76R14139 GCH-D
By Greenberg, Telford, Walker, McClendon, H.B. No. 2701
Clark
Substitute the following for H.B. No. 2701:
By Greenberg C.S.H.B. No. 2701
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to systems and programs administered by the Teacher
1-3 Retirement System of Texas.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 822.201, Government Code, is amended by
1-6 amending Subsection (b), as amended by Chapters 330 and 1035, Acts
1-7 of the 75th Legislature, Regular Session, 1997, and adding
1-8 Subsection (e) to read as follows:
1-9 (b) "Salary and wages" as used in Subsection (a) means:
1-10 (1) normal periodic payments of money for service the
1-11 right to which accrues on a regular basis in proportion to the
1-12 service performed;
1-13 (2) amounts by which the member's salary is reduced
1-14 under a salary reduction agreement authorized by Chapter 610;
1-15 (3) amounts that would otherwise qualify as salary and
1-16 wages under Subdivision (1) but are not received directly by the
1-17 member pursuant to a good faith, voluntary written salary reduction
1-18 agreement in order to finance payments to a deferred compensation
1-19 or tax sheltered annuity program specifically authorized by state
1-20 law or to finance benefit options under a cafeteria plan qualifying
1-21 under Section 125 of the Internal Revenue Code of 1986 (26 U.S.C.
1-22 Section 125), if:
1-23 (A) the program or benefit options are made
1-24 available to all employees of the employer; and
2-1 (B) the benefit options in the cafeteria plan
2-2 are limited to one or more options that provide deferred
2-3 compensation, group health and disability insurance, group term
2-4 life insurance, dependent care assistance programs, or group legal
2-5 services plans; [and]
2-6 (4) performance pay awarded to an employee by a school
2-7 district as part of a total compensation plan approved by the board
2-8 of trustees of the district and meeting the requirements of
2-9 Subsection (e); and[.]
2-10 (5) [(4)] the benefit replacement pay a person earns
2-11 under Subchapter H, Chapter 659, as added by Chapter 417, Acts of
2-12 the 74th Legislature, 1995, except as provided by Subsection (c).
2-13 (e) For purposes of Subsection (b)(4), a total compensation
2-14 plan must:
2-15 (1) describe all elements of compensation received by
2-16 all employees of the employer;
2-17 (2) provide at least one type of performance pay to
2-18 classroom teachers employed by the employer;
2-19 (3) identify each type of performance pay, the
2-20 performance criteria for each type of performance pay, and the
2-21 classes of employees eligible for each type of performance pay;
2-22 (4) contain sufficient information concerning the plan
2-23 to ascertain the amount of each qualifying employee's pay under the
2-24 plan;
2-25 (5) contain performance criteria for earning
2-26 performance pay that preclude the exercise of discretion for
2-27 awarding the pay on any basis other than an evaluation of employee
3-1 or group performance or availability of funding; and
3-2 (6) satisfy any other requirements adopted by the
3-3 retirement system.
3-4 SECTION 2. Subchapter A, Chapter 823, Government Code, is
3-5 amended by adding Section 823.006 to read as follows:
3-6 Sec. 823.006. PERMISSIVE SERVICE CREDIT RESTRICTIONS. (a)
3-7 In this section:
3-8 (1) "Nonqualified service" means service for which
3-9 permissive service credit is authorized by this subtitle, other
3-10 than:
3-11 (A) military service; and
3-12 (B) service for any agency or instrumentality of
3-13 this state, including a political subdivision of this state, or for
3-14 any public school supported by the United States or a state or
3-15 territory of the United States, if credit for the service would not
3-16 cause a person to receive a retirement benefit for the same service
3-17 from more than one retirement system or program.
3-18 (2) "Permissive service credit" means service credit:
3-19 (A) that is not membership credit authorized to
3-20 be reinstated;
3-21 (B) that is recognized under this subtitle for
3-22 purposes of computing a member's benefit under the retirement
3-23 system;
3-24 (C) for which the member has not received credit
3-25 with the retirement system; and
3-26 (D) that a member may receive only by making a
3-27 voluntary additional contribution in an amount determined as
4-1 provided by this subtitle that does not exceed the amount necessary
4-2 to fund the benefit attributable to the service credit.
