By: Madla S.B. No. 1148
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the retirement system for police officers and
1-2 firefighters in certain municipalities.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Sections 4.01 and 4.02, Chapter 824, Acts of the
1-5 73rd Legislature, 1993 (Article 6243o, Vernon's Texas Civil
1-6 Statutes), are amended to read as follows:
1-7 Sec. 4.01. Membership. (a) A person becomes a member of
1-8 the fund as a condition of employment if the person:
1-9 (1) has served eight months <been properly appointed
1-10 and enrolled> as a fire fighter or police officer or as a trainee
1-11 in a fire fighter or police officer training academy of a
1-12 municipality to which this Act applies <in a position or office
1-13 established and classified by municipal ordinance>;
1-14 (2) <has served the probationary period for the
1-15 position;>
1-16 <(3) has served for six months as a fire fighter or
1-17 police officer of the municipality; and>
1-18 <(4)> was not younger than 18 <and had not attained
1-19 the age of 36> at the time of appointment; and
1-20 (3) has provided an authorization for release of
1-21 medical information for any medical records dated on or after the
1-22 date of initial application for employment or has agreed in writing
1-23 to provide that authorization when requested by the board, or in
1-24 the alternative if required by the board, has submitted to a
2-1 physical examination by a physician selected by the board.
2-2 (b) Notwithstanding Subsection (a) of this section, a person
2-3 duly appointed and enrolled in a classified position in either the
2-4 fire department or police department who was barred from entry in
2-5 the fund solely because the person had attained the age of 36 on
2-6 the date that the person would have otherwise become eligible after
2-7 October 15, 1990, to be a member of the fund and for that reason
2-8 became a member of the Texas Municipal Retirement System and who is
2-9 otherwise eligible for and complies with each requirement for
2-10 membership in the fund shall become a member of the fund as a
2-11 condition of continued employment. The person must make
2-12 application to the fund not later than the 90th day after the date
2-13 on which the person receives notification of this provision.
2-14 (c) A person who becomes a member of the fund under
2-15 Subsection (b) of this section shall be given service credit from
2-16 the date the person would have become eligible to be a member of
2-17 the fund if not for the age requirement and must pay into the fund,
2-18 in accordance with procedures established by the board, pension
2-19 contributions for all service credit allowed based on amounts that
2-20 would have been deducted if the person had been allowed to enter
2-21 the fund on that date.
2-22 (d) A person who became a member of the Texas Municipal
2-23 Retirement System on or before October 15, 1990, may elect to
2-24 become a member of the fund on or before the 90th day after the
2-25 date the person receives notice of this provision. If the person
2-26 does not elect to become a member during that period, the person
2-27 may not become a member of the fund and waives any claim against
3-1 the fund. If the person elects to become a member of the fund, the
3-2 person must comply with each requirement for membership and must
3-3 pay into the fund, in accordance with procedures established by the
3-4 board, a sum of money equal to the amount of money that would have
3-5 been deducted from that person's salary during the period beginning
3-6 October 16, 1990, and ending on the date the person becomes a
3-7 member of the fund. The person also may purchase service credit
3-8 for the period beginning on the date the person would have
3-9 otherwise become eligible to be a member of the fund if not for the
3-10 age prohibition, through October 15, 1990. Service credit may be
3-11 obtained only in increments of full months, with the minimum being
3-12 one month.
3-13 (e) A person who becomes a member of the fund under
3-14 Subsection (b) or (d) of this section must, as a condition of
3-15 employment, provide an authorization for release of medical
3-16 information for any medical records dated on or after the date of
3-17 initial application for employment when requested by the board or
3-18 in the alternative, as required by the board, must submit to a
3-19 physical examination by a physician selected by the board.
3-20 (f) A municipality to which this Act applies shall match an
3-21 amount equal to twice the amount of each payment a member makes to
3-22 the fund under this section.
3-23 (g) <(b)> The drawing of compensation by an officer or
3-24 employee in the fire or police department for service in that
3-25 department does not of itself make that person a member of the
3-26 fund.
