By Armbrister S.B. No. 769
75R3089 GCH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to participation and credit in, contributions to, and
1-3 benefits and administration of the Texas County and District
1-4 Retirement System.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 841.001(1), Government Code, is amended
1-7 to read as follows:
1-8 (1) "Actuarial equivalent" means a benefit that, at
1-9 the time it is entered upon, has the same present value as the
1-10 benefit it replaces, based on seven percent annual interest and the
1-11 mortality table published by the Conference of Actuaries in Public
1-12 Practice and known as the UP-1984 table with an age setback of five
1-13 years for retired or disabled annuitants and an age setback of 10
1-14 years for beneficiaries, with a 30-percent reserve refund
1-15 assumption for the standard benefit [interest and on a mortality
1-16 table recommended by the actuary and adopted by the board of
1-17 trustees].
1-18 SECTION 2. Section 841.002, Government Code, is amended to
1-19 read as follows:
1-20 Sec. 841.002. PURPOSE OF SUBTITLE. The purpose of this
1-21 subtitle is to establish a program of benefits for members,
1-22 retirees, and their beneficiaries and to establish rules for the
1-23 management and operation of the retirement system. The assets of
1-24 the retirement system are held in trust for the exclusive benefit
2-1 of the members, the retirees, and their beneficiaries and may not
2-2 be diverted. Forfeitures may not be applied to increase the
2-3 benefits any person would otherwise receive under this subtitle.
2-4 SECTION 3. Subchapter A, Chapter 841, Government Code, is
2-5 amended by adding Sections 841.010 and 841.011 to read as follows:
2-6 Sec. 841.010. DISTRIBUTION REQUIREMENTS. Notwithstanding
2-7 any other provision of this subtitle, all distributions under this
2-8 subtitle must be determined and made in accordance with Section
2-9 401(a)(9) of the Internal Revenue Code of 1986 (26 U.S.C. Section
2-10 401), including the minimum incidental death benefit distribution
2-11 requirement of Section 401(a)(9)(G) of that code. The entire
2-12 vested interest of a participant must be distributed or begin to be
2-13 distributed not later than April 1 following the later of the year
2-14 in which the participant attains age 70-1/2 or the year in which
2-15 the participant separates from service with all participating
2-16 subdivisions. If the participant dies after distribution of the
2-17 participant's interest has begun, the remaining portion of the
2-18 interest will continue to be distributed at least as rapidly as the
2-19 method of distribution being used before the participant's death.
2-20 If the participant dies before distribution of the participant's
2-21 interest begins, distribution of the participant's entire interest
2-22 must be made in a manner complying with Section 401(a)(9)(B) of the
2-23 code.
2-24 Sec. 841.011. FULL VESTING OF ACCRUED BENEFITS AT
2-25 TERMINATION. If the retirement system is terminated or if there is
2-26 a complete discontinuance of contributions to the retirement
2-27 system, each member will become fully vested in that member's
3-1 accrued benefit to the extent funded as of the date of termination
3-2 or contribution discontinuance.
3-3 SECTION 4. Section 842.005(g), Government Code, is amended
3-4 to read as follows:
3-5 (g) If the participating subdivision continues in existence
3-6 or is succeeded by an organization, the annuities and credits
3-7 described by Subsection (e) may not be increased to a level that
3-8 exceeds the greater of the level in effect at the time Subsection
3-9 (e) became applicable or the level in effect on December 31, 1992.
3-10 [If the board of trustees determines, on the basis of computations
3-11 made by the actuary, that the available tangible assets are
3-12 materially in excess of the actuarial present value of benefits
3-13 described by Subsection (e), the board may direct that a portion of
3-14 the excess be paid to the subdivision or its successor.] When the
3-15 participating subdivision or its successor has no employees who are
3-16 members of the retirement system and has no present or potential
3-17 liabilities resulting from the participation of former employees,
3-18 the subdivision's participation in the retirement system ceases,
3-19 and the system shall repay to the subdivision or its successor the
3-20 amount in the subdivision accumulation fund that is credited to the
3-21 subdivision.
3-22 SECTION 5. Section 842.201(c), Government Code, is amended
3-23 to read as follows:
3-24 (c) A [Unless membership is waived, a] person who is made
3-25 eligible for membership in the retirement system under Subsection
3-26 (a) or (b) becomes a member on the date specified in the order of
3-27 the commissioners court.
4-1 SECTION 6. Subchapter C, Chapter 842, Government Code, is
4-2 amended by adding Section 842.204 to read as follows:
4-3 Sec. 842.204. REPEAL OF OPTION TO WAIVE OR RETURN TO
4-4 MEMBERSHIP. A person who, after December 31, 1997, is
4-5 participating in the retirement system or first becomes eligible to
4-6 participate in the retirement system under Section 842.201 may not
4-7 waive participation in the retirement system. A person who has
4-8 waived membership in the retirement system or elected not to make
4-9 contributions but who otherwise would be eligible to participate in
4-10 the retirement system under Section 842.201 is not permitted to
4-11 become a member or resume making contributions after December 31,
4-12 1997, under Section 842.201.
4-13 SECTION 7. Subchapter G, Chapter 843, Government Code, is
4-14 amended by adding Section 843.603 to read as follows:
4-15 Sec. 843.603. CURRENT SERVICE FOR REEMPLOYED VETERANS.
4-16 Notwithstanding any provision of this subtitle to the contrary,
4-17 contributions, benefits, and service credit with respect to
4-18 qualified military service will be provided in accordance with
4-19 Section 414(u) of the Internal Revenue Code of 1986 (26 U.S.C.
4-20 Section 414). The board of trustees may adopt rules that modify
4-21 the terms of this subtitle for the purpose of compliance with the
4-22 Uniformed Services Employment and Reemployment Rights Act of 1994
4-23 (38 U.S.C. Section 4301 et seq.).
4-24 SECTION 8. Sections 844.003(a) and (c), Government Code, are
4-25 amended to read as follows:
4-26 (a) Except as provided by Subsection [Subsections] (b) [and
4-27 (e)], the effective date of a member's service retirement is the
5-1 date the member designates at the time the member applies for
5-2 retirement under Section 844.101, but the date must be the last day
5-3 of a calendar month and may not precede the date the member
5-4 terminates employment with all participating subdivisions.
5-5 (c) Except as provided by Subsection [Subsections] (b) [and
5-6 (e)], the effective date of a member's disability retirement is the
5-7 date designated on the application for retirement filed by or for
5-8 the member as provided by Section 844.301, but the date may not
5-9 precede the date the member terminates employment with all
5-10 participating subdivisions.
