AN ACT
1-1 relating to programs and systems administered by the Employees
1-2 Retirement System of Texas.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 803.402, Government Code, is amended to
1-5 read as follows:
1-6 Sec. 803.402. RECORDS. Except as provided by Section
1-7 825.507, records of members and beneficiaries of a retirement
1-8 system to which this chapter applies that are in the custody of any
1-9 retirement [the] system to which this chapter applies are
1-10 [considered to be personnel records and] confidential and not
1-11 subject to disclosure and are exempt from the public access
1-12 provisions of [information under] Chapter 552. The records or
1-13 information in the records may be transferred between retirement
1-14 systems to which this chapter applies to the extent necessary to
1-15 administer the proportionate retirement program provided by this
1-16 chapter.
1-17 SECTION 2. Section 805.008, Government Code, is amended by
1-18 amending Subsection (c) and adding Subsection (h) to read as
1-19 follows:
1-20 (c) As an alternative to Subsections (a) and (b) and except
1-21 as provided by Subsection (h), the systems by rule may require the
1-22 system from which service credit is transferred to pay monthly an
1-23 amount equal to the portion of the actual value of the monthly
1-24 payment of the annuity that represents the percentage of the total
2-1 amount of service credit that is transferred.
2-2 (h) If a person elects to receive a partial lump-sum payment
2-3 under the law governing the system from which the person is
2-4 retiring, a transfer of an amount equal to the portion of the
2-5 actual value of a lump-sum payment that represents the percentage
2-6 of the amount of service credit transferred shall be made at the
2-7 time the lump-sum payment is made.
2-8 SECTION 3. Section 811.001, Government Code, is amended by
2-9 amending Subdivision (8) and adding Subdivision (18) to read as
2-10 follows:
2-11 (8) "Custodial officer" means a member of the
2-12 retirement system who is employed by the Board of Pardons and
2-13 Paroles or the Texas Department of Criminal Justice as a parole
2-14 officer or caseworker or who is employed by the institutional
2-15 division or the state jail division of the Texas Department of
2-16 Criminal Justice and certified by the department as having a normal
2-17 job assignment that requires frequent or infrequent regularly
2-18 planned contact with, and in close proximity to, inmates of the
2-19 institutional division or inmates or defendants confined in the
2-20 state jail division without the protection of bars, doors, security
2-21 screens, or similar devices and includes assignments normally
2-22 involving supervision or the potential for supervision of inmates
2-23 in inmate housing areas, educational or recreational facilities,
2-24 industrial shops, kitchens, laundries, medical areas, agricultural
2-25 shops or fields, or in other areas on or away from property of the
2-26 institutional division or the state jail division. The term
3-1 includes a member who transfers from the Texas Department of
3-2 Criminal Justice to the managed health care unit of The University
3-3 of Texas Medical Branch or the Texas Tech University Health
3-4 Sciences Center pursuant to Section 9.01, Chapter 238, Acts of the
3-5 73rd Legislature, 1993, elects at the time of transfer to retain
3-6 membership in the retirement system, and is certified by the
3-7 managed health care unit or the health sciences center as having a
3-8 normal job assignment described by this subdivision.
3-9 (18) "Parole officer" has the meaning assigned by
3-10 Section 508.001.
3-11 SECTION 4. Subsection (a), Section 812.101, Government Code,
3-12 is amended to read as follows:
3-13 (a) A member of the retirement system may withdraw all of
3-14 the member's accumulated contributions for service credited in the
3-15 employee class of membership if:
3-16 (1) the member does not hold a position included in
3-17 that class;
3-18 (2) the member does not assume or resume, during the
3-19 30 days after the date on [calendar month following the month in]
3-20 which the member terminates employment, a position included in that
3-21 class; and
3-22 (3) the member's application for withdrawal is filed
3-23 before the member assumes or resumes a position included in that
3-24 class.
3-25 SECTION 5. Section 812.104, Government Code, is amended by
3-26 amending Subsection (a) and adding Subsection (c) to read as
4-1 follows:
4-2 (a) Except as provided by Subsection (c), deposits
4-3 [Deposits] representing interest or membership fees that are
4-4 required of a member to establish service credit under Section
4-5 813.202, 813.302, 813.402, or 813.502 are not refundable.
4-6 (c) At the time a service retirement, disability retirement,
4-7 or death benefit annuity becomes payable, the retirement system
4-8 shall refund any contributions, interest, or membership fees used
4-9 to establish service credit that is not used in computing the
4-10 amount of the annuity.
4-11 SECTION 6. Subsection (b), Section 813.102, Government Code,
4-12 is amended to read as follows:
4-13 (b) A member may reestablish credit by depositing with the
4-14 retirement system in a lump sum the amount withdrawn from a
4-15 membership class, [plus all membership fees due,] plus interest
4-16 computed on the basis of the state fiscal year at an annual rate of
4-17 five percent from the date of withdrawal to the date of redeposit.
4-18 SECTION 7. Subsection (b), Section 813.104, Government Code,
4-19 is amended to read as follows:
4-20 (b) Except as provided by Subsection (c), payments may not
4-21 be made under a rule adopted under this section:
4-22 (1) to establish or reestablish service credit of a
4-23 person who is currently [has] retired or has died; or
4-24 (2) to establish current service under Section
4-25 813.201.
4-26 SECTION 8. Subsection (b), Section 813.201, Government Code,
5-1 is amended to read as follows:
5-2 (b) A member may not, after August 31, 1997 [1991], accrue
5-3 or establish [a total of more than 50 years of] service credit in
5-4 the employee class of membership when the total amount of service
5-5 credit, multiplied by the percentage in effect for computing
5-6 annuities under Section 814.105, would exceed the number 100. When
5-7 the maximum amount [a total of 50 years] of service credit is
5-8 accrued or established by a member in the employee class, member
5-9 and state contributions cease, although the member retains
5-10 membership subject to Section 812.005.
5-11 SECTION 9. Subsection (b), Section 813.202, Government Code,
5-12 is amended to read as follows:
5-13 (b) A member may establish credit under this section by
5-14 depositing with the retirement system in a lump sum a contribution
5-15 computed as provided by Section 813.404 or 813.505, [plus all
5-16 membership fees due,] plus interest computed on the basis of the
5-17 state fiscal year at an annual rate of 10 percent from the date the
5-18 service was performed to the date of deposit.
5-19 SECTION 10. Subsection (b), Section 813.402, Government
5-20 Code, is amended to read as follows:
5-21 (b) A member may establish credit under this section by
5-22 depositing with the retirement system in a lump sum a contribution
5-23 computed as provided by Section 813.404, [plus all membership fees
5-24 due,] plus interest computed at an annual rate of 10 percent from
5-25 the fiscal year in which the service was performed to the date of
5-26 deposit.
6-1 SECTION 11. Subsections (b) and (c), Section 813.506,
6-2 Government Code, are amended to read as follows:
6-3 (b) To be creditable as custodial officer service, service
6-4 performed must be performed as a parole officer or caseworker or
6-5 must meet the requirements of the rules adopted under Subsection
6-6 (a) and [may] be performed by persons in one of the following job
6-7 categories:
6-8 (1) all persons classified as Correctional Officer I
6-9 through warden, including training officers and special operations
6-10 reaction team officers;
6-11 (2) all other employees assigned to work on a unit and
6-12 whose jobs require routine contact with inmates or defendants
6-13 confined in the state jail division, including but not limited to
6-14 farm managers, livestock supervisors, maintenance foremen, shop
6-15 foremen, medical assistants, food service supervisors, stewards,
6-16 education consultants, commodity specialists, and correctional
6-17 counselors;
6-18 (3) employees assigned to administrative offices whose
6-19 jobs require routine contact with inmates or defendants confined in
6-20 the state jail division at least 50 percent of the time, including
6-21 but not limited to investigators, compliance monitors, accountants
6-22 routinely required to audit unit operations, sociologists,
6-23 interviewers, classification officers, and supervising counselors;
6-24 and
6-25 (4) administrative positions whose jobs require
6-26 response to emergency situations involving inmates or defendants
7-1 confined in the state jail division, including but except as
7-2 specified not limited to the director, deputy directors, assistant
7-3 directors, and not more than 25 administrative duty officers.
7-4 (c) The Texas Department of Criminal Justice, the managed
7-5 health care unit of The University of Texas Medical Branch[,] or
7-6 the Texas Tech University Health Sciences Center, or the Board of
7-7 Pardons and Paroles, as applicable, shall determine a person's
7-8 eligibility to receive credit as a custodial officer. A
7-9 determination of the department, [or] unit, or board may not be
7-10 appealed by an employee but is subject to change by the retirement
7-11 system.
