H.B. No. 2168
1-1 AN ACT
1-2 relating to participation and credit in, contributions to, and
1-3 benefits and administration of the Texas Municipal Retirement
1-4 System.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 851.001(6), Government Code, is amended
1-7 to read as follows:
1-8 (6) "Compensation" means the sum of payments made to
1-9 an employee for performance of personal services, as certified on a
1-10 written payroll of an employing department, that does not exceed
1-11 any rate of compensation fixed by a governing body as the maximum
1-12 salary on which member contributions to the retirement system may
1-13 be based and does not exceed $150,000 for a calendar year, indexed
1-14 in the same manner and for the same periods as provided by Section
1-15 401(a)(17) of the Internal Revenue Code of 1986 (26 U.S.C. Section
1-16 401), and includes amounts by which payment for earnings is reduced
1-17 by reason of:
1-18 (A) employer pick-up of employee contributions
1-19 to the retirement system under Section 855.402(j);
1-20 (B) deferral of compensation under benefit plans
1-21 adopted by the employer pursuant to Section 401(k) or 457 of the
1-22 Internal Revenue Code of 1986 (26 U.S.C. Sections 401, 457);
1-23 (C) cost of benefits furnished under qualified
1-24 cafeteria plans adopted by the employer pursuant to Section 125 of
2-1 the Internal Revenue Code of 1986 (26 U.S.C. Section 125);
2-2 (D) cost of tax-sheltered annuities acquired for
2-3 the employee under Section 403(b) of the Internal Revenue Code of
2-4 1986 (26 U.S.C. Section 403); and
2-5 (E) deductions for Federal Insurance
2-6 Contribution Act taxes, federal income taxes, or other obligations
2-7 of the employee.
2-8 SECTION 2. Section 852.004(c), Government Code, is amended
2-9 to read as follows:
2-10 (c) Before a municipality that has fewer than 10 employees
2-11 who are members of the retirement system is permitted to
2-12 participate in the fund, the board of trustees may require the
2-13 municipality to provide evidence that is satisfactory to the board
2-14 that the members are in good health. The board of trustees may
2-15 allow participation in the fund by those municipal employees who
2-16 are in good health on the effective date of participation and
2-17 exclude those municipal employees who are not in good health at
2-18 that time.
2-19 SECTION 3. Section 852.005, Government Code, is amended by
2-20 adding Subsections (c) and (d) to read as follows:
2-21 (c) For the purposes of this subtitle, a fire or police
2-22 department has the standing of a municipality if:
2-23 (1) the department:
2-24 (A) was created and is operating under an
2-25 interlocal cooperation agreement that has existed at least 15 years
2-26 and was executed by two or more municipalities located in a county
2-27 with a population of at least two million;
3-1 (B) is supervised by an administrative agency
3-2 appointed by the contracting municipalities; and
3-3 (C) provides common fire protection or law
3-4 enforcement services to the contracting municipalities; and
3-5 (2) the governing body of each municipality that is a
3-6 party to the agreement has voted by ordinance or resolution to
3-7 accept responsibility, in a manner to be determined by the
3-8 participating municipalities, for all payments required of and
3-9 obligations incurred by the department under this subtitle in the
3-10 event that the interlocal cooperation agreement is dissolved or
3-11 expires, all ordinances adopted by the participating municipalities
3-12 with regard to such participation are approved by the Board of
3-13 Trustees.
3-14 (d) The governing board of the supervising administrative
3-15 agency by order may take an action for a department described by
3-16 Subsection (c) that is required or authorized by this subtitle to
3-17 be made by municipal ordinance.
3-18 SECTION 4. Section 852.108, Government Code, is amended to
3-19 read as follows:
3-20 Sec. 852.108. RESUMPTION OF SERVICE WITH SAME EMPLOYER BY
3-21 RETIREE. (a) In this section and Section 852.109, a person's
3-22 reemploying municipality is the municipality for which the person
3-23 was performing creditable service at the time of the person's
3-24 retirement under this subtitle.
