SRC-MAX S.B. 631 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 631
By: Haywood
State Affairs
3-14-97
As Filed


DIGEST 

Currently, certain state retirees are allowed to resume service with the
state at a level of compensation equal to their previous level of pay.
This practice usually occurs after a senior employee has retired under a
retirement incentive program.  There are concerns that the practice of
allowing the retirees to return to work at a level of pay equal to their
previous salary is not realizing as much cost savings as originally
intended.  This bill will reduce the level of salary for a reemployed
state retiree. 

PURPOSE

As proposed, S.B. 631 prohibits certain state retirees from being paid a
salary at a certain annualized rate. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 659B, Government Code, by adding Section
659.0115, as follows: 

Sec.  659.0115.  SALARIES OF RETIRED STATE EMPLOYEES WHO RESUME STATE
EMPLOYMENT.  Prohibits a retiree of the employee class of membership of
the Employees Retirement System of Texas (ERS), who is reemployed by the
state, from being paid a salary at a certain annualized rate.  Provides
that a retiree of the Teacher Retirement System of Texas (TRS), the
majority of whose service was credited in that system in a position as an
officer or employee of a state agency, who is reemployed by the state, is
subject to the salary restriction described by Subsection (a).  Defines
"state" and "state agency."  

SECTION 2. Amends Chapter 2252, Government Code, by adding Subchapter Z,
as follows: 

SUBCHAPTER Z.  MISCELLANEOUS PROVISIONS

Sec.  2252.901.  CONTRACTS WITH RETIRED STATE EMPLOYEES.  Prohibits a
state agency that contracts with a retiree of the employee class of
membership of ERS or TRS, the majority of whose service was credited in
that system in a position as an officer or employee of a state agency,
from paying for personal services under the contract that are
substantially similar to the services the retiree performed as a state
officer or employee at an annualized rate exceeding the lesser of 50
percent of the rate of compensation over the last year before retirement;
or 50 percent of the highest rate of compensation for any consecutive
12-month period; or that, when added to the retiree's annual retirement
benefit, exceeds the salary the retiree received during the last 12 months
of service before retirement.   Defines "state" and "state agency." 

SECTION 3. (a)  Makes application of Section 659.0115, Government Code, as
added by this Act, prospective. 

(b)  Makes application of Section 2252.901, Government Codem as added by
this Act,  prospective. 

SECTION 4. (a)  Effective date:  September 1, 1997, except as provided by
Subsection (b).         

(b)  Provides that if this Act receives the vote required by Section 39,
Article III, of the Texas Constitution for accelerated effect, this Act
takes effect of the first day of the month after the first month in which
it could take effect. 

SECTION 5. Emergency clause.