1-1 By: Kuempel (Senate Sponsor - Armbrister) H.B. No. 1638
1-2 (In the Senate - Received from the House April 10, 1997;
1-3 April 11, 1997, read first time and referred to Committee on
1-4 Intergovernmental Relations; May 5, 1997, reported favorably, as
1-5 amended, by the following vote: Yeas 11, Nays 0; May 5, 1997, sent
1-6 to printer.)
1-7 COMMITTEE AMENDMENT NO. 1 By: Lucio
1-8 Amend H.B. No. 1638 in SECTION 21 of the bill, amended
1-9 Section 845.301(a), Government Code, by striking "Investment and
1-10 management decisions concerning individual investments must be
1-11 evaluated not in isolation but in the context of the investment
1-12 portfolio as a whole and as part of an overall investment strategy
1-13 consistent with the investment objectives of the retirement
1-14 system." and substituting "Investment decisions are subject to the
1-15 standard provided in the Texas Trust Code by Section 113.056(a),
1-16 Property Code." (House Engrossment, page 18, lines 12-16).
1-17 A BILL TO BE ENTITLED
1-18 AN ACT
1-19 relating to participation and credit in, contributions to, and
1-20 benefits and administration of the Texas County and District
1-21 Retirement System.
1-22 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-23 SECTION 1. Section 841.001(1), Government Code, is amended
1-24 to read as follows:
1-25 (1) "Actuarial equivalent" means a benefit that, at
1-26 the time it is entered upon, has the same present value as the
1-27 benefit it replaces, based on seven percent annual interest and the
1-28 mortality table published by the Conference of Actuaries in Public
1-29 Practice and known as the UP-1984 table with an age setback of five
1-30 years for retired or disabled annuitants and an age setback of 10
1-31 years for beneficiaries, with a 30-percent reserve refund
1-32 assumption for the standard benefit [interest and on a mortality
1-33 table recommended by the actuary and adopted by the board of
1-34 trustees].
1-35 SECTION 2. Section 841.002, Government Code, is amended to
1-36 read as follows:
1-37 Sec. 841.002. PURPOSE OF SUBTITLE. The purpose of this
1-38 subtitle is to establish a program of benefits for members,
1-39 retirees, and their beneficiaries and to establish rules for the
1-40 management and operation of the retirement system. The assets of
1-41 the retirement system are held in trust for the exclusive benefit
1-42 of the members, the retirees, and their beneficiaries and may not
1-43 be diverted. Forfeitures may not be applied to increase the
1-44 benefits any person would otherwise receive under this subtitle.
1-45 SECTION 3. Subchapter A, Chapter 841, Government Code, is
1-46 amended by adding Sections 841.010 and 841.011 to read as follows:
1-47 Sec. 841.010. DISTRIBUTION REQUIREMENTS. Notwithstanding
1-48 any other provision of this subtitle, all distributions under this
1-49 subtitle must be determined and made in accordance with Section
1-50 401(a)(9) of the Internal Revenue Code of 1986 (26 U.S.C. Section
1-51 401), including the minimum incidental death benefit distribution
1-52 requirement of Section 401(a)(9)(G) of that code. The entire
1-53 vested interest of a participant must be distributed or begin to be
1-54 distributed not later than April 1 following the later of the year
1-55 in which the participant attains age 70-1/2 or the year in which
1-56 the participant separates from service with all participating
1-57 subdivisions. If the participant dies after distribution of the
1-58 participant's interest has begun, the remaining portion of the
1-59 interest will continue to be distributed at least as rapidly as the
1-60 method of distribution being used before the participant's death.
1-61 If the participant dies before distribution of the participant's
1-62 interest begins, distribution of the participant's entire interest
1-63 must be made in a manner complying with Section 401(a)(9)(B) of the
1-64 code.
2-1 Sec. 841.011. FULL VESTING OF ACCRUED BENEFITS AT
2-2 TERMINATION. If the retirement system is terminated or if there is
2-3 a complete discontinuance of contributions to the retirement
2-4 system, each member will become fully vested in that member's
2-5 accrued benefit to the extent funded as of the date of termination
2-6 or contribution discontinuance.
2-7 SECTION 4. Section 842.005(g), Government Code, is amended
2-8 to read as follows:
2-9 (g) If the participating subdivision continues in existence
2-10 or is succeeded by an organization, the annuities and credits
2-11 described by Subsection (e) may not be increased to a level that
2-12 exceeds the greater of the level in effect at the time Subsection
2-13 (e) became applicable or the level in effect on December 31, 1992.
2-14 [If the board of trustees determines, on the basis of computations
2-15 made by the actuary, that the available tangible assets are
2-16 materially in excess of the actuarial present value of benefits
2-17 described by Subsection (e), the board may direct that a portion of
2-18 the excess be paid to the subdivision or its successor.] When the
2-19 participating subdivision or its successor has no employees who are
2-20 members of the retirement system and has no present or potential
2-21 liabilities resulting from the participation of former employees,
2-22 the subdivision's participation in the retirement system ceases,
2-23 and the system shall repay to the subdivision or its successor the
2-24 amount in the subdivision accumulation fund that is credited to the
2-25 subdivision.
2-26 SECTION 5. Section 842.201(c), Government Code, is amended
2-27 to read as follows:
2-28 (c) A [Unless membership is waived, a] person who is made
2-29 eligible for membership in the retirement system under Subsection
2-30 (a) or (b) becomes a member on the date specified in the order of
2-31 the commissioners court.
2-32 SECTION 6. Subchapter C, Chapter 842, Government Code, is
2-33 amended by adding Section 842.204 to read as follows:
2-34 Sec. 842.204. REPEAL OF OPTION TO WAIVE OR RETURN TO
2-35 MEMBERSHIP. A person who, after December 31, 1997, is
2-36 participating in the retirement system or first becomes eligible to
2-37 participate in the retirement system under Section 842.201 may not
2-38 waive participation in the retirement system. A person who has
2-39 waived membership in the retirement system or elected not to make
2-40 contributions but who otherwise would be eligible to participate in
2-41 the retirement system under Section 842.201 is not permitted to
2-42 become a member or resume making contributions after December 31,
2-43 1997, under Section 842.201.
2-44 SECTION 7. Subchapter G, Chapter 843, Government Code, is
2-45 amended by adding Section 843.603 to read as follows:
2-46 Sec. 843.603. CURRENT SERVICE FOR REEMPLOYED VETERANS.
2-47 Notwithstanding any provision of this subtitle to the contrary,
2-48 contributions, benefits, and service credit with respect to
2-49 qualified military service will be provided in accordance with
2-50 Section 414(u) of the Internal Revenue Code of 1986 (26 U.S.C.
