1-1 By: Armbrister S.B. No. 523
1-2 (In the Senate - Filed February 2, 2001; February 5, 2001,
1-3 read first time and referred to Committee on Intergovernmental
1-4 Relations; March 1, 2001, reported favorably by the following vote:
1-5 Yeas 7, Nays 0; March 1, 2001, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to participation and credit in, contributions to, and
1-9 benefits and administration of the Texas County and District
1-10 Retirement System.
1-11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-12 SECTION 1. Section 841.001, Government Code, is amended to
1-13 read as follows:
1-14 Sec. 841.001. DEFINITIONS. In this subtitle:
1-15 (1) "Actuarial equivalent" means a benefit that, at
1-16 the time it is begun [entered upon], has the same present value as
1-17 the benefit it replaces, based on seven percent annual interest and
1-18 the mortality table published by the Conference of Actuaries in
1-19 Public Practice and known as the UP-1984 table with an age setback
1-20 of five years for retired or disabled annuitants and an age setback
1-21 of 10 years for beneficiaries, with a 30-percent reserve refund
1-22 assumption for the standard benefit.
1-23 (2) "Accumulated contributions" means the
1-24 contributions, other member deposits, and interest credited to a
1-25 member's individual account in the employees saving fund. ["Annual
1-26 compensation" means the compensation that is paid to an employee of
1-27 a participating subdivision by the subdivision that does not exceed
1-28 the rate of compensation fixed by the subdivision governing body as
1-29 the maximum compensation for a year on which contributions by the
1-30 employee to the retirement system may be based.]
1-31 (3) "Annuity" means an amount of money payable in
1-32 equal monthly installments at the end of each month for a period
1-33 determined under this subtitle.
1-34 (4) "Beneficiary" means an individual or entity
1-35 designated by a member or annuitant or by statute to receive a
1-36 benefit payable under this subtitle because of the death of a
1-37 member or an annuitant. The term does not include an "alternate
1-38 payee" as defined by Section 804.001.
1-39 (5) "Board of trustees" means the persons appointed
1-40 under this subtitle to administer the retirement system.
1-41 (6) [(5)] "Compensation" means the payments on which
1-42 contributions by an employee to the retirement system are based
1-43 that do not exceed $150,000 in a calendar year, indexed in the same
1-44 manner as is provided by Section 401(a)(17) of the Internal Revenue
1-45 Code of 1986 (26 U.S.C. Section 417) and that are made to an
1-46 employee of a participating subdivision by the subdivision for
1-47 service, including nonmonetary compensation, the value of which is
1-48 determined by the governing body of the subdivision. The term does
1-49 not include workers' compensation benefits received by a member
1-50 under Section 504.011, Labor Code.
1-51 (7) "Credited service" means the number of months of
1-52 prior and current service ascribed to a member in the retirement
1-53 system or included in a prior service certificate in effect for the
1-54 member.
1-55 (8) [(6)] "Employee" means a person, other than a
1-56 temporary employee, who is certified by a subdivision as being
1-57 employed in, or elected or appointed to, a position or office in
1-58 the subdivision that normally requires services from the person for
1-59 not less than 900 hours a year and for which the person is
1-60 compensated by the subdivision. The term includes a person
1-61 employed on a probationary basis except as provided by Section
1-62 842.107 [842.107(c)].
1-63 (9) [(7)] "Governing body" means the commissioners
1-64 court of a county or, in any other subdivision, the body that is
2-1 authorized to raise and expend revenue.
2-2 (10) [(8)] "Initial deposit rate" means the percentage
2-3 of the annual compensation of an employee of a participating
2-4 subdivision that is required by the subdivision on the effective
2-5 date of subdivision participation in the retirement system as the
2-6 rate for employee contributions to the retirement system.
2-7 (11) [(9)] "Local pension system" means a public
2-8 retirement benefit program of less than statewide scope.
2-9 (12) [(10)] "Retirement" means the withdrawal from
2-10 service with a retirement benefit granted under this subtitle.
2-11 (13) "Retirement annuity" means the service,
2-12 disability, or survivor benefit paid under this subtitle in the
2-13 form of an annuity.
2-14 (14) [(11)] "Retirement system" means the Texas County
2-15 and District Retirement System.
2-16 (15) [(12)] "Service" means the time a person is an
2-17 employee.
2-18 (16) "Service credit" means the monetary credits
2-19 allowed a member for service for a participating subdivision.
2-20 (17) [(13) "Credited service" means the number of
2-21 months of prior and current service ascribed to a member in the
2-22 retirement system or included in a prior service certificate in
2-23 effect for the member.]
2-24 [(14)] "Subdivision" means a county, a political unit
2-25 that consists of all of the geographical area of one county or of
2-26 all or part of more than one county, a political unit of a county
2-27 that has taxing authority, an authority created by the state [State
2-28 of Texas] to conduct redevelopment activities on or related to
2-29 closed military installations of the United States, a crime control
2-30 and prevention district, the Texas Association of Counties, the
2-31 Texas County and District Retirement System, or a city and county
2-32 that jointly operate a city-county hospital under Subchapter B,
2-33 Chapter 265, Health and Safety Code, but does not include an
2-34 incorporated city or town, a school district, or a junior college
2-35 district.
2-36 (18) "Supplemental death benefit program" means the
2-37 optional death benefit program established under Subchapter F,
2-38 Chapter 844.
2-39 (19) [(15)] "Temporary employee" means a person who is
2-40 scheduled to hold a position for less than six months and only:
2-41 (A) until another person can be hired;
2-42 (B) for the duration of a project scheduled to
2-43 end less than six months after the date of hiring;
2-44 (C) until a specific date less than six months
2-45 after the date of hiring; or
2-46 (D) until a volume of work is completed that is
2-47 estimated to be completed in less than six months after the date of
2-48 hiring.
2-49 (20) [(16)] "Supplemental death benefit program" means
2-50 the voluntary, employer-funded optional death benefits program
2-51 under Subchapter F, Chapter 844. The program constitutes
2-52 "group-term life insurance purchased for employees" as described by
2-53 Section 79 of the Internal Revenue Code of 1986.
2-54 (21) [(17)] "Vested member" means a member who may
2-55 withdraw from employment with all participating subdivisions, leave
2-56 the member's accumulated contributions on deposit with the
2-57 retirement system, and, on meeting the age and length-of-service
2-58 requirements for service retirement, file an application for
2-59 retirement and begin to receive a service retirement annuity
2-60 [benefit].
2-61 SECTION 2. Section 841.008, Government Code, is amended to
2-62 read as follows:
2-63 Sec. 841.008. APPLICATIONS BY, AND PAYMENTS TO, PERSONS
2-64 OTHER THAN MEMBERS, BENEFICIARIES, AND ANNUITANTS [THE MEMBER].
2-65 (a) The board of trustees may accept an application for any
2-66 benefit under this subtitle that is signed on behalf of a person
2-67 entitled to the benefit [the member] by:
2-68 (1) an [a duly] appointed guardian of the person and
2-69 estate of the person [member]; or
3-1 (2) an attorney in fact [a person] authorized to act
3-2 on behalf of the person [member] by a written power of attorney
3-3 that provides that the power is not revoked by disability of the
3-4 person [member], except that an attorney in fact who is not the
3-5 person's spouse may not select a benefit in which the attorney in
3-6 fact is a named beneficiary, unless the attorney in fact designates
3-7 as the person's beneficiary each individual who would be entitled
3-8 to the entire benefit if the person had died intestate [is the
3-9 spouse of the member].
3-10 (b) If it is made to appear to the director by affidavit of
3-11 a [duly] licensed physician that a person entitled to a benefit
3-12 [member] is not mentally capable of managing the person's
3-13 [member's] own affairs, and if it is further established to the
3-14 satisfaction of the director that the estate of the person [member]
3-15 is insufficient to justify the expense of establishing a
3-16 guardianship or continuing a guardianship after letters of
3-17 guardianship have expired, the director may make payment of any
3-18 annuity or other benefit:
3-19 (1) to the spouse of the person [member], as trustee
3-20 for the person [member]; or
3-21 (2) [if there is no spouse,] to an individual or
3-22 entity [a person] actually providing for the needs of and caring
3-23 for the person [member], as trustee for the person until current
3-24 letters of guardianship are filed with the retirement system
3-25 [member].
3-26 (c) If requested by the person entitled to the benefit or
3-27 the guardian, attorney in fact, or trustee of the person, the
3-28 director may, if the director determines that it is in the best
3-29 interest of the person entitled to the benefit, make payments
3-30 directly to the trustee of:
3-31 (1) a trust described by Section 867, Texas Probate
3-32 Code, that has been created for the management of guardianship
3-33 funds for the benefit of the person; or
3-34 (2) a trust described by 42 U.S.C. Section
3-35 1396p(d)(4)(A), (B), or (C) that has been established to qualify
3-36 the person for benefits or other assistance under a state or
3-37 federal program or to supplement the benefits or other assistance
3-38 provided under the program.
3-39 (d) The director may require proof of [such] facts used to
3-40 establish a right under this section by evidence the director
3-41 determines is satisfactory [to the director].
3-42 SECTION 3. Section 841.010, Government Code, is amended to
3-43 read as follows:
3-44 Sec. 841.010. DISTRIBUTION REQUIREMENTS. (a)
3-45 Notwithstanding any other provision of this subtitle, all
3-46 distributions under this subtitle must be determined and made in
3-47 accordance with Section 401(a)(9) of the Internal Revenue Code of
3-48 1986 (26 U.S.C. Section 401) and the regulations adopted under that
3-49 provision, including the minimum incidental death benefit
3-50 distribution requirement of Section 401(a)(9)(G) of that code. The
3-51 board of trustees may adopt rules relating to the selection,
3-52 payment, and distribution of benefits to ensure compliance with
3-53 federal statutes and regulations.
3-54 (b) The entire vested interest of a participant must be
3-55 distributed or begin to be distributed not later than April 1
3-56 following the later of the year in which the participant attains
3-57 age 70-1/2 or the year in which the participant separates from
3-58 service with all participating subdivisions. If the participant
3-59 dies after distribution of the participant's interest has begun,
3-60 the remaining portion of the interest will continue to be
3-61 distributed at least as rapidly as the method of distribution being
3-62 used before the participant's death. If the participant dies
3-63 before distribution of the participant's interest begins,
3-64 distribution of the participant's entire interest must be made in a
3-65 manner complying with Section 401(a)(9)(B) of the code.
3-66 SECTION 4. Section 841.101, Government Code, is amended by
3-67 adding a new Subsection (c) and redesignating current Subsection
3-68 (c) as Subsection (d) to read as follows:
3-69 (c) A person commits an offense if the person knowingly
4-1 fails to return money received from the retirement system to which
4-2 the person is not entitled.
4-3 (d) An offense under this section is a misdemeanor
4-4 punishable by a fine of not less than $100 nor more than $1,000, by
4-5 confinement in jail for not less than 30 days nor more than one
4-6 year, or both.
4-7 SECTION 5. Section 842.002, Government Code, is amended to
4-8 read as follows:
4-9 Sec. 842.002. RULES FOR PARTICIPATING SUBDIVISIONS. The
4-10 board of trustees may adopt rules concerning:
4-11 (1) notices, information, and reports the board of
4-12 trustees requires from a subdivision that elects to participate in
4-13 the retirement system; [and]
4-14 (2) the time that a subdivision that elects to
4-15 participate in the retirement system may begin participation; and
4-16 (3) the powers and duties of a participating
4-17 subdivision to adopt orders or resolutions, make elections, and
4-18 otherwise exercise decision-making authority concerning the rights
4-19 and benefits of the members and annuitants under a plan adopted or
4-20 assumed by the subdivision.
4-21 SECTION 6. Subsections (a) and (d), Section 842.004,
4-22 Government Code, are amended to read as follows:
4-23 (a) A [If a] subdivision [is] participating in the
4-24 retirement system [on a full salary basis, the subdivision] may
4-25 elect to participate in the supplemental death benefits fund.