4-3 (b) The purchase of permissive service credit by a person
4-4 who first becomes a member of the retirement system after August
4-5 31, 2000, is subject to the restrictions and conditions of
4-6 Subsection (d) in addition to all other requirements of this
4-7 subtitle applicable to the purchase.
4-8 (c) The purchase by any person of permissive service credit
4-9 that was first made available under the retirement system after
4-10 December 31, 1997, is subject to the restrictions and conditions of
4-11 Subsection (d) in addition to all other requirements of this
4-12 subtitle applicable to the purchase.
4-13 (d) Under a circumstance described by Subsection (b) or (c),
4-14 a member may not purchase more than five years of permissive
4-15 service credit for nonqualified service, and a member may not
4-16 purchase service credit for nonqualified service before the member
4-17 has at least five years of membership service credit.
4-18 SECTION 3. Subchapter C, Chapter 823, Government Code, is
4-19 amended by adding Section 823.203 to read as follows:
4-20 Sec. 823.203. MEMBERSHIP SERVICE FOR OPTIONAL RETIREMENT
4-21 PROGRAM. A member may not establish service credit in the
4-22 retirement system for any period when the member was participating
4-23 in the optional retirement program under Chapter 830.
4-24 SECTION 4. Sections 823.501(b) and (f), Government Code, are
4-25 amended to read as follows:
4-26 (b) A person eligible to reinstate service credit under this
4-27 section is one who is a [contributing] member of the retirement
5-1 system at the time the service is reinstated.
5-2 (f) A [contributing] member may have an account that was
5-3 terminated by absence from service reactivated by requesting the
5-4 reactivation in writing. The beneficiary of a decedent who was a
5-5 [contributing] member at the time of death may have an account that
5-6 was terminated by the decedent's absence from service reactivated
5-7 by requesting the reactivation in writing before the first payment
5-8 of a death benefit.
5-9 SECTION 5. Section 824.101(c), Government Code, is amended
5-10 to read as follows:
5-11 (c) Only one person may be designated as beneficiary of an
5-12 optional retirement annuity under Section 824.204(c)(1), (c)(2), or
5-13 (c)(5), and a designation of beneficiary under any of those options
5-14 may not be made, changed, or revoked, except as provided by
5-15 Sections 824.1011, [and] 824.1012, and 824.1013, after the later of
5-16 the date on which the retirement system makes the first annuity
5-17 payment to the retiree or the date the first payment becomes due.
5-18 For purposes of this section, the term "makes payment" includes the
5-19 depositing in the mail of a payment warrant or the crediting of an
5-20 account with payment through electronic funds transfer.
5-21 SECTION 6. Section 824.1011(a), Government Code, is amended
5-22 to read as follows:
5-23 (a) A retiree who is receiving a standard service or
5-24 disability retirement annuity under Section 824.203 or 824.304(b)
5-25 and who marries after the date of the person's retirement may
5-26 replace the annuity by selecting an optional retirement annuity
5-27 under Section 824.204(c)(1), (c)(2), or (c)(5) or under Section
6-1 824.308(c)(1), (c)(2), or (c)(5), as applicable, and designating
6-2 the person's spouse as beneficiary before the second [first]
6-3 anniversary of the marriage in the same manner as an annuity
6-4 selection and designation of beneficiary may be made before
6-5 retirement.
6-6 SECTION 7. Section 824.1012, Government Code, as added by
6-7 Chapter 1416, Acts of the 75th Legislature, Regular Session, 1997,
6-8 is redesignated as Section 824.1013 to read as follows:
6-9 Sec. 824.1013 [824.1012]. CHANGE OF BENEFICIARY AFTER
6-10 RETIREMENT. (a) A retiree receiving an optional retirement
6-11 annuity under Section 824.204(c)(1), (c)(2), or (c)(5) or Section
6-12 824.308(c)(1), (c)(2), or (c)(5) may change the designated
6-13 beneficiary as provided by this section for the benefits payable
6-14 after the retiree's death under those sections.
6-15 (b) If the beneficiary designated at the time of the
6-16 retiree's retirement is the spouse or former spouse of the retiree:
6-17 (1) the spouse or former spouse must give written,
6-18 notarized consent to the change; or
6-19 (2) a court with jurisdiction over the marriage must
6-20 have ordered the change.