2-51 Section 414). The board of trustees may adopt rules that modify
2-52 the terms of this subtitle for the purpose of compliance with the
2-53 Uniformed Services Employment and Reemployment Rights Act of 1994
2-54 (38 U.S.C. Section 4301 et seq.).
2-55 SECTION 8. Sections 844.003(a) and (c), Government Code, are
2-56 amended to read as follows:
2-57 (a) Except as provided by Subsection [Subsections] (b) [and
2-58 (e)], the effective date of a member's service retirement is the
2-59 date the member designates at the time the member applies for
2-60 retirement under Section 844.101, but the date must be the last day
2-61 of a calendar month and may not precede the date the member
2-62 terminates employment with all participating subdivisions.
2-63 (c) Except as provided by Subsection [Subsections] (b) [and
2-64 (e)], the effective date of a member's disability retirement is the
2-65 date designated on the application for retirement filed by or for
2-66 the member as provided by Section 844.301, but the date may not
2-67 precede the date the member terminates employment with all
2-68 participating subdivisions.
2-69 SECTION 9. Section 844.008, Government Code, is amended to
3-1 read as follows:
3-2 Sec. 844.008. LIMITATION ON PAYMENT OF BENEFITS. (a)
3-3 Notwithstanding any other provision of this subtitle, the benefit
3-4 payable to a retiree of the retirement system may not exceed the
3-5 maximum benefit permitted under Section 415(b) of the Internal
3-6 Revenue Code of 1986 (26 U.S.C. Section 415(b)) as adjusted in
3-7 accordance with Section 415(d) of that code. Any adjustments are
3-8 applicable to the postretirement benefits of retirees as well as to
3-9 the benefits of retiring members. For the purpose of determining
3-10 whether the benefit of a retiring member or retiree exceeds the
3-11 limitations provided in this section, all defined benefit plans of
3-12 the employer and of entities required to be aggregated with the
3-13 employer for purposes of Section 415 of the Internal Revenue Code
3-14 of 1986 are to be treated as one defined benefit plan and all
3-15 defined contribution plans of the employer and of entities required
3-16 to be aggregated with the employer for purposes of Section 415 of
3-17 that code are to be treated as one defined contribution plan. The
3-18 limitation year for determining maximum benefits is the calendar
3-19 year. [In this section:]
3-20 [(1) "Annual benefit" means the total of all annuity
3-21 payments by the retirement system on behalf of a person who has
3-22 retired under this subtitle during a calendar year, including any
3-23 distributive benefit payments.]
3-24 [(2) "Compensation" has the meaning assigned by
3-25 Section 415, Internal Revenue Code, and the regulations adopted
3-26 under that section, not to exceed the limitations provided by
3-27 Section 401(a)(17) of that code, instead of the meaning assigned by
3-28 Section 841.001.]
3-29 [(3) "Highest average annual compensation" means the
3-30 average compensation for the three consecutive calendar years of
3-31 service that produces the highest average.]
3-32 [(4) "Internal Revenue Code" means the Internal
3-33 Revenue Code of 1986 (Title 26, United States Code).]
3-34 [(b) If the amount of any benefit payment under this
3-35 subtitle would exceed the limitations provided by this section, the
3-36 retirement system shall reduce the amount of the benefit in
3-37 accordance with this section.]
3-38 [(c) Except as otherwise provided by this section, a benefit
3-39 is adjusted to an actuarially equivalent straight life annuity for
3-40 the purpose of determining limitations under this section. An
3-41 actuarial adjustment to a benefit is not required for the value of
3-42 a qualified joint and survivor annuity and the value of
3-43 postretirement cost-of-living increases made in accordance with
3-44 Section 415, Internal Revenue Code.]
3-45 [(d) Except as provided by Subsections (f), (h), and (i), an
3-46 annual benefit payable by the retirement system may not exceed the
3-47 lesser of:]
3-48 [(1) $112,221, or another amount as adjusted each
3-49 January 1 by the secretary of the treasury under Section 415 of the
3-50 Internal Revenue Code of 1986 (26 U.S.C. Section 415) for
3-51 cost-of-living increases after January 1, 1992; or]
3-52 [(2) 100 percent of the former member's highest
3-53 average annual compensation, including annual cost-of-living
3-54 increases after separation from service.]
3-55 [(e) If payment of a benefit begins before a member attains
3-56 age 62, the dollar limitation is the actuarial equivalent of an
3-57 annual benefit beginning at age 62 as described by Subsection
3-58 (d)(1) for a person at age 62. A reduction under this subsection
3-59 may not reduce the dollar limitation below $75,000 if the benefit
3-60 begins at or after age 55 or, if the benefit begins before age 55,
3-61 the actuarial equivalent of a $75,000 limitation beginning at age
3-62 55.]
3-63 [(f) If payment of a benefit begins after the member attains
3-64 age 65, the dollar limitation is the actuarial equivalent of an
3-65 annual benefit beginning at age 65 as described by Subsection
3-66 (d)(1).]
3-67 [(g) To determine actuarial equivalence, the interest rate
3-68 assumption under Subsection (c) or (e) is the greater of the rate
3-69 specified by Section 845.314(a) or five percent, and the interest
4-1 rate assumption under Subsection (f) is the lesser of those rates.]
4-2 [(h) The limitations provided by Subsections (d), (e), and
4-3 (f) do not apply to any portion of an annual benefit payable by the
4-4 retirement system that is paid from the balance in the member's
4-5 individual account in the employees saving fund as of December 31,
4-6 1985, or from interest credited to the member's account after
4-7 December 31, 1985, as a result of deposits before that date.]
4-8 [(i) This section may not be applied to reduce the annual
4-9 benefit payable to any person who retired under the retirement
4-10 system before January 1, 1994, or to reduce the vested accrued
4-11 benefit as of December 31, 1993, of any person who was a member of
4-12 the retirement system on that date.]
4-13 [(j) If the Internal Revenue Code is amended in such a
4-14 manner that limitations similar to those provided by this section
4-15 are not required of governmental retirement plans to constitute
4-16 qualified plans, the board of trustees may by rule eliminate all or
4-17 any portion of the limitations provided by this section.]
4-18 (b) [(k)] An employer may not provide employee retirement or
4-19 deferred benefits under a plan other than the retirement system to
4-20 the extent that the provision of the benefits, when considered
4-21 together with the benefits provided under the retirement system
4-22 [authorized by this subtitle as required by the Internal Revenue
4-23 Code], would result in the failure of the retirement system
4-24 [system's plan] to meet any of the limitation requirements of
4-25 Section 415 of the Internal Revenue Code of 1986 (26 U.S.C.
