By Kuempel H.B. No. 2405
76R4251 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, Government Code, is amended by
1-7 amending Subdivision (5) and adding Subdivisions (16) and (17) to
1-8 read as follows:
1-9 (5) "Compensation" means the payments that do not
1-10 exceed $150,000 in a calendar year, indexed in the same manner as
1-11 is provided by Section 401(a)(17) of the Internal Revenue Code of
1-12 1986 (26 U.S.C. Section 417) and that are made to an employee of a
1-13 participating subdivision by the subdivision for service, including
1-14 nonmonetary compensation, the value of which is determined by the
1-15 governing body of the subdivision. The term does not include
1-16 workers' compensation benefits received by a member under Section
1-17 504.011, Labor Code.
1-18 (16) "Supplemental death benefit program" means the
1-19 voluntary, employer-funded optional death benefits program under
1-20 Subchapter F, Chapter 844. The program constitutes "group-term
1-21 life insurance purchased for employees" as described by Section 79
1-22 of the Internal Revenue Code of 1986.
1-23 (17) "Vested member" means a member who may withdraw
1-24 from employment with all participating subdivisions, leave the
2-1 member's accumulated contributions on deposit with the retirement
2-2 system, and on meeting the age and length-of-service requirements
2-3 for service retirement, file an application for retirement and
2-4 begin to receive a service retirement benefit.
2-5 SECTION 2. Section 842.004, Government Code, is amended by
2-6 adding a new Subsection (e) and redesignating former Subsection (e)
2-7 as Subsection (f) to read as follows:
2-8 (e) If before November 1 of any year a subdivision gives
2-9 written notice of its intention to the retirement system, the
2-10 subdivision may terminate coverage under and discontinue
2-11 participation in the supplemental death benefits fund. A
2-12 termination under this subsection is effective on January 1 of the
2-13 year following the year in which notice is given.
2-14 (f) If a subdivision has previously discontinued
2-15 participation in the fund, the board of trustees in its discretion
2-16 may restrict the right of the subdivision to participate again.
2-17 SECTION 3. Subchapter A, Chapter 842, Government Code, is
2-18 amended by adding Section 842.008 to read as follows:
2-19 Sec. 842.008. NO PARTICIPATION FOR EMPLOYEES HIRED AFTER
2-20 ELECTION. (a) A participating subdivision may not terminate
2-21 participation in the retirement system as long as it has any
2-22 liabilities resulting from the participation of current or former
2-23 employees, but it may elect to discontinue enrolling in the
2-24 retirement system nonmembers whose employment or reemployment
2-25 begins after the effective date of an election to discontinue
2-26 enrollment. If the subdivision has an annually determined
2-27 contribution rate plan, the subdivision must elect to contribute in
3-1 all future years in which the allocation described by Subsection
3-2 (b) is necessary at a rate that is either the rate being paid at
3-3 the time of the election to discontinue enrollment or an integer
3-4 percent greater than the rate being paid at the time of the
3-5 election to discontinue enrollment. The effective date of the
3-6 election to discontinue enrollment is January 1 of the year
3-7 following the year in which the election by the subdivision is
3-8 made.
3-9 (b) If a participating subdivision makes the election
3-10 described by Subsection (a), the assets in that subdivision's
3-11 account in the subdivision accumulation fund shall be allocated
3-12 under the priorities provided by this section, with the details of
3-13 the allocation to be determined by the actuary and approved by the
3-14 board of trustees.
3-15 (c) First priority shall be given to current service credit
3-16 of all members who leave their contributions in the system. If the
3-17 ratio of the sum of the assets and the actuarial present value of
3-18 future subdivision contributions in excess of normal costs, if any,
3-19 to the actuarial present value of current service credits is less
3-20 than one to one, the credits will have to be proportionally
3-21 reduced. The ratio will be redetermined annually and adjustments
3-22 made as needed.
3-23 (d) Second priority shall be given to prior service credit,
3-24 multiple matching credit, and supplemental annuities, without
3-25 differentiation. If the ratio of the sum of the assets and the
3-26 actuarial present value of future subdivision contributions in
3-27 excess of normal costs, if any, for this priority group remaining
4-1 after the allocation described by Subsection (c) to the actuarial
4-2 present value of second priority benefits is less than one to one,
4-3 the annuities and credits may all have to be proportionally
4-4 reduced. If the ratio is greater than one to one, the annuities
4-5 and credits may all have to be proportionally increased, except as
4-6 limited by Subsection (f). The ratio will be redetermined
4-7 annually, and reductions or increases in the annuities and credits
4-8 will be made when considered appropriate to bring the ratio closer
4-9 to one to one.
4-10 (e) A subdivision whose assets in the retirement system have
4-11 been allocated under Subsection (b) may not enroll new members
4-12 unless the subdivision applies to the board of trustees for
4-13 approval and receives it. The board of trustees may not grant
4-14 approval unless the subdivision adopts an order or resolution on
4-15 the terms provided by Subchapter H, Chapter 844.
4-16 (f) If the participating subdivision is not enrolling new
4-17 members in accordance with Subsection (e), the annuities and
4-18 credits described by Subsections (c) and (d) may not be increased
4-19 to a level that exceeds the greater of the level in effect
4-20 immediately before the time Subsection (b) became applicable or the
4-21 level in effect on December 31, 1992.
4-22 (g) When the participating subdivision or its successor has
4-23 no employees who are members of the retirement system and has no
4-24 present or potential liabilities resulting from the participation
4-25 of former employees, the subdivision's participation in the
4-26 retirement system ceases, and the system shall repay to the
4-27 subdivision or its successor the amount in the subdivision
5-1 accumulation fund that is credited to the subdivision. If the
5-2 participating subdivision is no longer in existence and has no
5-3 successor when its participation ceases, the amount in the
5-4 subdivision accumulation fund that is credited to the subdivision
5-5 shall be transferred to the general reserves account of the
5-6 endowment fund.
5-7 (h) If a subdivision whose assets in the retirement system
5-8 have been allocated under Subsection (b) is allowed to begin
5-9 enrolling new members in accordance with Subsection (e), the
5-10 annuities and credits described by Subsections (c) and (d)
5-11 attributable to contributions made by members before the date the
5-12 subdivision begins enrolling new members:
5-13 (1) must be restored to the level in effect
5-14 immediately before Subsection (b) became applicable unless they
5-15 already equal or exceed that level; and
5-16 (2) may not be increased above the greater of the
5-17 level in effect immediately before Subsection (b) became applicable
5-18 or the level in effect immediately before the subdivision began
5-19 enrolling new members until the expiration of four calendar years
5-20 after the date the subdivision begins enrolling new members.
5-21 (i) Before or after the initial allocation under Subsection
5-22 (b) is determined, the subdivision may elect to contribute a
5-23 lump-sum deposit or may elect to contribute in all future years
5-24 that the allocation described by Subsection (b) is necessary at an
5-25 integer percent greater than the rate being paid at the time of the
5-26 election of the integer percent, notwithstanding the provisions of
5-27 Section 844.605 or 844.703.
6-1 SECTION 4. Subchapter A, Chapter 842, Government Code, is
6-2 amended by adding Section 842.009 to read as follows:
6-3 Sec. 842.009. SIGNIFICANT REDUCTION IN NUMBER OF
6-4 CONTRIBUTING MEMBERS. (a) If a participating subdivision reduces
6-5 the number of members in its employment by at least 26 percent but
6-6 less than 100 percent, or to 100 percent if the reduction is
6-7 expected to last less than 12 months, over the 12-month period
6-8 ending with the preceding December, no other participating
6-9 subdivision has assumed funding of the obligations, and the actuary
6-10 recommends to the board of trustees and the board agrees that this
6-11 subsection shall be applied, the assets in that subdivision's
6-12 account in the subdivision accumulation fund shall be allocated
6-13 under the priorities provided by this section, with the details of
6-14 the allocation to be determined by the actuary and approved by the
6-15 board of trustees.
6-16 (b) If the subdivision has an annually determined
6-17 contribution rate plan, the subdivision must elect to contribute in
6-18 all future years in which the allocation described by Subsection
6-19 (a) is necessary at a rate that is either the rate being paid at
6-20 the time Subsection (a) is applied or an integer percent greater
6-21 than the rate being paid at the time Subsection (a) is applied.
6-22 (c) First priority shall be given to current service credit
6-23 of all members who leave their contributions in the system. If the
6-24 ratio of the sum of the assets and the actuarial present value of
6-25 future subdivision contributions in excess of normal costs, if any,
6-26 to the actuarial present value of current service credits is less
6-27 than one to one, the credits will have to be proportionally
7-1 reduced. The ratio will be redetermined annually and adjustments
7-2 made as needed.
7-3 (d) Second priority shall be given to prior service credit,
7-4 multiple matching credit, and supplemental annuities, without
7-5 differentiation. If the ratio of the sum of the assets and the
7-6 actuarial present value of future subdivision contributions in
7-7 excess of normal costs, if any, for this priority group remaining
7-8 after the allocation described by Subsection (c) to the actuarial
7-9 present value of second priority benefits is less than one to one,
7-10 the annuities and credits may all have to be proportionally
7-11 reduced. If the ratio is greater than one to one, the annuities
7-12 and credits may all have to be proportionally increased, except as
7-13 limited by Subsection (e). The ratio will be redetermined
7-14 annually, and reductions or increases in the annuities and credits
7-15 will be made when considered appropriate to bring the ratio closer
7-16 to one to one.
7-17 (e) If the actuary has not recommended and the board of
7-18 trustees has not approved ending the allocation described by
7-19 Subsection (a), the annuities and credits described by Subsections
7-20 (c) and (d) may not be increased to a level that exceeds the level
7-21 in effect immediately before Subsection (a) became applicable.
7-22 (f) If the allocation described by Subsection (a) has been
7-23 ended by action of the board of trustees on the recommendation of
7-24 the actuary, the annuities and credits described by Subsections (c)
7-25 and (d) attributable to contributions made by members before the
7-26 date the allocation was ended:
7-27 (1) must be restored to the level in effect
8-1 immediately before Subsection (a) became applicable unless they
8-2 already equal that level; and
8-3 (2) may not be increased above the level in effect
8-4 immediately before Subsection (a) became applicable until the
8-5 expiration of four calendar years after the allocation ended.
8-6 (g) Before or after the initial allocation under Subsection
8-7 (a) is determined, the subdivision may elect to contribute a
8-8 lump-sum deposit or may elect to contribute in all future years
8-9 that the allocation described by Subsection (a) is necessary at an
8-10 integer percent greater than the rate being paid at the time of the
8-11 election of the integer percent, notwithstanding the provisions of
8-12 Section 844.605 and Section 844.703.
8-13 SECTION 5. Subchapter A, Chapter 842, Government Code, is
8-14 amended by adding Section 842.010 to read as follows:
8-15 Sec. 842.010. REDUCTION TO NO CONTRIBUTING MEMBERS. (a) If
8-16 a participating subdivision is abolished or reduces the number of
8-17 members in its employment to zero, with the reduction expected to
8-18 last at least 12 months, so that it no longer contributes to the
8-19 system and no other participating subdivision has assumed funding
8-20 of the obligations, the assets in that subdivision's account in the
8-21 subdivision accumulation fund shall be allocated under the
8-22 priorities provided by this section, with the details of the
8-23 allocation to be determined by the actuary and approved by the
8-24 board of trustees. Service retirement will be allowed at age 60
8-25 with at least four years of credited service.
8-26 (b) First priority shall be given to current service credit
8-27 of all members who leave their contributions in the system. If the
9-1 ratio of the assets to the actuarial present value of current
9-2 service credits is less than one to one, the credits will have to
9-3 be proportionally reduced. The ratio will be redetermined annually
9-4 and adjustments made as needed.