6-21 (c) A beneficiary designated under this section is entitled
6-22 on the retiree's death to receive monthly payments of the
6-23 survivor's portion of the retiree's optional retirement annuity for
6-24 the shorter of:
6-25 (1) the remainder of the life expectancy of the
6-26 beneficiary designated as of the effective date of the retiree's
6-27 retirement; or
7-1 (2) the remainder of the new beneficiary's life.
7-2 (d) A retiree may not change a beneficiary under this
7-3 section after retirement if the retiree has previously changed or
7-4 designated after retirement a beneficiary for optional retirement
7-5 annuity payments under this subtitle.
7-6 SECTION 8. Sections 824.203(a) and (e), Government Code, are
7-7 amended to read as follows:
7-8 (a) Except as provided by Subsections (c), (d), and (e), the
7-9 standard service retirement annuity is an amount computed on the
7-10 basis of the member's average annual compensation for the three
7-11 years of service, whether or not consecutive, in which the member
7-12 received the highest annual compensation, times 2.2 [two] percent
7-13 for each year of service credit in the retirement system.
7-14 (e) The annual standard service retirement annuity for a
7-15 person who immediately before retirement holds a position as a
7-16 classroom teacher or full-time librarian, or the annual death
7-17 benefit annuity based on the service of a member who at the time of
7-18 death held a position as a classroom teacher or full-time
7-19 librarian, may not be less than an amount computed on the basis of
7-20 the minimum annual salary provided by the Education Code for a
7-21 classroom teacher or full-time librarian, multiplied by 2.2 [two]
7-22 percent for each year of service credit in the retirement system.
7-23 SECTION 9. Subchapter C, Chapter 824, Government Code, is
7-24 amended by adding Section 824.2045 to read as follows:
7-25 Sec. 824.2045. PARTIAL LUMP-SUM OPTION. (a) A member who
7-26 is eligible for an unreduced service retirement annuity and is not
7-27 participating in the deferred retirement option plan under
8-1 Subchapter I may select a standard service retirement annuity or an
8-2 optional service retirement annuity described by Section 824.204,
8-3 together with a partial lump-sum distribution.
8-4 (b) The amount of the lump-sum distribution under this
8-5 section may not exceed the sum of 36 months of a standard service
8-6 retirement annuity computed without regard to this section.
8-7 (c) The service retirement annuity selected by the member
8-8 shall be actuarially reduced to reflect the lump-sum option
8-9 selected by the member and shall be actuarially equivalent to a
8-10 standard or optional service retirement annuity, as applicable,
8-11 without the partial lump-sum distribution. The annuity and lump
8-12 sum shall be computed to result in no actuarial loss to the
8-13 retirement system.
8-14 (d) The retiring member may choose a lump sum equal to 12
8-15 months of a standard service retirement annuity and payable at the
8-16 same time that the first monthly payment of the annuity is paid, a
8-17 lump sum equal to 24 months of a standard annuity and payable in
8-18 one or two annual payments, or a lump sum equal to 36 months of a
8-19 standard annuity and payable in one, two, or three annual payments.
8-20 At the option of the member, a payment under this subsection may be
8-21 made as provided by Section 825.509.
8-22 (e) The amount of the lump-sum distribution will be deducted
8-23 from any amounts otherwise payable under Section 824.503.
8-24 (f) The partial lump-sum option under this section may be
8-25 elected only once by a member and may not be elected by a retiree.
8-26 A member retiring under the proportionate retirement program under
8-27 Chapter 803 is not eligible for the partial lump-sum option.
9-1 (g) Before a retiring member selects a partial lump-sum
9-2 distribution under this section, the retirement system shall
9-3 provide a written notice to the member of the amount by which the
9-4 member's annuity will be reduced because of the selection. The
9-5 member shall be asked to sign a copy of or receipt for the notice,
9-6 and the retirement system shall maintain the signed copy or
9-7 receipt.
9-8 (h) The board of trustees may adopt rules for the
9-9 implementation of this section.
9-10 SECTION 10. Section 824.502, Government Code, is amended to
9-11 read as follows:
9-12 Sec. 824.502. BENEFITS ON DEATH OF DISABILITY RETIREE. The
9-13 designated beneficiary of a disability retiree who retires before
9-14 September 1, 1992, who has not selected an optional annuity under
9-15 Section 824.308, and who dies while receiving a retirement benefit
9-16 may elect to receive, instead of survivor benefits provided by
9-17 Section 824.501, a benefit available under Section 824.402,
9-18 computed as if the decedent had been in service at the time of
9-19 death.