4-26 Section 415), and the benefits of the other plan will automatically
4-27 be reduced, eliminated, or adjusted to the extent necessary to
4-28 prevent the failure [federal qualification standards as applied to
4-29 governmental retirement plans].
4-30 [(l) The annual benefit payable by the retirement system
4-31 that is otherwise limited by Subsection (d) may be increased each
4-32 year in accordance with cost-of-living adjustments by the secretary
4-33 of the treasury of the dollar limitation or the compensation
4-34 limitation as long as it does not exceed the amount that would be
4-35 payable without limitation of Section 415 of the Internal Revenue
4-36 Code of 1986 (26 U.S.C. Section 415).]
4-37 [(m) The limitations provided by this section may not be
4-38 applied to reduce the benefit of any person whose retirement
4-39 benefits under this and all other defined benefit plans of the
4-40 member's employer do not exceed $10,000, plus the benefit provided
4-41 by Subsection (h), for the plan year or for any previous plan year
4-42 and who has not at any time participated in a defined contribution
4-43 plan maintained by the person's employer.]
4-44 SECTION 10. Section 844.209, Government Code, is amended by
4-45 adding Subsection (g) to read as follows:
4-46 (g) If a member to whom Subsection (b) otherwise would be
4-47 applicable dies without having a valid beneficiary designation on
4-48 file with the retirement system, the member's estate will be
4-49 considered to be the designated beneficiary if the member died
4-50 before becoming eligible to make a selection under Section 844.105,
4-51 844.106, 844.207, or 844.210. The executor or administrator of the
4-52 estate or, if there is no executor or administrator, the persons
4-53 entitled to receive the member's estate may elect to receive, in
4-54 lieu of the accumulated deposits, the optional benefit described by
4-55 Section 844.104(c)(4). The election may be made only by filing
4-56 written notice with the board of trustees together with either a
4-57 certified copy of the court order or an affidavit meeting the
4-58 requirements of Section 137, Texas Probate Code. An election by
4-59 those persons may be made only if all of the persons entitled to
4-60 the member's accumulated contributions agree in writing on the
4-61 selection of the option.
4-62 SECTION 11. Section 844.401(a), Government Code, is amended
4-63 to read as follows:
4-64 (a) Except as provided by Subsection (c), if a member dies
4-65 before retirement, a lump-sum death benefit is payable from the
4-66 employees saving fund in the amount of:
4-67 (1) the accumulated contributions in the member's
4-68 individual account in the fund; plus
4-69 (2) interest computed from the beginning of the year
5-1 in which death occurs through the end of the month before the month
5-2 in which death occurs on the balance in the member's individual
5-3 account in the employees saving fund on January 1 of the year in
5-4 which the member's death occurs [at the rate allowed on member
5-5 contributions during the preceding year].
5-6 SECTION 12. Sections 844.605(a) and (c), Government Code,
5-7 are amended to read as follows:
5-8 (a) If the actuary determines that the obligations of a
5-9 participating subdivision to the subdivision accumulation fund
5-10 cannot be amortized within a period of 40 years or determines that
5-11 subdivision contributions at the rate in accordance with Section
5-12 845.404(a)(2) and any supplemental contribution rate adopted by the
5-13 subdivision under this section are inadequate to fund all
5-14 obligations charged against the subdivision's account in the
5-15 subdivision accumulation fund, the governing body of the
5-16 subdivision may by order or resolution provide additional
5-17 contributions by adopting a supplemental contribution rate under
5-18 this section to reduce the funding period. [A supplemental
5-19 contribution rate adopted under this section also may be authorized
5-20 by the governing body of a subdivision for the purpose of restoring
5-21 the level of benefits in effect for that subdivision that existed
5-22 on January 1, 1994.]
5-23 (c) A supplemental contribution rate adopted by a
5-24 participating subdivision may not be increased unless the actuary
5-25 subsequently makes the determination described by Subsection (a)
5-26 [determines that the rate previously adopted, together with the
5-27 contributions provided under Section 845.404(a)(2), will not
5-28 amortize the obligations of the subdivision to the subdivision
5-29 accumulation fund within a period of 40 years after the actuarial
5-30 study date]. If the actuary makes the determination specified by
5-31 this subsection, the governing body of the subdivision may adopt
5-32 another supplemental contribution rate under this section.
5-33 SECTION 13. The heading of Section 844.606, Government Code,
5-34 is amended to read as follows:
5-35 Sec. 844.606. [ADDITIONAL] OPTIONAL DECREASE IN CREDITS.
5-36 SECTION 14. Section 844.606(a), Government Code, is amended
5-37 to read as follows:
5-38 (a) If the actuary has made the determination described by
5-39 Section 844.605(a) [determines that the obligations of a
5-40 participating subdivision to the subdivision accumulation fund
5-41 cannot be amortized within a period of 40 years], the governing
5-42 body of the subdivision may by order or resolution reduce multiple
5-43 matching credits for contributions made after the effective date of
5-44 the reduction.
5-45 SECTION 15. Sections 844.607(a) and (b), Government Code,
5-46 are amended to read as follows:
5-47 (a) If the actuary has made the determination described by
5-48 Section 844.605(a)[, provided for by Section 844.601(b), that a
5-49 subdivision's contributions are inadequate to fund all obligations
5-50 charged against its account in the subdivision accumulation fund]
5-51 and has made the determination, provided for by Section 844.606(b),
5-52 of the lower percentage to be used for multiple matching credits of
5-53 future member contributions that is necessary to make the financing
5-54 arrangement adequate, the actuary shall give written notice of the
5-55 determinations to the director, who shall give written notice to
5-56 the governing body of the subdivision.
5-57 (b) If the governing body of the subdivision does not adopt
5-58 an order or resolution that is approved by the board of trustees,
5-59 authorizing additional subdivision contributions under Section
5-60 844.605, authorizing a reduction in multiple matching credits under
5-61 Section 844.606, or authorizing both additional contributions and a
5-62 reduction in multiple matching credits, and that takes effect
5-63 [described by Subsection (c) effective] on the first day of the
5-64 first calendar year that begins at least 90 days after the date of
5-65 the notice under Subsection (a), the lower percentage to be used
5-66 for multiple matching credits on future member contributions as
5-67 contained in the notice to the governing body becomes effective as
5-68 to all members who perform current service for the affected
5-69 subdivision on or after the first day of that calendar year
6-1 [actuary shall make new determinations, provided for by Sections
6-2 844.601(b) and 844.606(b), based on the most recent actuarial
6-3 valuation. The actuary shall give written notice of these
6-4 determinations to the director, who shall give a second written
6-5 notice to the governing body of the subdivision].
