AN ACT
1-1 relating to systems and programs administered by the Teacher
1-2 Retirement System of Texas.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 822.201, Government Code, is amended by
1-5 amending Subsection (b), as amended by Chapters 330 and 1035, Acts
1-6 of the 75th Legislature, Regular Session, 1997, and adding
1-7 Subsection (e) to read as follows:
1-8 (b) "Salary and wages" as used in Subsection (a) means:
1-9 (1) normal periodic payments of money for service the
1-10 right to which accrues on a regular basis in proportion to the
1-11 service performed;
1-12 (2) amounts by which the member's salary is reduced
1-13 under a salary reduction agreement authorized by Chapter 610;
1-14 (3) amounts that would otherwise qualify as salary and
1-15 wages under Subdivision (1) but are not received directly by the
1-16 member pursuant to a good faith, voluntary written salary reduction
1-17 agreement in order to finance payments to a deferred compensation
1-18 or tax sheltered annuity program specifically authorized by state
1-19 law or to finance benefit options under a cafeteria plan qualifying
1-20 under Section 125 of the Internal Revenue Code of 1986 (26 U.S.C.
1-21 Section 125), if:
1-22 (A) the program or benefit options are made
1-23 available to all employees of the employer; and
1-24 (B) the benefit options in the cafeteria plan
2-1 are limited to one or more options that provide deferred
2-2 compensation, group health and disability insurance, group term
2-3 life insurance, dependent care assistance programs, or group legal
2-4 services plans; [and]
2-5 (4) performance pay awarded to an employee by a school
2-6 district as part of a total compensation plan approved by the board
2-7 of trustees of the district and meeting the requirements of
2-8 Subsection (e); and[.]
2-9 (5) [(4)] the benefit replacement pay a person earns
2-10 under Subchapter H, Chapter 659, as added by Chapter 417, Acts of
2-11 the 74th Legislature, 1995, except as provided by Subsection (c).
2-12 (e) For purposes of Subsection (b)(4), a total compensation
2-13 plan must:
2-14 (1) describe all elements of compensation received by
2-15 or available to all employees of the employer;
2-16 (2) provide for the availability of at least one type
2-17 of performance pay to classroom teachers employed by the employer;
2-18 (3) identify each type of performance pay, the
2-19 performance criteria for each type of performance pay, and the
2-20 classes of employees eligible for each type of performance pay;
2-21 (4) contain sufficient information concerning the plan
2-22 to ascertain the amount of each qualifying employee's pay under the
2-23 plan;
2-24 (5) contain performance criteria for earning
2-25 performance pay that preclude the exercise of discretion for
2-26 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.
3-7 (a) 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
4-1 voluntary additional contribution in an amount determined as
4-2 provided by this subtitle that does not exceed the amount necessary
4-3 to fund the benefit attributable to the service credit.
4-4 (b) The purchase of permissive service credit by a person
4-5 who first becomes a member of the retirement system after August
4-6 31, 2000, is subject to the restrictions and conditions of
4-7 Subsection (d) in addition to all other requirements of this
4-8 subtitle applicable to the purchase.
4-9 (c) The purchase by any person of permissive service credit
4-10 that was first made available under the retirement system after
4-11 December 31, 1997, is subject to the restrictions and conditions of
4-12 Subsection (d) in addition to all other requirements of this
4-13 subtitle applicable to the purchase.
4-14 (d) Under a circumstance described by Subsection (b) or (c),
4-15 a member may not purchase more than five years of permissive
4-16 service credit for nonqualified service, and a member may not
4-17 purchase service credit for nonqualified service before the member
4-18 has at least five years of membership service credit.
4-19 SECTION 3. Subchapter C, Chapter 823, Government Code, is
4-20 amended by adding Section 823.203 to read as follows:
4-21 Sec. 823.203. MEMBERSHIP SERVICE FOR OPTIONAL RETIREMENT
4-22 PROGRAM. A member may not establish service credit in the
4-23 retirement system for any period when the member was participating
4-24 in the optional retirement program under Chapter 830.
4-25 SECTION 4. Section 823.401, Government Code, is amended by
4-26 adding Subsection (j) to read as follows:
5-1 (j) The board of trustees may adopt rules providing for the
5-2 adoption of a reciprocal agreement with a state or territory of a
5-3 member's previous employment for the payment for service credit
5-4 established under this section through the transfer from the state
5-5 or territory to the retirement system of contributions made on
5-6 behalf of the member in the form of an eligible rollover
5-7 distribution as provided by Section 401(a)(31), Internal Revenue
5-8 Code of 1986, and its subsequent amendments.
5-9 SECTION 5. Subsections (b) and (f), Section 823.501,
5-10 Government Code, are amended to read as follows:
5-11 (b) A person eligible to reinstate service credit under this
5-12 section is one who is a [contributing] member of the retirement
5-13 system at the time the service is reinstated.
