By Armbrister S.B. No. 523
77R4718 GJH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to participation and credit in, contributions to, and
1-3 benefits and administration of the Texas County and District
1-4 Retirement System.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 841.001, Government Code, is amended to
1-7 read as follows:
1-8 Sec. 841.001. DEFINITIONS. In this subtitle:
1-9 (1) "Actuarial equivalent" means a benefit that, at
1-10 the time it is begun [entered upon], has the same present value as
1-11 the benefit it replaces, based on seven percent annual interest and
1-12 the mortality table published by the Conference of Actuaries in
1-13 Public Practice and known as the UP-1984 table with an age setback
1-14 of five years for retired or disabled annuitants and an age setback
1-15 of 10 years for beneficiaries, with a 30-percent reserve refund
1-16 assumption for the standard benefit.
1-17 (2) "Accumulated contributions" means the
1-18 contributions, other member deposits, and interest credited to a
1-19 member's individual account in the employees saving fund. ["Annual
1-20 compensation" means the compensation that is paid to an employee of
1-21 a participating subdivision by the subdivision that does not exceed
1-22 the rate of compensation fixed by the subdivision governing body as
1-23 the maximum compensation for a year on which contributions by the
1-24 employee to the retirement system may be based.]
2-1 (3) "Annuity" means an amount of money payable in
2-2 equal monthly installments at the end of each month for a period
2-3 determined under this subtitle.
2-4 (4) "Beneficiary" means an individual or entity
2-5 designated by a member or annuitant or by statute to receive a
2-6 benefit payable under this subtitle because of the death of a
2-7 member or an annuitant. The term does not include an "alternate
2-8 payee" as defined by Section 804.001.
2-9 (5) "Board of trustees" means the persons appointed
2-10 under this subtitle to administer the retirement system.
2-11 (6) [(5)] "Compensation" means the payments on which
2-12 contributions by an employee to the retirement system are based
2-13 that do not exceed $150,000 in a calendar year, indexed in the same
2-14 manner as is provided by Section 401(a)(17) of the Internal Revenue
2-15 Code of 1986 (26 U.S.C. Section 417) and that are made to an
2-16 employee of a participating subdivision by the subdivision for
2-17 service, including nonmonetary compensation, the value of which is
2-18 determined by the governing body of the subdivision. The term does
2-19 not include workers' compensation benefits received by a member
2-20 under Section 504.011, Labor Code.
2-21 (7) "Credited service" means the number of months of
2-22 prior and current service ascribed to a member in the retirement
2-23 system or included in a prior service certificate in effect for the
2-24 member.
2-25 (8) [(6)] "Employee" means a person, other than a
2-26 temporary employee, who is certified by a subdivision as being
2-27 employed in, or elected or appointed to, a position or office in
3-1 the subdivision that normally requires services from the person for
3-2 not less than 900 hours a year and for which the person is
3-3 compensated by the subdivision. The term includes a person employed
3-4 on a probationary basis except as provided by Section 842.107
3-5 [842.107(c)].
3-6 (9) [(7)] "Governing body" means the commissioners
3-7 court of a county or, in any other subdivision, the body that is
3-8 authorized to raise and expend revenue.
3-9 (10) [(8)] "Initial deposit rate" means the percentage
3-10 of the annual compensation of an employee of a participating
3-11 subdivision that is required by the subdivision on the effective
3-12 date of subdivision participation in the retirement system as the
3-13 rate for employee contributions to the retirement system.
3-14 (11) [(9)] "Local pension system" means a public
3-15 retirement benefit program of less than statewide scope.
3-16 (12) [(10)] "Retirement" means the withdrawal from
3-17 service with a retirement benefit granted under this subtitle.
3-18 (13) "Retirement annuity" means the service,
3-19 disability, or survivor benefit paid under this subtitle in the
3-20 form of an annuity.
3-21 (14) [(11)] "Retirement system" means the Texas County
3-22 and District Retirement System.
3-23 (15) [(12)] "Service" means the time a person is an
3-24 employee.
3-25 (16) "Service credit" means the monetary credits
3-26 allowed a member for service for a participating subdivision.
3-27 [(13) "Credited service" means the number of months of
4-1 prior and current service ascribed to a member in the retirement
4-2 system or included in a prior service certificate in effect for the
4-3 member.]
4-4 (17) [(14)] "Subdivision" means a county, a political
4-5 unit that consists of all of the geographical area of one county or
4-6 of all or part of more than one county, a political unit of a
4-7 county that has taxing authority, an authority created by the state
4-8 [State of Texas] to conduct redevelopment activities on or related
4-9 to closed military installations of the United States, a crime
4-10 control and prevention district, the Texas Association of Counties,
4-11 the Texas County and District Retirement System, or a city and
4-12 county that jointly operate a city-county hospital under Subchapter
4-13 B, Chapter 265, Health and Safety Code, but does not include an
4-14 incorporated city or town, a school district, or a junior college
4-15 district.
4-16 (18) "Supplemental death benefit program" means the
4-17 optional death benefit program established under Subchapter F,
4-18 Chapter 844.
4-19 (19) [(15)] "Temporary employee" means a person who is
4-20 scheduled to hold a position for less than six months and only:
4-21 (A) until another person can be hired;
4-22 (B) for the duration of a project scheduled to
4-23 end less than six months after the date of hiring;
4-24 (C) until a specific date less than six months
4-25 after the date of hiring; or
4-26 (D) until a volume of work is completed that is
4-27 estimated to be completed in less than six months after the date of
5-1 hiring.
5-2 (20) [(16)] "Supplemental death benefit program" means
5-3 the voluntary, employer-funded optional death benefits program
5-4 under Subchapter F, Chapter 844. The program constitutes
5-5 "group-term life insurance purchased for employees" as described by
5-6 Section 79 of the Internal Revenue Code of 1986.
5-7 (21) [(17)] "Vested member" means a member who may
5-8 withdraw from employment with all participating subdivisions, leave
5-9 the member's accumulated contributions on deposit with the
5-10 retirement system, and, on meeting the age and length-of-service
5-11 requirements for service retirement, file an application for
5-12 retirement and begin to receive a service retirement annuity
5-13 [benefit].
5-14 SECTION 2. Section 841.008, Government Code, is amended to
5-15 read as follows:
5-16 Sec. 841.008. APPLICATIONS BY, AND PAYMENTS TO, PERSONS
5-17 OTHER THAN MEMBERS, BENEFICIARIES, AND ANNUITANTS [THE MEMBER]. (a)
5-18 The board of trustees may accept an application for any benefit
5-19 under this subtitle that is signed on behalf of a person entitled
5-20 to the benefit [the member] by:
5-21 (1) an [a duly] appointed guardian of the person and
5-22 estate of the person [member]; or
5-23 (2) an attorney in fact [a person] authorized to act
5-24 on behalf of the person [member] by a written power of attorney
5-25 that provides that the power is not revoked by disability of the
5-26 person [member], except that an attorney in fact who is not the
5-27 person's spouse may not select a benefit in which the attorney in
6-1 fact is a named beneficiary, unless the attorney in fact designates
6-2 as the person's beneficiary each individual who would be entitled
6-3 to the entire benefit if the person had died intestate [is the
6-4 spouse of the member].
6-5 (b) If it is made to appear to the director by affidavit of
6-6 a [duly] licensed physician that a person entitled to a benefit
6-7 [member] is not mentally capable of managing the person's
6-8 [member's] own affairs, and if it is further established to the
6-9 satisfaction of the director that the estate of the person [member]
6-10 is insufficient to justify the expense of establishing a
6-11 guardianship or continuing a guardianship after letters of
6-12 guardianship have expired, the director may make payment of any
6-13 annuity or other benefit:
6-14 (1) to the spouse of the person [member], as trustee
6-15 for the person [member]; or
6-16 (2) [if there is no spouse,] to an individual or
6-17 entity [a person] actually providing for the needs of and caring
6-18 for the person [member], as trustee for the person until current
6-19 letters of guardianship are filed with the retirement system
6-20 [member].
6-21 (c) If requested by the person entitled to the benefit or
6-22 the guardian, attorney in fact, or trustee of the person, the
6-23 director may, if the director determines that it is in the best
6-24 interest of the person entitled to the benefit, make payments
6-25 directly to the trustee of:
6-26 (1) a trust described by Section 867, Texas Probate
6-27 Code, that has been created for the management of guardianship
7-1 funds for the benefit of the person; or
7-2 (2) a trust described by 42 U.S.C. Section
7-3 1396p(d)(4)(A), (B), or (C) that has been established to qualify
7-4 the person for benefits or other assistance under a state or
7-5 federal program or to supplement the benefits or other assistance
7-6 provided under the program.
7-7 (d) The director may require proof of [such] facts used to
7-8 establish a right under this section by evidence the director
7-9 determines is satisfactory [to the director].
7-10 SECTION 3. Section 841.010, Government Code, is amended to
7-11 read as follows:
7-12 Sec. 841.010. DISTRIBUTION REQUIREMENTS. (a)
7-13 Notwithstanding any other provision of this subtitle, all
7-14 distributions under this subtitle must be determined and made in
7-15 accordance with Section 401(a)(9) of the Internal Revenue Code of
7-16 1986 (26 U.S.C. Section 401) and the regulations adopted under that
7-17 provision, including the minimum incidental death benefit
7-18 distribution requirement of Section 401(a)(9)(G) of that code. The
7-19 board of trustees may adopt rules relating to the selection,
7-20 payment, and distribution of benefits to ensure compliance with
7-21 federal statutes and regulations.
7-22 (b) The entire vested interest of a participant must be
7-23 distributed or begin to be distributed not later than April 1
7-24 following the later of the year in which the participant attains
7-25 age 70-1/2 or the year in which the participant separates from
7-26 service with all participating subdivisions. If the participant
7-27 dies after distribution of the participant's interest has begun,
8-1 the remaining portion of the interest will continue to be
8-2 distributed at least as rapidly as the method of distribution being
8-3 used before the participant's death. If the participant dies before
8-4 distribution of the participant's interest begins, distribution of
8-5 the participant's entire interest must be made in a manner
8-6 complying with Section 401(a)(9)(B) of the code.
8-7 SECTION 4. Section 841.101, Government Code, is amended by
8-8 adding a new Subsection (c) and redesignating current Subsection
8-9 (c) as Subsection (d) to read as follows:
8-10 (c) A person commits an offense if the person knowingly
8-11 fails to return money received from the retirement system to which
8-12 the person is not entitled.
8-13 (d) An offense under this section is a misdemeanor
8-14 punishable by a fine of not less than $100 nor more than $1,000, by
8-15 confinement in jail for not less than 30 days nor more than one
8-16 year, or both.
8-17 SECTION 5. Section 842.002, Government Code, is amended to
8-18 read as follows:
8-19 Sec. 842.002. RULES FOR PARTICIPATING SUBDIVISIONS. The
8-20 board of trustees may adopt rules concerning:
8-21 (1) notices, information, and reports the board of
8-22 trustees requires from a subdivision that elects to participate in
8-23 the retirement system; [and]
8-24 (2) the time that a subdivision that elects to
8-25 participate in the retirement system may begin participation; and
8-26 (3) the powers and duties of a participating
8-27 subdivision to adopt orders or resolutions, make elections, and
9-1 otherwise exercise decision-making authority concerning the rights
9-2 and benefits of the members and annuitants under a plan adopted or
9-3 assumed by the subdivision.
9-4 SECTION 6. Sections 842.004(a) and (d), Government Code, are
9-5 amended to read as follows:
9-6 (a) A [If a] subdivision [is] participating in the
9-7 retirement system [on a full salary basis, the subdivision] may
9-8 elect to participate in the supplemental death benefits fund.
9-9 (d) A subdivision that elects to participate in the fund
9-10 [after the operative date of the fund] may begin participation on
9-11 the first day of any month after the month in which the subdivision
9-12 gives notice of its election to the board of trustees.