7-12 SECTION 12. Subchapter F, Chapter 813, Government Code, is
7-13 amended by adding Section 813.511 to read as follows:
7-14 Sec. 813.511. CREDIT FOR ACCUMULATED ANNUAL LEAVE. (a) A
7-15 member who holds a position included in the employee class of
7-16 membership during the month that includes the effective date of the
7-17 member's retirement and who retires based on service or a
7-18 disability is entitled to service credit in the retirement system
7-19 for the member's annual leave that has accumulated and is unused on
7-20 the last day of employment. Annual leave is creditable in the
7-21 retirement system at the rate of one month of service credit for
7-22 each 20 days, or 160 hours, of accumulated annual leave and one
7-23 month for each fraction of days or hours remaining after division
7-24 of the total hours of accumulated annual leave by 160.
7-25 (b) A member who holds a position included in the employee
7-26 class may use annual leave creditable under this section to satisfy
8-1 service requirements for retirement under Section 814.104 or
8-2 814.107 if the annual leave attributed to the eligibility
8-3 requirements remains otherwise unused on the last day of
8-4 employment.
8-5 (c) Except as provided by Subsection (d), the disbursing
8-6 officer of each department or agency shall, before the 11th day
8-7 after the effective date of retirement of one or more employees of
8-8 the department or agency, certify to the retirement system:
8-9 (1) the name of each person whose retirement from the
8-10 department or agency, and from state service, became effective
8-11 during the preceding month; and
8-12 (2) the amount of the person's accumulated annual
8-13 leave on the last day of employment.
8-14 (d) The disbursing officer of a department or agency that
8-15 employs a member who applies for retirement under Subsection (b)
8-16 shall, not more than 90 or less than 30 days before the effective
8-17 date of the member's retirement, certify to the retirement system
8-18 the amount of the member's accumulated and unused annual leave.
8-19 The officer shall immediately notify the retirement system if the
8-20 member uses annual leave after the date of certification.
8-21 (e) On receipt of a certification under Subsection (c) or
8-22 (d), the retirement system shall grant any credit to which a
8-23 retiring member or retiree who is a subject of the certification is
8-24 entitled. An increase in the computation of an annuity because of
8-25 credit provided by this section after a certification under
8-26 Subsection (d) begins with the first payment that becomes due after
9-1 certification.
9-2 (f) The retirement system shall cancel the retirement of a
9-3 person who used annual leave creditable under this section to
9-4 qualify for service retirement if the annual leave is otherwise
9-5 used by the person before the effective date of retirement.
9-6 SECTION 13. Section 814.104, Government Code, is amended by
9-7 amending Subsection (a) and adding Subsection (c) to read as
9-8 follows:
9-9 (a) Except as provided by Section 814.102 or by rule adopted
9-10 under Section 813.304(d) or 803.202(a)(2) [803.202(2)], a member
9-11 who has service credit in the retirement system is eligible to
9-12 retire and receive a service retirement annuity if the member:
9-13 (1) [if the member] is at least 60 years old and has
9-14 at least 5 years of service credit in the employee class; or
9-15 (2) has at least 5 years of service credit in the
9-16 employee class and [if] the sum of the member's age and amount of
9-17 service credit in the employee class, including months of age and
9-18 credit, equals or exceeds the number 80.
9-19 (c) For the sole purpose of determining eligibility to
9-20 receive a service retirement annuity, the retirement system shall
9-21 consider service performed as a participant in the optional
9-22 retirement program under Chapter 830 as if it were service for
9-23 which credit is established in the retirement system.
9-24 SECTION 14. Section 814.1041, Government Code, is amended to
9-25 read as follows:
9-26 Sec. 814.1041. TEMPORARY SERVICE RETIREMENT OPTION FOR
10-1 MEMBERS AFFECTED BY PRIVATIZATION OR OTHER REDUCTION IN WORKFORCE.
10-2 (a) This section applies only to members of the employee class who
10-3 are not otherwise eligible to retire and whose positions with the
10-4 Texas Workforce Commission, the Texas Department of Human Services,
10-5 [or] the Texas Department of Mental Health and Mental Retardation,
10-6 or the Texas Department of Health are eliminated as a result of
10-7 contracts with private service providers or other reductions in
10-8 services provided by those agencies and who separate from state
10-9 service at that time.
10-10 (b) A member described by Subsection (a) is eligible to
10-11 retire and receive a service retirement annuity if the member's age
10-12 and service credit, each equally increased only as needed to meet
10-13 minimum age and service requirements, but not by more than [by]
10-14 three years, would meet the minimum age and service requirements
10-15 for service retirement under Section 814.104(a) at the time the
10-16 member separates from state service as described by Subsection (a).
10-17 The annuity of a person who retires under this subsection is
10-18 computed on the person's accrued service credit increased by the
10-19 minimum amount of service credit necessary to meet the service
10-20 credit requirement for retirement, but not by more than three
10-21 years.
10-22 (c) [A member described by Subsection (a) becomes eligible
10-23 to retire and receive a service retirement annuity on the date on
10-24 which the member would have met the age and service requirements
10-25 for service retirement under Section 814.104(a) had the member
10-26 remained employed by the state if, on the date of separation from
11-1 state service, the member's age and service credit, each increased
11-2 by five years, would meet age and service requirements for service
11-3 retirement under Section 814.104(a). The annuity of a person who
11-4 retires under this subsection is computed on the person's accrued
11-5 service credit.]
11-6 [(d) If a member described by Subsection (c) is reemployed
11-7 by the state before retirement, the time between the member's
11-8 separation from state service and reemployment may be used only to
11-9 compute eligibility for service retirement and may not be used to
11-10 compute the amount of any service retirement annuity.]
11-11 [(e)] A member who applies to retire under this section and
11-12 the state agency from which the member separated from service shall
11-13 provide documentation required by the retirement system to
11-14 establish eligibility to retire under this section.
11-15 (d) [(f)] This section applies only to positions eliminated
11-16 by privatization or other reductions in workforce before September
11-17 1, 2001 [1999].
11-18 SECTION 15. Subchapter B, Chapter 814, Government Code, is
11-19 amended by adding Section 814.1042 to read as follows:
11-20 Sec. 814.1042. SERVICE FOR CERTAIN GOVERNMENTAL EMPLOYERS.
11-21 (a) For the sole purpose of determining eligibility to receive a
11-22 service retirement annuity under Section 814.104(a)(2), the
11-23 retirement system shall consider not more than 60 months, or
11-24 portions of months, of service performed for a Texas governmental
11-25 employer by a member who has at least five years of service credit,
11-26 excluding military service, in the employee class as if it were
12-1 service for which credit is established in the retirement system.
12-2 (b) A member who seeks the application of this section must
12-3 provide documentation satisfactory to the retirement system of the
12-4 amount of service performed for the governmental employer.
12-5 (c) Service described by this section may not be used in
12-6 determining eligibility for participation in the Texas Employees
12-7 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
12-8 Texas Insurance Code).
12-9 SECTION 16. Subsections (c), (d), and (e), Section 814.107,
12-10 Government Code, are amended to read as follows:
12-11 (c) The standard combined service retirement annuity that is
12-12 payable under this section is based on retirement on or after the
12-13 attainment of the normal retirement age, which for purposes of this
12-14 section is the earlier of either the age of 50 or the age at which
12-15 the sum of the member's age and amount of service credit in the
12-16 employee class equals the number 80 [at the age of 50 or older]. A
12-17 law enforcement or custodial officer who retires before attaining
12-18 the normal retirement age [of 50] is entitled to an annuity that is
12-19 actuarially reduced from the annuity available at the normal
12-20 retirement age [of 50] to the law enforcement or custodial officer
12-21 service credit annuity amount available at the sum of the member's
12-22 age and amount of employee class service credit. The annuity
12-23 [earlier retirement age and] is payable from the law enforcement
12-24 and custodial officer supplemental retirement fund.
12-25 (d) A member who retires under this section retires
12-26 simultaneously from the employee class of membership. Benefits for
13-1 service in the employee class of membership become payable from the
13-2 trust fund established by Section 815.310 at the normal retirement
13-3 age [of 50] under the computation provided by Section 814.105.