5-14 (f) A [contributing] member may have an account that was
5-15 terminated by absence from service reactivated by requesting the
5-16 reactivation in writing. The beneficiary of a decedent who was a
5-17 [contributing] member at the time of death may have an account that
5-18 was terminated by the decedent's absence from service reactivated
5-19 by requesting the reactivation in writing before the first payment
5-20 of a death benefit.
5-21 SECTION 6. Subsection (c), Section 824.101, Government Code,
5-22 is amended to read as follows:
5-23 (c) Only one person may be designated as beneficiary of an
5-24 optional retirement annuity under Section 824.204(c)(1), (c)(2), or
5-25 (c)(5), and a designation of beneficiary under any of those options
5-26 may not be made, changed, or revoked, except as provided by
6-1 Sections 824.1011, [and] 824.1012, and 824.1013, after the later of
6-2 the date on which the retirement system makes the first annuity
6-3 payment to the retiree or the date the first payment becomes due.
6-4 For purposes of this section, the term "makes payment" includes the
6-5 depositing in the mail of a payment warrant or the crediting of an
6-6 account with payment through electronic funds transfer.
6-7 SECTION 7. Subsection (a), Section 824.1011, Government
6-8 Code, is amended to read as follows:
6-9 (a) A retiree who is receiving a standard service or
6-10 disability retirement annuity under Section 824.203 or 824.304(b)
6-11 and who marries after the date of the person's retirement may
6-12 replace the annuity by selecting an optional retirement annuity
6-13 under Section 824.204(c)(1), (c)(2), or (c)(5) or under Section
6-14 824.308(c)(1), (c)(2), or (c)(5), as applicable, and designating
6-15 the person's spouse as beneficiary before the second [first]
6-16 anniversary of the marriage in the same manner as an annuity
6-17 selection and designation of beneficiary may be made before
6-18 retirement.
6-19 SECTION 8. Subsection (a), Section 824.1012, Government
6-20 Code, as added by Chapter 401, Acts of the 75th Legislature,
6-21 Regular Session, 1997, is amended to read as follows:
6-22 (a) As an exception to Section 824.101(c), a retiree who
6-23 selected an optional service retirement annuity under Section
6-24 824.204(c)(1), (c)(2), or (c)(5) or an optional disability
6-25 retirement annuity under Section 824.308(c)(1), (c)(2), or (c)(5)
6-26 may revoke the designation of the beneficiary to receive the
7-1 annuity on the death of the retiree, if a court in a divorce
7-2 proceeding involving the retiree and beneficiary approves or orders
7-3 the revocation in the divorce decree or acceptance of a property
7-4 settlement or if the beneficiary is an adult child of the retiree
7-5 and signs a notarized consent to the revocation. The revocation
7-6 takes effect when the retirement system receives it.
7-7 SECTION 9. Section 824.1012, Government Code, as added by
7-8 Chapter 1416, Acts of the 75th Legislature, Regular Session, 1997,
7-9 is redesignated as Section 824.1013 to read as follows:
7-10 Sec. 824.1013 [824.1012]. CHANGE OF BENEFICIARY AFTER
7-11 RETIREMENT. (a) A retiree receiving an optional retirement
7-12 annuity under Section 824.204(c)(1), (c)(2), or (c)(5) or Section
7-13 824.308(c)(1), (c)(2), or (c)(5) may change the designated
7-14 beneficiary as provided by this section for the benefits payable
7-15 after the retiree's death under those sections.
7-16 (b) If the beneficiary designated at the time of the
7-17 retiree's retirement is the spouse or former spouse of the retiree:
7-18 (1) the spouse or former spouse must give written,
7-19 notarized consent to the change; or
7-20 (2) a court with jurisdiction over the marriage must
7-21 have ordered the change.
7-22 (c) A beneficiary designated under this section is entitled
7-23 on the retiree's death to receive monthly payments of the
7-24 survivor's portion of the retiree's optional retirement annuity for
7-25 the shorter of:
7-26 (1) the remainder of the life expectancy of the
8-1 beneficiary designated as of the effective date of the retiree's
8-2 retirement; or
8-3 (2) the remainder of the new beneficiary's life.
8-4 (d) A retiree may not change a beneficiary under this
8-5 section after retirement if the retiree has previously changed or
8-6 designated after retirement a beneficiary for optional retirement
8-7 annuity payments under this subtitle.
8-8 SECTION 10. Subsections (a) and (e), Section 824.203,
8-9 Government Code, are amended to read as follows:
8-10 (a) Except as provided by Subsections (c), (d), and (e), the
8-11 standard service retirement annuity is an amount computed on the
8-12 basis of the member's average annual compensation for the three
8-13 years of service, whether or not consecutive, in which the member
8-14 received the highest annual compensation, times 2.2 [two] percent
8-15 for each year of service credit in the retirement system.