4-26 (d) A subdivision that elects to participate in the fund
4-27 [after the operative date of the fund] may begin participation on
4-28 the first day of any month after the month in which the subdivision
4-29 gives notice of its election to the board of trustees.
4-30 SECTION 7. Section 842.104, Government Code, is amended by
4-31 amending Subsection (a) and adding Subsection (e) to read as
4-32 follows:
4-33 (a) If a county elects to participate in the retirement
4-34 system, the commissioners court of the county may elect to deny
4-35 membership to the employees of a county hospital governed by
4-36 Chapter 263, Health and Safety Code [5, Title 71, Revised
4-37 Statutes].
4-38 (e) The commissioners court is the governing body of a
4-39 county hospital for the purposes of this subtitle.
4-40 SECTION 8. Sections 842.106, 842.107, 842.108, 842.109,
4-41 842.110, and 842.111, Government Code, are amended to read as
4-42 follows:
4-43 Sec. 842.106. MULTIPLE RETIREMENT SYSTEM MEMBERSHIP. (a) A
4-44 [Except as provided by this section, a] person who is an employee
4-45 eligible for membership and [is] eligible to receive credit in this
4-46 retirement system for service performed for a participating
4-47 subdivision is not eligible for credit for that service in another
4-48 public [pension fund or] retirement system described by Section
4-49 801.001 that is at least partly supported by the subdivision at
4-50 public expense. It is the responsibility of the subdivision to
4-51 enforce this provision.
4-52 (b) A person may simultaneously be a member of this
4-53 retirement system and another state or local retirement system
4-54 authorized under Section 67, Article XVI, Texas Constitution.
4-55 However, a person may receive a benefit from this system only to
4-56 the extent that the amount of the benefit is computed solely on the
4-57 member's compensation and accumulated contributions in the system.
4-58 Service credited by another retirement system may not be used to
4-59 determine eligibility for a benefit in this retirement system
4-60 except as provided by Chapter 803[, and receive credit for service
4-61 performed during the same period in the retirement system, the
4-62 federal program providing old age and survivors insurance, the
4-63 Employees Retirement System of Texas if the service is performed by
4-64 a prosecuting attorney, and either the Judicial Retirement System
4-65 of Texas Plan One or the Judicial Retirement System of Texas Plan
4-66 Two].
4-67 [(c) In this section, "prosecuting attorney" means a person
4-68 who holds the office of district attorney, criminal district
4-69 attorney, or county attorney performing the duties of a district
5-1 attorney and who is compensated by the state in an amount set by
5-2 appropriation.]
5-3 Sec. 842.107. EXCEPTION TO GENERAL MEMBERSHIP REQUIREMENT.
5-4 [(a) If on the date a subdivision's participation in the
5-5 retirement system becomes effective a person has a basis of
5-6 employment with the subdivision that would be violated by a
5-7 membership requirement of this subchapter, the person may elect not
5-8 to become a member of the retirement system.]
5-9 [(b) If a person qualified to make an election under this
5-10 section has been notified that the subdivision will begin
5-11 participation in the retirement system, the person is considered to
5-12 have elected membership in the retirement system unless before the
5-13 date the subdivision's participation becomes effective the person
5-14 files with the governing body of the subdivision written notice of
5-15 an election not to become a member.]
5-16 [(c)] A subdivision that was participating in the retirement
5-17 system before January 1, 1987, and that had in effect before that
5-18 date and continues to have a policy of hiring new personnel on a
5-19 probationary basis for a specified period may exclude new personnel
5-20 from membership during the probationary period but may not, for
5-21 purposes of retirement system membership, increase the length of
5-22 the probationary period beyond the length of the period in effect
5-23 on January 1, 1987. The subdivision may reduce or eliminate the
5-24 period.
5-25 Sec. 842.108. WITHDRAWAL OF ACCUMULATED CONTRIBUTIONS.
5-26 (a) A person, or the beneficiary of a person, whose membership
5-27 terminated as a result of absence from service may submit an
5-28 application to withdraw all of the person's accumulated
5-29 contributions [who is not an employee of any participating
5-30 subdivision and who has not retired may, by written application,
5-31 withdraw from membership in the retirement system, and the person's
5-32 account will be closed and the person will be paid:]
5-33 [(1) the accumulated contributions in the member's
5-34 individual account in the employees saving fund; plus]
5-35 [(2) interest computed from the beginning of the
5-36 calendar year of withdrawal through the end of the month before the
5-37 month in which withdrawal occurs on the balance in the member's
5-38 individual account in the employees saving fund on January 1 of the
5-39 year of withdrawal].
5-40 (b) A member who has separated from employment with a
5-41 participating subdivision may submit an application to withdraw the
5-42 member's accumulated contributions attributable to service with
5-43 that subdivision. A withdrawal cancels the person's credited
5-44 service and service credit attributable to service with that
5-45 subdivision on the date the retirement system makes payment of any
5-46 portion of the member's accumulated contributions. Credited
5-47 service that has been canceled may not be used to determine
5-48 eligibility for a later retirement unless it is reestablished under
5-49 Section 843.003.
5-50 (c) Interest is computed on the balance in the member's
5-51 individual account in the employees saving fund on January 1 of the
5-52 year of withdrawal through the month before the month in which the
5-53 withdrawal occurs for a person described by Subsection (b) and on
5-54 January l of the year of membership termination through the month
5-55 before the month in which the membership terminates for a person
5-56 described by Subsection (a) whose membership terminates after
5-57 December 31, 1999.
5-58 (d) If a person eligible to receive [to whom] a withdrawal
5-59 [would be paid] under this section or Section 844.401 elects to
5-60 have all or a portion of the accumulated contributions paid
5-61 directly to an eligible retirement plan and specifies the [eligible
5-62 retirement] plan to which the contributions are to be paid on forms
5-63 approved [for that purpose] by the board of trustees, the
5-64 retirement system shall make the payment in the form of a direct
5-65 trustee-to-trustee transfer but is under no obligation to determine
5-66 whether the other plan in fact is an eligible retirement plan for
5-67 that purpose.
5-68 Sec. 842.109. TERMINATION OF MEMBERSHIP. (a) A person
5-69 terminates membership in the retirement system by:
6-1 (1) death;
6-2 (2) retirement from all participating subdivisions
6-3 with which the person has service credit;
6-4 (3) withdrawal of all of the person's accumulated
6-5 contributions [while absent from service]; or
6-6 (4) absence from service for five consecutive years
6-7 before accumulating four or more years of credited service.
6-8 (b) A person's membership in the retirement system may not
6-9 extend beyond March 31 of the year following the later of the year
6-10 in which the person attains age 70-1/2 or the year in which the
6-11 person is no longer an employee of any participating subdivision.
6-12 (c) A member of the retirement system who [is not absent
6-13 from service and continues to accumulate membership credited
6-14 service if the person] leaves employment with a participating
6-15 subdivision to perform and does perform qualified military service
6-16 in the uniformed services, as that term is defined in the Uniformed
6-17 Services Employment and Reemployment Rights Act of 1994 (38 U.S.C.
6-18 Section 4301 et seq.), that meets the requirements of that Act is
6-19 not absent from service and continues to accumulate credited
6-20 service with that subdivision if:
6-21 (1) the person applies for reemployment with the same
6-22 subdivision not later than the 90th day after the date the person
6-23 is discharged from military service under honorable conditions or
6-24 released from hospitalization continuing after being discharged
6-25 under honorable conditions for a period of not more than two years;
6-26 and
6-27 (2) the person is reemployed by the same participating
6-28 subdivision.
6-29 (d) [(c)] On any termination of membership in the retirement
6-30 system, a person forfeits all credited service established in the
6-31 retirement system.
6-32 Sec. 842.110. RESUMPTION OF SERVICE WITH SAME EMPLOYER BY
6-33 RETIREE. (a) In this section, "reemploying subdivision" is a
6-34 subdivision for which a person previously has performed creditable
6-35 service and is receiving or would receive a retirement annuity
6-36 except for this section.
6-37 (b) A person who has retired with a service retirement
6-38 annuity [benefit] under this subtitle shall, if the person later
6-39 becomes an employee of a reemploying subdivision, become a member
6-40 of the system on the date of reemployment, but credits and benefits
6-41 payable [allowable] to the person under this subtitle are limited
6-42 as provided by this section.
6-43 (c) [(b)] The retirement system shall [discontinue and]
6-44 suspend payments of each service retirement annuity allowed because
6-45 of the person's previous service with a reemploying subdivision,
6-46 beginning with the month the retirement system determines that the
6-47 person has resumed employment with the reemploying subdivision.
6-48 After the determination, the retirement system may not make
6-49 payments of the annuity for any month during which the person
6-50 remains an employee of the reemploying subdivision. The retirement
6-51 system shall transfer annuity payments that become due and would be
6-52 payable to the retiree except for the suspension to a
6-53 non-interest-bearing account in the endowment fund. The suspension
6-54 of a benefit under this section does not suspend payment of a
6-55 benefit to an alternate payee under a qualified domestic relations
6-56 order.
6-57 (d) The retirement system shall establish an individual
6-58 account for the member in the employees saving fund for accumulated
6-59 contributions credited after reemployment with the subdivision.
6-60 After terminating employment with the reemploying subdivision, a
6-61 member may elect either an additional standard or optional service
6-62 retirement annuity based on the additional service with the
6-63 reemploying subdivision or a refund of the member's accumulated
6-64 contributions since reemployment [(c) Member contributions under
6-65 Section 845.403 shall be made on all compensation paid to the
6-66 employee by the subdivision at the same rate as required of other
6-67 employees of the subdivision. The contributions shall be deposited
6-68 by the retirement system on receipt in an individual account for
6-69 the member in the employees saving fund and shall be credited with
7-1 interest annually at the same rate and manner as are the accounts
7-2 of other members. The compensation paid to the employee by the
7-3 subdivision shall be included in computing the monthly
7-4 contributions the subdivision makes to the subdivision accumulation
7-5 fund].
7-6 (e) [(d)] After termination of employment with the
7-7 reemploying subdivision [all participating subdivisions] and
7-8 [after] filing with the retirement system [of] an application for
7-9 resumption of the suspended annuity [retirement with the board of
7-10 trustees], a person described by Subsection (b) [(a)] is entitled
7-11 to receive the payments of the suspended annuity that had been
7-12 transferred to the endowment fund and future payments of the
7-13 suspended annuity[, as provided by Subsection (e), and to the
7-14 additional benefits as provided by Subsections (f) and (g)].
7-15 (f) Beginning with [(e) Monthly payments of the suspended
7-16 annuity shall be resumed in] the month following the month in which
7-17 a retiree's employment is terminated with a reemploying subdivision
7-18 by death or other separation from service, future payments of the
7-19 suspended annuity become payable to each person entitled to the
7-20 annuity in the same amounts that would be payable if the annuity
7-21 had not been suspended [all participating subdivisions, without
7-22 change in the amount except for any increase allowed under Section
7-23 844.208 or the duration of or other condition pertaining to the
7-24 suspended benefit. Payment of the resumed benefit may not be made
7-25 for any month during which the payment was suspended under this
7-26 section].
7-27 (g) [(f)] If a person with credited service under this
7-28 section dies before a payment under Subsection (e) [(g)] is made,
7-29 monthly payments of a suspended annuity will resume under the terms
7-30 of the retirement annuity originally selected by the decedent, or a
7-31 person may make an election under Subsection (d) in the order of
7-32 preference provided by Section 844.407 [the person's beneficiary,
7-33 or if there is no beneficiary surviving, the person's spouse, or if
7-34 there is no surviving spouse, the executor or administrator of the
7-35 person's estate, may elect payment as provided by Section 844.407].