13-4 Optional retirement annuities provided by Section 814.108 are
13-5 available to a member eligible to receive a service retirement
13-6 annuity under this section, but the same optional plan and designee
13-7 must be selected for the portion of the annuity payable from the
13-8 law enforcement and custodial officer supplemental retirement fund
13-9 and the portion payable from the trust fund established by Section
13-10 815.310.
13-11 (e) The amount payable from the law enforcement and
13-12 custodial officer supplemental retirement fund is reducible by the
13-13 amount paid from the trust fund established by Section 815.310 for
13-14 service as a law enforcement or custodial officer. The total
13-15 combined amount of an annuity under this section may not be less
13-16 than the authorized benefit under Subsection (b) subtracted by any
13-17 amount necessary because of selection of an optional annuity,
13-18 because of retirement before the normal retirement age [of 50], or
13-19 as provided by Subsection (f).
13-20 SECTION 17. Subchapter B, Chapter 814, Government Code, is
13-21 amended by adding Section 814.1082 to read as follows:
13-22 Sec. 814.1082. PARTIAL LUMP-SUM OPTION. (a) A member who
13-23 is eligible for an unreduced service retirement annuity may select
13-24 a standard retirement annuity or an optional retirement annuity
13-25 described by Section 814.108 together with a partial lump-sum
13-26 distribution.
14-1 (b) The amount of the lump-sum distribution under this
14-2 section may not exceed the sum of 36 months of a standard service
14-3 retirement annuity computed without regard to this section.
14-4 (c) The service retirement annuity selected by the member
14-5 shall be actuarially reduced to reflect the lump-sum option
14-6 selected by the member and shall be actuarially equivalent to a
14-7 standard or optional service retirement annuity, as applicable,
14-8 without the partial lump-sum distribution. The annuity and lump
14-9 sum shall be computed to result in no actuarial loss to the
14-10 retirement system.
14-11 (d) Unless otherwise specified in rules adopted by the board
14-12 of trustees, the lump-sum distribution will be made as a single
14-13 payment payable at the time that the first monthly annuity payment
14-14 is paid to the retiree.
14-15 (e) The amount of the lump-sum distribution will be deducted
14-16 from any amount otherwise payable under Section 814.505.
14-17 (f) The partial lump-sum option under this section may be
14-18 elected only once by a member and may not be elected by a retiree.
14-19 A member retiring under the proportionate retirement program under
14-20 Chapter 803 is not eligible for the partial lump-sum option.
14-21 (g) Before a retiring member selects a partial lump-sum
14-22 distribution under this section, the retirement system shall
14-23 provide a written notice to the member of the amount by which the
14-24 member's annuity will be reduced because of the selection. The
14-25 member shall be asked to sign a copy of or a receipt for the
14-26 notice, and the retirement system shall maintain the signed copy or
15-1 receipt.
15-2 (h) The board of trustees may adopt rules for the
15-3 implementation of this section and may authorize the option to be
15-4 used for a death benefit annuity. This section does not apply to a
15-5 disability retirement annuity.
15-6 SECTION 18. Section 814.202, Government Code, is amended by
15-7 adding Subsection (d) to read as follows:
15-8 (d) For the sole purpose of determining eligibility to
15-9 receive a disability retirement annuity under Subsection (a)(3),
15-10 the retirement system shall consider service performed as a
15-11 participant in the optional retirement program under Chapter 830 as
15-12 if it were service for which credit is established in the
15-13 retirement system.
15-14 SECTION 19. Subsection (b), Section 814.302, Government
15-15 Code, is amended to read as follows:
15-16 (b) If a person dies who, at the time of death, was a
15-17 contributing member of a retirement program administered by the
15-18 board of trustees and was eligible, having met the requirements of
15-19 service credit and attained age, for a service retirement annuity
15-20 based on service in one or more board-administered programs or was
15-21 a contributing member of the employee class, had at least three
15-22 years of service credit in that class, and would have been eligible
15-23 to retire under the proportionate retirement program under Chapter
15-24 803, but was not eligible to select a death benefit plan, the
15-25 person's surviving spouse may select a plan in the same manner that
15-26 the decedent could have made the selection if the decedent had
16-1 retired on the last day of the month in which the person died. If
16-2 there is no surviving spouse, the guardian of the decedent's
16-3 surviving minor children may select a plan. If the decedent is not
16-4 survived by a spouse or minor children, an annuity may not be paid
16-5 under this subsection.
16-6 SECTION 20. Section 815.103, Government Code, is amended by
16-7 adding Subsection (d) to read as follows:
16-8 (d) The board of trustees may accept on behalf of the
16-9 retirement system gifts of money or other property from any public
16-10 or private source.
16-11 SECTION 21. Subsection (e), Section 815.110, Government
16-12 Code, is amended to read as follows:
16-13 (e) The board of trustees [annually] shall select an
16-14 independent auditor to perform an annual [a] financial audit of the
16-15 retirement system. The selection shall be in accordance with the
16-16 requirements of Chapter 2254 for obtaining the services of a
16-17 certified public accountant [made under a competitive bidding
16-18 process in which the state auditor is eligible to bid].
16-19 SECTION 22. Subsection (f), Section 815.202, Government
16-20 Code, is amended to read as follows:
16-21 (f) The board of trustees may specifically delegate any
16-22 right, power, or duty imposed or conferred on the executive
16-23 director by law to another employee of the retirement system. If
16-24 not so specifically delegated, the executive director may delegate
16-25 to another employee of the retirement system any right, power, or
16-26 duty assigned to the executive director.
17-1 SECTION 23. Section 815.208, Government Code, is amended by
17-2 adding Subsections (d) and (e) to read as follows:
17-3 (d) The board of trustees may compensate employees of the
17-4 retirement system, whether subject to or exempt from the overtime
17-5 provisions of the Fair Labor Standards Act of 1938 (29 U.S.C.
17-6 Section 201 et seq.), at the rate equal to the employees' regular
17-7 rate of pay for work performed on a legal holiday or for other
17-8 compensatory time accrued, when taking compensatory time off would
17-9 be disruptive to the system's normal business functions.
17-10 (e) The retirement system is exempt from Subchapter K,
17-11 Chapter 659, and Chapter 660, to the extent the board of trustees
17-12 determines an exemption is necessary for the performance of
17-13 fiduciary duties.
17-14 SECTION 24. Section 815.301, Government Code, is amended by
17-15 adding Subsection (f) to read as follows:
17-16 (f) For purposes of the investment authority of the board of
17-17 trustees under Section 67, Article XVI, Texas Constitution,
17-18 "securities" means any investment instrument within the meaning of
17-19 the term as defined by Section 4, The Securities Act (Article
17-20 581-4, Vernon's Texas Civil Statutes), 15 U.S.C. Section 77b(a)(1),
17-21 or 15 U.S.C. Section 78c(a)(10).
17-22 SECTION 25. Section 815.322, Government Code, is amended to
17-23 read as follows:
17-24 Sec. 815.322. TRANSFER OF ASSETS TO ADJUST AMOUNT IN
17-25 RETIREMENT ANNUITY RESERVE ACCOUNT. After making the transfers
17-26 required by Section 815.318, the executive director [board of
18-1 trustees] shall make a transfer to make the amount in the
18-2 retirement annuity reserve account equal, as of the last day of
18-3 each fiscal year, to the actuarial present value of the annuities
18-4 for which a transfer of assets has been made as required by Section
18-5 815.319. The transfer shall be:
18-6 (1) a transfer from the retirement annuity reserve
18-7 account to the state accumulation account of the amount by which
18-8 the amount in the retirement annuity reserve account exceeds the
18-9 actuarial present value of the annuities; or
18-10 (2) a transfer from the state accumulation account to
18-11 the retirement annuity reserve account of the amount by which the
18-12 actuarial present value of the annuities exceeds the amount in the
18-13 retirement annuity reserve account.
18-14 SECTION 26. Subsection (a), Section 815.502, Government
18-15 Code, is amended to read as follows:
18-16 (a) If a valid application for payment based on money or
18-17 credit in a member's individual account in the employees saving
18-18 account is not filed with the retirement system before the
18-19 expiration of five years after the last day of the most recent
18-20 month of service for which the member has credit in the retirement
18-21 system, the retirement system may [shall] mail a notice to the
18-22 member at the member's most recent address as shown on system
18-23 records. If no address is available or if the notice is returned
18-24 unclaimed, the retirement system shall cause a notice to be
18-25 published in a newspaper of general circulation in the state.