9-13 SECTION 7. Section 842.104, Government Code, is amended by
9-14 amending Subsection (a) and adding Subsection (e) to read as
9-15 follows:
9-16 (a) If a county elects to participate in the retirement
9-17 system, the commissioners court of the county may elect to deny
9-18 membership to the employees of a county hospital governed by
9-19 Chapter 263, Health and Safety Code [5, Title 71, Revised
9-20 Statutes].
9-21 (e) The commissioners court is the governing body of a
9-22 county hospital for the purposes of this subtitle.
9-23 SECTION 8. Sections 842.106, 842.107, 842.108, 842.109,
9-24 842.110, and 842.111, Government Code, are amended to read as
9-25 follows:
9-26 Sec. 842.106. MULTIPLE RETIREMENT SYSTEM MEMBERSHIP. (a) A
9-27 [Except as provided by this section, a] person who is an employee
10-1 eligible for membership and [is] eligible to receive credit in this
10-2 retirement system for service performed for a participating
10-3 subdivision is not eligible for credit for that service in another
10-4 public [pension fund or] retirement system described by Section
10-5 801.001 that is at least partly supported by the subdivision at
10-6 public expense. It is the responsibility of the subdivision to
10-7 enforce this provision.
10-8 (b) A person may simultaneously be a member of this
10-9 retirement system and another state or local retirement system
10-10 authorized under Section 67, Article XVI, Texas Constitution.
10-11 However, a person may receive a benefit from this system only to
10-12 the extent that the amount of the benefit is computed solely on the
10-13 member's compensation and accumulated contributions in the system.
10-14 Service credited by another retirement system may not be used to
10-15 determine eligibility for a benefit in this retirement system
10-16 except as provided by Chapter 803[, and receive credit for service
10-17 performed during the same period in the retirement system, the
10-18 federal program providing old age and survivors insurance, the
10-19 Employees Retirement System of Texas if the service is performed by
10-20 a prosecuting attorney, and either the Judicial Retirement System
10-21 of Texas Plan One or the Judicial Retirement System of Texas Plan
10-22 Two].
10-23 [(c) In this section, "prosecuting attorney" means a person
10-24 who holds the office of district attorney, criminal district
10-25 attorney, or county attorney performing the duties of a district
10-26 attorney and who is compensated by the state in an amount set by
10-27 appropriation.]
11-1 Sec. 842.107. EXCEPTION TO GENERAL MEMBERSHIP REQUIREMENT.
11-2 [(a) If on the date a subdivision's participation in the
11-3 retirement system becomes effective a person has a basis of
11-4 employment with the subdivision that would be violated by a
11-5 membership requirement of this subchapter, the person may elect not
11-6 to become a member of the retirement system.]
11-7 [(b) If a person qualified to make an election under this
11-8 section has been notified that the subdivision will begin
11-9 participation in the retirement system, the person is considered to
11-10 have elected membership in the retirement system unless before the
11-11 date the subdivision's participation becomes effective the person
11-12 files with the governing body of the subdivision written notice of
11-13 an election not to become a member.]
11-14 [(c)] A subdivision that was participating in the retirement
11-15 system before January 1, 1987, and that had in effect before that
11-16 date and continues to have a policy of hiring new personnel on a
11-17 probationary basis for a specified period may exclude new personnel
11-18 from membership during the probationary period but may not, for
11-19 purposes of retirement system membership, increase the length of
11-20 the probationary period beyond the length of the period in effect
11-21 on January 1, 1987. The subdivision may reduce or eliminate the
11-22 period.
11-23 Sec. 842.108. WITHDRAWAL OF ACCUMULATED CONTRIBUTIONS. (a)
11-24 A person, or the beneficiary of a person, whose membership
11-25 terminated as a result of absence from service may submit an
11-26 application to withdraw all of the person's accumulated
11-27 contributions [who is not an employee of any participating
12-1 subdivision and who has not retired may, by written application,
12-2 withdraw from membership in the retirement system, and the person's
12-3 account will be closed and the person will be paid:]
12-4 [(1) the accumulated contributions in the member's
12-5 individual account in the employees saving fund; plus]
12-6 [(2) interest computed from the beginning of the
12-7 calendar year of withdrawal through the end of the month before the
12-8 month in which withdrawal occurs on the balance in the member's
12-9 individual account in the employees saving fund on January 1 of the
12-10 year of withdrawal].
12-11 (b) A member who has separated from employment with a
12-12 participating subdivision may submit an application to withdraw the
12-13 member's accumulated contributions attributable to service with
12-14 that subdivision. A withdrawal cancels the person's credited
12-15 service and service credit attributable to service with that
12-16 subdivision on the date the retirement system makes payment of any
12-17 portion of the member's accumulated contributions. Credited service
12-18 that has been canceled may not be used to determine eligibility for
12-19 a later retirement unless it is reestablished under Section
12-20 843.003.
12-21 (c) Interest is computed on the balance in the member's
12-22 individual account in the employees saving fund on January 1 of the
12-23 year of withdrawal through the month before the month in which the
12-24 withdrawal occurs for a person described by Subsection (b) and on
12-25 January l of the year of membership termination through the month
12-26 before the month in which the membership terminates for a person
12-27 described by Subsection (a) whose membership terminates after
13-1 December 31, 1999.
13-2 (d) If a person eligible to receive [to whom] a withdrawal
13-3 [would be paid] under this section or Section 844.401 elects to
13-4 have all or a portion of the accumulated contributions paid
13-5 directly to an eligible retirement plan and specifies the [eligible
13-6 retirement] plan to which the contributions are to be paid on forms
13-7 approved [for that purpose] by the board of trustees, the
13-8 retirement system shall make the payment in the form of a direct
13-9 trustee-to-trustee transfer but is under no obligation to determine
13-10 whether the other plan in fact is an eligible retirement plan for
13-11 that purpose.
13-12 Sec. 842.109. TERMINATION OF MEMBERSHIP. (a) A person
13-13 terminates membership in the retirement system by:
13-14 (1) death;
13-15 (2) retirement from all participating subdivisions
13-16 with which the person has service credit;
13-17 (3) withdrawal of all of the person's accumulated
13-18 contributions [while absent from service]; or
13-19 (4) absence from service for five consecutive years
13-20 before accumulating four or more years of credited service.
13-21 (b) A person's membership in the retirement system may not
13-22 extend beyond March 31 of the year following the later of the year
13-23 in which the person attains age 70-1/2 or the year in which the
13-24 person is no longer an employee of any participating subdivision.
13-25 (c) A member of the retirement system who [is not absent
13-26 from service and continues to accumulate membership credited
13-27 service if the person] leaves employment with a participating
14-1 subdivision to perform and does perform qualified military service
14-2 in the uniformed services, as that term is defined in the Uniformed
14-3 Services Employment and Reemployment Rights Act of 1994 (38 U.S.C.
14-4 Section 4301 et seq.), that meets the requirements of that Act is
14-5 not absent from service and continues to accumulate credited
14-6 service with that subdivision if:
14-7 (1) the person applies for reemployment with the same
14-8 subdivision not later than the 90th day after the date the person
14-9 is discharged from military service under honorable conditions or
14-10 released from hospitalization continuing after being discharged
14-11 under honorable conditions for a period of not more than two years;
14-12 and
14-13 (2) the person is reemployed by the same participating
14-14 subdivision.
14-15 (d) [(c)] On any termination of membership in the retirement
14-16 system, a person forfeits all credited service established in the
14-17 retirement system.
14-18 Sec. 842.110. RESUMPTION OF SERVICE WITH SAME EMPLOYER BY
14-19 RETIREE. (a) In this section, "reemploying subdivision" is a
14-20 subdivision for which a person previously has performed creditable
14-21 service and is receiving or would receive a retirement annuity
14-22 except for this section.
14-23 (b) A person who has retired with a service retirement
14-24 annuity [benefit] under this subtitle shall, if the person later
14-25 becomes an employee of a reemploying subdivision, become a member
14-26 of the system on the date of reemployment, but credits and benefits
14-27 payable [allowable] to the person under this subtitle are limited
15-1 as provided by this section.
15-2 (c) [(b)] The retirement system shall [discontinue and]
15-3 suspend payments of each service retirement annuity allowed because
15-4 of the person's previous service with a reemploying subdivision,
15-5 beginning with the month the retirement system determines that the
15-6 person has resumed employment with the reemploying subdivision.
15-7 After the determination, the retirement system may not make
15-8 payments of the annuity for any month during which the person
15-9 remains an employee of the reemploying subdivision. The retirement
15-10 system shall transfer annuity payments that become due and would be
15-11 payable to the retiree except for the suspension to a
15-12 non-interest-bearing account in the endowment fund. The suspension
15-13 of a benefit under this section does not suspend payment of a
15-14 benefit to an alternate payee under a qualified domestic relations
15-15 order.
15-16 (d) The retirement system shall establish an individual
15-17 account for the member in the employees saving fund for accumulated
15-18 contributions credited after reemployment with the subdivision.
15-19 After terminating employment with the reemploying subdivision, a
15-20 member may elect either an additional standard or optional service
15-21 retirement annuity based on the additional service with the
15-22 reemploying subdivision or a refund of the member's accumulated
15-23 contributions since reemployment. [(c) Member contributions under
15-24 Section 845.403 shall be made on all compensation paid to the
15-25 employee by the subdivision at the same rate as required of other
15-26 employees of the subdivision. The contributions shall be deposited
15-27 by the retirement system on receipt in an individual account for
16-1 the member in the employees saving fund and shall be credited with
16-2 interest annually at the same rate and manner as are the accounts
16-3 of other members. The compensation paid to the employee by the
16-4 subdivision shall be included in computing the monthly
16-5 contributions the subdivision makes to the subdivision accumulation
16-6 fund.]
16-7 (e) [(d)] After termination of employment with the
16-8 reemploying subdivision [all participating subdivisions] and
16-9 [after] filing with the retirement system [of] an application for
16-10 resumption of the suspended annuity [retirement with the board of
16-11 trustees], a person described by Subsection (b) [(a)] is entitled
16-12 to receive the payments of the suspended annuity that had been
16-13 transferred to the endowment fund and future payments of the
16-14 suspended annuity[, as provided by Subsection (e), and to the
16-15 additional benefits as provided by Subsections (f) and (g)].
16-16 (f) Beginning with [(e) Monthly payments of the suspended
16-17 annuity shall be resumed in] the month following the month in which
16-18 a retiree's employment is terminated with a reemploying subdivision
16-19 by death or other separation from service, future payments of the
16-20 suspended annuity become payable to each person entitled to the
16-21 annuity in the same amounts that would be payable if the annuity
16-22 had not been suspended [all participating subdivisions, without
16-23 change in the amount except for any increase allowed under Section
16-24 844.208 or the duration of or other condition pertaining to the
16-25 suspended benefit. Payment of the resumed benefit may not be made
16-26 for any month during which the payment was suspended under this
16-27 section].
17-1 (g) [(f)] If a person with credited service under this
17-2 section dies before a payment under Subsection (e) [(g)] is made,
17-3 monthly payments of a suspended annuity will resume under the terms
17-4 of the retirement annuity originally selected by the decedent, or a
17-5 person may make an election under Subsection (e) in the order of
17-6 preference provided by Section 844.407 [the person's beneficiary,
17-7 or if there is no beneficiary surviving, the person's spouse, or if
17-8 there is no surviving spouse, the executor or administrator of the
17-9 person's estate, may elect payment as provided by Section 844.407].