9-5 (c) Second priority shall be given to prior service credit,
9-6 multiple matching credit, and supplemental annuities, without
9-7 differentiation. If the ratio of the assets for this priority
9-8 group remaining after the allocation described by Subsection (b) to
9-9 the actuarial present value of second priority benefits is less
9-10 than one to one, the annuities and credits may all have to be
9-11 proportionally reduced. If the ratio is greater than one to one,
9-12 the annuities and credits may all have to be proportionally
9-13 increased, except as limited by Subsection (e). The ratio will be
9-14 redetermined annually, and reductions or increases in the annuities
9-15 and credits will be made when considered appropriate to bring the
9-16 ratio closer to one to one.
9-17 (d) A subdivision whose assets in the retirement system have
9-18 been allocated under Subsection (a) may not enroll new members
9-19 unless the subdivision applies to the board of trustees for
9-20 approval and receives it. The board of trustees may not grant
9-21 approval unless the subdivision adopts an order or resolution on
9-22 the terms provided by Subchapter H, Chapter 844.
9-23 (e) If the participating subdivision is not enrolling new
9-24 members in accordance with Subsection (d), the annuities and
9-25 credits described by Subsections (b) and (c) may not be increased
9-26 to a level that exceeds the level in effect immediately before
9-27 Subsection (a) became applicable.
10-1 (f) When the participating subdivision or its successor has
10-2 no employees who are members of the retirement system and has no
10-3 present or potential liabilities resulting from the participation
10-4 of former employees, the subdivision's participation in the
10-5 retirement system ceases, and the system shall repay to the
10-6 subdivision or its successor the amount in the subdivision
10-7 accumulation fund that is credited to the subdivision. If the
10-8 participating subdivision is no longer in existence and has no
10-9 successor when its participation ceases, the amount in the
10-10 subdivision accumulation fund that is credited to the subdivision
10-11 shall be transferred to the general reserves account of the
10-12 endowment fund.
10-13 (g) If a subdivision whose assets in the retirement system
10-14 have been allocated under Subsection (a) is allowed to begin
10-15 enrolling new members in accordance with Subsection (d), the
10-16 annuities and credits described by Subsections (b) and (c)
10-17 attributable to contributions made by members before the date the
10-18 subdivision begins enrolling new members:
10-19 (1) must be restored to the level in effect
10-20 immediately before Subsection (a) became applicable unless they
10-21 already equal that level; and
10-22 (2) may not be increased above the level in effect
10-23 immediately before Subsection (a) became applicable until the
10-24 expiration of four calendar years after the date the subdivision
10-25 begins enrolling new members.
10-26 (h) Before the initial allocation under Subsection (a) is
10-27 determined, the subdivision may elect to contribute a lump-sum
11-1 deposit.
11-2 SECTION 6. Section 842.105, Government Code, is amended to
11-3 read as follows:
11-4 Sec. 842.105. STATUS AS AN EMPLOYEE. For the purposes of
11-5 this subtitle, a person has the standing of an employee in a
11-6 participating subdivision if the person:
11-7 (1) is employed in a position that normally requires
11-8 services from the person for not less than 900 hours a year by a
11-9 community supervision and corrections [judicial district probation]
11-10 department that has executed a contract with the participating
11-11 subdivision under Section 76.006, Government Code [Article 42.12,
11-12 Code of Criminal Procedure]; or
11-13 (2) is eligible for optional membership in the
11-14 retirement system under Subchapter C.
11-15 SECTION 7. Section 842.106(a), Government Code, is amended
11-16 to read as follows:
11-17 (a) Except as provided by this section, a person who is
11-18 [not] an employee eligible for membership and is [not] eligible to
11-19 receive credit in this retirement system for service performed for
11-20 a subdivision is not [that makes a person] eligible for credit for
11-21 that service [membership or is creditable] in another pension fund
11-22 or retirement system that is at least partly supported at public
11-23 expense. It is the responsibility of the subdivision to enforce
11-24 this provision.
11-25 SECTION 8. Section 842.108(a), Government Code, is amended
11-26 to read as follows:
11-27 (a) A person who is not an employee of any participating
12-1 subdivision and who has not retired may, by written [after]
12-2 application, withdraw from membership in the retirement system, and
12-3 the person's account will be closed and the person will be paid:
12-4 (1) the accumulated contributions in the member's
12-5 individual account in the employees saving fund; plus
12-6 (2) interest computed from the beginning of the
12-7 calendar year of withdrawal through the end of the month before the
12-8 month in which withdrawal occurs on the balance in the member's
12-9 individual account in the employees saving fund on January 1 of the
12-10 year of withdrawal [all of the accumulated contributions credited
12-11 to the person's individual account in the employees saving fund,
12-12 and the retirement system shall close the account].
12-13 SECTION 9. Section 842.109, Government Code, is amended to
12-14 read as follows:
12-15 Sec. 842.109. TERMINATION OF MEMBERSHIP. (a) A person
12-16 terminates membership in the retirement system by:
12-17 (1) death;
12-18 (2) retirement;
12-19 (3) withdrawal of all of the person's contributions
12-20 while absent from service; or
12-21 (4) absence from service for five consecutive years
12-22 [or more either before accumulating enough credited service to
12-23 enable the person to retire without additional service or] before
12-24 accumulating four or more years of credited service [with one or
12-25 more subdivisions that have adopted a program allowing retirement
12-26 without additional service after accumulation of 12 years of
12-27 credited service].
13-1 (b) A member of the retirement system is not absent from
13-2 service and continues to accumulate membership credited service if
13-3 the person[:]
13-4 [(1)] leaves employment with a participating
13-5 subdivision to perform and does perform qualified military service
13-6 in the uniformed services as that term is defined in the Uniformed
13-7 Services Employment and Reemployment Rights Act of 1994 (38 U.S.C.
13-8 Section 4301 et seq.) and that meets the requirements of that Act
13-9 [active duty service in the armed forces or the armed forces
13-10 reserves of the United States or an auxiliary of the armed forces
13-11 or reserves], and if:
13-12 (1) [(A)] the person applies for reemployment with the
13-13 same subdivision not later than the 90th day after the date the
13-14 person is [released from active duty or] discharged from military
13-15 service under honorable conditions or released from hospitalization
13-16 continuing after being discharged under honorable conditions
13-17 [release or discharge] for a period of not more than two years [one
13-18 year]; and
13-19 (2) [(B)] the person is reemployed by the same
13-20 participating subdivision [; or]
13-21 [(2) is conscripted and leaves employment with a
13-22 participating subdivision to perform and does perform war-related
13-23 service during a state of war or conflict between the armed forces
13-24 of the United States and a foreign country, and if the person
13-25 applies for and is reemployed by the same subdivision not later
13-26 that the 90th day after the date the person is released from active
13-27 duty or discharged from military service].
14-1 (c) On any termination of membership in the retirement
14-2 system, a person forfeits all credited service established in the
14-3 retirement system.
14-4 SECTION 10. Section 842.110(f), Government Code, is amended
14-5 to read as follows:
14-6 (f) If a person with credited service under this section
14-7 dies before a payment under Subsection (g) is made, the person's
14-8 beneficiary, or if there is no beneficiary surviving, the person's
14-9 spouse, or if there is no surviving spouse, the executor or
14-10 administrator of the person's estate, may elect payment as provided
14-11 by Section 844.407 [844.105(c)].
14-12 SECTION 11. Section 842.111(c), Government Code, is amended
14-13 to read as follows:
14-14 (c) If a person with credited service under this section
14-15 dies before a payment under Subsection (d) is made, the person's
14-16 beneficiary or, if no beneficiary survives, the person's spouse, or
14-17 if there is no surviving spouse, the executor or administrator of
14-18 the person's estate, may elect payment as provided by Section
14-19 844.407 [844.105(c)].
14-20 SECTION 12. Section 842.112, Government Code, is amended by
14-21 amending Subsection (c) and adding Subsection (i) to read as
14-22 follows:
14-23 (c) Except as provided by Subsection (i), a [A] correction
14-24 may not be made unless the retirement system receives, in addition
14-25 to the application, each of the items required under Subsections
14-26 (d), (e), and (f), and one of the following:
14-27 (1) a written agreement, approved by the subdivision's
15-1 governing body, stating that an error has occurred and that the
15-2 subdivision has agreed to correct that [the] error;
15-3 (2) a final judgment by a court of competent
15-4 jurisdiction in proceedings to which the subdivision was a party,
15-5 ordering that the subdivision correct the error; or
15-6 (3) an order in an administrative proceeding to which
15-7 the subdivision was a party, directing that the subdivision correct
15-8 the error, that is no longer subject to appeal.
15-9 (i) The correction of an error affecting not more than three
15-10 monthly reports within a period of not more than three consecutive
15-11 months may be made on the basis of the application alone if the
15-12 application, the supplemental report, and the payment required by
15-13 this section are received by the retirement system within six
15-14 months after the first day of the first month for which the
15-15 correction is being made.
15-16 SECTION 13. Section 842.112, Government Code, is amended by
15-17 adding Subsections (j) and (k) to read as follows:
15-18 (j) If, as a result of a suit against a participating
15-19 subdivision in a court of competent jurisdiction, a person receives
15-20 a judgment against a subdivision ordering that the person be
15-21 reinstated as an employee of the subdivision retroactively to the
15-22 date the person's employment was terminated and ordering that the
15-23 person receive credit toward retirement for the reinstated service,
15-24 on written application to the retirement system, the system shall
15-25 grant the service credit if:
15-26 (1) the judgment has become final and is no longer
15-27 subject to appeal;
16-1 (2) a certified copy of the judgment accompanies the
16-2 application;
16-3 (3) the retirement system receives payment from the
16-4 person in an amount equal to the contributions the person would
16-5 have made to the system if the employment had not been terminated
16-6 and the service reported to the system; and
16-7 (4) the retirement system receives payment from the
16-8 subdivision in an amount equal to the additional contributions that
16-9 the subdivision would have made to the system for the additional
16-10 credited service.
16-11 (k) If a person to whom Subsection (j) applies has forfeited
16-12 service credit as a result of withdrawal of contributions during
16-13 the time between the termination of employment and the date of
16-14 reinstatement, the person is eligible to reestablish credit under
16-15 Section 843.003. For purposes of this subsection, forfeited credit
16-16 based on service performed for more than one participating
16-17 subdivision is considered to have been credit for service performed
16-18 only for the subdivision that is subject to the judgment, except
16-19 that credit may not be reinstated under this subsection for service
16-20 performed after the date of the termination of employment that
16-21 resulted in the judgment.
16-22 SECTION 14. Section 843.105(d), Government Code, is amended
16-23 to read as follows:
16-24 (d) Interest is earned [for each whole year] on an allocated
16-25 prior service credit from the effective date of membership to the
16-26 effective date of retirement at the applicable rate for the period
16-27 as provided by Section 845.314.
17-1 SECTION 15. Section 843.201(d), Government Code, is amended
17-2 to read as follows:
17-3 (d) Allocated prior service credits are allowable for a
17-4 subdivision only if [the retirement system's actuary certifies
17-5 that]:
17-6 (1) [the subdivision contribution rate will not exceed
17-7 the employee contribution rate plus three percent, if] the
17-8 subdivision has adopted the provisions for an annually determined
17-9 contribution rate plan under Subchapter H, Chapter 844; or
17-10 (2) the retirement system's actuary determines that
17-11 the subdivision's unfunded actuarial accrued liability amortization
17-12 period will be less than 25 years, if the subdivision has not
17-13 adopted the provisions of Subchapter H, Chapter 844.
