AN ACT
1-1 relating to participation and credit in, contributions to, and
1-2 benefits and administration of the Texas County and District
1-3 Retirement System.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 841.001, Government Code, is amended by
1-6 amending Subdivision (5) and adding Subdivisions (16) and (17) to
1-7 read as follows:
1-8 (5) "Compensation" means the payments that do not
1-9 exceed $150,000 in a calendar year, indexed in the same manner as
1-10 is provided by Section 401(a)(17) of the Internal Revenue Code of
1-11 1986 (26 U.S.C. Section 417) and that are made to an employee of a
1-12 participating subdivision by the subdivision for service, including
1-13 nonmonetary compensation, the value of which is determined by the
1-14 governing body of the subdivision. The term does not include
1-15 workers' compensation benefits received by a member under Section
1-16 504.011, Labor Code.
1-17 (16) "Supplemental death benefit program" means the
1-18 voluntary, employer-funded optional death benefits program under
1-19 Subchapter F, Chapter 844. The program constitutes "group-term
1-20 life insurance purchased for employees" as described by Section 79
1-21 of the Internal Revenue Code of 1986.
1-22 (17) "Vested member" means a member who may withdraw
1-23 from employment with all participating subdivisions, leave the
1-24 member's accumulated contributions on deposit with the retirement
2-1 system, and, on meeting the age and length-of-service requirements
2-2 for service retirement, file an application for retirement and
2-3 begin to receive a service retirement benefit.
2-4 SECTION 2. Section 842.004, Government Code, is amended by
2-5 adding a new Subsection (e) and redesignating former Subsection (e)
2-6 as Subsection (f) to read as follows:
2-7 (e) If before November 1 of any year a subdivision gives
2-8 written notice of its intention to the retirement system, the
2-9 subdivision may terminate coverage under and discontinue
2-10 participation in the supplemental death benefits fund. A
2-11 termination under this subsection is effective on January 1 of the
2-12 year following the year in which notice is given.
2-13 (f) If a subdivision has previously discontinued
2-14 participation in the fund, the board of trustees in its discretion
2-15 may restrict the right of the subdivision to participate again.
2-16 SECTION 3. Subchapter A, Chapter 842, Government Code, is
2-17 amended by adding Section 842.008 to read as follows:
2-18 Sec. 842.008. NO PARTICIPATION FOR EMPLOYEES HIRED AFTER
2-19 ELECTION. (a) A participating subdivision may not terminate
2-20 participation in the retirement system as long as it has any
2-21 liabilities resulting from the participation of current or former
2-22 employees, but it may elect to discontinue enrolling in the
2-23 retirement system nonmembers whose employment or reemployment
2-24 begins after the effective date of an election to discontinue
2-25 enrollment. If the subdivision has an annually determined
2-26 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 retirement
3-17 system. If the ratio of the sum of the assets and the actuarial
3-18 present value of future subdivision contributions in excess of
3-19 normal costs, if any, to the actuarial present value of current
3-20 service credits is less than one-to-one, the credits shall be
3-21 proportionally reduced. The ratio shall be redetermined annually
3-22 and adjustments 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
4-1 excess of normal costs, if any, for this priority group remaining
4-2 after the allocation described by Subsection (c) to the actuarial
4-3 present value of second priority benefits is less than one-to-one,
4-4 the annuities and credits may all have to be proportionally
4-5 reduced. If the ratio is greater than one-to-one, the annuities
4-6 and credits may all have to be proportionally increased, except as
4-7 limited by Subsection (f). The ratio shall be redetermined
4-8 annually, and reductions or increases in the annuities and credits
4-9 shall be made when considered appropriate to bring the ratio closer
4-10 to one-to-one.
4-11 (e) A subdivision whose assets in the retirement system have
4-12 been allocated under Subsection (b) may not enroll new members
4-13 unless the subdivision applies to the board of trustees for
4-14 approval and receives it. The board of trustees may not grant
4-15 approval unless the subdivision adopts an order or resolution on
4-16 the terms provided by Subchapter H, Chapter 844.
4-17 (f) If the participating subdivision is not enrolling new
4-18 members in accordance with Subsection (e), the annuities and
4-19 credits described by Subsections (c) and (d) may not be increased
4-20 to a level that exceeds the greater of the level in effect
4-21 immediately before the time Subsection (b) became applicable or the
4-22 level in effect on December 31, 1992.
4-23 (g) When the participating subdivision or its successor has
4-24 no employees who are members of the retirement system and has no
4-25 present or potential liabilities resulting from the participation
4-26 of former employees, the subdivision's participation in the
5-1 retirement system ceases, and the system shall repay to the
5-2 subdivision or its successor the amount in the subdivision
5-3 accumulation fund that is credited to the subdivision. If the
5-4 participating subdivision is no longer in existence and has no
5-5 successor when its participation ceases, the amount in the
5-6 subdivision accumulation fund that is credited to the subdivision
5-7 shall be transferred to the general reserves account of the
5-8 endowment fund.
5-9 (h) If a subdivision whose assets in the retirement system
5-10 have been allocated under Subsection (b) is allowed to begin
5-11 enrolling new members in accordance with Subsection (e), the
5-12 annuities and credits described by Subsections (c) and (d)
5-13 attributable to contributions made by members before the date the
5-14 subdivision begins enrolling new members:
5-15 (1) must be restored to the level in effect
5-16 immediately before Subsection (b) became applicable unless they
5-17 already equal or exceed that level; and
5-18 (2) may not be increased above the greater of the
5-19 level in effect immediately before Subsection (b) became applicable
5-20 or the level in effect immediately before the subdivision began
5-21 enrolling new members until the expiration of four calendar years
5-22 after the date the subdivision begins enrolling new members.
5-23 (i) Before or after the initial allocation under Subsection
5-24 (b) is determined, the subdivision may elect to contribute a
5-25 lump-sum deposit or may elect to contribute in all future years
5-26 that the allocation described by Subsection (b) is necessary at an
6-1 integer percent greater than the rate being paid at the time of the
6-2 election of the integer percent, notwithstanding the provisions of
6-3 Section 844.605 or 844.703.
6-4 SECTION 4. Subchapter A, Chapter 842, Government Code, is
6-5 amended by adding Section 842.009 to read as follows:
6-6 Sec. 842.009. SIGNIFICANT REDUCTION IN NUMBER OF
6-7 CONTRIBUTING MEMBERS. (a) If a participating subdivision reduces
6-8 the number of members in its employment by at least 26 percent but
6-9 less than 100 percent, or by 100 percent if the reduction is
6-10 expected to last less than 12 months, over the 12-month period
6-11 ending with the preceding December, no other participating
6-12 subdivision has assumed funding of the obligations, and the actuary
6-13 recommends to the board of trustees and the board agrees that this
6-14 subsection shall be applied, the assets in that subdivision's
6-15 account in the subdivision accumulation fund shall be allocated
6-16 under the priorities provided by this section, with the details of
6-17 the allocation to be determined by the actuary and approved by the
6-18 board of trustees.
6-19 (b) If the subdivision has an annually determined
6-20 contribution rate plan, the subdivision must elect to contribute in
6-21 all future years in which the allocation described by Subsection
6-22 (a) is necessary at a rate that is either the rate being paid at
6-23 the time Subsection (a) is applied or an integer percent greater
6-24 than the rate being paid at the time Subsection (a) is applied.
6-25 (c) First priority shall be given to current service credit
6-26 of all members who leave their contributions in the retirement
7-1 system. If the ratio of the sum of the assets and the actuarial
7-2 present value of future subdivision contributions in excess of
7-3 normal costs, if any, to the actuarial present value of current
7-4 service credits is less than one-to-one, the credits shall be
7-5 proportionally reduced. The ratio shall be redetermined annually
7-6 and adjustments made as needed.
7-7 (d) Second priority shall be given to prior service credit,
7-8 multiple matching credit, and supplemental annuities, without
7-9 differentiation. If the ratio of the sum of the assets and the
7-10 actuarial present value of future subdivision contributions in
7-11 excess of normal costs, if any, for this priority group remaining
7-12 after the allocation described by Subsection (c) to the actuarial
7-13 present value of second priority benefits is less than one-to-one,
7-14 the annuities and credits may all have to be proportionally
7-15 reduced. If the ratio is greater than one-to-one, the annuities
7-16 and credits may all have to be proportionally increased, except as
7-17 limited by Subsection (e). The ratio shall be redetermined
7-18 annually, and reductions or increases in the annuities and credits
7-19 shall be made when considered appropriate to bring the ratio closer
7-20 to one-to-one.
7-21 (e) If the actuary has not recommended and the board of
7-22 trustees has not approved ending the allocation described by
7-23 Subsection (a), the annuities and credits described by Subsections
7-24 (c) and (d) may not be increased to a level that exceeds the level
7-25 in effect immediately before Subsection (a) became applicable.
7-26 (f) If the allocation described by Subsection (a) has been
8-1 ended by action of the board of trustees on the recommendation of
8-2 the actuary, the annuities and credits described by Subsections (c)
8-3 and (d) attributable to contributions made by members before the
8-4 date the allocation was ended:
8-5 (1) must be restored to the level in effect
8-6 immediately before Subsection (a) became applicable unless they
8-7 already equal that level; and
8-8 (2) may not be increased above the level in effect
8-9 immediately before Subsection (a) became applicable until the
8-10 expiration of four calendar years after the allocation ended.
8-11 (g) Before or after the initial allocation under Subsection
8-12 (a) is determined, the subdivision may elect to contribute a
8-13 lump-sum deposit or may elect to contribute in all future years
8-14 that the allocation described by Subsection (a) is necessary at an
8-15 integer percent greater than the rate being paid at the time of the
8-16 election of the integer percent, notwithstanding the provisions of
8-17 Section 844.605 and Section 844.703.
8-18 SECTION 5. Subchapter A, Chapter 842, Government Code, is
8-19 amended by adding Section 842.010 to read as follows:
8-20 Sec. 842.010. REDUCTION TO NO CONTRIBUTING MEMBERS. (a) If
8-21 a participating subdivision is abolished or reduces the number of
8-22 members in its employment to zero, with the reduction expected to
8-23 last at least 12 months, so that it no longer contributes to the
8-24 retirement system and no other participating subdivision has
8-25 assumed funding of the obligations, the assets in that
8-26 subdivision's account in the subdivision accumulation fund shall be
9-1 allocated under the priorities provided by this section, with the
9-2 details of the allocation to be determined by the actuary and
9-3 approved by the board of trustees. Service retirement will be
9-4 allowed at age 60 with at least four years of credited service.
9-5 (b) First priority shall be given to current service credit
9-6 of all members who leave their contributions in the retirement
9-7 system. If the ratio of the assets to the actuarial present value
9-8 of current service credits is less than one-to-one, the credits
9-9 shall be proportionally reduced. The ratio shall be redetermined
9-10 annually and adjustments made as needed.
9-11 (c) Second priority shall be given to prior service credit,
9-12 multiple matching credit, and supplemental annuities, without
9-13 differentiation. If the ratio of the assets for this priority
9-14 group remaining after the allocation described by Subsection (b) to
9-15 the actuarial present value of second priority benefits is less
9-16 than one-to-one, the annuities and credits may all have to be
9-17 proportionally reduced. If the ratio is greater than one-to-one,
9-18 the annuities and credits may all have to be proportionally
9-19 increased, except as limited by Subsection (e). The ratio shall be
9-20 redetermined annually, and reductions or increases in the annuities
9-21 and credits shall be made when considered appropriate to bring the
9-22 ratio closer to one-to-one.
9-23 (d) A subdivision whose assets in the retirement system have
9-24 been allocated under Subsection (a) may not enroll new members
9-25 unless the subdivision applies to the board of trustees for
9-26 approval and receives it. The board of trustees may not grant
10-1 approval unless the subdivision adopts an order or resolution on
10-2 the terms provided by Subchapter H, Chapter 844.
10-3 (e) If the participating subdivision is not enrolling new
10-4 members in accordance with Subsection (d), the annuities and
10-5 credits described by Subsections (b) and (c) may not be increased
10-6 to a level that exceeds the level in effect immediately before
10-7 Subsection (a) became applicable.