3-25 (b) A person who has retired with a service retirement
3-26 benefit under this subtitle and later becomes an employee of the
3-27 person's reemploying municipality also becomes a member of the
4-1 system on the date of employment, but credits and benefits
4-2 allowable to the person under this subtitle are limited as provided
4-3 by this section. <Except as provided by this section, a retiree is
4-4 not entitled to be paid a service retirement benefit for any month
4-5 in which the retiree is regularly employed by any participating
4-6 municipality. If a retiree is paid a retirement benefit for any
4-7 month during which the retiree is ineligible as provided by this
4-8 section, the benefit otherwise payable to the retiree for
4-9 subsequent months shall be suspended for an equivalent period.
4-10 Loss of benefits pursuant to this section does not extend any
4-11 period of guaranteed benefits elected pursuant to any provision of
4-12 this subtitle.>
4-13 (c) <(b)> The retirement system shall discontinue and
4-14 suspend payments of each service retirement annuity that is allowed
4-15 because of the person's previous service with the reemploying
4-16 municipality beginning with the month the retirement system
4-17 determines that the person has again become an employee of the
4-18 reemploying municipality. After the suspension, the retirement
4-19 system may not make payments of the annuity for any month during
4-20 which the person remains an employee of the reemploying
4-21 municipality. The suspension of a benefit under this section does
4-22 not suspend payment of a benefit to an alternate payee under a
4-23 qualified domestic relations order. <For purposes of this section,
4-24 a retiree is not considered regularly employed by a participating
4-25 municipality if the retiree is employed for 700 hours or less
4-26 during any calendar year.>
4-27 (d) <(c)> Member contributions under Section 855.402 shall
5-1 be made on all compensation paid to the employee by the reemploying
5-2 municipality at the same rate as is required of other employees of
5-3 the department. The retirement system shall deposit the
5-4 contributions on receipt in an individual account for the member in
5-5 the employees saving fund and shall credit the account with
5-6 interest annually at the same rate and manner as the accounts of
5-7 other members are credited. The compensation paid to the employee
5-8 by the reemploying municipality shall be included in computing the
5-9 monthly contributions the municipality makes to the municipality
5-10 accumulation fund. <Each participating municipality that employs a
5-11 retiree shall report the fact and terms of employment and payment
5-12 of the retiree on a form prescribed by the board.>
5-13 (e) <(d)> After termination of employment with the
5-14 reemploying municipality and after filing of an application for
5-15 resumption of retirement with the board of trustees, a person
5-16 described by Subsection (b) is entitled to receive future payments
5-17 of the suspended annuity, as provided by Subsection (f), and to the
5-18 additional benefits as provided by Subsections (g), (h), and (i).
5-19 <A person who has retired under this subtitle because of service
5-20 may not rejoin the retirement system.>
5-21 (f) Monthly payments of a suspended annuity shall be resumed
5-22 in the month following the month in which employment is terminated
5-23 with the reemploying municipality, without change in the amount
5-24 except for any increase allowed under Section 854.203 or the
5-25 duration of or another condition pertaining to the suspended
5-26 benefit. Payment of the resumed benefit may not be made for any
5-27 month during which the payment was suspended under this section.
6-1 (g) If a person with credited service under this section
6-2 dies before a payment under Subsection (i) is made, the person's
6-3 beneficiary, or if there is no beneficiary surviving, the executor
6-4 or administrator of the person's estate, may elect payment as
6-5 provided by Section 854.105(c).
6-6 (h) The additional service retirement benefit allowable to a
6-7 person to whom this section applies is, at the option of that
6-8 person, either:
6-9 (1) a refund of accumulated contributions made since
6-10 reemployment plus any accrued interest on the accumulated
6-11 contributions allowed by the retirement system; or
6-12 (2) a benefit consisting of:
6-13 (A) a basic annuity actuarially determined from
6-14 the sum of the member's deposits made and accumulated since the
6-15 date the person last became a member, together with interest
6-16 accumulated on that amount since the person last became a member;
6-17 or
6-18 (B) a greater amount authorized by the
6-19 municipality under Section 855.501.
6-20 (i) The additional benefit described by Subsection (h) is
6-21 payable as a standard service retirement benefit or, at the
6-22 election of the member, any optional benefit authorized under this
6-23 subtitle that is the actuarial equivalent of the standard
6-24 retirement benefit. The first benefit payment date under this
6-25 subsection is the later of the end of the month following the last
6-26 month of employment or the end of the month following the month in
6-27 which the person files an application for payment. The first
7-1 payment may not be made if the person has resumed employment with
7-2 the reemploying municipality in a position that would make the
7-3 person an employee.
