LEGISLATIVE BUDGET BOARD
                          Austin, Texas

                           FISCAL NOTE
                       74th Regular Session

                          March 19, 1995



 TO:     Honorable Barry Telford, Chair         IN RE:  Senate BillNo. 520,
         Committee on Pensions & Investments                   as engrossed
         House of Representatives                       By: Montford
         Austin, Texas








FROM: John Keel, Director

In response to your request for a Fiscal Note on Senate Bill No.
520 (relating to eligibility for retirement and benefits under
the Texas Municipal Retirement System) this office has determined
the following:

Under current law, a member of the Texas Municipal Retirement
System (TMRS) may retire and receive retirement benefits if the
member has at least 25 years of credited service.  The bill would
amend this provision to allow municipalities to choose an earlier
retirement eligibility requirement of 20 years of  service.

Municipalities that choose this option would pay a higher
contribution to TMRS.  While the cost will vary by municipality,
it is expected that the employer contribution as a percent of
payroll would increase in the range of  0.3 percent to 0.4
percent. 

For example, a city with a $3.1 million annual payroll would
experience a contribution rate increase from 12.76 percent to
13.15 percent,  which would result in an increase in annual
dollar contributions of approximately $12,000.  Because the
number of municipalities that would adopt this provision is
unknown, the fiscal implication to municipalities cannot be
determined.


No fiscal implication to the State is anticipated.
        




 







Source:   LBB Staff: JK, RR