17-14 SECTION 16. Section 843.203(a), Government Code, is amended
17-15 to read as follows:
17-16 (a) The governing body of a subdivision that has taken over
17-17 the facilities of a hospital, utility, or other public facility
17-18 formerly operated by another participating subdivision may assume
17-19 in whole or in part the obligations that the former employer had
17-20 undertaken under this subtitle by reason of service performed by
17-21 members of the system who become employees of the subdivision
17-22 seeking to participate in the system. A subdivision participating
17-23 in the system that could have assumed the obligations of another
17-24 subdivision had this section been in effect at time of
17-25 participation may assume in whole or in part the obligations that
17-26 the subdivision that was the first employer had undertaken by
17-27 reason of service rendered by members who became employees of the
18-1 subdivision that is the second employer. The governing body of a
18-2 subdivision that assumes the obligations of another subdivision
18-3 under this section may make a lump-sum deposit to the account of
18-4 the other subdivision in the retirement system, in an amount
18-5 computed by the retirement system's actuary, on terms that are
18-6 agreed to in writing by the affected subdivisions and approved by
18-7 the board of trustees. Assumptions under this section shall be by
18-8 written agreement between the affected subdivisions and are subject
18-9 to approval of the board of trustees. An agreement under this
18-10 section may be amended in writing by the affected subdivisions if
18-11 the amendment is approved by the board of trustees.
18-12 SECTION 17. Section 843.403(d), Government Code, is amended
18-13 to read as follows:
18-14 (d) Interest is earned [for each whole calendar year] on a
18-15 current service credit or multiple matching credit from the end of
18-16 each calendar year to the effective date of the member's retirement
18-17 at the rate credited annually to a member's individual account in
18-18 the employees saving fund.
18-19 SECTION 18. Section 843.501, Government Code, is amended to
18-20 read as follows:
18-21 Sec. 843.501. LEGISLATIVE SERVICE. (a) A member may
18-22 establish credit for current service in the retirement system for
18-23 service performed as a member of the legislature[, if the member
18-24 deposits with the system a contribution in an amount computed for
18-25 each month of service claimed at the contribution rate currently
18-26 required of an employee of the subdivision that employs the member,
18-27 multiplied by $400. On the member's making a deposit, the
19-1 employing subdivision shall deposit with the retirement system a
19-2 contribution in an amount equal to the amount deposited by the
19-3 member].
19-4 [(b)] A member claiming credit for previous legislative
19-5 service shall file a detailed statement of the service with the
19-6 treasurer or other disbursing officer of the subdivision by which
19-7 the member is currently employed. As soon as practicable after the
19-8 filing of a statement, the employing subdivision shall verify the
19-9 service claimed and certify to the board of trustees the amount of
19-10 service approved.
19-11 (b) Credit may not be established under this section for
19-12 service that is simultaneously credited by another retirement
19-13 system or program established or governed by state law.
19-14 SECTION 19. Section 843.601, Government Code, is amended to
19-15 read as follows:
19-16 Sec. 843.601. CURRENT SERVICE FOR QUALIFIED MILITARY SERVICE
19-17 [MILITARY DUTY]. (a) In this section, "qualified military
19-18 service" means service in the uniformed services as that term is
19-19 defined in the Uniformed Services Employment and Reemployment
19-20 Rights Act of 1994 (38 U.S.C. Section 4301 et seq.) and that meets
19-21 the requirements of that Act as it now exists or is amended as to
19-22 the character of service performed.
19-23 (b) All members of the retirement system are entitled to
19-24 receive credit for qualified military service that is subject to
19-25 the Uniformed Services Employment and Reemployment Rights Act of
19-26 1994 (38 U.S.C. Section 4301 et seq.). Notwithstanding any
19-27 provision of this subtitle to the contrary, contributions,
20-1 benefits, and service credit for qualified military service will be
20-2 provided in accordance with Section 414(u) of the Internal Revenue
20-3 Code of 1986. The board of trustees may adopt rules that modify
20-4 the terms of this subtitle for the purpose of compliance with the
20-5 provisions of that Act.
20-6 (c) The governing body of a participating subdivision also
20-7 may, on the terms provided by Section 844.704, authorize the
20-8 establishment of credit for current service in the retirement
20-9 system for qualified military service as provided by this
20-10 subsection. Qualified military service includes military service
20-11 before becoming an employee of the subdivision. A member eligible
20-12 to establish credit under this subsection is one who has performed
20-13 as an employee at least 10 years of service that is credited in the
20-14 retirement system and who does not receive and is not eligible to
20-15 receive federal retirement payments based on 20 years or more of
20-16 active federal military duty or its equivalent. An eligible member
20-17 may establish credit under this subsection by filing with the
20-18 retirement system an application for the credit.
20-19 (d) A subdivision whose governing body authorized "current
20-20 service for military duty" before December 31, 1999, has authorized
20-21 credit for current service under Subsection (c).
20-22 (e) Except for service credit established with the
20-23 retirement system before December 31, 1999, the maximum amount of
20-24 credited service that a person may receive under this section is
20-25 five years. If a person would receive more than five years of
20-26 service credit as a result of having received credit under
20-27 Subsection (c) before receiving credit under Subsection (b),
21-1 service credit under Subsection (c) shall be canceled to the extent
21-2 necessary to reduce the total to five years of credit [The
21-3 governing body of a participating subdivision may, on the terms
21-4 provided by Section 844.201, authorize the establishment of credit
21-5 for current service in the retirement system for military service
21-6 creditable as provided by this section.]
21-7 [(b) Military service creditable in the retirement system
21-8 under this section is service as a member of the armed forces of
21-9 the United States during a time, or before the first anniversary of
21-10 the last day of a time, that the United States is or was engaged
21-11 in:]
21-12 [(1) organized conflict with foreign forces, whether a
21-13 state of war or a police action; or]
21-14 [(2) a crisis in this country.]
21-15 [(c) The board of trustees by rule shall determine the
21-16 periods recognized for purposes of this subtitle as times of
21-17 organized conflict or crisis.]
21-18 [(d) A member eligible to establish credit under this
21-19 section is one who:]
21-20 [(1) does not receive and is not eligible to receive
21-21 federal retirement payments based on 20 years or more of active
21-22 federal military duty or its equivalent;]
21-23 [(2) has been released from military duty under
21-24 conditions not dishonorable;]
21-25 [(3) became a member of the retirement system after
21-26 release from military duty; and]
21-27 [(4) has performed as an employee at least 10 years of
22-1 service that is credited in the retirement system.]
22-2 [(e) An eligible member may establish credit under this
22-3 section by filing with the retirement system an application for the
22-4 credit. An application must be accompanied by a contribution in an
22-5 amount computed as the number of months of service claimed under
22-6 this section, times the lesser of:]
22-7 [(1) the member's average monthly contribution for the
22-8 first 12 months as an employee after becoming a member of the
22-9 retirement system; or]
22-10 [(2) $15.]
22-11 [(f) If a member makes a deposit under Subsection (e), the
22-12 subdivision shall deposit with the retirement system a contribution
22-13 in an amount equal to the amount deposited under Subsection (e).]
22-14 [(g) The maximum amount of current credited service that may
22-15 be established under this section is:]
22-16 [(1) 3 years, if the member has performed as an
22-17 employee at least 10 but less than 15 years of service that is
22-18 credited in the retirement system; or]
22-19 [(2) 5 years, if the member has performed as an
22-20 employee at least 15 years of service that is credited in the
22-21 system].
22-22 (f) [(h)] Credit may not be established under this section
22-23 for service that is [simultaneously] credited by another retirement
22-24 system or program established or governed by state law.
22-25 SECTION 20. Section 843.701, Government Code, is amended to
22-26 read as follows:
22-27 Sec. 843.701. INCREASE IN PRIOR SERVICE CREDITS. The
23-1 governing body of a participating subdivision may not[, on the
23-2 terms provided by Section 844.201,] increase the percentage of
23-3 maximum prior service credits used in determining the allocated
23-4 prior service credits under Section 843.105 except on the terms
23-5 provided by Subchapter H, Chapter 844 [previously granted and in
23-6 effect concerning prior service with the subdivision].
23-7 SECTION 21. Section 843.703, Government Code, is amended to
23-8 read as follows:
23-9 Sec. 843.703. INCREASE IN MULTIPLE MATCHING CREDITS. [(a)]
23-10 The governing body of a participating subdivision may not[, on the
23-11 terms provided by Section 844.201,] increase the percentage used in
23-12 determining multiple matching credits under Section 843.403 except
23-13 on the terms provided by Subchapter H, Chapter 844 [843.403(c)].
23-14 [(b) A percentage increase in multiple matching credits must
23-15 be in a multiple of 10 percent of the amount of member
23-16 contributions and must be applied to all members and annuitants who
23-17 have performed or subsequently perform current service that is
23-18 credited with the subdivision in the retirement system.]
23-19 SECTION 22. Section 844.002(c), Government Code, is amended
23-20 to read as follows:
23-21 (c) A supplemental annuity is an amount payable from the
23-22 subdivision accumulation fund, subject to reduction under Section
23-23 842.008(d), 842.009(d), 842.010(c), [Section 842.004(c)] or
23-24 845.307(c), and is actuarially determined from the sum of:
23-25 (1) a member's allocated prior service credit,
23-26 accumulated at interest as provided by Section 843.105(d); and
23-27 (2) a member's multiple matching credit, accumulated
24-1 at interest as provided by Section 843.403(d).
24-2 SECTION 23. Section 844.003, Government Code, is amended by
24-3 amending Subsections (b) and (c) and adding Subsection (d) to read
24-4 as follows:
24-5 (b) If a member who is eligible under Section 844.407
24-6 [844.105, 844.106, 844.203, 844.204, 844.207(e), or 844.210(e)] to
24-7 select an optional retirement annuity dies before retirement, the
24-8 member is considered to have retired on the last day of the month
24-9 before the month in which death occurred [or on the day before the
24-10 first anniversary of the effective date of the person's membership,
24-11 whichever is later].
24-12 (c) Except as provided by Subsection (b), the effective date
24-13 of a member's disability retirement is the date designated on the
24-14 application for retirement filed by or for the member as provided
24-15 by Section 844.301, but the date must be the last day of a calendar
24-16 month and may not precede the date the member terminates employment
24-17 with all participating subdivisions.
24-18 (d) Notwithstanding Subsections (a), (b), and (c), the
24-19 effective retirement date of a member may not precede the first
24-20 anniversary of the earlier of the effective date of the person's
24-21 membership in the retirement system or the effective date of
24-22 participation of the subdivision from which the member had most
24-23 recently earned credited service.
24-24 SECTION 24. Section 844.006, Government Code, is amended by
24-25 amending Subsection (c) and adding Subsection (f) to read as
24-26 follows:
24-27 (c) A retiree who selected an optional annuity under Section
25-1 844.104(c)(1), (c)(2), (c)(5), or (c)(6) or Section 844.305(c)(1),
25-2 (c)(2), (c)(5), or (c)(6) may revoke the designation of the
25-3 beneficiary to receive the annuity on the death of the retiree, if
25-4 a court of competent jurisdiction in a divorce proceeding involving
25-5 the retiree and beneficiary awards to the retiree the entire
25-6 retirement benefit earned by the retiree. The order awarding the
25-7 retirement benefit may be set forth in the divorce decree or in an
25-8 order approving the terms of a property settlement agreement
25-9 incident to the divorce of the retiree and beneficiary but must be
25-10 dated on or after December 31, 1999. The revocation takes effect
25-11 when the retirement system receives it and cancels the optional
25-12 annuity selection made by the retiree. Beginning with the month
25-13 following the month in which the retirement system receives the
25-14 notice of revocation, the retiree is entitled to receive a standard
25-15 service or disability retirement annuity, as applicable, in the
25-16 same amount that the retiree would receive for the same month if
25-17 the retiree had originally retired with a standard service or
25-18 disability retirement annuity [Any selection and designation of
25-19 beneficiary under Subsection (a) or (b) must be in writing on forms
25-20 prescribed by the board of trustees and becomes effective on filing
25-21 with the director].
25-22 (f) The retirement system by rule may establish requirements
25-23 for forms, documentation, and procedures necessary or desirable for
25-24 the administration of this section.
25-25 SECTION 25. Sections 844.007(a) and (b), Government Code,
25-26 are amended to read as follows:
25-27 (a) The [Except as provided by Subsection (g), the]
26-1 adjustments prescribed in this section shall be made in computing
26-2 the benefits of and to the accounts of any member who retires
26-3 effective at the end of any month other than December.