7-36 [(g) The additional service retirement benefit allowable to
7-37 a person to whom this section applies is, at the option of that
7-38 person, either a refund of accumulated contributions made since
7-39 reemployment plus any accrued interest on the accumulated
7-40 contributions allowed by the retirement system or a benefit
7-41 consisting of a basic annuity actuarially determined from the sum
7-42 of the member's deposits made and accumulated since the date of
7-43 last becoming a member and current service credit computed on the
7-44 amount of the deposits and a supplemental annuity actuarially
7-45 determined from the multiple matching credit applicable to the
7-46 amount of contributions made and accumulated with interest in the
7-47 person's individual account since last becoming a member. The
7-48 additional benefit is payable as a standard service retirement
7-49 benefit or, at the election of the member, any optional benefit
7-50 authorized under this subtitle that is the actuarial equivalent of
7-51 the standard retirement benefit. The first benefit payment date
7-52 under this section is the later of the end of the month following
7-53 the last month of employment or the end of the first month that
7-54 ends after the expiration of 45 days since the date the person
7-55 filed an application for payment. The first payment may not be
7-56 made if the person has resumed employment with a reemploying
7-57 subdivision in a position that would make the person an employee.]
7-58 [(h) If a person becomes an employee of a reemploying
7-59 subdivision within one calendar month after that person's effective
7-60 date of retirement from that reemploying subdivision, the person is
7-61 considered not to have retired, and the person's membership shall
7-62 be restored. The retirement system shall deduct the sum of
7-63 one-half of the basic annuity payments made before the membership
7-64 is restored from the person's individual account in the employees
7-65 saving fund and shall transfer that amount to the current service
7-66 annuity reserve fund. The retirement system shall reduce the
7-67 person's maximum prior service credit by an amount equal to the sum
7-68 of the prior service annuity payments made before the membership is
7-69 restored, divided by the product of the subdivision's allocated
8-1 prior service credit percentage multiplied by the interest factor
8-2 for interest from the subdivision's participation date to the
8-3 person's effective retirement date, both of which were used in
8-4 computing the amount of the prior service annuity.]
8-5 [(i) In this section, "reemploying subdivision" is a
8-6 subdivision for which a person previously has performed creditable
8-7 service and is receiving or would receive a retirement benefit
8-8 except for this section.]
8-9 Sec. 842.111. RESUMPTION OF SERVICE WITH DIFFERENT EMPLOYER
8-10 BY RETIREE. (a) If a person becomes an employee of a
8-11 participating subdivision after beginning to receive a service
8-12 retirement annuity [benefit], no portion of which is based on
8-13 service with that subdivision, the person resumes membership in the
8-14 retirement system without suspension of the person's retirement
8-15 annuity.
8-16 (b) After terminating employment with a participating
8-17 subdivision, a member described by Subsection (a) is eligible to
8-18 apply for and receive an additional standard or optional service
8-19 retirement annuity or a refund of the member's accumulated
8-20 contributions based on service with the subdivision, without regard
8-21 to any age or credited service requirement. [Member contributions
8-22 under Section 845.403 shall be made on all compensation paid to the
8-23 employee by the subdivision at the same rate as is required of
8-24 other employees of the subdivision. The retirement system shall
8-25 deposit the contributions on receipt in an individual account for
8-26 the member in the employees saving fund and shall credit the
8-27 account with interest at the same rate and in the same manner as
8-28 the accounts of other members are credited. The compensation paid
8-29 to the employee by the subdivision shall be included in computing
8-30 the monthly contributions the subdivision makes to the subdivision
8-31 accumulation fund.]
8-32 (c) On the death of a member described by Subsection (a), a
8-33 person may apply for and receive an optional service retirement
8-34 annuity or a refund of the decedent's accumulated contributions
8-35 with the subdivision, without regard to any age or credited service
8-36 requirement. [If a person with credited service under this section
8-37 dies before a payment under Subsection (d) is made, the person's
8-38 beneficiary or, if no beneficiary survives, the person's spouse, or
8-39 if there is no surviving spouse, the executor or administrator of
8-40 the person's estate, may elect payment as provided by Section
8-41 844.407.]
8-42 [(d) The additional service retirement benefit allowable to
8-43 a person to whom this section applies is, at the option of that
8-44 person, either a refund of accumulated contributions made since
8-45 reemployment plus any accrued interest on the accumulated
8-46 contributions allowed by the retirement system or a benefit
8-47 consisting of a basic annuity actuarially determined from the sum
8-48 of the member's deposits made and accumulated since the date of
8-49 last becoming a member and current service credit computed on the
8-50 amount of the deposits and a supplemental annuity actuarially
8-51 determined from the multiple matching credit applicable to the
8-52 amount of contributions made and accumulated with interest in the
8-53 person's individual account since last becoming a member. The
8-54 additional benefit is payable as a standard service retirement
8-55 benefit or, at the election of the member, any optional benefit
8-56 authorized under this subtitle that is the actuarial equivalent of
8-57 the standard retirement benefit. The first benefit payment date
8-58 under this section is the later of the end of the month following
8-59 the last month of employment or the end of the first month that
8-60 ends after the expiration of 45 days since the date the person
8-61 filed an application for payment. The first payment may not be
8-62 made if the person has resumed employment that would result in
8-63 suspension of a benefit.]
8-64 [(e) If a person becomes an employee of a subdivision after
8-65 beginning to receive a retirement benefit, no portion of which
8-66 benefit is based on service with that subdivision, and the person's
8-67 service retirement annuity is suspended under Section 842.110, as
8-68 it existed at the time service is resumed, the person may, on
8-69 written application to the retirement system, resume receiving the
9-1 suspended annuity.]
9-2 SECTION 9. Subsections (b), (j), and (k), Section 842.112,
9-3 Government Code, are amended to read as follows:
9-4 (b) Except as provided by Subsection (j) or Section 843.005,
9-5 a [A] correction may not be made as to current service performed,
9-6 or current service credit that should have been received, more than
9-7 four years before the date an application, on forms approved by the
9-8 retirement system's board of trustees, for the correction is
9-9 received by the retirement system.
9-10 (j) If, as a result of a suit against a participating
9-11 subdivision in a court of competent jurisdiction or as a result of
9-12 a complaint or grievance against a participating subdivision filed
9-13 with the United States Equal Employment Opportunity Commission, the
9-14 Commission on Human Rights, or a county civil service commission, a
9-15 judgment or order is issued or a settlement agreement is executed,
9-16 the terms of which require that an employee receive back pay or
9-17 that a person be employed or reemployed for a specified period[, a
9-18 person receives a judgment against a subdivision ordering that the
9-19 person be reinstated as an employee of the subdivision
9-20 retroactively to the date the person's employment was terminated]
9-21 and require [ordering] that the person receive service credit
9-22 toward retirement based on the back pay or both service credit and
9-23 credited service for the specified period of employment or
9-24 reemployment [for the reinstated service], on written application
9-25 to the retirement system, the system shall grant the service credit
9-26 and credited service if:
9-27 (1) the judgment or order has become final and is no
9-28 longer subject to appeal;
9-29 (2) a certified copy of the judgment, order, or
9-30 settlement agreement accompanies the application;
9-31 (3) the retirement system receives payment on behalf
9-32 of [from] the person in an amount equal to the contributions the
9-33 person would have made to the system if the back pay or additional
9-34 service [employment] had [not] been [terminated and the service]
9-35 reported to the system; and
9-36 (4) the retirement system receives payment from the
9-37 subdivision in an amount equal to the additional contributions that
9-38 the subdivision would have made to the system for the additional
9-39 [credited] service credit.
9-40 (k) If a person to whom Subsection (j) applies has forfeited
9-41 service credit as a result of withdrawal of contributions during
9-42 the time between the termination of employment and the date of
9-43 reinstatement, the person is eligible to reestablish credit under
9-44 Section 843.003. For purposes of this subsection, forfeited credit
9-45 based on service performed for more than one participating
9-46 subdivision is considered to have been credit for service performed
9-47 only for the subdivision that is subject to the judgment, order, or
9-48 settlement agreement, except that credit may not be reinstated
9-49 under this subsection for service performed after the date of the
9-50 termination of employment that resulted in the judgment, order, or
9-51 settlement agreement.
9-52 SECTION 10. Subsection (e), Section 842.201, Government
9-53 Code, is amended to read as follows:
9-54 (e) In this section, "prosecuting attorney" means a person
9-55 who holds the office of district attorney, criminal district
9-56 attorney, or county attorney performing the duties of a district
9-57 attorney and who is compensated by the state in an amount set by
9-58 appropriation [has the meaning assigned by Section 842.106(c)].
9-59 SECTION 11. Section 843.002, Government Code, is amended to
9-60 read as follows:
9-61 Sec. 843.002. BENEFIT ELIGIBILITY AND AMOUNT [BASED ON
9-62 CREDITED SERVICE]. A member's eligibility to receive a benefit is
9-63 based on the member's amount of credited service and attained age
9-64 on the effective date [at the time] of retirement. The monthly
9-65 amount of a standard retirement annuity is based on the sum of the
9-66 member's service credit and accumulated contributions and is
9-67 computed using the member's attained age and the actuarial
9-68 assumptions described by Section 841.001(1).
9-69 SECTION 12. Subchapter A, Chapter 843, Government Code, is
10-1 amended by adding Sections 843.004 and 843.005 to read as follows:
10-2 Sec. 843.004. COMPOSITION OF SERVICE CREDIT. Service credit
10-3 consists of allocated prior service credit, current service credit,
10-4 and multiple matching credit as authorized by a participating
10-5 subdivision and accumulated interest under this subtitle.
10-6 Sec. 843.005. ADJUSTMENT TO CREDITED SERVICE AND CURRENT
10-7 SERVICE CREDIT. (a) The governing body of a participating
10-8 subdivision by order or resolution may authorize the establishment
10-9 of credited service and current service credit for a particular
10-10 person who has not received the correct amount of credited service
10-11 or current service credit for all current service performed for the
10-12 subdivision and who is barred from doing so by the limitation
10-13 period provided by Section 842.112(b).
10-14 (b) To authorize the establishment of credited service and
10-15 current service credit under this section, the governing body must
10-16 determine that the reporting error occurred without the knowledge
10-17 or fault of the person and that the authorization is in the best
10-18 interests of the subdivision. The subdivision shall verify the
10-19 amounts of service and the compensation received by the person for
10-20 those months for which credited service and current service credit
10-21 may be established under this section.
10-22 (c) The order or resolution must include the findings of the
10-23 governing body, the name of the person to whom the authorization
10-24 relates, and the months for which credited service and current
10-25 service credit may be established and must state the total
10-26 compensation paid to the person for those months.
10-27 (d) The service credit attributable to the member
10-28 contributions deposited under this section is determined using the
10-29 credit percentages in effect for the month in which a deposit is
10-30 made.
10-31 (e) For credited service and service credit under this
10-32 section, the retirement system must receive, not later than the
10-33 last day of the calendar year in which an order or resolution is
10-34 adopted by the governing body of a participating subdivision:
10-35 (1) for deposit in the member's individual account,
10-36 all contributions the member would have made to the retirement
10-37 system if the current service had been correctly reported; and
10-38 (2) for deposit in the subdivision's account, an
10-39 amount determined by the retirement system's actuary as necessary
10-40 to fully offset the actuarial liability resulting from the
10-41 additional credited service and service credit.
10-42 SECTION 13. Section 843.103, Government Code, is amended to
10-43 read as follows:
10-44 Sec. 843.103. STATEMENT OF PRIOR SERVICE. Before the fifth
10-45 anniversary of the date a member becomes eligible to claim prior
10-46 service credit, a [A] member claiming credit for prior service
10-47 shall file a detailed statement of the service with the treasurer
10-48 or other disbursing officer of the subdivision for which the
10-49 service was performed.
