1-1 By: Shapiro S.B. No. 1226
1-2 (In the Senate - Filed March 11, 1999; March 11, 1999, read
1-3 first time and referred to Committee on State Affairs;
1-4 April 20, 1999, reported adversely, with favorable Committee
1-5 Substitute by the following vote: Yeas 9, Nays 0; April 20, 1999,
1-6 sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 1226 By: Shapiro
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to the deferred retirement option plan in the Teacher
1-11 Retirement System of Texas.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Section 824.802, Government Code, is amended to
1-14 read as follows:
1-15 Sec. 824.802. Participation in Plan. (a) A contributing
1-16 member who is eligible under Section 824.202 to retire and receive
1-17 a standard service retirement annuity that is not reduced for
1-18 retirement at an early age and who has at least 25 years of service
1-19 credit in the retirement system may, if the member remains an
1-20 employee, elect to participate in the deferred retirement option
1-21 plan. Notwithstanding Chapter 805, a member may transfer to the
1-22 retirement system service credit established in the Employees
1-23 Retirement System of Texas. Service credit transferred under this
1-24 subsection may be used to establish eligibility for participation
1-25 in and the amount of benefits under the plan.
1-26 (b) An election to participate in the plan must be on a form
1-27 prescribed by and filed with the retirement system. An election
1-28 [may be made only once and] must state the period that the member
1-29 wishes to participate in the plan. The period must be a minimum of
1-30 12 consecutive months and be in 12-month increments. The maximum
1-31 period a member may participate in the plan is 60 consecutive
1-32 months. [An election under this section is irrevocable after
1-33 filing.] The filing of an election under this section is not
1-34 considered for any purpose an application for retirement, and a
1-35 person is not considered a retiree for any purpose because of the
1-36 filing.
1-37 (c) A contributing member may revoke an election to
1-38 participate in the plan on a form prescribed by and filed with the
1-39 retirement system. A revocation may be made only once. On
1-40 revocation, the retirement system shall transfer all contributions
1-41 and interest in the deferred retirement option account as a result
1-42 of the member's election to the appropriate system accounts.
1-43 (d) The effective date of a member's participation or
1-44 revocation of participation in the plan is the first day of the
1-45 month after the month in which an election or revocation is
1-46 received and approved by the retirement system. The retirement
1-47 system shall approve the election or revocation filed by a member
1-48 who is eligible to make the election or revocation.
1-49 SECTION 2. Subsection (b), Section 824.803, Government Code,
1-50 is amended to read as follows:
1-51 (b) For purposes of the plan, the amount of service credit
1-52 used to compute [computation of] the service retirement annuity of
1-53 a member participating in the plan is determined as of the
1-54 effective date of participation in the plan. The amount of the
1-55 annuity is computed on the effective date of termination of
1-56 participation according to the formula used to compute annuities
1-57 that is in effect at that time. A participating member is not
1-58 eligible to receive a postretirement increase made applicable to
1-59 annuitants during the member's participation in the plan.
1-60 SECTION 3. Subsections (a) and (c), Section 824.804,
1-61 Government Code, are amended to read as follows:
1-62 (a) On the effective date of a member's participation in the
1-63 plan, the retirement system shall make the transfers required by
1-64 Section 825.309 to the retired reserve account as if the member had
2-1 retired on that date. The retirement system shall transfer
2-2 monthly, during the period of the member's participation in the
2-3 plan, from the retired reserve account to an account for the member
2-4 in the deferred retirement option account an amount equal to 61
2-5 [79] percent of the amount the member would receive [have received]
2-6 that month under a standard service retirement annuity if the
2-7 member had retired the preceding month [on the effective date of
2-8 plan participation].
2-9 (c) If a member dies during participation in the plan or
2-10 after participation but before retirement, the decedent's
2-11 designated beneficiary is entitled to the accumulated amount in the
2-12 decedent's account in the deferred retirement option account,
2-13 including creditable interest. The beneficiary is also entitled to
2-14 a death benefit based on age, compensation, and years of service
2-15 [on the effective date of participation in the plan and on age] on
2-16 the date of death.
2-17 SECTION 4. This Act takes effect September 1, 1999.
2-18 SECTION 5. The importance of this legislation and the
2-19 crowded condition of the calendars in both houses create an
2-20 emergency and an imperative public necessity that the
2-21 constitutional rule requiring bills to be read on three several
2-22 days in each house be suspended, and this rule is hereby suspended.
2-23 * * * * *