26-4 (b) Interest [Through December 31, 1995, current and
26-5 supplemental interest will be credited on the balance in the
26-6 member's individual account in the employees saving fund on January
26-7 1 of the year of retirement from that date to the effective date of
26-8 retirement at the rates allowed on individual accounts of members
26-9 as of December 31 of the preceding year. For periods that begin
26-10 after December 31, 1995, interest] will be credited on the balance
26-11 in the member's individual account in the employees saving fund on
26-12 January 1 of the year of retirement from that date to the effective
26-13 date of retirement.
26-14 SECTION 26. Section 844.101, Government Code, is amended to
26-15 read as follows:
26-16 Sec. 844.101. APPLICATION FOR SERVICE RETIREMENT ANNUITY. A
26-17 member may apply for a service retirement annuity by filing an
26-18 application for retirement with the board of trustees on or [not
26-19 less than 15 days] before the member's effective retirement date
26-20 designated on the application.
26-21 SECTION 27. Section 844.102, Government Code, is amended to
26-22 read as follows:
26-23 Sec. 844.102. ELIGIBILITY FOR SERVICE RETIREMENT ANNUITY.
26-24 [(a)] A member is eligible[, beginning on the first anniversary of
26-25 the effective date of the person's membership,] to apply for
26-26 [retire] and receive a service retirement annuity, if the member:
26-27 (1) is at least 60 years old and has at least 12 years
27-1 of credited service in the retirement system; [or]
27-2 (2) has at least 30 years of credited service in the
27-3 retirement system; or
27-4 (3) has met the eligibility requirements for service
27-5 retirement under Section 844.207, 844.210, or 844.211.
27-6 [(b) A member may terminate employment with all
27-7 participating subdivisions and, beginning on the first anniversary
27-8 of the effective date of the person's membership, remain eligible
27-9 to retire and receive a service retirement annuity at any time
27-10 after the member attains the age of 60, if the member has at least
27-11 20 years of credited service in the retirement system.]
27-12 [(c) A member whose most recent service was performed for a
27-13 subdivision having an effective date of participation in the
27-14 retirement system after August 31, 1979, may terminate employment
27-15 with all participating subdivisions and remain eligible to retire
27-16 and receive a service retirement annuity at any time after the
27-17 member attains the age of 60, if the member has at least 12 years
27-18 of credited service performed for one or more subdivisions that are
27-19 either subject to this subsection or have adopted a like provision
27-20 under Section 844.202.]
27-21 SECTION 28. Section 844.104(j), Government Code, is amended
27-22 to read as follows:
27-23 (j) A retiree who dies before the 31st day after the
27-24 effective date of service retirement and who did not select an
27-25 optional service retirement annuity before death is considered to
27-26 have selected an optional annuity under Subsection (c)(7) [(c)(4)].
27-27 Alternatively, the decedent's beneficiary may elect to receive a
28-1 refund of the decedent's accumulated contributions under Section
28-2 844.401, in which case the decedent will be considered to have been
28-3 a contributing member at the time of death.
28-4 SECTION 29. Section 844.202, Government Code, is amended to
28-5 read as follows:
28-6 Sec. 844.202. VESTED ELIGIBILITY TO FUTURE RETIREMENT
28-7 [OPTIONAL SERVICE RETIREMENT ELIGIBILITY]. A [(a) The governing
28-8 body of a participating subdivision may authorize an employee of
28-9 the subdivision who is a] member of the retirement system is a
28-10 vested member and may [to] terminate employment with all
28-11 participating subdivisions [the subdivision] and remain eligible to
28-12 retire and receive a service retirement annuity at any time after
28-13 the member attains the age of 60, if the member leaves the member's
28-14 accumulated contributions on deposit with the retirement system
28-15 and:
28-16 (1) has at least 12 years of credited service;
28-17 (2) has at least 10 years of Section 844.207 credited
28-18 service; or
28-19 (3) has at least 8 years of Section 844.210 credited
28-20 service [performed for one or more subdivisions that either have
28-21 authorized the eligibility under this section or are subject to
28-22 Section 844.102(c)].
28-23 [(b) The governing body of a subdivision may not authorize
28-24 eligibility for service retirement under this section except on the
28-25 terms provided by Section 844.201.]
28-26 SECTION 30. Section 844.207, Government Code, is amended to
28-27 read as follows:
29-1 Sec. 844.207. OPTIONAL BENEFIT ELIGIBILITY PLAN. (a) The
29-2 provisions of this section shall apply to all subdivisions that
29-3 [which] elect after September 1, 1985, to begin participation in
29-4 the retirement system. Subject to the conditions in this section
29-5 [below], the governing body of any subdivision participating as of
29-6 September 1, 1985, may adopt the plan provisions of this section.
29-7 (b) The term "Section 844.207 credited service" as used in
29-8 this section means credited service performed for one or more
29-9 participating subdivisions that have adopted the plan provisions of
29-10 this section or the plan provisions of Section 844.210.
29-11 (c) A member is [shall be] eligible[, beginning on the first
29-12 anniversary date of the person's membership,] to apply for [retire]
29-13 and receive a service retirement annuity, if the member:
29-14 (1) is at least 60 years old and has at least 10 years
29-15 of Section 844.207 credited service in the retirement system; or
29-16 (2) is less than 60 years old and has sufficient years
29-17 of Section 844.207 credited service in the retirement system that,
29-18 when that [such] number is added to the years of attained age of
29-19 the member, produces a sum equal to or in excess of the number 80;
29-20 or
29-21 (3) if a member is eligible for service retirement
29-22 under any other provision of this subtitle.
29-23 (d) A member who has 10 years or more of Section 844.207
29-24 credited service is a vested member for purposes of Sections
29-25 844.202, 844.302, and 844.303 [If a member has 10 years or more of
29-26 Section 844.207 credited service in the retirement system,
29-27 subsequent absence from service shall not terminate membership, and
30-1 unless membership is otherwise terminated, the member shall be
30-2 eligible to retire and receive a service retirement annuity at any
30-3 time after the member attains the age of 60 years].
30-4 (e) A member who on December 31, 1999, has any Section
30-5 844.207 credited service, whose membership in the retirement system
30-6 continues after that date without interruption, and who accumulates
30-7 four years or more of Section 844.207 credited service is eligible
30-8 to receive a service retirement benefit when the number of years of
30-9 Section 844.207 credited service added to the years of the member's
30-10 attained age equals or exceeds the number 80 [An employee of a
30-11 participating subdivision which has adopted the plan provisions of
30-12 this section may select an optional service retirement annuity in
30-13 the manner and under the conditions provided in Section 844.105, if
30-14 the member:]
30-15 [(1) has 10 or more years of Section 844.207 credited
30-16 service in the retirement system and has attained the age of 60
30-17 years; or]
30-18 [(2) has at least 20 years of Section 844.207 credited
30-19 service or is otherwise eligible to make such selection of an
30-20 optional service retirement annuity under the provisions of Section
30-21 844.105, 844.106, 844.203, or 844.204.]
30-22 [If a member who is authorized under this subsection to
30-23 select an optional service retirement annuity dies before
30-24 retirement without having made a selection, the member's surviving
30-25 spouse or the executor or administrator of the member's estate may
30-26 make the selection provided by Section 844.105 under the terms of
30-27 that subsection.]
31-1 [(f) A member who has 10 years or more of Section 844.207
31-2 credited service in the retirement system is eligible to retire and
31-3 receive a disability retirement annuity if the member is the
31-4 subject of a certification issued as provided in Section
31-5 844.303(b)(2); but a member is not entitled to retire for
31-6 disability before the first anniversary of the effective date of
31-7 the person's membership. A member eligible to receive a disability
31-8 retirement annuity under this subsection may, if the member is
31-9 eligible for service retirement, elect to receive a service
31-10 retirement annuity but may not receive both annuities.]
31-11 [(g) For the purposes of Subsections (c), (d), (e), and (f),
31-12 each month of credited service under Section 844.210 is considered
31-13 a month of Section 844.207 credited service].
31-14 (f) [(h)] After 1991, the governing body of a subdivision
31-15 may not adopt the plan provisions of this section except on the
31-16 terms provided by Subchapter H [of this chapter].
31-17 SECTION 31. Section 844.209, Government Code, is amended to
31-18 read as follows:
31-19 Sec. 844.209. ALTERNATIVE OPTIONAL INCREASE IN RETIREMENT
31-20 ANNUITIES [OPTIONAL BENEFIT FOR SURVIVING BENEFICIARY OF VESTED
31-21 MEMBER]. (a) The governing body of a participating subdivision,
31-22 from time to time but not more frequently than once in each
31-23 12-month period, may provide for increased annuities to be paid to
31-24 retirees and beneficiaries of deceased retirees of the subdivision.
31-25 The governing body of the subdivision may not elect an increase in
31-26 retirement annuities under Section 844.208 and under this section
31-27 in the same 12-month period.
32-1 (b) An increase under this section applies to all annuities
32-2 for which the effective retirement date is at least twelve months
32-3 before the effective date of the increase.
32-4 (c) The amount of annuity increase under this section is
32-5 computed as the sum of the person's basic and supplemental
32-6 annuities on the effective date of the increase multiplied by the
32-7 integer percentage increase specified by the governing body for all
32-8 annuitants in the order or resolution adopting the increase.
32-9 (d) Except as provided by Subsection (g), the effective date
32-10 of an order or resolution under this section is January 1 of the
32-11 year that begins after the year in which the governing body adopts
32-12 and notifies the retirement system of the order or resolution.
32-13 (e) An increase in an annuity that was reduced because of an
32-14 option selection is reducible in the same proportion and in the
32-15 same manner that the original annuity was reduced.
32-16 (f) The amount of an increase under this section is payable
32-17 as a supplemental annuity, is an obligation of the subdivision's
32-18 account in the subdivision accumulation fund, and is subject to
32-19 reduction under Section 845.307(c).
32-20 (g) The governing body of a subdivision may not adopt an
32-21 order or resolution under this section except on the terms provided
32-22 by Subchapter H. [This section applies to all subdivisions that
32-23 elect after December 31, 1991, to begin participation in the
32-24 retirement system. Subject to the conditions provided by this
32-25 section, the governing body of any subdivision participating before
32-26 January 1, 1992, may adopt the plan provisions of this section.]
32-27 [(b) If a member who has sufficient credited service
33-1 performed for subdivisions that have adopted or are subject to this
33-2 section to entitle the member to withdraw from service, to leave on
33-3 deposit with the retirement system the member's accumulated
33-4 contributions, and, on attainment of an age prescribed by this
33-5 subtitle, to retire with a service retirement benefit dies before
33-6 becoming eligible for deferred service retirement and leaves
33-7 surviving a person whom the member has designated as beneficiary
33-8 entitled to payment of the member's accumulated contributions if
33-9 the member dies before retirement, the surviving beneficiary may by
33-10 written notice filed with the board elect to receive, in lieu of
33-11 the accumulated deposits, an annuity payable during the lifetime of
33-12 the surviving beneficiary in the amount that would have been
33-13 payable to the surviving beneficiary had the member retired on the
33-14 last day of the month preceding the month in which the death
33-15 occurred under an optional annuity described by Section
33-16 844.104(c)(1).]
33-17 [(c) At any time before the first annuity payment, a
33-18 surviving beneficiary to whom this section applies may, after
33-19 filing a written application with the board of trustees, receive
33-20 payment of the accumulated contributions credited to the account of
33-21 the member in lieu of any benefits otherwise payable under this
33-22 section. If the surviving beneficiary dies before the first
33-23 payment of an annuity allowed under this section, the accumulated
33-24 contributions credited to the account of the member will be paid to
33-25 the estate of the beneficiary.]
33-26 [(d) The governing body of a subdivision may not adopt the
33-27 plan provisions of this section except on the terms provided by
34-1 Subchapter H of this chapter.]