10-8 (f) When the participating subdivision or its successor has
10-9 no employees who are members of the retirement system and has no
10-10 present or potential liabilities resulting from the participation
10-11 of former employees, the subdivision's participation in the
10-12 retirement system ceases, and the system shall repay to the
10-13 subdivision or its successor the amount in the subdivision
10-14 accumulation fund that is credited to the subdivision. If the
10-15 participating subdivision is no longer in existence and has no
10-16 successor when its participation ceases, the amount in the
10-17 subdivision accumulation fund that is credited to the subdivision
10-18 shall be transferred to the general reserves account of the
10-19 endowment fund.
10-20 (g) If a subdivision whose assets in the retirement system
10-21 have been allocated under Subsection (a) is allowed to begin
10-22 enrolling new members in accordance with Subsection (d), the
10-23 annuities and credits described by Subsections (b) and (c)
10-24 attributable to contributions made by members before the date the
10-25 subdivision begins enrolling new members:
10-26 (1) must be restored to the level in effect
11-1 immediately before Subsection (a) became applicable unless they
11-2 already equal that level; and
11-3 (2) may not be increased above the level in effect
11-4 immediately before Subsection (a) became applicable until the
11-5 expiration of four calendar years after the date the subdivision
11-6 begins enrolling new members.
11-7 (h) Before the initial allocation under Subsection (a) is
11-8 determined, the subdivision may elect to contribute a lump-sum
11-9 deposit.
11-10 SECTION 6. Section 842.105, Government Code, is amended to
11-11 read as follows:
11-12 Sec. 842.105. STATUS AS AN EMPLOYEE. For the purposes of
11-13 this subtitle, a person has the standing of an employee in a
11-14 participating subdivision if the person:
11-15 (1) is employed in a position that normally requires
11-16 services from the person for not less than 900 hours a year by a
11-17 community supervision and corrections [judicial district probation]
11-18 department that has executed a contract with the participating
11-19 subdivision under Section 76.006, Government Code [Article 42.12,
11-20 Code of Criminal Procedure]; or
11-21 (2) is eligible for optional membership in the
11-22 retirement system under Subchapter C.
11-23 SECTION 7. Subsection (a), Section 842.106, Government Code,
11-24 is amended to read as follows:
11-25 (a) Except as provided by this section, a person who is
11-26 [not] an employee eligible for membership and is [not] eligible to
12-1 receive credit in this retirement system for service performed for
12-2 a subdivision is not [that makes a person] eligible for credit for
12-3 that service [membership or is creditable] in another pension fund
12-4 or retirement system that is at least partly supported at public
12-5 expense. It is the responsibility of the subdivision to enforce
12-6 this provision.
12-7 SECTION 8. Subsection (a), Section 842.108, Government Code,
12-8 is amended to read as follows:
12-9 (a) A person who is not an employee of any participating
12-10 subdivision and who has not retired may, by written [after]
12-11 application, withdraw from membership in the retirement system, and
12-12 the person's account will be closed and the person will be paid:
12-13 (1) the accumulated contributions in the member's
12-14 individual account in the employees saving fund; plus
12-15 (2) interest computed from the beginning of the
12-16 calendar year of withdrawal through the end of the month before the
12-17 month in which withdrawal occurs on the balance in the member's
12-18 individual account in the employees saving fund on January 1 of the
12-19 year of withdrawal [all of the accumulated contributions credited
12-20 to the person's individual account in the employees saving fund,
12-21 and the retirement system shall close the account].
12-22 SECTION 9. Section 842.109, Government Code, is amended to
12-23 read as follows:
12-24 Sec. 842.109. TERMINATION OF MEMBERSHIP. (a) A person
12-25 terminates membership in the retirement system by:
12-26 (1) death;
13-1 (2) retirement;
13-2 (3) withdrawal of all of the person's contributions
13-3 while absent from service; or
13-4 (4) absence from service for five consecutive years
13-5 [or more either before accumulating enough credited service to
13-6 enable the person to retire without additional service or] before
13-7 accumulating four or more years of credited service [with one or
13-8 more subdivisions that have adopted a program allowing retirement
13-9 without additional service after accumulation of 12 years of
13-10 credited service].
13-11 (b) A member of the retirement system is not absent from
13-12 service and continues to accumulate membership credited service if
13-13 the person[:]
13-14 [(1)] leaves employment with a participating
13-15 subdivision to perform and does perform qualified military service
13-16 in the uniformed services, as that term is defined in the Uniformed
13-17 Services Employment and Reemployment Rights Act of 1994 (38 U.S.C.
13-18 Section 4301 et seq.), that meets the requirements of that Act
13-19 [active duty service in the armed forces or the armed forces
13-20 reserves of the United States or an auxiliary of the armed forces
13-21 or reserves,] and if:
13-22 (1) [(A)] the person applies for reemployment with the
13-23 same subdivision not later than the 90th day after the date the
13-24 person is [released from active duty or] discharged from military
13-25 service under honorable conditions or released from hospitalization
13-26 continuing after being discharged under honorable conditions
14-1 [release or discharge] for a period of not more than two years [one
14-2 year]; and
14-3 (2) [(B)] the person is reemployed by the same
14-4 participating subdivision[; or]
14-5 [(2) is conscripted and leaves employment with a
14-6 participating subdivision to perform and does perform war-related
14-7 service during a state of war or conflict between the armed forces
14-8 of the United States and a foreign country, and if the person
14-9 applies for and is reemployed by the same subdivision not later
14-10 than the 90th day after the date the person is released from active
14-11 duty or discharged from military service].
14-12 (c) On any termination of membership in the retirement
14-13 system, a person forfeits all credited service established in the
14-14 retirement system.
14-15 SECTION 10. Subsection (f), Section 842.110, Government
14-16 Code, is amended to read as follows:
14-17 (f) If a person with credited service under this section
14-18 dies before a payment under Subsection (g) is made, the person's
14-19 beneficiary, or if there is no beneficiary surviving, the person's
14-20 spouse, or if there is no surviving spouse, the executor or
14-21 administrator of the person's estate, may elect payment as provided
14-22 by Section 844.407 [844.105(c)].
14-23 SECTION 11. Subsection (c), Section 842.111, Government
14-24 Code, is amended to read as follows:
14-25 (c) If a person with credited service under this section
14-26 dies before a payment under Subsection (d) is made, the person's
15-1 beneficiary or, if no beneficiary survives, the person's spouse, or
15-2 if there is no surviving spouse, the executor or administrator of
15-3 the person's estate, may elect payment as provided by Section
15-4 844.407 [844.105(c)].
15-5 SECTION 12. Section 842.112, Government Code, is amended by
15-6 amending Subsection (c) and adding Subsection (i) to read as
15-7 follows:
15-8 (c) Except as provided by Subsection (i), a [A] correction
15-9 may not be made unless the retirement system receives, in addition
15-10 to the application, each of the items required under Subsections
15-11 (d), (e), and (f), and one of the following:
15-12 (1) a written agreement, approved by the subdivision's
15-13 governing body, stating that an error has occurred and that the
15-14 subdivision has agreed to correct that [the] error;
15-15 (2) a final judgment by a court of competent
15-16 jurisdiction in proceedings to which the subdivision was a party,
15-17 ordering that the subdivision correct the error; or
15-18 (3) an order in an administrative proceeding to which
15-19 the subdivision was a party, directing that the subdivision correct
15-20 the error, that is no longer subject to appeal.
15-21 (i) The correction of an error affecting not more than three
15-22 monthly reports within a period of not more than three consecutive
15-23 months may be made on the basis of the application alone if the
15-24 application, the supplemental report, and the payment required by
15-25 this section are received by the retirement system within six
15-26 months after the first day of the first month for which the
16-1 correction is being made.
16-2 SECTION 13. Section 842.112, Government Code, is amended by
16-3 adding Subsections (j) and (k) to read as follows:
16-4 (j) If, as a result of a suit against a participating
16-5 subdivision in a court of competent jurisdiction, a person receives
16-6 a judgment against a subdivision ordering that the person be
16-7 reinstated as an employee of the subdivision retroactively to the
16-8 date the person's employment was terminated and ordering that the
16-9 person receive credit toward retirement for the reinstated service,
16-10 on written application to the retirement system, the system shall
16-11 grant the service credit if:
16-12 (1) the judgment has become final and is no longer
16-13 subject to appeal;
16-14 (2) a certified copy of the judgment accompanies the
16-15 application;
16-16 (3) the retirement system receives payment from the
16-17 person in an amount equal to the contributions the person would
16-18 have made to the system if the employment had not been terminated
16-19 and the service reported to the system; and
16-20 (4) the retirement system receives payment from the
16-21 subdivision in an amount equal to the additional contributions that
16-22 the subdivision would have made to the system for the additional
16-23 credited service.
16-24 (k) If a person to whom Subsection (j) applies has forfeited
16-25 service credit as a result of withdrawal of contributions during
16-26 the time between the termination of employment and the date of
17-1 reinstatement, the person is eligible to reestablish credit under
17-2 Section 843.003. For purposes of this subsection, forfeited credit
17-3 based on service performed for more than one participating
17-4 subdivision is considered to have been credit for service performed
17-5 only for the subdivision that is subject to the judgment, except
17-6 that credit may not be reinstated under this subsection for service
17-7 performed after the date of the termination of employment that
17-8 resulted in the judgment.
17-9 SECTION 14. Subsection (d), Section 843.105, Government
17-10 Code, is amended to read as follows:
17-11 (d) Interest is earned [for each whole year] on an allocated
17-12 prior service credit from the effective date of membership to the
17-13 effective date of retirement at the applicable rate for the period
17-14 as provided by Section 845.314.
17-15 SECTION 15. Subsection (d), Section 843.201, Government
17-16 Code, is amended to read as follows:
17-17 (d) Allocated prior service credits are allowable for a
17-18 subdivision only if [the retirement system's actuary certifies
17-19 that]:
17-20 (1) [the subdivision contribution rate will not exceed
17-21 the employee contribution rate plus three percent, if] the
17-22 subdivision has adopted the provisions for an annually determined
17-23 contribution rate plan under Subchapter H, Chapter 844; or
17-24 (2) the retirement system's actuary determines that
17-25 the subdivision's unfunded actuarial accrued liability amortization
17-26 period will be less than 25 years, if the subdivision has not
18-1 adopted the provisions of Subchapter H, Chapter 844.
18-2 SECTION 16. Subsection (a), Section 843.203, Government
18-3 Code, is amended to read as follows:
18-4 (a) The governing body of a subdivision that has taken over
18-5 the facilities of a hospital, utility, or other public facility
18-6 formerly operated by another participating subdivision may assume
18-7 in whole or in part the obligations that the former employer had
18-8 undertaken under this subtitle by reason of service performed by
18-9 members of the system who become employees of the subdivision
18-10 seeking to participate in the system. A subdivision participating
18-11 in the system that could have assumed the obligations of another
18-12 subdivision had this section been in effect at time of
18-13 participation may assume in whole or in part the obligations that
18-14 the subdivision that was the first employer had undertaken by
18-15 reason of service rendered by members who became employees of the
18-16 subdivision that is the second employer. The governing body of a
18-17 subdivision that assumes the obligations of another subdivision
18-18 under this section may make a lump-sum deposit to the account of
18-19 the other subdivision in the retirement system, in an amount
18-20 computed by the retirement system's actuary, on terms that are
18-21 agreed to in writing by the affected subdivisions and approved by
18-22 the board of trustees. Assumptions under this section shall be by
18-23 written agreement between the affected subdivisions and are subject
18-24 to approval of the board of trustees. An agreement under this
18-25 section may be amended in writing by the affected subdivisions if
18-26 the amendment is approved by the board of trustees.
19-1 SECTION 17. Subsection (d), Section 843.403, Government
19-2 Code, is amended to read as follows:
19-3 (d) Interest is earned [for each whole calendar year] on a
19-4 current service credit or multiple matching credit from the end of
19-5 each calendar year to the effective date of the member's retirement
19-6 at the rate credited annually to a member's individual account in
19-7 the employees saving fund.