7-4 SECTION 5. Subchapter B, Chapter 852, Government Code, is
7-5 amended by adding Section 852.109 to read as follows:
7-6 Sec. 852.109. RESUMPTION OF SERVICE WITH DIFFERENT EMPLOYER
7-7 BY RETIREE. (a) If a person becomes an employee of a municipality
7-8 after beginning to receive a retirement benefit, and the
7-9 municipality is not the person's reemploying municipality, the
7-10 person again becomes a member of the retirement system, and the
7-11 person's retirement annuity is not suspended.
7-12 (b) Member contributions under Section 855.402 shall be made
7-13 on all compensation paid to the employee by the municipality at the
7-14 same rate as is required of other employees of the department. The
7-15 retirement system shall deposit the contributions on receipt in an
7-16 individual account for the member in the employees saving fund and
7-17 shall credit the account with interest at the same rate and in the
7-18 same manner as the accounts of other members are credited. The
7-19 compensation paid to the employee by the municipality shall be
7-20 included in computing the monthly contributions the municipality
7-21 makes to the municipality accumulation fund.
7-22 (c) If a person with credited service under this section
7-23 dies before a payment under Subsection (e) is made, the person's
7-24 beneficiary, or if there is no beneficiary surviving, the executor
7-25 or administrator of the person's estate, may elect payment as
7-26 provided by Section 854.105(c).
7-27 (d) The additional service retirement benefit allowable to a
8-1 person to whom this section applies is, at the option of that
8-2 person, either:
8-3 (1) a refund of accumulated contributions made since
8-4 reemployment plus any accrued interest on the accumulated
8-5 contributions allowed by the retirement system; or
8-6 (2) a benefit consisting of:
8-7 (A) a basic annuity actuarially determined from
8-8 the sum of the member's deposits made and accumulated since the
8-9 date the person last became a member together with interest
8-10 accumulated on that amount since the person last became a member
8-11 and an amount from the municipality accumulation fund equal to the
8-12 amount of the deposits credited to the member's individual account
8-13 since the person last became a member together with interest
8-14 accumulated on that amount since the person last became a member;
8-15 or
8-16 (B) a greater amount authorized by the
8-17 municipality under Section 855.501.
8-18 (e) The additional benefit described by Subsection (d) is
8-19 payable as a standard service retirement benefit or, at the
8-20 election of the member, any optional benefit authorized under this
8-21 subtitle that is the actuarial equivalent of the standard
8-22 retirement benefit. The first benefit payment date under this
8-23 subsection is the later of the end of the month following the last
8-24 month of employment or the end of the month following the month in
8-25 which the person files an application for payment. The first
8-26 payment may not be made if the person has resumed employment that
8-27 would result in suspension of a benefit.
9-1 (f) If a person became an employee of a municipality other
9-2 than the person's reemploying municipality after beginning to
9-3 receive a retirement benefit, and the person's service retirement
9-4 annuity was suspended under Section 852.108 as it existed at the
9-5 time of reemployment, the person may, on written application to the
9-6 retirement system, resume receiving the suspended annuity.
9-7 SECTION 6. The section heading to Section 853.305,
9-8 Government Code, is amended to read as follows:
9-9 Sec. 853.305. CREDIT FOR SERVICE WITH NONPARTICIPATING
9-10 MUNICIPALITY, AIRPORT AUTHORITY, OR COUNCIL OF GOVERNMENTS, OR
9-11 CERTAIN SERVICE PREVIOUSLY CANCELED <MUNICIPALITY OR WITH COUNCIL
9-12 OF GOVERNMENTS>.