3-27 (h) <(c)> The regularity of an appointment as a fire fighter
4-1 or police officer of a municipality to which this Act applies may
4-2 not be presumed from the serving of the full probationary period,
4-3 if any. The service of the probationary period by an officer or
4-4 employee as a fire fighter or police officer of a municipality to
4-5 which this Act applies does not constitute the creation of a
4-6 position or office to which a proper appointment has been made for
4-7 purposes of this Act.
4-8 Sec. 4.02. FAMILY AND MEDICAL LEAVE <REINSTATEMENT>.
4-9 (a) If a member takes unpaid leave as provided by the Family and
4-10 Medical Leave Act (29 U.S.C. Section 2601 et seq.), that member is
4-11 entitled to make voluntary contributions for the leave period in
4-12 the same amount as the member would have paid if the member had not
4-13 taken the leave. Those payments must be made not later than the
4-14 30th day after the date the member returns from that leave. A
4-15 computation of contributions under this section shall be made in
4-16 the same manner as other computations under this Act. A
4-17 municipality to which this Act applies shall match an amount equal
4-18 to twice the amount of each payment a member makes to the fund
4-19 under this subsection.
4-20 (b) If the member does not comply with Subsection (a) of
4-21 this section, the member loses all credit toward the member's
4-22 retirement annuity for the period the member was on leave <A
4-23 former fund member who has reentered the fire or police department
4-24 may not be barred from membership in the fund because of age as
4-25 long as the member can qualify for a 30-year pension on or before
4-26 the member's 65th birthday>.
4-27 SECTION 2. Subsection (c), Section 4.03, Chapter 824, Acts
5-1 of the 73rd Legislature, 1993 (Article 6243o, Vernon's Texas Civil
5-2 Statutes), is amended to read as follows:
5-3 (c) The member must make the payment described by Subsection
5-4 (b) of this section in full within an amount of time after the
5-5 member's return that is equal to three times <twice> the amount of
5-6 time the member was absent, except that the maximum period for
5-7 payment may not exceed five <four> years.
5-8 SECTION 3. Sections 4.04, 4.07, and 5.01, Chapter 824, Acts
5-9 of the 73rd Legislature, 1993 (Article 6243o, Vernon's Texas Civil
5-10 Statutes), are amended to read as follows:
5-11 Sec. 4.04. MEMBER CONTRIBUTIONS. (a) There shall be
5-12 deducted from the wages of each fire fighter and police officer in
5-13 the employment of a municipality to which this Act applies a
5-14 percentage of the member's total salary, excluding overtime pay,
5-15 according to the following schedule:
5-16 (1) 11.16 percent for full pay periods after September
5-17 30, 1993, but before October 1, 1994;
5-18 (2) 11.32 percent for full pay periods after September
5-19 30, 1994, but before October 1, 1995;
5-20 (3) 11.50 percent for full pay periods after September
5-21 30, 1995, but before October 1, 1996;
5-22 (4) 11.66 percent for full pay periods after September
5-23 30, 1996, but before October 1, 1997;
5-24 (5) 11.82 percent for full pay periods after September
5-25 30, 1997, but before October 1, 1998;
5-26 (6) 12 percent for full pay periods after September
5-27 30, 1998, but before October 1, 1999;
6-1 (7) 12.16 percent for full pay periods after September
6-2 30, 1999, but before October 1, 2000;
6-3 (8) 12.32 percent for full pay periods after September
6-4 30, 2000, but before October 1, 2001; and
6-5 (9) 12.50 percent for full pay periods after September
6-6 30, 2001.
6-7 (b) The municipality has always picked up and shall continue
6-8 to pick up the member contributions that are required by Subsection
6-9 (a) of this section.
