By McClendon                                            H.B. No. 27
         77R928 GJH-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to supplemental annuity payments by the Teacher Retirement
 1-3     System of Texas.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Chapter 824, Government Code, is amended by
 1-6     adding Subchapter J to read as follows:
 1-7                SUBCHAPTER J.  SUPPLEMENTAL ANNUITY PAYMENTS
 1-8           Sec. 824.821.  SUPPLEMENTAL ANNUITY PAYMENTS AUTHORIZED.  (a)
 1-9     The board of trustees may authorize the retirement system to make a
1-10     supplemental payment in a particular fiscal year of annuities
1-11     payable by the system that are based on service retirements,
1-12     disability retirements, or deaths and are not excluded by
1-13     Subsection (c).  A supplemental payment is in addition to the
1-14     regular monthly annuity payment.
1-15           (b)  The amount of a supplemental payment is equal to 10
1-16     percent of the amount of a regular monthly annuity payment
1-17     multiplied by the number of fiscal years in which the annuity has
1-18     been paid.  For the purpose of this section, the board of trustees
1-19     may exclude any of the most recent two fiscal years of annuity
1-20     payments.  The amount of a supplemental payment may not exceed 350
1-21     percent of the amount of a regular monthly annuity payment.
1-22     Supplemental payments under this section must comply with Section
1-23     821.006.
1-24           (c)  A supplemental payment may not apply to annuities
 2-1     payable under Section 824.304(a), 824.404, or 824.501.
 2-2           Sec. 824.822.  SOURCE OF SUPPLEMENTAL ANNUITY PAYMENTS. The
 2-3     retirement system shall pay a supplemental annuity payment
 2-4     authorized under Section 824.821 from the retired reserve account
 2-5     and may transfer to that account from the state contribution
 2-6     account any portion of the amount that exceeds the amount in the
 2-7     retired reserve account available to finance the supplemental
 2-8     payment and that is actuarially determined to be necessary to
 2-9     finance the supplemental payment.
2-10           Sec. 824.823.  RULES FOR SUPPLEMENTAL ANNUITY PAYMENTS.   The
2-11     board of trustees may adopt rules to implement supplemental annuity
2-12     payments, including rules that govern the timing of a supplemental
2-13     payment.
2-14           SECTION 2.  The board of trustees of the Teacher Retirement
2-15     System of Texas shall authorize a supplemental payment under
2-16     Subchapter J, Chapter  824, Government Code, as added by this Act,
2-17     to be made in the fiscal years beginning September 1, 2001, and
2-18     September 1, 2002, if the conditions required by Section
2-19     824.821(b), Government Code, as added by this Act, are met.
2-20           SECTION 3.  This Act takes effect September 1, 2001.