9-20 SECTION 11. Sections 824.602(a) and (d), Government Code,
9-21 are amended to read as follows:
9-22 (a) Subject to Section 825.506, the [The] retirement system
9-23 may not, under Section 824.601, withhold a monthly benefit payment
9-24 if the retiree is employed in a Texas public educational
9-25 institution:
9-26 (1) as a substitute only with pay not more than the
9-27 daily rate of substitute pay established by the employer and, if
10-1 the retiree is a disability retiree, the employment has not
10-2 exceeded a total of 90 days in the school year;
10-3 (2) in a position, other than as a substitute, on no
10-4 more than a one-half time basis for the month;
10-5 (3) in one or more positions on as much as a full-time
10-6 basis, if[:]
10-7 [(A)] the work occurs in not more than six
10-8 months of a school year that begins after the retiree's effective
10-9 date of retirement;
10-10 [(B) the work occurs in no more than six months
10-11 of the school year; and]
10-12 [(C) the retiree executes on a form and within
10-13 any deadline prescribed by the retirement system a written election
10-14 to have this exception apply for the school year in determining
10-15 whether benefits are to be suspended for employment after
10-16 retirement; or]
10-17 (4) in a position, other than as a substitute, on no
10-18 more than a one-half time basis for no more than 90 days in the
10-19 school year, if the retiree is a disability retiree; or
10-20 (5) in a position as a classroom teacher on as much as
10-21 a full-time basis, if the retiree has retired under Section
10-22 824.202(a) without reduction for retirement at an early age, is
10-23 certified under Subchapter B, Chapter 21, Education Code, to teach
10-24 the subjects assigned, is teaching in an acute shortage area as
10-25 defined by the commissioner of education, and has been separated
10-26 from service with all public schools for at least 12 months.
10-27 (d) A retiree to whom [who has elected to avoid loss of
11-1 monthly benefits in a school year pursuant to] Subsection (a)(3)
11-2 applies is not eligible during that school year for any other
11-3 exceptions to loss of benefits provided in this section. If a
11-4 retiree is employed under [elects] the exemption provided in
11-5 Subsection (a)(3) for a school year, the retirement system must
11-6 include any previous employment during the school year, including
11-7 any employment that relied upon the exemptions in Subsection (a)(1)
11-8 or (a)(2), in determining whether and when the retiree has exceeded
11-9 six months of employment in the school year.
11-10 SECTION 12. Section 824.804(a), Government Code, is amended
11-11 to read as follows:
11-12 (a) On the effective date of a member's participation in the
11-13 plan, the retirement system shall make the transfers required by
11-14 Section 825.309 to the retired reserve account as if the member had
11-15 retired on that date. The retirement system shall transfer
11-16 monthly, during the period of the member's participation in the
11-17 plan, from the retired reserve account to an account for the member
11-18 in the deferred retirement option account an amount equal to:
11-19 (1) 60 percent of the amount the member would have
11-20 received that month under a standard service retirement annuity if
11-21 the member had retired under the multiplier currently in effect; or
11-22 (2) if the member began participation in the plan
11-23 before September 1, 1999, 79 percent of the amount the member would
11-24 have received that month under a standard service retirement
11-25 annuity if the member had retired under the multiplier currently in
11-26 effect [on the effective date of plan participation].
11-27 SECTION 13. Section 824.805, Government Code, is amended to
12-1 read as follows:
12-2 Sec. 824.805. TERMINATION OF PARTICIPATION IN PLAN. (a)
12-3 Except as provided by Subsection (b), a [A] member terminates
12-4 participation in the plan by:
12-5 (1) retirement;
12-6 (2) death; or
12-7 (3) expiration of the period for which participation
12-8 was approved.
12-9 (b) A member participating in the plan on September 1, 1999,
12-10 may, before September 1, 2000, elect to discontinue participation
12-11 in the plan on a form prescribed by and filed with the retirement
12-12 system. The retirement system shall make account transfers and
12-13 change records for a member who elects under this subsection to
12-14 discontinue participation in the plan as if the member had never
12-15 participated in the plan.
