HBA-DMH, CCH H.B. 783 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 783 By: Tillery Pensions and Investments 5/1/2001 Introduced BACKGROUND AND PURPOSE Currently, the confidentiality of Teacher Retirement System of Texas (TRS) members' records may be ambiguous. In addition, it is believed that changes to provisions governing annuity payments and premium taxes may better serve the members of TRS. House Bill 783 increases annuity payments for certain individuals, specifies that optional insurance coverage is not subject to a premium tax, and clarifies the confidentiality of TRS members' records. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the board of trustees of the Teacher Retirement System of Texas in SECTION 7 (Article 6228a-5, V.T.C.S.) of this bill. ANALYSIS House Bill 783 amends the Government and Insurance codes and Vernon's Texas Civil Statutes relating to the administration of the Teacher Retirement System of Texas (TRS). The bill increases from 2.2 to 2.3 percent the multiplier for each year of service credit in TRS that is utilized to compute members' standard service retirement annuity and the standard service retirement annuity or the annual death benefit annuity for those who were classroom teachers or full-time librarians immediately before retirement or at the time of death (SECTION 2). Employing districts that fail to remit all required member and employer deposits before the 4th day, rather than the 11th day, after the last day of a month are required to pay the deposits and interest on the unpaid or undocumented amounts at a specified rate (SECTIONS 3 and 8). The bill modifies the provisions relating to the release, disclosure, and confidentiality of records of certain individuals (SECTION 5). The bill requires each educational institution to offer investments that are created and approved by the board of trustees of TRS. The bill requires, to the greatest degree possible, employers of employees who participate in the investment program offered to require that contributions to investments be directly deposited into investment accounts by automatic payroll deductions. The board of trustees of TRS is authorized to adopt rules to administer these provisions (SECTION 7). The bill provides that a premium or contribution on a policy, insurance contract, or other authorized agreement is not subject to any state tax, regulatory fee, or surcharge (SECTIONS 9 and 10). The bill prohibits TRS from withholding monthly benefit payments for certain retirees (SECTION 6). The bill sets forth the procedure by which monthly payments of death or retirement benefit annuities are paid by TRS beginning with the payment due at the end of September 2001 and provides for the computation method of monthly payments for certain retirees. For the purpose of computing the monthly payments of annuities for retirees who retired on or before August 31, 2000, the amount of the monthly payment is equal to the amount of the last monthly payment made before September 1, 2001 multiplied by 1.06. After making this computation, TRS is required to increase the monthly payment of each annuity made by TRS by 4.5 percent beginning on September 1, 2001. The increase does not apply to payments made for disability retirement benefits if a member has less than 10 years of service credit in TRS, or to specified survivor benefits (SECTION 11). EFFECTIVE DATE September 1, 2001.