10-50 SECTION 14. Subsection (c), Section 843.105, Government
10-51 Code, is amended to read as follows:
10-52 (c) The allocated prior service credit is the percentage of
10-53 the maximum prior service credit granted by the subdivision to all
10-54 members who performed prior service for the subdivision. [The
10-55 total allocated prior service credits for members claiming prior
10-56 service with the subdivision may not exceed an amount for which the
10-57 prospective subdivision contributions to the retirement system will
10-58 be adequate to amortize, before the 25th anniversary of the
10-59 effective date of subdivision participation in the retirement
10-60 system:]
10-61 [(1) all obligations charged to its account in the
10-62 subdivision accumulation fund; and]
10-63 [(2) all basic and supplemental annuities derived from
10-64 credits granted by the subdivision.]
10-65 SECTION 15. Section 843.304, Government Code, is amended to
10-66 read as follows:
10-67 Sec. 843.304. CERTIFICATION OF SERVICE AND AVERAGE
10-68 COMPENSATION FOR MEMBER OF OPTIONAL CLASS[; DETERMINATION OF
10-69 ALLOCATED LOCAL SERVICE CREDIT]. (a) A member claiming credit for
11-1 prior service under this subchapter shall file a statement of prior
11-2 service in the manner required by Section 843.103.
11-3 (b) [After a member described in Section 843.301(a) files a
11-4 statement of prior service, the subdivision employing the officer
11-5 receiving the statement shall certify to the board of trustees the
11-6 amount of prior service approved and the average local
11-7 compensation, determined in the manner provided for computing the
11-8 average local compensation for employees of the subdivision who
11-9 became members on the effective date of merger of the local pension
11-10 system into the retirement system. After the board of trustees
11-11 receives a certification under this subsection, it shall determine
11-12 the maximum and allocated local service credits for the member in
11-13 the manner and using the percentages provided for employees of the
11-14 subdivision who became members on the effective date of merger.]
11-15 [(c)] After a member described in Section 843.302 files a
11-16 statement of prior service, the subdivision employing the officer
11-17 receiving the statement shall certify to the board of trustees the
11-18 amount of prior service approved and the average monthly
11-19 compensation paid by the subdivision, determined in the manner
11-20 provided for computing the average prior service compensation for
11-21 employees of the subdivision who became members on the effective
11-22 date of subdivision participation in the retirement system. After
11-23 the board of trustees receives a certification under this
11-24 subsection, it shall determine the maximum and allocated prior
11-25 service credits for the member in the manner and using the
11-26 percentages provided for computing the maximum and allocated prior
11-27 service credits for employees of the subdivision who became members
11-28 on the effective date of subdivision participation.
11-29 SECTION 16. Subsections (b) and (c), Section 843.403,
11-30 Government Code, are amended to read as follows:
11-31 (b) The current service credit of a member is an amount
11-32 equal to a percentage of the [accumulated] contributions made by
11-33 the member to the retirement system during a calendar year. The
11-34 percentage is determined by the governing body of the employing
11-35 subdivision at the time of its election to participate in the
11-36 retirement system, except that the percentage for a subdivision
11-37 that begins participation after December 31, 1977, is 100 percent.
11-38 (c) The multiple matching credit of a member is an amount
11-39 equal to a percentage of the [accumulated] contributions made by
11-40 the member to the retirement system during a calendar year. The
11-41 percentage is 0 percent until a greater percentage is adopted as
11-42 provided by Section 843.703 or, for a subdivision whose
11-43 participation in the retirement system began after October 31,
11-44 1980, unless a greater percentage is adopted by its governing body
11-45 before the first anniversary of the subdivision's effective date of
11-46 retirement system participation, after the actuary has determined
11-47 and certified that the greater percentage would not impair the
11-48 ability of the subdivision to amortize, before the 25th anniversary
11-49 of the participation date, all obligations that are charges against
11-50 its account in the subdivision accumulation fund. A multiple
11-51 matching credit includes any portion of a current service credit in
11-52 effect on January 1, 1978, that exceeds the member's current
11-53 service credit determined under Subsection (b).
11-54 SECTION 17. Section 843.501, Government Code, is amended to
11-55 read as follows:
11-56 Sec. 843.501. LEGISLATIVE SERVICE. (a) A member may
11-57 establish credited [credit for current] service in the retirement
11-58 system for service performed as a member of the legislature. A
11-59 member claiming credited service [credit] for previous legislative
11-60 service shall file a detailed statement of the service with the
11-61 [treasurer or other disbursing officer of the] subdivision by which
11-62 the member is currently employed. As soon as practicable after the
11-63 filing of a statement, the employing subdivision shall verify the
11-64 service claimed and certify to the board of trustees the amount of
11-65 service approved.
11-66 (b) Credited service [Credit] may not be established under
11-67 this section for service that is credited by another retirement
11-68 system or program established or governed by state law.
11-69 SECTION 18. Subsection (e), Section 843.601, Government
12-1 Code, is amended to read as follows:
12-2 (e) Except for credited service [credit] established with
12-3 the retirement system before December 31, 1999, the maximum amount
12-4 of credited service that a person may receive under this section is
12-5 five years. If a person would receive more than five years of
12-6 credited service [credit] as a result of having received credit
12-7 under Subsection (c) before receiving credit under Subsection (b),
12-8 the retirement system shall cancel credited service [credit] under
12-9 Subsection (c) [shall be canceled] to the extent necessary to
12-10 reduce the total to five years of credit.
12-11 SECTION 19. Subsection (d), Section 843.602, Government
12-12 Code, is amended to read as follows:
12-13 (d) In this section, "prosecuting attorney" has the meaning
12-14 assigned by Section 842.201(e) [842.106(c)].
12-15 SECTION 20. Section 844.001, Government Code, is amended to
12-16 read as follows:
12-17 Sec. 844.001. TYPES OF BENEFITS. The types of benefits
12-18 payable by the retirement system are:
12-19 (1) service retirement annuities [benefits];
12-20 (2) disability retirement annuities [benefits]; [and]
12-21 (3) survivor annuity death benefits;
12-22 (4) supplemental death benefits; and
12-23 (5) refunds of accumulated contributions.
12-24 SECTION 21. Section 844.002, Government Code, is amended by
12-25 adding Subsection (e) to read as follows:
12-26 (e) A separate retirement annuity is payable for each
12-27 participating subdivision from which a person retires under this
12-28 subtitle or is considered to have retired.
12-29 SECTION 22. Subsections (a) and (d), Section 844.003,
12-30 Government Code, are amended to read as follows:
12-31 (a) Except as provided by Subsections (b) and (d), the
12-32 effective date of a member's service retirement is the date the
12-33 member designates at the time the member applies for retirement
12-34 under Section 844.101, but the date must be the last day of a
12-35 calendar month and may not precede the date the member terminates
12-36 employment with the subdivision from which the member seeks to
12-37 retire [all participating subdivisions].
12-38 (d) A member who is eligible for service retirement and who
12-39 [on the day the member] terminates employment with a participating
12-40 subdivision may apply for and receive a service retirement annuity
12-41 based on service for that subdivision despite the fact that the
12-42 member is or becomes an employee of another participating
12-43 subdivision. Credited service [Service] with the member's new
12-44 employer may [not] be used in determining eligibility for service
12-45 retirement [the annuity, and contributions for the service may not
12-46 be used in determining the amount of the annuity]. A member who is
12-47 eligible for service retirement using combined credited service for
12-48 two or more subdivisions may simultaneously apply for and receive a
12-49 service retirement annuity for service to one subdivision and a
12-50 refund of accumulated contributions for service to another
12-51 subdivision. [The effective date of a retirement under this
12-52 subsection is the last day of the month in which the retirement
12-53 system receives the application, and that date may not be later
12-54 than the last day of the third month following the month in which
12-55 the member begins employment with the new employer.] A person who
12-56 retires under this subsection is considered for all purposes to be
12-57 a retiree who resumes service with a different employer under
12-58 Section 842.111.
12-59 SECTION 23. Section 844.005, Government Code, is amended to
12-60 read as follows:
12-61 Sec. 844.005. WHEN ANNUITY IS PAYABLE; CHANGES BEFORE FIRST
12-62 PAYMENT. (a) A retiree may revoke an application for retirement,
12-63 change the retiree's choice of retirement annuity payment plans, or
12-64 change the designation of beneficiary after the retiree's effective
12-65 date of retirement by filing written notice with the retirement
12-66 system not later than the last day of the month following the month
12-67 that includes the effective date of retirement [board of trustees
12-68 before the later of the date on which the retirement system makes
12-69 the first payment or the date the first annuity payment becomes
13-1 due]. After that day [the first payment has been made by the
13-2 retirement system or has become due], a retiree may not revoke the
13-3 application for retirement, change the annuity payment plan
13-4 selected, or [and may not] change the designated beneficiary except
13-5 under Section 844.006.
13-6 (b) A retiree who dies before the first day of the second
13-7 month following the month that includes the effective date of
13-8 retirement and who did not select an optional retirement annuity is
13-9 considered to have selected an optional annuity under Section
13-10 844.104(c)(7) or Section 844.305(c)(7), as applicable.
13-11 Alternatively, the decedent's beneficiary may elect to receive a
13-12 refund of the decedent's accumulated contributions under Section
13-13 844.401. [For purposes of this section, the term "makes payment"
13-14 includes the depositing in the mail of a payment or the crediting
13-15 of an account with payment through electronic funds transfer.]
13-16 (c) An annuity under this subtitle is payable to a retiree
13-17 or beneficiary through [for a period beginning on the last day of
13-18 the first month following] the month in which the retiree or
13-19 beneficiary dies. A continuation of an optional annuity begins
13-20 with payment for the month following [retirement occurs and ending,
13-21 except as otherwise provided by this subtitle, on the last day of
13-22 the month immediately preceding] the month in which death occurs.
13-23 SECTION 24. Subsection (d), Section 844.006, Government
13-24 Code, is amended to read as follows:
13-25 (d) If a qualified domestic relations order, as that term is
13-26 defined by Section 804.001, so provides, the benefit payable to a
13-27 retiree who is receiving payments of an annuity for the retiree's
13-28 life with payments to continue after the retiree's death until the
13-29 death of another person [under Option 1, 2, 4B, or 4C, as defined
13-30 by Section 103.2, Title 34, Texas Administrative Code,] may be
13-31 divided by the retirement system into two annuities if:
13-32 (1) the person who was designated to receive the
13-33 continued payment after the retiree's death is the same person as
13-34 the alternate payee;
13-35 (2) the [domestic relations] order specifies that one
13-36 of the two annuities is payable over the remaining life of the
13-37 retiree, with no payments to be made under that annuity after the
13-38 death of the retiree;
13-39 (3) the [domestic relations] order specifies that the
13-40 annuity payable to the alternate payee is payable over the
13-41 remaining life of that person, with no payments to be made under
13-42 that annuity after the death of the alternate payee named in the
13-43 order; and
13-44 (4) the annuity that would be payable to the person as
13-45 the alternate payee under the order would not exceed the annuity
13-46 that would be payable to that person as the retiree's surviving
13-47 beneficiary under the option selected if the retiree were deceased
13-48 [domestic relations order specifies that the portion of the benefit
13-49 payable to the alternate payee is stated as a fixed percentage of
13-50 the present benefit payable to the retiree, which percentage may
13-51 not exceed, as applicable:]
13-52 [(A) 25 percent of an Option 4B benefit;]
13-53 [(B) 50 percent of an Option 2 benefit; or]
13-54 [(C) 75 percent of an Option 4C benefit].
13-55 SECTION 25. Subsections (a), (c), and (h), Section 844.009,
13-56 Government Code, are amended to read as follows:
13-57 (a) [This section applies to all subdivisions that elect
13-58 after December 31, 1999, to begin participation in the retirement
13-59 system.] The governing body of a contributing [any] subdivision
13-60 with a member contribution rate of at least four percent that has
13-61 not elected to discontinue enrolling employees [participating as of
13-62 December 31, 1999,] may adopt the provisions of this section:
13-63 (1) on the terms provided by Subchapter H; or
13-64 (2) if the board of trustees determines that, based on
13-65 computations by the retirement system's actuary, the adoption would
13-66 not impair the ability of the subdivision to fund all obligations
13-67 against its account in the subdivision accumulation fund before the
13-68 25th anniversary of the subdivision's most recent actuarial
13-69 valuation date.