19-8 SECTION 18. Section 843.501, Government Code, is amended to
19-9 read as follows:
19-10 Sec. 843.501. LEGISLATIVE SERVICE. (a) A member may
19-11 establish credit for current service in the retirement system for
19-12 service performed as a member of the legislature[, if the member
19-13 deposits with the system a contribution in an amount computed for
19-14 each month of service claimed at the contribution rate currently
19-15 required of an employee of the subdivision that employs the member,
19-16 multiplied by $400. On the member's making a deposit, the
19-17 employing subdivision shall deposit with the retirement system a
19-18 contribution in an amount equal to the amount deposited by the
19-19 member].
19-20 [(b)] A member claiming credit for previous legislative
19-21 service shall file a detailed statement of the service with the
19-22 treasurer or other disbursing officer of the subdivision by which
19-23 the member is currently employed. As soon as practicable after the
19-24 filing of a statement, the employing subdivision shall verify the
19-25 service claimed and certify to the board of trustees the amount of
19-26 service approved.
20-1 (b) Credit may not be established under this section for
20-2 service that is credited by another retirement system or program
20-3 established or governed by state law.
20-4 SECTION 19. Section 843.601, Government Code, is amended to
20-5 read as follows:
20-6 Sec. 843.601. CURRENT SERVICE FOR QUALIFIED MILITARY SERVICE
20-7 [MILITARY DUTY]. (a) In this section, "qualified military
20-8 service" means service in the uniformed services, as that term is
20-9 defined in the Uniformed Services Employment and Reemployment
20-10 Rights Act of 1994 (38 U.S.C. Section 4301 et seq.), that meets the
20-11 requirements of that Act as it now exists or is amended as to the
20-12 character of service performed.
20-13 (b) All members of the retirement system are entitled to
20-14 receive credit for qualified military service that is subject to
20-15 the Uniformed Services Employment and Reemployment Rights Act of
20-16 1994 (38 U.S.C. Section 4301 et seq.). Notwithstanding any
20-17 provision of this subtitle to the contrary, contributions,
20-18 benefits, and service credit for qualified military service will be
20-19 provided in accordance with Section 414(u) of the Internal Revenue
20-20 Code of 1986. The board of trustees may adopt rules that modify
20-21 the terms of this subtitle for the purpose of compliance with the
20-22 provisions of that Act.
20-23 (c) The governing body of a participating subdivision also
20-24 may, on the terms provided by Section 844.704, authorize the
20-25 establishment of credit for current service in the retirement
20-26 system for qualified military service as provided by this
21-1 subsection. Qualified military service includes military service
21-2 before becoming an employee of the subdivision. A member eligible
21-3 to establish credit under this subsection is one who has performed
21-4 as an employee at least 10 years of service that is credited in the
21-5 retirement system and who does not receive and is not eligible to
21-6 receive federal retirement payments based on 20 years or more of
21-7 active federal military duty or its equivalent. An eligible member
21-8 may establish credit under this subsection by filing with the
21-9 retirement system an application for the credit.
21-10 (d) A subdivision whose governing body authorized "current
21-11 service for military duty" before December 31, 1999, has authorized
21-12 credit for current service under Subsection (c).
21-13 (e) Except for service credit established with the
21-14 retirement system before December 31, 1999, the maximum amount of
21-15 credited service that a person may receive under this section is
21-16 five years. If a person would receive more than five years of
21-17 service credit as a result of having received credit under
21-18 Subsection (c) before receiving credit under Subsection (b),
21-19 service credit under Subsection (c) shall be canceled to the extent
21-20 necessary to reduce the total to five years of credit [The
21-21 governing body of a participating subdivision may, on the terms
21-22 provided by Section 844.201, authorize the establishment of credit
21-23 for current service in the retirement system for military service
21-24 creditable as provided by this section.]
21-25 [(b) Military service creditable in the retirement system
21-26 under this section is service as a member of the armed forces of
22-1 the United States during a time, or before the first anniversary of
22-2 the last day of a time, that the United States is or was engaged
22-3 in:]
22-4 [(1) organized conflict with foreign forces, whether a
22-5 state of war or a police action; or]
22-6 [(2) a crisis in this country.]
22-7 [(c) The board of trustees by rule shall determine the
22-8 periods recognized for purposes of this subtitle as times of
22-9 organized conflict or crisis.]
22-10 [(d) A member eligible to establish credit under this
22-11 section is one who:]
22-12 [(1) does not receive and is not eligible to receive
22-13 federal retirement payments based on 20 years or more of active
22-14 federal military duty or its equivalent;]
22-15 [(2) has been released from military duty under
22-16 conditions not dishonorable;]
22-17 [(3) became a member of the retirement system after
22-18 release from military duty; and]
22-19 [(4) has performed as an employee at least 10 years of
22-20 service that is credited in the retirement system.]
22-21 [(e) An eligible member may establish credit under this
22-22 section by filing with the retirement system an application for the
22-23 credit. An application must be accompanied by a contribution in an
22-24 amount computed as the number of months of service claimed under
22-25 this section, times the lesser of:]
22-26 [(1) the member's average monthly contribution for the
23-1 first 12 months as an employee after becoming a member of the
23-2 retirement system; or]
23-3 [(2) $15.]
23-4 [(f) If a member makes a deposit under Subsection (e), the
23-5 subdivision shall deposit with the retirement system a contribution
23-6 in an amount equal to the amount deposited under Subsection (e).]
23-7 [(g) The maximum amount of current credited service that may
23-8 be established under this section is:]
23-9 [(1) 3 years, if the member has performed as an
23-10 employee at least 10 but less than 15 years of service that is
23-11 credited in the retirement system; or]
23-12 [(2) 5 years, if the member has performed as an
23-13 employee at least 15 years of service that is credited in the
23-14 system].
23-15 (f) [(h)] Credit may not be established under this section
23-16 for service that is [simultaneously] credited by another retirement
23-17 system or program established or governed by state law.
23-18 (g) The governing body of a subdivision that has authorized
23-19 the establishment of credited service for military service as
23-20 provided by this section and also has adopted the plan provisions
23-21 of Section 844.210 may authorize a reduction in the minimum
23-22 credited service requirement for eligibility to establish credit
23-23 under this section from 10 to 8 years.
23-24 SECTION 20. Section 843.701, Government Code, is amended to
23-25 read as follows:
23-26 Sec. 843.701. INCREASE IN PRIOR SERVICE CREDITS. The
24-1 governing body of a participating subdivision may not[, on the
24-2 terms provided by Section 844.201,] increase the percentage of
24-3 maximum prior service credits used in determining the allocated
24-4 prior service credits under Section 843.105 except on the terms
24-5 provided by Subchapter H, Chapter 844 [previously granted and in
24-6 effect concerning prior service with the subdivision].
24-7 SECTION 21. Section 843.703, Government Code, is amended to
24-8 read as follows:
24-9 Sec. 843.703. INCREASE IN MULTIPLE MATCHING CREDITS.
24-10 [(a)] The governing body of a participating subdivision may not[,
24-11 on the terms provided by Section 844.201,] increase the percentage
24-12 used in determining multiple matching credits under Section 843.403
24-13 except on the terms provided by Subchapter H, Chapter 844
24-14 [843.403(c)].
24-15 [(b) A percentage increase in multiple matching credits must
24-16 be in a multiple of 10 percent of the amount of member
24-17 contributions and must be applied to all members and annuitants who
24-18 have performed or subsequently perform current service that is
24-19 credited with the subdivision in the retirement system.]
24-20 SECTION 22. Subsection (c), Section 844.002, Government
24-21 Code, is amended to read as follows:
24-22 (c) A supplemental annuity is an amount payable from the
24-23 subdivision accumulation fund, subject to reduction under Section
24-24 842.008(d), 842.009(d), 842.010(c), [842.004(c)] or 845.307(c), and
24-25 is actuarially determined from the sum of:
24-26 (1) a member's allocated prior service credit,
25-1 accumulated at interest as provided by Section 843.105(d); and
25-2 (2) a member's multiple matching credit, accumulated
25-3 at interest as provided by Section 843.403(d).
25-4 SECTION 23. Section 844.003, Government Code, is amended by
25-5 amending Subsections (b) and (c) and adding Subsection (e) to read
25-6 as follows:
25-7 (b) If a member who is eligible under Section 844.407
25-8 [844.105, 844.106, 844.203, 844.204, 844.207(e), or 844.210(e)] to
25-9 select an optional retirement annuity dies before retirement, the
25-10 member is considered to have retired on the last day of the month
25-11 before the month in which death occurred [or on the day before the
25-12 first anniversary of the effective date of the person's membership,
25-13 whichever is later].
25-14 (c) Except as provided by Subsection (b), the effective date
25-15 of a member's disability retirement is the date designated on the
25-16 application for retirement filed by or for the member as provided
25-17 by Section 844.301, but the date must be the last day of a calendar
25-18 month and may not precede the date the member terminates employment
25-19 with all participating subdivisions.
25-20 (e) Notwithstanding Subsections (a), (b), and (c), the
25-21 effective retirement date of a member may not precede the first
25-22 anniversary of the earlier of the effective date of the person's
25-23 membership in the retirement system or the effective date of
25-24 participation of the subdivision from which the member had most
25-25 recently earned credited service.
25-26 SECTION 24. Section 844.006, Government Code, is amended by
26-1 amending Subsection (c) and adding Subsection (f) to read as
26-2 follows:
26-3 (c) A retiree who selected an optional annuity under Section
26-4 844.104(c)(1), (c)(2), (c)(5), or (c)(6) or Section 844.305(c)(1),
26-5 (c)(2), (c)(5), or (c)(6) may revoke the designation of the
26-6 beneficiary to receive the annuity on the death of the retiree, if
26-7 a court of competent jurisdiction in a divorce proceeding involving
26-8 the retiree and beneficiary awards to the retiree the entire
26-9 retirement benefit earned by the retiree. The order awarding the
26-10 retirement benefit may be set forth in the divorce decree or in an
26-11 order approving the terms of a property settlement agreement
26-12 incident to the divorce of the retiree and beneficiary but must be
26-13 dated on or after December 31, 1999. The revocation takes effect
26-14 when the retirement system receives it and cancels the optional
26-15 annuity selection made by the retiree. Beginning with the month
26-16 following the month in which the retirement system receives the
26-17 notice of revocation, the retiree is entitled to receive a standard
26-18 service or disability retirement annuity, as applicable, in the
26-19 same amount that the retiree would receive for the same month if
26-20 the retiree had originally retired with a standard service or
26-21 disability retirement annuity [Any selection and designation of
26-22 beneficiary under Subsection (a) or (b) must be in writing on forms
26-23 prescribed by the board of trustees and becomes effective on filing
26-24 with the director].
26-25 (f) The retirement system by rule may establish requirements
26-26 for forms, documentation, and procedures necessary or desirable for
27-1 the administration of this section.
27-2 SECTION 25. Subsections (a) and (b), Section 844.007,
27-3 Government Code, are amended to read as follows:
27-4 (a) The [Except as provided by Subsection (g), the]
27-5 adjustments prescribed in this section shall be made in computing
27-6 the benefits of and to the accounts of any member who retires
27-7 effective at the end of any month other than December.
27-8 (b) Interest [Through December 31, 1995, current and
27-9 supplemental interest will be credited on the balance in the
27-10 member's individual account in the employees saving fund on January
27-11 1 of the year of retirement from that date to the effective date of
27-12 retirement at the rates allowed on individual accounts of members
27-13 as of December 31 of the preceding year. For periods that begin
27-14 after December 31, 1995, interest] will be credited on the balance
27-15 in the member's individual account in the employees saving fund on
27-16 January 1 of the year of retirement from that date to the effective
27-17 date of retirement.
27-18 SECTION 26. Section 844.101, Government Code, is amended to
27-19 read as follows:
27-20 Sec. 844.101. APPLICATION FOR SERVICE RETIREMENT ANNUITY. A
27-21 member may apply for a service retirement annuity by filing an
27-22 application for retirement with the board of trustees on or [not
27-23 less than 15 days] before the member's effective retirement date
27-24 designated on the application.