18-26 SECTION 27. Section 815.503, Government Code, is amended to
19-1 read as follows:
19-2 Sec. 815.503. [MEMBERS'] RECORDS. (a) Records of members
19-3 and annuitants [beneficiaries] under retirement plans administered
19-4 by the retirement system that are in the custody of the system or
19-5 of an administrator, carrier, or other governmental agency acting
19-6 in cooperation with or on behalf of the retirement system are
19-7 [considered to be personnel records and are required to be treated
19-8 as] confidential and not subject to public disclosure and are
19-9 exempt from the public access provisions of Chapter 552, except as
19-10 otherwise provided by this section [information under Section
19-11 552.101].
19-12 (b) Records may be released to a member or annuitant or to
19-13 an authorized attorney, family member, or representative acting on
19-14 behalf of the member or annuitant. The retirement system may
19-15 release the records to an administrator, carrier, or agent or
19-16 attorney acting on behalf of the retirement system, to another
19-17 governmental entity having a legitimate need for the information to
19-18 perform the purposes of the retirement system, or to a party in
19-19 response to a subpoena issued under applicable law.
19-20 (c) The records of a member or annuitant remain confidential
19-21 after release to a person as authorized by this section. The
19-22 records of a member or annuitant may become part of the public
19-23 record of an administrative or judicial proceeding related to a
19-24 contested case under Subtitle D or E or this subtitle, unless the
19-25 records are closed to public access by a protective order issued
19-26 under applicable law.
20-1 SECTION 28. Section 815.505, Government Code, is amended to
20-2 read as follows:
20-3 Sec. 815.505. CERTIFICATION OF NAMES OF LAW ENFORCEMENT AND
20-4 CUSTODIAL OFFICERS. Not later than the 12th day of the month
20-5 following the month in which a person begins or ceases employment
20-6 as a law enforcement officer or custodial officer, the Public
20-7 Safety Commission, the Texas Alcoholic Beverage Commission, the
20-8 Parks and Wildlife Commission, the State Board of Pharmacy, the
20-9 Board of Pardons and Paroles, or the Texas Board of Criminal
20-10 Justice, as applicable, shall certify to the retirement system, in
20-11 the manner prescribed by the system, the name of the employee and
20-12 such other information as the system determines is necessary for
20-13 the crediting of service and financing of benefits under this
20-14 subtitle.
20-15 SECTION 29. Section 815.511, Government Code, is amended to
20-16 read as follows:
20-17 Sec. 815.511. [APPEAL OF] ADMINISTRATIVE DECISION; APPEAL
20-18 AND NEGOTIATION. (a) The board of trustees may modify or delete a
20-19 proposed finding of fact or conclusion of law contained in a
20-20 proposal for decision submitted by an administrative law judge or
20-21 other hearing examiner, or make alternative findings of fact and
20-22 conclusions of law, in a proceeding considered to be a contested
20-23 case under Chapter 2001. The board of trustees shall state in
20-24 writing the specific reason for its determination and may adopt
20-25 rules for the implementation of this subsection.
20-26 (b) A person aggrieved by a decision of any retirement
21-1 system administered by the board of trustees denying or limiting
21-2 membership, service credit, or eligibility for or the amount of
21-3 benefits payable by a system may appeal the decision to the board.
21-4 The appeal is considered to be an appeal of a contested case under
21-5 the administrative procedure law, Chapter 2001. On judicial appeal
21-6 the standard of review is by substantial evidence.
21-7 (c) Notwithstanding Subsection (b), the retirement system
21-8 and a person aggrieved by a decision of the system may at any time
21-9 informally negotiate an award of benefits. Negotiated benefits may
21-10 not exceed the maximum benefits otherwise available or required by
21-11 law.
21-12 (d) On behalf of the retirement system, the executive
21-13 director may refer an appeal made under Subsection (b) to the State
21-14 Office of Administrative Hearings for a hearing or, notwithstanding
21-15 Section 2003.021 or other law, employ or contract for the services
21-16 of an administrative law judge or hearing examiner not affiliated
21-17 with the State Office of Administrative Hearings to conduct the
21-18 hearing.
21-19 SECTION 30. Section 840.102, Government Code, is amended by
21-20 amending Subsection (a) and adding Subsection (g) to read as
21-21 follows:
21-22 (a) Except as provided by Subsection (g), each [Each]
21-23 payroll period, a judicial officer who is a member of the
21-24 retirement system is required to contribute six percent of the
21-25 officer's state compensation for the period to the retirement
21-26 system.
22-1 (g) A member who accrues 20 years of service credit in the
22-2 retirement system ceases making contributions under this section
22-3 but is considered a contributing member for all other purposes
22-4 under this subtitle.
22-5 SECTION 31. Subsection (b), Section 840.103, Government
22-6 Code, is amended to read as follows:
22-7 (b) Not later than December 31 [Before November 2] of each
22-8 even-numbered year, the retirement system shall certify to the
22-9 Legislative Budget Board and to the budget division of the
22-10 governor's office for review:
22-11 (1) an actuarial valuation of the retirement system to
22-12 determine the percentage of annual payroll required from the state
22-13 to finance fully the retirement system as provided by Section
22-14 840.106;
22-15 (2) an estimate of the amount necessary to pay the
22-16 state's contribution under Subdivision (1) for the following
22-17 biennium; and
22-18 (3) as a separate item, an estimate of the amount, in
22-19 addition to anticipated receipts from membership fees, required to
22-20 administer the retirement system for the following biennium.
22-21 SECTION 32. Section 840.301, Government Code, is amended by
22-22 adding Subsection (c) to read as follows:
22-23 (c) For purposes of the investment authority of the board of
22-24 trustees under Section 67, Article XVI, Texas Constitution,
22-25 "securities" means any investment instrument within the meaning of
22-26 the term as defined by Section 4, The Securities Act (Article
23-1 581-4, Vernon's Texas Civil Statutes), 15 U.S.C. Section 77b(a)(1),
23-2 or 15 U.S.C. Section 78c(a)(10).
23-3 SECTION 33. Section 840.402, Government Code, is amended to
23-4 read as follows:
23-5 Sec. 840.402. RETIREMENT SYSTEM RECORDS. Records of members
23-6 and annuitants [beneficiaries] of the retirement system [that are
23-7 in the custody of the system] are [considered to be personnel
23-8 records and are required to be treated as] confidential within the
23-9 terms of Section 815.503 [information under Section 552.101].
23-10 SECTION 34. Subdivision (18), Subsection (a), Section 3,
23-11 Texas Employees Uniform Group Insurance Benefits Act (Article
23-12 3.50-2, Vernon's Texas Insurance Code), is amended to read as
23-13 follows:
23-14 (18) "Institution of higher education" means any
23-15 public community/junior college or senior college or university, or
23-16 any other agency of higher education within the meaning and
23-17 jurisdiction of Chapter 61, Education Code, except The University
23-18 of Texas System and The Texas A&M University System. [The term
23-19 does not include Texas Tech University and the University of
23-20 Houston System unless either of these entities elects to
23-21 participate in accordance with Section 3A of this Act.]
23-22 SECTION 35. Section 3A, Texas Employees Uniform Group
23-23 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
23-24 Code), is amended to read as follows:
23-25 Sec. 3A. PARTICIPATION BY CERTAIN ENTITIES [CERTAIN
23-26 INSTITUTIONS MAY ELECT TO PARTICIPATE]. (a) The Texas Municipal
24-1 Retirement System and the Texas County and District Retirement
24-2 System shall [Texas Tech University, the University of Houston
24-3 System, or both may] participate in the Texas Employees Uniform
24-4 Group Insurance [Benefits] Program administered by the Employees
24-5 Retirement System of Texas under this Act. Participation is
24-6 limited to the officers and employees of the systems; eligible
24-7 dependents of the officers and employees; persons who have retired
24-8 from either system, who receive or are eligible to receive an
24-9 annuity from either system or under Chapter 803, Government Code,
24-10 based on at least 10 years of service credit, who have at least
24-11 three years of service with a department, including either system,
24-12 whose employees are authorized to participate in the program
24-13 provided by this Act, and who were officers or employees of either
24-14 system; and eligible dependents of the retired officers and
24-15 employees. An officer or employee of either system is an employee
24-16 for purposes of this Act, and a retired officer or employee of
24-17 either system is an annuitant for purposes of this Act.
24-18 Participation under this subsection does not include the governing
24-19 bodies of either system, the municipalities or subdivisions
24-20 participating in either system, or the trustees, officers, or
24-21 employees, or their dependents, of the participating municipalities
24-22 or subdivisions. A participant described by this subsection may
24-23 not receive a state contribution for premiums [The university or
24-24 system must notify the trustee of its election to participate not
24-25 later than April 1, 1992].