5-11 SECTION 9. Section 844.008, Government Code, is amended to
5-12 read as follows:
5-13 Sec. 844.008. LIMITATION ON PAYMENT OF BENEFITS. (a)
5-14 Notwithstanding any other provision of this subtitle, the benefit
5-15 payable to a retiree of the retirement system may not exceed the
5-16 maximum benefit permitted under Section 415(b) of the Internal
5-17 Revenue Code of 1986 (26 U.S.C. Section 415(b)) as adjusted in
5-18 accordance with Section 415(d) of that code. Any adjustments are
5-19 applicable to the postretirement benefits of retirees as well as to
5-20 the benefits of retiring members. For the purpose of determining
5-21 whether the benefit of a retiring member or retiree exceeds the
5-22 limitations provided in this section, all defined benefit plans of
5-23 the employer and of entities required to be aggregated with the
5-24 employer for purposes of Section 415 of the Internal Revenue Code
5-25 of 1986 are to be treated as one defined benefit plan and all
5-26 defined contribution plans of the employer and of entities required
5-27 to be aggregated with the employer for purposes of Section 415 of
6-1 that code are to be treated as one defined contribution plan. The
6-2 limitation year for determining maximum benefits is the calendar
6-3 year. [In this section:]
6-4 [(1) "Annual benefit" means the total of all annuity
6-5 payments by the retirement system on behalf of a person who has
6-6 retired under this subtitle during a calendar year, including any
6-7 distributive benefit payments.]
6-8 [(2) "Compensation" has the meaning assigned by
6-9 Section 415, Internal Revenue Code, and the regulations adopted
6-10 under that section, not to exceed the limitations provided by
6-11 Section 401(a)(17) of that code, instead of the meaning assigned by
6-12 Section 841.001.]
6-13 [(3) "Highest average annual compensation" means the
6-14 average compensation for the three consecutive calendar years of
6-15 service that produces the highest average.]
6-16 [(4) "Internal Revenue Code" means the Internal
6-17 Revenue Code of 1986 (Title 26, United States Code).]
6-18 [(b) If the amount of any benefit payment under this
6-19 subtitle would exceed the limitations provided by this section, the
6-20 retirement system shall reduce the amount of the benefit in
6-21 accordance with this section.]
6-22 [(c) Except as otherwise provided by this section, a benefit
6-23 is adjusted to an actuarially equivalent straight life annuity for
6-24 the purpose of determining limitations under this section. An
6-25 actuarial adjustment to a benefit is not required for the value of
6-26 a qualified joint and survivor annuity and the value of
6-27 postretirement cost-of-living increases made in accordance with
7-1 Section 415, Internal Revenue Code.]
7-2 [(d) Except as provided by Subsections (f), (h), and (i), an
7-3 annual benefit payable by the retirement system may not exceed the
7-4 lesser of:]
7-5 [(1) $112,221, or another amount as adjusted each
7-6 January 1 by the secretary of the treasury under Section 415 of the
7-7 Internal Revenue Code of 1986 (26 U.S.C. Section 415) for
7-8 cost-of-living increases after January 1, 1992; or]
7-9 [(2) 100 percent of the former member's highest
7-10 average annual compensation, including annual cost-of-living
7-11 increases after separation from service.]
7-12 [(e) If payment of a benefit begins before a member attains
7-13 age 62, the dollar limitation is the actuarial equivalent of an
7-14 annual benefit beginning at age 62 as described by Subsection
7-15 (d)(1) for a person at age 62. A reduction under this subsection
7-16 may not reduce the dollar limitation below $75,000 if the benefit
7-17 begins at or after age 55 or, if the benefit begins before age 55,
7-18 the actuarial equivalent of a $75,000 limitation beginning at age
7-19 55.]
7-20 [(f) If payment of a benefit begins after the member attains
7-21 age 65, the dollar limitation is the actuarial equivalent of an
7-22 annual benefit beginning at age 65 as described by Subsection
7-23 (d)(1).]
7-24 [(g) To determine actuarial equivalence, the interest rate
7-25 assumption under Subsection (c) or (e) is the greater of the rate
7-26 specified by Section 845.314(a) or five percent, and the interest
7-27 rate assumption under Subsection (f) is the lesser of those rates.]
8-1 [(h) The limitations provided by Subsections (d), (e), and
8-2 (f) do not apply to any portion of an annual benefit payable by the
8-3 retirement system that is paid from the balance in the member's
8-4 individual account in the employees saving fund as of December 31,
8-5 1985, or from interest credited to the member's account after
8-6 December 31, 1985, as a result of deposits before that date.]
8-7 [(i) This section may not be applied to reduce the annual
8-8 benefit payable to any person who retired under the retirement
8-9 system before January 1, 1994, or to reduce the vested accrued
8-10 benefit as of December 31, 1993, of any person who was a member of
8-11 the retirement system on that date.]
8-12 [(j) If the Internal Revenue Code is amended in such a
8-13 manner that limitations similar to those provided by this section
8-14 are not required of governmental retirement plans to constitute
8-15 qualified plans, the board of trustees may by rule eliminate all or
8-16 any portion of the limitations provided by this section.]
8-17 (b) [(k)] An employer may not provide employee retirement or
8-18 deferred benefits under a plan other than the retirement system to
8-19 the extent that the provision of the benefits, when considered
8-20 together with the benefits provided under the retirement system
8-21 [authorized by this subtitle as required by the Internal Revenue
8-22 Code], would result in the failure of the retirement system
8-23 [system's plan] to meet any of the limitation requirements of
8-24 Section 415 of the Internal Revenue Code of 1986 (26 U.S.C.
8-25 Section 415), and the benefits of the other plan will automatically
8-26 be reduced, eliminated, or adjusted to the extent necessary to
8-27 prevent the failure [federal qualification standards as applied to
9-1 governmental retirement plans].
9-2 [(l) The annual benefit payable by the retirement system
9-3 that is otherwise limited by Subsection (d) may be increased each
9-4 year in accordance with cost-of-living adjustments by the secretary
9-5 of the treasury of the dollar limitation or the compensation
9-6 limitation as long as it does not exceed the amount that would be
9-7 payable without limitation of Section 415 of the Internal Revenue
9-8 Code of 1986 (26 U.S.C. Section 415).]
9-9 [(m) The limitations provided by this section may not be
9-10 applied to reduce the benefit of any person whose retirement
9-11 benefits under this and all other defined benefit plans of the
9-12 member's employer do not exceed $10,000, plus the benefit provided
9-13 by Subsection (h), for the plan year or for any previous plan year
9-14 and who has not at any time participated in a defined contribution
9-15 plan maintained by the person's employer.]
