S.B. No. 594
AN ACT
1-1 relating to the firemen's relief and retirement fund in certain
1-2 municipalities.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subsection (l), Section 2, Chapter 432, Acts of
1-5 the 64th Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil
1-6 Statutes), is amended to read as follows:
1-7 (l)(1) The board may, from fund assets, purchase from an
1-8 insurer licensed to do business in this state insurance to cover
1-9 liabilities and losses of the fund and to indemnify and hold the
1-10 members of the board and employees of the board, individually and
1-11 collectively, harmless from the effects and consequences of their
1-12 acts, omissions, and conduct within the scope of their official
1-13 capacity as fiduciaries or cofiduciaries or within the scope of
1-14 what the board member or employee believed in good faith, at the
1-15 time, to be the board member's or employee's official capacity.
1-16 However, an insurance company through which insurance is purchased
1-17 under this subsection has a cause of action against a board member
1-18 or employee to the extent that a loss results from the board
1-19 member's or employee's wilful and malicious misconduct or gross
1-20 negligence.
1-21 (2) If insurance under Subdivision (1) of this
1-22 subsection is unavailable, insufficient, inadequate, or not in
1-23 effect, the board may indemnify board members or employees of the
1-24 board for liability imposed as damages and for reasonable costs and
2-1 expenses incurred by those individuals in defense of an alleged
2-2 act, error, or omission committed in the individual's official
2-3 capacity or within the scope of what the board member or employee
2-4 believed in good faith, at the time, to be the board member's or
2-5 employee's official capacity. The board may not indemnify a board
2-6 member or an employee for the amount of a loss that results from
2-7 the board member's or the employee's wilful and malicious
2-8 misconduct or gross negligence.
2-9 (3) The board may establish a self-insurance fund to
2-10 pay claims for indemnification as provided by Subdivision (2) of
2-11 this subsection. The board shall provide that the self-insurance
2-12 fund must be limited to an amount not to exceed the greater of
2-13 three percent of the fund assets or $5 million. The self-insurance
2-14 fund shall be invested in the same manner as other assets of the
2-15 fund, and all earnings and losses from investing the self-insurance
2-16 fund shall be credited to the self-insurance fund unless that
2-17 credit exceeds the limit on the self-insurance fund set by the
2-18 board or this subdivision. Amounts held in the self-insurance fund
2-19 may not be included in the actuarial valuation for purposes of
2-20 determining:
2-21 (A) the city contribution rate; or
2-22 (B) the assets available to satisfy the
2-23 actuarial liabilities of the fund to pay service, disability, or
2-24 death benefits provided by this Act.
2-25 (4) A decision to indemnify or make a reimbursement
2-26 out of the self-insurance fund must be made by a majority vote of
2-27 board members eligible to vote on the matter. If the proposed
3-1 indemnification or reimbursement is of a board member, that board
3-2 member may not vote on the matter.
3-3 SECTION 2. Section 4, Chapter 432, Acts of the 64th
3-4 Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
3-5 is amended by adding Subsection (o) to read as follows:
3-6 (o) Notwithstanding any other provision of this Act, a
3-7 member or survivor receiving pension or survivor benefits may make
3-8 a one-time election to receive a smaller pension or survivor
3-9 benefit and may make a one-time election not to receive any future
3-10 cost-of-living increases in the pension or survivor benefits
3-11 received by the person or the person's beneficiary. An election
3-12 under this subsection must be made in writing and submitted to the
3-13 board of trustees for approval. On the date the board grants
3-14 approval of an election under this subsection, the election is
3-15 irrevocable.
3-16 SECTION 3. Section 6, Chapter 432, Acts of the 64th
3-17 Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
3-18 is amended to read as follows:
3-19 Sec. 6. Disability. (a)(1) A member is eligible for an
3-20 on-duty disability allowance under Subdivision (2) or (3) of this
3-21 subsection on:
3-22 (A) application to the board of trustees for
3-23 disability benefits by the member or the member's legal
3-24 representative;
3-25 (B) a finding by the board of trustees that the
3-26 member is physically or mentally disabled because of a bodily
3-27 injury received in, or illness caused by, the performance of the
4-1 member's duties; and
4-2 (C) a finding by the board of trustees that the
4-3 disability of the member is likely to be permanent.
4-4 (2) If the board of trustees finds that an eligible
4-5 member is not capable of performing the usual and customary duties
4-6 of the member's classification or position because of the member's
4-7 disability, the board shall retire the member on a monthly
4-8 disability allowance in an amount equal to the greater of:
4-9 (A) 50 percent of the member's average monthly
4-10 salary; or
4-11 (B) the benefit the member would have been
4-12 entitled to receive based on years of service under Section 4 of
4-13 this Act if the member had retired from service on the effective
4-14 date of the member's disability retirement.