17-10 [(g) The additional service retirement benefit allowable to
17-11 a person to whom this section applies is, at the option of that
17-12 person, either a refund of accumulated contributions made since
17-13 reemployment plus any accrued interest on the accumulated
17-14 contributions allowed by the retirement system or a benefit
17-15 consisting of a basic annuity actuarially determined from the sum
17-16 of the member's deposits made and accumulated since the date of
17-17 last becoming a member and current service credit computed on the
17-18 amount of the deposits and a supplemental annuity actuarially
17-19 determined from the multiple matching credit applicable to the
17-20 amount of contributions made and accumulated with interest in the
17-21 person's individual account since last becoming a member. The
17-22 additional benefit is payable as a standard service retirement
17-23 benefit or, at the election of the member, any optional benefit
17-24 authorized under this subtitle that is the actuarial equivalent of
17-25 the standard retirement benefit. The first benefit payment date
17-26 under this section is the later of the end of the month following
17-27 the last month of employment or the end of the first month that
18-1 ends after the expiration of 45 days since the date the person
18-2 filed an application for payment. The first payment may not be made
18-3 if the person has resumed employment with a reemploying subdivision
18-4 in a position that would make the person an employee.]
18-5 [(h) If a person becomes an employee of a reemploying
18-6 subdivision within one calendar month after that person's effective
18-7 date of retirement from that reemploying subdivision, the person is
18-8 considered not to have retired, and the person's membership shall
18-9 be restored. The retirement system shall deduct the sum of one-half
18-10 of the basic annuity payments made before the membership is
18-11 restored from the person's individual account in the employees
18-12 saving fund and shall transfer that amount to the current service
18-13 annuity reserve fund. The retirement system shall reduce the
18-14 person's maximum prior service credit by an amount equal to the sum
18-15 of the prior service annuity payments made before the membership is
18-16 restored, divided by the product of the subdivision's allocated
18-17 prior service credit percentage multiplied by the interest factor
18-18 for interest from the subdivision's participation date to the
18-19 person's effective retirement date, both of which were used in
18-20 computing the amount of the prior service annuity.]
18-21 [(i) In this section, "reemploying subdivision" is a
18-22 subdivision for which a person previously has performed creditable
18-23 service and is receiving or would receive a retirement benefit
18-24 except for this section.]
18-25 Sec. 842.111. RESUMPTION OF SERVICE WITH DIFFERENT EMPLOYER
18-26 BY RETIREE. (a) If a person becomes an employee of a
18-27 participating subdivision after beginning to receive a service
19-1 retirement annuity [benefit], no portion of which is based on
19-2 service with that subdivision, the person resumes membership in the
19-3 retirement system without suspension of the person's retirement
19-4 annuity.
19-5 (b) After terminating employment with a participating
19-6 subdivision, a member described by Subsection (a) is eligible to
19-7 apply for and receive an additional standard or optional service
19-8 retirement annuity or a refund of the member's accumulated
19-9 contributions based on service with the subdivision, without regard
19-10 to any age or credited service requirement. [Member contributions
19-11 under Section 845.403 shall be made on all compensation paid to the
19-12 employee by the subdivision at the same rate as is required of
19-13 other employees of the subdivision. The retirement system shall
19-14 deposit the contributions on receipt in an individual account for
19-15 the member in the employees saving fund and shall credit the
19-16 account with interest at the same rate and in the same manner as
19-17 the accounts of other members are credited. The compensation paid
19-18 to the employee by the subdivision shall be included in computing
19-19 the monthly contributions the subdivision makes to the subdivision
19-20 accumulation fund.]
19-21 (c) On the death of a member described by Subsection (a), a
19-22 person may apply for and receive an optional service retirement
19-23 annuity or a refund of the decedent's accumulated contributions
19-24 with the subdivision, without regard to any age or credited service
19-25 requirement. [If a person with credited service under this section
19-26 dies before a payment under Subsection (d) is made, the person's
19-27 beneficiary or, if no beneficiary survives, the person's spouse, or
20-1 if there is no surviving spouse, the executor or administrator of
20-2 the person's estate, may elect payment as provided by Section
20-3 844.407.]
20-4 [(d) The additional service retirement benefit allowable to
20-5 a person to whom this section applies is, at the option of that
20-6 person, either a refund of accumulated contributions made since
20-7 reemployment plus any accrued interest on the accumulated
20-8 contributions allowed by the retirement system or a benefit
20-9 consisting of a basic annuity actuarially determined from the sum
20-10 of the member's deposits made and accumulated since the date of
20-11 last becoming a member and current service credit computed on the
20-12 amount of the deposits and a supplemental annuity actuarially
20-13 determined from the multiple matching credit applicable to the
20-14 amount of contributions made and accumulated with interest in the
20-15 person's individual account since last becoming a member. The
20-16 additional benefit is payable as a standard service retirement
20-17 benefit or, at the election of the member, any optional benefit
20-18 authorized under this subtitle that is the actuarial equivalent of
20-19 the standard retirement benefit. The first benefit payment date
20-20 under this section is the later of the end of the month following
20-21 the last month of employment or the end of the first month that
20-22 ends after the expiration of 45 days since the date the person
20-23 filed an application for payment. The first payment may not be made
20-24 if the person has resumed employment that would result in
20-25 suspension of a benefit.]
20-26 [(e) If a person becomes an employee of a subdivision after
20-27 beginning to receive a retirement benefit, no portion of which
21-1 benefit is based on service with that subdivision, and the person's
21-2 service retirement annuity is suspended under Section 842.110, as
21-3 it existed at the time service is resumed, the person may, on
21-4 written application to the retirement system, resume receiving the
21-5 suspended annuity.]
21-6 SECTION 9. Sections 842.112(b), (j), and (k), Government
21-7 Code, are amended to read as follows:
21-8 (b) Except as provided by Subsection (j) or Section 843.005,
21-9 a [A] correction may not be made as to current service performed,
21-10 or current service credit that should have been received, more than
21-11 four years before the date an application, on forms approved by the
21-12 retirement system's board of trustees, for the correction is
21-13 received by the retirement system.
21-14 (j) If, as a result of a suit against a participating
21-15 subdivision in a court of competent jurisdiction or as a result of
21-16 a complaint or grievance against a participating subdivision filed
21-17 with the United States Equal Opportunity Commission, the Commission
21-18 on Human Rights, or a county civil service commission, a judgment
21-19 or order is issued or a settlement agreement is executed, the terms
21-20 of which require that an employee receive back pay or that a person
21-21 be employed or reemployed for a specified period[, a person
21-22 receives a judgment against a subdivision ordering that the person
21-23 be reinstated as an employee of the subdivision retroactively to
21-24 the date the person's employment was terminated] and require
21-25 [ordering] that the person receive service credit toward retirement
21-26 based on the back pay or both service credit and credited service
21-27 for the specified period of employment or reemployment [for the
22-1 reinstated service], on written application to the retirement
22-2 system, the system shall grant the service credit and credited
22-3 service if:
22-4 (1) the judgment or order has become final and is no
22-5 longer subject to appeal;
22-6 (2) a certified copy of the judgment, order, or
22-7 settlement agreement accompanies the application;
22-8 (3) the retirement system receives payment on behalf
22-9 of [from] the person in an amount equal to the contributions the
22-10 person would have made to the system if the back pay or additional
22-11 service [employment] had [not] been [terminated and the service]
22-12 reported to the system; and
22-13 (4) the retirement system receives payment from the
22-14 subdivision in an amount equal to the additional contributions that
22-15 the subdivision would have made to the system for the additional
22-16 [credited] service credit.
22-17 (k) If a person to whom Subsection (j) applies has forfeited
22-18 service credit as a result of withdrawal of contributions during
22-19 the time between the termination of employment and the date of
22-20 reinstatement, the person is eligible to reestablish credit under
22-21 Section 843.003. For purposes of this subsection, forfeited credit
22-22 based on service performed for more than one participating
22-23 subdivision is considered to have been credit for service performed
22-24 only for the subdivision that is subject to the judgment, order, or
22-25 settlement agreement, except that credit may not be reinstated
22-26 under this subsection for service performed after the date of the
22-27 termination of employment that resulted in the judgment, order, or
23-1 settlement agreement.
23-2 SECTION 10. Section 842.201(e), Government Code, is amended
23-3 to read as follows:
23-4 (e) In this section, "prosecuting attorney" means a person
23-5 who holds the office of district attorney, criminal district
23-6 attorney, or county attorney performing the duties of a district
23-7 attorney and who is compensated by the state in an amount set by
23-8 appropriation [has the meaning assigned by Section 842.106(c)].
23-9 SECTION 11. Section 843.002, Government Code, is amended to
23-10 read as follows:
23-11 Sec. 843.002. BENEFIT ELIGIBILITY AND AMOUNT [BASED ON
23-12 CREDITED SERVICE]. A member's eligibility to receive a benefit is
23-13 based on the member's amount of credited service and attained age
23-14 on the effective date [at the time] of retirement. The monthly
23-15 amount of a standard retirement annuity is based on the sum of the
23-16 member's service credit and accumulated contributions and is
23-17 computed using the member's attained age and the actuarial
23-18 assumptions described by Section 841.001(1).
23-19 SECTION 12. Subchapter A, Chapter 843, Government Code, is
23-20 amended by adding Sections 843.004 and 843.005 to read as follows:
23-21 Sec. 843.004. COMPOSITION OF SERVICE CREDIT. Service credit
23-22 consists of allocated prior service credit, current service credit,
23-23 and multiple matching credit as authorized by a participating
23-24 subdivision and accumulated interest under this subtitle.
23-25 Sec. 843.005. ADJUSTMENT TO CREDITED SERVICE AND CURRENT
23-26 SERVICE CREDIT. (a) The governing body of a participating
23-27 subdivision by order or resolution may authorize the establishment
24-1 of credited service and current service credit for a particular
24-2 person who has not received the correct amount of credited service
24-3 or current service credit for all current service performed for the
24-4 subdivision and who is barred from doing so by the limitation
24-5 period provided by Section 842.112(b).
24-6 (b) To authorize the establishment of credited service and
24-7 current service credit under this section, the governing body must
24-8 determine that the reporting error occurred without the knowledge
24-9 or fault of the person and that the authorization is in the best
24-10 interests of the subdivision. The subdivision shall verify the
24-11 amounts of service and the compensation received by the person for
24-12 those months for which credited service and current service credit
24-13 may be established under this section.
24-14 (c) The order or resolution must include the findings of the
24-15 governing body, the name of the person to whom the authorization
24-16 relates, and the months for which credited service and current
24-17 service credit may be established and must state the total
24-18 compensation paid to the person for those months.
24-19 (d) The service credit attributable to the member
24-20 contributions deposited under this section is determined using the
24-21 credit percentages in effect for the month in which a deposit is
24-22 made.
24-23 (e) For credited service and service credit under this
24-24 section, the retirement system must receive, not later than the
24-25 last day of the calendar year in which an order or resolution is
24-26 adopted by the governing body of a participating subdivision:
24-27 (1) for deposit in the member's individual account,
25-1 all contributions the member would have made to the retirement
25-2 system if the current service had been correctly reported; and
25-3 (2) for deposit in the subdivision's account, an
25-4 amount determined by the retirement system's actuary as necessary
25-5 to fully offset the actuarial liability resulting from the
25-6 additional credited service and service credit.
25-7 SECTION 13. Section 843.103, Government Code, is amended to
25-8 read as follows:
25-9 Sec. 843.103. STATEMENT OF PRIOR SERVICE. Before the fifth
25-10 anniversary of the date a member becomes eligible to claim prior
25-11 service credit, a [A] member claiming credit for prior service
25-12 shall file a detailed statement of the service with the treasurer
25-13 or other disbursing officer of the subdivision for which the
25-14 service was performed.
25-15 SECTION 14. Section 843.105(c), Government Code, is amended
25-16 to read as follows:
25-17 (c) The allocated prior service credit is the percentage of
25-18 the maximum prior service credit granted by the subdivision to all
25-19 members who performed prior service for the subdivision. [The total
25-20 allocated prior service credits for members claiming prior service
25-21 with the subdivision may not exceed an amount for which the
25-22 prospective subdivision contributions to the retirement system will
25-23 be adequate to amortize, before the 25th anniversary of the
25-24 effective date of subdivision participation in the retirement
25-25 system:]
25-26 [(1) all obligations charged to its account in the
25-27 subdivision accumulation fund; and]
26-1 [(2) all basic and supplemental annuities derived from
26-2 credits granted by the subdivision.]