6-6 SECTION 16. Section 844.608(b), Government Code, is amended
6-7 to read as follows:
6-8 (b) If the actuary determines that, despite all required
6-9 decreases described by Section 844.607, the obligations of a
6-10 participating subdivision to the subdivision accumulation fund
6-11 cannot be amortized within a period of 25 [40] years, the
6-12 retirement system shall reduce the rate of member contributions to
6-13 such lower rate authorized by this section as, in the opinion of
6-14 the actuary, is required for the obligations of the subdivision to
6-15 the subdivision accumulation fund to be able to be amortized within
6-16 a period of 25 [40] years. At the time the actuary determines that
6-17 the rate of employee contributions no longer must be reduced for
6-18 the obligations to be able to be amortized within 25 [40] years,
6-19 the retirement system shall reinstate the employee contribution
6-20 rate to the rate that was in effect at the time of the reduction,
6-21 unless the governing body of the subdivision has elected to change
6-22 to some other rate authorized by Section 845.402. Any change under
6-23 this section shall be made on January 1 of the year following the
6-24 applicable determination by the actuary.
6-25 SECTION 17. Sections 844.703(b), (c), (d), and (f),
6-26 Government Code, are amended to read as follows:
6-27 (b) Each subdivision adopting the plan provisions of this
6-28 subchapter shall pay to the subdivision accumulation fund, as its
6-29 prior service contribution, an amount equal to a percentage of the
6-30 compensation of members employed by the subdivision for that month.
6-31 The rate of contribution is the rate determined annually by the
6-32 actuary and approved by the board of trustees as being the rate
6-33 required to fund all unfunded obligations charged against the
6-34 subdivision's account in the subdivision accumulation fund within
6-35 the subdivision's amortization period without probable future
6-36 depletion of that account or, if there are no unfunded obligations,
6-37 the rate required to amortize any overfunded obligations within a
6-38 period of 30 years [in perpetuity].
6-39 (c) The combined rates of a subdivision's normal
6-40 contributions and prior service contributions under this subchapter
6-41 may not exceed 11 percent [the rate determined as the employee
6-42 contribution rate plus three percent, except that the governing
6-43 body of the subdivision may elect to increase the maximum combined
6-44 rate to not more than the rate determined as the employee rate plus
6-45 four percent, if necessary in order to maintain the current level
6-46 of benefits or to restore the level of benefits in effect on
6-47 January 1, 1994. A reduction of the member contribution rate for
6-48 employees of the subdivision does not reduce the maximum rate of
6-49 contribution of the subdivision].
6-50 (d) The actuary annually shall determine the subdivision
6-51 normal contribution rate and the prior service contribution rate
6-52 for subdivisions adopting the plan provisions of this subchapter
6-53 from the most recent data available at the time of determination.
6-54 Before January 1 of each year, the board of trustees shall certify
6-55 the rates of each subdivision that has adopted the plan provisions
6-56 of this subchapter. If the combined rates of the subdivision's
6-57 normal contributions and prior service contributions under this
6-58 subchapter exceed the rate prescribed by Subsection (c), the rate
6-59 for prior service contributions must be reduced to the rate that
6-60 equals the difference between the maximum rate prescribed by
6-61 Subsection (c) and the normal contribution rate. The governing
6-62 body may elect to contribute at a rate that is an integer percent
6-63 but not more than the maximum rate prescribed by Subsection (c) if
6-64 that rate exceeds the sum of the subdivision's normal contribution
6-65 rate and its prior service contribution rate as determined under
6-66 Subsections (a) and (b). This elected rate remains in effect for
6-67 each subsequent calendar year until it is rescinded by the
6-68 governing body or until the sum of the rates determined under
6-69 Subsections (a) and (b) exceeds the elected rate, at which time the
7-1 governing body must contribute the sum of the rates determined
7-2 under Subsections (a) and (b). For years in which the elected
7-3 rate exceeds the sum of the rates determined under Subsections (a)
7-4 and (b), the prior service contribution rate is increased to the
7-5 rate that equals the difference between the elected rate and the
7-6 normal contribution rate prescribed by Subsection (a). [If for any
7-7 year the combined rates of a subdivision's normal contribution rate
7-8 and its prior service contribution rate as determined under
7-9 Subsections (a) and (b) are less than the subdivision's employee
7-10 contribution rate, the governing body of the subdivision may elect
7-11 that the subdivision make normal contributions and prior service
7-12 contributions for that year at a combined rate equal to the
7-13 employee contribution rate for that year.]
7-14 (f) The prior service contribution rate prescribed by
7-15 Subsection (b) must be based on an open or closed amortization
7-16 period as recommended by the actuary and adopted by the board of
7-17 trustees but may not exceed 30 years. The board of trustees may
7-18 establish criteria for the circumstances under which a
7-19 subdivision's amortization period, if closed, will be renewed,
7-20 extended, or shortened. [The governing body of the subdivision has
7-21 25 years beginning with the effective date of the plan provisions
7-22 of this subchapter to amortize all unfunded obligations against the
7-23 subdivision's account in the subdivision accumulation fund. The
7-24 adoption of any of the following benefit increases after the
7-25 effective date of the plan provisions will result in a new
7-26 amortization period of 25 years beginning with the effective date
7-27 of the benefit increases:]
7-28 [(1) an increase in the percentage used in determining
7-29 multiple matching credits under Section 844.704(a);]
7-30 [(2) an increase in the percentage used in determining
7-31 allocated prior service credits under Section 844.704(b);]
7-32 [(3) the optional increase in retirement annuities
7-33 under Section 844.208;]
7-34 [(4) the optional benefit for a surviving beneficiary
7-35 of a member described by Section 844.209;]
7-36 [(5) the optional benefit eligibility plan described
7-37 by Section 844.210;]
7-38 [(6) the optional benefit eligibility plan described
7-39 by Section 844.211;]
7-40 [(7) the optional authorization of the reestablishment
7-41 of credited service previously forfeited under Section 843.003; or]
7-42 [(8) the optional election to have credits recomputed
7-43 on the basis of total compensation under Section 843.702.]
7-44 SECTION 18. Section 845.108, Government Code, is amended to
7-45 read as follows:
7-46 Sec. 845.108. DESIGNATION OF AUTHORITY TO DISBURSE FUNDS
7-47 [SIGN VOUCHERS]. The director is authorized to sign checks and
7-48 authorize fund transfers [board of trustees by resolution shall
7-49 designate one or more representatives who have authority to sign
7-50 vouchers] for payments from the assets of the retirement system.
7-51 The director may designate in writing additional persons to have
7-52 authority to sign checks and authorize fund transfers for payments
7-53 from the assets of the retirement system.