9-13 SECTION 7. Sections 853.305(a), (c), and (e), Government
9-14 Code, are amended to read as follows:
9-15 (a) The governing body of a participating municipality by
9-16 ordinance may authorize the granting of restricted prior service
9-17 credit to an employee who is a member of the retirement system for
9-18 service previously performed:
9-19 (1) as an employee of any incorporated city or town in
9-20 the United States, <or of> any council of governments in this
9-21 state, or an airport board or authority governing an airport for
9-22 two cities having a combined population greater than 1,000,000, and
9-23 for which the person has not otherwise received credited service in
9-24 this system, including combined service credit under Chapter 803;
9-25 or
9-26 (2) as an employee of the state or any branch, agency,
9-27 or subdivision of the state for which the person received credited
10-1 service under the Employees Retirement System of Texas, the Teacher
10-2 Retirement System of Texas, the Judicial Retirement System of Texas
10-3 Plan One, the Judicial Retirement System of Texas Plan Two, the
10-4 Texas County and District Retirement System, or this retirement
10-5 system, and the credit for which was canceled because of withdrawal
10-6 of contributions and has not been reinstated.
10-7 (c) A member seeking to establish restricted prior service
10-8 credit under Subsection (a)(1) <this section> must obtain from the
10-9 clerk or secretary of the city or town, or from the similar
10-10 official of a council of governments or airport board or authority,
10-11 <governments,> for which the previous service was performed a
10-12 detailed statement of the service, verified by that official, and
10-13 file the statement with the clerk or secretary of the participating
10-14 municipality by which the member is employed. A member seeking to
10-15 establish restricted prior service credit under Subsection (a)(2)
10-16 must obtain from the public retirement system in which the canceled
10-17 service was credited a detailed statement of the service, verified
10-18 by an official of that retirement system, and file that statement
10-19 with the clerk or secretary of the participating municipality by
10-20 which the member is employed.
10-21 (e) On receipt of a certified copy of an approved claim, the
10-22 retirement system, if satisfied that credit for <the> service
10-23 claimed under Subsection (a)(1) has not previously been granted the
10-24 member, or that credit claimed under Subsection (a)(2) previously
10-25 existed but has been canceled and not reinstated, shall enter the
10-26 credit in the member's records.
10-27 SECTION 8. Section 853.404(d), Government Code, is amended
11-1 to read as follows:
11-2 (d) Except as provided by Subsection (e), an ordinance under
11-3 this section continues in effect for each year that the actuary
11-4 determines that all obligations charged against the municipality's
11-5 account in the municipality accumulation fund, including the
11-6 obligations to become effective the next January 1, can be funded
11-7 by the municipality within its maximum contribution rate before the
11-8 25th anniversary of the next January 1. An ordinance under this
11-9 section will cease to be in effect for future years if the actuary
11-10 cannot make that determination, but shall again take effect for
11-11 future years beginning January 1 of the first year after the
11-12 actuary can make that determination.
11-13 SECTION 9. Section 854.003, Government Code, is amended by
11-14 amending Subsections (a), (c), and (d) and adding Subsections (e),
11-15 (f), and (g) to read as follows:
11-16 (a) Except as provided by Subsections (b) and (e) <(d)>, the
11-17 effective date of a member's service retirement is the date the
11-18 member designates at the time the member applies for retirement
11-19 under Section 854.101, but the date must be the last day of a
11-20 calendar month and may not precede the date the member terminates
11-21 employment with all participating municipalities.
11-22 (c) Except as provided by Subsections (b) and (e), the <The>
11-23 effective date of a member's disability retirement is the date
11-24 designated on the application for retirement filed by or for the
11-25 member as provided by Section 854.301, but the date may not precede
11-26 the date the member terminates employment with all participating
11-27 municipalities.
12-1 (d) If a person who has attained age 70-1/2 terminates or
12-2 has terminated covered employment without applying for retirement
12-3 or a refund of accumulated contributions, the retirement system
12-4 shall attempt to send to that person the written notice described
12-5 by Subsection (e) as soon as is practical after the last to occur
12-6 of:
12-7 (1) the date the person attains age 70-1/2;
12-8 (2) the date the person terminates all covered
12-9 employment; or
12-10 (3) the date the person first becomes eligible for
12-11 retirement under this chapter. <If a person who has attained age
12-12 70-1/2 terminates covered employment without applying for
12-13 retirement, the retirement system shall attempt to notify that
12-14 person in writing and advise the person that the person is required
12-15 to retire. If, before the 91st day after the date the retirement
12-16 system sends the notice, the person has not filed an application
12-17 with the board for retirement, the person is considered to have
12-18 retired on the last day of the month in which the person terminated
12-19 employment with all participating municipalities and:>
12-20 <(1) to have elected to receive an annuity under
12-21 Section 854.103, if the person did not have a spouse on the date of
12-22 employment termination; or>
12-23 <(2) if the person had a spouse on the date of
12-24 employment termination, to have elected to receive an annuity under
12-25 Section 854.104(c)(1) and to have designated the person's spouse as
12-26 the beneficiary under the annuity.>
12-27 (e) The written notice shall advise the person that the
13-1 person is required to retire. If, before the 91st day after the
13-2 date the retirement system sends the notice, the person has not
13-3 filed an application for refund or retirement with the board of
13-4 trustees, the person is considered to have retired on the last day
13-5 of the month following the last to occur of the three dates listed
13-6 in Subsection (d).