26-3 SECTION 15. Section 843.304, Government Code, is amended to
26-4 read as follows:
26-5 Sec. 843.304. CERTIFICATION OF SERVICE AND AVERAGE
26-6 COMPENSATION FOR MEMBER OF OPTIONAL CLASS [; DETERMINATION OF
26-7 ALLOCATED LOCAL SERVICE CREDIT]. (a) A member claiming credit for
26-8 prior service under this subchapter shall file a statement of prior
26-9 service in the manner required by Section 843.103.
26-10 (b) [After a member described in Section 843.301(a) files a
26-11 statement of prior service, the subdivision employing the officer
26-12 receiving the statement shall certify to the board of trustees the
26-13 amount of prior service approved and the average local
26-14 compensation, determined in the manner provided for computing the
26-15 average local compensation for employees of the subdivision who
26-16 became members on the effective date of merger of the local pension
26-17 system into the retirement system. After the board of trustees
26-18 receives a certification under this subsection, it shall determine
26-19 the maximum and allocated local service credits for the member in
26-20 the manner and using the percentages provided for employees of the
26-21 subdivision who became members on the effective date of merger.]
26-22 [(c)] After a member described in Section 843.302 files a
26-23 statement of prior service, the subdivision employing the officer
26-24 receiving the statement shall certify to the board of trustees the
26-25 amount of prior service approved and the average monthly
26-26 compensation paid by the subdivision, determined in the manner
26-27 provided for computing the average prior service compensation for
27-1 employees of the subdivision who became members on the effective
27-2 date of subdivision participation in the retirement system. After
27-3 the board of trustees receives a certification under this
27-4 subsection, it shall determine the maximum and allocated prior
27-5 service credits for the member in the manner and using the
27-6 percentages provided for computing the maximum and allocated prior
27-7 service credits for employees of the subdivision who became members
27-8 on the effective date of subdivision participation.
27-9 SECTION 16. Sections 843.403(b) and (c), Government Code, are
27-10 amended to read as follows:
27-11 (b) The current service credit of a member is an amount
27-12 equal to a percentage of the [accumulated] contributions made by
27-13 the member to the retirement system during a calendar year. The
27-14 percentage is determined by the governing body of the employing
27-15 subdivision at the time of its election to participate in the
27-16 retirement system, except that the percentage for a subdivision
27-17 that begins participation after December 31, 1977, is 100 percent.
27-18 (c) The multiple matching credit of a member is an amount
27-19 equal to a percentage of the [accumulated] contributions made by
27-20 the member to the retirement system during a calendar year. The
27-21 percentage is 0 percent until a greater percentage is adopted as
27-22 provided by Section 843.703 or, for a subdivision whose
27-23 participation in the retirement system began after October 31,
27-24 1980, unless a greater percentage is adopted by its governing body
27-25 before the first anniversary of the subdivision's effective date of
27-26 retirement system participation, after the actuary has determined
27-27 and certified that the greater percentage would not impair the
28-1 ability of the subdivision to amortize, before the 25th anniversary
28-2 of the participation date, all obligations that are charges against
28-3 its account in the subdivision accumulation fund. A multiple
28-4 matching credit includes any portion of a current service credit in
28-5 effect on January 1, 1978, that exceeds the member's current
28-6 service credit determined under Subsection (b).
28-7 SECTION 17. Section 843.501, Government Code, is amended to
28-8 read as follows:
28-9 Sec. 843.501. LEGISLATIVE SERVICE. (a) A member may
28-10 establish credited [credit for current] service in the retirement
28-11 system for service performed as a member of the legislature. A
28-12 member claiming credited service [credit] for previous legislative
28-13 service shall file a detailed statement of the service with the
28-14 [treasurer or other disbursing officer of the] subdivision by which
28-15 the member is currently employed. As soon as practicable after the
28-16 filing of a statement, the employing subdivision shall verify the
28-17 service claimed and certify to the board of trustees the amount of
28-18 service approved.
28-19 (b) Credited service [Credit] may not be established under
28-20 this section for service that is credited by another retirement
28-21 system or program established or governed by state law.
28-22 SECTION 18. Section 843.601(e), Government Code, is amended
28-23 to read as follows:
28-24 (e) Except for credited service [credit] established with
28-25 the retirement system before December 31, 1999, the maximum amount
28-26 of credited service that a person may receive under this section is
28-27 five years. If a person would receive more than five years of
29-1 credited service [credit] as a result of having received credit
29-2 under Subsection (c) before receiving credit under Subsection (b),
29-3 the retirement system shall cancel credited service [credit] under
29-4 Subsection (c) [shall be canceled] to the extent necessary to
29-5 reduce the total to five years of credit.
29-6 SECTION 19. Section 843.602(d), Government Code, is amended
29-7 to read as follows:
29-8 (d) In this section, "prosecuting attorney" has the meaning
29-9 assigned by Section 842.201(e) [842.106(c)].
29-10 SECTION 20. Section 844.001, Government Code, is amended to
29-11 read as follows:
29-12 Sec. 844.001. TYPES OF BENEFITS. The types of benefits
29-13 payable by the retirement system are:
29-14 (1) service retirement annuities [benefits];
29-15 (2) disability retirement annuities [benefits]; [and]
29-16 (3) survivor annuity death benefits;
29-17 (4) supplemental death benefits; and
29-18 (5) refunds of accumulated contributions.
29-19 SECTION 21. Section 844.002, Government Code, is amended by
29-20 adding Subsection (e) to read as follows:
29-21 (e) A separate retirement annuity is payable for each
29-22 participating subdivision from which a person retires under this
29-23 subtitle or is considered to have retired.
29-24 SECTION 22. Sections 844.003(a) and (d), Government Code, are
29-25 amended to read as follows:
29-26 (a) Except as provided by Subsections (b) and (d), the
29-27 effective date of a member's service retirement is the date the
30-1 member designates at the time the member applies for retirement
30-2 under Section 844.101, but the date must be the last day of a
30-3 calendar month and may not precede the date the member terminates
30-4 employment with the subdivision from which the member seeks to
30-5 retire [all participating subdivisions].
30-6 (d) A member who is eligible for service retirement and who
30-7 [on the day the member] terminates employment with a participating
30-8 subdivision may apply for and receive a service retirement annuity
30-9 based on service for that subdivision despite the fact that the
30-10 member is or becomes an employee of another participating
30-11 subdivision. Credited service [Service] with the member's new
30-12 employer may [not] be used in determining eligibility for service
30-13 retirement [the annuity, and contributions for the service may not
30-14 be used in determining the amount of the annuity]. A member who is
30-15 eligible for service retirement using combined credited service for
30-16 two or more subdivisions may simultaneously apply for and receive a
30-17 service retirement annuity for service to one subdivision and a
30-18 refund of accumulated contributions for service to another
30-19 subdivision. [The effective date of a retirement under this
30-20 subsection is the last day of the month in which the retirement
30-21 system receives the application, and that date may not be later
30-22 than the last day of the third month following the month in which
30-23 the member begins employment with the new employer.] A person who
30-24 retires under this subsection is considered for all purposes to be
30-25 a retiree who resumes service with a different employer under
30-26 Section 842.111.
30-27 SECTION 23. Section 844.005, Government Code, is amended to
31-1 read as follows:
31-2 Sec. 844.005. WHEN ANNUITY IS PAYABLE; CHANGES BEFORE FIRST
31-3 PAYMENT. (a) A retiree may revoke an application for retirement,
31-4 change the retiree's choice of retirement annuity payment plans, or
31-5 change the designation of beneficiary after the retiree's effective
31-6 date of retirement by filing written notice with the retirement
31-7 system not later than the last day of the month following the month
31-8 that includes the effective date of retirement [board of trustees
31-9 before the later of the date on which the retirement system makes
31-10 the first payment or the date the first annuity payment becomes
31-11 due]. After that day [the first payment has been made by the
31-12 retirement system or has become due], a retiree may not revoke the
31-13 application for retirement, change the annuity payment plan
31-14 selected, or [and may not] change the designated beneficiary except
31-15 under Section 844.006.
31-16 (b) A retiree who dies before the first day of the second
31-17 month following the month that includes the effective date of
31-18 retirement and who did not select an optional retirement annuity is
31-19 considered to have selected an optional annuity under Section
31-20 844.104(c)(7) or Section 844.305(c)(7), as applicable.
31-21 Alternatively, the decedent's beneficiary may elect to receive a
31-22 refund of the decedent's accumulated contributions under Section
31-23 844.401. [For purposes of this section, the term "makes payment"
31-24 includes the depositing in the mail of a payment or the crediting
31-25 of an account with payment through electronic funds transfer.]
31-26 (c) An annuity under this subtitle is payable to a retiree
31-27 or beneficiary through [for a period beginning on the last day of
32-1 the first month following] the month in which the retiree or
32-2 beneficiary dies [retirement occurs and ending, except as otherwise
32-3 provided by this subtitle, on the last day of the month immediately
32-4 preceding the month in which death occurs]. A continuation of an
32-5 optional annuity begins with payment for the month following the
32-6 month in which death occurs.
32-7 SECTION 24. Section 844.006(d), Government Code, is amended
32-8 to read as follows:
32-9 (d) If a qualified domestic relations order, as that term is
32-10 defined by Section 804.001, so provides, the benefit payable to a
32-11 retiree who is receiving payments of an annuity for the retiree's
32-12 life with payments to continue after the retiree's death until the
32-13 death of another person [under Option 1, 2, 4B, or 4C, as defined
32-14 by Section 103.2, Title 34, Texas Administrative Code,] may be
32-15 divided by the retirement system into two annuities if:
32-16 (1) the person who was designated to receive the
32-17 continued payment after the retiree's death is the same person as
32-18 the alternate payee;
32-19 (2) the [domestic relations] order specifies that one
32-20 of the two annuities is payable over the remaining life of the
32-21 retiree, with no payments to be made under that annuity after the
32-22 death of the retiree;
32-23 (3) the [domestic relations] order specifies that the
32-24 annuity payable to the alternate payee is payable over the
32-25 remaining life of that person, with no payments to be made under
32-26 that annuity after the death of the alternate payee named in the
32-27 order; and
33-1 (4) the annuity that would be payable to the person as
33-2 the alternate payee under the order would not exceed the annuity
33-3 that would be payable to that person as the retiree's surviving
33-4 beneficiary under the option selected if the retiree were deceased
33-5 [domestic relations order specifies that the portion of the benefit
33-6 payable to the alternate payee is stated as a fixed percentage of
33-7 the present benefit payable to the retiree, which percentage may
33-8 not exceed, as applicable:]
33-9 [(A) 25 percent of an Option 4B benefit;]
33-10 [(B) 50 percent of an Option 2 benefit; or]
33-11 [(C) 75 percent of an Option 4C benefit].
33-12 SECTION 25. Sections 844.009(a), (c), and (h), Government
33-13 Code, are amended to read as follows:
33-14 (a) [This section applies to all subdivisions that elect
33-15 after December 31, 1999, to begin participation in the retirement
33-16 system.] The governing body of a contributing [any] subdivision
33-17 with a member contribution rate of at least four percent that has
33-18 not elected to discontinue enrolling employees [participating as of
33-19 December 31, 1999,] may adopt the provisions of this section:
33-20 (1) on the terms provided by Subchapter H; or
33-21 (2) if the board of trustees determines that, based on
33-22 computations by the retirement system's actuary, the adoption would
33-23 not impair the ability of the subdivision to fund all obligations
33-24 against its account in the subdivision accumulation fund before the
33-25 25th anniversary of the subdivision's most recent actuarial
33-26 valuation date.
