1-1 By: Armbrister S.B. No. 1231
1-2 (In the Senate - Filed March 10, 1995; March 16, 1995, read
1-3 first time and referred to Committee on State Affairs;
1-4 April 25, 1995, reported adversely, with favorable Committee
1-5 Substitute by the following vote: Yeas 13, Nays 0; April 25, 1995,
1-6 sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 1231 By: Armbrister
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to the powers and duties of and systems and programs under
1-11 the Employees Retirement System of Texas.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Section 805.002, Government Code, is amended by
1-14 amending Subsections (a), (b), and (d) and by adding Subsections
1-15 (g) and (h) to read as follows:
1-16 (a) Except as provided by Subsection (h), a <A> member of
1-17 both the employees retirement system and the teacher retirement
1-18 system who applies for service or disability retirement from either
1-19 system may transfer to that system service credit established in
1-20 the other system if the member has at least three years of service
1-21 credit in the system from which the member is retiring. If a
1-22 person whose membership was transferred from the teacher retirement
1-23 system to the employees retirement system pursuant to Section
1-24 43(a), Chapter 812, Acts of the 73rd Legislature, 1993, ceases to
1-25 hold any position included in the membership of the employees
1-26 retirement system before the earlier of the date the person retires
1-27 or dies, the person's service credit accrued in the teacher
1-28 retirement system before the date the membership was transferred
1-29 remains credited in that system, unless the person has withdrawn
1-30 contributions made for the service.
1-31 (b) Except as provided by Subsection (h), a <A> member of
1-32 both the employees retirement system and the teacher retirement
1-33 system who has less than three years of service credit in the
1-34 system in which the person most recently received service credit
1-35 and at least three years of service credit in the other system may,
1-36 at the time the person applies for service or disability retirement
1-37 <from the other system>, transfer service credit to the other
1-38 <that> system from the system in which the person most recently
1-39 received service credit.
1-40 (d) Except as provided by Subsections (e) and (f), the
1-41 designated beneficiary of a member of the employees retirement
1-42 system or the teacher retirement system who dies while holding a
1-43 position included in the membership of the system may make a
1-44 transfer under Subsection (a) and a reinstatement or purchase under
1-45 Subsection (c) if the deceased member had at least three years of
1-46 service credit in the system in which the member was performing
1-47 service at the time of death. The designated beneficiary may make
1-48 a transfer under Subsection (b) if the deceased member had less
1-49 than three years of service credit in the system in which the
1-50 member was performing service at the time of death. If a member is
1-51 not survived by a designated beneficiary, an alternate beneficiary,
1-52 or a beneficiary provided by law or has failed to designate a
1-53 beneficiary after becoming a member or resuming membership, the
1-54 personal representative of the member's estate has the same right
1-55 under this subsection as a designated beneficiary. A transfer of
1-56 service by the beneficiary or personal representative of a deceased
1-57 member's estate is not permitted unless the transfer will result in
1-58 the payment of a death benefit annuity.
1-59 (g) To be eligible to make a transfer pursuant to Subsection
1-60 (d), a person must be the same beneficiary under both retirement
1-61 systems.
1-62 (h) A member applying for occupational disability retirement
1-63 from the employees retirement system may transfer service credit
1-64 from the teacher retirement system only if the member was
1-65 contributing to the employees retirement system at the time the
1-66 disabling condition occurred.
1-67 SECTION 2. Section 805.003, Government Code, is amended to
1-68 read as follows:
2-1 Sec. 805.003. Payments to Reinstate or Purchase Service
2-2 Credit. The cost of reinstating or purchasing service credit under
2-3 Section 805.002 is determined according to the statutes that govern
2-4 the reinstatement or purchase of the type of service credit in the
2-5 system in which it is to be reinstated or purchased. All payments
2-6 for service credit reinstated or purchased under Section 805.002
2-7 must be made before retirement or the first payment of a death
2-8 benefit annuity, as applicable, or before a later date if allowed
2-9 for members of the retirement system in which the credit is to be
2-10 reinstated or purchased.
2-11 SECTION 3. Subsections (a) and (b), Section 805.007,
2-12 Government Code, are amended to read as follows:
2-13 (a) A person who transfers service credit under this chapter
2-14 forfeits all rights to benefits payable by the system from which it
2-15 is transferred and is not an annuitant of that system for any
2-16 purpose, including the payment of postretirement increases to
2-17 annuitants of that system. This subsection does not preclude a
2-18 person from receiving benefits as a beneficiary of an account not
2-19 related to the transferred service credit.
2-20 (b) Service credit transferred under this chapter is
2-21 considered as if it had been granted for service performed under
2-22 the system to which it has been transferred and is used in
2-23 satisfying minimum service requirements for retirement and in
2-24 determining the amount of benefits that are based on the amount of
2-25 a person's service credit:
2-26 (1) except that a person's average salary for the
2-27 purpose of computing an annuity may be determined only from service
2-28 credit that was originally established in one system and that
2-29 results in the higher average salary; <and>
2-30 (2) except as provided by Section 805.006; and
2-31 (3) except service credit transferred by a member
2-32 applying for occupational disability retirement.
2-33 SECTION 4. Section 805.008, Government Code, is amended to
2-34 read as follows:
2-35 Sec. 805.008. RESPONSIBILITY FOR BENEFIT PAYMENTS.
2-36 (a) Except as provided by Subsection (c), the <The> system from
2-37 which a person's service credit is transferred under this chapter
2-38 shall transfer to the other system, at the time the annuity based
2-39 on the service credit becomes payable, an amount equal to the
2-40 portion of the actuarial value of the annuity that represents the
2-41 percentage of the total amount of the person's service credited in
2-42 both systems that was credited in the system from which the credit
2-43 is being transferred.
2-44 (b) Except as provided by Subsection (c), the <The> systems
2-45 jointly by rule shall adopt actuarial tables and investment
2-46 assumptions to be used in computing actuarial values under this
2-47 section.
2-48 (c) As an alternative to Subsections (a) and (b), the
2-49 systems by rule may require the system from which service credit is
2-50 transferred to pay monthly an amount equal to the portion of the
2-51 actual value of the monthly payment of the annuity that represents
2-52 the percentage of the total amount of service credit that is
2-53 transferred.
2-54 (d) For the purpose of computing an amount to be transferred
2-55 under this section, service credit in either system must be
2-56 considered as if it were credited under rules of the teacher
2-57 retirement system determining the amount of service creditable.
2-58 (e) <(d)> An amount transferred under this section is
2-59 payable from amounts credited to the person's individual account
2-60 and amounts credited to the account in which the system places
2-61 state contributions. Except as provided by Subsection (g), an <An>
2-62 amount received under this section shall be deposited in the
2-63 account from which the system receiving the amount pays annuities.
2-64 (f) <(e)> The system to which a transfer is made under this
2-65 section is responsible for paying the annuity for which the
2-66 transfer was made, including the entire amount of any increase in
2-67 the annuity granted after the transfer.
