Code,
29-19 is amended to read as follows:
29-20 (10) "Retiree" means:
29-21 (A) a person who has retired under the Teacher
29-22 Retirement System of Texas, as provided by Subtitle C, Title 8,
29-23 Government Code, with at least 10 <or more> years of service credit
29-24 in the retirement system for actual service in Texas public schools
29-25 and who is not eligible to be covered by a plan provided under the
30-1 Texas Employees Uniform Group Insurance Benefits Act (Article
30-2 3.50-2, Vernon's Texas Insurance Code), or under the Texas State
30-3 College and University Employees Uniform Insurance Benefits Act
30-4 (Article 3.50-3, Vernon's Texas Insurance Code); or
30-5 (B) a person who has retired as a disability
30-6 retiree under Subtitle C, Title 8, Government Code, and is entitled
30-7 to receive monthly benefits from the retirement system.
30-8 SECTION 34. Section 8, Article 3.50-4, Insurance Code, is
30-9 amended by adding Subsection (l) to read as follows:
30-10 (l) The trustee may contract directly with health care
30-11 providers to provide benefits to participants in the program.
30-12 Those benefits may include dental care, eye care, hospital care,
30-13 surgical care and treatment, medical care and treatment,
30-14 obstetrical care, and prescription drugs, medicines, and prosthetic
30-15 devices.
30-16 SECTION 35. Article 3.50-4, Insurance Code, is amended by
30-17 adding Section 18C to read as follows:
30-18 Sec. 18C. COORDINATED CARE NETWORK. (a) The trustee may
30-19 take action as it determines to be necessary to implement and
30-20 administer a coordinated care network for the program. The trustee
30-21 may contract with health care practitioners or facilities and may
30-22 establish credentialing committees to evaluate the qualifications
30-23 of those practitioners and facilities.
30-24 (b) The trustee may contract with additional individuals or
30-25 entities as the trustee determines to be necessary to implement and
31-1 administer the network.
31-2 (c) The trustee, the Texas public school retired employees
31-3 group insurance program, the retired school employees group
31-4 insurance fund, and the board of trustees, officers, advisory
31-5 committee members, and employees of the trustee are not liable for
31-6 damages arising from the acts or omissions of health care providers
31-7 who are participating health care providers in the coordinated care
31-8 network established by the trustee. Those health care providers
31-9 are independent contractors and are responsible for their own acts
31-10 and omissions.
31-11 (d) The trustee, the Texas public school retired employees
31-12 group insurance program, the retired school employees group
31-13 insurance fund, or a member of a credentialing committee, or the
31-14 board of trustees, officers, advisory committee members, or
31-15 employees of the trustee are not liable for damages arising from
31-16 any act, statement, determination, recommendation made, or act
31-17 reported, without malice, in the course of the evaluation of the
31-18 qualifications of health care providers or of the patient care
31-19 rendered by those providers.
31-20 (e) Except as otherwise provided by this article, all
31-21 proceedings and records of a credentialing committee are
31-22 confidential, and all communications made to a credentialing
31-23 committee are privileged. The proceedings of a credentialing
31-24 committee are not subject to the open meetings law, Chapter 271,
31-25 Acts of the 60th Legislature, Regular Session, 1967 (Article
32-1 6252-17, Vernon's Texas Civil Statutes), and its subsequent
32-2 amendments. Except to the extent required by the constitution of
32-3 this state or the United States, the records and proceedings of a
32-4 credentialing committee and a communication made to a credentialing
32-5 committee are not subject to court subpoena.
32-6 (f) An individual, a health care provider, or a medical peer
32-7 review committee that, without malice, participates in a
32-8 credentialing committee activity or furnishes records, information,
32-9 or assistance to a credentialing committee is not liable for
32-10 damages arising from that act.
32-11 (g) Disclosure of confidential credentialing committee
32-12 information to the affected health care provider that is relevant
32-13 to the matter under review does not constitute a waiver of the
32-14 confidentiality requirements imposed under this article.
32-15 (h) A written or oral communication made to a credentialing
32-16 committee, and the records and proceedings of such a committee, may
32-17 be disclosed to appropriate state or federal agencies, national
32-18 accreditation bodies, state boards of registration or licensure, or
32-19 medical peer review committees. A disclosure under this subsection
32-20 does not constitute a waiver of the confidential and privileged
32-21 nature of the information.