7-54 SECTION 19. Section 845.202(d), Government Code, is amended
7-55 to read as follows:
7-56 (d) The director annually shall:
7-57 (1) prepare an itemized budget showing the amount
7-58 required to pay the retirement system's administrative expenses for
7-59 the following fiscal year; and
7-60 (2) submit the administrative budget [report] to the
7-61 board for review, amendment, and adoption.
7-62 SECTION 20. Section 845.206(d), Government Code, is amended
7-63 to read as follows:
7-64 (d) On the basis of tables and rates adopted by the board,
7-65 the actuary shall[:]
7-66 [(1) compute the current interest rate in accordance
7-67 with Section 845.314; and]
7-68 [(2)] make an annual valuation of the assets and
7-69 liabilities of the [funds of the] retirement system and of each
8-1 participating subdivision with regard to the retirement system.
8-2 SECTION 21. Section 845.301, Government Code, is amended by
8-3 amending Subsections (a) and (b) and adding Subsection (f) to read
8-4 as follows:
8-5 (a) The assets of the retirement system shall be invested
8-6 and reinvested without distinction as to their source in accordance
8-7 with Section 67, Article XVI, Texas Constitution. Investment and
8-8 management decisions concerning individual investments must be
8-9 evaluated not in isolation but in the context of the investment
8-10 portfolio as a whole and as part of an overall investment strategy
8-11 consistent with the investment objectives of the retirement system.
8-12 [The board of trustees shall invest and reinvest the assets of the
8-13 retirement system without distinction as to their source in:]
8-14 [(1) interest-bearing bonds or other evidences of
8-15 indebtedness of this state, a county, school district, city, or
8-16 other municipal corporation of this state, the United States, or an
8-17 authority or an agency of the United States;]
8-18 [(2) securities for which the United States or any
8-19 authority or agency of the United States guarantees the payment of
8-20 principal and interest;]
8-21 [(3) interest-bearing bonds, notes, or other evidences
8-22 of indebtedness that are issued by a company:]
8-23 [(A) incorporated in the United States and that
8-24 are rated "A" or better by one or more nationally recognized rating
8-25 agencies approved by the board; or]
8-26 [(B) in whose stock the retirement system may
8-27 invest as provided by Subdivision (4);]
8-28 [(4) common or preferred stocks of a company
8-29 incorporated in the United States that, unless the stocks are bank
8-30 or insurance stocks, is listed on an exchange registered with the
8-31 Securities and Exchange Commission or its successor;]
8-32 [(5) obligations issued, assumed, or guaranteed by the
8-33 Inter-American Development Bank, the International Bank for
8-34 Reconstruction and Development (the World Bank), the African
8-35 Development Bank, the Asian Development Bank, and the International
8-36 Finance Corporation;]
8-37 [(6) real estate mortgage investment conduit
8-38 securities (REMICs) or other participation certificates issued by
8-39 the Federal National Mortgage Corporation or by the Federal Home
8-40 Loan Mortgage Corporation, evidencing an undivided beneficial
8-41 interest in pools of real estate mortgage notes that are guaranteed
8-42 as to payment of principal and interest by the issuer, or by any
8-43 agency, authority, or instrumentality of the United States, and
8-44 that are to be held in trust by the issuer for the benefit of the
8-45 certificate holder; or]
8-46 [(7) bonds issued, assumed, or guaranteed by the state
8-47 of Israel.]
8-48 (b) The board of trustees shall exercise control of the
8-49 investment operations by employing an investment officer, who shall
8-50 supervise the investment operations for the board of trustees. The
8-51 investment officer shall prepare and submit to the board for
8-52 review, amendment, and adoption an itemized budget showing the
8-53 amount required to pay the investment expenses of the retirement
8-54 system for the following fiscal year.
8-55 (f) The board of trustees shall establish written investment
8-56 objectives concerning the investment of assets of the retirement
8-57 system.
8-58 SECTION 22. Section 845.305, Government Code, is amended to
8-59 read as follows:
8-60 Sec. 845.305. CREDITING SYSTEM ASSETS. (a) The retirement
8-61 system shall immediately deposit all money received by the system
8-62 with a depository designated under Section 845.109 or a custodian
8-63 designated under Section 845.302.
8-64 (b) [When securities of the retirement system are received,
8-65 the system shall deposit the securities in trust with a depository
8-66 designated under Section 845.109. The depository shall provide
8-67 adequate safe deposit facilities for the preservation of the
8-68 securities.]
8-69 [(c)] All assets of the retirement system shall be credited
9-1 according to the purpose for which they are held to one of the
9-2 following funds:
9-3 (1) employees saving fund;
9-4 (2) subdivision accumulation fund;
9-5 (3) current service annuity reserve fund;
9-6 (4) interest fund;
9-7 (5) endowment fund;
9-8 (6) expense fund; or
9-9 (7) supplemental death benefits fund.
9-10 SECTION 23. Section 845.307(a), Government Code, is amended
9-11 to read as follows:
9-12 (a) The retirement system shall deposit in the account of a
9-13 participating subdivision in the subdivision accumulation fund:
9-14 (1) all benefit contributions made by the subdivision
9-15 to the system pursuant to Section 845.404(a)(2);
9-16 (2) income and interest allocated to [interest allowed
9-17 on money in] the fund as provided by this subtitle;
9-18 (3) amounts deposited by the subdivision in accordance
9-19 with former Section 845.405 to establish credited service during a
9-20 time of war;
9-21 (4) the withdrawal charge for reinstatement of
9-22 credited service as provided by Section 843.003 or 843.404;
9-23 (5) the amount of matching contributions made by a
9-24 subdivision in accordance with Section 843.301(c) or 843.402(c) to
9-25 establish credit for prior or current service for a person who
9-26 became a member in accordance with Subchapter C of Chapter 842;
9-27 (6) the amount of matching contributions made by a
9-28 subdivision in accordance with Section 843.601(f) to establish
9-29 current service credit for military service;
9-30 (7) the amount of matching contributions made by a
9-31 subdivision in accordance with Section 843.501 to establish credit
9-32 for legislative service; and
9-33 (8) the amount deposited by a subdivision for a person
9-34 to become a member in accordance with Section 842.103.
9-35 SECTION 24. Section 845.309, Government Code, is amended to
9-36 read as follows:
9-37 Sec. 845.309. INTEREST FUND. (a) The [retirement system
9-38 shall deposit in the] interest fund must contain accounts for:
9-39 (1) distributable income;
9-40 (2) nondistributable income;
9-41 (3) investment expenses; and
9-42 (4) other accounts the board of trustees establishes
9-43 by resolution [all income, interest, and dividends from deposits
9-44 and investments authorized by this subtitle].
9-45 (b) On December 31 of each year, the nondistributable income
9-46 account will be adjusted by the net change in carrying value
9-47 necessary to value at market all domestic, fixed-income securities
9-48 owned by the retirement system as part of a passively managed,
9-49 long-term portfolio [system shall transfer money from the interest
9-50 fund in accordance with Section 845.315].