14-1 (c) The amount of a lump-sum distribution under this section
14-2 may not exceed 100 percent of the total accumulated contributions
14-3 [and accumulated interest] in the member's individual account in
14-4 the employees saving fund attributable to the credited service on
14-5 which the member has applied for retirement.
14-6 (h) No portion of a benefit awarded to an alternate payee
14-7 under a qualified domestic relations order may be distributed in
14-8 the form of a lump sum under this section, except that if the
14-9 member and the alternate payee agree in writing that the alternate
14-10 payee will receive all or a portion of the [a] lump-sum
14-11 distribution payable under this section [payment] instead of
14-12 benefits awarded under the qualified domestic relations order, the
14-13 amount of the lump-sum distribution described in the agreement may
14-14 be paid directly to the alternate payee in complete satisfaction of
14-15 the alternate payee's marital property rights and interest in the
14-16 member's benefit.
14-17 SECTION 26. Sections 844.101 and 844.102, Government Code,
14-18 are amended to read as follows:
14-19 Sec. 844.101. APPLICATION FOR SERVICE RETIREMENT ANNUITY. A
14-20 member may apply for a service retirement annuity by filing an
14-21 application for retirement with the retirement system [board of
14-22 trustees] on or before the member's effective retirement date
14-23 designated on the application.
14-24 Sec. 844.102. ELIGIBILITY FOR SERVICE RETIREMENT ANNUITY.
14-25 (a) A member is eligible to apply for and receive a service
14-26 retirement annuity[,] if the member:
14-27 (1) is at least 60 years old and has at least 12 years
14-28 of credited service in the retirement system;
14-29 (2) has at least 30 years of credited service in the
14-30 retirement system; or
14-31 (3) has met the eligibility requirements for service
14-32 retirement under Section 844.207, 844.210, or 844.211.
14-33 (b) A person who has retired with a service retirement
14-34 annuity is eligible, without regard to any age or credited service
14-35 requirement, to apply for and receive a service retirement annuity
14-36 based on service for another participating subdivision from which
14-37 the person has terminated employment.
14-38 SECTION 27. Subsection (c), Section 844.104, Government
14-39 Code, is amended to read as follows:
14-40 (c) An eligible person may select any of the following
14-41 optional annuities that[, which] are the actuarial equivalent of
14-42 the annuity to which the person is entitled and that [which]
14-43 provide that:
14-44 (1) after the retiree's death, the reduced annuity is
14-45 payable throughout the life of a person designated by the retiree;
14-46 (2) after the retiree's death, one-half of the reduced
14-47 annuity is payable throughout the life of a person designated by
14-48 the retiree;
14-49 (3) if the retiree dies before 60 monthly annuity
14-50 payments have been made, the remainder of the 60 payments are
14-51 payable to the retiree's beneficiary or, if one does not exist, to
14-52 the retiree's estate;
14-53 (4) if the retiree dies before 120 monthly annuity
14-54 payments have been made, the remainder of the 120 payments are
14-55 payable to the retiree's beneficiary or, if one does not exist, to
14-56 the retiree's estate;
14-57 (5) after the retiree's death, [one-fourth of] the
14-58 reduced annuity is payable throughout the life of a person
14-59 designated by the retiree, except that if the beneficiary
14-60 predeceases the retiree, the annuity payable throughout the
14-61 remaining life of the retiree is the annuity that would be payable
14-62 if the retiree had chosen a standard service retirement annuity;
14-63 (6) after the retiree's death, three-fourths of the
14-64 reduced annuity is payable throughout the life of a person
14-65 designated by the retiree; or
14-66 (7) if the retiree dies before 180 monthly annuity
14-67 payments have been made, the remainder of the 180 payments are
14-68 payable to the retiree's beneficiary or, if one does not exist, to
14-69 the retiree's estate.
15-1 SECTION 28. Sections 844.207, 844.210, and 844.211,
15-2 Government Code, are amended to read as follows:
15-3 Sec. 844.207. OPTIONAL BENEFIT ELIGIBILITY PLAN. (a) This
15-4 [The provisions of this] section applies [shall apply] to all
15-5 subdivisions that [elect after September 1, 1985, to] begin
15-6 participation in the retirement system after September 1, 1985, and
15-7 to all other subdivisions that have adopted the plan provisions of
15-8 this section. The [Subject to the conditions in this section, the]
15-9 governing body of a participating [any] subdivision [participating
15-10 as of September 1, 1985,] may adopt the plan provisions of this
15-11 section only on the terms provided by Subchapter H.
15-12 (b) In this section "eligible credited service" [The term
15-13 "Section 844.207 credited service" as used in this section] means
15-14 credited service performed for one or more participating
15-15 subdivisions that have adopted the plan provisions of this section
15-16 or [the plan provisions of] Section 844.210.
15-17 (c) A member is eligible to apply for and receive a service
15-18 retirement annuity[,] if the member:
15-19 (1) is at least 60 years old and has at least 10 years
15-20 of eligible [Section 844.207] credited service in the retirement
15-21 system; [or]
15-22 (2) is less than 60 years old, except as provided by
15-23 Subsection (e), and has a sufficient amount of eligible [years of
15-24 Section 844.207] credited service in the retirement system that,
15-25 when [that number is] added to the member's [years of] attained age
15-26 [of the member], equals or exceeds [produces a sum equal to or in
15-27 excess of] the number 80; or
15-28 (3) [if the member] is eligible for service retirement
15-29 under any other provision of this subtitle.
15-30 (d) A member who has 10 years or more of eligible [Section
15-31 844.207] credited service is a vested member for purposes of
15-32 Sections 844.202, 844.302, and 844.303.
15-33 (e) A member who on December 31, 1999, had [has] any
15-34 eligible [Section 844.207] credited service, whose membership in
15-35 the retirement system continues after that date without
15-36 interruption, and who accumulates four years or more of eligible
15-37 [Section 844.207] credited service is eligible to receive a service
15-38 retirement annuity regardless of age [benefit] when the amount of
15-39 eligible [number of years of Section 844.207] credited service
15-40 added to the [years of the] member's attained age equals or exceeds
15-41 the number 80.
15-42 [(f) After 1991, the governing body of a subdivision may not
15-43 adopt the plan provisions of this section except on the terms
15-44 provided by Subchapter H.]
15-45 Sec. 844.210. OPTIONAL BENEFIT ELIGIBILITY PLAN TWO.
15-46 (a) The [Subject to Subsection (f), the] governing body of a
15-47 participating subdivision may adopt the plan provisions of this
15-48 section only on the terms provided by Subchapter H.
15-49 (b) In this section "eligible credited service" ["Section
15-50 844.210 credited service"] means credited service performed for one
15-51 or more participating subdivisions that have adopted the plan
15-52 provisions of this section.
15-53 (c) A member is eligible to apply for and receive a service
15-54 retirement annuity if the member:
15-55 (1) is at least 60 years old and has at least eight
15-56 years of eligible [Section 844.210] credited service in the
15-57 retirement system;
15-58 (2) is less than 60 years old, except as provided by
15-59 Subsection (e), and has a sufficient amount of eligible [years of
15-60 Section 844.210] credited service in the retirement system that,
15-61 when added to the [years of the] member's attained age, equals or
15-62 exceeds [produces a sum equal to or in excess of] the number 80; or
15-63 (3) is eligible for service retirement under any other
15-64 provision of this subtitle.
15-65 (d) A member who has eight years or more of eligible
15-66 [Section 844.210] credited service in the retirement system is a
15-67 vested member for purposes of Sections 844.202, 844.302, and
15-68 844.303.
15-69 (e) A member who on December 31, 1999, had [has] any
16-1 eligible [Section 844.210] credited service, whose membership in
16-2 the retirement system continues after that date without
16-3 interruption, and who accumulates four years or more of eligible
16-4 [Section 844.210] credited service is eligible to receive a service
16-5 retirement annuity regardless of age [benefit] when the amount of
16-6 eligible [number of years of Section 844.210] credited service
16-7 added to the [years of the] member's attained age equals or exceeds
16-8 the number 80. For purposes of this subsection, eligible [Section
16-9 844.210] credited service also includes credited service performed
16-10 for one or more subdivisions that have adopted the plan provisions
16-11 of Section 844.207.
16-12 [(f) The governing body of a subdivision may not adopt the
16-13 plan provisions of this section except on the terms provided by
16-14 Subchapter H.]
16-15 Sec. 844.211. OPTIONAL BENEFIT ELIGIBILITY PLAN THREE.
16-16 (a) The [Subject to Subsection (e), the] governing body of a
16-17 participating subdivision may adopt the plan provisions of this
16-18 section only on the terms provided by Subchapter H.
16-19 (b) In this section "eligible credited service" ["Section
16-20 844.211 credited service"] means credited service performed for one
16-21 or more participating subdivisions that have adopted the plan
16-22 provisions of this section.
16-23 (c) A member is eligible to apply for and receive a service
16-24 retirement annuity if the member:
16-25 (1) is less than 60 years old, except as provided by
16-26 Subsection (d), and has a sufficient amount of eligible [years of
16-27 Section 844.211] credited service in the retirement system that,
16-28 when added to the [years of the] member's attained age, equals or
16-29 exceeds [produces a sum equal to or in excess of] the number 75; or
16-30 (2) is eligible for service retirement under any other
16-31 provision of this subtitle.
16-32 (d) A member who on December 31, 1999, had [has] any
16-33 eligible [Section 844.211] credited service, whose membership in
16-34 the retirement system continues after that date without
16-35 interruption, and who accumulates four years or more of eligible
16-36 [Section 844.211] credited service is eligible to receive a service
16-37 retirement annuity regardless of age [benefit] when the amount of
16-38 eligible [number of years of that] credited service added to the
16-39 years of the member's attained age equals or exceeds the number 75.
16-40 [(e) The governing body of a subdivision may not adopt the
16-41 plan provisions of this section except on the terms provided by
16-42 Subchapter H.]
16-43 SECTION 29. Subsection (a), Section 844.301, Government
16-44 Code, is amended to read as follows:
16-45 (a) A member may apply for a disability retirement annuity
16-46 by:
16-47 (1) filing an application for retirement with the
16-48 retirement system [board of trustees]; or
16-49 (2) having an application filed with the system
16-50 [board] by the member's employer or legal representative.
16-51 SECTION 30. Subsection (a), Section 844.304, Government
16-52 Code, is amended to read as follows:
16-53 (a) The standard disability retirement annuity is discounted
16-54 for the possibility of payment of a benefit under Section 844.402
16-55 [844.403] and is the actuarial equivalent of the sum of a member's:
16-56 (1) accumulated contributions;
16-57 (2) current service credit, accumulated at interest as
16-58 provided by Section 843.403(d);
16-59 (3) allocated prior service credit, accumulated at
16-60 interest as provided by Section 843.105(d); and
16-61 (4) multiple matching credit, accumulated at interest
16-62 as provided by Section 843.403(d).