27-25 SECTION 27. Section 844.102, Government Code, is amended to
27-26 read as follows:
28-1 Sec. 844.102. ELIGIBILITY FOR SERVICE RETIREMENT ANNUITY.
28-2 [(a)] A member is eligible[, beginning on the first anniversary of
28-3 the effective date of the person's membership,] to apply for
28-4 [retire] and receive a service retirement annuity, if the member:
28-5 (1) is at least 60 years old and has at least 12 years
28-6 of credited service in the retirement system; [or]
28-7 (2) has at least 30 years of credited service in the
28-8 retirement system; or
28-9 (3) has met the eligibility requirements for service
28-10 retirement under Section 844.207, 844.210, or 844.211.
28-11 [(b) A member may terminate employment with all
28-12 participating subdivisions and, beginning on the first anniversary
28-13 of the effective date of the person's membership, remain eligible
28-14 to retire and receive a service retirement annuity at any time
28-15 after the member attains the age of 60, if the member has at least
28-16 20 years of credited service in the retirement system.]
28-17 [(c) A member whose most recent service was performed for a
28-18 subdivision having an effective date of participation in the
28-19 retirement system after August 31, 1979, may terminate employment
28-20 with all participating subdivisions and remain eligible to retire
28-21 and receive a service retirement annuity at any time after the
28-22 member attains the age of 60, if the member has at least 12 years
28-23 of credited service performed for one or more subdivisions that are
28-24 either subject to this subsection or have adopted a like provision
28-25 under Section 844.202.]
28-26 SECTION 28. Subsection (j), Section 844.104, Government
29-1 Code, is amended to read as follows:
29-2 (j) A retiree who dies before the 31st day after the
29-3 effective date of service retirement and who did not select an
29-4 optional service retirement annuity before death is considered to
29-5 have selected an optional annuity under Subsection (c)(7) [(c)(4)].
29-6 Alternatively, the decedent's beneficiary may elect to receive a
29-7 refund of the decedent's accumulated contributions under Section
29-8 844.401, in which case the decedent will be considered to have been
29-9 a contributing member at the time of death.
29-10 SECTION 29. Section 844.202, Government Code, is amended to
29-11 read as follows:
29-12 Sec. 844.202. VESTED ELIGIBILITY TO FUTURE RETIREMENT
29-13 [OPTIONAL SERVICE RETIREMENT ELIGIBILITY]. A [(a) The governing
29-14 body of a participating subdivision may authorize an employee of
29-15 the subdivision who is a] member of the retirement system is a
29-16 vested member and may [to] terminate employment with all
29-17 participating subdivisions [the subdivision] and remain eligible to
29-18 retire and receive a service retirement annuity at any time after
29-19 the member attains the age of 60, if the member leaves the member's
29-20 accumulated contributions on deposit with the retirement system
29-21 and:
29-22 (1) has at least 12 years of credited service;
29-23 (2) has at least 10 years of Section 844.207 credited
29-24 service; or
29-25 (3) has at least 8 years of Section 844.210 credited
29-26 service [performed for one or more subdivisions that either have
30-1 authorized the eligibility under this section or are subject to
30-2 Section 844.102(c)].
30-3 [(b) The governing body of a subdivision may not authorize
30-4 eligibility for service retirement under this section except on the
30-5 terms provided by Section 844.201.]
30-6 SECTION 30. Section 844.207, Government Code, is amended to
30-7 read as follows:
30-8 Sec. 844.207. OPTIONAL BENEFIT ELIGIBILITY PLAN. (a) The
30-9 provisions of this section shall apply to all subdivisions that
30-10 [which] elect after September 1, 1985, to begin participation in
30-11 the retirement system. Subject to the conditions in this section
30-12 [below], the governing body of any subdivision participating as of
30-13 September 1, 1985, may adopt the plan provisions of this section.
30-14 (b) The term "Section 844.207 credited service" as used in
30-15 this section means credited service performed for one or more
30-16 participating subdivisions that have adopted the plan provisions of
30-17 this section or the plan provisions of Section 844.210.
30-18 (c) A member is [shall be] eligible[, beginning on the first
30-19 anniversary date of the person's membership,] to apply for [retire]
30-20 and receive a service retirement annuity, if the member:
30-21 (1) is at least 60 years old and has at least 10 years
30-22 of Section 844.207 credited service in the retirement system; or
30-23 (2) is less than 60 years old and has sufficient years
30-24 of Section 844.207 credited service in the retirement system that,
30-25 when that [such] number is added to the years of attained age of
30-26 the member, produces a sum equal to or in excess of the number 80;
31-1 or
31-2 (3) if the member is eligible for service retirement
31-3 under any other provision of this subtitle.
31-4 (d) A member who has 10 years or more of Section 844.207
31-5 credited service is a vested member for purposes of Sections
31-6 844.202, 844.302, and 844.303 [If a member has 10 years or more of
31-7 Section 844.207 credited service in the retirement system,
31-8 subsequent absence from service shall not terminate membership, and
31-9 unless membership is otherwise terminated, the member shall be
31-10 eligible to retire and receive a service retirement annuity at any
31-11 time after the member attains the age of 60 years].
31-12 (e) A member who on December 31, 1999, has any Section
31-13 844.207 credited service, whose membership in the retirement system
31-14 continues after that date without interruption, and who accumulates
31-15 four years or more of Section 844.207 credited service is eligible
31-16 to receive a service retirement benefit when the number of years of
31-17 Section 844.207 credited service added to the years of the member's
31-18 attained age equals or exceeds the number 80 [An employee of a
31-19 participating subdivision which has adopted the plan provisions of
31-20 this section may select an optional service retirement annuity in
31-21 the manner and under the conditions provided in Section 844.105, if
31-22 the member:]
31-23 [(1) has 10 or more years of Section 844.207 credited
31-24 service in the retirement system and has attained the age of 60
31-25 years; or]
31-26 [(2) has at least 20 years of Section 844.207 credited
32-1 service or is otherwise eligible to make such selection of an
32-2 optional service retirement annuity under the provisions of Section
32-3 844.105, 844.106, 844.203, or 844.204.]
32-4 [If a member who is authorized under this subsection to
32-5 select an optional service retirement annuity dies before
32-6 retirement without having made a selection, the member's surviving
32-7 spouse or the executor or administrator of the member's estate may
32-8 make the selection provided by Section 844.105 under the terms of
32-9 that subsection.]
32-10 [(f) A member who has 10 years or more of Section 844.207
32-11 credited service in the retirement system is eligible to retire and
32-12 receive a disability retirement annuity if the member is the
32-13 subject of a certification issued as provided in Section
32-14 844.303(b)(2); but a member is not entitled to retire for
32-15 disability before the first anniversary of the effective date of
32-16 the person's membership. A member eligible to receive a disability
32-17 retirement annuity under this subsection may, if the member is
32-18 eligible for service retirement, elect to receive a service
32-19 retirement annuity but may not receive both annuities.]
32-20 [(g) For the purposes of Subsections (c), (d), (e), and (f),
32-21 each month of credited service under Section 844.210 is considered
32-22 a month of Section 844.207 credited service].
32-23 (f) [(h)] After 1991, the governing body of a subdivision
32-24 may not adopt the plan provisions of this section except on the
32-25 terms provided by Subchapter H [of this chapter].
32-26 SECTION 31. Section 844.209, Government Code, is amended to
33-1 read as follows:
33-2 Sec. 844.209. ALTERNATIVE OPTIONAL INCREASE IN RETIREMENT
33-3 ANNUITIES [OPTIONAL BENEFIT FOR SURVIVING BENEFICIARY OF VESTED
33-4 MEMBER]. (a) The governing body of a participating subdivision,
33-5 from time to time but not more frequently than once in each
33-6 12-month period, may provide for increased annuities to be paid to
33-7 retirees and beneficiaries of deceased retirees of the subdivision.
33-8 The governing body of the subdivision may not elect an increase in
33-9 retirement annuities under Section 844.208 and under this section
33-10 in the same 12-month period.
33-11 (b) An increase under this section applies to all annuities
33-12 for which the effective retirement date is at least twelve months
33-13 before the effective date of the increase.
33-14 (c) The amount of annuity increase under this section is
33-15 computed as the sum of the person's basic and supplemental
33-16 annuities on the effective date of the increase multiplied by the
33-17 integer percentage increase specified by the governing body for all
33-18 annuitants in the order or resolution adopting the increase.
33-19 (d) Except as provided by Subsection (g), the effective date
33-20 of an order or resolution under this section is January 1 of the
33-21 year that begins after the year in which the governing body adopts
33-22 and notifies the retirement system of the order or resolution.
33-23 (e) An increase in an annuity that was reduced because of an
33-24 option selection is reducible in the same proportion and in the
33-25 same manner that the original annuity was reduced.
33-26 (f) The amount of an increase under this section is payable
34-1 as a supplemental annuity, is an obligation of the subdivision's
34-2 account in the subdivision accumulation fund, and is subject to
34-3 reduction under Section 845.307(c).
34-4 (g) The governing body of a subdivision may not adopt an
34-5 order or resolution under this section except on the terms provided
34-6 by Subchapter H. [This section applies to all subdivisions that
34-7 elect after December 31, 1991, to begin participation in the
34-8 retirement system. Subject to the conditions provided by this
34-9 section, the governing body of any subdivision participating before
34-10 January 1, 1992, may adopt the plan provisions of this section.]
34-11 [(b) If a member who has sufficient credited service
34-12 performed for subdivisions that have adopted or are subject to this
34-13 section to entitle the member to withdraw from service, to leave on
34-14 deposit with the retirement system the member's accumulated
34-15 contributions, and, on attainment of an age prescribed by this
34-16 subtitle, to retire with a service retirement benefit dies before
34-17 becoming eligible for deferred service retirement and leaves
34-18 surviving a person whom the member has designated as beneficiary
34-19 entitled to payment of the member's accumulated contributions if
34-20 the member dies before retirement, the surviving beneficiary may by
34-21 written notice filed with the board elect to receive, in lieu of
34-22 the accumulated deposits, an annuity payable during the lifetime of
34-23 the surviving beneficiary in the amount that would have been
34-24 payable to the surviving beneficiary had the member retired on the
34-25 last day of the month preceding the month in which death occurred
34-26 under an optional annuity described by Section 844.104(c)(1).]
35-1 [(c) At any time before the first annuity payment, a
35-2 surviving beneficiary to whom this section applies may, after
35-3 filing a written application with the board of trustees, receive
35-4 payment of the accumulated contributions credited to the account of
35-5 the member in lieu of any benefits otherwise payable under this
35-6 section. If the surviving beneficiary dies before the first
35-7 payment of an annuity allowed under this section, the accumulated
35-8 contributions credited to the account of the member will be paid to
35-9 the estate of the beneficiary.]
35-10 [(d) The governing body of a subdivision may not adopt the
35-11 plan provisions of this section except on the terms provided by
35-12 Subchapter H of this chapter.]
35-13 [(e) The benefit payable under Subsection (b) is payable as
35-14 if the member had retired on the later of December 31, 1993, or the
35-15 last day of the month preceding the month in which death occurred.
35-16 Any benefit payments under this section must begin within one year
35-17 after the later of December 31, 1993, or the last day of the month
35-18 preceding the month in which death occurred. A benefit payable
35-19 under Subsection (b) because of the death of a person who died
35-20 before January 1, 1994, is computed based on the benefit that would
35-21 have been payable if the death had occurred on January 1, 1994.]
35-22 [(f) If a member to whom Subsection (b) would be applicable
35-23 designates the member's estate or more than one but not more than
35-24 three persons to receive payment of the member's accumulated
35-25 contributions if the member dies before becoming eligible to make a
35-26 selection under Section 844.105, 844.106, 844.207, or 844.210, the
36-1 executor or administrator of the estate or, if there is no executor
36-2 or administrator, the surviving beneficiaries may by written notice
36-3 filed with the board elect to receive, in lieu of the accumulated
36-4 deposits, the optional benefit described by Section 844.104(c)(4).
36-5 If the estate is not the beneficiary, the election may only be made
36-6 if all of the beneficiaries agree in writing on the selection of
36-7 the option. If any surviving beneficiary dies before the first
36-8 payment of an annuity allowed under this section, the annuity will
36-9 be paid to those beneficiaries who are still surviving on the date
36-10 of the first payment.]