2-68 (g) At the time of the death of a person whose membership
2-69 was transferred from the teacher retirement system to the employees
2-70 retirement system pursuant to Section 43(a), Chapter 812, Acts of
3-1 the 73rd Legislature, 1993, the teacher retirement system shall
3-2 transfer to the employees retirement system the person's service
3-3 credit in the teacher retirement system and, if employment with the
3-4 transferring agency was continuous from the date of transfer to the
3-5 date of death:
3-6 (1) an amount determined under Subsections (a) and (b)
3-7 or under Subsection (c), if an annuity is paid under Chapter 814;
3-8 or
3-9 (2) the amount of money in the member savings account
3-10 plus an amount equal to five percent of the person's account
3-11 balance for each full year of service credited in the teacher
3-12 retirement system, if a death benefit other than an annuity is paid
3-13 under Chapter 814.
3-14 SECTION 5. Subsection (c), Section 805.002, Government Code,
3-15 is amended to read as follows:
3-16 (c) Except as provided by Subsections (e) and (f), a member
3-17 of the employees retirement system or the teacher retirement system
3-18 who formerly was a member of the other system may reinstate or
3-19 purchase service credit in the other system for the purpose of
3-20 making a transfer under Subsection (a) if the member has at least
3-21 three years of service credit in the system in which the person
3-22 currently is a member. Except as provided by Subsections (e) and
3-23 (f), a member of the employees retirement system or the teacher
3-24 retirement system who formerly was a member of the other system,
3-25 who before September 1, 1993, transferred at least three years of
3-26 service credit to the system in which the person currently is a
3-27 member, and who has at least three years of service credit other
3-28 than the transferred credit in the system in which the person
3-29 currently is a member may reinstate or purchase service credit in
3-30 the other system for the purpose of making a transfer of all
3-31 service credit to that other system.
3-32 SECTION 6. Subdivision (8), Section 811.001, Government
3-33 Code, is amended to read as follows:
3-34 (8) "Custodial officer" means a member of the
3-35 retirement system who is employed by the institutional division or
3-36 the state jail division of the Texas Department of Criminal Justice
3-37 and is certified by the department and accepted by the retirement
3-38 system as eligible to receive service credit as a custodial officer
3-39 <as having a normal job assignment that requires frequent or
3-40 infrequent regularly planned contact with, and in close proximity
3-41 to, inmates of the institutional division or inmates or defendants
3-42 confined in the state jail division without the protection of bars,
3-43 doors, security screens, or similar devices and includes
3-44 assignments normally involving supervision or the potential for
3-45 supervision of inmates in inmate housing areas, educational or
3-46 recreational facilities, industrial shops, kitchens, laundries,
3-47 medical areas, agricultural shops or fields, or in other areas on
3-48 or away from property of the institutional division or the state
3-49 jail division>.
3-50 SECTION 7. Section 813.104, Government Code, is amended by
3-51 amending Subsection (d), by relettering Subsection (e) as
3-52 Subsection (g), and by adding new Subsections (e) and (f) to read
3-53 as follows:
3-54 (d) Except as provided by Subsection (e), payments
3-55 <Payments> may not be made under this section:
3-56 (1) to establish or reestablish service credit of a
3-57 person who has retired or died; or
3-58 (2) to establish current service under Section
3-59 813.201.
3-60 (e) The designated beneficiary of a deceased member or, if
3-61 none exists, the personal representative of the decedent's estate
3-62 may establish or reestablish service for which the member was
3-63 eligible at the time of death if the establishment of the service
3-64 would result in the payment of a death benefit annuity or an
3-65 increase in the amount of a death benefit annuity.
3-66 (f) The payment for the establishment or reestablishment of
3-67 service under Subsection (e) must be made in a lump sum and
3-68 completed before the first payment of a death benefit annuity, but
3-69 not later than the 60th day after the date the retirement system
3-70 receives notice of the death.
4-1 (g) <(e)> The retirement system may adopt rules to
4-2 administer this section.
4-3 SECTION 8. Subchapter D, Chapter 813, Government Code, is
4-4 amended by adding Section 813.305 to read as follows:
4-5 Sec. 813.305. MILITARY SERVICE CREDIT GOVERNED BY UNIFORMED
4-6 SERVICES EMPLOYMENT AND REEMPLOYMENT RIGHTS ACT. The retirement
4-7 system may adopt rules to comply with the Uniformed Services
4-8 Employment and Reemployment Rights Act (38 U.S.C. Section 4301 et
4-9 seq.) and other federal laws affecting the crediting of military
4-10 service.
4-11 SECTION 9. Section 813.506, Government Code, is amended to
4-12 read as follows:
4-13 Sec. 813.506. Custodial Officer Service. (a) The Texas
4-14 Department of Criminal Justice <Corrections> by rule shall adopt
4-15 standards for determining eligibility for service credit as a
4-16 custodial officer, based on the need to encourage early retirement
4-17 of persons whose duties are hazardous and require them to have
4-18 routine contact with inmates of or defendants confined in the state
4-19 jail division of the Texas Department of Criminal Justice
4-20 <Corrections> on a regular basis.
4-21 (b) To be creditable as custodial officer service, service
4-22 performed must meet the requirements of the rules adopted under
4-23 Subsection (a) and must <may> be performed by persons <in one of
4-24 the following job categories:>
4-25 <(1) all persons> classified as Correctional Officer I
4-26 through warden, including training officers and special operations
4-27 reaction team officers<;>
4-28 <(2) all other employees assigned to work on a unit
4-29 and whose jobs require routine contact with inmates, including but
4-30 not limited to farm managers, livestock supervisors, maintenance
4-31 foremen, shop foremen, medical assistants, food service
4-32 supervisors, stewards, education consultants, commodity
4-33 specialists, and correctional counselors;>
4-34 <(3) employees assigned to administrative offices
4-35 whose jobs require routine contact with inmates, including but not
4-36 limited to investigators, compliance monitors, accountants
4-37 routinely required to audit unit operations, sociologists,
4-38 interviewers, classification officers, and supervising counselors;
4-39 and>
4-40 <(4) administrative positions whose jobs require
4-41 response to emergency situations involving inmates, including but
4-42 except as specified not limited to the director, deputy directors,
4-43 assistant directors, and not more than 25 administrative duty
4-44 officers>. An employee of the department on September 1, 1995, who
4-45 before that date was certified as eligible to receive service
4-46 credit as a custodial officer continues to accrue service credit as
4-47 a custodial officer for service performed on or after that date for
4-48 the department in a position for which employees were eligible for
4-49 certification under this section before September 1, 1995.
4-50 (c) The institutional division of the Texas Department of
4-51 Criminal Justice shall determine a person's eligibility to receive
4-52 credit as a custodial officer. A determination of the division may
4-53 not be appealed by an employee but is subject to change by the
4-54 retirement system.