13-7 (f) If a person is considered by the retirement system to
13-8 have retired as a result of Subsection (e), the person also shall
13-9 be considered:
13-10 (1) to have elected to receive an annuity under
13-11 Section 854.103, if the person did not have a spouse on the date of
13-12 employment termination; or
13-13 (2) if the person had a spouse on the date of
13-14 employment termination, to have elected to receive an annuity under
13-15 Section 854.104(c)(1) and to have designated the person's spouse as
13-16 the beneficiary under the annuity.
13-17 (g) If a person who has less than 10 years of creditable
13-18 service and who has attained age 70-1/2 has terminated covered
13-19 employment without applying for a refund of accumulated
13-20 contributions and is not eligible to retire without additional
13-21 service or age, the retirement system shall attempt to send that
13-22 person written notice in accordance with this subsection as soon as
13-23 is practical after the person has been absent from covered
13-24 employment for five consecutive years. The written notice shall
13-25 advise the person that the person is required to receive a refund
13-26 of accumulated contributions in order to avoid a tax penalty
13-27 according to the Internal Revenue Code of 1986 (Title 26, United
14-1 States Code). If, before the 91st day after the date the
14-2 retirement system sends the notice, the person has not filed an
14-3 application for refund with the board of trustees, the person is
14-4 considered to have filed an application for refund and to have
14-5 elected to have withholding taxes withheld on that refund.
14-6 SECTION 10. Section 854.004, Government Code, is amended to
14-7 read as follows:
14-8 Sec. 854.004. WHEN ANNUITY IS PAYABLE; CHANGES BEFORE FIRST
14-9 PAYMENT. (a) A retiree may change the retiree's choice of
14-10 retirement annuity payment plans or the designation of beneficiary
14-11 after the retiree's effective date of retirement by filing written
14-12 notice with the board of trustees before the later of the date on
14-13 which the retirement system makes the first payment or the date the
14-14 first annuity payment becomes due. After the first payment has
14-15 been made by the retirement system or has become due, a retiree may
14-16 not change the annuity payment plan selected and may not change the
14-17 designated beneficiary except under Section 854.006.
14-18 (b) For purposes of this section, the term "makes payment"
14-19 includes the depositing in the mail of a payment or the crediting
14-20 of an account with payment through electronic funds transfer.
14-21 (c) An annuity under this subtitle is payable for a period
14-22 beginning on the last day of the first month following the month in
14-23 which retirement occurs and ending, except as otherwise provided by
14-24 this subtitle, on the last day of the month immediately preceding
14-25 the month in which death occurs.
14-26 SECTION 11. Section 854.005(a), Government Code, is amended
14-27 to read as follows:
15-1 (a) An annuitant by written request may authorize the
15-2 retirement system to cease the annuitant's monthly payment or
15-3 reduce the annuitant's monthly payment to an amount specified in
15-4 the request. In writing, the annuitant may subsequently request
15-5 the retirement system to reinitiate or increase the annuitant's
15-6 monthly payment at or to any specified amount that does not exceed
15-7 the amount originally payable.
15-8 SECTION 12. Section 854.007(a)(1), Government Code, is
15-9 amended to read as follows:
15-10 (1) "Annual benefit" means the total of all annuity
15-11 payments by the retirement system on behalf of a person who has
15-12 retired under this Subtitle <to an annuitant> during a calendar
15-13 year, including any distributive benefit payments.