9-16 SECTION 10. Section 844.209, Government Code, is amended by
9-17 adding Subsection (g) to read as follows:
9-18 (g) If a member to whom Subsection (b) otherwise would be
9-19 applicable dies without having a valid beneficiary designation on
9-20 file with the retirement system, the member's estate will be
9-21 considered to be the designated beneficiary if the member died
9-22 before becoming eligible to make a selection under Section 844.105,
9-23 844.106, 844.207, or 844.210. The executor or administrator of the
9-24 estate or, if there is no executor or administrator, the persons
9-25 entitled to receive the member's estate may elect to receive, in
9-26 lieu of the accumulated deposits, the optional benefit described by
9-27 Section 844.104(c)(4). The election may be made only by filing
10-1 written notice with the board of trustees together with either a
10-2 certified copy of the court order or an affidavit meeting the
10-3 requirements of Section 137 of the Texas Probate Code. An election
10-4 by those persons may be made only if all of the persons entitled to
10-5 the member's accumulated contributions agree in writing on the
10-6 selection of the option.
10-7 SECTION 11. Section 844.401(a), Government Code, is amended
10-8 to read as follows:
10-9 (a) Except as provided by Subsection (c), if a member dies
10-10 before retirement, a lump-sum death benefit is payable from the
10-11 employees saving fund in the amount of:
10-12 (1) the accumulated contributions in the member's
10-13 individual account in the fund; plus
10-14 (2) interest computed from the beginning of the year
10-15 in which death occurs through the end of the month before the month
10-16 in which death occurs on the balance in the member's individual
10-17 account in the employees saving fund on January 1 of the year in
10-18 which the member's death occurs [at the rate allowed on member
10-19 contributions during the preceding year].
10-20 SECTION 12. Sections 844.605(a) and (c), Government Code,
10-21 are amended to read as follows:
10-22 (a) If the actuary determines that the obligations of a
10-23 participating subdivision to the subdivision accumulation fund
10-24 cannot be amortized within a period of 40 years or determines that
10-25 subdivision contributions at the rate in accordance with Section
10-26 845.404(a)(2) and any supplemental contribution rate adopted by the
10-27 subdivision under this section are inadequate to fund all
11-1 obligations charged against the subdivision's account in the
11-2 subdivision accumulation fund, the governing body of the
11-3 subdivision may by order or resolution provide additional
11-4 contributions by adopting a supplemental contribution rate under
11-5 this section to reduce the funding period. [A supplemental
11-6 contribution rate adopted under this section also may be authorized
11-7 by the governing body of a subdivision for the purpose of restoring
11-8 the level of benefits in effect for that subdivision that existed
11-9 on January 1, 1994.]
11-10 (c) A supplemental contribution rate adopted by a
11-11 participating subdivision may not be increased unless the actuary
11-12 subsequently makes the determination described by Subsection (a)
11-13 [determines that the rate previously adopted, together with the
11-14 contributions provided under Section 845.404(a)(2), will not
11-15 amortize the obligations of the subdivision to the subdivision
11-16 accumulation fund within a period of 40 years after the actuarial
11-17 study date]. If the actuary makes the determination specified by
11-18 this subsection, the governing body of the subdivision may adopt
11-19 another supplemental contribution rate under this section.
11-20 SECTION 13. The heading of Section 844.606, Government Code,
11-21 is amended to read as follows:
11-22 Sec. 844.606. [ADDITIONAL] OPTIONAL DECREASE IN CREDITS.
11-23 SECTION 14. Section 844.606(a), Government Code, is amended
11-24 to read as follows:
11-25 (a) If the actuary has made the determination described by
11-26 Section 844.605(a) [determines that the obligations of a
11-27 participating subdivision to the subdivision accumulation fund
12-1 cannot be amortized within a period of 40 years], the governing
12-2 body of the subdivision may by order or resolution reduce multiple
12-3 matching credits for contributions made after the effective date of
12-4 the reduction.
12-5 SECTION 15. Sections 844.607(a) and (b), Government Code,
12-6 are amended to read as follows:
12-7 (a) If the actuary has made the determination described by
12-8 Section 844.605(a)[, provided for by Section 844.601(b), that a
12-9 subdivision's contributions are inadequate to fund all obligations
12-10 charged against its account in the subdivision accumulation fund]
12-11 and has made the determination, provided for by Section 844.606(b),
12-12 of the lower percentage to be used for multiple matching credits of
12-13 future member contributions that is necessary to make the financing
12-14 arrangement adequate, the actuary shall give written notice of the
12-15 determinations to the director, who shall give written notice to
12-16 the governing body of the subdivision.
12-17 (b) If the governing body of the subdivision does not adopt
12-18 an order or resolution that is approved by the board of trustees,
12-19 authorizing additional subdivision contributions under Section
12-20 844.605, authorizing a reduction in multiple matching credits under
12-21 Section 844.606, or authorizing both additional contributions and a
12-22 reduction in multiple matching credits, and that takes effect
12-23 [described by Subsection (c) effective] on the first day of the
12-24 first calendar year that begins at least 90 days after the date of
12-25 the notice under Subsection (a), the lower percentage to be used
12-26 for multiple matching credits on future member contributions as
12-27 contained in the notice to the governing body becomes effective as
13-1 to all members who perform current service for the affected
13-2 subdivision on or after the first day of that calendar year
13-3 [actuary shall make new determinations, provided for by Sections
13-4 844.601(b) and 844.606(b), based on the most recent actuarial
13-5 valuation. The actuary shall give written notice of these
13-6 determinations to the director, who shall give a second written
13-7 notice to the governing body of the subdivision].
13-8 SECTION 16. Section 844.608(b), Government Code, is amended
13-9 to read as follows:
13-10 (b) If the actuary determines that, despite all required
13-11 decreases described by Section 844.607, the obligations of a
13-12 participating subdivision to the subdivision accumulation fund
13-13 cannot be amortized within a period of 25 [40] years, the
13-14 retirement system shall reduce the rate of member contributions to
13-15 such lower rate authorized by this section as, in the opinion of
13-16 the actuary, is required for the obligations of the subdivision to
13-17 the subdivision accumulation fund to be able to be amortized within
13-18 a period of 25 [40] years. At the time the actuary determines that
13-19 the rate of employee contributions no longer must be reduced for
13-20 the obligations to be able to be amortized within 25 [40] years,
13-21 the retirement system shall reinstate the employee contribution
13-22 rate to the rate that was in effect at the time of the reduction,
13-23 unless the governing body of the subdivision has elected to change
13-24 to some other rate authorized by Section 845.402. Any change under
13-25 this section shall be made on January 1 of the year following the
13-26 applicable determination by the actuary.