12-16 SECTION 14. The heading of Section 825.303, Government Code,
12-17 is amended to read as follows:
12-18 Sec. 825.303. SECURITIES CUSTODY AND SECURITIES LENDING
12-19 SECTION 15. Section 825.303(a), Government Code, is amended
12-20 to read as follows:
12-21 (a) The retirement system may, in the exercise of its
12-22 constitutional discretion to manage the assets of the retirement
12-23 system, select one or more commercial banks, depository trust
12-24 companies, or other entities to serve as custodian or custodians of
12-25 the system's securities and to lend the securities under rules
12-26 adopted by the board of trustees and as required by this section.
12-27 The retirement system may select one or more commercial banks,
13-1 depository trust companies, or other entities to act independently
13-2 of the custodian and lend the securities under board rules and as
13-3 required by this section.
13-4 SECTION 16. Section 825.405(c), Government Code, is amended
13-5 to read as follows:
13-6 (c) Monthly, employers shall:
13-7 (1) report to the retirement system in a form
13-8 prescribed by the system a certification of the total amount of
13-9 salary paid above the statutory minimum salary and the total amount
13-10 of employer contributions due under this section for the payroll
13-11 period; and
13-12 (2) retain information, as determined by the
13-13 retirement system, sufficient to allow administration of this
13-14 section, [The employer's form showing deductions and certification
13-15 of earnings must provide the retirement system with information
13-16 sufficient to administer this section, as determined by the
13-17 system,] including information for each employee showing the
13-18 applicable minimum salary as well as aggregate annual compensation.
13-19 SECTION 17. Section 825.406(c), Government Code, is amended
13-20 to read as follows:
13-21 (c) Monthly, employers shall:
13-22 (1) report to the retirement system in a form
13-23 prescribed by the system a certification of the total amount of
13-24 salary paid from federal funds and private grants and the total
13-25 amounts provided by the funds and grants for state contributions
13-26 for the employees; and
13-27 (2) retain the following information:
14-1 (A) [(1)] the name of each employee paid in
14-2 whole or part from a grant;
14-3 (B) [(2)] the source of the grant;
14-4 (C) [(3)] the amount of the employee's salary
14-5 paid from the grant;
14-6 (D) [(4)] the amount of the money provided by
14-7 the grant for state contributions for the employee; and
14-8 (E) [(5)] any other information the retirement
14-9 system determines is necessary to enforce this section.
14-10 SECTION 18. Section 825.407(c), Government Code, is amended
14-11 to read as follows:
14-12 (c) The designated disbursing officer of each general
14-13 academic teaching institution and the designated disbursing officer
14-14 of each medical and dental unit shall:
14-15 (1) submit to the retirement system, at a time and in
14-16 the manner prescribed by the retirement system, a monthly report
14-17 containing a certification of the total amount of salary paid from
14-18 noneducational and general funds and the total amount of employer
14-19 contributions due under this section for the payroll period; and
14-20 (2) maintain and retain the following information:
14-21 (A) [(1)] the name of each member employed by
14-22 the institution or unit who, for the most recent payroll period,
14-23 was paid wholly or partly from noneducational and general funds;
14-24 (B) [(2)] the amount of the employee's salary
14-25 for the most recent payroll period that was paid from
14-26 noneducational and general funds;
14-27 [(3) a certification of the total amount of employer
15-1 contributions due under this section for the payroll period;] and
15-2 (C) [(4)] any other information the retirement
15-3 system determines is necessary to administer this section.
15-4 SECTION 19. Section 825.408(a), Government Code, is amended
15-5 to read as follows:
15-6 (a) An employing district that fails to remit, before the
15-7 11th day after the last day of a month, all member and employer
15-8 deposits and documentation of the deposits required by this
15-9 subchapter to be remitted by the district for the month shall pay
15-10 to the retirement system, in addition to the deposits, interest on
15-11 the unpaid or undocumented amounts at an annual rate compounded
15-12 monthly. The rate of interest is the rate established under
15-13 Section 825.313(b)(2), plus two percent. Interest required under
15-14 this section is creditable to the interest account.
15-15 SECTION 20. Section 825.515, Government Code, is amended to
15-16 read as follows:
15-17 Sec. 825.515. INFORMATION ABOUT MEMBER POSITIONS. (a) At
15-18 least annually, the [The] retirement system shall acquire and
15-19 maintain records identifying members and the types of positions
15-20 they hold [have held] as members[, the length of service in each
15-21 type of position, and whether service in each type of position is
15-22 or was as a full-time employee]. The type of position shall be
15-23 identified as Administrative/Professional, Teacher/Full-Time
15-24 Librarian, Support, or Bus Driver. [The retirement system shall
15-25 cooperate with the commissioner of education in maintaining
15-26 information about the employment status of members of the
15-27 retirement system.]