34-2 [(e) The benefit payable under Subsection (b) is payable as
34-3 if the member had retired on the later of December 31, 1993, or the
34-4 last day of the month preceding the month in which death occurred.
34-5 Any benefit payments under this section must begin within one year
34-6 after the later of December 31, 1993, or the last day of the month
34-7 preceding the month in which death occurred. A benefit payable
34-8 under Subsection (b) because of the death of a person who died
34-9 before January 1, 1994, is computed based on the benefit that would
34-10 have been payable if the death had occurred on January 1, 1994.]
34-11 [(f) If a member to whom Subsection (b) would be applicable
34-12 designates the member's estate or more than one but not more than
34-13 three persons to receive payment of the member's accumulated
34-14 contributions if the member dies before becoming eligible to make a
34-15 selection under Section 844.105, 844.106, 844.207, or 844.210, the
34-16 executor or administrator of the estate or, if there is no executor
34-17 or administrator, the surviving beneficiaries may by written notice
34-18 filed with the board elect to receive, in lieu of the accumulated
34-19 deposits, the optional benefit described by Section 844.104(c)(4).
34-20 If the estate is not the beneficiary, the election may only be made
34-21 if all of the beneficiaries agree in writing on the selection of
34-22 the option. If any surviving beneficiary dies before the first
34-23 payment of an annuity allowed under this section, the annuity will
34-24 be paid to those beneficiaries who are still surviving on the date
34-25 of the first payment.]
34-26 [(g) If a member to whom Subsection (b) otherwise would be
34-27 applicable dies without having a valid beneficiary designation on
35-1 file with the retirement system, the member's estate will be
35-2 considered to be the designated beneficiary if the member died
35-3 before becoming eligible to make a selection under Section 844.105,
35-4 844.106, 844.207, or 844.210. The executor or administrator of the
35-5 estate or, if there is no executor or administrator, the persons
35-6 entitled to receive the member's estate may elect to receive, in
35-7 lieu of the accumulated deposits, the optional benefit described by
35-8 Section 844.104(c)(4). The election may be made only by filing
35-9 written notice with the board of trustees together with either a
35-10 certified copy of the court order or an affidavit meeting the
35-11 requirements of Section 137, Texas Probate Code. An election by
35-12 those persons may be made only if all of the persons entitled to
35-13 the member's accumulated contributions agree in writing on the
35-14 selection of the option.]
35-15 SECTION 32. Section 844.210, Government Code, is amended to
35-16 read as follows:
35-17 Sec. 844.210. OPTIONAL BENEFIT ELIGIBILITY PLAN TWO. (a)
35-18 Subject to Subsection (f) [(h)], the governing body of a
35-19 participating subdivision may adopt the plan provisions of this
35-20 section.
35-21 (b) In this section "Section 844.210 credited service" means
35-22 credited service performed for one or more participating
35-23 subdivisions that have adopted the plan provisions of this section.
35-24 (c) A member is eligible[, beginning on the first
35-25 anniversary of the person's membership,] to apply for [retire] and
35-26 receive a service retirement annuity if the member:
35-27 (1) is at least 60 years old and has at least eight
36-1 years of Section 844.210 credited service in the retirement system;
36-2 (2) is less than 60 years old and has sufficient years
36-3 of Section 844.210 credited service in the retirement system that,
36-4 when added to the years of the member's attained age, produces a
36-5 sum equal to or in excess of the number 80; or
36-6 (3) is eligible for service retirement under any other
36-7 provision of this subtitle.
36-8 (d) A member who [If a member] has eight years or more of
36-9 Section 844.210 credited service in the retirement system is a
36-10 vested member for purposes of Sections 844.202, 844.302, and
36-11 844.303[, subsequent absence from service does not terminate
36-12 membership, and unless membership is otherwise terminated, the
36-13 member is eligible to retire and receive a service retirement
36-14 annuity at any time after the member attains the age of 60 years].
36-15 (e) A member who on December 31, 1999, has any Section
36-16 844.210 credited service, whose membership in the retirement system
36-17 continues after that date without interruption, and who accumulates
36-18 four years or more of Section 844.210 credited service is eligible
36-19 to receive a service retirement benefit when the number of years of
36-20 Section 844.210 credited service added to the years of the member's
36-21 attained age equals or exceeds the number 80. For purposes of this
36-22 subsection, Section 844.210 credited service also includes credited
36-23 service performed for one or more subdivisions that have adopted
36-24 the plan provisions of Section 844.207 [An employee of a
36-25 participating subdivision that has adopted the plan provisions of
36-26 this section may select an optional service retirement annuity in
36-27 the manner and under the conditions provided by Section 844.105, if
37-1 the member:]
37-2 [(1) has at least eight years of Section 844.210
37-3 credited service in the retirement system and has attained the age
37-4 of 60 years; or]
37-5 [(2) has at least 20 years of Section 844.210 credited
37-6 service or is otherwise eligible to make a selection of an optional
37-7 service retirement annuity under Section 844.105, 844.106, 844.203,
37-8 844.204, or 844.207.]
37-9 [(f) If a member who is authorized under Subsection (e) to
37-10 select an optional service retirement annuity dies before
37-11 retirement without having made a selection, the member's surviving
37-12 spouse or the executor or administrator of the member's estate may
37-13 make the selection provided by Section 844.105 under the terms of
37-14 that section.]
37-15 [(g) A member who has at least eight years of Section
37-16 844.210 credited service in the retirement system is eligible to
37-17 retire and receive a disability retirement annuity if the member is
37-18 the subject of a certification issued as provided by Section
37-19 844.303(b)(2), except that a member is not eligible to retire for
37-20 disability before the first anniversary of the effective date of
37-21 the person's membership. A member eligible to receive a disability
37-22 retirement annuity under this subsection may, if the member is
37-23 eligible for service retirement, elect to receive a service
37-24 retirement annuity but may not receive both annuities].
37-25 (f) [(h)] The governing body of a subdivision may not adopt
37-26 the plan provisions of this section except on the terms provided by
37-27 Subchapter H [of this chapter].
38-1 SECTION 33. Section 844.211, Government Code, is amended to
38-2 read as follows:
38-3 Sec. 844.211. OPTIONAL BENEFIT ELIGIBILITY PLAN THREE. (a)
38-4 Subject to Subsection (e) [(d)], the governing body of a
38-5 participating subdivision may adopt the plan provisions of this
38-6 section.
38-7 (b) In this section "Section 844.211 credited service" means
38-8 credited service performed for one or more participating
38-9 subdivisions that have adopted the plan provisions of this section.
38-10 (c) A member is eligible[, beginning on the first
38-11 anniversary of the person's membership,] to apply for [retire] and
38-12 receive a service retirement annuity if the member:
38-13 (1) is less than 60 years old and has sufficient years
38-14 of Section 844.211 credited service in the retirement system that,
38-15 when added to the years of the member's attained age, produces a
38-16 sum equal to or in excess of the number 75; or
38-17 (2) is eligible for service retirement under any other
38-18 provision of this subtitle.
38-19 (d) A member who on December 31, 1999, has any Section
38-20 844.211 credited service, whose membership in the retirement system
38-21 continues after that date without interruption, and who accumulates
38-22 four years or more of Section 844.211 credited service is eligible
38-23 to receive a service retirement benefit when the number of years of
38-24 that credited service added to the years of the member's attained
38-25 age equals or exceeds the number 75.
38-26 (e) The governing body of a subdivision may not adopt the
38-27 plan provisions of this section except on the terms provided by
39-1 Subchapter H [of this chapter].
39-2 SECTION 34. Section 844.301(b), Government Code, is amended
39-3 to read as follows:
39-4 (b) An application for a disability retirement annuity must
39-5 be filed on or [not less than 15 days] before the member's
39-6 effective retirement date designated on the application.
39-7 SECTION 35. Section 844.302, Government Code, is amended to
39-8 read as follows:
39-9 Sec. 844.302. ELIGIBILITY FOR DISABILITY RETIREMENT ANNUITY.
39-10 (a) Except as provided by Subsection (c), a member who is not a
39-11 vested member under Section 844.202 [has less than 12 years of
39-12 credited service in the retirement system] is eligible to apply for
39-13 [retire] and receive a disability retirement annuity if the member
39-14 is the subject of a certification issued as provided by Section
39-15 844.303(b)(1).
39-16 (b) Except as provided by Subsection (c), a member who is a
39-17 vested member under Section 844.202 [has at least 12 years of
39-18 credited service in the retirement system] is eligible to apply for
39-19 [retire] and receive a disability retirement annuity if the member
39-20 is the subject of a certification issued as provided by Section
39-21 844.303(b)(2). A member eligible to receive a disability
39-22 retirement annuity under this subsection may, if the member is
39-23 eligible for service retirement, elect to receive a service
39-24 retirement annuity but may not receive both annuities.
39-25 (c) A member is not eligible to retire for disability before
39-26 the first anniversary of the earlier of the effective date of the
39-27 person's membership or the effective date of participation of the
40-1 subdivision from which the member had most recently earned credited
40-2 service.
40-3 SECTION 36. Section 844.303(b), Government Code, is amended
40-4 to read as follows:
40-5 (b) The medical board shall issue a certification of
40-6 disability and submit it to the board of trustees, if the medical
40-7 board finds:
40-8 (1) in the case of a member who is not a vested member
40-9 under Section 844.202 [has less than 12 years of credited service
40-10 in the retirement system], that:
40-11 (A) the member is mentally or physically
40-12 incapacitated for any gainful occupation;
40-13 (B) the incapacity is the direct result of
40-14 injuries sustained during membership by external and violent means
40-15 as a direct and proximate result of the performance of duty;
40-16 (C) the incapacity is likely to be permanent;
40-17 and
40-18 (D) the member should be retired; or
40-19 (2) in the case of a member who is a vested member
40-20 under Section 844.202 [has at least 12 years of credited service in
40-21 the retirement system], that:
40-22 (A) the member is mentally or physically
40-23 incapacitated for any gainful occupation;
40-24 (B) the incapacity is likely to be permanent;
40-25 and
40-26 (C) the member should be retired.
40-27 SECTION 37. Section 844.305(h), Government Code, is amended
41-1 to read as follows:
41-2 (h) A retiree who dies before the 31st day after the
41-3 effective date of disability retirement and who did not select an
41-4 optional disability retirement annuity before death is considered
41-5 to have selected an optional annuity under Subsection (c)(7)
41-6 [(c)(4)]. Alternatively, the decedent's beneficiary may elect to
41-7 receive a refund of the decedent's accumulated contributions under
41-8 Section 844.401, in which case the decedent will be considered to
41-9 have been a contributing member at the time of death.
41-10 SECTION 38. Subchapter E, Chapter 844, Government Code, is
41-11 amended by adding Section 844.407 to read as follows:
41-12 Sec. 844.407. SURVIVOR ANNUITY DEATH BENEFIT. (a) In this
41-13 section "eligible member" means:
41-14 (1) a member who has four or more years of credited
41-15 service with one or more subdivisions that on September 1, 1999,
41-16 are participating in the retirement system or that begin
41-17 participation in the system after that date;
41-18 (2) a member who has 20 or more years of credited
41-19 service with one or more subdivisions participating in the system;
41-20 (3) a member who is at least 60 years of age and has
41-21 12 or more years of credited service with one or more subdivisions
41-22 participating in the system;
41-23 (4) a member who is at least 60 years of age and has
41-24 10 or more years of Section 844.207 credited service; or
41-25 (5) a member who is at least 60 years of age and has
41-26 eight or more years of Section 844.210 credited service.
41-27 (b) An annuity described by this section may be selected and
42-1 paid on the death of an eligible member before the effective date
42-2 of the member's retirement instead of any other benefit allowed
42-3 under this subtitle, except that a supplemental death benefit under
42-4 Subchapter F may also be paid.
42-5 (c) An eligible member may, before the effective date of the
42-6 member's retirement, file with the board of trustees on a form
42-7 prescribed by the board, a selection of an optional service
42-8 retirement annuity available under Section 844.104 and a
42-9 designation of beneficiary.