13-27 SECTION 17. Sections 844.703(b), (c), (d), and (f),
14-1 Government Code, are amended to read as follows:
14-2 (b) Each subdivision adopting the plan provisions of this
14-3 subchapter shall pay to the subdivision accumulation fund, as its
14-4 prior service contribution, an amount equal to a percentage of the
14-5 compensation of members employed by the subdivision for that month.
14-6 The rate of contribution is the rate determined annually by the
14-7 actuary and approved by the board of trustees as being the rate
14-8 required to fund all unfunded obligations charged against the
14-9 subdivision's account in the subdivision accumulation fund within
14-10 the subdivision's amortization period without probable future
14-11 depletion of that account or, if there are no unfunded obligations,
14-12 the rate required to amortize any overfunded obligations within a
14-13 period of 30 years [in perpetuity].
14-14 (c) The combined rates of a subdivision's normal
14-15 contributions and prior service contributions under this subchapter
14-16 may not exceed 11 percent [the rate determined as the employee
14-17 contribution rate plus three percent, except that the governing
14-18 body of the subdivision may elect to increase the maximum combined
14-19 rate to not more than the rate determined as the employee rate plus
14-20 four percent, if necessary in order to maintain the current level
14-21 of benefits or to restore the level of benefits in effect on
14-22 January 1, 1994. A reduction of the member contribution rate for
14-23 employees of the subdivision does not reduce the maximum rate of
14-24 contribution of the subdivision].
14-25 (d) The actuary annually shall determine the subdivision
14-26 normal contribution rate and the prior service contribution rate
14-27 for subdivisions adopting the plan provisions of this subchapter
15-1 from the most recent data available at the time of determination.
15-2 Before January 1 of each year, the board of trustees shall certify
15-3 the rates of each subdivision that has adopted the plan provisions
15-4 of this subchapter. If the combined rates of the subdivision's
15-5 normal contributions and prior service contributions under this
15-6 subchapter exceed the rate prescribed by Subsection (c), the rate
15-7 for prior service contributions must be reduced to the rate that
15-8 equals the difference between the maximum rate prescribed by
15-9 Subsection (c) and the normal contribution rate. The governing
15-10 body may elect to contribute at a rate that is an integer percent
15-11 but not more than the maximum rate prescribed by Subsection (c) if
15-12 that rate exceeds the sum of the subdivision's normal contribution
15-13 rate and its prior service contribution rate as determined under
15-14 Subsections (a) and (b). This elected rate remains in effect for
15-15 each subsequent calendar year until it is rescinded by the
15-16 governing body or until the sum of the rates determined under
15-17 Subsections (a) and (b) exceeds the elected rate, at which time the
15-18 governing body must contribute the sum of the rates determined
15-19 under Subsections (a) and (b). For years in which the elected
15-20 rate exceeds the sum of the rates determined under Subsections (a)
15-21 and (b), the prior service contribution rate is increased to the
15-22 rate that equals the difference between the elected rate and the
15-23 normal contribution rate prescribed by Subsection (a). [If for any
15-24 year the combined rates of a subdivision's normal contribution rate
15-25 and its prior service contribution rate as determined under
15-26 Subsections (a) and (b) are less than the subdivision's employee
15-27 contribution rate, the governing body of the subdivision may elect
16-1 that the subdivision make normal contributions and prior service
16-2 contributions for that year at a combined rate equal to the
16-3 employee contribution rate for that year.]
16-4 (f) The prior service contribution rate prescribed by
16-5 Subsection (b) must be based on an open or closed amortization
16-6 period as recommended by the actuary and adopted by the board of
16-7 trustees but may not exceed 30 years. The board of trustees may
16-8 establish criteria for the circumstances under which a
16-9 subdivision's amortization period, if closed, will be renewed,
16-10 extended, or shortened. [The governing body of the subdivision has
16-11 25 years beginning with the effective date of the plan provisions
16-12 of this subchapter to amortize all unfunded obligations against the
16-13 subdivision's account in the subdivision accumulation fund. The
16-14 adoption of any of the following benefit increases after the
16-15 effective date of the plan provisions will result in a new
16-16 amortization period of 25 years beginning with the effective date
16-17 of the benefit increases:]
16-18 [(1) an increase in the percentage used in determining
16-19 multiple matching credits under Section 844.704(a);]
16-20 [(2) an increase in the percentage used in determining
16-21 allocated prior service credits under Section 844.704(b);]
16-22 [(3) the optional increase in retirement annuities
16-23 under Section 844.208;]
16-24 [(4) the optional benefit for a surviving beneficiary
16-25 of a member described by Section 844.209;]
16-26 [(5) the optional benefit eligibility plan described
16-27 by Section 844.210;]
17-1 [(6) the optional benefit eligibility plan described
17-2 by Section 844.211;]
17-3 [(7) the optional authorization of the reestablishment
17-4 of credited service previously forfeited under Section 843.003; or]
17-5 [(8) the optional election to have credits recomputed
17-6 on the basis of total compensation under Section 843.702.]
17-7 SECTION 18. Section 845.108, Government Code, is amended to
17-8 read as follows:
17-9 Sec. 845.108. DESIGNATION OF AUTHORITY TO DISBURSE FUNDS
17-10 [SIGN VOUCHERS]. The director is authorized to sign checks and
17-11 authorize fund transfers [board of trustees by resolution shall
17-12 designate one or more representatives who have authority to sign
17-13 vouchers] for payments from the assets of the retirement system.
17-14 The director may designate in writing additional persons to have
17-15 authority to sign checks and authorize fund transfers for payments
17-16 from the assets of the retirement system.
17-17 SECTION 19. Section 845.202(d), Government Code, is amended
17-18 to read as follows:
17-19 (d) The director annually shall:
17-20 (1) prepare an itemized budget showing the amount
17-21 required to pay the retirement system's administrative expenses for
17-22 the following fiscal year; and
17-23 (2) submit the administrative budget [report] to the
17-24 board for review, amendment, and adoption.
17-25 SECTION 20. Section 845.206(d), Government Code, is amended
17-26 to read as follows:
17-27 (d) On the basis of tables and rates adopted by the board,
18-1 the actuary shall[:]
18-2 [(1) compute the current interest rate in accordance
18-3 with Section 845.314; and]
18-4 [(2)] make an annual valuation of the assets and
18-5 liabilities of the [funds of the] retirement system and of each
18-6 participating subdivision with regard to the retirement system.