8-16 (e) The annual standard service retirement annuity for a
8-17 person who immediately before retirement holds a position as a
8-18 classroom teacher or full-time librarian, or the annual death
8-19 benefit annuity based on the service of a member who at the time of
8-20 death held a position as a classroom teacher or full-time
8-21 librarian, may not be less than an amount computed on the basis of
8-22 the minimum annual salary provided by the Education Code for a
8-23 classroom teacher or full-time librarian, multiplied by 2.2 [two]
8-24 percent for each year of service credit in the retirement system.
8-25 SECTION 11. Subchapter C, Chapter 824, Government Code, is
8-26 amended by adding Section 824.2045 to read as follows:
9-1 Sec. 824.2045. PARTIAL LUMP-SUM OPTION. (a) A member who
9-2 is eligible for an unreduced service retirement annuity and is not
9-3 participating in the deferred retirement option plan under
9-4 Subchapter I may select a standard service retirement annuity or an
9-5 optional service retirement annuity described by Section 824.204,
9-6 together with a partial lump-sum distribution.
9-7 (b) The amount of the lump-sum distribution under this
9-8 section may not exceed the sum of 36 months of a standard service
9-9 retirement annuity computed without regard to this section.
9-10 (c) The service retirement annuity selected by the member
9-11 shall be actuarially reduced to reflect the lump-sum option
9-12 selected by the member and shall be actuarially equivalent to a
9-13 standard or optional service retirement annuity, as applicable,
9-14 without the partial lump-sum distribution. The annuity and lump
9-15 sum shall be computed to result in no actuarial loss to the
9-16 retirement system.
9-17 (d) The retiring member may choose a lump sum equal to 12
9-18 months of a standard service retirement annuity and payable at the
9-19 same time that the first monthly payment of the annuity is paid, a
9-20 lump sum equal to 24 months of a standard annuity and payable in
9-21 one or two annual payments, or a lump sum equal to 36 months of a
9-22 standard annuity and payable in one, two, or three annual payments.
9-23 At the option of the member, a payment under this subsection may be
9-24 made as provided by Section 825.509.
9-25 (e) The amount of the lump-sum distribution will be deducted
9-26 from any amounts otherwise payable under Section 824.503.
10-1 (f) The partial lump-sum option under this section may be
10-2 elected only once by a member and may not be elected by a retiree.
10-3 A member retiring under the proportionate retirement program under
10-4 Chapter 803 is not eligible for the partial lump-sum option.
10-5 (g) Before a retiring member selects a partial lump-sum
10-6 distribution under this section, the retirement system shall
10-7 provide a written notice to the member of the amount by which the
10-8 member's annuity will be reduced because of the selection. The
10-9 member shall be asked to sign a copy of or receipt for the notice,
10-10 and the retirement system shall maintain the signed copy or
10-11 receipt.
10-12 (h) The board of trustees may adopt rules for the
10-13 implementation of this section.
10-14 SECTION 12. Section 824.402, Government Code, is amended by
10-15 redesignating existing Subsection (b) as Subsection (c) and adding
10-16 new Subsection (b) to read as follows:
10-17 (b) In addition to the benefits provided under Subsection
10-18 (a), the designated beneficiary of a member who is an employee of a
10-19 school district and who dies as the result of a physical assault
10-20 during the performance of the employee's regular duties is eligible
10-21 to receive a lump-sum death benefit payment in the amount of
10-22 $160,000.
10-23 (c) The board of trustees by rule may prescribe the manner
10-24 of payment of benefits under this section.
10-25 SECTION 13. Section 824.502, Government Code, is amended to
10-26 read as follows:
11-1 Sec. 824.502. BENEFITS ON DEATH OF DISABILITY RETIREE. The
11-2 designated beneficiary of a disability retiree who retires before
11-3 September 1, 1992, who has not selected an optional annuity under
11-4 Section 824.308, and who dies while receiving a retirement benefit
11-5 may elect to receive, instead of survivor benefits provided by
11-6 Section 824.501, a benefit available under Section 824.402,
11-7 computed as if the decedent had been in service at the time of
11-8 death.