33-27 (c) The amount of a lump-sum distribution under this section
34-1 may not exceed 100 percent of the total accumulated contributions
34-2 [and accumulated interest] in the member's individual account in
34-3 the employees saving fund attributable to the credited service on
34-4 which the member has applied for retirement.
34-5 (h) No portion of a benefit awarded to an alternate payee
34-6 under a qualified domestic relations order may be distributed in
34-7 the form of a lump sum under this section, except that if the
34-8 member and the alternate payee agree in writing that the alternate
34-9 payee will receive all or a portion of the [a] lump-sum
34-10 distribution payable under this section [payment] instead of
34-11 benefits awarded under the qualified domestic relations order, the
34-12 amount of the lump-sum distribution described in the agreement may
34-13 be paid directly to the alternate payee in complete satisfaction of
34-14 the alternate payee's marital property rights and interest in the
34-15 member's benefit.
34-16 SECTION 26. Sections 844.101 and 844.102, Government Code,
34-17 are amended to read as follows:
34-18 Sec. 844.101. APPLICATION FOR SERVICE RETIREMENT ANNUITY. A
34-19 member may apply for a service retirement annuity by filing an
34-20 application for retirement with the retirement system [board of
34-21 trustees] on or before the member's effective retirement date
34-22 designated on the application.
34-23 Sec. 844.102. ELIGIBILITY FOR SERVICE RETIREMENT ANNUITY.
34-24 (a) A member is eligible to apply for and receive a service
34-25 retirement annuity[,] if the member:
34-26 (1) is at least 60 years old and has at least 12 years
34-27 of credited service in the retirement system;
35-1 (2) has at least 30 years of credited service in the
35-2 retirement system; or
35-3 (3) has met the eligibility requirements for service
35-4 retirement under Section 844.207, 844.210, or 844.211.
35-5 (b) A person who has retired with a service retirement
35-6 annuity is eligible, without regard to any age or credited service
35-7 requirement, to apply for and receive a service retirement annuity
35-8 based on service for another participating subdivision from which
35-9 the person has terminated employment.
35-10 SECTION 27. Section 844.104(c), Government Code, is amended
35-11 to read as follows:
35-12 (c) An eligible person may select any of the following
35-13 optional annuities that [, which] are the actuarial equivalent of
35-14 the annuity to which the person is entitled and that [which]
35-15 provide that:
35-16 (1) after the retiree's death, the reduced annuity is
35-17 payable throughout the life of a person designated by the retiree;
35-18 (2) after the retiree's death, one-half of the reduced
35-19 annuity is payable throughout the life of a person designated by
35-20 the retiree;
35-21 (3) if the retiree dies before 60 monthly annuity
35-22 payments have been made, the remainder of the 60 payments are
35-23 payable to the retiree's beneficiary or, if one does not exist, to
35-24 the retiree's estate;
35-25 (4) if the retiree dies before 120 monthly annuity
35-26 payments have been made, the remainder of the 120 payments are
35-27 payable to the retiree's beneficiary or, if one does not exist, to
36-1 the retiree's estate;
36-2 (5) after the retiree's death, the reduced annuity is
36-3 payable throughout the life of a person designated by the retiree,
36-4 except that if the beneficiary predeceases the retiree, the annuity
36-5 payable throughout the remaining life of the retiree is the annuity
36-6 that would be payable if the retiree had chosen a standard service
36-7 retirement annuity [one-fourth of the reduced annuity is payable
36-8 throughout the life of a person designated by the retiree];
36-9 (6) after the retiree's death, three-fourths of the
36-10 reduced annuity is payable throughout the life of a person
36-11 designated by the retiree; or
36-12 (7) if the retiree dies before 180 monthly annuity
36-13 payments have been made, the remainder of the 180 payments are
36-14 payable to the retiree's beneficiary or, if one does not exist, to
36-15 the retiree's estate.
36-16 SECTION 28. Sections 844.207, 844.210, and 844.211,
36-17 Government Code, are amended to read as follows:
36-18 Sec. 844.207. OPTIONAL BENEFIT ELIGIBILITY PLAN. (a) This
36-19 [The provisions of this] section applies [shall apply] to all
36-20 subdivisions that [elect after September 1, 1985, to] begin
36-21 participation in the retirement system after September 1, 1985, and
36-22 to all other subdivisions that have adopted the plan provisions of
36-23 this section. The [Subject to the conditions in this section, the]
36-24 governing body of a participating [any] subdivision [participating
36-25 as of September 1, 1985,] may adopt the plan provisions of this
36-26 section only on the terms provided by Subchapter H.
36-27 (b) In this section "eligible credited service" [The term
37-1 "Section 844.207 credited service" as used in this section] means
37-2 credited service performed for one or more participating
37-3 subdivisions that have adopted the plan provisions of this section
37-4 or [the plan provisions of] Section 844.210.
37-5 (c) A member is eligible to apply for and receive a service
37-6 retirement annuity[,] if the member:
37-7 (1) is at least 60 years old and has at least 10 years
37-8 of eligible [Section 844.207] credited service in the retirement
37-9 system; [or]
37-10 (2) is less than 60 years old, except as provided by
37-11 Subsection (e), and has a sufficient amount of eligible [years of
37-12 Section 844.207] credited service in the retirement system that,
37-13 when [that number is] added to the member's [years of] attained age
37-14 [of the member], equals or exceeds [produces a sum equal to or in
37-15 excess of] the number 80; or
37-16 (3) [if the member] is eligible for service retirement
37-17 under any other provision of this subtitle.
37-18 (d) A member who has 10 years or more of eligible [Section
37-19 844.207] credited service is a vested member for purposes of
37-20 Sections 844.202, 844.302, and 844.303.
37-21 (e) A member who on December 31, 1999, had [has] any
37-22 eligible [Section 844.207] credited service, whose membership in
37-23 the retirement system continues after that date without
37-24 interruption, and who accumulates four years or more of eligible
37-25 [Section 844.207] credited service is eligible to receive a service
37-26 retirement annuity regardless of age [benefit] when the amount of
37-27 eligible [number of years of Section 844.207] credited service
38-1 added to the [years of the] member's attained age equals or exceeds
38-2 the number 80.
38-3 [(f) After 1991, the governing body of a subdivision may not
38-4 adopt the plan provisions of this section except on the terms
38-5 provided by Subchapter H.]
38-6 Sec. 844.210. OPTIONAL BENEFIT ELIGIBILITY PLAN TWO. (a)
38-7 The [Subject to Subsection (f), the] governing body of a
38-8 participating subdivision may adopt the plan provisions of this
38-9 section only on the terms provided by Subchapter H.
38-10 (b) In this section "eligible credited service" ["Section
38-11 844.210 credited service"] means credited service performed for one
38-12 or more participating subdivisions that have adopted the plan
38-13 provisions of this section.
38-14 (c) A member is eligible to apply for and receive a service
38-15 retirement annuity if the member:
38-16 (1) is at least 60 years old and has at least eight
38-17 years of eligible [Section 844.210] credited service in the
38-18 retirement system;
38-19 (2) is less than 60 years old, except as provided by
38-20 Subsection (e), and has a sufficient amount of eligible [years of
38-21 Section 844.210] credited service in the retirement system that,
38-22 when added to the [years of the] member's attained age, equals or
38-23 exceeds [produces a sum equal to or in excess of] the number 80; or
38-24 (3) is eligible for service retirement under any other
38-25 provision of this subtitle.
38-26 (d) A member who has eight years or more of eligible
38-27 [Section 844.210] credited service in the retirement system is a
39-1 vested member for purposes of Sections 844.202, 844.302, and
39-2 844.303.
39-3 (e) A member who on December 31, 1999, had [has] any
39-4 eligible [Section 844.210] credited service, whose membership in
39-5 the retirement system continues after that date without
39-6 interruption, and who accumulates four years or more of eligible
39-7 [Section 844.210] credited service is eligible to receive a service
39-8 retirement annuity regardless of age [benefit] when the amount of
39-9 eligible [number of years of Section 844.210] credited service
39-10 added to the [years of the] member's attained age equals or exceeds
39-11 the number 80. For purposes of this subsection, eligible [Section
39-12 844.210] credited service also includes credited service performed
39-13 for one or more subdivisions that have adopted the plan provisions
39-14 of Section 844.207.
39-15 [(f) The governing body of a subdivision may not adopt the
39-16 plan provisions of this section except on the terms provided by
39-17 Subchapter H.]
39-18 Sec. 844.211. OPTIONAL BENEFIT ELIGIBILITY PLAN THREE. (a)
39-19 The [Subject to Subsection (e), the] governing body of a
39-20 participating subdivision may adopt the plan provisions of this
39-21 section only on the terms provided by Subchapter H.
39-22 (b) In this section "eligible credited service" ["Section
39-23 844.211 credited service"] means credited service performed for one
39-24 or more participating subdivisions that have adopted the plan
39-25 provisions of this section.
39-26 (c) A member is eligible to apply for and receive a service
39-27 retirement annuity if the member:
40-1 (1) is less than 60 years old, except as provided by
40-2 Subsection (d), and has a sufficient amount of eligible [years of
40-3 Section 844.211] credited service in the retirement system that,
40-4 when added to the [years of the] member's attained age, equals or
40-5 exceeds [produces a sum equal to or in excess of] the number 75; or
40-6 (2) is eligible for service retirement under any other
40-7 provision of this subtitle.
40-8 (d) A member who on December 31, 1999, had [has] any
40-9 eligible [Section 844.211] credited service, whose membership in
40-10 the retirement system continues after that date without
40-11 interruption, and who accumulates four years or more of eligible
40-12 [Section 844.211] credited service is eligible to receive a service
40-13 retirement annuity regardless of age [benefit] when the amount of
40-14 eligible [number of years of that] credited service added to the
40-15 years of the member's attained age equals or exceeds the number 75.
40-16 [(e) The governing body of a subdivision may not adopt the
40-17 plan provisions of this section except on the terms provided by
40-18 Subchapter H.]
40-19 SECTION 29. Section 844.301(a), Government Code, is amended
40-20 to read as follows:
40-21 (a) A member may apply for a disability retirement annuity
40-22 by:
40-23 (1) filing an application for retirement with the
40-24 retirement system [board of trustees]; or
40-25 (2) having an application filed with the system
40-26 [board] by the member's employer or legal representative.
40-27 SECTION 30. Section 844.304(a), Government Code, is amended
41-1 to read as follows:
41-2 (a) The standard disability retirement annuity is discounted
41-3 for the possibility of payment of a benefit under Section 844.402
41-4 [844.403] and is the actuarial equivalent of the sum of a member's:
41-5 (1) accumulated contributions;
41-6 (2) current service credit, accumulated at interest as
41-7 provided by Section 843.403(d);
41-8 (3) allocated prior service credit, accumulated at
41-9 interest as provided by Section 843.105(d); and
41-10 (4) multiple matching credit, accumulated at interest
41-11 as provided by Section 843.403(d).