4-55 (d) <(e)> As part of the audit of the institutional division
4-56 of the Texas Department of Criminal Justice by the state auditor in
4-57 accordance with Chapter 321, the state auditor <State Auditor> may
4-58 verify the accuracy of reports submitted to the retirement system
4-59 under this section. The state auditor shall review biennially the
4-60 standards adopted by the department under Subsection (a).
4-61 SECTION 10. Section 813.509, Government Code, is amended to
4-62 read as follows:
4-63 Sec. 813.509. Credit for Accumulated Sick Leave. (a) A
4-64 member who holds a position included in the employee class of
4-65 membership during the month that includes the effective date of the
4-66 member's retirement and who retires based on service or a
4-67 disability is entitled to service credit in the retirement system
4-68 for the member's sick leave that has accumulated and is unused on
4-69 the last day of employment. Sick leave is creditable in the
4-70 retirement system at the rate of one month of service credit for
5-1 each 20 days, or 160 hours, of accumulated sick leave. An
5-2 increment of less than 20 days is not creditable.
5-3 (b) A member who holds a position included in the employee
5-4 class may use sick leave creditable under this section to satisfy
5-5 service requirements for retirement under Section 814.104 or
5-6 814.107 if the sick leave attributed to the eligibility
5-7 requirements remains otherwise unused on the last day of
5-8 employment.
5-9 (c) Except as provided by Subsection (d), the <The>
5-10 disbursing officer of each department or agency shall, before the
5-11 11th day after the effective date of retirement of one or more
5-12 employees of the department or agency <of each month>, certify to
5-13 the retirement system:
5-14 (1) the name of each person whose retirement from the
5-15 department or agency, and from state service, became effective
5-16 during the preceding month; and
5-17 (2) the amount of the person's accumulated sick leave
5-18 on the last day of employment.
5-19 (d) The disbursing officer of a department or agency that
5-20 employs a member who applies for retirement under Subsection (b)
5-21 shall, not more than 90 or less than 30 days before the effective
5-22 date of the member's retirement, certify to the retirement system
5-23 the amount of the member's accumulated and unused sick leave. The
5-24 officer shall immediately notify the retirement system if the
5-25 member uses sick leave after the date of certification.
5-26 (e) <(c)> On receipt of a certification under Subsection (c)
5-27 or (d) <(b)>, the retirement system shall grant any credit to which
5-28 a retiring member or retiree who is a subject of the certification
5-29 is entitled. An increase in the computation of an annuity because
5-30 of credit provided by this section after a certification under
5-31 Subsection (c) begins with the first payment that becomes due after
5-32 certification.
5-33 (f) The retirement system shall cancel the retirement of a
5-34 person who used sick leave creditable under this section to qualify
5-35 for service retirement if the sick leave is otherwise used by the
5-36 person before the effective date of retirement.
5-37 (g) In this section, "sick leave" does not include credit
5-38 granted under an agency sick-leave pool or under the Family and
5-39 Medical Leave Act of 1993 (26 U.S.C. Section 2601 et seq.).
5-40 SECTION 11. Subchapter F, Chapter 813, Government Code, is
5-41 amended by adding Section 813.510 to read as follows:
5-42 Sec. 813.510. CREDIT FOR CERTAIN AGRICULTURAL SERVICE.
5-43 (a) An eligible member may, before January 1, 1996, elect to
5-44 establish service credit in the retirement system for service
5-45 performed for the Department of Agriculture as an employee of the
5-46 Federal State Inspection Service of Texas.
5-47 (b) A member eligible to establish credit under this section
5-48 is one who became an employee of or resumed employment with the
5-49 Department of Agriculture in May, 1992, on the creation of the
5-50 Texas Cooperative Inspection Program.
5-51 (c) A member may establish credit under this section by
5-52 depositing with the retirement system:
5-53 (1) a contribution based on the member's monthly
5-54 compensation during the period of service for the Department of
5-55 Agriculture as an employee of the Federal State Inspection Service
5-56 of Texas and computed for the number of months for which credit is
5-57 sought at the combined contribution rates required during the
5-58 period for the state and employee members of the system for new
5-59 service;
5-60 (2) interest computed on the basis of the state fiscal
5-61 year at an annual rate of 10 percent from the date the service was
5-62 performed to the date of deposit; and
5-63 (3) any membership fees required of members of the
5-64 system during the period of the service.
5-65 (d) An election under this section must be filed with the
5-66 retirement system on a form provided by the system. Credit may be
5-67 established under this section by a lump-sum payment or by payments
5-68 authorized by Section 813.104 or 813.105.
5-69 (e) The retirement system shall deposit the compensation
5-70 contribution in the member's individual account in the employees
6-1 saving account, interest in the state accumulation account, and
6-2 membership fees in the expense account.
6-3 (f) The retirement system shall determine the amount to be
6-4 deposited in each case and may not grant service credit to a member
6-5 under this section until the member provides proof of eligibility
6-6 for the credit that is satisfactory to the retirement system.
6-7 SECTION 12. Section 814.003, Government Code, is amended by
6-8 adding Subsection (e) to read as follows:
6-9 (e) If a person elects to receive a standard disability
6-10 retirement annuity and dies during the first calendar month that
6-11 begins after the effective date of the person's retirement, the
6-12 person is considered to have been a contributing member at the time
6-13 of death.
6-14 SECTION 13. Section 814.004, Government Code, is amended to
6-15 read as follows:
6-16 Sec. 814.004. When Benefits are Payable. A monthly annuity
6-17 payable to a retiree or beneficiary is payable to that person
6-18 through the month in which the person dies. A continuation of an
6-19 optional annuity or the payment of a death or survivor benefit
6-20 annuity begins with payment for the month following the month in
6-21 which the death occurs. <An annuity provided by this chapter
6-22 accrues for the period beginning on the first day of the month that
6-23 begins after the month in which a person dies or retires, as
6-24 applicable, and ending, except as otherwise provided by this
6-25 chapter, on the day the person who receives the annuity dies.>
6-26 SECTION 14. Subchapter A, Chapter 814, Government Code, is
6-27 amended by adding Sections 814.006 and 814.007 to read as follows:
6-28 Sec. 814.006. SIMULTANEOUS DEATH OF MEMBER AND BENEFICIARY.
6-29 When a member or annuitant and the beneficiary of the member or
6-30 annuitant have died within a period of less than 120 hours, the
6-31 member or annuitant is considered to have survived the beneficiary
6-32 for the purpose of determining the rights to amounts payable under
6-33 this subtitle on the death of the member or annuitant.
6-34 Sec. 814.007. BENEFICIARY CAUSING DEATH OF MEMBER OR
6-35 ANNUITANT. (a) A benefit payable on the death of a member or
6-36 annuitant may not be paid to a person convicted of causing that
6-37 death but instead is payable as if the convicted person had
6-38 predeceased the decedent.
6-39 (b) A person who becomes eligible under this section to
6-40 select death or survivor benefits may select benefits as if the
6-41 person were the designated beneficiary.