16-1 (b) [Each school year, the retirement system shall provide
16-2 to the commissioner of education information, of a type and in a
16-3 form determined by the commissioner, that allows contributing
16-4 members of the retirement system to be identified in information
16-5 submitted to the commissioner by school districts under the
16-6 Education Code.]
16-7 [(c)] Information contained in records of the retirement
16-8 system maintained under this section is confidential within the
16-9 limits prescribed by Section 825.507.
16-10 SECTION 21. Sections 825.516(a) and (b), Government Code,
16-11 are amended to read as follows:
16-12 (a) A retiree who is receiving an annuity from the
16-13 retirement system may request the system to withhold from the
16-14 retiree's monthly annuity payment membership dues for a nonprofit
16-15 association of retired school employees in this state, if the
16-16 association is statewide and its membership includes at least five
16-17 percent of all retirees of the retirement system. The request for
16-18 withholding must be on a form provided by the retirement system.
16-19 (b) After the retirement system receives a request
16-20 authorized by this section, the system may [shall] make the
16-21 requested deductions until the earlier of:
16-22 (1) the date the annuity is terminated; or
16-23 (2) the first payment of the annuity after the date
16-24 the system receives a written request signed by the retiree
16-25 canceling the request for the withholding.
16-26 SECTION 22. Section 16A(d), Article 3.50-4, Insurance Code,
16-27 is amended to read as follows:
17-1 (d) Monthly, employers shall:
17-2 (1) report to the trustee in a form prescribed by the
17-3 trustee a certification of the total amount of salary paid from
17-4 federal funds and private grants and the total amounts provided by
17-5 the funds and grants for state contributions for the employees; and
17-6 (2) maintain and retain the following information:
17-7 (A) [(1)] the name of each [active] employee
17-8 paid in whole or part from a grant;
17-9 (B) [(2)] the source of the grant;
17-10 (C) [(3)] the amount of the [active] employee's
17-11 salary paid from the grant;
17-12 (D) [(4)] the amount of the money provided by
17-13 the grant for state contributions for the [active] employee; and
17-14 (E) [(5)] any other information the trustee
17-15 determines is necessary to enforce this section.
17-16 SECTION 23. Subchapter E, Chapter 3, Insurance Code, is
17-17 amended by adding Article 3.50-4A to read as follows:
17-18 Art. 3.50-4A. INSURANCE FOR SCHOOL DISTRICT EMPLOYEES AND
17-19 RETIREES
17-20 Sec. 1. DEFINITIONS. In this article:
17-21 (1) "Employee" means a person who is a participating
17-22 member of the Teacher Retirement System of Texas and is not
17-23 participating in a group insurance program under the Texas
17-24 Employees Uniform Group Insurance Benefits Act (Article 3.50-2,
17-25 Vernon's Texas Insurance Code) or the Texas State College and
17-26 University Employees Uniform Insurance Benefits Act (Article
17-27 3.50-3, Vernon's Texas Insurance Code).
18-1 (2) "Retiree" means a person who:
18-2 (A) has retired under the Teacher Retirement
18-3 System of Texas with at least 10 years of credit for service in
18-4 public schools of this state or has retired under that system for
18-5 disability and is entitled to receive an annuity from the system
18-6 based on the person's service; and
18-7 (B) is not eligible to participate in the group
18-8 insurance program provided under the Texas Employees Uniform Group
18-9 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
18-10 Code) or the Texas State College and University Employees Uniform
18-11 Insurance Benefits Act (Article 3.50-3, Vernon's Texas Insurance
18-12 Code).
18-13 (3) "Trustee" means the Teacher Retirement System of
18-14 Texas.
18-15 Sec. 2. INSURANCE COVERAGE. (a) The trustee shall contract
18-16 with one or more carriers authorized to provide life insurance in
18-17 this state to offer employees and retirees optional permanent life
18-18 insurance coverage.