11-9 SECTION 14. Subsections (a) and (d), Section 824.602,
11-10 Government Code, are amended to read as follows:
11-11 (a) Subject to Section 825.506, the [The] retirement system
11-12 may not, under Section 824.601, withhold a monthly benefit payment
11-13 if the retiree is employed in a Texas public educational
11-14 institution:
11-15 (1) as a substitute only with pay not more than the
11-16 daily rate of substitute pay established by the employer and, if
11-17 the retiree is a disability retiree, the employment has not
11-18 exceeded a total of 90 days in the school year;
11-19 (2) in a position, other than as a substitute, on no
11-20 more than a one-half time basis for the month;
11-21 (3) in one or more positions on as much as a full-time
11-22 basis, if[:]
11-23 [(A)] the work occurs in not more than six
11-24 months of a school year that begins after the retiree's effective
11-25 date of retirement;
11-26 [(B) the work occurs in no more than six months
12-1 of the school year; and]
12-2 [(C) the retiree executes on a form and within
12-3 any deadline prescribed by the retirement system a written election
12-4 to have this exception apply for the school year in determining
12-5 whether benefits are to be suspended for employment after
12-6 retirement; or]
12-7 (4) in a position, other than as a substitute, on no
12-8 more than a one-half time basis for no more than 90 days in the
12-9 school year, if the retiree is a disability retiree; or
12-10 (5) in a position as a classroom teacher on as much as
12-11 a full-time basis, if the retiree has retired under Section
12-12 824.202(a) without reduction for retirement at an early age, is
12-13 certified under Subchapter B, Chapter 21, Education Code, to teach
12-14 the subjects assigned, is teaching in an acute shortage area as
12-15 defined by the commissioner of education, and has been separated
12-16 from service with all public schools for at least 12 months.
12-17 (d) A retiree to whom [who has elected to avoid loss of
12-18 monthly benefits in a school year pursuant to] Subsection (a)(3)
12-19 applies is not eligible during that school year for any other
12-20 exceptions to loss of benefits provided in this section. If a
12-21 retiree is employed under [elects] the exemption provided in
12-22 Subsection (a)(3) for a school year, the retirement system must
12-23 include any previous employment during the school year, including
12-24 any employment that relied upon the exemptions in Subsection (a)(1)
12-25 or (a)(2), in determining whether and when the retiree has exceeded
12-26 six months of employment in the school year.
13-1 SECTION 15. Subsections (a) and (d), Section 824.804,
13-2 Government Code, are amended to read as follows:
13-3 (a) On the effective date of a member's participation in the
13-4 plan, the retirement system shall make the transfers required by
13-5 Section 825.309 to the retired reserve account as if the member had
13-6 retired on that date. The retirement system shall transfer
13-7 monthly, during the period of the member's participation in the
13-8 plan, from the retired reserve account to an account for the member
13-9 in the deferred retirement option account an amount equal to:
13-10 (1) 60 percent of the amount the member would have
13-11 received that month under a standard service retirement annuity if
13-12 the member had retired under the multiplier currently in effect; or
13-13 (2) if the member began participation in the plan
13-14 before September 1, 1999, 79 percent of the amount the member would
13-15 have received that month under a standard service retirement
13-16 annuity if the member had retired under the multiplier currently in
13-17 effect [on the effective date of plan participation].
13-18 (d) Payment of the benefit provided under the plan is in
13-19 addition to any annuity otherwise payable under this subtitle. The
13-20 retiring member may choose a DROP payment in accordance with the
13-21 provisions of Section 825.509.
13-22 SECTION 16. Section 824.805, Government Code, is amended to
13-23 read as follows:
13-24 Sec. 824.805. TERMINATION OF PARTICIPATION IN PLAN.
13-25 (a) Except as provided by Subsection (b), a [A] member terminates
13-26 participation in the plan by:
14-1 (1) retirement;
14-2 (2) death; or
14-3 (3) expiration of the period for which participation
14-4 was approved.
14-5 (b) A member participating in the plan on September 1, 1999,
14-6 may, before September 1, 2000, elect to discontinue participation
14-7 in the plan on a form prescribed by and filed with the retirement
14-8 system. The retirement system shall make account transfers and
14-9 change records for a member who elects under this subsection to
14-10 discontinue participation in the plan as if the member had never
14-11 participated in the plan.
14-12 SECTION 17. Section 825.301, Government Code, is amended by
14-13 amending Subsection (a) and adding Subsection (a-1) to read as
14-14 follows:
14-15 (a) The board of trustees shall invest and reinvest assets
14-16 of the retirement system without distinction as to their source in
14-17 accordance with Section 67, Article XVI, Texas Constitution. For
14-18 purposes of the investment authority of the board of trustees under
14-19 Section 67, Article XVI, Texas Constitution, "securities" means any
14-20 investment instrument within the meaning of the term as defined by
14-21 Section 4, The Securities Act (Article 581-4, Vernon's Texas Civil
14-22 Statutes), 15 U.S.C. Section 77b(a)(1), or 15 U.S.C. Section
14-23 78c(a)(10). An interest in a limited partnership or investment
14-24 contract is considered a security without regard to the number of
14-25 investors or the control, access to information, or rights granted
14-26 to or retained by the retirement system. Any instrument or
15-1 contract intended to manage transaction or currency exchange risk
15-2 in purchasing, selling, or holding securities is considered to be a
15-3 security. Investment decisions are subject to the standard
15-4 provided in the Texas Trust Code by Section 113.056(a), Property
15-5 Code.