18-7 SECTION 21. Section 845.301, Government Code, is amended by
18-8 amending Subsections (a) and (b) and adding Subsection (f) to read
18-9 as follows:
18-10 (a) The assets of the retirement system shall be invested
18-11 and reinvested without distinction as to their source in accordance
18-12 with Section 67, Article XVI, Texas Constitution. Investment and
18-13 management decisions concerning individual investments must be
18-14 evaluated not in isolation but in the context of the investment
18-15 portfolio as a whole and as part of an overall investment strategy
18-16 consistent with the investment objectives of the retirement system.
18-17 [The board of trustees shall invest and reinvest the assets of the
18-18 retirement system without distinction as to their source in:]
18-19 [(1) interest-bearing bonds or other evidences of
18-20 indebtedness of this state, a county, school district, city, or
18-21 other municipal corporation of this state, the United States, or an
18-22 authority or an agency of the United States;]
18-23 [(2) securities for which the United States or any
18-24 authority or agency of the United States guarantees the payment of
18-25 principal and interest;]
18-26 [(3) interest-bearing bonds, notes, or other evidences
18-27 of indebtedness that are issued by a company:]
19-1 [(A) incorporated in the United States and that
19-2 are rated "A" or better by one or more nationally recognized rating
19-3 agencies approved by the board; or]
19-4 [(B) in whose stock the retirement system may
19-5 invest as provided by Subdivision (4);]
19-6 [(4) common or preferred stocks of a company
19-7 incorporated in the United States that, unless the stocks are bank
19-8 or insurance stocks, is listed on an exchange registered with the
19-9 Securities and Exchange Commission or its successor;]
19-10 [(5) obligations issued, assumed, or guaranteed by the
19-11 Inter-American Development Bank, the International Bank for
19-12 Reconstruction and Development (the World Bank), the African
19-13 Development Bank, the Asian Development Bank, and the International
19-14 Finance Corporation;]
19-15 [(6) real estate mortgage investment conduit
19-16 securities (REMICs) or other participation certificates issued by
19-17 the Federal National Mortgage Corporation or by the Federal Home
19-18 Loan Mortgage Corporation, evidencing an undivided beneficial
19-19 interest in pools of real estate mortgage notes that are guaranteed
19-20 as to payment of principal and interest by the issuer, or by any
19-21 agency, authority, or instrumentality of the United States, and
19-22 that are to be held in trust by the issuer for the benefit of the
19-23 certificate holder; or]
19-24 [(7) bonds issued, assumed, or guaranteed by the state
19-25 of Israel.]
19-26 (b) The board of trustees shall exercise control of the
19-27 investment operations by employing an investment officer, who shall
20-1 supervise the investment operations for the board of trustees. The
20-2 investment officer shall prepare and submit to the board for
20-3 review, amendment, and adoption an itemized budget showing the
20-4 amount required to pay the investment expenses of the retirement
20-5 system for the following fiscal year.
20-6 (f) The board of trustees shall establish written investment
20-7 objectives concerning the investment of assets of the retirement
20-8 system.
20-9 SECTION 22. Section 845.305, Government Code, is amended to
20-10 read as follows:
20-11 Sec. 845.305. CREDITING SYSTEM ASSETS. (a) The retirement
20-12 system shall immediately deposit all money received by the system
20-13 with a depository designated under Section 845.109 or a custodian
20-14 designated under Section 845.302.
20-15 (b) [When securities of the retirement system are received,
20-16 the system shall deposit the securities in trust with a depository
20-17 designated under Section 845.109. The depository shall provide
20-18 adequate safe deposit facilities for the preservation of the
20-19 securities.]
20-20 [(c)] All assets of the retirement system shall be credited
20-21 according to the purpose for which they are held to one of the
20-22 following funds:
20-23 (1) employees saving fund;
20-24 (2) subdivision accumulation fund;
20-25 (3) current service annuity reserve fund;
20-26 (4) interest fund;
20-27 (5) endowment fund;
21-1 (6) expense fund; or
21-2 (7) supplemental death benefits fund.
21-3 SECTION 23. Section 845.307(a), Government Code, is amended
21-4 to read as follows:
21-5 (a) The retirement system shall deposit in the account of a
21-6 participating subdivision in the subdivision accumulation fund:
21-7 (1) all benefit contributions made by the subdivision
21-8 to the system pursuant to Section 845.404(a)(2);
21-9 (2) income and interest allocated to [interest allowed
21-10 on money in] the fund as provided by this subtitle;
21-11 (3) amounts deposited by the subdivision in accordance
21-12 with former Section 845.405 to establish credited service during a
21-13 time of war;
21-14 (4) the withdrawal charge for reinstatement of
21-15 credited service as provided by Section 843.003 or 843.404;
21-16 (5) the amount of matching contributions made by a
21-17 subdivision in accordance with Section 843.301(c) or 843.402(c) to
21-18 establish credit for prior or current service for a person who
21-19 became a member in accordance with Subchapter C of Chapter 842;
21-20 (6) the amount of matching contributions made by a
21-21 subdivision in accordance with Section 843.601(f) to establish
21-22 current service credit for military service;
21-23 (7) the amount of matching contributions made by a
21-24 subdivision in accordance with Section 843.501 to establish credit
21-25 for legislative service; and
21-26 (8) the amount deposited by a subdivision for a person
21-27 to become a member in accordance with Section 842.103.
22-1 SECTION 24. Section 845.309, Government Code, is amended to
22-2 read as follows:
22-3 Sec. 845.309. INTEREST FUND. (a) The [retirement system
22-4 shall deposit in the] interest fund must contain accounts for:
22-5 (1) distributable income;
22-6 (2) non-distributable income;
22-7 (3) investment expenses; and
22-8 (4) other accounts the board of trustees establishes
22-9 by resolution [all income, interest, and dividends from deposits
22-10 and investments authorized by this subtitle].
22-11 (b) On December 31 of each year, the non-distributable
22-12 income account will be adjusted by the net change in carrying value
22-13 necessary to value at market all domestic, fixed-income securities
22-14 owned by the retirement system as part of a passively managed,
22-15 long-term portfolio [system shall transfer money from the interest
22-16 fund in accordance with Section 845.315].