18-19 (b) The trustee shall contract with one or more carriers
18-20 authorized to provide long-term health care insurance in this state
18-21 to offer employees and retirees optional long-term health care
18-22 insurance coverage. The long-term care insurance coverage shall
18-23 include home, community, and institutional care.
18-24 (c) The trustee shall contract with one or more carriers
18-25 authorized to provide disability insurance in this state to offer
18-26 employees optional insurance against short-term or long-term loss
18-27 of salary because of disability.
19-1 (d) In contracting for any benefits under this article,
19-2 competitive bidding shall be required under rules adopted by the
19-3 trustee. The rules may provide criteria to determine qualified
19-4 carriers. The trustee is not required to select the lowest bid but
19-5 also may consider ability to service contracts, past experiences,
19-6 financial stability, and other relevant criteria. If the trustee
19-7 awards a contract to an entity whose bid deviates from that
19-8 advertised, the deviation shall be recorded and the reasons for the
19-9 deviation shall be fully justified in the minutes of the next
19-10 meeting of the trustee.
19-11 (e) Insurance coverage provided under this section shall be
19-12 made available periodically during open enrollment periods
19-13 determined by the trustee.
19-14 Sec. 3. ADMINISTRATION. (a) The trustee shall adopt rules
19-15 for the selection of contractors under this article. The rules
19-16 must require the contractors to administer enrollment, adjudication
19-17 of claims, and coordination of services under the insurance
19-18 coverages and require the contractors to account for premiums
19-19 collected and disbursed under the coverages.
19-20 (b) The trustee may adopt other rules necessary to
19-21 administer the program provided under this article.
19-22 Sec. 4. PARTICIPATION IN COVERAGE. (a) The trustee shall
19-23 offer the coverages provided under this article to employees
19-24 through their employers and to retirees through the trustee's
19-25 administration of the retirement system.
19-26 (b) The full cost of premiums in a plan of insurance
19-27 coverage provided under this article is the responsibility of the
20-1 enrollees.
20-2 (c) An employee participating in a plan of insurance
20-3 coverage provided under this article shall pay premiums by payroll
20-4 deduction remitted by the employee's employer at the times and in
20-5 the manner provided by the trustee.
20-6 (d) A retiree participating in a plan of insurance coverage
20-7 provided under this article shall pay premiums by deduction from
20-8 the retiree's monthly retirement annuity.
20-9 Sec. 5. SCHOOL DISTRICT EMPLOYEES AND RETIREES OPTIONAL
20-10 INSURANCE TRUST FUND. (a) The school district employees and
20-11 retirees optional insurance trust fund is created as a trust fund
20-12 with the comptroller and shall be administered by the trustee on
20-13 behalf of the participants in the plans of insurance coverage
20-14 provided under this article.
20-15 (b) Premiums paid by enrollees, amounts recovered under
20-16 contracts for the implementation of the program provided by this
20-17 article, and investment and depository income of the fund shall be
20-18 credited to the fund.
20-19 (c) Money in the fund may be used only for the purpose of
20-20 providing the program of insurance coverage provided under this
20-21 article, including the expenses of administering the program.
20-22 (d) The trustee may invest the fund in the manner provided
20-23 by Section 67(a)(3), Article XVI, Texas Constitution.
20-24 SECTION 24. Sections 22.004(c) and (d), Education Code, are
20-25 amended to read as follows:
20-26 (c) Each district shall report the district's compliance
20-27 with this subsection to the executive director of the Teacher
21-1 Retirement System of Texas not later than March [November] 1 of
21-2 each even-numbered year in the manner required by the board of
21-3 trustees of the Teacher Retirement System of Texas. The report
21-4 must be based on the district group health coverage plan in effect
21-5 during the current plan year [on November 1] and must include:
21-6 (1) appropriate documentation of:
21-7 (A) the district's contract for group health
21-8 coverage with a provider licensed to do business in this state by
21-9 the Texas Department of Insurance or a risk pool authorized under
21-10 Chapter 172, Local Government Code; or
21-11 (B) a resolution of the board of trustees of the
21-12 district authorizing a self-insurance plan for district employees
21-13 and of the district's review of district ability to cover the
21-14 liability assumed;
21-15 (2) the schedule of benefits;
21-16 (3) the premium rate sheet, including the amount paid
21-17 by the district and employee;
21-18 (4) the number of employees covered by each health
21-19 coverage plan offered by the district; and
21-20 (5) any other information considered appropriate by
21-21 the executive director of the Teacher Retirement System of Texas.