6-42 (c) The retirement system shall reduce any annuity computed
6-43 in part on the age of the convicted person to a lump sum equal to
6-44 the present value of the remainder of the annuity. The reduced
6-45 amount is payable to a person entitled as provided by this section
6-46 to receive the benefit.
6-47 (d) The retirement system is not required to change the
6-48 recipient of benefits under this section unless it receives actual
6-49 notice of the conviction of a beneficiary. However, the retirement
6-50 system may delay payment of a benefit payable on the death of a
6-51 member or annuitant pending the results of a criminal investigation
6-52 and of legal proceedings relating to the cause of death.
6-53 (e) For the purposes of this section, a person has been
6-54 convicted of causing the death of a member or annuitant if the
6-55 person:
6-56 (1) pleads guilty or nolo contendere to, or is found
6-57 guilty by a court of, causing the death of the member or annuitant,
6-58 regardless of whether sentence is imposed or probated; and
6-59 (2) has no appeal of the conviction pending and the
6-60 time provided for appeal has expired.
6-61 SECTION 15. Subsections (b) and (f), Section 814.107,
6-62 Government Code, are amended to read as follows:
6-63 (b) The standard service retirement annuity payable for at
6-64 least 20 years of service credit as a law enforcement or custodial
6-65 officer is an amount computed on the basis of the member's average
6-66 monthly compensation for that service for the 36 highest months of
6-67 compensation, times the sum of the percentage factor used in the
6-68 computation of a standard service retirement annuity under Section
6-69 814.105 plus .5 percent. <a percentage derived from the following
6-70 table:>
7-1 <Years of Law Enforcement or Percentage of Average>
7-2 <Custodial Officer Service Credit Monthly Compensation>
7-3 <at least 20 but less than 21 50 percent>
7-4 <at least 21 but less than 22 52 percent>
7-5 <at least 22 but less than 23 54 percent>
7-6 <at least 23 but less than 24 56 percent>
7-7 <at least 24 but less than 25 58 percent>
7-8 <at least 25 but less than 26 60 percent>
7-9 <at least 26 but less than 27 62 percent>
7-10 <at least 27 but less than 28 64 percent>
7-11 <at least 28 but less than 29 66 percent>
7-12 <at least 29 but less than 30 68 percent>
7-13 <at least 30 but less than 31 70 percent>
7-14 <at least 31 but less than 32 71 percent>
7-15 <at least 32 but less than 33 72 percent>
7-16 <at least 33 but less than 34 73 percent>
7-17 <at least 34 but less than 35 74 percent>
7-18 <at least 35 but less than 36 75 percent>
7-19 <at least 36 but less than 37 76 percent>
7-20 <at least 37 but less than 38 77 percent>
7-21 <at least 38 but less than 39 78 percent>
7-22 <at least 39 but less than 40 79 percent>
7-23 <40 or more 80 percent>
7-24 (f) The standard combined service retirement annuity payable
7-25 for at least 20 years of service credit as a law enforcement or
7-26 custodial officer may not exceed 100 <80> percent of the higher of
7-27 the average compensation computed under Section 814.105 or the
7-28 average compensation computed under Subsection (b).
7-29 SECTION 16. Section 814.108, Government Code, is amended by
7-30 adding Subsection (g) to read as follows:
7-31 (g) Except as provided by Section 814.1081, a person who
7-32 selected an optional service retirement annuity approved by the
7-33 board of trustees or an optional service retirement annuity
7-34 described by Subsection (c)(1) or (c)(2) may not change or revoke a
7-35 beneficiary designation after the person's effective date of
7-36 retirement.
7-37 SECTION 17. Subsections (b), (d), and (e), Section 814.207,
7-38 Government Code, are amended to read as follows:
7-39 (b) Except as provided by Subsection (c), an occupational
7-40 disability retirement annuity under this section is an amount, but
7-41 not more than 100 <80> percent, computed on the basis of the
7-42 officer's monthly compensation at the time of the disabling injury
7-43 or disease, times a percentage derived by application of <the table
7-44 provided by> Section 814.107(b).
7-45 (d) The portions <portion> of the annuity under this section
7-46 payable from the law enforcement and custodial officer supplemental
7-47 retirement fund are <is> the amount remaining after deduction of
7-48 any amount payable under Section 814.206, except the portion of an
7-49 amount that exceeds the minimum payments provided by Section
7-50 814.206(b) and that is made for service other than as a law
7-51 enforcement or custodial officer and any amount by which an annuity
7-52 is increased under Subsection (e).
7-53 (e) If a retiring member or retiree under this section
7-54 presents evidence satisfactory to the retirement system that the
7-55 person's condition makes the person incapable of gainful occupation
7-56 and is considered a total disability under federal social security
7-57 law, the retirement system shall increase the person's occupational
7-58 disability retirement annuity to 100 percent of the officer's
7-59 monthly compensation at the time of the disabling injury or disease
7-60 <Section 815.405 is held to be invalid by a court of competent
7-61 jurisdiction and the decision becomes final, an annuity may not be
7-62 paid under this section>.
7-63 SECTION 18. Section 814.301, Government Code, is amended by
7-64 adding Subsection (e) to read as follows:
7-65 (e) A beneficiary designation that names a former spouse as
7-66 beneficiary is invalid for purposes of this section unless the
7-67 designation is made after the date of the divorce.
7-68 SECTION 19. Subsection (a), Section 814.302, Government
7-69 Code, is amended to read as follows:
7-70 (a) If a member eligible to select a death benefit plan
8-1 under Section 814.301 dies without having made a selection, or if a
8-2 selection cannot be made effective, the member's designated
8-3 beneficiary <surviving spouse> may select a plan in the same manner
8-4 as if the member had made the selection. If there is no designated
8-5 beneficiary <surviving spouse>, the personal representative of the
8-6 decedent's estate may make the selection for the benefit of the
8-7 decedent's heirs or devisees. In lieu of selecting a death benefit
8-8 plan, the designated beneficiary <surviving spouse> or, if there is
8-9 none, the personal representative of the decedent's estate, may
8-10 elect to receive a refund of contributions and any applicable
8-11 payment under Section 814.401.
8-12 SECTION 20. Subsections (b) and (d), Section 814.401,
8-13 Government Code, are amended to read as follows:
8-14 (b) The benefit provided by this section is payable to the
8-15 beneficiary designated by the member under Section 814.403(b) <a
8-16 person designated by the member in a signed document filed with the
8-17 retirement system>. If a member does not designate a beneficiary
8-18 or if the beneficiary designation cannot be made effective <does
8-19 not survive the member>, the benefit is payable to the member's
8-20 estate.
8-21 (d) A death benefit may not be paid under this section if,
8-22 at the time of death, a death benefit annuity <under Section
8-23 814.301> became effective.