22-17 (c) The distributable income account will be credited with:
22-18 (1) all income, interest, and dividends from deposits
22-19 and investments of the retirement system;
22-20 (2) all changes in carrying value of the investments
22-21 described by Subsection (b) resulting from amortization, accretion,
22-22 accrual of interest payments as principal, or other change in
22-23 carrying value not resulting from a change in market value;
22-24 (3) all net capital gains and losses resulting from
22-25 the sale, call, maturity, or conversion of investments of the
22-26 retirement system;
22-27 (4) all changes in carrying values of investments of
23-1 the retirement system except those to be credited in accordance
23-2 with Subsection (b); and
23-3 (5) any amounts that the board of trustees transfers
23-4 under Section 845.310(e).
23-5 (d) The investment expenses account will be charged with the
23-6 costs attributable to the management, selection, acquisition,
23-7 maintenance, oversight, and disposal of all investments of the
23-8 retirement system.
23-9 (e) On December 31 of each year, the amount remaining in the
23-10 distributable income account and the investment expenses account
23-11 shall be distributed in the manner prescribed by this subtitle.
23-12 SECTION 25. Sections 845.310(b), (c), and (e), Government
23-13 Code, are amended to read as follows:
23-14 (b) The endowment fund consists of:
23-15 (1) the general reserves account;
23-16 (2) [the distributive benefits account;]
23-17 [(3)] the perpetual endowment account; and
23-18 (3) [(4)] other special accounts that the board of
23-19 trustees by resolution establishes.
23-20 (c) The system shall credit to the general reserves account
23-21 income allocated to the endowment fund [and to the distributive
23-22 benefits account interest] in accordance with Section 845.315.
23-23 (e) If the board of trustees determines that the amount in
23-24 the general reserves account as of December 31 of any year is in
23-25 excess of the amount necessary to provide adequate funding and
23-26 reserves for all needs and contingencies, the board may by
23-27 resolution transfer part or all of the excess to the distributable
24-1 income account of the interest fund for distribution. [credited to
24-2 the distributive benefits account on December 31 of any year is
24-3 sufficient to do so, the board by resolution may:]
24-4 [(1) authorize the distribution to the subdivision
24-5 accumulation fund of all or part of the amount that is credited to
24-6 the account and that is equal to the amount in the subdivision
24-7 accumulation fund on January 1 of the year multiplied by:]
24-8 [(A) two percent or more when the current
24-9 interest rate is equal to the rate prescribed by Section
24-10 845.314(a); or]
24-11 [(B) two percent when the current interest rate
24-12 is less than the rate prescribed by Section 845.314(a);]
24-13 [(2) authorize the distribution and payment of all or
24-14 part of the money credited to the account to persons who were
24-15 annuitants on that day in the ratio that the monthly benefit of
24-16 each annuitant would bear if not reduced under Section 844.008 to
24-17 the total of all annuity payments that would have been made by the
24-18 system, if not reduced under Section 844.008, for the final month
24-19 of the year; or]
24-20 [(3) authorize the distribution of all or part of the
24-21 amount credited to the account to:]
24-22 [(A) each member's individual account in the
24-23 employees saving fund as supplemental interest in the ratio of the
24-24 amount of current interest paid on the individual's account to the
24-25 current interest paid to all individual accounts for the year; and]
24-26 [(B) each participating subdivision's account in
24-27 the subdivision accumulation fund as supplemental interest in the
25-1 ratio of the current interest allowed on the account of the
25-2 subdivision to the total current interest paid to all subdivisions'
25-3 accounts for the year.]
25-4 SECTION 26. Section 845.311, Government Code, is amended to
25-5 read as follows:
25-6 Sec. 845.311. EXPENSE FUND. (a) [The board of trustees
25-7 shall deposit in the expense fund:]
25-8 [(1) membership fees paid in accordance with Section
25-9 845.401; and]
25-10 [(2) subdivision contributions for expenses of the
25-11 retirement system paid in accordance with Section 845.404.]
25-12 [(b)] The board of trustees by resolution recorded in its
25-13 minutes shall transfer from the general reserves account of the
25-14 endowment fund to the expense fund the amount [that exceeds the
25-15 amount needed to provide adequate reserves against insufficient
25-16 earnings on investments and against special and contingency
25-17 requirements of other funds of the system and] that is needed to
25-18 pay the system's estimated cash outlays for administrative and
25-19 investment expenses for the next fiscal year.
25-20 (b) [(c)] The retirement system shall pay from the expense
25-21 fund:
25-22 (1) administrative and maintenance expenses of the
25-23 system; [and]
25-24 (2) notes and bonds issued in accordance with Section
25-25 845.105; and
25-26 (3) investment expenses of the system.
25-27 [(d) If the amount of the system's estimated expenses
26-1 exceeds the amount in the general reserves account available for
26-2 administrative expenses, the board of trustees, by a resolution
26-3 recorded in its minutes, shall require an amount equal to the
26-4 difference from participating subdivisions and members. The board
26-5 shall collect the required amount and deposit the amount collected
26-6 in the expense fund.]
26-7 SECTION 27. Section 845.313, Government Code, is amended to
26-8 read as follows:
26-9 Sec. 845.313. DISBURSEMENTS. (a) Disbursements from the
26-10 assets of the retirement system may be made by check, electronic
26-11 funds transfer, or any other means generally available within the
26-12 banking industry and must be [only on vouchers] signed or otherwise
26-13 authorized by a [by the] person designated for that purpose in
26-14 accordance with Section 845.108.
26-15 (b) [A person designated to sign vouchers may draw checks or
26-16 warrants only on proper authorization from the board of trustees,
26-17 recorded in the official minutes of the meetings of the board.]
26-18 [(c)] When a check or fund transfer [voucher] is properly
26-19 signed or otherwise authorized, a depository with which assets of
26-20 the system are deposited shall accept and pay the check or complete
26-21 the fund transfer [voucher]. The depository is released from
26-22 liability for payment made on the check or authorized fund
26-23 transfer [voucher].
