BILL ANALYSIS


                                                        H.B. 1559
                                        By: Turner, S. (Whitmire)
                                      Intergovernmental Relations
                                                         05-10-95
                              Senate Committee Report (Unamended)
BACKGROUND

Currently, active members of the Houston Police Officers Pension
System contribute at a rate of 8.75 percent of their base salary. 
These contributions come into the system on an after-tax basis. 
Federal tax laws make provision for the contributions to be made on
a pre-tax basis instead.  The net result of the latter approach is
to increase the take-home pay of the police force without an
additional cost to the city.

PURPOSE

As proposed, H.B. 1559 sets forth provisions relating to the
payment of member contributions to retirement systems for police
officers in certain municipalities.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Article 6243g-1, V.T.C.S., by adding Section 6A,
as follows:

     Sec. 6A.  (a)  Authorizes the governing body of a city to
     which this Act applies by ordinance or resolution to provide
     that the city pick up member contributions required by Section
     6 of this Act or Section 28, Article 6243g-3, V.T.C.S., so
     that the contributions of all members of the Police Officers'
     Pension System qualify as picked up contributions under
     Section 414(h)(2) of the Internal Revenue of 1986.  Requires
     the city, the pension board of the Police Officers' Pension
     System, and any other necessary party to implement the action
     as soon as is practicable, if the governing body of a city
     adopts an ordinance or resolution under this section.
     
     (b)  Requires contributions picked up as provided by this
       section to be included in the determination of a member's
       base salary, deposited to the individual account of the
       member on whose behalf they are made, and treated for all
       purposes under this Act or Article 6243g-3, V.T.C.S., in the
       same manner and with like effect as if they had been
       deducted from the salary of and made by the member.
       
       SECTION 2.   Emergency clause.
           Effective date: upon passage.