C.S.H.B. 264 78(R)    BILL ANALYSIS


C.S.H.B. 264
By: Brown, Fred
Pensions & Investments
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Currently, eligible employees hired since 1995 and choosing the Optional
Retirement Program receive an employer contribution appropriated by the
State equal to 6 percent of their salary, which is matched by an employee
payroll deduction equal to 6.65 percent.  An Appropriations Bill rider
prohibits institutions from supplementing the employer contribution,
though they are able to do so for employees hired prior to 1995. 

CSHB 264 will amend Subchapter C, Chapter 830 of the Government Code to
permit employing institutions to supplement the state appropriation with
other funds up to a total of 8.5 percent of salary for all eligible
employees choosing the Optional Retirement Program.  This total will more
closely approach the national average of 9 percent and narrow the current
competitive disadvantage hampering Texas institutions from recruiting and
retaining top talent. 

RULEMAKING AUTHORITY

This bill does not expressly delegate any additional rulemaking authority
to a state officer, department, agency, or institution. 


ANALYSIS

SECTION 1:  Amends Subchapter C, Chapter 830, Government Code, by adding
Section 830.2015, as follows: 

 Adds Section 830.2015, Supplemental Contributions from Institutions of
Higher Education, (a) permits governing boards of institutions of higher
education to use any source of funds to supplement the state appropriation
for the Optional Retirement Program. 

 Adds Subsection (b) stating that a contribution up to a total of 8.5
percent of salary. 

 Adds Subsection (c) stating that a contribution may be given to each
participant employed by the institution of higher education on or before
August 31, 1995 that is different from the amount of a participant
employed by an institution of higher education after that date . 

SECTION 2:  Effective date.

EFFECTIVE DATE

This Act takes effect immediately if it receives a vote of two-thirds of
all members elected to each House.  If it does not receive the votes
necessary for immediate effect, it will take effect on September 1, 2003. 

  
COMPARISON OF ORIGINAL TO SUBSTITUTE

The substitute bill makes the contribution by the institution of higher
education permissive and apply to a participant employed on or before
August 31, 1995 that is different from the amount of a participant
employed by an institution of higher education after that date.