36-11 [(g) If a member to whom Subsection (b) otherwise would be
36-12 applicable dies without having a valid beneficiary designation on
36-13 file with the retirement system, the member's estate will be
36-14 considered to be the designated beneficiary if the member died
36-15 before becoming eligible to make a selection under Section 844.105,
36-16 844.106, 844.207, or 844.210. The executor or administrator of the
36-17 estate or, if there is no executor or administrator, the persons
36-18 entitled to receive the member's estate may elect to receive, in
36-19 lieu of the accumulated deposits, the optional benefit described by
36-20 Section 844.104(c)(4). The election may be made only by filing
36-21 written notice with the board of trustees together with either a
36-22 certified copy of the court order or an affidavit meeting the
36-23 requirements of Section 137, Texas Probate Code. An election by
36-24 those persons may be made only if all of the persons entitled to
36-25 the member's accumulated contributions agree in writing on the
36-26 selection of the option.]
37-1 SECTION 32. Section 844.210, Government Code, is amended to
37-2 read as follows:
37-3 Sec. 844.210. OPTIONAL BENEFIT ELIGIBILITY PLAN TWO.
37-4 (a) Subject to Subsection (f) [(h)], the governing body of a
37-5 participating subdivision may adopt the plan provisions of this
37-6 section.
37-7 (b) In this section "Section 844.210 credited service" means
37-8 credited service performed for one or more participating
37-9 subdivisions that have adopted the plan provisions of this section.
37-10 (c) A member is eligible[, beginning on the first
37-11 anniversary of the person's membership,] to apply for [retire] and
37-12 receive a service retirement annuity if the member:
37-13 (1) is at least 60 years old and has at least eight
37-14 years of Section 844.210 credited service in the retirement system;
37-15 (2) is less than 60 years old and has sufficient years
37-16 of Section 844.210 credited service in the retirement system that,
37-17 when added to the years of the member's attained age, produces a
37-18 sum equal to or in excess of the number 80; or
37-19 (3) is eligible for service retirement under any other
37-20 provision of this subtitle.
37-21 (d) A member who [If a member] has eight years or more of
37-22 Section 844.210 credited service in the retirement system is a
37-23 vested member for purposes of Sections 844.202, 844.302, and
37-24 844.303[, subsequent absence from service does not terminate
37-25 membership, and unless membership is otherwise terminated, the
37-26 member is eligible to retire and receive a service retirement
38-1 annuity at any time after the member attains the age of 60 years].
38-2 (e) A member who on December 31, 1999, has any Section
38-3 844.210 credited service, whose membership in the retirement system
38-4 continues after that date without interruption, and who accumulates
38-5 four years or more of Section 844.210 credited service is eligible
38-6 to receive a service retirement benefit when the number of years of
38-7 Section 844.210 credited service added to the years of the member's
38-8 attained age equals or exceeds the number 80. For purposes of this
38-9 subsection, Section 844.210 credited service also includes credited
38-10 service performed for one or more subdivisions that have adopted
38-11 the plan provisions of Section 844.207 [An employee of a
38-12 participating subdivision that has adopted the plan provisions of
38-13 this section may select an optional service retirement annuity in
38-14 the manner and under the conditions provided by Section 844.105 if
38-15 the member:]
38-16 [(1) has at least eight years of Section 844.210
38-17 credited service in the retirement system and has attained the age
38-18 of 60 years; or]
38-19 [(2) has at least 20 years of Section 844.210 credited
38-20 service or is otherwise eligible to make a selection of an optional
38-21 service retirement annuity under Section 844.105, 844.106, 844.203,
38-22 844.204, or 844.207.]
38-23 [(f) If a member who is authorized under Subsection (e) to
38-24 select an optional service retirement annuity dies before
38-25 retirement without having made a selection, the member's surviving
38-26 spouse or the executor or administrator of the member's estate may
39-1 make the selection provided by Section 844.105 under the terms of
39-2 that section.]
39-3 [(g) A member who has at least eight years of Section
39-4 844.210 credited service in the retirement system is eligible to
39-5 retire and receive a disability retirement annuity if the member is
39-6 the subject of a certification issued as provided by Section
39-7 844.303(b)(2), except that a member is not eligible to retire for
39-8 disability before the first anniversary of the effective date of
39-9 the person's membership. A member eligible to receive a disability
39-10 retirement annuity under this subsection may, if the member is
39-11 eligible for service retirement, elect to receive a service
39-12 retirement annuity but may not receive both annuities].
39-13 (f) [(h)] The governing body of a subdivision may not adopt
39-14 the plan provisions of this section except on the terms provided by
39-15 Subchapter H [of this chapter].
39-16 SECTION 33. Section 844.211, Government Code, is amended to
39-17 read as follows:
39-18 Sec. 844.211. OPTIONAL BENEFIT ELIGIBILITY PLAN THREE.
39-19 (a) Subject to Subsection (e) [(d)], the governing body of a
39-20 participating subdivision may adopt the plan provisions of this
39-21 section.
39-22 (b) In this section "Section 844.211 credited service" means
39-23 credited service performed for one or more participating
39-24 subdivisions that have adopted the plan provisions of this section.
39-25 (c) A member is eligible[, beginning on the first
39-26 anniversary of the person's membership,] to apply for [retire] and
40-1 receive a service retirement annuity if the member:
40-2 (1) is less than 60 years old and has sufficient years
40-3 of Section 844.211 credited service in the retirement system that,
40-4 when added to the years of the member's attained age, produces a
40-5 sum equal to or in excess of the number 75; or
40-6 (2) is eligible for service retirement under any other
40-7 provision of this subtitle.
40-8 (d) A member who on December 31, 1999, has any Section
40-9 844.211 credited service, whose membership in the retirement system
40-10 continues after that date without interruption, and who accumulates
40-11 four years or more of Section 844.211 credited service is eligible
40-12 to receive a service retirement benefit when the number of years of
40-13 that credited service added to the years of the member's attained
40-14 age equals or exceeds the number 75.
40-15 (e) The governing body of a subdivision may not adopt the
40-16 plan provisions of this section except on the terms provided by
40-17 Subchapter H [of this chapter].
40-18 SECTION 34. Subsection (b), Section 844.301, Government
40-19 Code, is amended to read as follows:
40-20 (b) An application for a disability retirement annuity must
40-21 be filed on or [not less than 15 days] before the member's
40-22 effective retirement date designated on the application.
40-23 SECTION 35. Section 844.302, Government Code, is amended to
40-24 read as follows:
40-25 Sec. 844.302. ELIGIBILITY FOR DISABILITY RETIREMENT ANNUITY.
40-26 (a) Except as provided by Subsection (c), a member who is not a
41-1 vested member under Section 844.202 [has less than 12 years of
41-2 credited service in the retirement system] is eligible to apply for
41-3 [retire] and receive a disability retirement annuity if the member
41-4 is the subject of a certification issued as provided by Section
41-5 844.303(b)(1).
41-6 (b) Except as provided by Subsection (c), a member who is a
41-7 vested member under Section 844.202 [has at least 12 years of
41-8 credited service in the retirement system] is eligible to apply for
41-9 [retire] and receive a disability retirement annuity if the member
41-10 is the subject of a certification issued as provided by Section
41-11 844.303(b)(2). A member eligible to receive a disability
41-12 retirement annuity under this subsection may, if the member is
41-13 eligible for service retirement, elect to receive a service
41-14 retirement annuity but may not receive both annuities.
41-15 (c) A member is not eligible to retire for disability before
41-16 the first anniversary of the earlier of the effective date of the
41-17 person's membership or the effective date of participation of the
41-18 subdivision from which the member had most recently earned credited
41-19 service.
41-20 SECTION 36. Subsection (b), Section 844.303, Government
41-21 Code, is amended to read as follows:
41-22 (b) The medical board shall issue a certification of
41-23 disability and submit it to the board of trustees, if the medical
41-24 board finds:
41-25 (1) in the case of a member who is not a vested member
41-26 under Section 844.202 [has less than 12 years of credited service
42-1 in the retirement system], that:
42-2 (A) the member is mentally or physically
42-3 incapacitated for any gainful occupation;
42-4 (B) the incapacity is the direct result of
42-5 injuries sustained during membership by external and violent means
42-6 as a direct and proximate result of the performance of duty;
42-7 (C) the incapacity is likely to be permanent;
42-8 and
42-9 (D) the member should be retired; or
42-10 (2) in the case of a member who is a vested member
42-11 under Section 844.202 [has at least 12 years of credited service in
42-12 the retirement system], that:
42-13 (A) the member is mentally or physically
42-14 incapacitated for any gainful occupation;
42-15 (B) the incapacity is likely to be permanent;
42-16 and
42-17 (C) the member should be retired.
42-18 SECTION 37. Subsection (h), Section 844.305, Government
42-19 Code, is amended to read as follows:
42-20 (h) A retiree who dies before the 31st day after the
42-21 effective date of disability retirement and who did not select an
42-22 optional disability retirement annuity before death is considered
42-23 to have selected an optional annuity under Subsection (c)(7)
42-24 [(c)(4)]. Alternatively, the decedent's beneficiary may elect to
42-25 receive a refund of the decedent's accumulated contributions under
42-26 Section 844.401, in which case the decedent will be considered to
43-1 have been a contributing member at the time of death.
43-2 SECTION 38. Subchapter E, Chapter 844, Government Code, is
43-3 amended by adding Section 844.407 to read as follows:
43-4 Sec. 844.407. SURVIVOR ANNUITY DEATH BENEFIT. (a) In this
43-5 section "eligible member" means:
43-6 (1) a member who has four or more years of credited
43-7 service with one or more subdivisions that on September 1, 1999,
43-8 are participating in the retirement system or that begin
43-9 participation in the system after that date;
43-10 (2) a member who has 20 or more years of credited
43-11 service with one or more subdivisions participating in the system;
43-12 (3) a member who is at least 60 years of age and has
43-13 12 or more years of credited service with one or more subdivisions
43-14 participating in the system;
43-15 (4) a member who is at least 60 years of age and has
43-16 10 or more years of Section 844.207 credited service; or
43-17 (5) a member who is at least 60 years of age and has
43-18 eight or more years of Section 844.210 credited service.
43-19 (b) An annuity described by this section may be selected and
43-20 paid on the death of an eligible member before the effective date
43-21 of the member's retirement instead of any other benefit allowed
43-22 under this subtitle, except that a supplemental death benefit under
43-23 Subchapter F may also be paid.
43-24 (c) An eligible member may, before the effective date of the
43-25 member's retirement, file with the board of trustees on a form
43-26 prescribed by the board a selection of an optional service
44-1 retirement annuity available under Section 844.104 and a
44-2 designation of beneficiary.
44-3 (d) A member who is entitled under this section to select
44-4 one of the optional service retirement annuities authorized by
44-5 Section 844.104 may elect instead to name a beneficiary who, on the
44-6 death of the member before retirement, will be allowed to choose
44-7 any benefit that the member could have chosen to be paid to the
44-8 beneficiary, with like effect as if the selection had been made by
44-9 the member.
44-10 (e) An unrevoked application for deferred service retirement
44-11 executed and filed by the member with the retirement system before
44-12 December 31, 1999, shall be considered a selection of benefit and a
44-13 designation of beneficiary under Subsection (c). If no application
44-14 is on file on that date, an unrevoked form executed by the member
44-15 and filed with the system naming a beneficiary to whom the member's
44-16 accumulated deposits are to be paid in the event of death before
44-17 retirement shall be considered a selection of a beneficiary under
44-18 Subsection (d).
44-19 (f) A member may change a selection of an optional annuity
44-20 or a designation of beneficiary at any time before the member's
44-21 retirement or death in the same manner that the original selection
44-22 or designation was made.
44-23 (g) If an eligible member dies before retirement without
44-24 having made a selection under Subsection (c), (d), or (e), the
44-25 member's surviving spouse is considered to be the beneficiary and
44-26 may select an optional annuity in the same manner as if the member
45-1 had made the selection.