16-63 SECTION 31. Subsection (c), Section 844.305, Government
16-64 Code, is amended to read as follows:
16-65 (c) An eligible person may select any of the following
16-66 optional annuities that [, which] are the actuarial equivalent of
16-67 the annuity to which the person is entitled and that [which]
16-68 provide that:
16-69 (1) after the retiree's death, the reduced annuity is
17-1 payable throughout the life of a person designated by the retiree;
17-2 (2) after the retiree's death, one-half of the reduced
17-3 annuity is payable throughout the life of a person designated by
17-4 the retiree;
17-5 (3) if the retiree dies before 60 monthly annuity
17-6 payments have been made, the remainder of the 60 payments are
17-7 payable to the retiree's beneficiary or, if one does not exist, to
17-8 the retiree's estate;
17-9 (4) if the retiree dies before 120 monthly annuity
17-10 payments have been made, the remainder of the 120 payments are
17-11 payable to the retiree's beneficiary or, if one does not exist, to
17-12 the retiree's estate;
17-13 (5) after the retiree's death, [one-fourth of] the
17-14 reduced annuity is payable throughout the life of a person
17-15 designated by the retiree, except that if the beneficiary
17-16 predeceases the retiree, the annuity payable throughout the
17-17 remaining life of the retiree is the annuity that would be payable
17-18 if the retiree had chosen a standard service retirement annuity;
17-19 (6) after the retiree's death, three-fourths of the
17-20 reduced annuity is payable throughout the life of a person
17-21 designated by the retiree; or
17-22 (7) if the retiree dies before 180 monthly annuity
17-23 payments have been made, the remainder of the 180 payments are
17-24 payable to the retiree's beneficiary or, if one does not exist, to
17-25 the retiree's estate.
17-26 SECTION 32. Subchapter D, Chapter 844, Government Code, is
17-27 amended by adding Section 844.3051 to read as follows:
17-28 Sec. 844.3051. ANNUITIES NOT SUBJECT TO DISCONTINUANCE. (a)
17-29 After the earlier of the date a disability retiree attains age 60
17-30 or the date the disability retiree would otherwise have become
17-31 eligible for service retirement under this subtitle, the retiree's
17-32 disability retirement annuity may not be revoked or discontinued
17-33 under this subtitle, and the retiree is not subject to further
17-34 medical examinations or required to submit annual earnings reports.
17-35 (b) A disability retirement annuity that is not subject to
17-36 revocation or discontinuance is considered a service retirement
17-37 annuity if the retiree returns to employment with a participating
17-38 subdivision.
17-39 SECTION 33. Subsection (a), Section 844.306, Government
17-40 Code, is amended to read as follows:
17-41 (a) Once each year during the first five years after a
17-42 person retires for disability, and once in each three-year period
17-43 after that, the board of trustees may require a disability retiree
17-44 [who is less than 60 years old] to undergo a medical examination.
17-45 SECTION 34. Subsection (a), Section 844.307, Government
17-46 Code, is amended to read as follows:
17-47 (a) If the medical board finds that a disability retiree
17-48 [who is less than 60 years old] is no longer mentally or physically
17-49 incapacitated for the performance of duty or is engaged in or able
17-50 to engage in gainful occupation, it shall certify its findings and
17-51 submit them to the board of trustees.
17-52 SECTION 35. Sections 844.308 and 844.309, Government Code,
17-53 are amended to read as follows:
17-54 Sec. 844.308. RETURN OF DISABILITY RETIREE TO MEMBERSHIP.
17-55 If the disability annuity of a person [who is less than 60 years
17-56 old] is discontinued under Section 844.306(c) or 844.307, the
17-57 person automatically resumes membership in the retirement system,
17-58 and the board of trustees shall terminate the person's annuity
17-59 payments.
17-60 Sec. 844.309. ADJUSTMENTS AT ANNUITY DISCONTINUANCE.
17-61 (a) If a person's membership resumes [is restored] under Section
17-62 844.308, the retirement system shall transfer:
17-63 (1) from the current service annuity reserve fund and
17-64 credit to the person's individual account in the employees saving
17-65 fund an [the] amount equal to the amount of accumulated
17-66 contributions transferred to the current service annuity reserve
17-67 fund at the time of retirement reduced by one percent for each year
17-68 or part of a year during which disability annuity payments were
17-69 made[, if any, by which the amount in the person's individual
18-1 account in the employees saving fund at the time of disability
18-2 retirement exceeds the sum of one-half of all basic annuity
18-3 payments made before the date the annuity was discontinued]; and
18-4 (2) from the current service annuity reserve fund to
18-5 the subdivision accumulation fund an amount equal to the amount
18-6 [sum] transferred from the subdivision accumulation fund to the
18-7 current service annuity reserve fund at the time of retirement
18-8 reduced by one percent for each year or part of a year during which
18-9 disability annuity payments were made [under Subdivision (1) of
18-10 this subsection to the employees saving fund].
18-11 (b) If a person whose [who is restored to] membership
18-12 resumes under Section 844.308 was receiving a supplemental annuity
18-13 based in whole or in part on [allocated] prior service credit, the
18-14 retirement system shall restore to effect as the person's maximum
18-15 [allocated] prior service credit an [the] amount equal to [by
18-16 which] the person's maximum [allocated] prior service credit at the
18-17 time of disability retirement reduced by one percent for each year
18-18 or part of a year during which disability annuity payments were
18-19 made [exceeds the sum of all annuity payments, based on prior
18-20 service credits, that were made before discontinuance of the
18-21 supplemental annuity].
18-22 (c) A person who resumes membership under Section 844.308 is
18-23 entitled to restoration of credited service in the number of months
18-24 accumulated and allowed before disability retirement.
18-25 (d) The board of trustees may adopt rules for the
18-26 computation and transfer of amounts and credits for a membership
18-27 resumed under this subchapter.
18-28 SECTION 36. Subsection (a), Section 844.310, Government
18-29 Code, is amended to read as follows:
18-30 (a) The retirement system may require a disability retiree
18-31 [who is less than 60 years old] to submit annually to the
18-32 retirement system a report of earnings. The retirement system
18-33 shall examine each report and may require at any time that a
18-34 disability retiree undergo a medical examination by one or more
18-35 physicians the retirement system designates, if the retiree has
18-36 reported earnings that the board of trustees considers to show an
18-37 ability to engage in gainful employment.
18-38 SECTION 37. Sections 844.401 and 844.402, Government Code,
18-39 are amended to read as follows:
18-40 Sec. 844.401. RETURN OF ACCUMULATED CONTRIBUTIONS.
18-41 (a) Except as provided by Subsection (c), if a member dies before
18-42 retirement, a lump-sum death benefit is payable from the employees
18-43 saving fund in the amount of:
18-44 (1) the decedent's accumulated contributions [in the
18-45 member's individual account in the fund]; plus
18-46 (2) interest computed on the decedent's accumulated
18-47 contributions on January 1 of the year of death from the beginning
18-48 of that [the] year [in which death occurs] through the end of the
18-49 month before the month in which death occurs [on the balance in the
18-50 member's individual account in the employees saving fund on January
18-51 1 of the year in which the member's death occurs].
18-52 (b) The benefit provided by this section is payable to the
18-53 decedent's beneficiary or, if no surviving beneficiary exists, to
18-54 the decedent's spouse or, if no surviving spouse exists, to the
18-55 decedent's estate [unless the decedent has directed that the
18-56 benefit be paid otherwise].
18-57 (c) A benefit is not payable under this section if an
18-58 annuity based on the same [decedent's] service with the subdivision
18-59 is payable under this subtitle.
18-60 Sec. 844.402. RETURN OF EXCESS CONTRIBUTIONS [OF SERVICE
18-61 RETIREE]. (a) After the death of a member or former member and
18-62 after the final payment has been made under any service,
18-63 disability, or survivor annuity [If a person who receives a
18-64 standard service retirement annuity dies], a lump-sum death benefit
18-65 is payable in an amount, if any, by which the amount in the
18-66 person's [retiree's] individual account in the employees saving
18-67 fund on which the annuity was computed [at the time of service
18-68 retirement] exceeds the amount of annuity payments made [before the
18-69 retiree's death].
19-1 (b) The benefit provided by this section is payable to the
19-2 person entitled to receive the final monthly payment of the annuity
19-3 [decedent's estate unless the decedent has directed that the
19-4 benefit be paid otherwise]. If that person is deceased, the benefit
19-5 provided by this section is payable to the person's beneficiary or,
19-6 if no surviving beneficiary exists, to the person's spouse or, if
19-7 no surviving spouse exists, to the person's estate.
19-8 (c) The benefit provided by this section is payable from the
19-9 current service annuity reserve fund and the subdivision
19-10 accumulation fund in the ratio that the parts of the [service]
19-11 retirement annuity that were payable from the funds bear to the
19-12 entire benefit as determined on the effective date of retirement.
19-13 SECTION 38. Subsections (a), (e), and (h), Section 844.407,
19-14 Government Code, are amended to read as follows:
19-15 (a) In this section "eligible member" means:
19-16 (1) a member who has four or more years of credited
19-17 service with one or more subdivisions that [on September 1, 1999,]
19-18 are participating in the retirement system and that are not
19-19 exempted from the application of this subdivision [or that begin
19-20 participation in the system after that date];
19-21 (2) a vested member described by Section 844.202 who
19-22 is at least 60 years of age or has 20 or more years of credited
19-23 service [with one or more subdivisions participating] in the
19-24 retirement system; or
19-25 (3) a member who is receiving a service retirement
19-26 annuity [at least 60 years of age and has 12 or more years of
19-27 credited service with one or more subdivisions participating in the
19-28 system;]
19-29 [(4) a member who is at least 60 years of age and has
19-30 10 or more years of Section 844.207 credited service; or]
19-31 [(5) a member who is at least 60 years of age and has
19-32 eight or more years of Section 844.210 credited service].
19-33 (e) [An unrevoked application for deferred service
19-34 retirement executed and filed by the member with the retirement
19-35 system before December 31, 1999, shall be considered a selection of
19-36 benefit and a designation of beneficiary under Subsection (c).] If
19-37 no application for deferred service retirement was [is] on file
19-38 with the retirement system on December 31, 1999 [on that date], an
19-39 unrevoked form executed by the member and filed with the system
19-40 naming a beneficiary to whom the member's accumulated contributions
19-41 [deposits] are to be paid in the event of death before retirement
19-42 is [shall be] considered a selection of a beneficiary under
19-43 Subsection (d).
19-44 (h) If no surviving spouse exists, the executor or
19-45 administrator of the member's estate may elect[:]
19-46 [(1)] for an estate beneficiary to receive the
19-47 optional annuity under Section 844.104(c)(7)[; or]
19-48 [(2) for the estate to receive a refund of the
19-49 member's accumulated contributions under Section 844.401].
19-50 SECTION 39. Subsection (b), Section 844.408, Government
19-51 Code, is amended to read as follows:
19-52 (b) If a surviving spouse or the executor or administrator
19-53 of a deceased member's estate would be entitled to make an election
19-54 under Section 842.110 [842.110(f)] or 842.111 [842.111(c)], or if a
19-55 beneficiary or the executor or administrator of a deceased member's
19-56 estate would be entitled to make an election under Section 844.407
19-57 because of the death of the member, the heirs of the deceased
19-58 member may make that election if:
19-59 (1) no surviving spouse exists, or, if Section 844.407
19-60 is applicable, no surviving beneficiary exists;
19-61 (2) no petition for the appointment of a personal
19-62 representative of the member is pending or has been granted;
19-63 (3) 30 days have elapsed since the date of death of
19-64 the member;
19-65 (4) the value of the entire assets of the member's
19-66 estate, excluding homestead and exempt property, does not exceed
19-67 $50,000; and
19-68 (5) on file with the retirement system is a certified
19-69 copy of a small estates affidavit that has been approved and filed
20-1 in accordance with Section 137, Texas Probate Code, or an original
20-2 affidavit described by Subsection (c).
20-3 SECTION 40. Section 844.501, Government Code, is amended by
20-4 adding Subsection (c) to read as follows:
20-5 (c) The supplemental death benefit program constitutes
20-6 "group term life insurance purchased for employees" as described by
20-7 Section 79, Internal Revenue Code of 1986.
20-8 SECTION 41. Subsections (a), (b), and (c), Section 844.503,
20-9 Government Code, are amended to read as follows:
20-10 (a) In this section, the terms "regular rate of pay," "hours
20-11 worked," "salary basis," and "regular salary" have meanings that
20-12 are consistent with the Fair Labor Standards Act of 1938 (29 U.S.C.
20-13 Section 201 et seq.).