24-26 (b) A person who began employment with, or became an officer
25-1 of, the Texas Turnpike Authority within the three-year period
25-2 preceding August 31, 1997, who was an officer or employee of the
25-3 Texas Turnpike Authority on that date, who became an officer or
25-4 employee of the North Texas Tollway Authority on September 1, 1997,
25-5 and who retires or is eligible to retire with at least 10 years of
25-6 service credit under the proportionate retirement program
25-7 established by Chapter 803, Government Code, or under one of the
25-8 public retirement systems to which Chapter 803 applies may
25-9 participate in the programs and coverages provided by this Act as
25-10 an annuitant and may obtain coverage for the person's dependents as
25-11 any other participating annuitant. The North Texas Tollway
25-12 Authority is responsible for payment of the contributions the state
25-13 would make if the annuitants were state employees.
25-14 SECTION 36. Section 4B, Texas Employees Uniform Group
25-15 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
25-16 Code), is amended by adding Subsections (c-1), (c-2), and (c-3) to
25-17 read as follows:
25-18 (c-1) The board of trustees may modify or delete a proposed
25-19 finding of fact or conclusion of law contained in a proposal for
25-20 decision submitted by an administrative law judge or other hearing
25-21 examiner, or make alternative findings of fact and conclusions of
25-22 law, in a proceeding considered to be a contested case under
25-23 Chapter 2001, Government Code. The board of trustees shall state
25-24 in writing the specific reason for the determination and may adopt
25-25 rules for the implementation of this subsection.
25-26 (c-2) Notwithstanding Subsections (c) and (d) of this
26-1 section, the trustee and a person who has standing to pursue an
26-2 administrative appeal may at any time informally negotiate an award
26-3 of benefits. Negotiated benefits may not exceed the maximum
26-4 benefits otherwise available or required by law.
26-5 (c-3) On behalf of the trustee, the executive director may
26-6 refer an appeal made under Subsection (c) of this section to the
26-7 State Office of Administrative Hearings for a hearing or,
26-8 notwithstanding Section 2003.021, Government Code, or other law,
26-9 employ or contract for the services of an administrative law judge
26-10 or hearing examiner not affiliated with the State Office of
26-11 Administrative Hearings to conduct the hearing.
26-12 SECTION 37. Section 5, Texas Employees Uniform Group
26-13 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
26-14 Code), is amended by amending Subsections (a), (d), and (f) and
26-15 adding Subsection (e) to read as follows:
26-16 (a) The trustee is authorized, empowered, and directed to
26-17 establish plans of group coverages for active employees and retired
26-18 employees which in the trustee's discretion may include but are not
26-19 necessarily limited to the following: group life coverages,
26-20 accidental death and dismemberment, health benefits plans,
26-21 including but not limited to hospital care and benefits, surgical
26-22 care and treatment, medical care and treatment, dental care,
26-23 obstetrical benefits, prescribed drugs, medicines, and prosthetic
26-24 devices and supplemental benefits, supplies, and services in
26-25 conformity with the provisions of this Act, protection against
26-26 either long or short term loss of salary and any other group
27-1 coverages which in the discretion of the trustee with consultation
27-2 from the advisory committee shall be deemed advisable. All rules
27-3 and regulations shall be promulgated pursuant thereto. The trustee
27-4 shall determine the coverages desired for state employees and other
27-5 eligible participants [will submit this information to the State
27-6 Board of Insurance for any recommendations as to the types and
27-7 sufficiency of such coverages. The State Board of Insurance will
27-8 notify the board of trustees within 30 days as to any such
27-9 recommendations and will furnish the board of trustees with a list
27-10 of all carriers authorized to do business in the State of Texas who
27-11 would be eligible to bid on the coverages that are to be insured by
27-12 a carrier]. The trustee will notify eligible [those] carriers that
27-13 competitive bidding will be conducted and that they are to submit
27-14 their bids to the trustee [State Board of Insurance] by a specified
27-15 date if they wish to bid on the contract. An actuary selected by
27-16 the trustee shall advise the trustee as to the actuarial soundness
27-17 of the bids received. [The State Board of Insurance will, after
27-18 the designated closing date of receiving bids, examine and evaluate
27-19 the bidding contracts and certify their actuarial soundness to the
27-20 trustee within 15 days from the closing date.] The trustee shall
27-21 select the desired carrier or carriers and will notify the bidding
27-22 eligible carriers as to the results of the bidding. The trustee
27-23 shall select the desired carrier or carriers to provide services
27-24 that will [which shall] be in the best interest of the employees
27-25 covered by this Act. The trustee is not required to select the
27-26 lowest bid but shall take into consideration other factors such as
28-1 ability to service contracts, past experience, financial ability,
28-2 and other relevant criteria. Should the trustee select a carrier
28-3 whose bid differs from that advertised, such deviation shall be
28-4 recorded and the reasons for such deviation shall be fully
28-5 justified and explained in the minutes of the next meeting of the
28-6 trustee. The trustee shall submit the coverages provided by the
28-7 group plan for competitive bidding at least every six years.
28-8 (d) No department shall establish, continue, or authorize
28-9 payroll deductions or reductions for any benefits or coverage as
28-10 provided in this Act without the express approval of the trustee[,
28-11 except for benefits from the deferred compensation program
28-12 established pursuant to Chapter 197, Acts of the 63rd Legislature,
28-13 Regular Session, 1973 (Article 6252-3b, Vernon's Texas Civil
28-14 Statutes)].
28-15 (e) Before the first day of each state fiscal biennium, the
28-16 trustee shall estimate for an average 60-day period during the
28-17 biennium the expenditures from the fund anticipated for self-funded
28-18 plans, considering claims and administrative expenses for those
28-19 plans that are projected to be incurred. The trustee shall place
28-20 the estimated amount in a contingency reserve fund to provide for
28-21 adverse fluctuations in claims or administrative expenses. The
28-22 trustee shall include in each request for legislative
28-23 appropriations to the program the amount the trustee determines to
28-24 be necessary to maintain the contingency reserve fund at the level
28-25 required by this subsection. The trustee may invest and reinvest
28-26 any portion of the contingency reserve fund under the standard of
29-1 care provided by Section 815.307, Government Code, considering the
29-2 functional need to provide for adverse fluctuations in claims or
29-3 administrative expenses. The interest on, earnings of, and
29-4 proceeds from the sale of investments of assets in the contingency
29-5 reserve fund shall be credited to the fund.
29-6 (f) The trustee, in its sole discretion and in accordance
29-7 with the requirements of this section, shall determine those plans
29-8 of coverages for which the trustee does not intend to purchase
29-9 insurance and which it intends to provide directly from the
29-10 Employees Life, Accident, and Health Insurance and Benefits Fund.
29-11 Any plan of coverages for which the trustee does not purchase
29-12 insurance but provides under this Act on a self-funded basis is
29-13 exempt from any other insurance law unless the law expressly
29-14 applies to this plan or this Act. A qualified actuary selected by
29-15 the trustee shall advise the trustee as to an actuarially sound
29-16 level of contributions required to provide coverages directly from
29-17 the fund. [The trustee shall make an estimate of the unrestricted
29-18 balance of the fund. Unless such estimated unrestricted balance is
29-19 equal to at least 10 percent of the total benefits expected to be
29-20 provided directly from the fund as a result of claims incurred
29-21 during the fiscal year, the trustee shall include in the
29-22 contributions required the amount necessary to establish an
29-23 unrestricted balance in the fund of not less than 10 percent. The
29-24 unrestricted balance shall be placed in a contingency reserve fund
29-25 to provide for adverse fluctuations in future charges, claims,
29-26 costs, or expenses of the program.]
30-1 SECTION 38. Section 6, Texas Employees Uniform Group
30-2 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
30-3 Code), is amended to read as follows:
30-4 Sec. 6. BENEFIT CERTIFICATES; IDENTIFICATION CARDS. (a) The
30-5 trustees shall provide for the issuance to each employee insured
30-6 under this Act a certificate of insurance setting forth the
30-7 benefits to which the employee is entitled, to whom the benefits
30-8 are payable, to whom the claims shall be submitted, and summarizing
30-9 the provisions of the policy principally affecting the employee.