41-12 SECTION 31. Section 844.305(c), Government Code, is amended
41-13 to read as follows:
41-14 (c) An eligible person may select any of the following
41-15 optional annuities that [, which] are the actuarial equivalent of
41-16 the annuity to which the person is entitled and that [which]
41-17 provide that:
41-18 (1) after the retiree's death, the reduced annuity is
41-19 payable throughout the life of a person designated by the retiree;
41-20 (2) after the retiree's death, one-half of the reduced
41-21 annuity is payable throughout the life of a person designated by
41-22 the retiree;
41-23 (3) if the retiree dies before 60 monthly annuity
41-24 payments have been made, the remainder of the 60 payments are
41-25 payable to the retiree's beneficiary or, if one does not exist, to
41-26 the retiree's estate;
41-27 (4) if the retiree dies before 120 monthly annuity
42-1 payments have been made, the remainder of the 120 payments are
42-2 payable to the retiree's beneficiary or, if one does not exist, to
42-3 the retiree's estate;
42-4 (5) after the retiree's death, the reduced annuity is
42-5 payable throughout the life of a person designated by the retiree,
42-6 except that if the beneficiary predeceases the retiree, the annuity
42-7 payable throughout the remaining life of the retiree is the annuity
42-8 that would be payable if the retiree had chosen a standard service
42-9 retirement annuity [one-fourth of the reduced annuity is payable
42-10 throughout the life of a person designated by the retiree];
42-11 (6) after the retiree's death, three-fourths of the
42-12 reduced annuity is payable throughout the life of a person
42-13 designated by the retiree; or
42-14 (7) if the retiree dies before 180 monthly annuity
42-15 payments have been made, the remainder of the 180 payments are
42-16 payable to the retiree's beneficiary or, if one does not exist, to
42-17 the retiree's estate.
42-18 SECTION 32. Subchapter D, Chapter 844, Government Code, is
42-19 amended by adding Section 844.3051 to read as follows:
42-20 Sec. 844.3051. ANNUITIES NOT SUBJECT TO DISCONTINUANCE. (a)
42-21 After the earlier of the date a disability retiree attains age 60
42-22 or the date the disability retiree would otherwise have become
42-23 eligible for service retirement under this subtitle, the retiree's
42-24 disability retirement annuity may not be revoked or discontinued
42-25 under this subtitle, and the retiree is not subject to further
42-26 medical examinations or required to submit annual earnings reports.
42-27 (b) A disability retirement annuity that is not subject to
43-1 revocation or discontinuance is considered a service retirement
43-2 annuity if the retiree returns to employment with a participating
43-3 subdivision.
43-4 SECTION 33. Section 844.306(a), Government Code, is amended
43-5 to read as follows:
43-6 (a) Once each year during the first five years after a
43-7 person retires for disability, and once in each three-year period
43-8 after that, the board of trustees may require a disability retiree
43-9 [who is less than 60 years old] to undergo a medical examination.
43-10 SECTION 34. Section 844.307(a), Government Code, is amended
43-11 to read as follows:
43-12 (a) If the medical board finds that a disability retiree
43-13 [who is less than 60 years old] is no longer mentally or physically
43-14 incapacitated for the performance of duty or is engaged in or able
43-15 to engage in gainful occupation, it shall certify its findings and
43-16 submit them to the board of trustees.
43-17 SECTION 35. Sections 844.308 and 844.309, Government Code,
43-18 are amended to read as follows:
43-19 Sec. 844.308. RETURN OF DISABILITY RETIREE TO MEMBERSHIP. If
43-20 the disability annuity of a person [who is less than 60 years old]
43-21 is discontinued under Section 844.306(c) or 844.307, the person
43-22 automatically resumes membership in the retirement system, and the
43-23 board of trustees shall terminate the person's annuity payments.
43-24 Sec. 844.309. ADJUSTMENTS AT ANNUITY DISCONTINUANCE. (a) If
43-25 a person's membership resumes [is restored] under Section 844.308,
43-26 the retirement system shall transfer:
43-27 (1) from the current service annuity reserve fund and
44-1 credit to the person's individual account in the employees saving
44-2 fund an [the] amount equal to the amount of accumulated
44-3 contributions transferred to the current service annuity reserve
44-4 fund at the time of retirement reduced by one percent for each year
44-5 or part of a year during which disability annuity payments were
44-6 made [, if any, by which the amount in the person's individual
44-7 account in the employees saving fund at the time of disability
44-8 retirement exceeds the sum of one-half of all basic annuity
44-9 payments made before the date the annuity was discontinued]; and
44-10 (2) from the current service annuity reserve fund to
44-11 the subdivision accumulation fund an amount equal to the amount
44-12 [sum] transferred from the subdivision accumulation fund to the
44-13 current service annuity reserve fund at the time of retirement
44-14 reduced by one percent for each year or part of a year during which
44-15 disability annuity payments were made [under Subdivision (1) of
44-16 this subsection to the employees saving fund].
44-17 (b) If a person whose [who is restored to] membership
44-18 resumes under Section 844.308 was receiving a supplemental annuity
44-19 based in whole or in part on [allocated] prior service credit, the
44-20 retirement system shall restore to effect as the person's maximum
44-21 [allocated] prior service credit an [the] amount equal to [by
44-22 which] the person's maximum [allocated] prior service credit at the
44-23 time of disability retirement reduced by one percent for each year
44-24 or part of a year during which disability annuity payments were
44-25 made [exceeds the sum of all annuity payments, based on prior
44-26 service credits, that were made before discontinuance of the
44-27 supplemental annuity].
45-1 (c) A person who resumes membership under Section 844.308 is
45-2 entitled to restoration of credited service in the number of months
45-3 accumulated and allowed before disability retirement.
45-4 (d) The board of trustees may adopt rules for the
45-5 computation and transfer of amounts and credits for a membership
45-6 resumed under this subchapter.
45-7 SECTION 36. Section 844.310(a), Government Code, is amended
45-8 to read as follows:
45-9 (a) The retirement system may require a disability retiree
45-10 [who is less than 60 years old] to submit annually to the
45-11 retirement system a report of earnings. The retirement system shall
45-12 examine each report and may require at any time that a disability
45-13 retiree undergo a medical examination by one or more physicians the
45-14 retirement system designates, if the retiree has reported earnings
45-15 that the board of trustees considers to show an ability to engage
45-16 in gainful employment.
45-17 SECTION 37. Sections 844.401 and 844.402, Government Code,
45-18 are amended to read as follows:
45-19 Sec. 844.401. RETURN OF ACCUMULATED CONTRIBUTIONS. (a)
45-20 Except as provided by Subsection (c), if a member dies before
45-21 retirement, a lump-sum death benefit is payable from the employees
45-22 saving fund in the amount of:
45-23 (1) the decedent's accumulated contributions [in the
45-24 member's individual account in the fund]; plus
45-25 (2) interest computed on the decedent's accumulated
45-26 contributions on January 1 of the year of death from the beginning
45-27 of that [the] year [in which death occurs] through the end of the
46-1 month before the month in which death occurs [on the balance in the
46-2 member's individual account in the employees saving fund on January
46-3 1 of the year in which the member's death occurs].
46-4 (b) The benefit provided by this section is payable to the
46-5 decedent's beneficiary or, if no surviving beneficiary exists, to
46-6 the decedent's spouse or, if no surviving spouse exists, to the
46-7 decedent's estate [unless the decedent has directed that the
46-8 benefit be paid otherwise].
46-9 (c) A benefit is not payable under this section if an
46-10 annuity based on the same [decedent's] service with the subdivision
46-11 is payable under this subtitle.
46-12 Sec. 844.402. RETURN OF EXCESS CONTRIBUTIONS [OF SERVICE
46-13 RETIREE]. (a) After the death of a member or former member and
46-14 after the final payment has been made under any service,
46-15 disability, or survivor annuity [If a person who receives a
46-16 standard service retirement annuity dies], a lump-sum death benefit
46-17 is payable in an amount, if any, by which the amount in the
46-18 person's [retiree's] individual account in the employees saving
46-19 fund on which the annuity was computed [at the time of service
46-20 retirement] exceeds the amount of annuity payments made [before the
46-21 retiree's death].
46-22 (b) The benefit provided by this section is payable to the
46-23 person entitled to receive the final monthly payment of the annuity
46-24 [decedent's estate unless the decedent has directed that the
46-25 benefit be paid otherwise]. If that person is deceased, the benefit
46-26 provided by this section is payable to the person's beneficiary or,
46-27 if no surviving beneficiary exists, to the person's spouse or, if
47-1 no surviving spouse exists, to the person's estate.
47-2 (c) The benefit provided by this section is payable from the
47-3 current service annuity reserve fund and the subdivision
47-4 accumulation fund in the ratio that the parts of the [service]
47-5 retirement annuity that were payable from the funds bear to the
47-6 entire benefit as determined on the effective date of retirement.
47-7 SECTION 38. Sections 844.407(a), (e), and (h), Government
47-8 Code, are amended to read as follows:
47-9 (a) In this section "eligible member" means:
47-10 (1) a member who has four or more years of credited
47-11 service with one or more subdivisions that [on September 1, 1999,]
47-12 are participating in the retirement system and that are not
47-13 exempted from the application of this subdivision [or that begin
47-14 participation in the system after that date];
47-15 (2) a vested member described by Section 844.202 who
47-16 is at least 60 years of age or has 20 or more years of credited
47-17 service [with one or more subdivisions participating] in the
47-18 retirement system; or
47-19 (3) a member who is receiving a service retirement
47-20 annuity [at least 60 years of age and has 12 or more years of
47-21 credited service with one or more subdivisions participating in the
47-22 system;]
47-23 [(4) a member who is at least 60 years of age and has
47-24 10 or more years of Section 844.207 credited service; or]
47-25 [(5) a member who is at least 60 years of age and has
47-26 eight or more years of Section 844.210 credited service].
47-27 (e) [An unrevoked application for deferred service
48-1 retirement executed and filed by the member with the retirement
48-2 system before December 31, 1999, shall be considered a selection of
48-3 benefit and a designation of beneficiary under Subsection (c).] If
48-4 no application for deferred service retirement was [is] on file
48-5 with the retirement system on December 31, 1999 [on that date], an
48-6 unrevoked form executed by the member and filed with the system
48-7 naming a beneficiary to whom the member's accumulated contributions
48-8 [deposits] are to be paid in the event of death before retirement
48-9 is [shall be] considered a selection of a beneficiary under
48-10 Subsection (d).
48-11 (h) If no surviving spouse exists, the executor or
48-12 administrator of the member's estate may elect[:]
48-13 [(1)] for an estate beneficiary to receive the
48-14 optional annuity under Section 844.104(c)(7) [; or]
48-15 [(2) for the estate to receive a refund of the
48-16 member's accumulated contributions under Section 844.401].
48-17 SECTION 39. Section 844.408(b), Government Code, is amended
48-18 to read as follows:
48-19 (b) If a surviving spouse or the executor or administrator
48-20 of a deceased member's estate would be entitled to make an election
48-21 under Section 842.110 [842.110(f)] or 842.111 [842.111(c)], or if a
48-22 beneficiary or the executor or administrator of a deceased member's
48-23 estate would be entitled to make an election under Section 844.407
48-24 because of the death of the member, the heirs of the deceased
48-25 member may make that election if:
48-26 (1) no surviving spouse exists, or, if Section 844.407
48-27 is applicable, no surviving beneficiary exists;
49-1 (2) no petition for the appointment of a personal
49-2 representative of the member is pending or has been granted;
49-3 (3) 30 days have elapsed since the date of death of
49-4 the member;
49-5 (4) the value of the entire assets of the member's
49-6 estate, excluding homestead and exempt property, does not exceed
49-7 $50,000; and
49-8 (5) on file with the retirement system is a certified
49-9 copy of a small estates affidavit that has been approved and filed
49-10 in accordance with Section 137, Texas Probate Code, or an original
49-11 affidavit described by Subsection (c).
49-12 SECTION 40. Section 844.501, Government Code, is amended by
49-13 adding Subsection (c) to read as follows:
49-14 (c) The supplemental death benefit program constitutes
49-15 "group term life insurance purchased for employees" as described by
49-16 Section 79 of the federal Internal Revenue Code of 1986.
49-17 SECTION 41. Sections 844.503(a), (b), and (c), Government
49-18 Code, are amended to read as follows:
49-19 (a) In this section, the terms "regular rate of pay," "hours
49-20 worked," "salary basis," and "regular salary" have meanings that
49-21 are consistent with the Fair Labor Standards Act of 1938 (29 U.S.C.
49-22 Section 201 et seq.).