15-6 (a-1) The legislative audit committee shall select an
15-7 independent firm during the biennium beginning September 1, 1999,
15-8 to evaluate the retirement system's investment practices and
15-9 performance under Subsection (a) as provided by Section 825.512.
15-10 This subsection expires January 1, 2001.
15-11 SECTION 18. The heading of Section 825.303, Government Code,
15-12 is amended to read as follows:
15-13 Sec. 825.303. SECURITIES CUSTODY AND SECURITIES LENDING.
15-14 SECTION 19. Subsection (a), Section 825.303, Government
15-15 Code, is amended to read as follows:
15-16 (a) The retirement system may, in the exercise of its
15-17 constitutional discretion to manage the assets of the retirement
15-18 system, select one or more commercial banks, depository trust
15-19 companies, or other entities to serve as custodian or custodians of
15-20 the system's securities and to lend the securities under rules
15-21 adopted by the board of trustees and as required by this section.
15-22 The retirement system may select one or more commercial banks,
15-23 depository trust companies, or other entities to act independently
15-24 of the custodian and lend the securities under board rules and as
15-25 required by this section.
15-26 SECTION 20. Subsection (c), Section 825.405, Government
16-1 Code, is amended to read as follows:
16-2 (c) Monthly, employers shall:
16-3 (1) report to the retirement system in a form
16-4 prescribed by the system a certification of the total amount of
16-5 salary paid above the statutory minimum salary and the total amount
16-6 of employer contributions due under this section for the payroll
16-7 period; and
16-8 (2) retain information, as determined by the
16-9 retirement system, sufficient to allow administration of this
16-10 section [The employer's form showing deductions and certification
16-11 of earnings must provide the retirement system with information
16-12 sufficient to administer this section, as determined by the
16-13 system], including information for each employee showing the
16-14 applicable minimum salary as well as aggregate annual compensation.
16-15 SECTION 21. Subsection (c), Section 825.406, Government
16-16 Code, is amended to read as follows:
16-17 (c) Monthly, employers shall:
16-18 (1) report to the retirement system in a form
16-19 prescribed by the system a certification of the total amount of
16-20 salary paid from federal funds and private grants and the total
16-21 amounts provided by the funds and grants for state contributions
16-22 for the employees; and
16-23 (2) retain the following information:
16-24 (A) [(1)] the name of each employee paid in
16-25 whole or part from a grant;
16-26 (B) [(2)] the source of the grant;
17-1 (C) [(3)] the amount of the employee's salary
17-2 paid from the grant;
17-3 (D) [(4)] the amount of the money provided by
17-4 the grant for state contributions for the employee; and
17-5 (E) [(5)] any other information the retirement
17-6 system determines is necessary to enforce this section.
17-7 SECTION 22. Subsection (c), Section 825.407, Government
17-8 Code, is amended to read as follows:
17-9 (c) The designated disbursing officer of each general
17-10 academic teaching institution and the designated disbursing officer
17-11 of each medical and dental unit shall:
17-12 (1) submit to the retirement system, at a time and in
17-13 the manner prescribed by the retirement system, a monthly report
17-14 containing a certification of the total amount of salary paid from
17-15 noneducational and general funds and the total amount of employer
17-16 contributions due under this section for the payroll period; and
17-17 (2) maintain and retain the following information:
17-18 (A) [(1)] the name of each member employed by
17-19 the institution or unit who, for the most recent payroll period,
17-20 was paid wholly or partly from noneducational and general funds;
17-21 (B) [(2)] the amount of the employee's salary
17-22 for the most recent payroll period that was paid from
17-23 noneducational and general funds;
17-24 [(3) a certification of the total amount of employer
17-25 contributions due under this section for the payroll period;] and
17-26 (C) [(4)] any other information the retirement
18-1 system determines is necessary to administer this section.
18-2 SECTION 23. Subsection (a), Section 825.408, Government
18-3 Code, is amended to read as follows:
18-4 (a) An employing district that fails to remit, before the
18-5 11th day after the last day of a month, all member and employer
18-6 deposits and documentation of the deposits required by this
18-7 subchapter to be remitted by the district for the month shall pay
18-8 to the retirement system, in addition to the deposits, interest on
18-9 the unpaid or undocumented amounts at an annual rate compounded
18-10 monthly. The rate of interest is the rate established under
18-11 Section 825.313(b)(2), plus two percent. Interest required under
18-12 this section is creditable to the interest account.