15-14 SECTION 13. Section 854.007(d), Government Code, is amended
15-15 to read as follows:
15-16 (d) Except as provided by Subsections (f), (h), and (i), an
15-17 annual benefit payable by the retirement system may not exceed the
15-18 lesser of:
15-19 (1) $115,641, or another amount as adjusted each
15-20 January 1 by the secretary of the treasury under Section 415 of the
15-21 Internal Revenue Code of 1986 (26 U.S.C. Section 415) for
15-22 cost-of-living increases after January 1, 1993; or
15-23 (2) 100 percent of the former member's highest average
15-24 annual compensation, including annual cost-of-living increases
15-25 after separation from service.
15-26 SECTION 14. Section 854.007, Government Code, is amended by
15-27 adding Subsections (l) and (m) to read as follows:
16-1 (l) The annual benefit payable by the retirement system that
16-2 is otherwise limited by Subsection (d) may be increased each year
16-3 in accordance with cost-of-living adjustments by the secretary of
16-4 the treasury of the dollar limitation or the compensation
16-5 limitation, as long as the benefit does not exceed the amount that
16-6 would be payable without the limitation of Section 415 of the
16-7 Internal Revenue Code of 1986 (26 U.S.C. Section 415).
16-8 (m) The limitations provided by this section may not be
16-9 applied to reduce the benefit of any person whose retirement
16-10 benefits payable under this and all other defined benefit plans of
16-11 the member's employer do not exceed $10,000, plus the benefit
16-12 provided under Subsection (h), for the plan year or for any
16-13 previous plan year and who has not at any time participated in a
16-14 defined contribution plan maintained by the person's employer.
16-15 SECTION 15. Subchapter B, Chapter 854, Government Code, is
16-16 amended by adding Section 854.106 to read as follows:
16-17 Sec. 854.106. NO SURVIVING SPOUSE, EXECUTOR, OR
16-18 ADMINISTRATOR. (a) If a surviving spouse, or the executor or
16-19 administrator of a member's estate, would be entitled to make an
16-20 election under Section 854.105(c) because of the death of the
16-21 member, the heirs of the deceased member may make that election if:
16-22 (1) no surviving spouse exists;
16-23 (2) no petition for the appointment of a personal
16-24 representative of the member is pending or has been granted;
16-25 (3) 30 days have elapsed since the death of the
16-26 member;
16-27 (4) the value of the entire assets of the member's
17-1 estate, excluding homestead and exempt property, does not exceed
17-2 $50,000;
17-3 (5) there are not more than three heirs; and
17-4 (6) on file with the retirement system is a certified
17-5 copy of a small estates affidavit that has been approved and filed
17-6 in accordance with Section 137, Texas Probate Code, or an original
17-7 affidavit as described by Subsection (b).
17-8 (b) If no affidavit has been filed with the clerk of the
17-9 court having jurisdiction and venue as provided by Section 137 of
17-10 the Texas Probate Code, the retirement system may accept instead an
17-11 affidavit sworn to by two disinterested witnesses, by the heirs who
17-12 have legal capacity, and, if the facts warrant, by the natural
17-13 guardian or next of kin of any minor or incompetent who is also an
17-14 heir. The affidavit shall include the names and addresses of the
17-15 heirs and witnesses, establish the facts listed in Subsection (a),
17-16 include a list of the assets and liabilities of the estate, show
17-17 the facts that constitute the basis for the right of the heirs to
17-18 receive the estate, and show the fractional interests of the heirs
17-19 in the estate as a result of those facts.
17-20 (c) If the retirement system, acting through the director or
17-21 a person designated by the director, approves the affidavit, the
17-22 heirs can make the election if each heir agrees to the election.
17-23 (d) In this section, "heirs" has the meaning assigned by
17-24 Section 3, Texas Probate Code, except that the term excludes any
17-25 persons who have filed with the retirement system a proper
17-26 disclaimer or renunciation.
17-27 SECTION 16. Subchapter F, Chapter 854, Government Code, is
18-1 amended by adding Section 854.503 to read as follows:
18-2 Sec. 854.503. TRUST AS BENEFICIARY. (a) Except as provided
18-3 by Subsection (b), a member or retiree may designate a trust as
18-4 beneficiary for the payment of benefits from the retirement system.