49-23 (b) If a person included in the coverage or extended
49-24 coverage of the supplemental death benefit program dies, a lump-sum
49-25 supplemental death benefit is payable from the supplemental death
49-26 benefits fund in an amount equal to the current annual compensation
49-27 [salary] of the member at the time of death.
50-1 (c) The [(b) Except as provided by Subsection (c), the]
50-2 current annual compensation [salary] of a member who is not exempt
50-3 from the minimum wage and maximum hour requirements of the Fair
50-4 Labor Standards Act of 1938 (29 U.S.C. Section 201 et seq.) is
50-5 computed by converting to an annual basis the regular rate of pay
50-6 of the member for the most recent hour worked and proportionately
50-7 reducing that annual basis if the member is not employed in a
50-8 full-time position. The current annual compensation of a member
50-9 who is exempt from those minimum wage and maximum hour requirements
50-10 and who is paid on a salary basis is computed by converting to an
50-11 annual basis the regular salary paid to the member for the most
50-12 recent pay period of active employment [as the amount paid to the
50-13 member for service on which contributions were made to the
50-14 retirement system during the 12 months immediately preceding the
50-15 month of death. If a member did not receive compensation for
50-16 service in each of the 12 months immediately preceding the month of
50-17 death, the member's current annual salary is computed by converting
50-18 to an annual basis the amount paid to the member on which
50-19 contributions were made to the system during the period of
50-20 employment within the 12-month period. If a member did not receive
50-21 compensation for service in any of the 12 months immediately
50-22 preceding the month of death, or if the member was employed by a
50-23 subdivision that was not participating on a full-salary basis for
50-24 12 calendar months immediately preceding the month of death, the
50-25 member's current annual salary is computed by converting to an
50-26 annual basis the rate of compensation payable to the member during
50-27 the month of death].
51-1 [(c) The current annual salary of a member included in the
51-2 extended coverage of the supplemental death benefit program is
51-3 computed in the manner provided by Subsection (b) but as if the
51-4 member had died during the first month of extended coverage.]
51-5 SECTION 42. Section 844.504, Government Code, is amended to
51-6 read as follows:
51-7 Sec. 844.504. RETIREE SUPPLEMENTAL DEATH BENEFIT. If a
51-8 retiree dies who was receiving a retirement annuity based on [has
51-9 credited] service for [that has not been canceled by a withdrawal
51-10 of contributions and that results from employment with] a
51-11 subdivision that has elected to provide, and continues to provide,
51-12 postretirement supplemental death benefits, a lump-sum supplemental
51-13 death benefit is payable from the fund in the amount of $5,000
51-14 [$2,500]. If a retiree dies who was receiving retirement annuities
51-15 based on service for [employed by] more than one subdivision that
51-16 has elected to provide, and continues to provide, postretirement
51-17 supplemental death benefits, the financing of the lump-sum benefit
51-18 will [shall] be prorated among those [the employing] subdivisions
51-19 [participating in the fund]. If a person dies while payment of a
51-20 retirement annuity to that person is suspended as a result of
51-21 Section 842.110, the supplemental death benefit under this section
51-22 will [shall] be paid if it would have been payable except for the
51-23 suspension, unless a supplemental death benefit is payable under
51-24 Section 844.503 as a result of the member's death.
51-25 SECTION 43. Section 844.703(d), Government Code, is amended
51-26 to read as follows:
51-27 (d) The actuary annually shall determine the subdivision
52-1 normal contribution rate and the prior service contribution rate
52-2 for subdivisions adopting the plan provisions of this subchapter
52-3 from the most recent data available at the time of determination.
52-4 Before January 1 of each year, the board of trustees shall certify
52-5 the rates of each subdivision that has adopted the plan provisions
52-6 of this subchapter. If the combined rates of the subdivision's
52-7 normal contributions and prior service contributions under this
52-8 subchapter exceed the rate prescribed by Subsection (c), and if the
52-9 governing body of the subdivision has not waived that maximum rate,
52-10 the rate for prior service contributions must be reduced to the
52-11 rate that equals the difference between the maximum rate prescribed
52-12 by Subsection (c) and the normal contribution rate. The governing
52-13 body may elect to contribute at a rate that is greater than the sum
52-14 of the subdivision's normal contribution rate and prior service
52-15 contribution rate as determined under Subsections (a) and (b). An
52-16 elected rate may [an integer percent but] not exceed [more than]
52-17 the maximum rate prescribed by Subsection (c), unless the governing
52-18 body has elected to waive that maximum rate[, if that elected rate
52-19 exceeds the sum of the subdivision's normal contribution rate and
52-20 its prior service contribution rate as determined under Subsections
52-21 (a) and (b)]. An [This] elected rate remains in effect for each
52-22 subsequent calendar year until it is rescinded by the governing
52-23 body. For years in which [or until] the sum of the rates
52-24 determined under Subsections (a) and (b) exceeds the elected rate,
52-25 [at which time] the governing body must contribute the sum of the
52-26 rates determined under Subsections (a) and (b). For years in which
52-27 the elected rate exceeds the sum of the rates determined under
53-1 Subsections (a) and (b), the prior service contribution rate is
53-2 increased to the rate that equals the difference between the
53-3 elected rate and the normal contribution rate prescribed by
53-4 Subsection (a).
53-5 SECTION 44. Sections 844.704(b) and (d), Government Code, are
53-6 amended to read as follows:
53-7 (b) On the adoption of the plan provisions of this
53-8 subchapter, the governing body shall select a percentage for
53-9 determining allocated prior service credits under Section 843.105[,
53-10 notwithstanding the limitation in Section 843.105(c)]. The
53-11 governing body shall select a percentage that is a multiple of five
53-12 percent. For a subdivision that began participation before January
53-13 1, 1992, the percentage cannot be less than the percentage in
53-14 effect immediately before the adoption of the plan. The governing
53-15 body may [thereafter] increase the percentage used in determining
53-16 allocated prior service credits under Section 843.105, to take
53-17 effect on the next January 1 after the date of the increase. The
53-18 selection of or increase in the percentage used in determining
53-19 allocated prior service credits may not result in greater benefits
53-20 being provided for completed service than would be provided through
53-21 current service credits and multiple matching credits for service
53-22 that is performed in the future.
53-23 (d) The governing body of a subdivision that has adopted or
53-24 is adopting the plan provisions of this subchapter may adopt or
53-25 authorize:
53-26 (1) an [the alternative optional] increase in
53-27 retirement annuities under Section 844.209;
54-1 (2) an [the optional] increase in retirement annuities
54-2 under Section 844.208;
54-3 (3) the [optional authorization of the]
54-4 reestablishment of credited service previously forfeited under
54-5 Section 843.003;
54-6 (4) the [optional authorization of the] establishment
54-7 of credited service for military service under Section 843.601(c);
54-8 (5) the reduction in the credited service requirement
54-9 for military service under Section 843.601(g);
54-10 (6) the [optional authorization of the] establishment
54-11 of premembership credited service for overage employees under
54-12 Section 843.204;
54-13 (7) [(6)] the [optional] benefit eligibility plan
54-14 described by Section 844.210 or 844.211; or
54-15 (8) the partial lump-sum distribution on service
54-16 retirement under Section 844.009 [(7) the optional benefit
54-17 eligibility plan described by Section 844.211].
54-18 SECTION 45. Section 845.306, Government Code, is amended to
54-19 read as follows:
54-20 Sec. 845.306. EMPLOYEES SAVING FUND. (a) The retirement
54-21 system shall deposit in a member's individual account in the
54-22 employees saving fund:
54-23 (1) the amount of contributions to the retirement
54-24 system deducted from the member's compensation;
54-25 (2) interest allowed on money in the account in
54-26 accordance with this subtitle;
54-27 (3) the portion of a deposit required by Section
55-1 843.003 to reinstate credited service previously terminated that
55-2 represents the amount withdrawn;
55-3 (4) the amount deposited in accordance with this
55-4 subtitle [Section 843.301(b) or 843.402(b)] to establish credit for
55-5 prior or current service for a person who became a member in
55-6 accordance with Subchapter C, Chapter 842;
55-7 (5) the amount, if any, deposited by a member in
55-8 accordance with Section 843.601(b) to establish current service
55-9 credit for military service; and
55-10 (6) the amount deposited by a person to become a
55-11 member in accordance with Section 842.103.
55-12 (b) The retirement system shall establish and maintain a
55-13 separate member individual account for each subdivision with which
55-14 the member has credited service.
55-15 (c) On December 31 of each year, the retirement system shall
55-16 credit to each member's individual account interest as allowed by
55-17 this subtitle on the amount of accumulated contributions [deposits]
55-18 credited to the member's account on January 1 of that year.
55-19 SECTION 46. Section 845.307(a), Government Code, is amended
55-20 to read as follows:
55-21 (a) The retirement system shall deposit in the account of a
55-22 participating subdivision in the subdivision accumulation fund:
55-23 (1) all benefit contributions made by the subdivision
55-24 to the system pursuant to Section 845.404(a)(2);
55-25 (2) income allocated to the fund as provided by this
55-26 subtitle;
55-27 (3) amounts deposited by the subdivision under Section
56-1 845.408;
56-2 (4) the withdrawal charge for reinstatement of
56-3 credited service as provided by Section 843.003;
56-4 (5) the amount of matching contributions made by a
56-5 subdivision in accordance with this subtitle [Section 843.301(c) or
56-6 843.402(c)] to establish credit for prior or current service for a
56-7 person who became a member in accordance with Subchapter C, Chapter
56-8 842; and
56-9 (6) the amount deposited by a subdivision for a person
56-10 to become a member in accordance with Section 842.103.
56-11 SECTION 47. Section 845.310(f), Government Code, is amended
56-12 to read as follows:
56-13 (f) The retirement system shall deposit and hold in the
56-14 perpetual endowment account funds, gifts, and awards that the
56-15 grantors designate as perpetual endowment for the retirement system
56-16 [and money forfeited to the retirement system as provided by
56-17 Section 845.505].
56-18 SECTION 48. Section 845.313, Government Code, is amended by
56-19 adding Subsection (c) to read as follows:
56-20 (c) The retirement system shall make payments by electronic
56-21 funds transfer to annuitants whose first annuity payment under this
56-22 subtitle occurs after January 1, 2002, except that the system may
56-23 make payment by check to an annuitant if making the payment by
56-24 electronic funds transfer would be impractical for the system or if
56-25 the annuitant properly notifies the system that:
56-26 (1) receiving the payment by electronic funds transfer
56-27 would be impractical for the person;
57-1 (2) receiving the payment by electronic funds transfer
57-2 would be more costly to the person than receiving the payment by
57-3 check; or
57-4 (3) the person is unable to establish a qualifying
57-5 account at a financial institution to receive electronic funds
57-6 transfers.
57-7 SECTION 49. Section 845.315(a), Government Code, is amended
57-8 read as follows:
57-9 (a) On December 31 of each year and after the balance of the
57-10 investment expenses account has been transferred to the
57-11 distributable income account, the board of trustees shall transfer
57-12 from the distributable income account of the interest fund the
57-13 following amounts:
57-14 (1) to the current service annuity reserve fund,
57-15 interest on the mean amount in the current service annuity reserve
57-16 fund during that year;
57-17 (2) to the supplemental death benefits fund, interest
57-18 on the mean amount in the supplemental death benefits fund during
57-19 that year;
57-20 (3) to the general reserves account of the endowment
57-21 fund, a dollar amount determined by the board of trustees as
57-22 necessary to provide adequate funding of the endowment fund,
57-23 including provisions for all special needs, all contingencies,
57-24 replenishment of the amount transferred during the current year to
57-25 the employees saving fund for interest to retiring or deceased
57-26 members plus the matching amount transferred to the subdivision
57-27 accumulation fund, and funding of investment expenses and
58-1 administrative costs for the following year;
58-2 (4) to the employees saving fund, current interest on
58-3 the sum of the accumulated contributions [deposits] in the
58-4 employees saving fund credited on January 1 of that year to all
58-5 persons who are members on December 31 of that year before any
58-6 transfers for retirement effective December 31 of that year are
58-7 made; and
58-8 (5) to the subdivision accumulation fund, the
58-9 remaining balance of the distributable income account in the
58-10 interest fund after transfers provided for by Subdivisions (1),
58-11 (2), (3), and (4) have been made.