8-24 SECTION 21. Section 814.403, Government Code, is amended to
8-25 read as follows:
8-26 Sec. 814.403. Return of Contributions. (a) Except as
8-27 provided by Subsection (d) <(c)>, if a member dies before
8-28 retirement, the amount in the member's individual account in the
8-29 employees saving account at the time of death is payable as a
8-30 lump-sum death benefit.
8-31 (b) Except as provided by Subsection (c), the <The> benefit
8-32 provided by this section is payable to a person designated by the
8-33 member in a signed and witnessed document filed with the retirement
8-34 system before the member's death. A designation, change, or
8-35 revocation of a beneficiary in a will or other document not filed
8-36 with the retirement system is not effective. If a member does not
8-37 designate a beneficiary or if the beneficiary designation cannot be
8-38 made effective <does not survive the member>, the benefit is
8-39 payable to the member's estate.
8-40 (c) A beneficiary designation that names a former spouse as
8-41 beneficiary is invalid for purposes of this section unless the
8-42 designation is made after the date of the divorce.
8-43 (d) A death benefit may not be paid under this section if,
8-44 at the time of death, a death benefit annuity <under Section
8-45 814.301> became effective.
8-46 SECTION 22. Section 814.501, Government Code, is amended by
8-47 amending Subsection (b) and by adding Subsection (c) to read as
8-48 follows:
8-49 (b) The benefit provided by this section is payable to the
8-50 beneficiary designated by the member under Section 814.403(b) <a
8-51 person designated by the retiree in a signed and witnessed document
8-52 filed with the retirement system>. If a retiree does not designate
8-53 a beneficiary or if the beneficiary designation cannot be made
8-54 effective <does not survive the retiree>, the benefit is payable to
8-55 the retiree's estate.
8-56 (c) A beneficiary designation that names a former spouse as
8-57 beneficiary is invalid for purposes of this section unless the
8-58 designation is made after the date of the divorce.
8-59 SECTION 23. Subsections (a) and (d), Section 814.603,
8-60 Government Code, are amended to read as follows:
8-61 (a) The retirement system shall make a supplemental payment
8-62 as provided by Subsection (d) to persons whose annuities are
8-63 described by Section 814.107, 814.207, 814.305, or 814.601(a) and
8-64 that are based on service retirements, disability retirements, or
8-65 deaths. This supplemental payment is in addition to the regular
8-66 monthly annuity payment. Each person who receives an annuity
8-67 described by this subsection is entitled to receive one payment
8-68 equal to 10 percent of one month's annuity payment for each fiscal
8-69 year that preceded or includes the effective date of the
8-70 requirement or authorization under Subsection (d) and <before the
9-1 fiscal year beginning September 1, 1993,> in which the annuity has
9-2 been paid. A supplemental payment may not exceed 350 percent of a
9-3 monthly annuity. <Only a person whose annuity began in the fiscal
9-4 year ending August 31, 1993, or earlier is eligible for the
9-5 supplemental payment.> Supplemental payments under this subsection
9-6 must comply with Section 811.006.
9-7 (d) The retirement system shall make a supplemental payment
9-8 under this section in the fiscal year ending August 31, 1997. The
9-9 board of trustees may by rule authorize similar supplemental
9-10 payments in succeeding <the> fiscal years <year ending August 31,
9-11 1995>, if the payments are in compliance with Section 811.006.
9-12 SECTION 24. Section 815.006, Government Code, is amended to
9-13 read as follows:
9-14 Sec. 815.006. Compensation; Expenses. (a) Notwithstanding
9-15 Subchapter C of Chapter 659, trustees <Trustees> who are
9-16 contributing members of the retirement system serve without
9-17 compensation but are entitled to reimbursement for all actual and
9-18 necessary expenses that they incur in the performance of official
9-19 board duties.
9-20 (b) Notwithstanding Subchapter C of Chapter 659, subject
9-21 <Subject> to the approval of the board of trustees, trustees who
9-22 are not contributing members of the retirement system may receive:
9-23 (1) compensation; and
9-24 (2) reimbursement for all actual and necessary
9-25 expenses that they incur in the performance of official board
9-26 duties.
9-27 SECTION 25. The heading of Section 815.110, Government Code,
9-28 is amended to read as follows:
9-29 Sec. 815.110. AUDITS <MANAGEMENT AUDIT>.
9-30 SECTION 26. Section 815.110, Government Code, is amended by
9-31 adding Subsection (e) to read as follows:
9-32 (e) The board of trustees annually shall select an
9-33 independent auditor to perform a financial audit of the retirement
9-34 system. The selection shall be made under a competitive bidding
9-35 process in which the state auditor is eligible to bid.
9-36 SECTION 27. Subsection (b), Section 815.301, Government
9-37 Code, is amended to read as follows:
9-38 (b) The board of trustees may delegate its authority under
9-39 Subsection (a) to the executive director. The board of trustees or
9-40 the executive director may, under the standard of care provided by
9-41 Section 815.307, invest and reinvest any of the retirement system's
9-42 assets and may commingle assets of the trust fund and the law
9-43 enforcement and custodial officer supplemental retirement fund with
9-44 the assets of the Judicial Retirement System of Texas Plan Two for
9-45 investment purposes, as long as proportionate ownership records are
9-46 maintained and credited. Investments may include home office
9-47 facilities, including land, equipment, and office building, used in
9-48 administering the retirement system.
9-49 SECTION 28. Subchapter F, Chapter 815, Government Code, is
9-50 amended by adding Section 815.511 to read as follows:
9-51 Sec. 815.511. APPEAL OF ADMINISTRATIVE DECISION. A person
9-52 aggrieved by a decision of any retirement system administered by
9-53 the board of trustees denying or limiting membership, service
9-54 credit, or eligibility for or the amount of benefits payable by a
9-55 system may appeal the decision to the board. The appeal is a
9-56 contested case under the administrative procedure law, Chapter
9-57 2001. On judicial appeal the standard of review is by substantial
9-58 evidence.
9-59 SECTION 29. (a) Except as provided by Subsections (b) and
9-60 (c) of this section, annuities that are described by Section
9-61 814.107, 814.207, or 814.305, or Subsection (a), Section 814.601,
9-62 Government Code, and are based on service retirements, disability
9-63 retirements, or deaths that occurred before September 1, 1995, are
9-64 increased by 12.5 percent.
9-65 (b) Annuities are increased under Subsection (a) of this
9-66 section only if the actuary for the Employees Retirement System of
9-67 Texas certifies, based on an August 31, 1995, actuarial valuation,
9-68 that all annuity increases and annuity recomputations required or
9-69 authorized by this Act, together with all other actuarial
9-70 liabilities resulting from legislation that is enacted by the 74th
10-1 Legislature in 1995 before August 31 and that has or will become
10-2 law, will not cause the time required to amortize the unfunded
10-3 actuarial liabilities of the retirement system to be increased to a
10-4 period that exceeds 31 years. For purposes of this subsection, a
10-5 bill will become law if it has not taken effect but either has been
10-6 signed by the governor or the time provided for gubernatorial
10-7 action under Section 14, Article IV, Texas Constitution, has
10-8 expired without the governor having vetoed the bill. The increase
10-9 in annuities under Subsection (a) of this section is payable
10-10 beginning with the first monthly payments of the annuities that
10-11 become due after the month in which the actuarial certification
10-12 required by this subsection is made to the board of trustees of the
10-13 retirement system.