32-22 (i) A credentialing committee, a person participating in a
32-23 credentialing review, a health care provider, the trustee, the
32-24 Texas public school retired employees group insurance program, or
32-25 the board of trustees, officers, advisory committee members, or
33-1 employees of the trustee that are named as defendants in any civil
33-2 action filed as a result of participation in the credentialing
33-3 process may use otherwise confidential information obtained for
33-4 legitimate internal business and professional purposes, including
33-5 use in their own defense. Use of information under this subsection
33-6 does not constitute a waiver of the confidential and privileged
33-7 nature of the information.
33-8 (j) In this section, "health care provider" means an
33-9 individual licensed as a health care practitioner, or a health care
33-10 facility.
33-11 SECTION 36. Section 2, Article 21.24-1, Insurance Code, is
33-12 amended by adding Subsection (c) to read as follows:
33-13 (c) This article applies to insurance coverage provided
33-14 under the Texas Public School Retired Employees Group Insurance Act
33-15 (Article 3.50-4, Insurance Code).
33-16 SECTION 37. (a) Monthly payments of a death or retirement
33-17 benefit annuity by the Teacher Retirement System of Texas are
33-18 increased beginning with the payment due at the end of January
33-19 1994.
33-20 (b) The increase applies only if the latest effective date
33-21 of retirement of the person on whose account the benefit is based,
33-22 or the date of death in the case of a death benefit annuity,
33-23 occurred before September 1, 1991. The increase does not apply to
33-24 payments received under Section 824.304(a), 824.404, or 824.501,
33-25 Government Code.
34-1 (c) The amount of the monthly increase is computed by
34-2 multiplying the previous monthly benefit by a percentage determined
34-3 in accordance with the following table:
34-4 Retirement Date or, if applicable, Date of Death Increase
34-5 Before September 1, 1968 5 %
34-6 On or after September 1, 1968, but before September 1, 1969 7 %
34-7 On or after September 1, 1969, but before September 1, 1970 6 %
34-8 On or after September 1, 1970, but before September 1, 1971 13 %
34-9 On or after September 1, 1971, but before September 1, 1972 12 %
34-10 On or after September 1, 1972, but before September 1, 1973 13 %
34-11 On or after September 1, 1973, but before September 1, 1974 15 %
34-12 On or after September 1, 1974, but before September 1, 1975 12 %
34-13 On or after September 1, 1975, but before September 1, 1976 10 %
34-14 On or after September 1, 1976, but before September 1, 1977 14 %
34-15 On or after September 1, 1977, but before September 1, 1978 13 %
34-16 On or after September 1, 1978, but before September 1, 1979 11 %
34-17 On or after September 1, 1979, but before September 1, 1980 10 %
34-18 On or after September 1, 1980, but before September 1, 1981 7 %
34-19 On or after September 1, 1981, but before September 1, 1991 5 %
34-20 (d) The increase for a monthly retirement annuity to a
34-21 retiree is based on the retiree's latest effective retirement date.
34-22 The increase for a monthly retirement annuity being continued to a
34-23 beneficiary after the death of the retiree is based on the
34-24 retiree's retirement date. The increase for a death benefit amount
34-25 is based on the date of death of the person on whose account the
35-1 benefit is based.
35-2 (e) The percentage increases provided for in this section
35-3 apply to monthly payments of a minimum benefit increased elsewhere
35-4 in this Act, but apply only to the amount of the monthly annuity as
35-5 of August 1, 1993. No additional increase shall be paid to an
35-6 annuitant under this section if the increase provided for elsewhere
35-7 in this Act is greater than the increase provided for in this
35-8 section. If the increase provided for in this section is less than
35-9 the increase provided for elsewhere in this Act, an annuitant shall
35-10 receive the difference as an additional increase under this
35-11 section.
35-12 SECTION 38. Section 824.304(c), Government Code, as it was
35-13 designated immediately before the effective date of this Act, is
35-14 repealed.