6-10 (c) Contributions picked up by the municipality shall be
6-11 treated as employer contributions in accordance with Section
6-12 414(h)(2) of the Internal Revenue Code of 1986 (26 U.S.C. Section
6-13 414) for the purpose of determining tax treatment of the amounts
6-14 under the Internal Revenue Code of 1986. Those contributions are
6-15 not included in the gross income of the employee until the time
6-16 they are distributed or made available to the employee.
6-17 Sec. 4.07. <NO> REFUND OF CONTRIBUTIONS. (a) During the
6-18 first five years of membership, a <A> member of the fund is not
6-19 entitled to any refund from the fund of any portion of the money
6-20 deducted from the member's pay for the benefit of the fund. That
6-21 money is <public money and> the property of the fund for the
6-22 benefit of the members qualifying for benefits and for their
6-23 beneficiaries.
6-24 (b) A member of the fund who terminates employment before
6-25 the member's right to benefits under the fund has vested but who
6-26 has contributed to the fund for at least five years is entitled to
6-27 a refund of the member's contributions that were picked up by the
7-1 municipality. That refund shall be paid without interest. A
7-2 refund under this section is not available to a member who
7-3 terminates employment to receive a disability pension or to a
7-4 survivor beneficiary under this Act. A person's acceptance of a
7-5 refund under this subsection precludes the person from any other
7-6 right or benefit under this Act.
7-7 Sec. 5.01. Retirement benefits. (a) If a member of the
7-8 fund has contributed a portion of that member's salary as provided
7-9 by this Act and has contributed and served for 20 years or more in
7-10 the fire or police department, the board shall, on the application
7-11 of the member for a retirement annuity, authorize a retirement
7-12 annuity to the member.
7-13 (b) The board shall compute the retirement annuity of a
7-14 member who retires after September 30, 1991, but before October 1,
7-15 1995, on the basis of the average of the member's total salary,
7-16 excluding overtime pay, for the highest three years of the last
7-17 five years, computed from the date of retirement, of the member's
7-18 pay at the rate of two percent for each of the first 20 years
7-19 served, plus 3 1/2 percent for each of the next 10 years served,
7-20 plus one percent for each of the next five years served, with
7-21 fractional years prorated based on full months served as a
7-22 contributing member, but the annuity may not exceed, as of the date
7-23 of retirement, 80 percent of the average so determined.
7-24 (c) The board shall compute the retirement annuity of a
7-25 member who retires after September 30, 1995, on the basis of the
7-26 average of the member's total salary, excluding overtime pay, for
7-27 the highest three years of the last five years, computed from the
8-1 date of retirement, of the member's pay at the rate of two percent
8-2 for each of the first 20 years served, plus four percent for each
8-3 of the next five years served, plus 3 1/2 percent for each of the
8-4 next five years served, plus one percent for each of the next five
8-5 years served, with fractional years prorated based on full months
8-6 served as a contributing member. In making the computation for a
8-7 year, the year is considered to begin on the first day a
8-8 contribution is made. An annuity under this subsection may not
8-9 exceed, as of the date of retirement, 82.5 percent of the average
8-10 determined under this subsection.
8-11 (d) A member may not receive an award from the fund for
8-12 service retirement until the member has served at least 20 years in
8-13 the fire or police department and has also contributed the required
8-14 amount of money for at least 20 years. In determining the number
8-15 of years of service in a department, the member shall be given full
8-16 credit for the time the member was actively engaged in military
8-17 service in accordance with Section 4.03 of this Act and for
8-18 absences taken under the Family and Medical Leave Act (29 U.S.C.
8-19 Section 2601 et seq.), in accordance with Section 4.02 of this Act.
8-20 Disciplinary suspensions of 15 days or less may not be subtracted
8-21 from a member's service credit under this Act if the member has
8-22 paid into the fund within 30 days after the termination date of
8-23 each suspension a sum of money equal to the amount of money that
8-24 would have been deducted from that person's salary during that
8-25 period of suspension if it had not been for that suspension. A
8-26 municipality to which this Act applies shall double-match a payment
8-27 made under this subsection.