10-14 (c) Retirements that occurred under the provisions of
10-15 Section 814.1051 or 814.1071, Government Code, are not increased by
10-16 this section.
10-17 (d) The board of trustees of the retirement system shall pay
10-18 the increased annuities provided by this section from the
10-19 retirement annuity reserve account of the retirement system and may
10-20 transfer to that account from the state accumulation account of the
10-21 retirement system any portion of the amount that exceeds the amount
10-22 in the retirement reserve account available to finance the
10-23 increases in benefits, and that is actuarially determined to be
10-24 necessary to finance the increases, for the duration of the
10-25 annuities to which the increases apply.
10-26 SECTION 30. A member of the Employees Retirement System of
10-27 Texas who is described by Subsection (e), Section 812.203,
10-28 Government Code, and who is eligible to select a death benefit plan
10-29 under Section 814.301, Government Code, may select a plan and
10-30 designate a beneficiary, who also will be the beneficiary of any
10-31 optional annuity on the member's retirement, without regard to any
10-32 rule adopted under Section 804.051, Government Code. This section
10-33 expires January 1, 1996.
10-34 SECTION 31. (a) A member of the Employees Retirement System
10-35 of Texas who is an appointed officer of the 74th House of
10-36 Representatives of the State of Texas, as determined by the house
10-37 journal, who has at least 28 years of service credit in the
10-38 retirement system, and who has attained the age of 50 is eligible
10-39 to make an election under this section.
10-40 (b) A member of the Employees Retirement System of Texas who
10-41 has at least 18 years of service creditable in the retirement
10-42 system, who has served as the executive head of a legislative
10-43 service agency, and who has attained the age of 50 is eligible to
10-44 make an election under this section.
10-45 (c) A member of the elected class of the Employees
10-46 Retirement System of Texas who did not hold an elective office on
10-47 May 1, 1995, who has at least seven years of service credit in that
10-48 class, and who has at least seven years of other service creditable
10-49 in the retirement system that is not credited in the employee class
10-50 may make an election under this section.
10-51 (d) An election under this section must be made in writing
10-52 and filed with the Employees Retirement System of Texas before
10-53 January 1, 1996, and is irrevocable after filing. A person who
10-54 makes an election under Subsection (a) of this section must retire
10-55 on the first effective retirement date that occurs after the date
10-56 of filing. After the filing of an election under this section, the
10-57 retirement system shall consider all the service credit established
10-58 by the person who makes the election, including service credit
10-59 established after the date the election is filed, as if it were
10-60 performed as a member of the elected class of membership.
10-61 SECTION 32. Subchapter A, Chapter 830, Government Code, is
10-62 amended by adding Section 830.0011 to read as follows:
10-63 Sec. 830.0011. DEFINITION. Notwithstanding Section 821.001,
10-64 in this chapter "retirement system" means the Teacher Retirement
10-65 System of Texas or the Employees Retirement System of Texas, as the
10-66 context requires.
10-67 SECTION 33. Section 830.106, Government Code, is amended to
10-68 read as follows:
10-69 Sec. 830.106. Eligibility for Resumption of Membership. A
10-70 participant in the optional retirement program is not eligible for
11-1 membership in the retirement system unless the person:
11-2 (1) terminates employment covered by the optional
11-3 retirement program; and
11-4 (2) becomes employed in the public school system or
11-5 with a state agency in a position that is not eligible for
11-6 participation in the optional retirement program.
11-7 SECTION 34. Subchapter B, Chapter 833, Government Code, is
11-8 amended by adding Section 833.1031 to read as follows:
11-9 Sec. 833.1031. MILITARY SERVICE CREDIT GOVERNED BY UNIFORMED
11-10 SERVICES EMPLOYMENT AND REEMPLOYMENT RIGHTS ACT. The retirement
11-11 system may adopt rules to comply with the Uniformed Services
11-12 Employment and Reemployment Rights Act (38 U.S.C. Section 4301 et
11-13 seq.) and other federal laws affecting the crediting of military
11-14 service.
11-15 SECTION 35. Subchapter B, Chapter 838, Government Code, is
11-16 amended by adding Section 838.1031 to read as follows:
11-17 Sec. 838.1031. MILITARY SERVICE CREDIT GOVERNED BY UNIFORMED
11-18 SERVICES EMPLOYMENT AND REEMPLOYMENT RIGHTS ACT. The retirement
11-19 system may adopt rules to comply with the Uniformed Services
11-20 Employment and Reemployment Rights Act (38 U.S.C. Section 4301 et
11-21 seq.) and other federal laws affecting the crediting of military
11-22 service.
11-23 SECTION 36. Subdivisions (2) and (5), Subsection (a),
11-24 Section 3, Texas Employees Uniform Group Insurance Benefits Act
11-25 (Article 3.50-2, Vernon's Texas Insurance Code), are amended to
11-26 read as follows:
11-27 (2) "Annuitant" shall mean an officer or employee who
11-28 retires under:
11-29 (A) the jurisdiction of the Employees Retirement
11-30 System of Texas and either receives an annuity or is eligible to
11-31 receive an annuity, pursuant to Subtitle B, D, or E of Title 8,
11-32 Government Code, or Chapter 803, Government Code, that is based on
11-33 at least 10 years of service credit or eligibility under Section
11-34 814.002 or 814.102, Government Code;
11-35 (B) the jurisdiction of the Teacher Retirement
11-36 System of Texas and either receives an annuity or is eligible to
11-37 receive an annuity, pursuant to Subtitle C, Title 8, Government
11-38 Code, or Chapter 803, Government Code, that is based on at least 10
11-39 years of service credit, whose last state employment prior to
11-40 retirement, including employment by a public community/junior
11-41 college, was as an employee of a department whose employees are
11-42 authorized to participate in the Texas employees uniform group
11-43 insurance program <the Teacher Retirement System of Texas, school
11-44 districts established within state eleemosynary institutions, the
11-45 Texas Rehabilitation Commission, the Central Education Agency, the
11-46 Texas Higher Education Coordinating Board, or an institution of
11-47 higher education>;
11-48 (C) the optional retirement program established
11-49 by Chapter 830, Government Code, and either receives an annuity or
11-50 is eligible to receive an annuity under that program, if the
11-51 person's last state employment before retirement, including
11-52 employment by a public community/junior college, was as an <officer
11-53 or> employee of a department whose employees are authorized to
11-54 participate in the Texas employees uniform group insurance program
11-55 and if the person either:
11-56 (i) would have been eligible to retire and
11-57 receive a service retirement annuity from the Teacher Retirement
11-58 System of Texas or the Employees Retirement System of Texas based
11-59 on at least 10 years of service credit had the person not elected
11-60 to participate in the optional retirement program; or
11-61 (ii) is disabled as determined by the
11-62 Employees Retirement System of Texas <the Texas Higher Education
11-63 Coordinating Board or an institution of higher education>; or
11-64 (D) any other federal or state statutory
11-65 retirement program to which an institution of higher education has
11-66 made employer contributions, if the employee has met service
11-67 requirements, age requirements, and other applicable requirements
11-68 comparable to the requirements for retirement under the Teacher
11-69 Retirement System of Texas, based on at least 10 years of service
11-70 credit<, and if the person either:>
12-1 <(i) would have been eligible to retire
12-2 and receive a service retirement annuity from the Teacher
12-3 Retirement System of Texas based on at least 10 years of service
12-4 credit had the person not elected to participate in the optional
12-5 retirement program; or>
12-6 <(ii) is disabled>.