26-24 SECTION 28. Section 845.314(c), Government Code, is amended
26-25 to read as follows:
26-26 (c) The current interest rate is seven percent for calendar
26-27 years after December 31, 1996. [the lesser of:]
27-1 [(1) the interest rate prescribed by Subsection (a);
27-2 or]
27-3 [(2) the interest rate computed by:]
27-4 [(A) adding the mean amounts in the current
27-5 service annuity reserve fund and the supplemental death benefits
27-6 fund during the year and multiplying the sum by the rate prescribed
27-7 by Subsection (a);]
27-8 [(B) multiplying the amount in the subdivision
27-9 accumulation fund on January 1 of the year by two percent;]
27-10 [(C) subtracting the sum of the amount computed
27-11 under Paragraphs (A) and (B), plus an amount equal to the sum of
27-12 all interest credited during the year to the employees saving fund
27-13 accounts of members as provided by Section 844.007(b) and to the
27-14 subdivision accumulation fund as provided by Section 844.007(c),
27-15 plus an amount equal to the amount to be transferred to the expense
27-16 fund for administrative expenditures of the retirement system for
27-17 the following year, from an amount equal to the amount in the
27-18 interest fund on December 31 of the year, before transfers of
27-19 interest to other funds are made;]
27-20 [(D) adding an amount equal to the amount in the
27-21 endowment fund on January 1 of the year, an amount equal to the
27-22 amount in the subdivision accumulation fund on January 1 of the
27-23 year, and an amount equal to the sum of the accumulated deposits in
27-24 the employees saving fund on January 1 of the year of all persons
27-25 who are members on December 31 of the year, before any transfers
27-26 for retirements effective December 31 are made; and]
27-27 [(E) dividing the amount computed under
28-1 Paragraph (C) by the amount computed under Paragraph (D) and
28-2 expressing the result to the nearest one-tenth of one percent.]
28-3 SECTION 29. Sections 845.315(a) and (b), Government Code,
28-4 are amended to read as follows:
28-5 (a) On December 31 of each year and after the balance of the
28-6 investment expenses account has been transferred to the
28-7 distributable income account, the board of trustees shall transfer
28-8 from the distributable income account of the interest fund the
28-9 following amounts:
28-10 (1) to the current service annuity reserve fund,
28-11 interest on the mean amount in the current service annuity reserve
28-12 fund during that year;
28-13 (2) to the supplemental death benefits fund, interest
28-14 on the mean amount in the supplemental death benefits fund during
28-15 [subdivision accumulation fund, current interest on the amount in
28-16 the subdivision accumulation fund on January 1 of] that year;
28-17 (3) to the general reserves account of the endowment
28-18 fund, a dollar amount determined by the board of trustees as
28-19 necessary to provide adequate funding of the endowment fund,
28-20 including provisions for all special needs, all contingencies,
28-21 replenishment of the amount transferred during the current year to
28-22 the employees saving fund for interest to retiring or deceased
28-23 members plus the matching amount transferred to the subdivision
28-24 accumulation fund, and funding of investment expenses and
28-25 administrative costs for the following [current interest on the
28-26 amount in the endowment fund on January 1 of that] year;
28-27 (4) to the employees saving fund, current interest on
29-1 the sum of the accumulated deposits in the employees saving fund
29-2 credited on January 1 of that year to all persons who are members
29-3 on December 31 of that year before any transfers for retirement
29-4 effective December 31 of that year are made; and
29-5 (5) to the subdivision accumulation fund, the
29-6 remaining balance of the distributable income account in the
29-7 interest fund after transfers provided for by Subdivisions (1),
29-8 (2), (3), and (4) have been made [supplemental death benefits fund,
29-9 interest on the mean amount in the supplemental death benefits fund
29-10 during that year].
29-11 (b) The account of each subdivision, other than a
29-12 subdivision that has ceased participation, will receive a share of
29-13 the amount transferred under Subsection (a)(5) that is in
29-14 proportion to the amount that the balance credited to its account
29-15 on January 1 bears to the total credited to the subdivision
29-16 accumulation fund on that date. [The board of trustees shall
29-17 transfer to the general reserves account of the endowment fund the
29-18 portion of the amount remaining in the interest fund after the
29-19 transfers required by Subsection (a) are made that the board of
29-20 trustees determines is necessary:]
29-21 [(1) to provide adequate reserves against insufficient
29-22 future earnings on investments to allow interest on the system's
29-23 funds;]
29-24 [(2) to provide adequate reserves against special and
29-25 contingency requirements of other funds of the system; and]
29-26 [(3) to provide the amount required for the
29-27 administrative expenses of the system for the following year.]
30-1 SECTION 30. Sections 845.402(b) and (c), Government Code,
30-2 are amended to read as follows:
30-3 (b) The governing body of a participating subdivision may
30-4 increase the rate of its member contributions effective on the
30-5 first day of any calendar year [after the first anniversary of the
30-6 effective date of the existing rate].
30-7 (c) The governing body of a participating subdivision may
30-8 reduce the rate of its member contributions effective on the first
30-9 day of any calendar year if, at least 90 days before the date of
30-10 the reduction, the subdivision has given written notice of the
30-11 reduction to [only after the fifth anniversary of the effective
30-12 date of the existing rate and only if] the board of trustees and if
30-13 the actuary determines that[, according to the computations of the
30-14 actuary approved by the board of trustees,] the reduction would not
30-15 impair the ability of the subdivision to fund all obligations
30-16 against its account in the subdivision accumulation fund before the
30-17 25th anniversary of the subdivision's most recent actuarial
30-18 valuation date.
30-19 SECTION 31. Section 845.501(a), Government Code, is amended
30-20 to read as follows:
30-21 (a) As soon as possible after the end of each calendar year,
30-22 the board of trustees shall send to the governing body of each
30-23 subdivision and to each requesting member an annual statement that
30-24 contains the basic financial statements of the retirement system [:]
30-25 [(1) a balance sheet showing the financial and
30-26 actuarial condition of the retirement system at the end of the
30-27 calendar year;]
31-1 [(2) a statement showing the receipts and
31-2 disbursements made during the calendar year;]
31-3 [(3) a statement showing changes in the asset,
31-4 liability, reserve, and surplus accounts during the calendar year;
31-5 and]
31-6 [(4) additional statistics necessary for proper
31-7 interpretation of the condition of the retirement system].
31-8 SECTION 32. Subchapter F, Chapter 845, Government Code, is
31-9 amended by adding Sections 845.505, 845.506, and 845.507 to read as
31-10 follows:
31-11 Sec. 845.505. CLOSING OF ACCOUNTS. (a) If a valid
31-12 application for an annuity or for a refund of the accumulated
31-13 contributions of a former member whose membership has terminated
31-14 under Section 842.109(a)(1) has not been filed with the retirement
31-15 system before the end of the year in which the member dies, the
31-16 retirement system shall mail the notice described by Subsection (d)
31-17 to the most recent address of the decedent's beneficiary as shown
31-18 on system records or, if there is none, to the decedent's most
31-19 recent address as shown on system records. If the notice is
31-20 returned undelivered, the retirement system will make reasonable
31-21 efforts to locate the beneficiary or personal representative. If a
31-22 valid application for an annuity or for a refund of the accumulated
31-23 contributions of a deceased member is not filed with the retirement
31-24 system before the expiration of 180 days after the date the notice
31-25 is sent, the retirement system shall transfer the accumulated
31-26 contributions in the decedent's individual account in the employees
31-27 saving fund to the perpetual endowment account of the endowment
32-1 fund and close the decedent's account.
