1-1 By: Gallegos S.B. No. 802
1-2 (In the Senate - Filed February 20, 2001; February 21, 2001,
1-3 read first time and referred to Committee on Intergovernmental
1-4 Relations; March 22, 2001, reported favorably by the following
1-5 vote: Yeas 7, Nays 0; March 22, 2001, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to tax-exempt benefits for county employees.
1-9 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-10 SECTION 1. Subchapter C, Chapter 155, Local Government Code,
1-11 is amended to read as follows:
1-12 SUBCHAPTER C. [CAFETERIA PLAN] SALARY REDUCTIONS TO FINANCE
1-13 CERTAIN BENEFIT OPTIONS
1-14 Sec. 155.041. DEFINITION. In this subchapter, "county
1-15 employee" means a person who receives compensation for service
1-16 performed, other than as an independent contractor, for a county,
1-17 for a precinct or other unit of a county, or for a county officer
1-18 acting in an official capacity.
1-19 Sec. 155.042. BENEFIT [CAFETERIA PLAN] PROGRAM. The
1-20 commissioners court of a county by order or resolution may
1-21 establish a program to provide benefits that qualify for [qualifies
1-22 as] a cafeteria plan or a bona fide compensation reduction
1-23 arrangement under [Section 125 of] the federal Internal Revenue
1-24 Code of 1986 [(26 U.S.C. Section 125)] and regulations adopted
1-25 under that code [section].
1-26 Sec. 155.043. SALARY REDUCTION AGREEMENTS. (a) If the
1-27 commissioners court establishes a [cafeteria plan] program under
1-28 this subchapter, the court shall authorize county employees to
1-29 enter into voluntary agreements with the county to reduce the
1-30 periodic compensation paid the employees by the county by amounts
1-31 to be used to finance benefit options provided under the program
1-32 [cafeteria plan]. An authorization under this section must be made
1-33 available to all employees of the county.
1-34 (b) Amounts by which a county employee's compensation is
1-35 reduced under an agreement under this section are excluded from the
1-36 computation of contributions and other payments governed by federal
1-37 law to the extent authorized by federal law, including withholding
1-38 payments for federal income taxes and contributions to the federal
1-39 old age and survivors insurance program, but are not excluded in
1-40 the computation of contributions to and benefits from the Texas
1-41 County and District Retirement System and other retirement programs
1-42 governed by state law.
1-43 Sec. 155.044. RULES. The commissioners court may adopt
1-44 rules, consistent with this subchapter and federal [cafeteria plan]
1-45 requirements, for participation in and administration of the
1-46 program authorized by this subchapter.
1-47 SECTION 2. (a) This Act takes effect immediately if it
1-48 receives a vote of two-thirds of all the members elected to each
1-49 house, as provided by Section 39, Article III, Texas Constitution.
1-50 If this Act does not receive the vote necessary for immediate
1-51 effect, this Act takes effect September 1, 2001.
1-52 (b) The change in law made by this Act applies to a benefit
1-53 under Section 155.042, Local Government Code, that is provided
1-54 before, on, or after the effective date of this Act.
1-55 * * * * *