18-5 If a trust is designated beneficiary, the beneficiary of the trust
18-6 is considered the designated beneficiary for the purpose of
18-7 determining eligibility for and the amount and duration of
18-8 benefits. The trustee is entitled to exercise any rights to elect
18-9 benefit options and name subsequent beneficiaries.
18-10 (b) A trust having more than one beneficiary may not receive
18-11 benefits to which multiple designated beneficiaries are not
18-12 eligible under this chapter.
18-13 SECTION 17. Subchapter F, Chapter 854, Government Code, is
18-14 amended by adding Section 854.504 to read as follows:
18-15 Sec. 854.504. PERSON CAUSING DEATH OF MEMBER OR ANNUITANT.
18-16 (a) A benefit payable on the death of a member or annuitant may
18-17 not be paid to a person convicted of causing that death but instead
18-18 is payable to a person who would be entitled to the benefit had the
18-19 convicted person predeceased the decedent. If no person would be
18-20 entitled to the benefit, the benefit is payable to the decedent's
18-21 estate.
18-22 (b) The retirement system is not required to pay a benefit
18-23 under Subsection (a) of this section unless it receives actual
18-24 notice of the conviction of the person who would have been entitled
18-25 to the benefits. However, the retirement system may delay payment
18-26 of a benefit payable on the death of a member or annuitant pending
18-27 the results of a criminal investigation and of legal proceedings
19-1 relating to the cause of death.
19-2 (c) The retirement system shall convert the remainder of any
19-3 annuity that would otherwise have been payable throughout the life
19-4 of the convicted person to an actuarially equivalent annuity
19-5 payable to the decedent's estate in 60 monthly annuity payments.
19-6 The time of the actuarial equivalence is the earlier of the time
19-7 the retirement system receives the notice of the conviction under
19-8 Subsection (b) or the time the retirement system begins the delay
19-9 in payment of a benefit according to Subsection (b).
19-10 (d) For the purposes of this section, a person has been
19-11 convicted of causing the death of a member or annuitant if the
19-12 person:
19-13 (1) has pleaded guilty or nolo contendere to or has
19-14 been found guilty by a court of an offense at the trial of which it
19-15 is established that the person's intentional, knowing, or reckless
19-16 act or omission resulted in the death of a person who was a member
19-17 or annuitant, regardless of whether sentence is imposed or
19-18 probated; and
19-19 (2) has no appeal of the conviction pending and the
19-20 time provided for appeal has expired.
19-21 SECTION 18. Subchapter F, Chapter 854, Government Code, is
19-22 amended by adding Section 854.505 to read as follows:
19-23 Sec. 854.505. SIMULTANEOUS DEATH OF MEMBER AND BENEFICIARY.
19-24 When a member or retiree and the spouse or beneficiary of the
19-25 member or retiree have died within a period of less than 120 hours
19-26 of each other, the member or retiree is considered to have survived
19-27 the spouse or beneficiary for the purpose of determining the rights
20-1 to amounts payable under this subtitle on the death of the member
20-2 or retiree.
20-3 SECTION 19. Section 854.602, Government Code, is amended by
20-4 adding Subsection (f) to read as follows:
20-5 (f) If a member included in the coverage of the supplemental
20-6 death benefit program becomes eligible to apply for the extended
20-7 coverage but fails to comply with Subsections (b) and (c) before
20-8 the member's death, the member will be considered to have had the
20-9 extended coverage if proof is furnished that the member could have
20-10 qualified for extended coverage if application for the coverage had
20-11 been made according to Subsections (b) and (c) and that the death
20-12 occurred within six months after the date the coverage of the
20-13 supplemental death benefit program was discontinued under Section
20-14 854.601.