32-2 (b) On termination of a person's membership under Section
32-3 842.109(a)(4), the retirement system shall mail the notice
32-4 described by Subsection (d) to the former member's most recent
32-5 address as shown on system records. If the notice is returned
32-6 undelivered, the retirement system will make reasonable efforts to
32-7 locate the former member. If a valid application for a refund of
32-8 the accumulated contributions of the former member is not filed
32-9 with the retirement system before the expiration of 180 days after
32-10 the date the notice is sent, the retirement system shall transfer
32-11 the accumulated contributions in the former member's individual
32-12 account in the employees saving fund to the perpetual endowment
32-13 account of the endowment fund and close the former member's
32-14 account.
32-15 (c) If a valid application for retirement or for a refund of
32-16 the accumulated contributions of a member who is no longer in
32-17 covered employment is not filed with the retirement system before
32-18 the end of the later of the year in which the member reaches age
32-19 70-1/2 or the year in which the member terminates covered
32-20 employment, the retirement system shall mail the notice described
32-21 by Subsection (d) to the member at the member's most recent address
32-22 as shown on system records. If the notice is returned undelivered,
32-23 the retirement system will make reasonable efforts to locate the
32-24 member. If a valid application for retirement or for a refund of
32-25 the accumulated contributions of the member is not filed with the
32-26 retirement system before March 15 of the year in which distribution
32-27 must be made under Section 841.010, the person's membership
33-1 terminates as of March 31 of that year, and the retirement system
33-2 shall transfer the accumulated contributions in the member's
33-3 individual account in the employees saving fund to the perpetual
33-4 endowment account of the endowment fund and close the member's
33-5 account.
33-6 (d) A notice under this section must include the name of the
33-7 member or former member, the name of each subdivision from which
33-8 the person received service credit, a statement that a benefit is
33-9 currently payable, a statement of the procedure for obtaining
33-10 payment of that benefit, and a statement that a failure to file a
33-11 valid application for benefits may cause benefits to be forfeited
33-12 to the retirement system.
33-13 (e) If a person files with the retirement system a valid
33-14 application for retirement based on an account that has been closed
33-15 under Subsection (a), (b), or (c), the retirement system shall
33-16 restore the member's individual account in the employees saving
33-17 fund and pay a retirement annuity computed as of the date on which
33-18 the annuity would have been required to begin under this subtitle.
33-19 All annuity payments that previously would have been paid if the
33-20 annuity had begun on the date required under this subtitle will be
33-21 paid to the person as a single sum.
33-22 (f) If a person files with the retirement system a valid
33-23 application for a refund of a member's accumulated contributions
33-24 based on an account that has been closed under Subsection (a), (b),
33-25 or (c), the retirement system shall pay to the applicant from the
33-26 perpetual endowment account of the endowment fund the amount to
33-27 which the applicant is entitled.
34-1 (g) If a person receiving an annuity fails to negotiate more
34-2 than five consecutive annuity payments, the retirement system may
34-3 send a notice to that person, stating that unless the previous
34-4 payments are negotiated within 30 days after the date of the
34-5 notice, payment of benefits will be suspended and the account
34-6 closed until the person files a written request with the retirement
34-7 system to resume payments. After receipt of a written request
34-8 under this subsection, the retirement system will resume making
34-9 monthly payments. All annuity payments that would have otherwise
34-10 been paid if the annuity had not been suspended will be paid to the
34-11 person as a single sum.
34-12 (h) On the death of a person receiving an annuity, the
34-13 retirement system shall make reasonable efforts to locate any
34-14 person to whom annuity payments should continue to be made as a
34-15 result of that death and to notify that person of any information
34-16 necessary in order to make the continued payments. If the
34-17 requested information has not been received by the retirement
34-18 system before the expiration of one year after the annuitant's
34-19 death, the retirement system shall suspend the annuity and close
34-20 the account until all requested information has been received by
34-21 the retirement system. After the retirement system receives the
34-22 requested information, it will resume making monthly payments of
34-23 the annuity and pay in a single sum all payments that were
34-24 suspended.
34-25 (i) The retirement system may apply a similar process as
34-26 provided by Subsections (a), (b), (c), (d), (e), or (f) to other
34-27 money it holds for payment, if the system first determines that no
35-1 claim for the money is likely to be filed.
35-2 Sec. 845.506. APPEAL OF ADMINISTRATIVE DECISION. A decision
35-3 of the board of trustees denying or limiting membership, service
35-4 credit, eligibility for or the amount of benefits payable by the
35-5 retirement system, or regarding to whom benefits should be paid is
35-6 a decision in a contested case as defined by the administrative
35-7 procedure law, Chapter 2001, and is subject to judicial review
35-8 under the substantial evidence rule in accordance with Sections
35-9 2001.174-2001.177.
35-10 Sec. 845.507. QUALIFICATION. It is intended that this
35-11 subtitle be construed and administered in a manner that the
35-12 retirement system will be considered qualified under Section 401(a)
35-13 of the Internal Revenue Code of 1986 (26 U.S.C. Section 401). The
35-14 board of trustees may adopt rules that it determines necessary for
35-15 the retirement system to be considered qualified. Rules adopted by
35-16 the board of trustees relating to qualification issues are
35-17 considered a part of the plan.
35-18 SECTION 33. The following provisions of the Government Code
35-19 are repealed:
35-20 (1) Section 842.202;
35-21 (2) Section 842.203;
35-22 (3) Section 843.303;
35-23 (4) Sections 844.003(d), (e), (f), and (g);
35-24 (5) Section 844.601;
35-25 (6) Section 844.602;
35-26 (7) Section 844.603;
35-27 (8) Section 844.604;
36-1 (9) Section 844.607(c);
36-2 (10) Section 845.111;
36-3 (11) Section 845.315(c);
36-4 (12) Section 845.401;
36-5 (13) Sections 845.402(d), (e), and (f);
36-6 (14) Section 845.503; and
36-7 (15) Section 845.504.
36-8 SECTION 34. This Act takes effect December 31, 1997, except
36-9 Section 21 and this section, which take effect September 1, 1997.
36-10 SECTION 35. The importance of this legislation and the
36-11 crowded condition of the calendars in both houses create an
36-12 emergency and an imperative public necessity that the
36-13 constitutional rule requiring bills to be read on three several
36-14 days in each house be suspended, and this rule is hereby suspended.