12-7 (5)(A) "Employee" shall mean any appointive or
12-8 elective <state> officer or employee in the service of the State of
12-9 Texas, including an employee of an institution of higher education:
12-10 (i) who is retired or retires and is an
12-11 annuitant under the jurisdiction of the Employees Retirement System
12-12 of Texas, pursuant to Subtitle B, D, or E;
12-13 (ii) <, or Chapter 803, Title 8,
12-14 Government Code,> who is retired or retires and is an annuitant
12-15 under the jurisdiction of the Teacher Retirement System of Texas,
12-16 pursuant to Subtitle C, Title 8, Government Code, or pursuant to
12-17 Chapter 803, Government Code, and whose last employment with the
12-18 state prior to retirement, including employment by a public
12-19 community/junior college, was as an employee of a department whose
12-20 employees are authorized to participate in the Texas employees
12-21 uniform group insurance program <the Teacher Retirement System of
12-22 Texas, school districts established within state eleemosynary
12-23 institutions, the Texas Rehabilitation Commission, the Central
12-24 Education Agency, the Texas Higher Education Coordinating Board, or
12-25 an institution of higher education, or who is retired or retires
12-26 and is an annuitant under the optional retirement program
12-27 established by Chapter 830, Government Code, if the person's last
12-28 state employment before retirement, including employment by a
12-29 public community/junior college, was as an officer or employee of
12-30 the Texas Higher Education Coordinating Board, or an institution of
12-31 higher education, and if the person either:>
12-32 <(a) would have been eligible to
12-33 retire and receive a service retirement annuity from the Teacher
12-34 Retirement System of Texas had the person not elected to
12-35 participate in the optional retirement program; or>
12-36 <(b) is disabled>;
12-37 (iii) who is retired or retires and is an
12-38 annuitant under the optional retirement program established by
12-39 Chapter 830, Government Code, if the person's last state employment
12-40 before retirement, including employment by a public
12-41 community/junior college, was as an employee of a department whose
12-42 employees are authorized to participate in the Texas employees
12-43 uniform group insurance program, and if the person either:
12-44 (a) would have been eligible to
12-45 retire and receive a service retirement annuity from the Teacher
12-46 Retirement System of Texas or the Employees Retirement System of
12-47 Texas had the person not elected to participate in the optional
12-48 retirement program; or
12-49 (b) is disabled as determined by the
12-50 Employees Retirement System of Texas;
12-51 (iv) <(ii)> who receives <his>
12-52 compensation for services rendered to the State of Texas, other
12-53 than an employee of an institution of higher education described by
12-54 this subdivision, on a warrant issued pursuant to a payroll
12-55 certified by a department or by an elected or duly appointed
12-56 officer of this state;
12-57 (v) <(iii)> who receives payment for the
12-58 performance of personal services on a warrant issued pursuant to a
12-59 payroll certified by a department and drawn by the State
12-60 Comptroller of Public Accounts upon the State Treasurer against
12-61 appropriations made by the Texas Legislature from any state funds
12-62 or against any trust funds held by the State Treasurer or who is
12-63 paid from funds of an official budget of a state department, rather
12-64 than from funds of the General Appropriations Act;
12-65 (vi) <(iv)> who is appointed, subject to
12-66 confirmation of the senate, as a member of a board or commission
12-67 with administrative responsibility over a statutory agency having
12-68 statewide jurisdiction whose employees are covered by this Act;
12-69 (vii) <(v)> who is a member of the
12-70 governing body of an institution of higher education, as that term
13-1 is defined by this Act <Section 61.003, Education Code, including
13-2 subsequent amendments to that section>;
13-3 (viii) <(vi)> who is a member of the State
13-4 Board of Education;
13-5 (ix) <(vii)> who receives compensation for
13-6 services rendered to an institution of higher education on a
13-7 warrant or check issued pursuant to a payroll certified by an
13-8 institution of higher education or by an elected or duly appointed
13-9 officer of this state, and who is eligible for participation in the
13-10 Teacher Retirement System of Texas; or
13-11 (x) <(viii)> who receives compensation for
13-12 services rendered to an institution of higher education as provided
13-13 by this subdivision but is not permitted to be a member of the
13-14 Teacher Retirement System of Texas because the person is solely
13-15 employed by an institution of higher education that as a condition
13-16 of employment requires the person to be enrolled as a student in an
13-17 institution of higher education in graduate-level courses and who
13-18 is employed by the institution at least 20 hours a week.
13-19 (B) Persons performing personal services for the
13-20 State of Texas as independent contractors shall never be considered
13-21 employees of the state for purposes of this Act.
13-22 SECTION 37. Section 4B, Texas Employees Uniform Group
13-23 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
13-24 Code), is amended by adding Subsection (a-1) and by amending
13-25 Subsection (c) to read as follows:
13-26 (a-1) If the executive director determines that a
13-27 participant has obtained coverage under any program provided under
13-28 the authority of this Act through the use of any material
13-29 misrepresentation or fraud or has fraudulently induced the
13-30 extension of coverage by making a material misrepresentation or by
13-31 supplying false information on any application for coverage or
13-32 related documentation or in any communication, the executive
13-33 director may rescind the coverage to the date of the inception of
13-34 the coverage or to the date of the fraudulent act or material
13-35 misrepresentation, deny any claim arising out of the fraudulently
13-36 induced coverage, or both. Remedies available to the executive
13-37 director under this subsection are in addition to and independent
13-38 of any expulsion action that may be instituted under Section 13A of
13-39 this Act. A decision of the executive director under this
13-40 subsection may be appealed to the trustee as provided by Subsection
13-41 (c) of this section.
13-42 (c) A decision by the executive director under Subsection
13-43 (a) or (a-1) of this section may be appealed only to the trustee.
13-44 An appeal to the trustee is a contested case under the
13-45 administrative procedure law, Chapter 2001, Government Code.