30-10 (b) The trustee may issue a single identification card to
30-11 participants in a health benefits plan and separately administered
30-12 coverage under this Act that offers pharmacy benefits. The card
30-13 may contain information regarding both health and pharmacy
30-14 benefits.
30-15 SECTION 39. Section 7, Texas Employees Uniform Group
30-16 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
30-17 Code), is amended to read as follows:
30-18 Sec. 7. ANNUAL REPORT. The [As soon as practicable after
30-19 the end of each calendar year but not later than 90 days
30-20 thereafter, the] trustee shall make a written report not later than
30-21 January 1 of each year to the governor, lieutenant governor,
30-22 speaker of the house of representatives, and Legislative Budget
30-23 Board [State Board of Insurance] concerning the coverages provided
30-24 and the benefits and services being received by all employees
30-25 insured under the provisions of this Act and including information
30-26 about the effectiveness and efficiency of managed care cost
31-1 containment practices and fraud detection and prevention
31-2 procedures. [It shall be the duty of the State Board of Insurance
31-3 to review such report and advise the trustee in regard to the
31-4 features of the coverages provided for employees and cooperate
31-5 fully with the trustee in carrying out the purposes of the Act.]
31-6 SECTION 40. Section 8, Texas Employees Uniform Group
31-7 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
31-8 Code), is amended to read as follows:
31-9 Sec. 8. REINSURANCE. The trustee, in its sole discretion
31-10 and under conditions it approves, may reinsure any coverage that it
31-11 has determined will be provided directly from the fund in
31-12 accordance with Section 5(f) of this Act. [(a) The trustee shall
31-13 arrange with any carrier or carriers issuing any policy or policies
31-14 under this Act for the reinsurance, under conditions approved by
31-15 the trustee, of portions of the total amount of insurance under
31-16 such policy or policies, with other qualified carriers which elect
31-17 to participate in the reinsurance.]
31-18 [(b) The trustee shall determine for and in advance of a
31-19 policy year which qualified carriers are eligible to participate as
31-20 reinsurers and the amount of insurance under a policy or policies
31-21 which is to be allocated to the issuing company and reinsurers.
31-22 The trustee shall make this determination when a participating
31-23 company withdraws.]
31-24 SECTION 41. Section 10, Texas Employees Uniform Group
31-25 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
31-26 Code), is amended by adding Subsection (c) to read as follows:
32-1 (c) The records of a participant in the Texas Employees
32-2 Uniform Group Insurance Program in the custody of the trustee, or
32-3 of an administrator or carrier acting on behalf of the trustee, are
32-4 confidential and not subject to disclosure and are exempt from the
32-5 public access provisions of Chapter 552, Government Code, except as
32-6 provided by this subsection. Records may be released to a
32-7 participant or to an authorized attorney, family member, or
32-8 representative acting on behalf of the participant. The trustee
32-9 may release the records to an administrator, carrier, or agent or
32-10 attorney acting on behalf of the trustee, to another governmental
32-11 entity, to a medical provider of the participant for the purpose of
32-12 carrying out the purposes of this Act, or to a party in response to
32-13 a subpoena issued under applicable law. The records of a
32-14 participant remain confidential after release to a person as
32-15 authorized by this subsection. The records of a participant may
32-16 become part of the public record of an administrative or judicial
32-17 proceeding related to a contested case under this Act, unless the
32-18 records are closed to public access by a protective order issued
32-19 under applicable law.
32-20 SECTION 42. Subdivision (3), Subsection (e), Section 11,
32-21 Texas Employees Uniform Group Insurance Benefits Act (Article
32-22 3.50-2, Vernon's Texas Insurance Code), is amended to read as
32-23 follows:
32-24 (3) An annuitant [A retiree] participating in optional
32-25 term life insurance coverage is not eligible for premium-waived
32-26 extended insurance benefits [or accelerated life insurance
33-1 benefits] if the total disability [or terminal condition,
33-2 respectively,] begins after the date of retirement. Accidental
33-3 death and dismemberment insurance coverage ceases on the date of
33-4 retirement, regardless of age. An annuitant participating in
33-5 optional term life insurance coverage is eligible for accelerated
33-6 life insurance benefits as provided by rules adopted under the
33-7 authority of Subsection (d) of this section, as added by Chapter
33-8 1048, Acts of the 75th Legislature, Regular Session, 1997.
33-9 SECTION 43. Section 11A, Texas Employees Uniform Group
33-10 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
33-11 Code), is amended to read as follows:
33-12 Sec. 11A. PAYMENT OF ACCELERATED BENEFITS; IRREVOCABLE
33-13 DESIGNATION OF BENEFICIARY. [(a)] The trustee shall adopt rules
33-14 requiring a group life insurance program provided to employees,
33-15 including annuitants or dependents, to include a provision allowing
33-16 the employee, annuitant, or dependent to make, in conjunction with
33-17 receipt of a viatical settlement, an irrevocable designation of
33-18 beneficiary for part or all of the group life coverage benefits. A
33-19 viatical settlement is not valid for any coverage under the Texas
33-20 Employees Uniform Group Insurance Program unless the employee,
33-21 annuitant, or dependent has a terminal illness or terminal injury,
33-22 as defined by rules adopted by the trustee, at the time application
33-23 for benefits is made.[:]
33-24 [(1) elect to receive an accelerated benefit under
33-25 Article 3.50-6, Insurance Code, subject to the provisions of that
33-26 article; or]
34-1 [(2) make, in conjunction with receipt of a viatical
34-2 settlement, an irrevocable designation of a beneficiary for all or
34-3 a part of the group life coverage benefits.]
34-4 [(b)] In this section, "viatical settlement" has the meaning
34-5 assigned by Article 3.50-6A, Insurance Code.
34-6 SECTION 44. Section 13, Texas Employees Uniform Group
34-7 Insurance Benefits Act (Article 3.50-2, Vernon's Texas Insurance
34-8 Code), is amended by adding Subsection (e) to read as follows:
34-9 (e) Except as provided by Section 13A of this Act, on
34-10 application to the trustee and arrangement for payment of
34-11 contributions, a former member of a board or commission described
34-12 by Section 3(a)(5)(A)(vi) of this Act or a former member of the
34-13 governing body of an institution of higher education remains
34-14 eligible for participation in a group health coverage plan offered
34-15 under this Act as long as no lapse in coverage occurs after the end
34-16 of the former member's term. A participant described by this
34-17 subsection may not receive a state contribution for premiums, but
34-18 the governing body of an institution of higher education may elect
34-19 to pay from local funds part or all of the contributions the state
34-20 would pay for similar coverage of other participants in the
34-21 program. The participant's contribution for coverage under a group
34-22 health coverage plan may not be greater than the contribution for
34-23 continuation coverage under the Consolidated Omnibus Budget
34-24 Reconciliation Act of 1985 (Pub. L. No. 99-272).
34-25 SECTION 45. Subsection (d), Section 13B, Texas Employees
34-26 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
35-1 Texas Insurance Code), is amended to read as follows:
35-2 (d) Each employee shall be enrolled in the premium
35-3 conversion benefit portion of the cafeteria plan [unless the
35-4 employee notifies the trustee in writing that the employee elects
35-5 not to be enrolled]. Notwithstanding any provision of Section 16B
35-6 of this Act to the contrary, the trustee may not establish a fee or
35-7 charge for administering the premium conversion benefit portion of
35-8 the cafeteria plan.
35-9 SECTION 46. The Texas Employees Uniform Group Insurance
35-10 Benefits Act (Article 3.50-2, Vernon's Texas Insurance Code) is
35-11 amended by adding Section 16A to read as follows:
35-12 Sec. 16A. MANAGEMENT OF ASSETS. The trustee may commingle
35-13 for investment purposes the assets of any fund created under this
35-14 Act with any other fund created under this Act or any other trust
35-15 fund administered by the trustee, as long as proportionate
35-16 ownership records are maintained and credited.
35-17 SECTION 47. The Texas Employees Uniform Group Insurance
35-18 Benefits Act (Article 3.50-2, Vernon's Texas Insurance Code) is
35-19 amended by adding Section 16C to read as follows:
35-20 Sec. 16C. EMPLOYEES' HEALTH CARE STABILIZATION TRUST FUND.
35-21 (a) The employees' health care stabilization trust fund is a
35-22 special fund in the treasury outside the general revenue fund.
35-23 (b) The fund is composed of:
35-24 (1) money transferred to the fund at the direction of
35-25 the legislature;
35-26 (2) gifts and grants contributed to the fund; and
36-1 (3) the returns received as interest on, and from
36-2 investment of, money in the fund.