58-12 SECTION 50. Sections 845.316(a) and (b), Government Code, are
58-13 amended to read as follows:
58-14 (a) When a member retires, the retirement system shall
58-15 transfer:
58-16 (1) from the employees saving fund to the current
58-17 service annuity reserve fund, the member's accumulated
58-18 contributions [deposits]; and
58-19 (2) from the subdivision accumulation fund to the
58-20 current service annuity reserve fund, an amount equal to the
58-21 member's accumulated current service credit.
58-22 (b) If the retiring member's accumulated contributions
58-23 [deposits] are the result of service for more than one
58-24 participating subdivision, the retirement system shall reduce the
58-25 amount credited to the account of each subdivision by the amount
58-26 chargeable to the subdivision for the member.
58-27 SECTION 51. Section 845.407, Government Code, is amended to
59-1 read as follows:
59-2 Sec. 845.407. PENALTY FOR LATE CONTRIBUTIONS. (a) Except as
59-3 provided by Subsections (c) and (d), a [A] participating
59-4 subdivision that fails to provide the information required by
59-5 Section 845.403 or to pay all contributions required by this
59-6 subchapter to be made and remitted to the retirement system not
59-7 later than the 15th [before the 16th] day of the month in which
59-8 they become [are] due shall pay a penalty under this section. The
59-9 penalty for a past-due monthly remission is equal to interest on
59-10 the past-due amounts for each day past due at a nominal interest
59-11 rate of 12 percent, plus a $500 administrative fee. If the penalty
59-12 is not paid within three months after the date notice of the
59-13 penalty has been sent to the subdivision, the retirement system
59-14 shall deduct the penalty from the subdivision's account in the
59-15 subdivision accumulation fund. The interest portion of the penalty
59-16 shall be deposited by the retirement system in the distributable
59-17 income account of the interest fund. The administrative fee
59-18 portion of the penalty shall be deposited by the retirement system
59-19 in the expense fund.
59-20 (b) Payments [Payment] and required reports are considered
59-21 to be made when received by the retirement system.
59-22 (c) A penalty will not be assessed under this section for a
59-23 late payment or report made in a document sent to the correct
59-24 address:
59-25 (1) by first-class mail not later than the 10th day of
59-26 the month in which the payment or report becomes due; or
59-27 (2) using a same-day or overnight delivery method,
60-1 approved by the board of trustees, not later than the 14th day of
60-2 the month in which the payment or report becomes due.
60-3 (d) If the retirement system does not receive a payment or
60-4 report, a penalty will not be assessed under this section if the
60-5 subdivision provides proof satisfactory to the system that the
60-6 document containing the payment or report was sent in accordance
60-7 with Subsection (c).
60-8 SECTION 52. Section 845.505, Government Code, is amended to
60-9 read as follows:
60-10 Sec. 845.505. UNCLAIMED BENEFITS [CLOSING OF ACCOUNTS]. (a)
60-11 If a person's membership in the retirement system has terminated
60-12 and a valid application for a retirement [an] annuity or [for] a
60-13 refund of [the] accumulated contributions [of a former member whose
60-14 membership has terminated under Section 842.109(a)(1)] has not been
60-15 filed with the retirement system [before the end of the year in
60-16 which the member dies], the retirement system shall mail the notice
60-17 described by Subsection (b) [(d)] to the most recent address of the
60-18 former member [decedent's beneficiary] as shown on system records
60-19 and [or, if there is none, to the decedent's most recent address as
60-20 shown on system records. If the notice is returned undelivered,
60-21 the retirement system will] make reasonable efforts to locate any
60-22 person entitled to apply for the benefit. [the beneficiary or
60-23 personal representative. If a valid application for an annuity or
60-24 for a refund of the accumulated contributions of a deceased member
60-25 is not filed with the retirement system before the expiration of
60-26 180 days after the date the notice is sent, the retirement system
60-27 shall transfer the accumulated contributions in the decedent's
61-1 individual account in the employees saving fund to the perpetual
61-2 endowment account of the endowment fund and close the decedent's
61-3 account.]
61-4 [(b) On termination of a person's membership under Section
61-5 842.109(a)(4), the retirement system shall mail the notice
61-6 described by Subsection (d) to the former member's most recent
61-7 address as shown on system records. If the notice is returned
61-8 undelivered, the retirement system will make reasonable efforts to
61-9 locate the former member. If a valid application for a refund of
61-10 the accumulated contributions of the former member is not filed
61-11 with the retirement system before the expiration of 180 days after
61-12 the date the notice is sent, the retirement system shall transfer
61-13 the accumulated contributions in the former member's individual
61-14 account in the employees saving fund to the perpetual endowment
61-15 account of the endowment fund and close the former member's
61-16 account.]
61-17 [(c) If a valid application for retirement or for a refund
61-18 of the accumulated contributions of a member who is no longer in
61-19 covered employment is not filed with the retirement system before
61-20 the end of the later of the year in which the member reaches age
61-21 70-1/2 or the year in which the member terminates covered
61-22 employment, the retirement system shall mail the notice described
61-23 by Subsection (d) to the member at the member's most recent address
61-24 as shown on system records. If the notice is returned undelivered,
61-25 the retirement system will make reasonable efforts to locate the
61-26 member. If a valid application for retirement or for a refund of
61-27 the accumulated contributions of the member is not filed with the
62-1 retirement system before March 15 of the year in which distribution
62-2 must be made under Section 841.010, the person's membership
62-3 terminates as of March 31 of that year, and the retirement system
62-4 shall transfer the accumulated contributions in the member's
62-5 individual account in the employees saving fund to the perpetual
62-6 endowment account of the endowment fund and close the member's
62-7 account.]
62-8 (b) [(d)] A notice under this section must include the name
62-9 of the [member or] former member, the name of each subdivision with
62-10 [from] which the former member has an individual account, a
62-11 statement that no additional interest is credited after a
62-12 membership has terminated [person received service credit], a
62-13 statement that a benefit is currently payable, a statement of the
62-14 procedure for obtaining payment of that benefit, and a statement
62-15 that a failure to file a valid application for benefits may cause
62-16 unclaimed benefits to be forfeited to the retirement system.
62-17 (c) [(e)] If a person files with the retirement system a
62-18 valid application for an annuity [retirement] based on a membership
62-19 that terminated under Section 842.109(b) [an account that has been
62-20 closed under Subsection (a) or (c)], the retirement system shall
62-21 [restore the member's individual account in the employees saving
62-22 fund and] pay an [a retirement] annuity computed as of the date on
62-23 which the annuity would have been required to begin under this
62-24 subtitle.
62-25 (d) An applicant who is the former member may select the
62-26 standard service retirement annuity or an optional service
62-27 retirement annuity under Section 844.104. An applicant who is the
63-1 surviving spouse of the former member may select an optional
63-2 service retirement annuity under Section 844.104. If the applicant
63-3 is not the former member or surviving spouse, the annuity will be
63-4 computed as an annuity under Section 844.104(c)(7). All annuity
63-5 payments that previously would have been paid if the annuity had
63-6 begun on the date required under this subtitle will be paid to the
63-7 applicant [person as a single sum].
63-8 (e) [(f)] If a person files with the retirement system a
63-9 valid application for a refund of a former member's accumulated
63-10 contributions [based on an account that has been closed under
63-11 Subsection (a), (b), or (c)], the retirement system shall pay to
63-12 the applicant the amount of the former member's accumulated
63-13 contributions [from the perpetual endowment account of the
63-14 endowment fund the amount] to which the applicant is entitled.
63-15 (f) [(g)] If a person receiving an annuity fails to
63-16 negotiate more than five consecutive annuity payments, the
63-17 retirement system may send a notice to that person, stating that
63-18 unless the previous payments are negotiated not later than the 30th
63-19 day [within 30 days] after the date of the notice, payment of
63-20 benefits will be suspended [and the account closed until the person
63-21 files a written request with the retirement system to resume
63-22 payments]. After receipt of a valid application [written request
63-23 under this subsection], the retirement system shall [will] resume
63-24 making monthly payments. All annuity payments that would have
63-25 otherwise been paid if the annuity had not been suspended will be
63-26 paid to the person or, if the person has died, to the decedent's
63-27 beneficiary or, if no beneficiary exists, to the annuitant's estate
64-1 [as a single sum].
64-2 (g) If a benefit becomes payable as the result of [(h) On]
64-3 the death of a person receiving an annuity, the retirement system
64-4 shall mail a notice similar to the notice described by Subsection
64-5 (b) to the most recent address of the decedent's beneficiary as
64-6 shown on system records and make reasonable efforts to locate each
64-7 [any] person to whom the benefit is payable [annuity payments
64-8 should continue to be made as a result of that death and to notify
64-9 that person of any information necessary in order to make the
64-10 continued payments]. After receipt of a valid application, the
64-11 retirement system shall pay the applicant the benefit to which the
64-12 applicant is entitled. All annuity payments that would previously
64-13 have been paid if the annuity had begun on the date required under
64-14 this subtitle will be paid to the applicant. [If the requested
64-15 information has not been received by the retirement system before
64-16 the expiration of one year after the annuitant's death, the
64-17 retirement system shall suspend the annuity and close the account
64-18 until all requested information has been received by the retirement
64-19 system. After the retirement system receives the requested
64-20 information, it will resume making monthly payments of the annuity
64-21 and pay in a single sum all payments that were suspended.]
64-22 [(i) The retirement system may apply a similar process as
64-23 provided by Subsection (a), (b), (c), (d), (e), or (f) to other
64-24 money it holds for payment, if the system first determines that no
64-25 claim for the money is likely to be filed.]
64-26 (h) A person entitled to a benefit under this section is
64-27 solely responsible for a tax or penalty relating to the
65-1 distribution of the benefit without regard to whether the person
65-2 received notice from the retirement system.
65-3 (i) The board of trustees may adopt rules concerning the
65-4 notice, distribution, management, transfer, and administration of
65-5 unclaimed benefits and the authority of an applicant to act as
65-6 trustee of an absent beneficiary in the selection of a payment
65-7 option or receipt of an absent beneficiary's benefit under this
65-8 section.
65-9 SECTION 53. (a) Section 844.504, Government Code, as amended
65-10 by this Act, applies only to the death of a retiree occurring after
65-11 December 31, 2001. Section 844.504, Government Code, as it existed
65-12 immediately before the enactment of this Act, applies to deaths
65-13 that occurred on or before that date.
65-14 (b) Sections 844.005 and 844.503, Government Code, as
65-15 amended by this Act, apply only to benefits that become payable
65-16 after December 31, 2001.
65-17 (c) Sections 844.401 and 844.402, Government Code, as
65-18 amended by this Act, apply only to beneficiary determinations made
65-19 after December 31, 2001.
65-20 SECTION 54. The following provisions of the Government Code
65-21 are repealed:
65-22 (1) Section 843.301;
65-23 (2) Section 844.009(i);
65-24 (3) Sections 844.104(d), (e), (f), (g), (h), (i), (j),
65-25 (k), (l), (m), and (n);
65-26 (4) Sections 844.305(d), (e), (f), (g), (h), (i), (j),
65-27 (k), (l), and (m);
66-1 (5) Section 844.403; and
66-2 (6) Section 844.502(c).
66-3 SECTION 55. (a) Except as provided by Subsection (b) of this
66-4 section, this Act takes effect December 31, 2001.
66-5 (b) Sections 12 and 51 of this Act take effect September 1,
66-6 2001.