4-15 (3) If the board of trustees finds that an eligible
4-16 member is not capable of performing any substantial gainful
4-17 activity because of the member's disability, the board shall retire
4-18 the member on a monthly disability allowance in an amount equal to
4-19 the greater of:
4-20 (A) 75 percent of the member's average monthly
4-21 salary; or
4-22 (B) the benefit the member would have been
4-23 entitled to receive based on years of service under Section 4 of
4-24 this Act if the member had retired from service on the effective
4-25 date of the member's disability retirement <Whenever a member
4-26 becomes physically or mentally disabled while in or as a
4-27 consequence of the performance of his duty or becomes physically or
5-1 mentally disabled from any cause whatsoever after he has
5-2 participated in a fund for a period of 20 years or more, the board
5-3 of trustees shall, on his request, or without a request, if they
5-4 determine that the member is not capable of performing the usual
5-5 and customary duties of his classification or position, retire the
5-6 member on a monthly disability allowance of an amount equal to 50
5-7 percent of his average monthly salary for the highest 36 months
5-8 during his participation, or so much thereof as he may have
5-9 served>.
5-10 (b)(1) A member is eligible for an off-duty disability
5-11 allowance under Subdivision (2) of this subsection on:
5-12 (A) application to the board of trustees for
5-13 disability benefits by the member or the member's legal
5-14 representative;
5-15 (B) a finding by the board of trustees that:
5-16 (i) the member is physically or mentally
5-17 disabled from any cause other than an injury received in, or
5-18 illness caused by, the performance of the member's duties; and
5-19 (ii) the member is not capable of
5-20 performing the usual and customary duties of the member's
5-21 classification or position; and
5-22 (C) a finding by the board of trustees that the
5-23 disability of the member is likely to be permanent.
5-24 (2) The board of trustees shall retire the member on a
5-25 monthly disability allowance in an amount equal to the greater of:
5-26 (A) 25 percent of the member's average monthly
5-27 salary, plus 2-1/2 percent of the member's average monthly salary
6-1 for each full year of service and participation in the fund, except
6-2 that the total monthly disability allowance under this paragraph
6-3 may not exceed 50 percent of the member's average monthly salary;
6-4 or
6-5 (B) the benefit the member would have been
6-6 entitled to receive based on years of service under Section 4 of
6-7 this Act if the member had retired from service on the effective
6-8 date of the member's disability retirement <Whenever a member
6-9 becomes disabled from any cause other than a disability acquired in
6-10 the performance of his duty as a fire fighter, a monthly pension
6-11 allowance shall be paid to the member. Such monthly pension
6-12 allowance shall be equal to 25 percent of the average monthly
6-13 salary of the member, plus two and one-half percent of the average
6-14 monthly salary for each full year of service and of participation
6-15 in a fund, except that the monthly pension allowance shall not
6-16 exceed 50 percent of the average monthly salary. The average
6-17 monthly salary shall be based on the monthly average of the
6-18 member's salary for the highest 36 months during his participation
6-19 or so much as he may have served preceding the date of the
6-20 retirement>.
6-21 (c) A member is not eligible for an on-duty or off-duty
6-22 disability allowance as provided by Subsection (a) or (b) of this
6-23 section if the member becomes disabled as a direct and proximate
6-24 result of a condition that existed on the date the member began
6-25 membership in the fund. If the member is not eligible to retire
6-26 under Section 4 of this Act, the member may elect a refund of
6-27 benefits or, if eligible, a deferred pension under Section 5 of
7-1 this Act. A member has a preexisting condition under this
7-2 subsection if the member has:
7-3 (1) symptoms that would cause an ordinarily prudent
7-4 person to seek diagnosis, care, or treatment within a five-year
7-5 period before the effective date of the member's membership in the
7-6 fund; or
7-7 (2) a condition for which medical advice or treatment
7-8 was recommended by or received from a physician within a five-year
7-9 period before the effective date of the member's membership in the
7-10 fund.
7-11 (d) The board of trustees shall determine the disability of
7-12 a member in accordance with uniform principles consistently applied
7-13 on the basis of medical or other evidence that the board determines
7-14 is necessary or desirable.
7-15 (e) In this section, "average monthly salary" means the
7-16 monthly average of the member's salary for the highest 36 months
7-17 during the member's participation in the fund or, if the member
7-18 participated in the fund for less than 36 months, the monthly
7-19 average of the member's salary for the number of months the member
7-20 participated in the fund <If the member is eligible to be retired
7-21 under the provisions of Section 4 of this Act, he may elect to have
7-22 his monthly pension allowance calculated under that section>.