9-1 (e) <(d) If a member of the fire or police department has
9-2 served for 30 years or more in either department and has
9-3 contributed a portion of that member's salary as provided by this
9-4 Act for the same period, that member is retired automatically from
9-5 service on the member's 65th birthday.>
9-6 <(e) If, on a member's 65th birthday, the member has served
9-7 less than 30 years in either department and has not contributed a
9-8 portion of that member's salary as provided by this Act for that
9-9 period, the member may continue service and contributions until the
9-10 total service equals and the contributions have been made for 30
9-11 years.>
9-12 <(f)> Except as provided by Subsection (f) <(g)> of this
9-13 section, members of the fund at the time of their retirement shall
9-14 receive service credit for all unused sick leave accumulated by
9-15 them under Chapter 143, Local Government Code, and its subsequent
9-16 amendments, with fractional years prorated based on full months of
9-17 sick leave.
9-18 (f) <(g)> The retirement annuity for a member under
9-19 Subsection (e) <(f)> of this section may not exceed, as of the date
9-20 of retirement, 82.5 <80> percent of the average, determined under
9-21 that subsection and under the ordinances of a municipality to which
9-22 this Act applies, that exceeds 90 days of accumulated sick leave.
9-23 SECTION 4. Article 5, Chapter 824, Acts of the 73rd
9-24 Legislature, 1993 (Article 6243o, Vernon's Texas Civil Statutes),
9-25 is amended by adding Section 5.015 to read as follows:
9-26 Sec. 5.015. BACKWARD DEFERRED RETIREMENT OPTION PLAN (BACK
9-27 DROP). (a) At the time a member applies for retirement benefits
10-1 under Section 5.01 of this Act, the member may elect a Backward
10-2 Deferred Retirement Option Plan (Back DROP) with a lump-sum payment
10-3 and a reduced annuity benefit as provided by this section.
10-4 (b) The Back DROP election:
10-5 (1) results in a lump-sum payment for a number of full
10-6 months of service elected by the member that does not exceed the
10-7 lesser of the number of months of service credit the member has in
10-8 excess of 20 years or 24 months; and
10-9 (2) must be made at the time of application for
10-10 retirement.
10-11 (c) To be eligible to make a Back DROP election under this
10-12 section, a member of the fund must have contributed a portion of
10-13 that member's salary, as provided by this Act, and have contributed
10-14 and served at least 20 years and one month in the fire or police
10-15 department.
10-16 (d) The amount of a lump-sum payment to which a member
10-17 making a Back DROP election is entitled shall be computed in the
10-18 manner provided by this subsection. The member's average annual
10-19 salary shall be computed in the manner provided by Section 5.01(c)
10-20 of this Act, except that the retirement date used in making that
10-21 computation is the retirement date computed as provided by this
10-22 subsection. The member's average annual salary shall be divided by
10-23 12 to compute the member's average monthly salary. The member's
10-24 average monthly salary multiplied by the number of full months
10-25 elected by the member under Subsection (b)(1) of this section is
10-26 the amount of the lump-sum payment to which the member is entitled.
10-27 In computing the member's average annual salary under this
11-1 subsection, the member's retirement date is the member's Back DROP
11-2 retirement date, which is the member's actual retirement date less
11-3 the amount of time for:
11-4 (1) any service in excess of 35 years of service;
11-5 (2) any service credit given for sick leave unused on
11-6 the date of actual retirement; and
11-7 (3) service credit, for service in excess of 20 years
11-8 but not in excess of the amount permitted under Subsection (b)(1)
11-9 of this section, the member elects for computing the amount of the
11-10 lump-sum payment.
11-11 (e) For purposes of computing the monthly annuity of a
11-12 member making a Back DROP election, the member's average annual
11-13 salary shall be computed in the manner provided by Section 5.01(c)
11-14 of this Act, except that the retirement date used in making that
11-15 computation is the member's actual retirement date, plus time
11-16 representing any service credit given for sick leave unused on the
11-17 actual retirement date, less the amount of time the member elects
11-18 under Subsection (b)(1) of this section. The annuity may not
11-19 exceed the limitation provided by Section 5.01(c) of this Act. The
11-20 member's average annual salary shall be divided by 12 to compute
11-21 the member's monthly annuity.