18-13 SECTION 24. Section 825.515, Government Code, is amended to
18-14 read as follows:
18-15 Sec. 825.515. INFORMATION ABOUT MEMBER POSITIONS. (a) At
18-16 least annually, the [The] retirement system shall acquire and
18-17 maintain records identifying members and the types of positions
18-18 they hold [have held] as members[, the length of service in each
18-19 type of position, and whether service in each type of position is
18-20 or was as a full-time employee]. The type of position shall be
18-21 identified as Administrative/Professional, Teacher/Full-Time
18-22 Librarian, Support, or Bus Driver. [The retirement system shall
18-23 cooperate with the commissioner of education in maintaining
18-24 information about the employment status of members of the
18-25 retirement system.]
18-26 (b) [Each school year, the retirement system shall provide
19-1 to the commissioner of education information, of a type and in a
19-2 form determined by the commissioner, that allows contributing
19-3 members of the retirement system to be identified in information
19-4 submitted to the commissioner by school districts under the
19-5 Education Code.]
19-6 [(c)] Information contained in records of the retirement
19-7 system maintained under this section is confidential within the
19-8 limits prescribed by Section 825.507.
19-9 SECTION 25. Subsections (a) and (b), Section 825.516,
19-10 Government Code, are amended to read as follows:
19-11 (a) A retiree who is receiving an annuity from the
19-12 retirement system may request the system to withhold from the
19-13 retiree's monthly annuity payment membership dues for a nonprofit
19-14 association of retired school employees in this state, if the
19-15 association is statewide and its membership includes at least five
19-16 percent of all retirees of the retirement system. The request for
19-17 withholding must be on a form provided by the retirement system.
19-18 (b) After the retirement system receives a request
19-19 authorized by this section, the system may [shall] make the
19-20 requested deductions until the earlier of:
19-21 (1) the date the annuity is terminated; or
19-22 (2) the first payment of the annuity after the date
19-23 the system receives a written request signed by the retiree
19-24 canceling the request for the withholding.
19-25 SECTION 26. Subsection (d), Section 16A, Article 3.50-4,
19-26 Insurance Code, is amended to read as follows:
20-1 (d) Monthly, employers shall:
20-2 (1) report to the trustee in a form prescribed by the
20-3 trustee a certification of the total amount of salary paid from
20-4 federal funds and private grants and the total amounts provided by
20-5 the funds and grants for state contributions for the employees; and
20-6 (2) maintain and retain the following information:
20-7 (A) [(1)] the name of each [active] employee
20-8 paid in whole or part from a grant;
20-9 (B) [(2)] the source of the grant;
20-10 (C) [(3)] the amount of the [active] employee's
20-11 salary paid from the grant;
20-12 (D) [(4)] the amount of the money provided by
20-13 the grant for state contributions for the [active] employee; and
20-14 (E) [(5)] any other information the trustee
20-15 determines is necessary to enforce this section.
20-16 SECTION 27. Subchapter E, Chapter 3, Insurance Code, is
20-17 amended by adding Article 3.50-4A to read as follows:
20-18 Art. 3.50-4A. INSURANCE FOR SCHOOL DISTRICT EMPLOYEES AND
20-19 RETIREES
20-20 Sec. 1. DEFINITIONS. In this article:
20-21 (1) "Employee" means a person who is a participating
20-22 member of the Teacher Retirement System of Texas and is not
20-23 participating in a group insurance program under the Texas
20-24 Employees Uniform Group Insurance Benefits Act (Article 3.50-2,
20-25 Vernon's Texas Insurance Code) or the Texas State College and
20-26 University Employees Uniform Insurance Benefits Act (Article
21-1 3.50-3, Vernon's Texas Insurance Code).
21-2 (2) "Retiree" means a person who:
21-3 (A) has retired under the Teacher Retirement
21-4 System of Texas with at least 10 years of credit for service in
21-5 public schools of this state or has retired under that system for
21-6 disability and is entitled to receive an annuity from the system
21-7 based on the person's service; and
21-8 (B) is not eligible to participate in the group
21-9 insurance program provided under the Texas Employees Uniform Group
21-10 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
21-11 Code) or the Texas State College and University Employees Uniform
21-12 Insurance Benefits Act (Article 3.50-3, Vernon's Texas Insurance
21-13 Code).
21-14 (3) "Trustee" means the Teacher Retirement System of
21-15 Texas.
21-16 Sec. 2. INSURANCE COVERAGE. (a) The trustee shall contract
21-17 with one or more carriers authorized to provide life insurance in
21-18 this state to offer employees and retirees optional permanent life
21-19 insurance coverage.
21-20 (b) The trustee shall contract with one or more carriers
21-21 authorized to provide long-term care insurance in this state to
21-22 offer employees and retirees optional long-term care insurance
21-23 coverage. The long-term care insurance coverage shall include
21-24 home, community, and institutional care.