20-15 SECTION 20. Section 855.301, Government Code, is amended to
20-16 read as follows:
20-17 Sec. 855.301. INVESTMENT OF ASSETS. (a) The board of
20-18 trustees shall invest and reinvest the assets of the retirement
20-19 system without distinction as to their source in:
20-20 (1) interest-bearing bonds or other evidences of
20-21 indebtedness of this state, a county, school district, city, or
20-22 other municipal corporation of this state, the United States, or an
20-23 authority or agency of the United States;
20-24 (2) securities on which the United States or any
20-25 authority or agency of the United States guarantees the payment of
20-26 principal and interest;
20-27 (3) corporate bonds or debentures that are issued by a
21-1 company:
21-2 (A) incorporated in the United States and that
21-3 are rated "A" or better by one or more nationally recognized rating
21-4 agencies approved by the board; or
21-5 (B) in whose stock the retirement system may
21-6 invest as provided by Subdivision (4);
21-7 (4) common or preferred stocks of a company
21-8 incorporated in the United States that has paid cash dividends on
21-9 its stock for 10 consecutive years immediately before the date of
21-10 purchase and, unless the stocks are bank or insurance stocks, that
21-11 is listed on an exchange registered with the Securities and
21-12 Exchange Commission or its successor;
21-13 (5) obligations issued, assumed, or guaranteed by the
21-14 Inter-American Development Bank, the International Bank for
21-15 Reconstruction and Development (the World Bank), the African
21-16 Development Bank, the Asian Development Bank, and the International
21-17 Finance Corporation; or
21-18 (6) bonds issued, assumed, or guaranteed by the State
21-19 of Israel.
21-20 (b) The assets of the retirement system may be held in the
21-21 name of agents, nominees, depository trust companies, or other
21-22 entities designated by the board of trustees. The records and all
21-23 relevant reports or accounts of the retirement system must show the
21-24 ownership interests of the retirement system in these assets and
21-25 the facts regarding the system's holdings.
21-26 SECTION 21. Section 855.501, Government Code, is amended by
21-27 adding Subsections (i) and (j) to read as follows:
22-1 (i) A participating municipality electing to provide an
22-2 increased service annuity reserve and electing a contribution rate
22-3 of 150 percent for a year may, by ordinance, agree to be liable for
22-4 total contributions at a rate that does not exceed a rate equal to
22-5 the maximum rate prescribed for the municipality by Section 855.407
22-6 plus two and one-half percent if the contribution rate for its
22-7 employees is six percent, or a rate that does not exceed a rate
22-8 equal to the maximum rate prescribed for the municipality by
22-9 Section 855.407 plus three percent if the contribution rate for its
22-10 employees is seven percent.
22-11 (j) A participating municipality electing to provide an
22-12 increased service annuity reserve and electing a contribution rate
22-13 of 200 percent for a year may, by ordinance, agree to be liable for
22-14 total contributions at a rate that does not exceed a rate equal to
22-15 the maximum rate prescribed for the municipality by Section 855.407
22-16 plus five percent if the contribution rate for its employees is six
22-17 percent, or a rate that does not exceed a rate equal to the maximum
22-18 rate prescribed for the municipality by Section 855.407 plus six
22-19 percent if the contribution rate for its employees is seven
22-20 percent.
22-21 SECTION 22. Section 854.102, Government Code, is amended by
22-22 adding Subsection (g) to read as follows:
22-23 (g) A member is eligible to retire and receive a service
22-24 retirement annuity if the member has at least 20 years of credited
22-25 service in the retirement system performed for one or more
22-26 municipalities that have adopted a like provision under Section
22-27 854.202(g).
23-1 SECTION 23. Section 854.202, Government Code, is amended by
23-2 adding Subsections (g), (h), and (i) to read as follows:
23-3 (g) The governing body may authorize a member to retire and
23-4 receive a service retirement benefit if the member has at least 20
23-5 years of credited service performed for one or more municipalities
23-6 that have authorized eligibility under this subsection.
23-7 (h) Before a governing body may elect to authorize a member
23-8 to retire pursuant to Subsection (g), the governing body shall:
23-9 (1) prepare an actuarial analysis of member retirement
23-10 annuities at 20 years of service; and
23-11 (2) hold a public hearing.
23-12 (i) The public hearing required under Subsection (h) shall
23-13 be held pursuant to the notice provisions of the Texas Open
23-14 Meetings Act, Chapter 551, Texas Government Code.
23-15 SECTION 24. This Act takes effect September 1, 1995.
23-16 SECTION 25. The importance of this legislation and the
23-17 crowded condition of the calendars in both houses create an
23-18 emergency and an imperative public necessity that the
23-19 constitutional rule requiring bills to be read on three several
23-20 days in each house be suspended, and this rule is hereby suspended.