11-22 (f) A member may defer receiving the lump-sum payment under
11-23 this section for a period of not longer than 12 months after the
11-24 member's retirement date. Interest may not be paid on the deferred
11-25 amount at the time of distribution.
11-26 (g) The board by administrative rule shall implement this
11-27 section in a manner that preserves the eligibility of the tax
12-1 qualification under the Internal Revenue Code of 1986 and may
12-2 revise the program as necessary to retain tax qualification.
12-3 SECTION 5. Subsection (a), Section 5.09, Chapter 824, Acts
12-4 of the 73rd Legislature, 1993 (Article 6243o, Vernon's Texas Civil
12-5 Statutes), is amended to read as follows:
12-6 (a) At or before its regular meeting in the month of March,
12-7 the board annually shall review the Consumer's Price Index for
12-8 Moderate Income Families in Large Cities--All Items or the nearest
12-9 equivalent published by the United States Bureau of Labor
12-10 Statistics for the preceding calendar year. If that index shows an
12-11 increase during the preceding calendar year in the cost of living
12-12 as compared with that index at the close of the previous year, the
12-13 board shall order an increase of all retirement annuities by the
12-14 number of full percentage points closest to the exact amount of the
12-15 increase of that index, except that any increased retirement
12-16 annuities are payable only at the rate of 75 percent of the
12-17 applicable cost-of-living percentage for those retirees, and the
12-18 beneficiaries of those retirees, who were retired on and after
12-19 August 30, 1971. The annual cost-of-living adjustment for a
12-20 retiree or a beneficiary of a retiree who retired on or after
12-21 September 1, 1971, but before October 1, 1989, shall be computed at
12-22 the rate of 87.5 percent of the consumer price index specified by
12-23 this subsection if the index is eight percent or less, with the
12-24 maximum cost-of-living adjustment capped at the rate of six
12-25 percent, but at the rate of 75 percent of the index if the index is
12-26 greater than eight percent for those retirees, with no cap on the
12-27 rate of the cost-of-living adjustment.
13-1 SECTION 6. Section 5.11, Chapter 824, Acts of the 73rd
13-2 Legislature, 1993 (Article 6243o, Vernon's Texas Civil Statutes),
13-3 is amended by amending Subsection (c) and by adding Subsection (j)
13-4 to read as follows:
13-5 (c) Accrued benefits under this Act become 100 percent
13-6 vested for all members on termination of the fund or on occurrence
13-7 of another event described in Section 401(a)(17) of the code and
13-8 become 100 percent vested for a member on the date the member
13-9 <becomes 65 years of age and> has completed 20 years of service.
13-10 (j) To the extent permitted by law, the board may adjust the
13-11 benefits of retired members and beneficiaries by increasing any
13-12 retirement benefit that was reduced as inflationary indexing under
13-13 Section 415 of the code. If the definition of compensation is
13-14 amended to include amounts previously excluded as compensation, the
13-15 board may adjust the benefits of retired members and beneficiaries,
13-16 including the payment of benefits previously excluded. Benefits
13-17 paid under this subsection are not considered as extra compensation
13-18 earned after retirement but as the delayed payment of benefits
13-19 earned before retirement.
13-20 SECTION 7. Subsections (c) and (d), Section 6.02, Chapter
13-21 824, Acts of the 73rd Legislature, 1993 (Article 6243o, Vernon's
13-22 Texas Civil Statutes), are amended to read as follows:
13-23 (c) If there are no children, the surviving spouse is
13-24 entitled to receive an amount not to exceed 60 <57.50> percent of
13-25 the average total salary, excluding overtime pay, of the deceased
13-26 member computed as provided under Subsection (a) of this section.