21-25 (c) The trustee shall contract with one or more carriers
21-26 authorized to provide disability insurance in this state to offer
22-1 employees optional insurance against short-term or long-term loss
22-2 of salary because of disability.
22-3 (d) In contracting for any benefits under this article,
22-4 competitive bidding shall be required under rules adopted by the
22-5 trustee. The rules may provide criteria to determine qualified
22-6 carriers. The trustee is not required to select the lowest bid but
22-7 also may consider ability to service contracts, past experiences,
22-8 financial stability, and other relevant criteria. If the trustee
22-9 awards a contract to an entity whose bid deviates from that
22-10 advertised, the deviation shall be recorded and the reasons for the
22-11 deviation shall be fully justified in the minutes of the next
22-12 meeting of the trustee.
22-13 (e) Insurance coverage provided under this section shall be
22-14 made available periodically during open enrollment periods
22-15 determined by the trustee.
22-16 Sec. 3. ADMINISTRATION. (a) The trustee shall adopt rules
22-17 for the selection of contractors under this article. The rules
22-18 must require the contractors to administer enrollment, adjudication
22-19 of claims, and coordination of services under the insurance
22-20 coverages and require the contractors to account for premiums
22-21 collected and disbursed under the coverages.
22-22 (b) The trustee may adopt other rules necessary to
22-23 administer the program provided under this article.
22-24 Sec. 4. PARTICIPATION IN COVERAGE. (a) The trustee shall
22-25 offer the coverages provided under this article to employees
22-26 through their employers and to retirees through the trustee's
23-1 administration of the retirement system.
23-2 (b) The full cost of premiums in a plan of insurance
23-3 coverage provided under this article is the responsibility of the
23-4 enrollees.
23-5 (c) An employee participating in a plan of insurance
23-6 coverage provided under this article shall pay premiums by payroll
23-7 deduction remitted by the employee's employer at the times and in
23-8 the manner provided by the trustee.
23-9 (d) A retiree participating in a plan of insurance coverage
23-10 provided under this article shall pay premiums by deduction from
23-11 the retiree's monthly retirement annuity.
23-12 Sec. 5. SCHOOL DISTRICT EMPLOYEES AND RETIREES OPTIONAL
23-13 INSURANCE TRUST FUND. (a) The school district employees and
23-14 retirees optional insurance trust fund is created as a trust fund
23-15 with the comptroller and shall be administered by the trustee on
23-16 behalf of the participants in the plans of insurance coverage
23-17 provided under this article.
23-18 (b) Premiums paid by enrollees, amounts recovered under
23-19 contracts for the implementation of the program provided by this
23-20 article, and investment and depository income of the fund shall be
23-21 credited to the fund.
23-22 (c) Money in the fund may be used only for the purpose of
23-23 providing the program of insurance coverage provided under this
23-24 article, including the expenses of administering the program.
23-25 (d) The trustee may invest the fund in the manner provided
23-26 by Section 67(a)(3), Article XVI, Texas Constitution.
24-1 SECTION 28. Subsections (c) and (d), Section 22.004,
24-2 Education Code, are amended to read as follows:
24-3 (c) Each district shall report the district's compliance
24-4 with this subsection to the executive director of the Teacher
24-5 Retirement System of Texas not later than March [November] 1 of
24-6 each even-numbered year in the manner required by the board of
24-7 trustees of the Teacher Retirement System of Texas. The report
24-8 must be based on the district group health coverage plan in effect
24-9 during the current plan year [on November 1] and must include:
24-10 (1) appropriate documentation of:
24-11 (A) the district's contract for group health
24-12 coverage with a provider licensed to do business in this state by
24-13 the Texas Department of Insurance or a risk pool authorized under
24-14 Chapter 172, Local Government Code; or
24-15 (B) a resolution of the board of trustees of the
24-16 district authorizing a self-insurance plan for district employees
24-17 and of the district's review of district ability to cover the
24-18 liability assumed;
24-19 (2) the schedule of benefits;
24-20 (3) the premium rate sheet, including the amount paid
24-21 by the district and employee;
24-22 (4) the number of employees covered by each health
24-23 coverage plan offered by the district; and
24-24 (5) any other information considered appropriate by
24-25 the executive director of the Teacher Retirement System of Texas.
24-26 (d) Based on the criteria prescribed by Subsection (a), the
25-1 executive director of the Teacher Retirement System of Texas shall
25-2 certify whether a district's coverage is comparable to the basic
25-3 health coverage provided under the Texas Employees Uniform Group
25-4 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
25-5 Code). If the executive director of the Teacher Retirement System
25-6 of Texas determines that the group health coverage offered by a
25-7 district is not comparable, the executive director shall report
25-8 that information to the district and to the Legislative Budget
25-9 Board. The executive director shall submit a report to the
25-10 legislature not later than September [January] 1 of each
25-11 even-numbered [odd numbered] year describing the status of each
25-12 district's group health coverage program based on the information
25-13 contained in the report required by Subsection (c) and the
25-14 certification required by this subsection.