7-23 SECTION 4. Subsection (e), Section 7, Chapter 432, Acts of
7-24 the 64th Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil
7-25 Statutes), is amended to read as follows:
7-26 (e) Any member may designate one or more beneficiaries <a
7-27 beneficiary> to receive the total contribution made by the member
8-1 to the fund if the member has no eligible survivors prescribed in
8-2 Section 11 of this Act. The member shall file a written
8-3 designation of beneficiary with the board of trustees of the
8-4 Firemen's Relief and Retirement Fund <stating his beneficiary>.
8-5 Such designation shall include the name and the address of each
8-6 <the> beneficiary. The board shall upon the death of the member
8-7 pay only a total amount equal to the amount contributed by the
8-8 member to the stated beneficiary or beneficiaries except that the
8-9 designated beneficiary or beneficiaries of a member dying after
8-10 August 31, 1987, are <if the board of trustees adopts Section 5(b)
8-11 of this Act by majority vote, a designated beneficiary entitled to
8-12 a distribution because of the death of a member after the date of
8-13 the adoption is> entitled to receive a total amount equal to the
8-14 amount, if any, payable pursuant to Section 5(b) of this Act as if
8-15 the member terminated employment on the date of death. On
8-16 application of a member's estate, the board shall pay the estate an
8-17 amount equal to the amount contributed by the member if the member
8-18 failed to designate a beneficiary. An amount payable under this
8-19 subsection may not escheat to the state.
8-20 SECTION 5. Section 8, Chapter 432, Acts of the 64th
8-21 Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
8-22 is amended by amending Subsection (a) and adding Subsection (d) to
8-23 read as follows:
8-24 (a) No person may be retired <either> for <total or
8-25 temporary> disability, except as provided in this Act, nor receive
8-26 any allowance from the fund, unless and until there has been filed
8-27 with the board of trustees certificates of his disability or
9-1 eligibility signed and sworn to by that person and his physician or
9-2 by any physician selected by the board of trustees. The board of
9-3 trustees, in its discretion, may require other or additional
9-4 evidence of disability before ordering retirement or payment.
9-5 (d)(1) A benefit payable on the death of a member or
9-6 eligible beneficiary may not be paid to a person convicted of
9-7 causing that death but instead is payable to a person who would
9-8 have been entitled to the benefit had the convicted person
9-9 predeceased the decedent. If no person is entitled to the benefit
9-10 under this subdivision, the benefit is payable to the decedent's
9-11 estate.
9-12 (2) Except as provided by Subdivision (3) of this
9-13 subsection, the board is not required to pay a benefit in the
9-14 manner provided by Subdivision (1) of this subsection unless the
9-15 board receives actual notice of the conviction of the person who
9-16 would have been entitled to the benefit.
9-17 (3) The board may suspend payment of a benefit payable
9-18 on the death of a member or an eligible beneficiary on indictment
9-19 of the person who would have been entitled to the benefits, and the
9-20 suspension shall remain in effect until final disposition of the
9-21 charges relating to the cause of death. If the benefit payment is
9-22 suspended under this subdivision and the person is not convicted,
9-23 the benefit is payable with interest computed at the rate earned by
9-24 the fund during the time the benefit payment was suspended.
9-25 (4) For purposes of this subsection, a person has been
9-26 convicted of causing the death of a member or eligible beneficiary
9-27 if the person:
10-1 (A) has pleaded guilty or nolo contendere to, or
10-2 the person has been found guilty by a court of, an offense at the
10-3 trial of which it is established that the person's intentional or
10-4 knowing act or omission caused the death of the member or eligible
10-5 beneficiary, regardless of whether sentence is imposed or probated;
10-6 and
10-7 (B) has no appeal of the conviction pending, and
10-8 the time provided for appeal has expired.