9-51 (c) The distributable income account will be credited with:
9-52 (1) all income, interest, and dividends from deposits
9-53 and investments of the retirement system;
9-54 (2) all changes in carrying value of the investments
9-55 described by Subsection (b) resulting from amortization, accretion,
9-56 accrual of interest payments as principal, or other change in
9-57 carrying value not resulting from a change in market value;
9-58 (3) all net capital gains and losses resulting from
9-59 the sale, call, maturity, or conversion of investments of the
9-60 retirement system;
9-61 (4) all changes in carrying values of investments of
9-62 the retirement system except those to be credited in accordance
9-63 with Subsection (b); and
9-64 (5) any amounts that the board of trustees transfers
9-65 under Section 845.310(e).
9-66 (d) The investment expenses account will be charged with the
9-67 costs attributable to the management, selection, acquisition,
9-68 maintenance, oversight, and disposal of all investments of the
9-69 retirement system.
10-1 (e) On December 31 of each year, the amount remaining in the
10-2 distributable income account and the investment expenses account
10-3 shall be distributed in the manner prescribed by this subtitle.
10-4 SECTION 25. Sections 845.310(b), (c), and (e), Government
10-5 Code, are amended to read as follows:
10-6 (b) The endowment fund consists of:
10-7 (1) the general reserves account;
10-8 (2) [the distributive benefits account;]
10-9 [(3)] the perpetual endowment account; and
10-10 (3) [(4)] other special accounts that the board of
10-11 trustees by resolution establishes.
10-12 (c) The system shall credit to the general reserves account
10-13 income allocated to the endowment fund [and to the distributive
10-14 benefits account interest] in accordance with Section 845.315.
10-15 (e) If the board of trustees determines that the amount in
10-16 the general reserves account as of December 31 of any year is in
10-17 excess of the amount necessary to provide adequate funding and
10-18 reserves for all needs and contingencies, the board may by
10-19 resolution transfer part or all of the excess to the distributable
10-20 income account of the interest fund for distribution. [credited to
10-21 the distributive benefits account on December 31 of any year is
10-22 sufficient to do so, the board by resolution may:]
10-23 [(1) authorize the distribution to the subdivision
10-24 accumulation fund of all or part of the amount that is credited to
10-25 the account and that is equal to the amount in the subdivision
10-26 accumulation fund on January 1 of the year multiplied by:]
10-27 [(A) two percent or more when the current
10-28 interest rate is equal to the rate prescribed by Section
10-29 845.314(a); or]
10-30 [(B) two percent when the current interest rate
10-31 is less than the rate prescribed by Section 845.314(a);]
10-32 [(2) authorize the distribution and payment of all or
10-33 part of the money credited to the account to persons who were
10-34 annuitants on that day in the ratio that the monthly benefit of
10-35 each annuitant would bear if not reduced under Section 844.008 to
10-36 the total of all annuity payments that would have been made by the
10-37 system, if not reduced under Section 844.008, for the final month
10-38 of the year; or]
10-39 [(3) authorize the distribution of all or part of the
10-40 amount credited to the account to:]
10-41 [(A) each member's individual account in the
10-42 employees saving fund as supplemental interest in the ratio of the
10-43 amount of current interest paid on the individual's account to the
10-44 current interest paid to all individual accounts for the year; and]
10-45 [(B) each participating subdivision's account in
10-46 the subdivision accumulation fund as supplemental interest in the
10-47 ratio of the current interest allowed on the account of the
10-48 subdivision to the total current interest paid to all subdivisions'
10-49 accounts for the year.]
10-50 SECTION 26. Section 845.311, Government Code, is amended to
10-51 read as follows:
10-52 Sec. 845.311. EXPENSE FUND. (a) [The board of trustees
10-53 shall deposit in the expense fund:]
10-54 [(1) membership fees paid in accordance with Section
10-55 845.401; and]
10-56 [(2) subdivision contributions for expenses of the
10-57 retirement system paid in accordance with Section 845.404.]
10-58 [(b)] The board of trustees by resolution recorded in its
10-59 minutes shall transfer from the general reserves account of the
10-60 endowment fund to the expense fund the amount [that exceeds the
10-61 amount needed to provide adequate reserves against insufficient
10-62 earnings on investments and against special and contingency
10-63 requirements of other funds of the system and] that is needed to
10-64 pay the system's estimated cash outlays for administrative and
10-65 investment expenses for the next fiscal year.
10-66 (b) [(c)] The retirement system shall pay from the expense
10-67 fund:
10-68 (1) administrative and maintenance expenses of the
10-69 system; [and]
11-1 (2) notes and bonds issued in accordance with Section
11-2 845.105; and
11-3 (3) investment expenses of the system.
11-4 [(d) If the amount of the system's estimated expenses
11-5 exceeds the amount in the general reserves account available for
11-6 administrative expenses, the board of trustees, by a resolution
11-7 recorded in its minutes, shall require an amount equal to the
11-8 difference from participating subdivisions and members. The board
11-9 shall collect the required amount and deposit the amount collected
11-10 in the expense fund.]
11-11 SECTION 27. Section 845.313, Government Code, is amended to
11-12 read as follows:
11-13 Sec. 845.313. DISBURSEMENTS. (a) Disbursements from the
11-14 assets of the retirement system may be made by check, electronic
11-15 funds transfer, or any other means generally available within the
11-16 banking industry and must be [only on vouchers] signed or otherwise
11-17 authorized by a [by the] person designated for that purpose in
11-18 accordance with Section 845.108.
11-19 (b) [A person designated to sign vouchers may draw checks or
11-20 warrants only on proper authorization from the board of trustees,
11-21 recorded in the official minutes of the meetings of the board.]
11-22 [(c)] When a check or fund transfer [voucher] is properly
11-23 signed or otherwise authorized, a depository with which assets of
11-24 the system are deposited shall accept and pay the check or complete
11-25 the fund transfer [voucher]. The depository is released from
11-26 liability for payment made on the check or authorized fund
11-27 transfer [voucher].