13-46 Standing to pursue an administrative appeal under this section is
13-47 limited to employees, annuitants, and covered dependents
13-48 participating in the Texas employees uniform group insurance
13-49 program or, after the death of a participant, to the participant's
13-50 estate, personal representative, heirs at law, or designated
13-51 beneficiary <Administrative Procedure and Texas Register Act
13-52 (Article 6252-13a, Vernon's Texas Civil Statutes)>.
13-53 SECTION 38. Subsection (f), Section 5, Texas Employees
13-54 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
13-55 Texas Insurance Code), is amended to read as follows:
13-56 (f) The trustee, in its sole discretion and in accordance
13-57 with the requirements of this section, shall determine those plans
13-58 of coverages for which the trustee does not intend to purchase
13-59 insurance and which it intends to provide directly from the
13-60 Employees Life, Accident, and Health Insurance and Benefits Fund.
13-61 Any plan of coverages for which the trustee does not purchase
13-62 insurance but provides under this Act on a self-funded basis is
13-63 exempt from any other insurance law unless the law expressly
13-64 applies to this plan or this Act. The trustee shall make an
13-65 estimate of the unrestricted balance of the fund. Unless such
13-66 estimated unrestricted balance is equal to at least 10 percent of
13-67 the total benefits expected to be provided directly from the fund
13-68 as a result of claims incurred during the fiscal year, the trustee
13-69 shall include in the contributions required the amount necessary to
13-70 establish an unrestricted balance in the fund of not less than 10
14-1 percent. The unrestricted balance shall be placed in a contingency
14-2 reserve fund to provide for adverse fluctuations in future charges,
14-3 claims, costs, or expenses of the program.
14-4 SECTION 39. Section 13A, Texas Employees Uniform Group
14-5 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
14-6 Code), is amended to read as follows:
14-7 Sec. 13A. Expulsion From Group Insurance Program.
14-8 (a) After notice and hearing as provided by this section, the
14-9 trustee may expel from participation in the Texas employees uniform
14-10 group insurance program any employee, annuitant, or dependent who
14-11 submits a fraudulent claim or application for coverage under or has
14-12 defrauded or attempted to defraud any health maintenance
14-13 organization or insurance or benefits plan offered under the
14-14 program.
14-15 (b) On receipt of a complaint or on its own motion, the
14-16 trustee may call and hold a hearing to determine whether <or not>
14-17 an employee, annuitant, or dependent has submitted a fraudulent
14-18 claim or application for coverage under or has defrauded or
14-19 attempted to defraud any health maintenance organization or
14-20 insurance or benefits plan offered under the Texas employees
14-21 uniform group insurance program.
14-22 (c) A proceeding under this section is a contested case
14-23 under the administrative procedure law, Chapter 2001, Government
14-24 Code <Administrative Procedure and Texas Register Act (Article
14-25 6252-13a, Vernon's Texas Civil Statutes)>.
14-26 (d) At the conclusion of the hearing, if the trustee issues
14-27 a decision that finds that the accused employee, annuitant, or
14-28 dependent submitted a fraudulent claim or application for coverage
14-29 or has defrauded or attempted to defraud any health maintenance
14-30 organization or insurance or benefits plan offered under the Texas
14-31 employees uniform group insurance program, the trustee shall expel
14-32 the employee, annuitant, or dependent from participation in the
14-33 program.
14-34 (e) An appeal of a decision of the trustee under this
14-35 section is under the substantial evidence rule.
14-36 (f) An employee, annuitant, or dependent expelled from the
14-37 Texas employees uniform group insurance program may not participate
14-38 in a health maintenance organization or be insured under <by> any
14-39 <health> insurance or benefits plan offered by the program for a
14-40 period determined by the trustee of not more than five years from
14-41 the date the expulsion from the program takes effect.
14-42 SECTION 40. Subsection (a), Section 14, Texas Employees
14-43 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
14-44 Texas Insurance Code), is amended to read as follows:
14-45 (a) The trustee shall use the amount appropriated for
14-46 employer contributions in accordance with Section 15 of this Act
14-47 <and Subsection (a-1) of this section> to fund the basic coverage.
14-48 The trustee may equitably allocate to each health benefits plan the
14-49 employer contributions that would be required to fund basic health
14-50 coverage for participants in the plans to the extent funds are
14-51 available. In allocating the employer contributions among plans,
14-52 the trustee shall consider the relevant risk characteristics of
14-53 each plan's enrollment, including demographic variations in the use
14-54 and cost of health care and the prevailing cost patterns in the
14-55 area in which the plan operates. The allocation must be reasonable
14-56 and set in a manner which assures employees a fair choice among
14-57 health benefit plans providing a basic plan. The contribution set
14-58 for each employee shall be within the total amount appropriated in
14-59 the General Appropriations Act.
14-60 SECTION 41. Section 609.507, Government Code, is amended to
14-61 read as follows:
14-62 Sec. 609.507. Financial Institution as Qualified Vendor.
14-63 <(a)> Each bank or savings and loan association that is a
14-64 qualified vendor is not required to comply with Chapter 404 with
14-65 regard to deferrals and investment income, but shall comply with
14-66 plan rules that deal with vendors and investment products <shall:>
14-67 <(1) treat deferred amounts and investment income as
14-68 state funds; and>
14-69 <(2) comply with Chapter 404.>
14-70 <(b) The state treasurer shall monitor each bank or savings
15-1 and loan association that is a qualified vendor for compliance with
15-2 Chapter 404. The state treasurer shall immediately notify the
15-3 board of trustees of a violation of that chapter that the treasurer
15-4 observes.>
15-5 <(c) The board of trustees is entitled to rely on the
15-6 supervision of the state treasurer>.
15-7 SECTION 42. The following provisions are repealed:
15-8 (1) Subsection (h), Section 814.107, Government Code;
15-9 (2) Section 815.108, Government Code;
15-10 (3) Subsection (g), Section 815.403, Government Code;
15-11 and
15-12 (4) Subsection (a-1), Section 14, Texas Employees
15-13 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
15-14 Texas Insurance Code).
15-15 SECTION 43. (a) The Employees Retirement System of Texas
15-16 shall recompute each annuity that is based on the service of a
15-17 person who has retired under Section 814.1071, Government Code, to
15-18 include an amount, proportional to the amount authorized for each
15-19 year of credit under Section 814.107, Government Code, for each
15-20 whole month of credit as a law enforcement or custodial officer
15-21 that was not used in the original computation of the annuity.
15-22 (b) The increases in annuities provided by this Act are
15-23 payable, from the law enforcement and custodial officer
15-24 supplemental retirement fund, beginning with the first payments of
15-25 the annuities that become due on or after September 1, 1995.
15-26 SECTION 44. This Act takes effect September 1, 1995.
15-27 SECTION 45. The importance of this legislation and the
15-28 crowded condition of the calendars in both houses create an
15-29 emergency and an imperative public necessity that the
15-30 constitutional rule requiring bills to be read on three several
15-31 days in each house be suspended, and this rule is hereby suspended.
15-32 * * * * *