45-2 (h) If no surviving spouse exists, the executor or
45-3 administrator of the member's estate may elect:
45-4 (1) for an estate beneficiary to receive the optional
45-5 annuity under Section 844.104(c)(7); or
45-6 (2) for the estate to receive a refund of the member's
45-7 accumulated contributions under Section 844.401.
45-8 (i) Any annuity payable under this section shall be computed
45-9 on the assumption that the member had actually retired under the
45-10 annuity selected and with the same beneficiary determined under the
45-11 applicable provision of this section, effective on the last day of
45-12 the calendar month before the month in which death of the member
45-13 occurred.
45-14 (j) A survivor annuity under this section shall be paid from
45-15 the same accounts and is subject to the same conditions as are
45-16 applicable to a service retirement benefit for the same member.
45-17 SECTION 39. Subchapter E, Chapter 844, Government Code, is
45-18 amended by adding Section 844.408 to read as follows:
45-19 Sec. 844.408. NO SURVIVING SPOUSE, EXECUTOR, OR
45-20 ADMINISTRATOR. (a) In this section "heirs" has the meaning
45-21 assigned by Section 3, Texas Probate Code, except that the term
45-22 excludes any person who has filed a proper disclaimer or
45-23 renunciation with the retirement system.
45-24 (b) If a surviving spouse or the executor or administrator
45-25 of a deceased member's estate would be entitled to make an election
45-26 under Section 842.110(f) or 842.111(c), or if a beneficiary or the
46-1 executor or administrator of a deceased member's estate would be
46-2 entitled to make an election under Section 844.407 because of the
46-3 death of the member, the heirs of the deceased member may make that
46-4 election if:
46-5 (1) no surviving spouse exists, or, if Section 844.407
46-6 is applicable, no surviving beneficiary exists;
46-7 (2) no petition for the appointment of a personal
46-8 representative of the member is pending or has been granted;
46-9 (3) 30 days have elapsed since the date of death of
46-10 the member;
46-11 (4) the value of the entire assets of the member's
46-12 estate, excluding homestead and exempt property, does not exceed
46-13 $50,000; and
46-14 (5) on file with the retirement system is a certified
46-15 copy of a small estates affidavit that has been approved and filed
46-16 in accordance with Section 137, Texas Probate Code, or an original
46-17 affidavit described by Subsection (c).
46-18 (c) If no affidavit has been filed with the clerk of the
46-19 court having jurisdiction and venue as provided by Section 137,
46-20 Texas Probate Code, the retirement system may accept instead an
46-21 affidavit sworn to by two disinterested witnesses and by those
46-22 heirs who have legal capacity and, if the facts warrant, by the
46-23 natural guardian or next of kin of any minor or incompetent who is
46-24 also an heir. The affidavit must include the names and addresses
46-25 of the heirs and witnesses, establish the facts listed in
46-26 Subsection (b), include a list of the assets and liabilities of the
47-1 estate, show the facts that constitute the basis for the right of
47-2 the heirs to receive the estate, and show the fractional interests
47-3 of the heirs in the estate as a result of those facts.
47-4 (d) If the retirement system, acting through the director or
47-5 a person designated by the director, approves the affidavit, the
47-6 heirs may make the election if each heir agrees to it.
47-7 SECTION 40. Subsections (a), (b), (c), and (d), Section
47-8 844.502, Government Code, are amended to read as follows:
47-9 (a) A member included in the coverage of the supplemental
47-10 death benefit program who fails to earn compensation in a month for
47-11 service to a subdivision participating in the supplemental death
47-12 benefits fund may be [is] eligible to receive extended coverage in
47-13 the program under [on complying with the terms of] this section.
47-14 (b) A member who dies within 24 months after the date the
47-15 member last made a required contribution to the retirement system
47-16 is considered to have received [is entitled to receive] extended
47-17 program coverage if the retirement system receives at its office
47-18 after the member's death:
47-19 (1) evidence that the retirement system considers
47-20 satisfactory to establish [notification] that, as a result of
47-21 illness or injury, the member was [is] unable to engage in gainful
47-22 employment throughout the period beginning with the date of the
47-23 last required contribution and ending on the date of death; [or is
47-24 on leave of absence under the Family and Medical Leave Act of 1993
47-25 (Pub. L. 103-3); and]
47-26 (2) a statement from the subdivision, on a form
48-1 approved by the board of trustees, that the member was on leave of
48-2 absence under the Family and Medical Leave Act of 1993 (Pub. L.
48-3 103-3) throughout the period beginning with the date of the last
48-4 required contribution and ending on the date of death; or
48-5 (3) a statement from the subdivision, on a form
48-6 approved by the board of trustees, that the member was on leave of
48-7 absence under the Family and Medical Leave Act of 1993 (Pub. L.
48-8 103-3) during part of the period beginning with the date of the
48-9 last required contribution and ending on the date of death, with
48-10 evidence that the retirement system considers satisfactory to
48-11 establish that, throughout the rest of the period, the member was
48-12 unable to engage in gainful employment as a result of illness or
48-13 injury [evidence that the member made a required contribution to
48-14 the retirement system as an employee of a subdivision participating
48-15 in the supplemental death benefits fund for the month immediately
48-16 preceding the first full month in which the member was unable to
48-17 engage in gainful employment].
48-18 (c) A member who had applied for and received extended
48-19 program coverage before September 1, 1999, remains covered by [The
48-20 retirement system may request additional evidence as to illness or
48-21 injury or of the required contribution as a condition to granting
48-22 the coverage.]
48-23 [(d) Once established, extended coverage of a person in] the
48-24 supplemental death benefit program [continues] until the last day
48-25 of the month in which:
48-26 (1) the member returns to work as an employee of a
49-1 participating subdivision;
49-2 (2) the member becomes able to engage in gainful
49-3 employment;
49-4 (3) the person's membership in the retirement system
49-5 is terminated;
49-6 (4) the member retires under this subtitle; or
49-7 (5) the member's leave of absence under the Family and
49-8 Medical Leave Act of 1993 (Pub. L. 103-3) terminates.
49-9 SECTION 41. Section 844.505, Government Code, is amended to
49-10 read as follows:
49-11 Sec. 844.505. BENEFICIARY OF SUPPLEMENTAL DEATH BENEFIT.
49-12 (a) Unless a member has directed otherwise on a form prescribed by
49-13 the board of trustees and filed with the retirement system:
49-14 (1) a supplemental death benefit under Section 844.503
49-15 is payable to the person entitled to receive the decedent's
49-16 accumulated contributions, unless the decedent was eligible under
49-17 Section 844.407 [844.105] to select an optional service retirement
49-18 annuity, in which case the benefit is payable to the beneficiary
49-19 designated by the decedent or, if no designation was made, to the
49-20 person entitled under that section to receive an optional annuity;
49-21 and
49-22 (2) a supplemental death benefit under Section 844.504
49-23 is payable to a person entitled to receive any remaining payments
49-24 of the decedent's annuity.
49-25 (b) If a person entitled under this section to receive a
49-26 supplemental death benefit does not survive the member or retiree
50-1 covered by the supplemental death benefit program, the benefit is
50-2 payable to the person to whom a benefit under Subchapter B or D is
50-3 payable, or if no benefit is payable under those subchapters, to
50-4 the person to whom a benefit under Subchapter E is or would be
50-5 payable [estate of the covered member or retiree].
50-6 SECTION 42. Subsections (b) and (c), Section 844.605,
50-7 Government Code, are amended to read as follows:
50-8 (b) A supplemental contribution rate is the rate of
50-9 contribution by a subdivision to its account in the subdivision
50-10 accumulation fund, in addition to the contributions provided under
50-11 Section 845.404(a)(2), that the actuary determines and certifies is
50-12 required, together with the contributions provided under Section
50-13 845.404(a)(2), to amortize the obligations of the subdivision to
50-14 the subdivision accumulation fund within a period of 25 years. A
50-15 supplemental contribution rate may [not] exceed the rate determined
50-16 by the actuary [four percent of covered payroll].
50-17 (c) A supplemental contribution rate adopted by a
50-18 participating subdivision may not be increased unless the actuary
50-19 subsequently makes the determination described by Subsection (a).
50-20 If the actuary subsequently makes the determination specified by
50-21 this subsection, the governing body of the subdivision may adopt
50-22 another supplemental contribution rate under this section.
50-23 SECTION 43. Section 844.606, Government Code, is amended by
50-24 adding Subsection (f) to read as follows:
50-25 (f) The lower percentage to be used in determining multiple
50-26 matching credits provided for by Subsection (b) must be a multiple
51-1 of 10 percent of the amount of member contributions.
51-2 SECTION 44. Subsection (a), Section 844.608, Government
51-3 Code, is amended to read as follows:
51-4 (a) Notwithstanding Section 845.402(c) [Sections 845.402(c)
51-5 and (d)], a subdivision's member contribution rate may be reduced
51-6 to one, two, three, four, five, or six percent of the current
51-7 service compensation of its employees, except that the rate of
51-8 member contributions may be reduced to less than four percent only
51-9 if the reduction is necessary under this section.
51-10 SECTION 45. Section 844.702, Government Code, is amended to
51-11 read as follows:
51-12 Sec. 844.702. MEMBER CONTRIBUTIONS. (a) The governing body
51-13 of the subdivision may designate the rate of member contributions
51-14 for employees of the subdivision to take effect beginning on the
51-15 effective date of adoption of the plan provisions of this
51-16 subchapter. The subdivision may elect a rate of four, five, six,
51-17 or seven percent of the current service compensation of its
51-18 employees. The governing body of the subdivision may thereafter
51-19 increase or decrease the contribution rate to take effect on the
51-20 next January 1 after the date of adoption of the increase or
51-21 decrease, in accordance with [notwithstanding] the provisions of
51-22 Sections 845.402(b) and (c) [845.402(c) and (d)].
51-23 (b) If necessary under Section [844.608(b) or] 844.703(h), a
51-24 subdivision's member contribution rate may be reduced to one, two,
51-25 three, four, five, or six percent of the current service
51-26 compensation of its employees.
52-1 SECTION 46. Subsections (c), (d), (g), and (h), Section
52-2 844.703, Government Code, are amended to read as follows:
52-3 (c) The combined rates of a subdivision's normal
52-4 contributions and prior service contributions under this subchapter
52-5 may not exceed 11 percent unless the governing body of the
52-6 subdivision elects to waive this limitation. A waiver under this
52-7 subsection becomes effective on January 1 of the year after the
52-8 year in which it is adopted and remains effective until January 1
52-9 of the year following a repeal of the waiver by the subdivision's
52-10 governing body.
52-11 (d) The actuary annually shall determine the subdivision
52-12 normal contribution rate and the prior service contribution rate
52-13 for subdivisions adopting the plan provisions of this subchapter
52-14 from the most recent data available at the time of determination.
52-15 Before January 1 of each year, the board of trustees shall certify
52-16 the rates of each subdivision that has adopted the plan provisions
52-17 of this subchapter. If the combined rates of the subdivision's
52-18 normal contributions and prior service contributions under this
52-19 subchapter exceed the rate prescribed by Subsection (c), and if the
52-20 governing body of the subdivision has not waived that maximum rate,
52-21 the rate for prior service contributions must be reduced to the
52-22 rate that equals the difference between the maximum rate prescribed
52-23 by Subsection (c) and the normal contribution rate. The governing
52-24 body may elect to contribute at a rate that is an integer percent
52-25 but not more than the maximum rate prescribed by Subsection (c),
52-26 unless the governing body has elected to waive that maximum rate,
53-1 if that elected rate exceeds the sum of the subdivision's normal
53-2 contribution rate and its prior service contribution rate as
53-3 determined under Subsections (a) and (b). This elected rate
53-4 remains in effect for each subsequent calendar year until it is
53-5 rescinded by the governing body or until the sum of the rates
53-6 determined under Subsections (a) and (b) exceeds the elected rate,
53-7 at which time the governing body must contribute the sum of the
53-8 rates determined under Subsections (a) and (b). For years in which
53-9 the elected rate exceeds the sum of the rates determined under
53-10 Subsections (a) and (b), the prior service contribution rate is
53-11 increased to the rate that equals the difference between the
53-12 elected rate and the normal contribution rate prescribed by
53-13 Subsection (a).