11-28 SECTION 28. Section 845.314(c), Government Code, is amended
11-29 to read as follows:
11-30 (c) The current interest rate is seven percent for calendar
11-31 years after December 31, 1996. [the lesser of:]
11-32 [(1) the interest rate prescribed by Subsection (a);
11-33 or]
11-34 [(2) the interest rate computed by:]
11-35 [(A) adding the mean amounts in the current
11-36 service annuity reserve fund and the supplemental death benefits
11-37 fund during the year and multiplying the sum by the rate prescribed
11-38 by Subsection (a);]
11-39 [(B) multiplying the amount in the subdivision
11-40 accumulation fund on January 1 of the year by two percent;]
11-41 [(C) subtracting the sum of the amount computed
11-42 under Paragraphs (A) and (B), plus an amount equal to the sum of
11-43 all interest credited during the year to the employees saving fund
11-44 accounts of members as provided by Section 844.007(b) and to the
11-45 subdivision accumulation fund as provided by Section 844.007(c),
11-46 plus an amount equal to the amount to be transferred to the expense
11-47 fund for administrative expenditures of the retirement system for
11-48 the following year, from an amount equal to the amount in the
11-49 interest fund on December 31 of the year, before transfers of
11-50 interest to other funds are made;]
11-51 [(D) adding an amount equal to the amount in the
11-52 endowment fund on January 1 of the year, an amount equal to the
11-53 amount in the subdivision accumulation fund on January 1 of the
11-54 year, and an amount equal to the sum of the accumulated deposits in
11-55 the employees saving fund on January 1 of the year of all persons
11-56 who are members on December 31 of the year, before any transfers
11-57 for retirements effective December 31 are made; and]
11-58 [(E) dividing the amount computed under
11-59 Paragraph (C) by the amount computed under Paragraph (D) and
11-60 expressing the result to the nearest one-tenth of one percent.]
11-61 SECTION 29. Sections 845.315(a) and (b), Government Code,
11-62 are amended to read as follows:
11-63 (a) On December 31 of each year and after the balance of the
11-64 investment expenses account has been transferred to the
11-65 distributable income account, the board of trustees shall transfer
11-66 from the distributable income account of the interest fund the
11-67 following amounts:
11-68 (1) to the current service annuity reserve fund,
11-69 interest on the mean amount in the current service annuity reserve
12-1 fund during that year;
12-2 (2) to the supplemental death benefits fund, interest
12-3 on the mean amount in the supplemental death benefits fund during
12-4 [subdivision accumulation fund, current interest on the amount in
12-5 the subdivision accumulation fund on January 1 of] that year;
12-6 (3) to the general reserves account of the endowment
12-7 fund, a dollar amount determined by the board of trustees as
12-8 necessary to provide adequate funding of the endowment fund,
12-9 including provisions for all special needs, all contingencies,
12-10 replenishment of the amount transferred during the current year to
12-11 the employees saving fund for interest to retiring or deceased
12-12 members plus the matching amount transferred to the subdivision
12-13 accumulation fund, and funding of investment expenses and
12-14 administrative costs for the following [current interest on the
12-15 amount in the endowment fund on January 1 of that] year;
12-16 (4) to the employees saving fund, current interest on
12-17 the sum of the accumulated deposits in the employees saving fund
12-18 credited on January 1 of that year to all persons who are members
12-19 on December 31 of that year before any transfers for retirement
12-20 effective December 31 of that year are made; and
12-21 (5) to the subdivision accumulation fund, the
12-22 remaining balance of the distributable income account in the
12-23 interest fund after transfers provided for by Subdivisions (1),
12-24 (2), (3), and (4) have been made [supplemental death benefits fund,
12-25 interest on the mean amount in the supplemental death benefits fund
12-26 during that year].
12-27 (b) The account of each subdivision, other than a
12-28 subdivision that has ceased participation, will receive a share of
12-29 the amount transferred under Subsection (a)(5) that is in
12-30 proportion to the amount that the balance credited to its account
12-31 on January 1 bears to the total credited to the subdivision
12-32 accumulation fund on that date. [The board of trustees shall
12-33 transfer to the general reserves account of the endowment fund the
12-34 portion of the amount remaining in the interest fund after the
12-35 transfers required by Subsection (a) are made that the board of
12-36 trustees determines is necessary:]
12-37 [(1) to provide adequate reserves against insufficient
12-38 future earnings on investments to allow interest on the system's
12-39 funds;]
12-40 [(2) to provide adequate reserves against special and
12-41 contingency requirements of other funds of the system; and]
12-42 [(3) to provide the amount required for the
12-43 administrative expenses of the system for the following year.]
12-44 SECTION 30. Sections 845.402(b) and (c), Government Code,
12-45 are amended to read as follows:
12-46 (b) The governing body of a participating subdivision may
12-47 increase the rate of its member contributions effective on the
12-48 first day of any calendar year [after the first anniversary of the
12-49 effective date of the existing rate].
12-50 (c) The governing body of a participating subdivision may
12-51 reduce the rate of its member contributions effective on the first
12-52 day of any calendar year if, at least 90 days before the date of
12-53 the reduction, the subdivision has given written notice of the
12-54 reduction to [only after the fifth anniversary of the effective
12-55 date of the existing rate and only if] the board of trustees and if
12-56 the actuary determines that[, according to the computations of the
12-57 actuary approved by the board of trustees,] the reduction would not
12-58 impair the ability of the subdivision to fund all obligations
12-59 against its account in the subdivision accumulation fund before the
12-60 25th anniversary of the subdivision's most recent actuarial
12-61 valuation date.
12-62 SECTION 31. Section 845.501(a), Government Code, is amended
12-63 to read as follows:
12-64 (a) As soon as possible after the end of each calendar year,
12-65 the board of trustees shall send to the governing body of each
12-66 subdivision and to each requesting member an annual statement that
12-67 contains the basic financial statements of the retirement system [:]
12-68 [(1) a balance sheet showing the financial and
12-69 actuarial condition of the retirement system at the end of the
13-1 calendar year;]
13-2 [(2) a statement showing the receipts and
13-3 disbursements made during the calendar year;]
13-4 [(3) a statement showing changes in the asset,
13-5 liability, reserve, and surplus accounts during the calendar year;
13-6 and]
13-7 [(4) additional statistics necessary for proper
13-8 interpretation of the condition of the retirement system].
13-9 SECTION 32. Subchapter F, Chapter 845, Government Code, is
13-10 amended by adding Sections 845.505, 845.506, and 845.507 to read as
13-11 follows:
13-12 Sec. 845.505. CLOSING OF ACCOUNTS. (a) If a valid
13-13 application for an annuity or for a refund of the accumulated
13-14 contributions of a former member whose membership has terminated
13-15 under Section 842.109(a)(1) has not been filed with the retirement
13-16 system before the end of the year in which the member dies, the
13-17 retirement system shall mail the notice described by Subsection (d)
13-18 to the most recent address of the decedent's beneficiary as shown
13-19 on system records or, if there is none, to the decedent's most
13-20 recent address as shown on system records. If the notice is
13-21 returned undelivered, the retirement system will make reasonable
13-22 efforts to locate the beneficiary or personal representative. If a
13-23 valid application for an annuity or for a refund of the accumulated
13-24 contributions of a deceased member is not filed with the retirement
13-25 system before the expiration of 180 days after the date the notice
13-26 is sent, the retirement system shall transfer the accumulated
13-27 contributions in the decedent's individual account in the employees
13-28 saving fund to the perpetual endowment account of the endowment
13-29 fund and close the decedent's account.
