HBA-TBM C.S.H.B. 3407 77(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.H.B. 3407
By: King, Tracy
Pensions & Investments
4/16/2001
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Currently, a public school employee who is a member of the Teacher
Retirement System of Texas (TRS) is allowed to establish service credit in
TRS for military service, out-of-state service, developmental leave,
service previously waived, and work experience in a career or technological
field.  Teachers are not authorized to establish service credit that is
required by a court order due to wrongful termination by a school district.
C.S.H.B. 3407 authorizes a teacher to establish court-ordered service
credit in TRS.   

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

C.S.H.B. 3407 amends the Government Code to set forth provisions regarding
court-ordered credit in the Teacher Retirement System of Texas (TRS).  The
bill defines a "court order" as a court order that finds that a school
district wrongfully terminated a member, requires the school district to
reemploy the member, and requires the establishment of credit in TRS for
all or part of the service credit the member would have otherwise
established during the period between the date of the wrongful termination
and the date of reemployment.   

The bill authorizes a member to establish equivalent membership service
credit for credit required by a court order. The bill authorizes a member
to establish credit by depositing with TRS, for each year of service, the
actuarial present value, at the time of deposit, of the additional standard
retirement benefits that would be attributable to the service credit as
determined by TRS.  After a member makes the required deposits, TRS is
required to grant the member one year of equivalent membership service
credit for each year of credit required under the court order.  The bill
prohibits TRS from using service credit granted by order in computing a
member's annual average compensation.   

The bill requires all court-ordered credit to be computed on a September 1
through August 31 school year.  
EFFECTIVE DATE

September 1, 2001.  The bill applies to court-ordered credit regardless of
whether the proceeding occurred before, on, or after that date. 

COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.H.B. 3407 differs from the original by removing the provisions relating
to the 10 year service credit eligibility requirement, the fee for
establishing credit, and the prohibition against the establishment of more
than two years of service credit.  The substitute modifies the procedure by
which a member may establish credit.  The substitute also provides that
this bill applies to court-ordered credit regardless of whether the
proceeding occurred before, on, or after the effective date of the Act.