35-15 SECTION 39. Monthly payments of a standard service
35-16 retirement annuity made after September 1, 1993, under Section
35-17 824.203, Government Code, to persons or the beneficiaries of
35-18 persons who retired before November 1, 1991, may not be less than
35-19 $6.50 a month for each year of service credit or, for a member who
35-20 was at least 65 years old at the time of retirement, not less than
35-21 the greater of $6.50 a month for each year of service credit, or
35-22 $150 a month. The minimum benefits provided by this section are
35-23 subject to reduction in the same manner as other benefits because
35-24 of early retirement or selection of an optional retirement annuity.
35-25 SECTION 40. The Teacher Retirement System of Texas may
36-1 restore monthly payments of a survivor benefit under Section
36-2 824.404, Government Code, or its predecessor statute, to a spouse
36-3 of a deceased member or retiree that were terminated because of
36-4 remarriage before the effective date of Section 5, Chapter 570,
36-5 Acts of the 66th Legislature, 1979, on application for the benefits
36-6 by the beneficiary. Retroactive payments of the benefits may not
36-7 be made. Payments of the benefits resume beginning with the month
36-8 after the month in which the beneficiary applies for restoration of
36-9 benefits under this section.
36-10 SECTION 41. (a) A retiree who is subject to loss of
36-11 benefits under Section 824.601, Government Code, for months to
36-12 which the exception provided by Section 824.602(a)(3), Government
36-13 Code, could have applied if the retiree had executed the required
36-14 form within the time provided by Section 824.602(a)(3) before its
36-15 amendment by Chapter 13, Acts of the 72nd Legislature, 1st Called
36-16 Session, 1991, is eligible to avoid loss of the benefits or to have
36-17 any lost benefits restored by the Teacher Retirement System of
36-18 Texas.
36-19 (b) To apply under this section to have lost benefits
36-20 restored or to avoid loss of benefits, a retiree must submit a
36-21 written request to the retirement system not later than March 1,
36-22 1994.
36-23 (c) Benefits eligible to be paid under this section are
36-24 those that would have been payable between September 1, 1985, and
36-25 August 31, 1991, if the retiree had not failed to execute the
37-1 required form in a timely manner.
37-2 (d) A retiree may not apply for payment of benefits under
37-3 this section for months of employment credited under Section
37-4 823.502, Government Code. Months of employment in which a retiree
37-5 receives a monthly benefit payment under this section may not be
37-6 considered in applying Section 823.502, Government Code. Only a
37-7 retiree who is surviving on the effective date of this Act is
37-8 eligible to apply for benefits under this section.
37-9 SECTION 42. A supplemental service retirement benefit
37-10 provided for by Chapter 14, Acts of the 60th Legislature, Regular
37-11 Session, 1969, that is being paid on the effective date of this Act
37-12 to a retiree who is still living is payable to the beneficiary of
37-13 the retiree if retirement benefits will be payable to the
37-14 beneficiary on the death of the retiree.
37-15 SECTION 43. (a) All employees of the Central Education
37-16 Agency and the Texas Higher Education Coordinating Board, and
37-17 employees of the Texas Youth Commission, the Texas Department of
37-18 Criminal Justice, the Texas School for the Blind and Visually
37-19 Impaired, the Texas School for the Deaf, and any other state agency
37-20 the majority of employees of which are members of the Employees
37-21 Retirement System of Texas are subject to an election made under
37-22 this section, if the employees are contributing members of the
37-23 Teacher Retirement System of Texas on the day before the effective
37-24 date of the transfer made under the election and remain employees
37-25 of the same agency on the effective date of the transfer.
38-1 (b) An election may be made under this section to transfer
38-2 membership of all affected employees from the Teacher Retirement
38-3 System of Texas to the Employees Retirement System of Texas if the
38-4 transfer would be in the best interests of the agency and the
38-5 employees. The commissioner of education, after consultation with
38-6 the State Board of Education, may make the election for employees
38-7 of the Central Education Agency. The commissioner of higher
38-8 education, after consultation with the Texas Higher Education
38-9 Coordinating Board, may make the election for employees of that
38-10 board. The governing boards of the other agencies described by
38-11 Subsection (a) of this section may make the election for affected
38-12 employees of those agencies.