36-3 (c) The trustee shall administer the fund. The trustee may
36-4 manage and invest the money in the fund under the standard of care
36-5 provided by Section 815.307, Government Code. In administering the
36-6 fund, the trustee shall make investments in a manner that preserves
36-7 the purchasing power of the fund's assets.
36-8 (d) Money in the fund may not be spent for any purpose,
36-9 except that the interest and investment returns of the fund may be
36-10 appropriated only for the purpose of stabilizing the cost of state
36-11 and participant contributions for health care coverage under this
36-12 Act by minimizing to the greatest extent possible increases in
36-13 those contributions.
36-14 (e) The fund is exempt from the application of Section
36-15 403.095, Government Code.
36-16 SECTION 48. Subsection (a), Section 18, Texas Employees
36-17 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
36-18 Texas Insurance Code), is amended to read as follows:
36-19 (a) The group benefits advisory committee is composed of 26
36-20 voting members as provided by this section. The office of the
36-21 attorney general, the office of the comptroller, the Railroad
36-22 Commission of Texas, the General Land Office, and the Department of
36-23 Agriculture are entitled to be represented by one member each on
36-24 the committee, who may be appointed by the governing body of the
36-25 state agency or elected by and from the employees of the agency, as
36-26 determined by rule by the governing body of the agency. One
37-1 employee shall be elected from each of the remaining eight largest
37-2 state agencies that are governed by appointed officers by and from
37-3 the employees of those agencies. One nonvoting member shall be the
37-4 executive director of the Employees Retirement System of Texas.
37-5 One member shall be an expert in employee benefit issues from the
37-6 private sector, appointed by the governor. One member shall be an
37-7 expert in employee benefits issues from the private sector,
37-8 appointed by the lieutenant governor. One member shall be a
37-9 retired state employee appointed by the trustee. One member shall
37-10 be a state employee of a state agency eligible for membership in
37-11 the Texas Small State Agency Task Force [other than one of the
37-12 eight largest state agencies], appointed by the trustee. Not more
37-13 than one employee from a particular state agency may serve on the
37-14 committee. Each of the seven largest institutions of higher
37-15 education, as determined by the number of employees on the payroll
37-16 of an institution, shall elect one member of the committee from
37-17 among persons who have each been nominated by a petition signed by
37-18 at least 300 employees. Two members shall be employees of
37-19 institutions of higher education, other than the seven largest
37-20 institutions of higher education, who are appointed by the Texas
37-21 Higher Education Coordinating Board, but not more than one employee
37-22 shall be from any one institution. The members shall elect a
37-23 presiding officer from their membership to serve a one-year term.
37-24 SECTION 49. Subsection (b), Section 19, Texas Employees
37-25 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
37-26 Texas Insurance Code), is amended to read as follows:
38-1 (b) A surviving spouse of an employee or a retiree who is
38-2 entitled to monthly benefits paid by a retirement system named in
38-3 this Act may, following the death of the employee or retiree, elect
38-4 to retain the spouse's authorized coverages and also retain
38-5 authorized coverages for any dependent of the spouse, at the group
38-6 rate for employees, provided such coverage was previously secured
38-7 by the employee or retiree for the spouse or dependent, and the
38-8 spouse directs the applicable retirement system to deduct required
38-9 contributions from the monthly benefits paid the surviving spouse
38-10 by the retirement system. A surviving dependent of a retiree who
38-11 was receiving monthly benefits paid by a retirement system named in
38-12 this Act may, after the death of the retiree and if the retiree
38-13 leaves no surviving spouse, elect to retain any coverage previously
38-14 secured by the retiree, at the group rate for employees, until the
38-15 dependent becomes ineligible for coverage for a reason other than
38-16 the death of the member of the group. A dependent who makes an
38-17 election under this subsection and who is entitled to monthly
38-18 benefits from a retirement system named in this Act based on the
38-19 service of the deceased retiree must direct the applicable
38-20 retirement system to deduct required contributions for the coverage
38-21 from the monthly benefits paid the surviving dependent by the
38-22 retirement system. If funds are specifically appropriated for the
38-23 purpose, the state shall pay the same portion of the cost of the
38-24 required contributions for a deceased retiree's surviving spouse or
38-25 other surviving dependent who elects to retain coverage under this
38-26 subsection as it pays for similar dependent coverage for an
39-1 employee or retiree participating in the program.
39-2 SECTION 50. Subsection (a), Section 403.026, Government
39-3 Code, as added by Chapter 1153, Acts of the 75th Legislature,
39-4 Regular Session, 1997, is amended to read as follows:
39-5 (a) The comptroller shall conduct a study each biennium to
39-6 determine the number and type of fraudulent claims for medical or
39-7 health care benefits submitted:
39-8 (1) under the state Medicaid program; or
39-9 (2) [under group health insurance programs
39-10 administered through the Employees Retirement System of Texas for
39-11 active and retired state employees; or]
39-12 [(3)] by or on behalf of a state employee and
39-13 administered by the attorney general under Chapter 501, Labor Code.
39-14 SECTION 51. Section 609.007, Government Code, is amended by
39-15 adding Subsection (d) to read as follows:
39-16 (d) A contract created under this section need not be in
39-17 writing and may be communicated to the plan administrator
39-18 electronically or by any other means approved by the plan's
39-19 trustees.
39-20 SECTION 52. Section 609.505, Government Code, is amended by
39-21 amending Subsection (a) and adding Subsections (c) and (d) to read
39-22 as follows:
39-23 (a) The board of trustees, in accordance with rules adopted
39-24 under this subchapter, may contract with a [qualified] vendor
39-25 qualified to participate in a deferred compensation plan.
39-26 (c) A vendor or investment product having an ownership or
40-1 other financial interest in the contractor selected by the board of
40-2 trustees to administer a deferred compensation plan is not
40-3 qualified to participate in that plan.
40-4 (d) The board of trustees shall select vendors or investment
40-5 products based on the quality of investment performance, proven
40-6 ability to manage institutional assets, minimum net worth
40-7 requirements, fee structure, compliance with applicable federal and
40-8 state laws, and other criteria established by the board. The board
40-9 of trustees shall determine the minimum and maximum number of
40-10 vendors and investment products that may be offered by a plan at
40-11 any particular time.
40-12 SECTION 53. Section 609.510, Government Code, is amended to
40-13 read as follows:
40-14 Sec. 609.510. EXEMPTION FOR CERTAIN CONTRACTS. A contract
40-15 authorized by Section 609.505 [for TexaSaver] or by Section 609.509
40-16 for either deferred compensation plan is exempt from:
40-17 (1) Subtitle D, Title 10;
40-18 (2) Chapter 463; and
40-19 (3) Chapter 2254.
40-20 SECTION 54. Section 615.001, Government Code, is amended to
40-21 read as follows:
40-22 Sec. 615.001. DEFINITION. In this chapter, "minor child"
40-23 means a child who, on the date of the death of an individual listed
40-24 under Section 615.003, is younger than 18 [21] years of age.
40-25 SECTION 55. Subchapter C, Chapter 2155, Government Code, is
40-26 amended by adding Section 2155.146 to read as follows:
41-1 Sec. 2155.146. CERTAIN PURCHASES BY EMPLOYEES RETIREMENT
41-2 SYSTEM OF TEXAS. (a) The Employees Retirement System of Texas is
41-3 delegated all purchasing functions relating to the purchase of
41-4 goods or services from funds other than general revenue funds for a
41-5 purpose the retirement system determines relates to the fiduciary
41-6 duties of the retirement system.
41-7 (b) The Employees Retirement System of Texas shall acquire
41-8 goods or services by any procurement method approved by the board
41-9 of trustees of the retirement system that provides the best value
41-10 to the retirement system. The retirement system shall consider the
41-11 best value standards enumerated in Section 2155.074, as added by
41-12 Chapter 1206, Acts of the 75th Legislature, Regular Session, 1997.
41-13 (c) The commission shall procure goods or services for the
41-14 Employees Retirement System of Texas at the request of the
41-15 retirement system, and the retirement system may use the services
41-16 of the commission in procuring goods or services.
41-17 SECTION 56. Subsection (b), Section 2171.055, Government
41-18 Code, is amended to read as follows:
41-19 (b) An institution of higher education as defined by Section
41-20 61.003, Education Code, is not required to participate in the
41-21 commission's contracts for travel agency services or other travel
41-22 services purchased from funds other than general revenue funds or
41-23 educational and general funds as defined by Section 51.009,
41-24 Education Code. The Employees Retirement System of Texas is not
41-25 required to participate in the commission's contracts for travel
41-26 agency services or other travel services purchased from funds other
42-1 than general revenue funds.