13-27 (d) If there is no surviving spouse, the children are
14-1 entitled to receive not more than 30 <28.75> percent of the average
14-2 total salary computed as provided under Subsection (a) of this
14-3 section, except that if the board determines on investigation that
14-4 the eligible children are destitute, the board may increase the
14-5 death benefit annuity to an amount not to exceed 40 percent of that
14-6 average total salary. The amount awarded under this subsection to
14-7 any child shall be paid by the board to the legal guardian of the
14-8 child.
14-9 SECTION 8. Section 6.04, Chapter 824, Acts of the 73rd
14-10 Legislature, 1993 (Article 6243o, Vernon's Texas Civil Statutes),
14-11 is amended to read as follows:
14-12 Sec. 6.04. Remarriage; benefits after termination of
14-13 marriage. (a) If a surviving spouse remarries or a dependent
14-14 child marries before October 1, 1995, the <The> right of a
14-15 surviving spouse or dependent child to annuity payments under this
14-16 Act terminates on the remarriage of the surviving spouse<, either
14-17 statutory or common law,> or on the marriage of the child, as
14-18 applicable, under either statutory law or under common law as
14-19 prescribed by Section 6.06 of this Act.
14-20 (b) The right of a <If the remarried> surviving spouse or
14-21 <married> dependent child to annuity payments under this Act is not
14-22 affected by the surviving spouse's remarriage or dependent child's
14-23 marriage under either statutory or common law if the marriage or
14-24 remarriage takes place on or after October 1, 1995 <becomes
14-25 unmarried, that person is entitled, on application, to the greater
14-26 of 75 percent of the annuity that was in effect on the date of
14-27 termination or a minimum annuity of $800 each month for as long as
15-1 that person remains unmarried>.
15-2 (c) If after October 1, 1995, there is a termination of the
15-3 remarriage of a surviving spouse or of the marriage of a dependent
15-4 child, that person is entitled, on application, to 100 percent of
15-5 the annuity that was in effect on the date of termination of
15-6 benefits.
15-7 (d) A surviving spouse or dependent child who is unmarried
15-8 but receiving reduced benefits because of a prior marriage that
15-9 caused the benefits to be terminated is entitled to 100 percent of
15-10 the annuity that was in effect on the original date of termination
15-11 of benefits.
15-12 (e) The benefit provided under Subsections (c) and (d) of
15-13 this section shall be applied prospectively beginning October 1,
15-14 1995, and the surviving spouse or dependent child is not entitled
15-15 to receive any benefits or increases in benefits relating to any
15-16 period before October 1, 1995.
15-17 SECTION 9. Subsection (b), Section 6.05, Chapter 824, Acts
15-18 of the 73rd Legislature, 1993 (Article 6243o, Vernon's Texas Civil
15-19 Statutes), is amended to read as follows:
15-20 (b) If the <surviving spouse,> dependent beneficiary<,> or
15-21 guardian fails or refuses to file an affidavit required under
15-22 Subsection (a) of this section or if an incomplete, incorrect, or
15-23 false affidavit is filed, the board may suspend annuity payments to
15-24 that person indefinitely until the person complies with the
15-25 requests and orders of the board.
15-26 SECTION 10. Section 6.07, Chapter 824, Acts of the 73rd
15-27 Legislature, 1993 (Article 6243o, Vernon's Texas Civil Statutes),
16-1 is amended to read as follows:
16-2 Sec. 6.07. Surviving spouse's right to single entitlement.
16-3 A <Unless otherwise provided by law, a> surviving spouse who is not
16-4 a member of the fund is not entitled to more than one annuity from
16-5 the fund.
16-6 SECTION 11. Subsection (a), Section 6.11, Chapter 824, Acts
16-7 of the 73rd Legislature, 1993 (Article 6243o, Vernon's Texas Civil
16-8 Statutes), is amended to read as follows:
16-9 (a) If a member of the fire or police department in active
16-10 service dies and does not leave an eligible surviving spouse, a
16-11 child under 17 years of age, a child under 19 years of age who is
16-12 attending school, a mentally or physically disabled child, or a
16-13 dependent father or mother, the estate of the deceased member is
16-14 entitled to a death benefit payment in the amount of $10,000 from
16-15 the fund or the refund of contributions as provided by Section 4.07
16-16 of this Act, whichever amount is greater.