38-13 (c) Notice of an election made under this section must be
38-14 filed with the Employees Retirement System of Texas not later than
38-15 the 60th day preceding the effective date of the transfer of
38-16 membership. The effective date of a transfer of membership is
38-17 September 1, 1994, except that for employees of the Central
38-18 Education Agency, the effective date is September 1, 1993.
38-19 (d) A person who becomes employed by a state agency for
38-20 which an election is made under this section on or after the
38-21 effective date of the transfer of membership of agency employees
38-22 becomes a member of the Employees Retirement System of Texas on the
38-23 first day of employment, unless prohibited as provided by Chapter
38-24 812, Government Code.
38-25 (e) At the time of the retirement or death of a person whose
39-1 membership is transferred from the Teacher Retirement System of
39-2 Texas to the Employees Retirement System of Texas pursuant to
39-3 legislation enacted by the 73rd Legislature, Regular Session, 1993,
39-4 the Teacher Retirement System of Texas shall transfer to the
39-5 Employees Retirement System of Texas the person's service credit in
39-6 the Teacher Retirement System of Texas and an amount of money equal
39-7 to the portion of the actuarial value of any annuity that becomes
39-8 payable under Chapter 814, Government Code, that represents the
39-9 percentage of the total amount of the person's service credited in
39-10 both systems that was credited in the Teacher Retirement System of
39-11 Texas.
39-12 SECTION 44. (a) The Teacher Retirement System of Texas
39-13 shall conduct a study of coverage under and participation in the
39-14 Texas Public School Retired Employees Group Insurance Program and
39-15 potential coverage under and participation in a statewide health
39-16 insurance program for school district employees.
39-17 (b) The study shall include a survey of public school
39-18 districts to assess interest in changes to the program for retired
39-19 school employees and participation in a statewide health insurance
39-20 program for school district employees. The survey shall include
39-21 one or more proposals under which the employer would pay the major
39-22 portion of the cost of coverage for only the employee. The survey
39-23 shall elicit responses to proposals that vary some or all of the
39-24 following factors:
39-25 (1) cost to a district;
40-1 (2) cost to the employee or retiree;
40-2 (3) restrictions on a district's offering of other
40-3 health plans, including health maintenance organizations;
40-4 (4) controls on a district's ability to leave the
40-5 program, once enrolled; and
40-6 (5) cost containment features.
40-7 (c) The retirement system shall report its recommendations
40-8 and the results of its survey to the Legislative Budget Board and
40-9 the governor not later than June 30, 1994. The report shall
40-10 include recommendations on the necessary size of and methods of
40-11 financing the contingency reserves for the programs, necessary cost
40-12 containment features, and at least three options to minimize
40-13 adverse selection against the programs.
40-14 (d) Each person who is employed full-time by a public school
40-15 district in this state shall pay an annual fee of $10 to the
40-16 Teacher Retirement System of Texas in addition to any other fee
40-17 required by law. The retirement system may adopt rules for
40-18 collection of the fee. The retirement system may use a portion of
40-19 the fees collected under this subsection for the purposes of
40-20 conducting the study required by this section and also may spend
40-21 for these purposes amounts from the retired school employees group
40-22 insurance fund that are designated for administrative expenses.
40-23 The total expenditures for the study may not exceed $100,000 unless
40-24 approved by the Legislative Budget Board. Fees collected under
40-25 this subsection that are not spent for purposes of the study must
41-1 be held in trust by the retirement system to provide contingency
41-2 reserves for a statewide program for school district employees. If
41-3 a statewide program is not created by the 74th Legislature, the
41-4 legislature shall provide for a refund of the remaining fees or an
41-5 offset against other fees required.
41-6 SECTION 45. The change in law made by Section 11 of this Act
41-7 applies to benefits paid after the effective date of this Act even
41-8 if the beneficiary elected to receive the monthly benefits before
41-9 that date.
41-10 SECTION 46. This Act takes effect September 1, 1993, except
41-11 Sections 35 and 43 and this section, which take effect immediately.
41-12 SECTION 47. The importance of this legislation and the
41-13 crowded condition of the calendars in both houses create an
41-14 emergency and an imperative public necessity that the
41-15 constitutional rule requiring bills to be read on three several
41-16 days in each house be suspended, and this rule is hereby suspended,
41-17 and that this Act take effect and be in force according to its
41-18 terms, and it is so enacted.