42-10 (d) A member who is entitled under this section to select
42-11 one of the optional service retirement annuities authorized by
42-12 Section 844.104 may elect instead to name a beneficiary who, on the
42-13 death of the member before retirement, will be allowed to choose
42-14 any benefit that the member could have chosen to be paid to the
42-15 beneficiary, with like effect as if the selection had been made by
42-16 the member.
42-17 (e) An unrevoked application for deferred service retirement
42-18 executed and filed by the member with the retirement system before
42-19 December 31, 1999, shall be considered a selection of benefit and a
42-20 designation of beneficiary under Subsection (c). If no application
42-21 is on file on that date, an unrevoked form executed by the member
42-22 and filed with the system naming a beneficiary to whom the member's
42-23 accumulated deposits are to be paid in the event of death before
42-24 retirement shall be considered a selection of a beneficiary under
42-25 Subsection (d).
42-26 (f) A member may change a selection of an optional annuity
42-27 or a designation of beneficiary at any time before the member's
43-1 retirement or death in the same manner that the original selection
43-2 or designation was made.
43-3 (g) If an eligible member dies before retirement without
43-4 having made a selection under Subsection (c), (d), or (e), the
43-5 member's surviving spouse is considered to be the beneficiary and
43-6 may select an optional annuity in the same manner as if the member
43-7 had made the selection.
43-8 (h) If no surviving spouse exists, the executor or
43-9 administrator of the member's estate may elect:
43-10 (1) for an estate beneficiary to receive the optional
43-11 annuity under Section 844.104(c)(7); or
43-12 (2) for the estate to receive a refund of the member's
43-13 accumulated contributions under Section 844.401.
43-14 (i) Any annuity payable under this section shall be computed
43-15 on the assumption that the member had actually retired under the
43-16 annuity selected and with the same beneficiary determined under the
43-17 applicable provision of this section, effective on the last day of
43-18 the calendar month before the month in which death of the member
43-19 occurred.
43-20 (j) A survivor annuity under this section shall be paid from
43-21 the same accounts and is subject to the same conditions as are
43-22 applicable to a service retirement benefit for the same member.
43-23 SECTION 39. Subchapter E, Chapter 844, Government Code, is
43-24 amended by adding Section 844.408 to read as follows:
43-25 Sec. 844.408. NO SURVIVING SPOUSE, EXECUTOR, OR
43-26 ADMINISTRATOR. (a) In this section "heirs" has the meaning
43-27 assigned by Section 3, Texas Probate Code, except that the term
44-1 excludes any person who has filed a proper disclaimer or
44-2 renunciation with the retirement system.
44-3 (b) If a surviving spouse or the executor or administrator
44-4 of a deceased member's estate would be entitled to make an election
44-5 under Section 842.110(f) or 842.111(c), or if a beneficiary or the
44-6 executor or administrator of a deceased member's estate would be
44-7 entitled to make an election under Section 844.407 because of the
44-8 death of the member, the heirs of the deceased member may make that
44-9 election if:
44-10 (1) no surviving spouse exists, or, if Section 844.407
44-11 is applicable, no surviving beneficiary exists;
44-12 (2) no petition for the appointment of a personal
44-13 representative of the member is pending or has been granted;
44-14 (3) 30 days have elapsed since the date of death of
44-15 the member;
44-16 (4) the value of the entire assets of the member's
44-17 estate, excluding homestead and exempt property, does not exceed
44-18 $50,000; and
44-19 (5) on file with the retirement system is a certified
44-20 copy of a small estates affidavit that has been approved and filed
44-21 in accordance with Section 137, Texas Probate Code, or an original
44-22 affidavit described by Subsection (c).
44-23 (c) If no affidavit has been filed with the clerk of the
44-24 court having jurisdiction and venue as provided by Section 137,
44-25 Texas Probate Code, the retirement system may accept instead an
44-26 affidavit sworn to by two disinterested witnesses and by those
44-27 heirs who have legal capacity and, if the facts warrant, by the
45-1 natural guardian or next of kin of any minor or incompetent who is
45-2 also an heir. The affidavit must include the names and addresses
45-3 of the heirs and witnesses, establish the facts listed in
45-4 Subsection (b), include a list of the assets and liabilities of the
45-5 estate, show the facts that constitute the basis for the right of
45-6 the heirs to receive the estate, and show the fractional interests
45-7 of the heirs in the estate as a result of those facts.
45-8 (d) If the retirement system, acting through the director or
45-9 a person designated by the director, approves the affidavit, the
45-10 heirs may make the election if each heir agrees to it.
45-11 SECTION 40. Sections 844.502(a), (b), (c), and (d),
45-12 Government Code, are amended to read as follows:
45-13 (a) A member included in the coverage of the supplemental
45-14 death benefit program who fails to earn compensation in a month for
45-15 service to a subdivision participating in the supplemental death
45-16 benefits fund may be [is] eligible to receive extended coverage in
45-17 the program under [on complying with the terms of] this section.
45-18 (b) A member who dies within 24 months after the date the
45-19 member last made a required contribution to the retirement system
45-20 is considered to have received [is entitled to receive] extended
45-21 program coverage if the retirement system receives at its office
45-22 after the member's death:
45-23 (1) evidence that the retirement system considers
45-24 satisfactory to establish [notification] that, as a result of
45-25 illness or injury, the member was [is] unable to engage in gainful
45-26 employment throughout the period beginning with the date of the
45-27 last required contribution and ending on the date of death; [or is
46-1 on leave of absence under the Family and Medical Leave Act of 1993
46-2 (Pub. L. 103-3); and]
46-3 (2) a statement from the subdivision, on a form
46-4 approved by the board of trustees, that the member was on leave of
46-5 absence under the Family and Medical Leave Act of 1993 (Pub. L.
46-6 103-3) throughout the period beginning with the date of the last
46-7 required contribution and ending on the date of death; or
46-8 (3) a statement from the subdivision, on a form
46-9 approved by the board of trustees, that the member was on leave of
46-10 absence under the Family and Medical Leave Act of 1993 (Pub. L.
46-11 103-3) during part of the period beginning with the date of the
46-12 last required contribution and ending on the date of death, with
46-13 evidence that the retirement system considers satisfactory to
46-14 establish that, throughout the rest of the period, the member was
46-15 unable to engage in gainful employment as a result of illness or
46-16 injury [evidence that the member made a required contribution to
46-17 the retirement system as an employee of a subdivision participating
46-18 in the supplemental death benefits fund for the month immediately
46-19 preceding the first full month in which the member was unable to
46-20 engage in gainful employment].
46-21 (c) A member who had applied for and received extended
46-22 program coverage before September 1, 1999, remains covered by [The
46-23 retirement system may request additional evidence as to illness or
46-24 injury or of the required contribution as a condition to granting
46-25 the coverage.]
46-26 [(d) Once established, extended coverage of a person in] the
46-27 supplemental death benefit program [continues] until the last day
47-1 of the month in which:
47-2 (1) the member returns to work as an employee of a
47-3 participating subdivision;
47-4 (2) the member becomes able to engage in gainful
47-5 employment;
47-6 (3) the person's membership in the retirement system
47-7 is terminated;
47-8 (4) the member retires under this subtitle; or
47-9 (5) the member's leave of absence under the Family and
47-10 Medical Leave Act of 1993 (Pub. L. 103-3) terminates.
47-11 SECTION 41. Section 844.505, Government Code, is amended to
47-12 read as follows:
47-13 Sec. 844.505. BENEFICIARY OF SUPPLEMENTAL DEATH BENEFIT.
47-14 (a) Unless a member has directed otherwise on a form prescribed by
47-15 the board of trustees and filed with the retirement system:
47-16 (1) a supplemental death benefit under Section 844.503
47-17 is payable to the person entitled to receive the decedent's
47-18 accumulated contributions, unless the decedent was eligible under
47-19 Section 844.407 [844.105] to select an optional service retirement
47-20 annuity, in which case the benefit is payable to the beneficiary
47-21 designated by the decedent or, if no designation was made, to the
47-22 person entitled under that section to receive an optional annuity;
47-23 and
47-24 (2) a supplemental death benefit under Section 844.504
47-25 is payable to a person entitled to receive any remaining payments
47-26 of the decedent's annuity.
47-27 (b) If a person entitled under this section to receive a
48-1 supplemental death benefit does not survive the member or retiree
48-2 covered by the supplemental death benefit program, the benefit is
48-3 payable to the person to whom a benefit under Subchapter B or D is
48-4 payable, or if no benefit is payable under those subchapters, to
48-5 the person to whom a benefit under Subchapter E is or would be
48-6 payable [estate of the covered member or retiree].
48-7 SECTION 42. Sections 844.605(b) and (c), Government Code,
48-8 are amended to read as follows:
48-9 (b) A supplemental contribution rate is the rate of
48-10 contribution by a subdivision to its account in the subdivision
48-11 accumulation fund, in addition to the contributions provided under
48-12 Section 845.404(a)(2), that the actuary determines and certifies is
48-13 required, together with the contributions provided under Section
48-14 845.404(a)(2), to amortize the obligations of the subdivision to
48-15 the subdivision accumulation fund within a period of 25 years. A
48-16 supplemental contribution rate may [not] exceed the rate determined
48-17 by the actuary [four percent of covered payroll].
48-18 (c) A supplemental contribution rate adopted by a
48-19 participating subdivision may not be increased unless the actuary
48-20 subsequently makes the determination described by Subsection (a).
48-21 If the actuary subsequently makes the determination specified by
48-22 this subsection, the governing body of the subdivision may adopt
48-23 another supplemental contribution rate under this section.
48-24 SECTION 43. Section 844.606, Government Code, is amended by
48-25 adding Subsection (f) to read as follows:
48-26 (f) The lower percentage to be used in determining multiple
48-27 matching credits provided for by Subsection (b) must be a multiple
49-1 of 10 percent of the amount of member contributions.
49-2 SECTION 44. Section 844.608(a), Government Code, is amended
49-3 to read as follows:
49-4 (a) Notwithstanding Section 845.402(c) [Sections 845.402(c)
49-5 and (d)], a subdivision's member contribution rate may be reduced
49-6 to one, two, three, four, five, or six percent of the current
49-7 service compensation of its employees, except that the rate of
49-8 member contributions may be reduced to less than four percent only
49-9 if the reduction is necessary under this section.
49-10 SECTION 45. Section 844.702, Government Code, is amended to
49-11 read as follows:
49-12 Sec. 844.702. MEMBER CONTRIBUTIONS. (a) The governing body
49-13 of the subdivision may designate the rate of member contributions
49-14 for employees of the subdivision to take effect beginning on the
49-15 effective date of adoption of the plan provisions of this
49-16 subchapter. The subdivision may elect a rate of four, five, six,
49-17 or seven percent of the current service compensation of its
49-18 employees. The governing body of the subdivision may thereafter
49-19 increase or decrease the contribution rate to take effect on the
49-20 next January 1 after the date of adoption of the increase or
49-21 decrease, in accordance with [notwithstanding] the provisions of
49-22 Sections 845.402(b) and (c) [845.402(c) and (d)].
49-23 (b) If necessary under Section [844.608(b) or] 844.703(h), a
49-24 subdivision's member contribution rate may be reduced to one, two,
49-25 three, four, five, or six percent of the current service
49-26 compensation of its employees.
49-27 SECTION 46. Sections 844.703(c), (d), (g), and (h),
50-1 Government Code, are amended to read as follows:
50-2 (c) The combined rates of a subdivision's normal
50-3 contributions and prior service contributions under this subchapter
50-4 may not exceed 11 percent unless the governing body of the
50-5 subdivision elects to waive this limitation. A waiver under this
50-6 subsection becomes effective on January 1 of the year after the
50-7 year in which it is adopted and remains effective until January 1
50-8 of the year following a repeal of the waiver by the subdivision's
50-9 governing body.
