BILL ANALYSIS



S.B. 102
By: Bivins (Mowrey)
April 27, 1995
Committee Report (Unamended)


BACKGROUND

The Federal Insurance Contributions Act requires employers to make
a matching contribution to an employee's social security taxes.  In
1978, the state enacted legislation in which, as an alternative to
a pay raise, the state began paying 5.85 percent of the required
7.65 percent of the employee's social security contribution.  This
legislation only applied to the first $16,500 of the employee's
salary and excluded state-paid judges.

PURPOSE

As proposed, S.B. 102 provides supplemental pay for judges and
state employees while amending the state employee contribution
policy for social security taxes.

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 Section 606.064, Government Code, as follows:

     Sec. 606.064.  New title: EMPLOYEE CONTRIBUTIONS.  (a) 
     Requires each state employee to pay contributions on wages in
     the amount of the employee tax.  Deletes existing text.
     
     (b)  Provides that the obligation provided by this section
       is a condition of employment or of holding office.  Deletes
       existing Subsections (b)-(e).
       
       SECTION 2.  Amends Section 606.067(a), Government Code, to require
the legislature to appropriate, for a state employee paid from the
state treasury, an amount equal to the state's contributions under
only Section 606.063, rather than including Sections 606.064 and
606.065.

SECTION 3.  Repealer: Section 606.065, Government Code
(Contributions for Judges).

SECTION 4.  Prohibits the appropriations in the General
Appropriations Act for the state's contribution to the tax that
state employees and state-paid judges (tax) pay under the Federal
Insurance Contributions Act from taking effect.  Provides that the
state's matching contribution appropriations are not affected by
this section.

SECTION 5.  (a)  Provides that the state is not obligated to pay
any portion of the tax for persons who were not employed by state
agencies or institutions or holding office as state paid judges on
August 31, 1995.

     (b)  Requires the state to pay, in lieu of the tax,
     supplemental pay as described by Subsection (d) of this
     section to persons who were employed by the state on August
     31, 1995.
     
     (c)  Provides that a person who is employed by the state on
     August 31, 1995, remains on or after September 1, 1995, and
     leaves state service but returns within two years, is entitled
     to increased employee retirement contributions being paid to
     state employees earning the same salary who have not left
     state service.
     
     (d)  Provides that this Act is contingent on necessary
     appropriations made by the 74th Legislature.  Sets forth the
     procedures for compliance with this Act if the appropriations
     are made.
     
     (e)  Effective date: January 1, 1996.
     
     (f)  Effective date for Subsections (a) and (d), : September
     1, 1995.
     
     SECTION 6.  Emergency clause.
     

SUMMARY OF COMMITTEE ACTION

Pursuant to public notice posted on March 22, 1995, the Committee
on State Affairs convened in a public hearing on March 27, 1995 to
consider SB 102.  The Chair laid out SB 102 and recognized Rep.
Mowrey to explain the bill.  Rep. Black laid out a complete
committee substitute which was not adopted.  The following persons
testified neutrally on the bill:  Rayford Walker representing Texas
Public Employees Association; and Ken Welch representing the State
Comptroller's Office.  The following persons testified against the
bill:  Shirley Goldsmith representing the Texas Faculty
Association; and Dally Willis representing the Communications
Workers of America.  The Chair recognized Rep. Mowrey to close. 
The Chair left SB 102 pending.  In a public hearing on April 11,
1995, the Chair laid out SB 102 and recognized Rep. Junell to
explain the bill.  SB 102 was reported favorably without amendment
with the recommendation that it do pass and be printed by a record
vote of 8 ayes, 3 nays, 1 pnv, 3 absent.