25-15 SECTION 29. (a) Monthly payments of a death or retirement
25-16 benefit annuity by the Teacher Retirement System of Texas are
25-17 increased beginning with the payment due at the end of September
25-18 1999.
25-19 (b) The increase does not apply to payments under Subsection
25-20 (a), Section 824.304, Section 824.404, or Section 824.501,
25-21 Government Code.
25-22 (c) Except as provided by Subsection (d) of this section,
25-23 the amount of the monthly increase is computed by multiplying the
25-24 previous monthly benefit by a percentage determined in accordance
25-25 with the following table:
25-26 LATEST RETIREMENT DATE OR,
26-1 IF APPLICABLE, DATE OF DEATH INCREASE
26-2 Before September 1, 1973 5%
26-3 On or after September 1, 1973, but before September 1, 1974 6%
26-4 On or after September 1, 1974, but before September 1, 1979 5%
26-5 On or after September 1, 1979, but before September 1, 1981 6%
26-6 On or after September 1, 1981, but before September 1, 1982 7%
26-7 On or after September 1, 1982, but before September 1, 1983 6%
26-8 On or after September 1, 1983, but before September 1, 1990 7%
26-9 On or after September 1, 1990, but before September 1, 1991 6%
26-10 On or after September 1, 1991, but before September 1, 1992 7%
26-11 On or after September 1, 1992, but before September 1, 1995 6%
26-12 On or after September 1, 1995, but before September 1, 1997 5%
26-13 On or after September 1, 1997, but before September 1, 1998 2%
26-14 (d) After making the computations required by Subsection (c)
26-15 of this section, the Teacher Retirement System of Texas shall
26-16 increase each annuity payable by the system on September 1, 1999,
26-17 other than an annuity under Subsection (a), Section 824.304,
26-18 Section 824.404, or Section 824.501, Government Code, by 10
26-19 percent, which is a benefit equivalent to the benefit provided by
26-20 using a 2.2 percent multiplier for computing annuities.
26-21 SECTION 30. (a) Notwithstanding Section 824.1011,
26-22 Government Code, as amended by this Act, a person who is receiving
26-23 a standard service or disability retirement annuity under Section
26-24 824.203 or Subsection (b), Section 824.304, Government Code, on the
26-25 effective date of this Act and who married after retirement but
26-26 before that date may, before September 1, 2000, replace the annuity
27-1 by selecting an optional annuity and designating the person's
27-2 spouse as beneficiary as if the person had married after the
27-3 effective date of this Act.
27-4 (b) Notwithstanding Section 824.1011, Government Code, as
27-5 amended by this Act, a person who retired before September 1, 1992,
27-6 and is receiving a standard disability retirement annuity under
27-7 Subsection (b), Section 824.304, Government Code, on the effective
27-8 date of this Act may before September 1, 2001, replace the annuity
27-9 by selecting an optional annuity described by Section 824.308,
27-10 Government Code. An optional annuity selected under this
27-11 subsection shall be actuarially reduced according to the ages of
27-12 the retiree and the designated beneficiary at the time the annuity
27-13 is selected.
27-14 SECTION 31. This Act takes effect September 1, 1999, except
27-15 Section 14, which takes effect at the beginning of the 1999-2000
27-16 school year.
27-17 SECTION 32. The importance of this legislation and the
27-18 crowded condition of the calendars in both houses create an
27-19 emergency and an imperative public necessity that the
27-20 constitutional rule requiring bills to be read on three several
27-21 days in each house be suspended, and this rule is hereby suspended,
27-22 and that this Act take effect and be in force according to its
27-23 terms, and it is so enacted.
S.B. No. 1128
________________________________ ________________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 1128 passed the Senate on
April 28, 1999, by a viva-voce vote; May 18, 1999, Senate refused
to concur in House amendments and requested appointment of
Conference Committee; May 20, 1999, House granted request of the
Senate; May 30, 1999, Senate adopted Conference Committee Report by
the following vote: Yeas 30, Nays 0.
_______________________________
Secretary of the Senate
I hereby certify that S.B. No. 1128 passed the House, with
amendments, on May 14, 1999, by a non-record vote; May 20, 1999,
House granted request of the Senate for appointment of Conference
Committee; May 30, 1999, House adopted Conference Committee Report
by a non-record vote.
_______________________________
Chief Clerk of the House
Approved:
________________________________
Date
________________________________
Governor