16-17 SECTION 12. Subsections (a) and (b), Section 7.04, Chapter
16-18 824, Acts of the 73rd Legislature, 1993 (Article 6243o, Vernon's
16-19 Texas Civil Statutes), are amended to read as follows:
16-20 (a) The board shall cause the reserve retirement funds to be
16-21 invested in a manner that a prudent investor would invest,
16-22 considering the purposes, terms, distribution requirements, and
16-23 other circumstances <consistent with the care, skill, and diligence
16-24 under the prevailing circumstances that a prudent person acting in
16-25 a like capacity and familiar with matters of the type would use in
16-26 the conduct> of an enterprise with a like character and like aims.
16-27 (b) The board shall diversify the investment of the fund to
17-1 minimize the risk of large losses unless under the circumstances it
17-2 is clearly prudent not to do so. In determining whether the board
17-3 has exercised prudence concerning an investment decision, the
17-4 investment of all assets of the fund, rather than the prudence of a
17-5 single investment of <investing the assets of the fund, the board
17-6 shall be bound by the documents and instruments governing> the
17-7 fund, shall be considered.
17-8 SECTION 13. Chapter 824, Acts of the 73rd Legislature, 1993
17-9 (Article 6243o, Vernon's Texas Civil Statutes), is amended by
17-10 adding Article 7A to read as follows:
17-11 ARTICLE 7A. STANDARDS OF CONDUCT AND FINANCIAL
17-12 DISCLOSURE REQUIREMENTS
17-13 Sec. 7.51. POLICY. (a) A member of the board or the
17-14 executive director may not have a direct or indirect interest,
17-15 including a financial interest, engage in a business transaction or
17-16 professional activity, or incur an obligation of any nature that is
17-17 in substantial conflict with the proper discharge of the member's
17-18 or the executive director's fiduciary duties.
17-19 (b) To implement Subsection (a) of this section and to
17-20 strengthen the faith and confidence of the members and
17-21 beneficiaries of the fund, the board shall develop standards of
17-22 conduct and financial disclosure requirements to be observed by
17-23 each member of the board and by the executive director in the
17-24 performance of official duties.
17-25 (c) The standards of conduct and financial disclosure
17-26 requirements must provide for:
17-27 (1) general definitions;
18-1 (2) the manner of determining substantial conflict;
18-2 (3) the manner of determining who is considered a
18-3 dependent child of a board member or the executive director;
18-4 (4) each member of the board and the executive
18-5 director to file a financial disclosure statement;
18-6 (5) a review board to be appointed;
18-7 (6) the composition of the review board;
18-8 (7) a custodian of records to be designated;
18-9 (8) the manner in which records must be retained;
18-10 (9) the information, generally, that must be included
18-11 in a financial statement;
18-12 (10) the time for filing a financial statement;
18-13 (11) the form in which a financial statement must be
18-14 presented;
18-15 (12) compliance with this section;
18-16 (13) public access to financial statements;
18-17 (14) sanctions for a violation of this section that
18-18 must include removal of a member of the board or the executive
18-19 director in the case of a serious violation;
18-20 (15) standards of conduct for board members and the
18-21 executive director; and
18-22 (16) other matters relating to conduct of board
18-23 members and the executive director and financial disclosure the
18-24 board considers appropriate.
18-25 SECTION 14. This Act takes effect October 1, 1995.
18-26 SECTION 15. The importance of this legislation and the
18-27 crowded condition of the calendars in both houses create an
19-1 emergency and an imperative public necessity that the
19-2 constitutional rule requiring bills to be read on three several
19-3 days in each house be suspended, and this rule is hereby suspended.