53-14 (g) If the combined rates of the subdivision's normal
53-15 contributions and prior service contributions under this subchapter
53-16 exceed the maximum rate prescribed by Subsection (c) before the
53-17 adjustment prescribed by Subsection (d), and if the governing body
53-18 of the subdivision has not waived that maximum rate, the actuary
53-19 shall determine what lower percentage for determining multiple
53-20 matching credits of future member contributions is necessary to
53-21 make the combined rates of the subdivision not exceed the maximum
53-22 rate prescribed by Subsection (c). The actuary shall give written
53-23 notice of the determination to the director, who shall give written
53-24 notice to the governing body of the subdivision. The lower
53-25 percentage determined by the actuary and specified in the notice to
53-26 the governing body becomes effective as to all members who perform
54-1 current service for the affected subdivision on or after the first
54-2 day of the first calendar year that begins after the date of the
54-3 notice, unless before the effective date, the governing body of the
54-4 subdivision adopts an order or resolution, approved by the board of
54-5 trustees, authorizing a reduction in the percentage used in
54-6 determining multiple matching credits in accordance with Section
54-7 844.704(a) or authorizing a reduction in the rate of member
54-8 contributions in accordance with Section 844.702, or authorizing
54-9 both a reduction in the percentage used in determining multiple
54-10 matching credits and a reduction in the rate of member
54-11 contributions.
54-12 (h) If the combined rates of the subdivision's normal
54-13 contributions and prior service contributions under this subchapter
54-14 exceed the maximum rate prescribed by Subsection (c), and if the
54-15 governing body of the subdivision has not waived that maximum rate,
54-16 and if all reductions under Subsection (g), in the opinion of the
54-17 actuary, result in the combined rates of the subdivision remaining
54-18 in excess of the maximum rate prescribed by Subsection (c), the
54-19 retirement system shall reduce the rate of member contributions to
54-20 a lower rate authorized by Section 844.702 that, in the opinion of
54-21 the actuary, is required to produce a combined rate that does not
54-22 exceed the rate prescribed by Subsection (c). At the time the
54-23 actuary determines that the rate of employee contributions that was
54-24 in existence before a reduction under this subsection no longer
54-25 would result in a combined rate in excess of the maximum rate
54-26 prescribed by Subsection (c), the retirement system shall reinstate
55-1 the employee contribution to the rate that was in effect at the
55-2 time of the reduction, unless the governing body of the subdivision
55-3 has elected to change to some other rate authorized by Section
55-4 844.702(a). Any change under this section shall be made on January
55-5 1 of the year following the applicable determination by the
55-6 actuary. During the time that the member contribution rate is
55-7 reduced, the combined rates of the subdivision's normal
55-8 contributions and prior service contributions shall be equal to the
55-9 maximum rate prescribed by Subsection 844.703(c).
55-10 SECTION 47. Subsections (c), (d), and (e), Section 844.704,
55-11 Government Code, are amended to read as follows:
55-12 (c) By adopting the plan provisions of this subchapter, the
55-13 governing body also adopts the optional benefit eligibility plan
55-14 described by Section 844.207 unless by its order it adopts the
55-15 optional benefit eligibility plan described by Section 844.210 and
55-16 the survivor annuity death benefit described by Section 844.407.
55-17 (d) The governing body of a subdivision that has adopted or
55-18 is adopting the plan provisions of this subchapter may adopt:
55-19 (1) the alternative optional increase in retirement
55-20 annuities [benefit for a surviving beneficiary of a vested member]
55-21 under Section 844.209;
55-22 (2) the optional increase in retirement annuities
55-23 under Section 844.208;
55-24 (3) the optional authorization of the reestablishment
55-25 of credited service previously forfeited under Section 843.003;
55-26 (4) the optional authorization of the establishment of
56-1 credited service for military service under Section 843.601(c)
56-2 [843.202 or 843.601, notwithstanding the limitation related to
56-3 Section 844.201 in Section 843.202(d) and 843.601(a)];
56-4 (5) the optional authorization of the establishment of
56-5 premembership credited service for overage employees under Section
56-6 843.204 [election to have credits recomputed on the basis of total
56-7 compensation under Section 843.702];
56-8 (6) the optional benefit eligibility plan described by
56-9 Section 844.210; or
56-10 (7) the optional benefit eligibility plan described by
56-11 Section 844.211.
56-12 (e) The governing body may not adopt the benefits of this
56-13 section if the adoption would result in the combined rates of the
56-14 subdivision's normal contributions and prior service contributions
56-15 for the first calendar year following the adoption exceeding the
56-16 maximum rate prescribed by Section 844.703(c) unless a waiver under
56-17 that section is in effect.
56-18 SECTION 48. Section 845.105, Government Code, is amended to
56-19 read as follows:
56-20 Sec. 845.105. INDEBTEDNESS; PAYMENT. (a) The board of
56-21 trustees may:
56-22 (1) incur indebtedness;
56-23 (2) on the credit of the retirement system, borrow
56-24 money to pay expenses incident to the system's operation;
56-25 (3) renew, extend, or refund its indebtedness; or
56-26 (4) issue and sell negotiable promissory notes or
57-1 negotiable bonds of the system.
57-2 (b) A note or bond issued under this section must [mature
57-3 before the 20th anniversary of the issuance of the note or bond.
57-4 The rate of interest on the note or bond may not exceed six percent
57-5 a year.]
57-6 [(c) The board shall charge a note or bond issued under this
57-7 section against the system's expense fund and shall pay the note or
57-8 bond from that fund. The total indebtedness against the expense
57-9 fund may not exceed $100,000 at any time.]
57-10 [(d) A note or bond issued under this section must]
57-11 expressly state that the note or bond is not an obligation of this
57-12 state.
57-13 SECTION 49. Subchapter B, Chapter 845, Government Code, is
57-14 amended by adding Section 845.116 to read as follows:
57-15 Sec. 845.116. ELECTRONIC TRANSFER OF FUNDS AND ELECTRONIC
57-16 FILING OF DOCUMENTS. (a) In this section:
57-17 (1) "Electronic filing" means the filing of data
57-18 transmitted to the retirement system by the communication of
57-19 information by facsimile or in the form of digital electronic
57-20 signals transformed by computer and stored on microfilm, magnetic
57-21 tape, optical disks, or any other medium.
57-22 (2) "Electronic transfer" means any transfer of funds,
57-23 other than a transaction originated by check, draft, or similar
57-24 paper instrument, that is initiated through an electronic terminal,
57-25 telephone instrument, computer, or magnetic media to order,
57-26 instruct, or authorize a financial institution to debit or credit
58-1 an account.
58-2 (b) The board of trustees may adopt rules and procedures
58-3 relating to the electronic transfer of funds and the electronic
58-4 filing of documents and required reports.
58-5 (c) Funds that are electronically transferred in accordance
58-6 with those rules and procedures are considered to have been timely
58-7 received by the retirement system. Documents and required reports
58-8 that are electronically filed in accordance with those rules and
58-9 procedures are considered to have been properly filed with the
58-10 retirement system.
58-11 SECTION 50. Subsections (a) and (c), Section 845.301,
58-12 Government Code, are amended to read as follows:
58-13 (a) The assets of the retirement system shall be invested
58-14 and reinvested without distinction as to their source in accordance
58-15 with Section 67, Article XVI, Texas Constitution. For purposes of
58-16 the investment authority of the board of trustees under Section 67,
58-17 Article XVI, Texas Constitution, "securities" means any investment
58-18 instrument within the meaning of the term as defined by Section 4,
58-19 The Securities Act (Article 581-4, Vernon's Texas Civil Statutes),
58-20 15 U.S.C. Section 77b(a)(1), or 15 U.S.C. Section 78c(a)(10).
58-21 Investment decisions are subject to the standard provided in the
58-22 Texas Trust Code by Section 113.056(a), Property Code.
58-23 (c) The board of trustees, acting on the recommendations of
58-24 the investment officer, may contract with private professional
58-25 investment managers to assist in investing the assets of the
58-26 retirement system. The board of trustees also has the authority
59-1 set forth in Section 802.204 to appoint investment managers for the
59-2 retirement system, with the effect described by Section 802.203(c).
59-3 SECTION 51. Section 845.306, Government Code, is amended to
59-4 read as follows:
59-5 Sec. 845.306. EMPLOYEES SAVING FUND. (a) The retirement
59-6 system shall deposit in a member's individual account in the
59-7 employees saving fund:
59-8 (1) the amount of contributions to the retirement
59-9 system deducted from the member's compensation;
59-10 (2) interest allowed on money in the account in
59-11 accordance with this subtitle;
59-12 (3) [an amount deposited by a member in accordance
59-13 with Section 845.405 to establish credited service during a time of
59-14 war;]
59-15 [(4)] the portion of a deposit required by Section
59-16 843.003 [or 843.404] to reinstate credited service previously
59-17 terminated that represents the amount withdrawn;
59-18 (4) [(5)] the amount deposited in accordance with
59-19 Section 843.301(b) or 843.402(b) to establish credit for prior or
59-20 current service for a person who became a member in accordance with
59-21 Subchapter C, [of] Chapter 842;
59-22 (5) [(6)] the amount, if any, deposited by a member in
59-23 accordance with Section 843.601(b) [843.601(e)] to establish
59-24 current service credit for military service;
59-25 [(7) the amount deposited by a member in accordance
59-26 with Section 843.501 to establish credit for legislative service;]
60-1 and
60-2 (6) [(8)] the amount deposited by a person to become a
60-3 member in accordance with Section 842.103.
60-4 (b) On December 31 of each year, the retirement system shall
60-5 credit to each member's individual account interest as allowed by
60-6 this subtitle on the amount of accumulated deposits credited to the
60-7 member's account on January 1 of that year.
60-8 [(c) The retirement system may not pay interest on money in
60-9 a person's individual account:]
60-10 [(1) for a part of a year; or]
60-11 [(2) after the person's membership has been terminated
60-12 in accordance with Section 842.109 because of absence from
60-13 service.]
60-14 SECTION 52. Subsection (a), Section 845.307, Government
60-15 Code, is amended to read as follows:
60-16 (a) The retirement system shall deposit in the account of a
60-17 participating subdivision in the subdivision accumulation fund:
60-18 (1) all benefit contributions made by the subdivision
60-19 to the system pursuant to Section 845.404(a)(2);
60-20 (2) income [and interest] allocated to the fund as
60-21 provided by this subtitle;
60-22 (3) amounts deposited by the subdivision under Section
60-23 845.408 [in accordance with former Section 845.405 to establish
60-24 credited service during a time of war];
60-25 (4) the withdrawal charge for reinstatement of
60-26 credited service as provided by Section 843.003 [or 843.404];
61-1 (5) the amount of matching contributions made by a
61-2 subdivision in accordance with Section 843.301(c) or 843.402(c) to
61-3 establish credit for prior or current service for a person who
61-4 became a member in accordance with Subchapter C, [of] Chapter 842;
61-5 [(6) the amount of matching contributions made by a
61-6 subdivision in accordance with Section 843.601(f) to establish
61-7 current service credit for military service;]
61-8 [(7) the amount of matching contributions made by a
61-9 subdivision in accordance with Section 843.501 to establish credit
61-10 for legislative service;] and
61-11 (6) [(8)] the amount deposited by a subdivision for a
61-12 person to become a member in accordance with Section 842.103.
61-13 SECTION 53. Subsection (f), Section 845.310, Government
61-14 Code, is amended to read as follows:
61-15 (f) The retirement system shall deposit and hold in the
61-16 perpetual endowment account funds, gifts, and awards that the
61-17 grantors designate as perpetual endowment for the retirement system
61-18 and money forfeited to the retirement system as provided by Section
61-19 845.505 [845.503].
61-20 SECTION 54. Section 845.312, Government Code, is amended to
61-21 read as follows:
61-22 Sec. 845.312. SUPPLEMENTAL DEATH BENEFITS FUND. (a) The
61-23 retirement system shall deposit in the supplemental death benefits
61-24 fund contributions paid by subdivisions to the retirement system to
61-25 provide supplemental death benefits in accordance with Section
61-26 845.406. The retirement system may not establish separate accounts
62-1 in the fund for subdivisions participating in the fund but shall
62-2 credit contributions to a single account.
