SRC-JBJ S.B. 372 77(R)BILL ANALYSIS Senate Research CenterS.B. 372 By: Barrientos State Affairs 6/19/2001 Enrolled DIGEST AND PURPOSE The Texas Proportionate Retirement System (system) was created in 1981 in recognition of the increased mobility of public employees transferring among governmental entities. S.B. 372 amends provisions relating to the system to allow employees of a participating retirement system to re-establish service credit that was previously canceled in certain other participating systems without returning to the system from which the employee withdrew service credit. RULEMAKING AUTHORITY This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Chapter 803C, Government Code, by adding Section 803.203, as follows: Sec. 803.203. REESTABLISHMENT OF SERVICE CREDIT BY FORMER MEMBER. (a) Authorizes a person who is a member of a retirement system participating in the program provided by this chapter, except as provided by Subsection (g), to reestablish service credit, including prior service credit if applicable, previously canceled in another retirement system that is participating in the program provided by this chapter if the person meets certain criteria. (b) Authorizes a person to apply to reestablish service credit under this section by filing an application with the retirement system in which the service was originally credited and a certification that the applicant is currently a member of the certifying system. (c) Requires the retirement system in which the service credit was originally credited, except as provided by Subsection (f), to grant the service credit after receiving an application and certification required by Subsection (b) and other certain items under certain conditions. (d) Authorizes a subdivision participating in the Texas County and District Retirement System under Chapter 844H, or a municipality participating in the Texas Municipal Retirement System to make a one-time election to authorize the reestablishment of service credit under this section by payment by an applicant of a contribution in the amount provided by Section 843.003 or 853.003, as applicable, for reestablishment of service credit generally in the particular system. Provides that if a subdivision or municipality makes election under this subsection, the applicant has the choice of reestablishing service credit under Subsection (c)(2), (c)(3), if applicable, or this subsection. (e) Authorizes service credit reestablished in the Texas County and District Retirement System or the Texas Municipal Retirement System under Subsection (c)(2) to be used only to meet eligibility requirements for benefits. Provides that service credit reestablished in either system under Subsection (c)(3) or (d) has the same value as service credit performed for the particular subdivision or municipality at the time of deposit. Provides that the credit is creditable to the member's and employer's accounts in each subdivision or municipality for which the service was performed. (f) Requires a person, to reestablish service credit in a public retirement system for municipal employees that has elected under Section 803.101(f) to participate in the program provided by this chapter, to pay the actuarial present value, as determined by the appropriate system, of the additional standard service retirement benefits that would be attributable to the credit. Requires a person who is a member only of a system that has made an election under Section 803.101(f) to pay the actuarial present value, as determined by the appropriate system, of the additional standard service retirement benefits that would be attributable to the service credit to be reestablished in any other public retirement system participating in the program provided by this chapter. (g) Prohibits service credit from being reestablished under this section under certain conditions. SECTION 2. Amends Chapter 833B, Government Code, by adding Section 833.106, as follows: Sec. 833.106. CREDIT FOR YEAR IN WHICH ELIGIBLE FOR OFFICE. (a) Authorizes a member who has not retired to establish service credit in the retirement system under certain conditions. (b) Authorizes a member to establish service credit under this section by depositing with the retirement system a contribution computed for each month of credit claimed at the rate of six percent of the member's current monthly salary, plus, if the member does not establish credit before the first anniversary of the date of first eligibility, interest computed on the basis of the state fiscal year at an annual rate of ten percent from the date of first eligibility to the date of deposit. SECTION 3. Amends Section 834.102(b), Government Code, to require the retirement system to increase by ten percent of the amount of the applicable state salary under Subsections (a) or (d) the annuity of a member who on the effective date of retirement meets certain criteria. SECTION 4. Amends Section 835.101, Government Code, by amending Subsection (a) and adding Subsection (c), to provide a certain exception. Provides that a member who accrues 20 years of service credit in the retirement system ceases making contributions under this section. SECTION 5. Amends Chapter 838B, Government Code, by adding Section 838.106, as follows: Sec. 838.106. CREDIT FOR YEAR IN WHICH ELIGIBLE FOR OFFICE. (a) Authorizes a contributing member to establish service credit in the retirement system for any calendar year during which the member meets certain criteria. (b) Authorizes a member to establish service credit under this section by depositing with the retirement system a certain calculated contribution for each month of credit claimed. SECTION 6. Amends Section 839.102, Government Code, to make a conforming change. SECTION 7. Effective date: January 1, 2002.