42-2 SECTION 57. (a) Monthly payments of a retirement or death
42-3 benefit annuity by the Employees Retirement System of Texas under
42-4 Subtitle B, Title 8, Government Code, are increased beginning with
42-5 the first payment of the annuities that becomes due on or after the
42-6 effective date of this section.
42-7 (b) The increase does not apply to annuities payable under
42-8 Section 814.103, Government Code.
42-9 (c) The amount of the monthly increase is computed by
42-10 multiplying the previous monthly benefit by a percentage determined
42-11 in accordance with the following table:
42-12 LATEST RETIREMENT DATE OR,
42-13 IF APPLICABLE, DATE OF DEATH INCREASE
42-14 Before September 1, 1953 49%
42-15 On or after September 1, 1953, but before September 1, 1954 47%
42-16 On or after September 1, 1954, but before September 1, 1955 52%
42-17 On or after September 1, 1955, but before September 1, 1956 45%
42-18 On or after September 1, 1956, but before September 1, 1958 49%
42-19 On or after September 1, 1958, but before September 1, 1959 52%
42-20 On or after September 1, 1959, but before September 1, 1960 47%
42-21 On or after September 1, 1960, but before September 1, 1961 49%
42-22 On or after September 1, 1961, but before September 1, 1962 47%
42-23 On or after September 1, 1962, but before September 1, 1963 45%
42-24 On or after September 1, 1963, but before September 1, 1964 47%
42-25 On or after September 1, 1964, but before September 1, 1965 49%
42-26 On or after September 1, 1965, but before September 1, 1967 52%
43-1 On or after September 1, 1967, but before September 1, 1968 54%
43-2 On or after September 1, 1968, but before September 1, 1970 49%
43-3 On or after September 1, 1970, but before September 1, 1972 54%
43-4 On or after September 1, 1972, but before September 1, 1973 47%
43-5 On or after September 1, 1973, but before September 1, 1974 37%
43-6 On or after September 1, 1974, but before September 1, 1975 35%
43-7 On or after September 1, 1975, but before September 1, 1976 45%
43-8 On or after September 1, 1976, but before September 1, 1977 41%
43-9 On or after September 1, 1977, but before September 1, 1978 49%
43-10 On or after September 1, 1978, but before September 1, 1979 37%
43-11 On or after September 1, 1979, but before September 1, 1981 23%
43-12 On or after September 1, 1981, but before September 1, 1982 20%
43-13 On or after September 1, 1982, but before September 1, 1983 22%
43-14 On or after September 1, 1983, but before September 1, 1984 23%
43-15 On or after September 1, 1984, but before September 1, 1985 20%
43-16 On or after September 1, 1985, but before September 1, 1986 23%
43-17 On or after September 1, 1986, but before September 1, 1987 19%
43-18 On or after September 1, 1987, but before September 1, 1988 20%
43-19 On or after September 1, 1988, but before September 1, 1989 15%
43-20 On or after September 1, 1989, but before September 1, 1990 12%
43-21 On or after September 1, 1990, but before September 1, 1991 9%
43-22 On or after September 1, 1991, but before September 1, 1992 7%
43-23 On or after September 1, 1992, but before September 1, 1993 6%
43-24 On or after September 1, 1993, but before September 1, 1994 12%
43-25 On or after September 1, 1994, but before September 1, 1995 9%
43-26 On or after September 1, 1995, but before September 1, 1996 6%
44-1 On or after September 1, 1996, but before September 1, 1997 3%
44-2 On or after September 1, 1997, but before September 1, 1998 2%
44-3 On or after September 1, 1998, but before September 1, 1999 1%
44-4 SECTION 58. The Employees Retirement System of Texas shall
44-5 make a supplemental payment under Subsection (d), Section 814.603,
44-6 Government Code, in the fiscal year beginning September 1, 2000, if
44-7 the payment is in compliance with Section 811.006, Government Code.
44-8 SECTION 59. The Employees Retirement System of Texas shall
44-9 recompute each annuity being paid under Subtitle E, Title 8,
44-10 Government Code, on December 31, 1999, as if the retirement or
44-11 death on which the annuity is based occurs on that date. Payments
44-12 of an annuity recomputed under this section begin with the first
44-13 payments that become due after December 31, 1999.
44-14 SECTION 60. The change in law made by this Act to Section
44-15 814.1041, Government Code, prevails over any other Act of the 76th
44-16 Legislature, Regular Session, 1999, regardless of the relative
44-17 dates of enactment, that purports to amend Section 814.1041 or
44-18 create a similar provision to allow a temporary retirement option
44-19 for members of the Employees Retirement System of Texas whose
44-20 positions are subject to privatization or a reduction in workforce
44-21 or who are transferred between state agencies, and any amendment to
44-22 Section 814.1041, Government Code, or similar provision in another
44-23 Act of the 76th Legislature, Regular Session, 1999, has no effect.
44-24 SECTION 61. Before October 1, 1999, the Board of Pardons and
44-25 Paroles and the Texas Department of Criminal Justice shall certify
44-26 to the Employees Retirement System of Texas, in the manner
45-1 prescribed by the retirement system, the name of each person
45-2 employed by the board on September 1, 1999, as a custodial officer
45-3 as defined by Section 811.001, Government Code, as amended by this
45-4 Act, and such other information as the system determines is
45-5 necessary for the crediting of service and financing of benefits
45-6 under Subtitle B, Title 8, Government Code.
45-7 SECTION 62. Section 813.405, Government Code, and
45-8 Subsections (b), (c), and (g), Section 5, Texas Employees Uniform
45-9 Group Insurance Benefits Act (Article 3.50-2, Vernon's Texas
45-10 Insurance Code), are repealed.
45-11 SECTION 63. (a) Except as provided by Subsection (b) of
45-12 this section, Subsection (b), Section 814.302, Government Code, as
45-13 amended by this Act, applies only to deaths of contributing members
45-14 of the Employees Retirement System of Texas that occur on or after
45-15 the effective date of this Act.
45-16 (b) The surviving spouse of a contributing member of the
45-17 Employees Retirement System of Texas who died before the effective
45-18 date of this Act and whose account has not been refunded may apply
45-19 for and receive a death benefit annuity under Subsection (b),
45-20 Section 814.302, Government Code, as amended by this Act. The
45-21 effective date of an annuity under this subsection is the last day
45-22 of the month in which the member died. The amount of an annuity
45-23 payable under this subsection will be determined under the plan
45-24 terms in effect in the month in which the member died. The
45-25 retirement system shall make a lump-sum payment of all unpaid
45-26 annuity payments under this subsection at the time the first
46-1 payment of the annuity becomes due on or after the effective date
46-2 of this Act. This subsection expires December 31, 1999.
46-3 SECTION 64. Notwithstanding Section 3A, Texas Employees
46-4 Uniform Group Insurance Benefits Act (Article 3.50-2, Vernon's
46-5 Texas Insurance Code), as amended by this Act, a person who retires
46-6 from the Texas County and District Retirement System or the Texas
46-7 Municipal Retirement System on or after the effective date of this
46-8 Act but before September 1, 2002, is not required to meet the
46-9 requirement of three years of service for a department whose
46-10 employees are authorized to participate in the program provided by
46-11 that Act to continue participation authorized by that section.
46-12 SECTION 65. Section 814.1082, Government Code, as added by
46-13 this Act, applies only to retirements that occur on or after
46-14 January 1, 2000.
46-15 SECTION 66. This Act takes effect September 1, 1999, except
46-16 Sections 42, 43, and 57, which take effect January 1, 2000.
46-17 SECTION 67. The importance of this legislation and the
46-18 crowded condition of the calendars in both houses create an
46-19 emergency and an imperative public necessity that the
46-20 constitutional rule requiring bills to be read on three several
46-21 days in each house be suspended, and this rule is hereby suspended.
_______________________________ _______________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 1130 passed the Senate on
April 21, 1999, by a viva-voce vote; and that the Senate concurred
in House amendment on May 29, 1999, by a viva-voce vote.
_______________________________
Secretary of the Senate
I hereby certify that S.B. No. 1130 passed the House, with
amendment, on May 26, 1999, by a non-record vote.
_______________________________
Chief Clerk of the House
Approved:
_______________________________
Date
_______________________________
Governor