13-30 (b) On termination of a person's membership under Section
13-31 842.109(a)(4), the retirement system shall mail the notice
13-32 described by Subsection (d) to the former member's most recent
13-33 address as shown on system records. If the notice is returned
13-34 undelivered, the retirement system will make reasonable efforts to
13-35 locate the former member. If a valid application for a refund of
13-36 the accumulated contributions of the former member is not filed
13-37 with the retirement system before the expiration of 180 days after
13-38 the date the notice is sent, the retirement system shall transfer
13-39 the accumulated contributions in the former member's individual
13-40 account in the employees saving fund to the perpetual endowment
13-41 account of the endowment fund and close the former member's
13-42 account.
13-43 (c) If a valid application for retirement or for a refund of
13-44 the accumulated contributions of a member who is no longer in
13-45 covered employment is not filed with the retirement system before
13-46 the end of the later of the year in which the member reaches age
13-47 70-1/2 or the year in which the member terminates covered
13-48 employment, the retirement system shall mail the notice described
13-49 by Subsection (d) to the member at the member's most recent address
13-50 as shown on system records. If the notice is returned undelivered,
13-51 the retirement system will make reasonable efforts to locate the
13-52 member. If a valid application for retirement or for a refund of
13-53 the accumulated contributions of the member is not filed with the
13-54 retirement system before March 15 of the year in which distribution
13-55 must be made under Section 841.010, the person's membership
13-56 terminates as of March 31 of that year, and the retirement system
13-57 shall transfer the accumulated contributions in the member's
13-58 individual account in the employees saving fund to the perpetual
13-59 endowment account of the endowment fund and close the member's
13-60 account.
13-61 (d) A notice under this section must include the name of the
13-62 member or former member, the name of each subdivision from which
13-63 the person received service credit, a statement that a benefit is
13-64 currently payable, a statement of the procedure for obtaining
13-65 payment of that benefit, and a statement that a failure to file a
13-66 valid application for benefits may cause benefits to be forfeited
13-67 to the retirement system.
13-68 (e) If a person files with the retirement system a valid
13-69 application for retirement based on an account that has been closed
14-1 under Subsection (a), (b), or (c), the retirement system shall
14-2 restore the member's individual account in the employees saving
14-3 fund and pay a retirement annuity computed as of the date on which
14-4 the annuity would have been required to begin under this subtitle.
14-5 All annuity payments that previously would have been paid if the
14-6 annuity had begun on the date required under this subtitle will be
14-7 paid to the person as a single sum.
14-8 (f) If a person files with the retirement system a valid
14-9 application for a refund of a member's accumulated contributions
14-10 based on an account that has been closed under Subsection (a), (b),
14-11 or (c), the retirement system shall pay to the applicant from the
14-12 perpetual endowment account of the endowment fund the amount to
14-13 which the applicant is entitled.
14-14 (g) If a person receiving an annuity fails to negotiate more
14-15 than five consecutive annuity payments, the retirement system may
14-16 send a notice to that person, stating that unless the previous
14-17 payments are negotiated within 30 days after the date of the
14-18 notice, payment of benefits will be suspended and the account
14-19 closed until the person files a written request with the retirement
14-20 system to resume payments. After receipt of a written request
14-21 under this subsection, the retirement system will resume making
14-22 monthly payments. All annuity payments that would have otherwise
14-23 been paid if the annuity had not been suspended will be paid to the
14-24 person as a single sum.
14-25 (h) On the death of a person receiving an annuity, the
14-26 retirement system shall make reasonable efforts to locate any
14-27 person to whom annuity payments should continue to be made as a
14-28 result of that death and to notify that person of any information
14-29 necessary in order to make the continued payments. If the
14-30 requested information has not been received by the retirement
14-31 system before the expiration of one year after the annuitant's
14-32 death, the retirement system shall suspend the annuity and close
14-33 the account until all requested information has been received by
14-34 the retirement system. After the retirement system receives the
14-35 requested information, it will resume making monthly payments of
14-36 the annuity and pay in a single sum all payments that were
14-37 suspended.
14-38 (i) The retirement system may apply a similar process as
14-39 provided by Subsection (a), (b), (c), (d), (e), or (f) to other
14-40 money it holds for payment, if the system first determines that no
14-41 claim for the money is likely to be filed.
14-42 Sec. 845.506. APPEAL OF ADMINISTRATIVE DECISION. A decision
14-43 of the board of trustees denying or limiting membership, service
14-44 credit, eligibility for or the amount of benefits payable by the
14-45 retirement system, or regarding to whom benefits should be paid is
14-46 a decision in a contested case as defined by the administrative
14-47 procedure law, Chapter 2001, and is subject to judicial review
14-48 under the substantial evidence rule in accordance with Sections
14-49 2001.174-2001.177.
14-50 Sec. 845.507. QUALIFICATION. It is intended that this
14-51 subtitle be construed and administered in a manner that the
14-52 retirement system will be considered qualified under Section 401(a)
14-53 of the Internal Revenue Code of 1986 (26 U.S.C. Section 401). The
14-54 board of trustees may adopt rules that it determines necessary for
14-55 the retirement system to be considered qualified. Rules adopted by
14-56 the board of trustees relating to qualification issues are
14-57 considered a part of the plan.
14-58 SECTION 33. The following provisions of the Government Code
14-59 are repealed:
14-60 (1) Section 842.202;
14-61 (2) Section 842.203;
14-62 (3) Section 843.303;
14-63 (4) Sections 844.003(d), (e), (f), and (g);
14-64 (5) Section 844.601;
14-65 (6) Section 844.602;
14-66 (7) Section 844.603;
14-67 (8) Section 844.604;
14-68 (9) Section 844.607(c);
14-69 (10) Section 845.111;
15-1 (11) Section 845.315(c);
15-2 (12) Section 845.401;
15-3 (13) Sections 845.402(d), (e), and (f);
15-4 (14) Section 845.503; and
15-5 (15) Section 845.504.
15-6 SECTION 34. This Act takes effect December 31, 1997, except
15-7 Section 21 and this section, which take effect September 1, 1997.
15-8 SECTION 35. The importance of this legislation and the
15-9 crowded condition of the calendars in both houses create an
15-10 emergency and an imperative public necessity that the
15-11 constitutional rule requiring bills to be read on three several
15-12 days in each house be suspended, and this rule is hereby suspended.
15-13 * * * * *