50-10 (d) The actuary annually shall determine the subdivision
50-11 normal contribution rate and the prior service contribution rate
50-12 for subdivisions adopting the plan provisions of this subchapter
50-13 from the most recent data available at the time of determination.
50-14 Before January 1 of each year, the board of trustees shall certify
50-15 the rates of each subdivision that has adopted the plan provisions
50-16 of this subchapter. If the combined rates of the subdivision's
50-17 normal contributions and prior service contributions under this
50-18 subchapter exceed the rate prescribed by Subsection (c), and if the
50-19 governing body of the subdivision has not waived that maximum rate,
50-20 the rate for prior service contributions must be reduced to the
50-21 rate that equals the difference between the maximum rate prescribed
50-22 by Subsection (c) and the normal contribution rate. The governing
50-23 body may elect to contribute at a rate that is an integer percent
50-24 but not more than the maximum rate prescribed by Subsection (c),
50-25 unless the governing body has elected to waive that maximum rate,
50-26 if that elected rate exceeds the sum of the subdivision's normal
50-27 contribution rate and its prior service contribution rate as
51-1 determined under Subsections (a) and (b). This elected rate
51-2 remains in effect for each subsequent calendar year until it is
51-3 rescinded by the governing body or until the sum of the rates
51-4 determined under Subsections (a) and (b) exceeds the elected rate,
51-5 at which time the governing body must contribute the sum of the
51-6 rates determined under Subsections (a) and (b). For years in which
51-7 the elected rate exceeds the sum of the rates determined under
51-8 Subsections (a) and (b), the prior service contribution rate is
51-9 increased to the rate that equals the difference between the
51-10 elected rate and the normal contribution rate prescribed by
51-11 Subsection (a).
51-12 (g) If the combined rates of the subdivision's normal
51-13 contributions and prior service contributions under this subchapter
51-14 exceed the maximum rate prescribed by Subsection (c) before the
51-15 adjustment prescribed by Subsection (d), and if the governing body
51-16 of the subdivision has not waived that maximum rate, the actuary
51-17 shall determine what lower percentage for determining multiple
51-18 matching credits of future member contributions is necessary to
51-19 make the combined rates of the subdivision not exceed the maximum
51-20 rate prescribed by Subsection (c). The actuary shall give written
51-21 notice of the determination to the director, who shall give written
51-22 notice to the governing body of the subdivision. The lower
51-23 percentage determined by the actuary and specified in the notice to
51-24 the governing body becomes effective as to all members who perform
51-25 current service for the affected subdivision on or after the first
51-26 day of the first calendar year that begins after the date of the
51-27 notice, unless before the effective date, the governing body of the
52-1 subdivision adopts an order or resolution, approved by the board of
52-2 trustees, authorizing a reduction in the percentage used in
52-3 determining multiple matching credits in accordance with Section
52-4 844.704(a) or authorizing a reduction in the rate of member
52-5 contributions in accordance with Section 844.702, or authorizing
52-6 both a reduction in the percentage used in determining multiple
52-7 matching credits and a reduction in the rate of member
52-8 contributions.
52-9 (h) If the combined rates of the subdivision's normal
52-10 contributions and prior service contributions under this subchapter
52-11 exceed the maximum rate prescribed by Subsection (c), and if the
52-12 governing body of the subdivision has not waived that maximum rate,
52-13 and if all reductions under Subsection (g), in the opinion of the
52-14 actuary, result in the combined rates of the subdivision remaining
52-15 in excess of the maximum rate prescribed by Subsection (c), the
52-16 retirement system shall reduce the rate of member contributions to
52-17 a lower rate authorized by Section 844.702 that, in the opinion of
52-18 the actuary, is required to produce a combined rate that does not
52-19 exceed the rate prescribed by Subsection (c). At the time the
52-20 actuary determines that the rate of employee contributions that was
52-21 in existence before a reduction under this subsection no longer
52-22 would result in a combined rate in excess of the maximum rate
52-23 prescribed by Subsection (c), the retirement system shall reinstate
52-24 the employee contribution to the rate that was in effect at the
52-25 time of the reduction, unless the governing body of the subdivision
52-26 has elected to change to some other rate authorized by Section
52-27 844.702(a). Any change under this section shall be made on January
53-1 1 of the year following the applicable determination by the
53-2 actuary. During the time that the member contribution rate is
53-3 reduced, the combined rates of the subdivision's normal
53-4 contributions and prior service contributions shall be equal to the
53-5 maximum rate prescribed by Subsection 844.703(c).
53-6 SECTION 47. Sections 844.704(c), (d), and (e), Government
53-7 Code, are amended to read as follows:
53-8 (c) By adopting the plan provisions of this subchapter, the
53-9 governing body also adopts the optional benefit eligibility plan
53-10 described by Section 844.207 unless by its order it adopts the
53-11 optional benefit eligibility plan described by Section 844.210 and
53-12 the survivor annuity death benefit described by Section 844.407.
53-13 (d) The governing body of a subdivision that has adopted or
53-14 is adopting the plan provisions of this subchapter may adopt:
53-15 (1) the alternative optional increase in retirement
53-16 annuities [benefit for a surviving beneficiary of a vested member]
53-17 under Section 844.209;
53-18 (2) the optional increase in retirement annuities
53-19 under Section 844.208;
53-20 (3) the optional authorization of the reestablishment
53-21 of credited service previously forfeited under Section 843.003;
53-22 (4) the optional authorization of the establishment of
53-23 credited service for military service under Section 843.601(c)
53-24 [843.202 or 843.601, notwithstanding the limitation related to
53-25 Section 844.201 in Section 843.202(d) and 843.601(a)];
53-26 (5) the optional authorization of the establishment of
53-27 premembership credited service for overage employees under Section
54-1 843.204 [election to have credits recomputed on the basis of total
54-2 compensation under Section 843.702];
54-3 (6) the optional benefit eligibility plan described by
54-4 Section 844.210; or
54-5 (7) the optional benefit eligibility plan described by
54-6 Section 844.211.
54-7 (e) The governing body may not adopt the benefits of this
54-8 section if the adoption would result in the combined rates of the
54-9 subdivision's normal contributions and prior service contributions
54-10 for the first calendar year following the adoption exceeding the
54-11 maximum rate prescribed by Section 844.703(c) unless a waiver under
54-12 that section is in effect.
54-13 SECTION 48. Section 845.105, Government Code, is amended to
54-14 read as follows:
54-15 Sec. 845.105. INDEBTEDNESS; PAYMENT. (a) The board of
54-16 trustees may:
54-17 (1) incur indebtedness;
54-18 (2) on the credit of the retirement system, borrow
54-19 money to pay expenses incident to the system's operation;
54-20 (3) renew, extend, or refund its indebtedness; or
54-21 (4) issue and sell negotiable promissory notes or
54-22 negotiable bonds of the system.
54-23 (b) A note or bond issued under this section must [mature
54-24 before the 20th anniversary of the issuance of the note or bond.
54-25 The rate of interest on the note or bond may not exceed six percent
54-26 a year.]
54-27 [(c) The board shall charge a note or bond issued under this
55-1 section against the system's expense fund and shall pay the note or
55-2 bond from that fund. The total indebtedness against the expense
55-3 fund may not exceed $100,000 at any time.]
55-4 [(d) A note or bond issued under this section must]
55-5 expressly state that the note or bond is not an obligation of this
55-6 state.
55-7 SECTION 49. Subchapter B, Chapter 845, Government Code, is
55-8 amended by adding Section 845.116 to read as follows:
55-9 Sec. 845.116. ELECTRONIC TRANSFER OF FUNDS AND ELECTRONIC
55-10 FILING OF DOCUMENTS. (a) In this section:
55-11 (1) "Electronic filing" means the filing of data
55-12 transmitted to the retirement system by the communication of
55-13 information by facsimile or in the form of digital electronic
55-14 signals transformed by computer and stored on microfilm, magnetic
55-15 tape, optical disks, or any other medium.
55-16 (2) "Electronic transfer" means any transfer of funds,
55-17 other than a transaction originated by check, draft, or similar
55-18 paper instrument, that is initiated through an electronic terminal,
55-19 telephone instrument, computer, or magnetic media to order,
55-20 instruct, or authorize a financial institution to debit or credit
55-21 an account.
55-22 (b) The board of trustees may adopt rules and procedures
55-23 relating to the electronic transfer of funds and the electronic
55-24 filing of documents and required reports.
55-25 (c) Funds that are electronically transferred in accordance
55-26 with those rules and procedures are considered to have been timely
55-27 received by the retirement system. Documents and required reports
56-1 that are electronically filed in accordance with those rules and
56-2 procedures are considered to have been properly filed with the
56-3 retirement system.
56-4 SECTION 50. Section 845.306, Government Code, is amended to
56-5 read as follows:
56-6 Sec. 845.306. EMPLOYEES SAVING FUND. (a) The retirement
56-7 system shall deposit in a member's individual account in the
56-8 employees saving fund:
56-9 (1) the amount of contributions to the retirement
56-10 system deducted from the member's compensation;
56-11 (2) interest allowed on money in the account in
56-12 accordance with this subtitle;
56-13 (3) [an amount deposited by a member in accordance
56-14 with Section 845.405 to establish credited service during a time of
56-15 war;]
56-16 [(4)] the portion of a deposit required by Section
56-17 843.003 [or 843.404] to reinstate credited service previously
56-18 terminated that represents the amount withdrawn;
56-19 (4) [(5)] the amount deposited in accordance with
56-20 Section 843.301(b) or 843.402(b) to establish credit for prior or
56-21 current service for a person who became a member in accordance with
56-22 Subchapter C, [of] Chapter 842;
56-23 (5) [(6)] the amount, if any, deposited by a member in
56-24 accordance with Section 843.601(b) [843.601(e)] to establish
56-25 current service credit for military service;
56-26 [(7) the amount deposited by a member in accordance
56-27 with Section 843.501 to establish credit for legislative service;]
57-1 and
57-2 (6) [(8)] the amount deposited by a person to become a
57-3 member in accordance with Section 842.103.
57-4 (b) On December 31 of each year, the retirement system shall
57-5 credit to each member's individual account interest as allowed by
57-6 this subtitle on the amount of accumulated deposits credited to the
57-7 member's account on January 1 of that year.
57-8 [(c) The retirement system may not pay interest on money in
57-9 a person's individual account:]
57-10 [(1) for a part of a year; or]
57-11 [(2) after the person's membership has been terminated
57-12 in accordance with Section 842.109 because of absence from
57-13 service.]
57-14 SECTION 51. Section 845.307(a), Government Code, is amended
57-15 to read as follows:
57-16 (a) The retirement system shall deposit in the account of a
57-17 participating subdivision in the subdivision accumulation fund:
57-18 (1) all benefit contributions made by the subdivision
57-19 to the system pursuant to Section 845.404(a)(2);
57-20 (2) income [and interest] allocated to the fund as
57-21 provided by this subtitle;
57-22 (3) amounts deposited by the subdivision under Section
57-23 845.408 [in accordance with former Section 845.405 to establish
57-24 credited service during a time of war];
57-25 (4) the withdrawal charge for reinstatement of
57-26 credited service as provided by Section 843.003 [or 843.404];
57-27 (5) the amount of matching contributions made by a
58-1 subdivision in accordance with Section 843.301(c) or 843.402(c) to
58-2 establish credit for prior or current service for a person who
58-3 became a member in accordance with Subchapter C, [of] Chapter 842;
58-4 [(6) the amount of matching contributions made by a
58-5 subdivision in accordance with Section 843.601(f) to establish
58-6 current service credit for military service;]
58-7 [(7) the amount of matching contributions made by a
58-8 subdivision in accordance with Section 843.501 to establish credit
58-9 for legislative service;] and
58-10 (6) [(8)] the amount deposited by a subdivision for a
58-11 person to become a member in accordance with Section 842.103.
