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78R1030 RCJ-D
By: Moreno of El Paso H.B. No. 280
A BILL TO BE ENTITLED
AN ACT
relating to the overpayment of benefits by a public retirement
system in reliance on an audit.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 802, Government Code, is
amended by adding Section 802.1025 to read as follows:
Sec. 802.1025. LIABILITY OF AUDITOR FOR OVERPAYMENTS (a)
If a public retirement system makes an overpayment of benefits to a
person entitled to receive payments from the system and the
overpayment was made by the system in reliance on an audit, the
system:
(1) may not take action against the recipient of the
overpayment for reimbursement; and
(2) is entitled to reimbursement for the overpayment
from the auditor whose audit was relied on in making the
overpayment.
(b) In addition to any other remedy provided by law, a
public retirement system may bring an action to recover against the
bond of the auditor whose audit was relied on in making the
overpayment. The system is entitled to recover against the bond in
an amount equal to the total amount of benefits overpaid by the
system after the date of the audit.
SECTION 2. Section 802.002(a), Government Code, is amended
to read as follows:
(a) Except as provided by Subsection (b), the Employees
Retirement System of Texas, the Teacher Retirement System of Texas,
the Texas County and District Retirement System, the Texas
Municipal Retirement System, and the Judicial Retirement System of
Texas Plan Two are exempt from Sections 802.101(a), 802.101(b),
802.101(d), 802.102, 802.103(a), 802.103(b), 802.202, 802.203,
802.204, 802.205, 802.206, and 802.207. The Judicial Retirement
System of Texas Plan One is exempt from all of Subchapters B and C
except Sections 802.1025, 802.104, and 802.105. The optional
retirement program governed by Chapter 830 is exempt from all of
Subchapters B and C except Sections 802.1025 and [Section] 802.106.
SECTION 3. Section 815.109, Government Code, is amended to
read as follows:
Sec. 815.109. CORRECTION OF ERRORS. If an error in the
records of the retirement system results in a person receiving more
or less money than the person is entitled to receive under this
subtitle, the retirement system shall correct the error. Except as
provided by Section 802.1025, the retirement system shall, [and] so
far as practicable, [shall] adjust future payments so that the
actuarial equivalent of the benefit to which the person is entitled
is paid.
SECTION 4. Section 825.109, Government Code, is amended to
read as follows:
Sec. 825.109. CORRECTION OF ERRORS. If an error in the
records of the retirement system results in a person's receiving
more or less money than the person is entitled to receive under this
subtitle, the board of trustees shall correct the error. Except as
provided by Section 802.1025, the retirement system shall, [and] so
far as practicable, [shall] adjust future payments so that the
actuarial equivalent of the benefit to which the person is entitled
is paid.
SECTION 5. Section 840.008, Government Code, is amended to
read as follows:
Sec. 840.008. CORRECTION OF ERRORS. If an error in the
records of the retirement system results in a person receiving more
or less money than the person is entitled to receive under this
subtitle, the retirement system shall correct the error. Except as
provided by Section 802.1025, the retirement system shall, [and] so
far as practicable, [shall] adjust future payments so that the
actuarial equivalent of the benefit to which the person is entitled
is paid.
SECTION 6. Section 854.408(d), Government Code, is amended
to read as follows:
(d) Except as provided by Section 802.1025, if [If] a
retiree is paid an occupational disability retirement annuity for
any month or series of months in amounts exceeding the sum allowable
under Subsection (b), the retirement system shall reduce subsequent
monthly payments successively until the amounts of the overpayments
have been offset.
SECTION 7. Section 12(b), Chapter 451, Acts of the 72nd
Legislature, Regular Session, 1991 (Article 6243n, Vernon's Texas
Civil Statutes), is amended to read as follows:
(b) If any change or error in the records of the retirement
system is discovered or results in any member, surviving spouse, or
beneficiary receiving from the retirement system more or less than
the member, surviving spouse, or beneficiary would have been
entitled to receive had the records been correct, the retirement
board shall have the power to correct such error. Except as
provided by Section 802.1025, Government Code, the retirement
system shall, [and] as far as possible, [to] adjust the payments in
such a manner that the actuarial equivalent of the benefits to which
the member, surviving spouse, or beneficiary was correctly entitled
shall be paid.
SECTION 8. Section 10.02, Chapter 452, Acts of the 72nd
Legislature, Regular Session, 1991 (Article 6243n-1, Vernon's
Texas Civil Statutes), is amended to read as follows:
Sec. 10.02. CORRECTION OF ERRORS. If any change or error
in the records of the police retirement system should be discovered
or should result in any member, retired member, surviving spouse,
or beneficiary receiving from the police retirement system more or
less than such member, retired member, surviving spouse, or
beneficiary would have been entitled to receive had the records
been correct, the police retirement board shall have the power to
correct such error. Except as provided by Section 802.1025,
Government Code, the retirement system shall, [and] as far as
possible, [to] adjust the payments so that the actuarial equivalent
of the benefits to which the member, retired member, surviving
spouse, or beneficiary was correctly entitled shall be paid.
SECTION 9. Section 3.03(d), Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended to read as follows:
(d) Except as provided by Section 802.1025, Government
Code, the [The] board may reduce the amount of a benefit to which a
retiree or beneficiary is otherwise entitled in order to reimburse
the fund for an overpayment or incorrect payment of benefits to the
retiree or beneficiary.
SECTION 10. (a) This Act applies only to an overpayment of
benefits made by a public retirement system in reliance on an audit
that is conducted on or after the effective date of this Act. An
overpayment made in reliance on an audit conducted before the
effective date of this Act is governed by the law as it existed
immediately before the effective date of this Act, and the former
law is continued in effect for that purpose.
(b) The change in law made by this Act with respect to an
action against a bond applies only to a claim against a bond that is
delivered, issued for delivery, or renewed on or after the
effective date of this Act. A bond that is delivered, issued for
delivery, or renewed before the effective date of this Act is
governed by the law as it existed immediately before the effective
date of this Act, and the former law is continued in effect for that
purpose.
SECTION 11. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas
Constitution. If this Act does not receive the vote necessary for
immediate effect, this Act takes effect September 1, 2003.