62-3 (b) The retirement system shall pay supplemental death
62-4 benefits only from money in the supplemental death benefits fund,
62-5 and the benefits are not an obligation of other funds of the
62-6 system.
62-7 (c) [The supplemental death benefits fund may become
62-8 operative only after a sufficient number of subdivisions elect to
62-9 participate in the fund so that 4,000 members or more are covered
62-10 by the fund.]
62-11 [(d) The board of trustees shall determine the operative
62-12 date of the fund.]
62-13 [(e)] The effective participation date of a subdivision is[:]
62-14 [(1) the operative date of the fund if the subdivision
62-15 elected to participate in the fund on or before the fund's
62-16 operative date; or]
62-17 [(2)] the first day of any calendar month after the
62-18 month in which the subdivision notifies the board of its election
62-19 to enter the fund.
62-20 [(f) The board of trustees shall notify each subdivision of
62-21 its effective participation date.]
62-22 SECTION 55. Subsection (b), Section 845.315, Government
62-23 Code, is amended to read as follows:
62-24 (b) The account of each subdivision, other than a
62-25 subdivision that has ceased participation according to Section
62-26 845.317(a), will receive a share of the amount transferred under
63-1 Subsection (a)(5) that is in proportion to the amount that the
63-2 balance credited to its account on January 1 bears to the total
63-3 credited to the subdivision accumulation fund on that date.
63-4 SECTION 56. The heading of Subchapter E, Chapter 845,
63-5 Government Code, is amended to read as follows:
63-6 SUBCHAPTER E. COLLECTION OF [MEMBERSHIP FEES AND]
63-7 CONTRIBUTIONS
63-8 SECTION 57. Subsection (j), Section 845.403, Government
63-9 Code, is amended to read as follows:
63-10 (j) Contributions picked up as provided by Subsection (i)
63-11 shall be treated as employer contributions in determining tax
63-12 treatment of the amounts under Section 414(h) of the United States
63-13 Internal Revenue Code of 1986[; however, each participating
63-14 subdivision shall continue to withhold federal income taxes based
63-15 upon these contributions until the Internal Revenue Service
63-16 determines or the federal courts rule that pursuant to Section
63-17 414(h) of the Internal Revenue Code of 1986 (26 U.S.C. Section
63-18 414), these picked-up contributions are not included as gross
63-19 income of the employee until such time as they are distributed or
63-20 made available]. Each employee contribution that is picked up as
63-21 above provided shall be deposited as provided in Section 845.306 to
63-22 the individual account of the member, on whose behalf they are
63-23 made, and shall be treated for all other purposes of this subtitle
63-24 in the same manner and with like effect as if the amount had been
63-25 deducted from the compensation of and made by the employee pursuant
63-26 to Sections 845.402 and 845.403(a) through (h).
64-1 SECTION 58. Subsection (a), Section 845.404, Government
64-2 Code, is amended to read as follows:
64-3 (a) Before the 16th day of each month, each participating
64-4 subdivision shall pay or cause to be paid to the retirement system
64-5 at the system's office:
64-6 (1) the member contributions, or "picked-up" member
64-7 contributions, provided for by Sections 845.402 and 845.403, which
64-8 shall be deposited to the individual accounts of the members; and
64-9 (2) the contributions that a subdivision is required
64-10 to make under this subtitle, which [an additional amount equal to
64-11 the total of contributions made by or on behalf of employees of the
64-12 subdivision under the provisions of Sections 845.402 and 845.403
64-13 for the preceding month, which additional amount] shall be
64-14 deposited to the account of the subdivision in the subdivision
64-15 accumulation fund.
64-16 SECTION 59. Section 845.406, Government Code, is amended to
64-17 read as follows:
64-18 Sec. 845.406. SUPPLEMENTAL DEATH BENEFITS PROGRAM. (a) In
64-19 addition to other contributions to the retirement system required
64-20 by this subtitle, each subdivision participating in the
64-21 supplemental death benefits fund monthly shall pay to the fund an
64-22 amount equal to the rate of contribution computed in accordance
64-23 with this section, multiplied by the total compensation for the
64-24 month of the members employed by the subdivision.
64-25 (b) A limitation on subdivision contribution rates provided
64-26 by this subtitle does not apply to the rate of the contribution to
65-1 the supplemental death benefits fund.
65-2 (c) At [As soon as practical after the supplemental death
65-3 benefits program is established and at] the time of each
65-4 investigation of members' mortality and service experience required
65-5 by Section 845.110, the actuary shall investigate the mortality
65-6 experience of the members and eligible annuitants participating in
65-7 the supplemental death benefits program. On the basis of the
65-8 result of that investigation, the actuary shall recommend to the
65-9 board of trustees rates and tables necessary to determine
65-10 supplemental death benefits contribution rates. The rates and
65-11 tables may provide for the anticipated mortality experience of the
65-12 persons covered under the supplemental death benefits fund and for
65-13 a contingency reserve.
65-14 (d) Before a subdivision's participation date in the
65-15 supplemental death benefits fund and before January 1 of each
65-16 subsequent year, the actuary shall compute, on the basis of rates
65-17 and tables adopted by the board of trustees, the supplemental death
65-18 benefits contribution rate of a subdivision participating in the
65-19 supplemental death benefits contribution fund. The rate must be
65-20 expressed as a percentage of the compensation of members employed
65-21 by the subdivision. When the rate is approved by the board of
65-22 trustees, the rate is effective for the calendar year for which it
65-23 was approved.
65-24 (e) The board of trustees, in the exercise of its discretion
65-25 to manage the assets of the retirement system, may lend money to
65-26 the supplemental death benefits fund if the amount in the fund is
66-1 insufficient to pay the supplemental death benefits due. Any loan
66-2 is an investment of the retirement system and must be repaid solely
66-3 from future contributions to the supplemental death benefits fund
66-4 and its share of trust earnings. The terms of the loan shall be
66-5 set by the board of trustees, but the loan must bear a commercially
66-6 reasonable interest rate. The board may adjust future
66-7 contributions to the supplemental death benefits fund for purposes
66-8 of repayment of the loan [If the balance in the supplemental death
66-9 benefits fund is insufficient to pay the supplemental death
66-10 benefits due, the board of trustees may direct that, to the extent
66-11 available, an amount equal to the amount of the deficiency be
66-12 transferred from the general reserves account of the endowment fund
66-13 to the supplemental death benefits fund. The board may adjust
66-14 future contributions to the supplemental death benefits fund to
66-15 repay to the general reserves account the transferred amount].
66-16 (f) [If the total number of members covered by the
66-17 supplemental death benefits fund becomes fewer than 4,000, the
66-18 board of trustees may order that the fund be discontinued and all
66-19 coverage terminated. The termination date must be December 31 of a
66-20 year designated by the board and may not be before the expiration
66-21 of six months after the date on which the order of termination was
66-22 adopted.]
66-23 [(g)] To protect against adverse claim experience, the board
66-24 of trustees may secure reinsurance from one or more stock insurance
66-25 companies doing business in this state if the board determines that
66-26 reinsurance is necessary. The retirement system shall pay the
67-1 premiums for reinsurance from the supplemental death benefits fund.
67-2 SECTION 60. Subchapter E, Chapter 845, Government Code, is
67-3 amended by adding Section 845.407 to read as follows:
67-4 Sec. 845.407. PENALTY FOR LATE CONTRIBUTIONS. (a) A
67-5 participating subdivision that fails to provide the information
67-6 required by Section 845.403 or to pay all contributions required by
67-7 this subchapter to be made and remitted to the retirement system
67-8 before the 16th day of the month in which they are due shall pay a
67-9 penalty under this section. The penalty for a past-due monthly
67-10 remission is equal to interest on the past-due amounts for each day
67-11 past due at a nominal interest rate of 12 percent, plus a $500
67-12 administrative fee. If the penalty is not paid within three months
67-13 after the date notice of the penalty has been sent to the
67-14 subdivision, the retirement system shall deduct the penalty from
67-15 the subdivision's account in the subdivision accumulation fund.
67-16 The interest portion of the penalty shall be deposited by the
67-17 retirement system in the distributable income account of the
67-18 interest fund. The administrative fee portion of the penalty shall
67-19 be deposited by the retirement system in the expense fund.
67-20 (b) Payment and required reports are considered to be made
67-21 when received by the retirement system.
67-22 SECTION 61. Subchapter E, Chapter 845, Government Code, is
67-23 amended by adding Section 845.408 to read as follows:
67-24 Sec. 845.408. ADDITIONAL OPTIONAL DEPOSITS BY SUBDIVISIONS.
67-25 In addition to the deposits that a subdivision is required to make
67-26 under this subtitle, the governing body of a participating
68-1 subdivision may elect to deposit to the subdivision's account in
68-2 the subdivision accumulation fund one or more lump-sum payments.
68-3 Once a payment is deposited, it cannot be withdrawn from that fund
68-4 by the subdivision.
68-5 SECTION 62. Subsection (e), Section 845.505, Government
68-6 Code, is amended to read as follows:
68-7 (e) If a person files with the retirement system a valid
68-8 application for retirement based on an account that has been closed
68-9 under Subsection (a)[, (b),] or (c), the retirement system shall
68-10 restore the member's individual account in the employees saving
68-11 fund and pay a retirement annuity computed as of the date on which
68-12 the annuity would have been required to begin under this subtitle.
68-13 All annuity payments that previously would have been paid if the
68-14 annuity had begun on the date required under this subtitle will be
68-15 paid to the person as a single sum.
68-16 SECTION 63. Notwithstanding Section 844.407, Government
68-17 Code, as added by this Act, a subdivision participating in the
68-18 Texas County and District Retirement System that is not subject to
68-19 Subchapter H, Chapter 844, Government Code, may before December 31,
68-20 1999, elect not to have Subdivision (1), Subsection (a), Section
68-21 844.407, apply to the subdivision by filing a notice of that
68-22 election with the retirement system before that date. A
68-23 subdivision that makes an election under this section may
68-24 subsequently elect to have Subdivision (1), Subsection (a), Section
68-25 844.407, Government Code, as added by this Act, apply to the
68-26 subdivision.
69-1 SECTION 64. The following provisions of the Government Code
69-2 are repealed:
69-3 (1) Section 842.005;
69-4 (2) Section 843.202;
69-5 (3) Section 843.404;
69-6 (4) Section 843.603;
69-7 (5) Section 843.702;
69-8 (6) Sections 844.007(d), (e), (f), and (g);
69-9 (7) Section 844.105;
69-10 (8) Section 844.106;
69-11 (9) Section 844.107;
69-12 (10) Section 844.108;
69-13 (11) Section 844.201;
69-14 (12) Section 844.203;
69-15 (13) Section 844.204;
69-16 (14) Section 844.205;
69-17 (15) Section 844.206; and
69-18 (16) Sections 844.502(e) and (f).
69-19 SECTION 65. This Act takes effect December 31, 1999, except
69-20 Sections 13, 16, 63, and this section, which take effect September
69-21 1, 1999.
69-22 SECTION 66. The importance of this legislation and the
69-23 crowded condition of the calendars in both houses create an
69-24 emergency and an imperative public necessity that the
69-25 constitutional rule requiring bills to be read on three several
69-26 days in each house be suspended, and this rule is hereby suspended.
S.B. No. 1129
________________________________ ________________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 1129 passed the Senate on
April 15, 1999, by a viva-voce vote; May 10, 1999, Senate refused
to concur in House amendment and requested appointment of
Conference Committee; May 11, 1999, House granted request of the
Senate; May 24, 1999, Senate adopted Conference Committee Report by
a viva-voce vote.
_______________________________
Secretary of the Senate
I hereby certify that S.B. No. 1129 passed the House, with
amendment, on May 5, 1999, by a non-record vote; May 11, 1999,
House granted request of the Senate for appointment of Conference
Committee; May 26, 1999, House adopted Conference Committee Report
by a non-record vote.
_______________________________
Chief Clerk of the House
Approved:
________________________________
Date
________________________________
Governor