By:  Duncan                                           S.B. No. 1620

         Line and page numbers may not match official copy.

         Bill not drafted by TLC or Senate E&E.

                                A BILL TO BE ENTITLED

                                       AN ACT

 1-1     relating to creating an excess benefit arrangement for certain

 1-2     annuitants of the Teacher Retirement System of Texas.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Subchapter F, Chapter 825, Government Code, is

 1-5     amended by adding Section 825.601 to read as follows:

 1-6           Sec. 825.601.  EXCESS BENEFIT ARRANGEMENT.  (a)  A separate,

 1-7     nonqualified, unfunded excess benefit arrangement is created

 1-8     outside of the trust fund of the retirement system.  This excess

 1-9     benefit arrangement shall be administered as a governmental excess

1-10     benefit arrangement pursuant to the provisions of Section 415(m) of

1-11     the Internal Revenue Code of 1986, as amended.  The purpose of the

1-12     excess benefit arrangement is to pay to annuitants of the

1-13     retirement system benefits otherwise payable by the retirement

1-14     system that exceed the limitations on benefits imposed by Section

1-15     415 of the Internal Revenue Code of 1986, as amended.

1-16           (b)  The Board of Trustees is responsible for the

1-17     administration of this arrangement, except as otherwise provided in

1-18     this section, the Board of Trustees may adopt rules to implement

1-19     this section.

1-20           (c)  Benefits under this section are exempt from execution to

1-21     the same extent as provided by Section 821.005 of this subtitle,

 2-1     except that the benefits are completely unassignable.

 2-2     Contributions to this arrangement are not held in trust and may not

 2-3     be commingled with other funds of the retirement system.

 2-4           (d)  An annuitant is entitled to a monthly benefit under this

 2-5     section in an amount equal to the amount by which the annuitant's

 2-6     benefit payable by the retirement system has been reduced by the

 2-7     limitation on benefits imposed by Section 415 of the Internal

 2-8     Revenue Code of 1986, as amended.  The benefit payable by this

 2-9     arrangement shall be paid at such time or times and in such form as

2-10     the benefit under the retirement system would be paid.

2-11           (e)  The benefit payable under this section shall be paid

2-12     using state contributions that would otherwise be made to the

2-13     retirement system under Section 825.404.  In lieu of the state

2-14     contributions being paid to the state contribution account, an

2-15     amount determined by the retirement system necessary to pay

2-16     benefits under this section shall be paid on a monthly basis to a

2-17     separate account established by the Board of Trustees for this

2-18     arrangement and may include amounts needed to pay reasonable and

2-19     necessary expenses of this arrangement.  The amount shall be paid

2-20     to the account at least 15 days before a disbursement is to be made

2-21     under this section.

2-22           SECTION 2.  The importance of this legislation and the

2-23     crowded condition of the calendars in both houses create an

2-24     emergency and an imperative public necessity that the

2-25     constitutional rule requiring bills to be read on three several

 3-1     days in each house be suspended, and this rule is hereby suspended,

 3-2     and that this Act take effect and be in force from and after its

 3-3     passage, and it is so enacted.