58-12 SECTION 52. Section 845.310(f), Government Code, is amended
58-13 to read as follows:
58-14 (f) The retirement system shall deposit and hold in the
58-15 perpetual endowment account funds, gifts, and awards that the
58-16 grantors designate as perpetual endowment for the retirement system
58-17 and money forfeited to the retirement system as provided by Section
58-18 845.505 [845.503].
58-19 SECTION 53. Section 845.312, Government Code, is amended to
58-20 read as follows:
58-21 Sec. 845.312. SUPPLEMENTAL DEATH BENEFITS FUND. (a) The
58-22 retirement system shall deposit in the supplemental death benefits
58-23 fund contributions paid by subdivisions to the retirement system to
58-24 provide supplemental death benefits in accordance with Section
58-25 845.406. The retirement system may not establish separate accounts
58-26 in the fund for subdivisions participating in the fund but shall
58-27 credit contributions to a single account.
59-1 (b) The retirement system shall pay supplemental death
59-2 benefits only from money in the supplemental death benefits fund,
59-3 and the benefits are not an obligation of other funds of the
59-4 system.
59-5 (c) [The supplemental death benefits fund may become
59-6 operative only after a sufficient number of subdivisions elect to
59-7 participate in the fund so that 4,000 members or more are covered
59-8 by the fund.]
59-9 [(d) The board of trustees shall determine the operative
59-10 date of the fund.]
59-11 [(e)] The effective participation date of a subdivision is[:]
59-12 [(1) the operative date of the fund if the subdivision
59-13 elected to participate in the fund on or before the fund's
59-14 operative date; or]
59-15 [(2)] the first day of any calendar month after the
59-16 month in which the subdivision notifies the board of its election
59-17 to enter the fund.
59-18 [(f) The board of trustees shall notify each subdivision of
59-19 its effective participation date.]
59-20 SECTION 54. Section 845.315(b), Government Code, is amended
59-21 to read as follows:
59-22 (b) The account of each subdivision, other than a
59-23 subdivision that has ceased participation according to Section
59-24 845.317(a), will receive a share of the amount transferred under
59-25 Subsection (a)(5) that is in proportion to the amount that the
59-26 balance credited to its account on January 1 bears to the total
59-27 credited to the subdivision accumulation fund on that date.
60-1 SECTION 55. The heading of Subchapter E, Chapter 845,
60-2 Government Code, is amended to read as follows:
60-3 SUBCHAPTER E. COLLECTION OF [MEMBERSHIP FEES AND]
60-4 CONTRIBUTIONS
60-5 SECTION 56. Section 845.403(j), Government Code, is amended
60-6 to read as follows:
60-7 (j) Contributions picked up as provided by Subsection (i)
60-8 shall be treated as employer contributions in determining tax
60-9 treatment of the amounts under Section 414(h) of the United States
60-10 Internal Revenue Code of 1986 [; however, each participating
60-11 subdivision shall continue to withhold federal income taxes based
60-12 upon these contributions until the Internal Revenue Service
60-13 determines or the federal courts rule that pursuant to Section
60-14 414(h) of the Internal Revenue Code of 1986 (26 U.S.C. Section
60-15 414), these picked-up contributions are not included as gross
60-16 income of the employee until such time as they are distributed or
60-17 made available]. Each employee contribution that is picked up as
60-18 above provided shall be deposited as provided in Section 845.306 to
60-19 the individual account of the member, on whose behalf they are
60-20 made, and shall be treated for all other purposes of this subtitle
60-21 in the same manner and with like effect as if the amount had been
60-22 deducted from the compensation of and made by the employee pursuant
60-23 to Sections 845.402 and 845.403(a) through (h).
60-24 SECTION 57. Section 845.404(a), Government Code, is amended
60-25 to read as follows:
60-26 (a) Before the 16th day of each month, each participating
60-27 subdivision shall pay or cause to be paid to the retirement system
61-1 at the system's office:
61-2 (1) the member contributions, or "picked-up" member
61-3 contributions, provided for by Sections 845.402 and 845.403, which
61-4 shall be deposited to the individual accounts of the members; and
61-5 (2) the contributions that a subdivision is required
61-6 to make under this subtitle, which [an additional amount equal to
61-7 the total of contributions made by or on behalf of employees of the
61-8 subdivision under the provisions of Sections 845.402 and 845.403
61-9 for the preceding month, which additional amount] shall be
61-10 deposited to the account of the subdivision in the subdivision
61-11 accumulation fund.
61-12 SECTION 58. Section 845.406, Government Code, is amended to
61-13 read as follows:
61-14 Sec. 845.406. SUPPLEMENTAL DEATH BENEFITS PROGRAMS. (a) In
61-15 addition to other contributions to the retirement system required
61-16 by this subtitle, each subdivision participating in the
61-17 supplemental death benefits fund monthly shall pay to the fund an
61-18 amount equal to the rate of contribution computed in accordance
61-19 with this section, multiplied by the total compensation for the
61-20 month of the members employed by the subdivision.
61-21 (b) A limitation on subdivision contribution rates provided
61-22 by this subtitle does not apply to the rate of the contribution to
61-23 the supplemental death benefits fund.
61-24 (c) At [As soon as practical after the supplemental death
61-25 benefits program is established and at] the time of each
61-26 investigation of members' mortality and service experience required
61-27 by Section 845.110, the actuary shall investigate the mortality
62-1 experience of the members and eligible annuitants participating in
62-2 the supplemental death benefits program. On the basis of the
62-3 result of that investigation, the actuary shall recommend to the
62-4 board of trustees rates and tables necessary to determine
62-5 supplemental death benefits contribution rates. The rates and
62-6 tables may provide for the anticipated mortality experience of the
62-7 persons covered under the supplemental death benefits fund and for
62-8 a contingency reserve.
62-9 (d) Before a subdivision's participation date in the
62-10 supplemental death benefits fund and before January 1 of each
62-11 subsequent year, the actuary shall compute, on the basis of rates
62-12 and tables adopted by the board of trustees, the supplemental death
62-13 benefits contribution rate of a subdivision participating in the
62-14 supplemental death benefits contribution fund. The rate must be
62-15 expressed as a percentage of the compensation of members employed
62-16 by the subdivision. When the rate is approved by the board of
62-17 trustees, the rate is effective for the calendar year for which it
62-18 was approved.
62-19 (e) The board of trustees, in the exercise of its discretion
62-20 to manage the assets of the retirement system, may lend money to
62-21 the supplemental death benefits fund if the amount in the fund is
62-22 insufficient to pay the supplemental death benefits due. Any loan
62-23 is an investment of the retirement system and must be repaid solely
62-24 from future contributions to the supplemental death benefits fund
62-25 and its share of trust earnings. The terms of the loan shall be
62-26 set by the board of trustees, but the loan must bear a commercially
62-27 reasonable interest rate. The board may adjust future
63-1 contributions to the supplemental death benefits fund for purposes
63-2 of repayment of the loan [If the balance in the supplemental death
63-3 benefits fund is insufficient to pay the supplemental death
63-4 benefits due, the board of trustees may direct that, to the extent
63-5 available, an amount equal to the amount of the deficiency be
63-6 transferred from the general reserves account of the endowment fund
63-7 to the supplemental death benefits fund. The board may adjust
63-8 future contributions to the supplemental death benefits fund to
63-9 repay to the general reserves account the transferred amount].
63-10 (f) [If the total number of members covered by the
63-11 supplemental death benefits fund becomes fewer than 4,000, the
63-12 board of trustees may order that the fund be discontinued and all
63-13 coverage terminated. The termination date must be December 31 of a
63-14 year designated by the board and may not be before the expiration
63-15 of six months after the date on which the order of termination was
63-16 adopted.]
63-17 [(g)] To protect against adverse claim experience, the board
63-18 of trustees may secure reinsurance from one or more stock insurance
63-19 companies doing business in this state if the board determines that
63-20 reinsurance is necessary. The retirement system shall pay the
63-21 premiums for reinsurance from the supplemental death benefits fund.
63-22 SECTION 59. Subchapter E, Chapter 845, Government Code, is
63-23 amended by adding Section 845.407 to read as follows:
63-24 Sec. 845.407. PENALTY FOR LATE CONTRIBUTIONS. (a) A
63-25 participating subdivision that fails to provide the information
63-26 required by Section 845.403 or to pay all contributions required by
63-27 this subchapter to be made and remitted to the retirement system
64-1 before the 16th day of the month in which they are due shall pay a
64-2 penalty under this section. The penalty for a past-due monthly
64-3 remission is equal to interest on the past-due amounts for each day
64-4 past due at a nominal interest rate of 12 percent, plus a $500
64-5 administrative fee. If the penalty is not paid within three months
64-6 after the date notice of the penalty has been sent to the
64-7 subdivision, the retirement system shall deduct the penalty from
64-8 the subdivision's account in the subdivision accumulation fund. The
64-9 interest portion of the penalty shall be deposited by the
64-10 retirement system in the distributable income account of the
64-11 interest fund. The administrative fee portion of the penalty shall
64-12 be deposited by the retirement system in the expense fund.
64-13 (b) Payment and required reports are considered to be made
64-14 when received by the retirement system.
64-15 SECTION 60. Subchapter E, Chapter 845, Government Code, is
64-16 amended by adding Section 845.408 to read as follows:
64-17 Sec. 845.408. ADDITIONAL OPTIONAL DEPOSITS BY SUBDIVISIONS.
64-18 In addition to the deposits that a subdivision is required to make
64-19 under this subtitle, the governing body of a participating
64-20 subdivision may elect to deposit to the subdivision's account in
64-21 the subdivision accumulation fund one or more lump-sum payments.
64-22 Once a payment is deposited, it cannot be withdrawn from that fund
64-23 by the subdivision.
64-24 SECTION 61. Section 845.505(e), Government Code, is amended
64-25 to read as follows:
64-26 (e) If a person files with the retirement system a valid
64-27 application for retirement based on an account that has been closed
65-1 under Subsection (a)[, (b),] or (c), the retirement system shall
65-2 restore the member's individual account in the employees saving
65-3 fund and pay a retirement annuity computed as of the date on which
65-4 the annuity would have been required to begin under this subtitle.
65-5 All annuity payments that previously would have been paid if the
65-6 annuity had begun on the date required under this subtitle will be
65-7 paid to the person as a single sum.
65-8 SECTION 62. Notwithstanding Section 844.407, Government
65-9 Code, as added by this Act, a subdivision participating in the
65-10 Texas County and District Retirement System that is not subject to
65-11 Subchapter H, Chapter 844, Government Code, may before December 31,
65-12 1999, elect not to be subject to Section 844.407 by filing a notice
65-13 of that election with the retirement system before that date. A
65-14 subdivision that makes an election under this section may
65-15 subsequently elect to be subject to Section 844.407, Government
65-16 Code, as added by this Act.
65-17 SECTION 63. The following provisions of the Government Code
65-18 are repealed:
65-19 (1) Section 842.005;
65-20 (2) Section 843.202;
65-21 (3) Section 843.404;
65-22 (4) Section 843.603;
65-23 (5) Section 843.702;
65-24 (6) Sections 844.007(d), (e), (f), and (g);
65-25 (7) Section 844.105;
65-26 (8) Section 844.106;
65-27 (9) Section 844.107;
66-1 (10) Section 844.108;
66-2 (11) Section 844.201;
66-3 (12) Section 844.203;
66-4 (13) Section 844.204;
66-5 (14) Section 844.205;
66-6 (15) Section 844.206; and
66-7 (16) Sections 844.502(e) and (f).
66-8 SECTION 64. This Act takes effect December 31, 1999, except
66-9 Sections 13, 16, 62, and this section, which take effect September
66-10 1, 1999.
66-11 SECTION 65. The importance of this legislation and the
66-12 crowded condition of the calendars in both houses create an
66-13 emergency and an imperative public necessity that the
66-14 constitutional rule requiring bills to be read on three several
66-15 days in each house be suspended, and this rule is hereby suspended.