20-14 (b) If a person included in the coverage or extended
20-15 coverage of the supplemental death benefit program dies, a lump-sum
20-16 supplemental death benefit is payable from the supplemental death
20-17 benefits fund in an amount equal to the current annual compensation
20-18 [salary] of the member at the time of death.
20-19 (c) The [(b) Except as provided by Subsection (c), the]
20-20 current annual compensation [salary] of a member who is not exempt
20-21 from the minimum wage and maximum hour requirements of the Fair
20-22 Labor Standards Act of 1938 (29 U.S.C. Section 201 et seq.) is
20-23 computed by converting to an annual basis the regular rate of pay
20-24 of the member for the most recent hour worked and proportionately
20-25 reducing that annual basis if the member is not employed in a
20-26 full-time position. The current annual compensation of a member
20-27 who is exempt from those minimum wage and maximum hour requirements
20-28 and who is paid on a salary basis is computed by converting to an
20-29 annual basis the regular salary paid to the member for the most
20-30 recent pay period of active employment [as the amount paid to the
20-31 member for service on which contributions were made to the
20-32 retirement system during the 12 months immediately preceding the
20-33 month of death. If a member did not receive compensation for
20-34 service in each of the 12 months immediately preceding the month of
20-35 death, the member's current annual salary is computed by converting
20-36 to an annual basis the amount paid to the member on which
20-37 contributions were made to the system during the period of
20-38 employment within the 12-month period. If a member did not receive
20-39 compensation for service in any of the 12 months immediately
20-40 preceding the month of death, or if the member was employed by a
20-41 subdivision that was not participating on a full-salary basis for
20-42 12 calendar months immediately preceding the month of death, the
20-43 member's current annual salary is computed by converting to an
20-44 annual basis the rate of compensation payable to the member during
20-45 the month of death].
20-46 [(c) The current annual salary of a member included in the
20-47 extended coverage of the supplemental death benefit program is
20-48 computed in the manner provided by Subsection (b) but as if the
20-49 member had died during the first month of extended coverage.]
20-50 SECTION 42. Section 844.504, Government Code, is amended to
20-51 read as follows:
20-52 Sec. 844.504. RETIREE SUPPLEMENTAL DEATH BENEFIT. If a
20-53 retiree dies who was receiving a retirement annuity based on [has
20-54 credited] service for [that has not been canceled by a withdrawal
20-55 of contributions and that results from employment with] a
20-56 subdivision that has elected to provide, and continues to provide,
20-57 postretirement supplemental death benefits, a lump-sum supplemental
20-58 death benefit is payable from the fund in the amount of $5,000
20-59 [$2,500]. If a retiree dies who was receiving retirement annuities
20-60 based on service for [employed by] more than one subdivision that
20-61 has elected to provide, and continues to provide, postretirement
20-62 supplemental death benefits, the financing of the lump-sum benefit
20-63 will [shall] be prorated among those [the employing] subdivisions
20-64 [participating in the fund]. If a person dies while payment of a
20-65 retirement annuity to that person is suspended as a result of
20-66 Section 842.110, the supplemental death benefit under this section
20-67 will [shall] be paid if it would have been payable except for the
20-68 suspension, unless a supplemental death benefit is payable under
20-69 Section 844.503 as a result of the member's death.
21-1 SECTION 43. Subsection (d), Section 844.703, Government
21-2 Code, is amended to read as follows:
21-3 (d) The actuary annually shall determine the subdivision
21-4 normal contribution rate and the prior service contribution rate
21-5 for subdivisions adopting the plan provisions of this subchapter
21-6 from the most recent data available at the time of determination.
21-7 Before January 1 of each year, the board of trustees shall certify
21-8 the rates of each subdivision that has adopted the plan provisions
21-9 of this subchapter. If the combined rates of the subdivision's
21-10 normal contributions and prior service contributions under this
21-11 subchapter exceed the rate prescribed by Subsection (c), and if the
21-12 governing body of the subdivision has not waived that maximum rate,
21-13 the rate for prior service contributions must be reduced to the
21-14 rate that equals the difference between the maximum rate prescribed
21-15 by Subsection (c) and the normal contribution rate. The governing
21-16 body may elect to contribute at a rate that is greater than the sum
21-17 of the subdivision's normal contribution rate and prior service
21-18 contribution rate as determined under Subsections (a) and (b). An
21-19 elected rate may [an integer percent but] not exceed [more than]
21-20 the maximum rate prescribed by Subsection (c), unless the governing
21-21 body has elected to waive that maximum rate[, if that elected rate
21-22 exceeds the sum of the subdivision's normal contribution rate and
21-23 its prior service contribution rate as determined under Subsections
21-24 (a) and (b)]. An [This] elected rate remains in effect for each
21-25 subsequent calendar year until it is rescinded by the governing
21-26 body. For years in which [or until] the sum of the rates
21-27 determined under Subsections (a) and (b) exceeds the elected rate,
21-28 [at which time] the governing body must contribute the sum of the
21-29 rates determined under Subsections (a) and (b). For years in which
21-30 the elected rate exceeds the sum of the rates determined under
21-31 Subsections (a) and (b), the prior service contribution rate is
21-32 increased to the rate that equals the difference between the
21-33 elected rate and the normal contribution rate prescribed by
21-34 Subsection (a).
21-35 SECTION 44. Subsections (b) and (d), Section 844.704,
21-36 Government Code, are amended to read as follows:
21-37 (b) On the adoption of the plan provisions of this
21-38 subchapter, the governing body shall select a percentage for
21-39 determining allocated prior service credits under Section 843.105[,
21-40 notwithstanding the limitation in Section 843.105(c)]. The
21-41 governing body shall select a percentage that is a multiple of five
21-42 percent. For a subdivision that began participation before January
21-43 1, 1992, the percentage cannot be less than the percentage in
21-44 effect immediately before the adoption of the plan. The governing
21-45 body may [thereafter] increase the percentage used in determining
21-46 allocated prior service credits under Section 843.105, to take
21-47 effect on the next January 1 after the date of the increase. The
21-48 selection of or increase in the percentage used in determining
21-49 allocated prior service credits may not result in greater benefits
21-50 being provided for completed service than would be provided through
21-51 current service credits and multiple matching credits for service
21-52 that is performed in the future.
21-53 (d) The governing body of a subdivision that has adopted or
21-54 is adopting the plan provisions of this subchapter may adopt or
21-55 authorize:
21-56 (1) an [the alternative optional] increase in
21-57 retirement annuities under Section 844.209;
21-58 (2) an [the optional] increase in retirement annuities
21-59 under Section 844.208;
21-60 (3) the [optional authorization of the]
21-61 reestablishment of credited service previously forfeited under
21-62 Section 843.003;
21-63 (4) the [optional authorization of the] establishment
21-64 of credited service for military service under Section 843.601(c);
21-65 (5) the reduction in the credited service requirement
21-66 for military service under Section 843.601(g);
21-67 (6) the [optional authorization of the] establishment
21-68 of premembership credited service for overage employees under
21-69 Section 843.204;
22-1 (7) [(6)] the [optional] benefit eligibility plan
22-2 described by Section 844.210 or 844.211; or
22-3 (8) the partial lump-sum distribution on service
22-4 retirement under Section 844.009 [(7) the optional benefit
22-5 eligibility plan described by Section 844.211].
22-6 SECTION 45. Section 845.306, Government Code, is amended to
22-7 read as follows:
22-8 Sec. 845.306. EMPLOYEES SAVING FUND. (a) The retirement
22-9 system shall deposit in a member's individual account in the
22-10 employees saving fund:
22-11 (1) the amount of contributions to the retirement
22-12 system deducted from the member's compensation;
22-13 (2) interest allowed on money in the account in
22-14 accordance with this subtitle;
22-15 (3) the portion of a deposit required by Section
22-16 843.003 to reinstate credited service previously terminated that
22-17 represents the amount withdrawn;
22-18 (4) the amount deposited in accordance with this
22-19 subtitle [Section 843.301(b) or 843.402(b)] to establish credit for
22-20 prior or current service for a person who became a member in
22-21 accordance with Subchapter C, Chapter 842;
22-22 (5) the amount, if any, deposited by a member in
22-23 accordance with Section 843.601(b) to establish current service
22-24 credit for military service; and
22-25 (6) the amount deposited by a person to become a
22-26 member in accordance with Section 842.103.
22-27 (b) The retirement system shall establish and maintain a
22-28 separate member individual account for each subdivision with which
22-29 the member has credited service.
22-30 (c) On December 31 of each year, the retirement system shall
22-31 credit to each member's individual account interest as allowed by
22-32 this subtitle on the amount of accumulated contributions [deposits]
22-33 credited to the member's account on January 1 of that year.
22-34 SECTION 46. Subsection (a), Section 845.307, Government
22-35 Code, is amended to read as follows:
22-36 (a) The retirement system shall deposit in the account of a
22-37 participating subdivision in the subdivision accumulation fund:
22-38 (1) all benefit contributions made by the subdivision
22-39 to the system pursuant to Section 845.404(a)(2);
22-40 (2) income allocated to the fund as provided by this
22-41 subtitle;
22-42 (3) amounts deposited by the subdivision under Section
22-43 845.408;
22-44 (4) the withdrawal charge for reinstatement of
22-45 credited service as provided by Section 843.003;
22-46 (5) the amount of matching contributions made by a
22-47 subdivision in accordance with this subtitle [Section 843.301(c) or
22-48 843.402(c)] to establish credit for prior or current service for a
22-49 person who became a member in accordance with Subchapter C, Chapter
22-50 842; and
22-51 (6) the amount deposited by a subdivision for a person
22-52 to become a member in accordance with Section 842.103.
22-53 SECTION 47. Subsection (f), Section 845.310, Government
22-54 Code, is amended to read as follows:
22-55 (f) The retirement system shall deposit and hold in the
22-56 perpetual endowment account funds, gifts, and awards that the
22-57 grantors designate as perpetual endowment for the retirement system
22-58 [and money forfeited to the retirement system as provided by
22-59 Section 845.505].
22-60 SECTION 48. Section 845.313, Government Code, is amended by
22-61 adding Subsection (c) to read as follows:
22-62 (c) The retirement system shall make payments by electronic
22-63 funds transfer to annuitants whose first annuity payment under this
22-64 subtitle occurs after January 1, 2002, except that the system may
22-65 make payment by check to an annuitant if making the payment by
22-66 electronic funds transfer would be impractical for the system or if
22-67 the annuitant properly notifies the system that:
22-68 (1) receiving the payment by electronic funds transfer
22-69 would be impractical for the person;
23-1 (2) receiving the payment by electronic funds transfer
23-2 would be more costly to the person than receiving the payment by
23-3 check; or
23-4 (3) the person is unable to establish a qualifying
23-5 account at a financial institution to receive electronic funds
23-6 transfers.
23-7 SECTION 49. Subsection (a), Section 845.315, Government
23-8 Code, is amended to read as follows:
23-9 (a) On December 31 of each year and after the balance of the
23-10 investment expenses account has been transferred to the
23-11 distributable income account, the board of trustees shall transfer
23-12 from the distributable income account of the interest fund the
23-13 following amounts:
23-14 (1) to the current service annuity reserve fund,
23-15 interest on the mean amount in the current service annuity reserve
23-16 fund during that year;
23-17 (2) to the supplemental death benefits fund, interest
23-18 on the mean amount in the supplemental death benefits fund during
23-19 that year;
23-20 (3) to the general reserves account of the endowment
23-21 fund, a dollar amount determined by the board of trustees as
23-22 necessary to provide adequate funding of the endowment fund,
23-23 including provisions for all special needs, all contingencies,
23-24 replenishment of the amount transferred during the current year to
23-25 the employees saving fund for interest to retiring or deceased
23-26 members plus the matching amount transferred to the subdivision
23-27 accumulation fund, and funding of investment expenses and
23-28 administrative costs for the following year;
23-29 (4) to the employees saving fund, current interest on
23-30 the sum of the accumulated contributions [deposits] in the
23-31 employees saving fund credited on January 1 of that year to all
23-32 persons who are members on December 31 of that year before any
23-33 transfers for retirement effective December 31 of that year are
23-34 made; and
23-35 (5) to the subdivision accumulation fund, the
23-36 remaining balance of the distributable income account in the
23-37 interest fund after transfers provided for by Subdivisions (1),
23-38 (2), (3), and (4) have been made.