10-9 SECTION 6. Subdivision (2), Subsection (d), Section 10,
10-10 Chapter 432, Acts of the 64th Legislature, 1975 (Article 6243e.2,
10-11 Vernon's Texas Civil Statutes), is amended to read as follows:
10-12 (2) The board of trustees shall establish minimum
10-13 physical requirements which shall not exceed the physical
10-14 requirements established by the Commission pursuant to Section
10-15 143.022, Local Government Code, and its subsequent amendments <9,
10-16 Chapter 325, Acts of the 50th Legislature, 1947 (Article 1269m,
10-17 Vernon's Texas Civil Statutes)>, for membership in the fund, which
10-18 physical requirements shall be the same for all applicants. At the
10-19 time that physical examinations are administered on behalf of the
10-20 city, each applicant shall be provided written notice that a copy
10-21 of the results of the examination will be forwarded to the board of
10-22 trustees of the fund to determine eligibility for membership in the
10-23 fund and the existence of any preexisting conditions. Within 10
10-24 days after the date of a physical examination performed on an
10-25 applicant for a beginning position in the fire department as
10-26 required by Section 143.022, Local Government Code, and its
10-27 subsequent amendments <9, Chapter 325, Acts of the 50th
11-1 Legislature, 1947 (Article 1269m, Vernon's Texas Civil Statutes)>,
11-2 the city shall provide to the board of trustees <shall obtain> a
11-3 copy of all documents resulting from the physical examination. The
11-4 board of trustees may require additional physical examinations if
11-5 necessary to determine whether the applicant meets the minimum
11-6 physical requirements for membership in the fund. The fund
11-7 <applicant> shall pay the cost of any additional physical
11-8 examination required by the board of trustees. Within a reasonable
11-9 time after receiving the examination reports of an applicant, the
11-10 <The> board of trustees shall, on the basis of one or more physical
11-11 examinations, determine whether the applicant meets the minimum
11-12 physical requirements for membership in the fund. The board of
11-13 trustees shall notify the applicant and the chief of the fire
11-14 department not later than 10 calendar days after the date of the
11-15 board decision on the applicant's satisfaction of the minimum
11-16 physical requirements <before the first day of cadet training of
11-17 their acceptance or rejection of the applicant>. If the board of
11-18 trustees rejects the applicant, the applicant may request further
11-19 examination by a board of three physicians appointed by the board
11-20 of trustees at the expense of the applicant. If a physician board
11-21 finds that an applicant meets the minimum physical requirements for
11-22 membership in the fund, the board of trustees shall accept the
11-23 applicant for membership. If accepted by the board of trustees,
11-24 the applicant's membership is effective on being appointed to the
11-25 position of probationary fire fighter.
11-26 SECTION 7. Section 15, Chapter 432, Acts of the 64th
11-27 Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
12-1 is amended to read as follows:
12-2 Sec. 15. Medical examination of member retiring for
12-3 disability or person claiming survivor benefits as disabled child.
12-4 (a) The board of trustees, in its discretion, at any time may
12-5 cause any person retired for disability or receiving survivor
12-6 benefits as a disabled child under the provisions of this Act to
12-7 appear and undergo a medical examination by any physician appointed
12-8 or selected by the board of trustees for the purpose.
12-9 (b) A person retired for disability under Section 6(a)(3) of
12-10 this Act or a person receiving survivor benefits as a disabled
12-11 child under this Act shall file an annual report of employment
12-12 activities and earnings with the board of trustees. The board of
12-13 trustees shall establish the form of the report and the time for
12-14 filing the report.
12-15 (c) The<, and the> result of the examination, the <and>
12-16 report by the physician, and the report of employment activities
12-17 and earnings shall be considered by the board of trustees in
12-18 determining whether the relief in the case shall be continued,
12-19 increased (if less than the maximum provided), decreased, or
12-20 discontinued. Should any person receiving relief under the
12-21 provisions of this Act, after due notice from the board of
12-22 trustees, fail to appear and be reexamined or fail to file the
12-23 report of employment activities and earnings, unless excused by the
12-24 board, <fail to appear or refuse to submit to reexamination,> the
12-25 board of trustees may in its discretion reduce or entirely
12-26 discontinue relief.
12-27 SECTION 8. Section 22, Chapter 432, Acts of the 64th
13-1 Legislature, 1975 (Article 6243e.2, Vernon's Texas Civil Statutes),
13-2 is amended to read as follows:
13-3 Sec. 22. EMPLOYMENT OF PROFESSIONAL INVESTMENT MANAGERS
13-4 <COUNSELING SERVICE>. The board of trustees may engage and employ
13-5 professional investment managers as provided by Section 802.204,
13-6 Government Code, and its subsequent amendments <counselors to
13-7 advise and assist the board in the investment of the assets of the
13-8 fund. The investment counseling service must be provided by a
13-9 nationally known organization whose business functions include
13-10 rendering continuous investment advisory service to public pension
13-11 and retirement funds. The city may pay the entire cost of this
13-12 counseling service; if not paid by the city the cost may be paid
13-13 from the assets of the fund>.
13-14 SECTION 9. The importance of this legislation and the
13-15 crowded condition of the calendars in both houses create an
13-16 emergency and an imperative public necessity that the
13-17 constitutional rule requiring bills to be read on three several
13-18 days in each house be suspended, and this rule is hereby suspended,
13-19 and that this Act take effect and be in force from and after its
13-20 passage, and it is so enacted.