75R9530 ESH-D
By Greenberg, et al. H.B. No. 1780
Substitute the following for H.B. No. 1780:
By Telford C.S.H.B. No. 1780
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the purchase of service credit in the Employees
1-3 Retirement System of Texas and the Teacher Retirement System of
1-4 Texas.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 813.104, Government Code, is amended to
1-7 read as follows:
1-8 Sec. 813.104. ALTERNATIVE PAYMENTS TO ESTABLISH OR
1-9 REESTABLISH SERVICE CREDIT. (a) The board of trustees may adopt
1-10 rules to provide procedures for making installment payments to
1-11 establish or reestablish credit in the retirement system as
1-12 alternatives to lump-sum payments otherwise authorized or required
1-13 by this subtitle. The methods may include payment by payroll
1-14 deduction. [A member who is otherwise eligible may establish or
1-15 reestablish service creditable in the retirement system by making
1-16 payments as provided by this section in lieu of lump-sum payments
1-17 otherwise authorized or required by this subtitle.]
1-18 (b) [A payment authorized by this section consists of the
1-19 contribution required to establish or reestablish at least one year
1-20 of service credit, including any required interest and membership
1-21 fees, except that a person's last in a series of payments under
1-22 this section may be for a period of remaining service that is less
1-23 than one year.]
1-24 [(c) The retirement system shall grant the applicable amount
2-1 of service credit after each payment is made under this section.]
2-2 [(d)] Except as provided by Subsection (c) [Subsection (e)],
2-3 payments may not be made under a rule adopted under this section:
2-4 (1) to establish or reestablish service credit of a
2-5 person who has retired or died; or
2-6 (2) to establish current service under Section
2-7 813.201.
2-8 (c) Under a rule adopted under this section, the [(e) The]
2-9 designated beneficiary of a deceased member or, if none exists, the
2-10 personal representative of the decedent's estate may establish or
2-11 reestablish service for which the member was eligible at the time
2-12 of death if the establishment of the service would result in the
2-13 payment of a death benefit annuity or an increase in the amount of
2-14 a death benefit annuity.
2-15 (d) [(f)] The payment for the establishment or
2-16 reestablishment of service under Subsection (c) [Subsection (e)]
2-17 must be made in a lump sum and completed before the first payment
2-18 of a death benefit annuity, but not later than the 60th day after
2-19 the date the retirement system receives notice of the death.
2-20 [(g) The retirement system may adopt rules to administer
2-21 this section.]
2-22 SECTION 2. Section 813.106, Government Code, is amended to
2-23 read as follows:
2-24 Sec. 813.106. SERVICE NOT PREVIOUSLY ESTABLISHED. The state
2-25 shall make contributions for service not previously established
2-26 that is established under Section 813.104 [or 813.105] in the
2-27 amount provided by Section 813.202(e) for membership service or the
3-1 amount provided by Section 813.302(d) for military service, as
3-2 applicable. The state contributions will be made at the time the
3-3 service credit is granted.
3-4 SECTION 3. Section 813.510(d), Government Code, is amended
3-5 to read as follows:
3-6 (d) An election under this section must be filed with the
3-7 retirement system on a form provided by the system. Credit may be
3-8 established under this section by a lump-sum payment or by payments
3-9 authorized by Section 813.104 [or 813.105].
3-10 SECTION 4. Subchapter E, Chapter 825, Government Code, is
3-11 amended by adding Section 825.411 to read as follows:
3-12 Sec. 825.411. PAYROLL DEDUCTIONS FOR SERVICE CREDIT. (a) A
3-13 contributing member who is otherwise eligible may establish or
3-14 reestablish service creditable in the retirement system by making
3-15 payments as provided by this section in lieu of lump-sum payments
3-16 otherwise authorized or required by this subtitle or payments under
3-17 Section 825.410. Except as provided by Subsection (c), the
3-18 retirement system shall permit a member to purchase service credit
3-19 over a period of up to five years under an agreement under this
3-20 section.
3-21 (b) A payment authorized by this section consists of a
3-22 monthly payroll deduction in an amount not less than one-twelfth of
3-23 the contribution required to establish at least one year of service
3-24 credit, including any required interest and membership fee, except
3-25 as provided by Subsection (c).
3-26 (c) Payments to establish service credit by a member who
3-27 plans to retire in less than a year may be made by payroll
4-1 deduction for a period determined by the retirement system.
4-2 (d) Payroll deductions for payments under this section shall
4-3 be made and submitted to the retirement system at the times and in
4-4 the manner provided for member contributions under Section 825.403.
4-5 (e) The retirement system shall credit a member's payments
4-6 made under this section to a suspense account in the trust fund
4-7 until the sum of the payments equals the amount required for one
4-8 year of service credit, at which time the retirement system shall
4-9 deposit the payments in the appropriate accounts in the trust fund
4-10 and grant the applicable amount of service credit.
4-11 (f) A member who, while making payments under this section,
4-12 ceases to hold a position covered by the retirement system or
4-13 withdraws the authority for payroll deductions may:
4-14 (1) contract with the retirement system for an
4-15 alternative method of continuing the payments;
4-16 (2) receive a prorated amount of service based on the
4-17 payments made; or
4-18 (3) receive a refund of payments credited to the
4-19 suspense account and not transferred to a trust fund account.
4-20 (g) Payments may not be made under this section to establish
4-21 service credit of a person who has retired or died, except that a
4-22 beneficiary may make payment in a lump sum for the remainder of
4-23 service credit for which payments were begun before the member's
4-24 death.
4-25 (h) The retirement system may adopt rules to administer this
4-26 section.
4-27 SECTION 5. Section 813.105, Government Code, is repealed.
5-1 SECTION 6. This Act takes effect September 1, 1997.
5-2 SECTION 7. The importance of this legislation and the
5-3 crowded condition of the calendars in both houses create an
5-4 emergency and an imperative public necessity that the
5-5 constitutional rule requiring bills to be read on three several
5-6 days in each house be suspended, and this rule is hereby suspended.