23-39 SECTION 50. Subsections (a) and (b), Section 845.316,
23-40 Government Code, are amended to read as follows:
23-41 (a) When a member retires, the retirement system shall
23-42 transfer:
23-43 (1) from the employees saving fund to the current
23-44 service annuity reserve fund, the member's accumulated
23-45 contributions [deposits]; and
23-46 (2) from the subdivision accumulation fund to the
23-47 current service annuity reserve fund, an amount equal to the
23-48 member's accumulated current service credit.
23-49 (b) If the retiring member's accumulated contributions
23-50 [deposits] are the result of service for more than one
23-51 participating subdivision, the retirement system shall reduce the
23-52 amount credited to the account of each subdivision by the amount
23-53 chargeable to the subdivision for the member.
23-54 SECTION 51. Section 845.407, Government Code, is amended to
23-55 read as follows:
23-56 Sec. 845.407. PENALTY FOR LATE CONTRIBUTIONS. (a) Except
23-57 as provided by Subsections (c) and (d), a [A] participating
23-58 subdivision that fails to provide the information required by
23-59 Section 845.403 or to pay all contributions required by this
23-60 subchapter to be made and remitted to the retirement system not
23-61 later than the 15th [before the 16th] day of the month in which
23-62 they become [are] due shall pay a penalty under this section. The
23-63 penalty for a past-due monthly remission is equal to interest on
23-64 the past-due amounts for each day past due at a nominal interest
23-65 rate of 12 percent, plus a $500 administrative fee. If the penalty
23-66 is not paid within three months after the date notice of the
23-67 penalty has been sent to the subdivision, the retirement system
23-68 shall deduct the penalty from the subdivision's account in the
23-69 subdivision accumulation fund. The interest portion of the penalty
24-1 shall be deposited by the retirement system in the distributable
24-2 income account of the interest fund. The administrative fee
24-3 portion of the penalty shall be deposited by the retirement system
24-4 in the expense fund.
24-5 (b) Payments [Payment] and required reports are considered
24-6 to be made when received by the retirement system.
24-7 (c) A penalty will not be assessed under this section for a
24-8 late payment or report made in a document sent to the correct
24-9 address:
24-10 (1) by first-class mail not later than the 10th day of
24-11 the month in which the payment or report becomes due; or
24-12 (2) using a same-day or overnight delivery method,
24-13 approved by the board of trustees, not later than the 14th day of
24-14 the month in which the payment or report becomes due.
24-15 (d) If the retirement system does not receive a payment or
24-16 report, a penalty will not be assessed under this section if the
24-17 subdivision provides proof satisfactory to the system that the
24-18 document containing the payment or report was sent in accordance
24-19 with Subsection (c).
24-20 SECTION 52. Section 845.505, Government Code, is amended to
24-21 read as follows:
24-22 Sec. 845.505. UNCLAIMED BENEFITS [CLOSING OF ACCOUNTS].
24-23 (a) If a person's membership in the retirement system has
24-24 terminated and a valid application for a retirement [an] annuity or
24-25 [for] a refund of [the] accumulated contributions [of a former
24-26 member whose membership has terminated under Section 842.109(a)(1)]
24-27 has not been filed with the retirement system [before the end of
24-28 the year in which the member dies], the retirement system shall
24-29 mail the notice described by Subsection (b) [(d)] to the most
24-30 recent address of the former member [decedent's beneficiary] as
24-31 shown on system records and [or, if there is none, to the
24-32 decedent's most recent address as shown on system records. If the
24-33 notice is returned undelivered, the retirement system will] make
24-34 reasonable efforts to locate any person entitled to apply for the
24-35 benefit [the beneficiary or personal representative. If a valid
24-36 application for an annuity or for a refund of the accumulated
24-37 contributions of a deceased member is not filed with the retirement
24-38 system before the expiration of 180 days after the date the notice
24-39 is sent, the retirement system shall transfer the accumulated
24-40 contributions in the decedent's individual account in the employees
24-41 saving fund to the perpetual endowment account of the endowment
24-42 fund and close the decedent's account.]
24-43 [(b) On termination of a person's membership under Section
24-44 842.109(a)(4), the retirement system shall mail the notice
24-45 described by Subsection (d) to the former member's most recent
24-46 address as shown on system records. If the notice is returned
24-47 undelivered, the retirement system will make reasonable efforts to
24-48 locate the former member. If a valid application for a refund of
24-49 the accumulated contributions of the former member is not filed
24-50 with the retirement system before the expiration of 180 days after
24-51 the date the notice is sent, the retirement system shall transfer
24-52 the accumulated contributions in the former member's individual
24-53 account in the employees saving fund to the perpetual endowment
24-54 account of the endowment fund and close the former member's
24-55 account.]
24-56 [(c) If a valid application for retirement or for a refund
24-57 of the accumulated contributions of a member who is no longer in
24-58 covered employment is not filed with the retirement system before
24-59 the end of the later of the year in which the member reaches age
24-60 70-1/2 or the year in which the member terminates covered
24-61 employment, the retirement system shall mail the notice described
24-62 by Subsection (d) to the member at the member's most recent address
24-63 as shown on system records. If the notice is returned undelivered,
24-64 the retirement system will make reasonable efforts to locate the
24-65 member. If a valid application for retirement or for a refund of
24-66 the accumulated contributions of the member is not filed with the
24-67 retirement system before March 15 of the year in which distribution
24-68 must be made under Section 841.010, the person's membership
24-69 terminates as of March 31 of that year, and the retirement system
25-1 shall transfer the accumulated contributions in the member's
25-2 individual account in the employees saving fund to the perpetual
25-3 endowment account of the endowment fund and close the member's
25-4 account].
25-5 (b) [(d)] A notice under this section must include the name
25-6 of the [member or] former member, the name of each subdivision with
25-7 [from] which the former member has an individual account, a
25-8 statement that no additional interest is credited after a
25-9 membership has terminated [person received service credit], a
25-10 statement that a benefit is currently payable, a statement of the
25-11 procedure for obtaining payment of that benefit, and a statement
25-12 that a failure to file a valid application for benefits may cause
25-13 unclaimed benefits to be forfeited to the retirement system.
25-14 (c) [(e)] If a person files with the retirement system a
25-15 valid application for an annuity [retirement] based on a membership
25-16 that terminated under Section 842.109(b) [an account that has been
25-17 closed under Subsection (a) or (c)], the retirement system shall
25-18 [restore the member's individual account in the employees saving
25-19 fund and] pay an [a retirement] annuity computed as of the date on
25-20 which the annuity would have been required to begin under this
25-21 subtitle.
25-22 (d) An applicant who is the former member may select the
25-23 standard service retirement annuity or an optional service
25-24 retirement annuity under Section 844.104. An applicant who is the
25-25 surviving spouse of the former member may select an optional
25-26 service retirement annuity under Section 844.104. If the applicant
25-27 is not the former member or surviving spouse, the annuity will be
25-28 computed as an annuity under Section 844.104(c)(7). All annuity
25-29 payments that previously would have been paid if the annuity had
25-30 begun on the date required under this subtitle will be paid to the
25-31 applicant [person as a single sum].
25-32 (e) [(f)] If a person files with the retirement system a
25-33 valid application for a refund of a former member's accumulated
25-34 contributions [based on an account that has been closed under
25-35 Subsection (a), (b), or (c)], the retirement system shall pay to
25-36 the applicant [from the perpetual endowment account of the
25-37 endowment fund] the amount of the former member's accumulated
25-38 contributions to which the applicant is entitled.
25-39 (f) [(g)] If a person receiving an annuity fails to
25-40 negotiate more than five consecutive annuity payments, the
25-41 retirement system may send a notice to that person, stating that
25-42 unless the previous payments are negotiated not later than the 30th
25-43 day [within 30 days] after the date of the notice, payment of
25-44 benefits will be suspended [and the account closed until the person
25-45 files a written request with the retirement system to resume
25-46 payments]. After receipt of a valid application [written request
25-47 under this subsection], the retirement system shall [will] resume
25-48 making monthly payments. All annuity payments that would have
25-49 otherwise been paid if the annuity had not been suspended will be
25-50 paid to the person or, if the person has died, to the decedent's
25-51 beneficiary or, if no beneficiary exists, to the annuitant's estate
25-52 [as a single sum].
25-53 (g) If a benefit becomes payable as the result of [(h) On]
25-54 the death of a person receiving an annuity, the retirement system
25-55 shall mail a notice similar to the notice described by Subsection
25-56 (b) to the most recent address of the decedent's beneficiary as
25-57 shown on system records and make reasonable efforts to locate each
25-58 [any] person to whom the benefit is payable [annuity payments
25-59 should continue to be made as a result of that death and to notify
25-60 that person of any information necessary in order to make the
25-61 continued payments]. After receipt of a valid application, the
25-62 retirement system shall pay the applicant the benefit to which the
25-63 applicant is entitled. All annuity payments that would previously
25-64 have been paid if the annuity had begun on the date required under
25-65 this subtitle will be paid to the applicant.
25-66 (h) A person entitled to a benefit under this section is
25-67 solely responsible for a tax or penalty relating to the
25-68 distribution of the benefit without regard to whether the person
25-69 received notice from the retirement system.
26-1 (i) The board of trustees may adopt rules concerning the
26-2 notice, distribution, management, transfer, and administration of
26-3 unclaimed benefits and the authority of an applicant to act as
26-4 trustee of an absent beneficiary in the selection of a payment
26-5 option or receipt of an absent beneficiary's benefit under this
26-6 section [If the requested information has not been received by the
26-7 retirement system before the expiration of one year after the
26-8 annuitant's death, the retirement system shall suspend the annuity
26-9 and close the account until all requested information has been
26-10 received by the retirement system. After the retirement system
26-11 receives the requested information, it will resume making monthly
26-12 payments of the annuity and pay in a single sum all payments that
26-13 were suspended.]
26-14 [(i) The retirement system may apply a similar process as
26-15 provided by Subsection (a), (b), (c), (d), (e), or (f) to other
26-16 money it holds for payment, if the system first determines that no
26-17 claim for the money is likely to be filed].
26-18 SECTION 53. (a) Section 844.504, Government Code, as
26-19 amended by this Act, applies only to the death of a retiree
26-20 occurring after December 31, 2001. Section 844.504, Government
26-21 Code, as it existed immediately before the enactment of this Act,
26-22 applies to deaths that occurred on or before that date.
26-23 (b) Sections 844.005 and 844.503, Government Code, as
26-24 amended by this Act, apply only to benefits that become payable
26-25 after December 31, 2001.
26-26 (c) Sections 844.401 and 844.402, Government Code, as
26-27 amended by this Act, apply only to beneficiary determinations made
26-28 after December 31, 2001.
26-29 SECTION 54. The following provisions of the Government Code
26-30 are repealed:
26-31 (1) Section 843.301;
26-32 (2) Subsection (i), Section 844.009;
26-33 (3) Subsections (d), (e), (f), (g), (h), (i), (j),
26-34 (k), (l), (m), and (n), Section 844.104;
26-35 (4) Subsections (d), (e), (f), (g), (h), (i), (j),
26-36 (k), (l), and (m), Section 844.305;
26-37 (5) Section 844.403; and
26-38 (6) Subsection (c), Section 844.502.
26-39 SECTION 55. (a) Except as provided by Subsection (b) of
26-40 this section, this Act takes effect December 31, 2001.
26-41 (b) Sections 12 and 51 of this Act take effect September 1,
26-42 2001.
26-43 * * * * *