21-22 (d) Based on the criteria prescribed by Subsection (a), the
21-23 executive director of the Teacher Retirement System of Texas shall
21-24 certify whether a district's coverage is comparable to the basic
21-25 health coverage provided under the Texas Employees Uniform Group
21-26 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
21-27 Code). If the executive director of the Teacher Retirement System
22-1 of Texas determines that the group health coverage offered by a
22-2 district is not comparable, the executive director shall report
22-3 that information to the district and to the Legislative Budget
22-4 Board. The executive director shall submit a report to the
22-5 legislature not later than September [January] 1 of each
22-6 even-numbered [odd numbered] year describing the status of each
22-7 district's group health coverage program based on the information
22-8 contained in the report required by Subsection (c) and the
22-9 certification required by this subsection.
22-10 SECTION 25. (a) Monthly payments of a death or retirement
22-11 benefit annuity by the Teacher Retirement System of Texas are
22-12 increased beginning with the payment due at the end of September
22-13 1999.
22-14 (b) The increase does not apply to payments under Section
22-15 824.304(a), 824.404, or 824.501, Government Code.
22-16 (c) Except as provided by Subsection (d) of this section,
22-17 the amount of the monthly increase is computed by multiplying the
22-18 previous monthly benefit by a percentage determined in accordance
22-19 with the following table:
22-20 LATEST RETIREMENT DATE OR,
22-21 IF APPLICABLE, DATE OF DEATH INCREASE
22-22 Before September 1, 1973 5%
22-23 On or after September 1, 1973, but before September 1, 1974 6%
22-24 On or after September 1, 1974, but before September 1, 1979 5%
22-25 On or after September 1, 1979, but before September 1, 1981 6%
22-26 On or after September 1, 1981, but before September 1, 1982 7%
22-27 On or after September 1, 1982, but before September 1, 1983 6%
23-1 On or after September 1, 1983, but before September 1, 1990 7%
23-2 On or after September 1, 1990, but before September 1, 1991 6%
23-3 On or after September 1, 1991, but before September 1, 1992 7%
23-4 On or after September 1, 1992, but before September 1, 1995 6%
23-5 On or after September 1, 1995, but before September 1, 1997 5%
23-6 On or after September 1, 1997, but before September 1, 1998 2%
23-7 (d) After making the computations required by Subsection (c)
23-8 of this section, the retirement system shall increase each annuity
23-9 payable by the system on September 1, 1999, other than an annuity
23-10 under Section 824.304(a), 824.404, or 824.501, Government Code, by
23-11 10 percent, which is a benefit equivalent to the benefit provided
23-12 by using a 2.2 percent multiplier for computing annuities.
23-13 SECTION 26. (a) Notwithstanding Section 824.1011,
23-14 Government Code, as amended by this Act, a person who is receiving
23-15 a standard service or disability retirement annuity under Section
23-16 824.203 or 824.304(b), Government Code, on the effective date of
23-17 this Act and who married after retirement but before that date may,
23-18 before September 1, 2000, replace the annuity by selecting an
23-19 optional annuity and designating the person's spouse as beneficiary
23-20 as if the person had married after the effective date of this Act.
23-21 (b) Notwithstanding Section 824.1011, Government Code, as
23-22 amended by this Act, a person who retired before September 1, 1992,
23-23 and is receiving a standard disability retirement annuity under
23-24 Section 824.304(b), Government Code, on the effective date of this
23-25 Act may before September 1, 2001, replace the annuity by selecting
23-26 an optional annuity described by Section 824.308, Government Code.
23-27 An optional annuity selected under this subsection shall be
24-1 actuarially reduced according to the ages of the retiree and the
24-2 designated beneficiary at the time the annuity is selected.
24-3 SECTION 27. This Act takes effect September 1, 1999, except
24-4 Section 11, which takes effect at the beginning of the 1999-2000
24-5 school year.
24-6 SECTION 28. The importance of this legislation and the
24-7 crowded condition of the calendars in both houses create an
24-8 emergency and an imperative public necessity that the
24-9 constitutional rule requiring bills to be read on three several
24-10 days in each house be suspended, and this rule is hereby suspended,
24-11 and that this Act take effect and be in force according to its
24-12 terms, and it is so enacted.