By Madden                                       H.B. No. 1269

      75R1678 GCH-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to credit in the Teacher Retirement System of Texas for

 1-3     out-of-state service.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Section 823.401, Government Code, is amended by

 1-6     adding Subsection (j) to read as follows:

 1-7           (j)  For purposes of this section, a public school system

 1-8     maintained wholly or partly by the United States includes a school

 1-9     outside the boundaries of the United States that is not operated by

1-10     the United States government but has a substantial enrollment of

1-11     children of American citizens and receives regular payments because

1-12     of that enrollment from an agency of the United States government.

1-13           SECTION 2.  (a)  The executive director of the Teacher

1-14     Retirement System of Texas shall, as soon as practicable after the

1-15     effective date of this Act, request a determination from an

1-16     appropriate official of the federal Internal Revenue Service as to

1-17     whether administration of Section 823.401(j), Government Code, as

1-18     added by this Act, is a ground for loss of the retirement system's

1-19     status as a qualified trust under Section 401(a), Internal Revenue

1-20     Code of 1986 (26 U.S.C. Section 401(a)).

1-21           (b)  If the executive director receives a determination under

1-22     Subsection (a)  that the administration of Section 823.401(j),

1-23     Government Code, as added by this Act, is a ground for a change in

1-24     the retirement system's tax status, the retirement system shall

 2-1     file the determination with the secretary of state for publication

 2-2     in the Texas Register.  After receipt of that determination, the

 2-3     retirement system:

 2-4                 (1)  may not grant additional service credit to persons

 2-5     who qualify for the credit under Section 823.401(j), Government

 2-6     Code, as added by this Act;

 2-7                 (2)  shall cancel any service credit granted to persons

 2-8     who qualified for the credit under that subsection and refund the

 2-9     payments made to establish the credit; and

2-10                 (3)  shall recompute any annuities that were computed

2-11     using credit established by persons who qualified for the credit

2-12     under that subsection to exclude the credit and recover any

2-13     payments made because of the credit.

2-14           SECTION 3.  The importance of this legislation and the

2-15     crowded condition of the calendars in both houses create an

2-16     emergency and an imperative public necessity that the

2-17     constitutional rule requiring bills to be read on three several

2-18     days in each house be suspended, and this rule is hereby suspended,

2-19     and that this Act take effect and be in force from and after its

2-20     passage, and it is so enacted.