By:  Thompson (Senate Sponsor - Gallegos)                         H.B. No. 601
	(In the Senate - Received from the House April 15, 2003; 
April 22, 2003, read first time and referred to Committee on 
Administration; April 29, 2003, reported favorably by the 
following vote:  Yeas 6, Nays 0; April 29, 2003, sent to printer.)


A BILL TO BE ENTITLED

AN ACT


relating to the administration of a retirement system for officers 
and employees of certain municipalities.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Sections 2(c) and (j), Chapter 88, Acts of the 
77th Legislature, Regular Session, 2001 (Article 6243h, Vernon's 
Texas Civil Statutes), are amended to read as follows:
	(c)  The pension board consists of nine [11] trustees as 
follows:
		(1)  the mayor of the city, or the director of the civil 
service commission as the mayor's representative;
		(2)  the city treasurer or a person performing the 
duties of treasurer;     
		(3)  four municipal employees of the city who are 
members of the pension system;
		(4)  two retirees, each of whom:                                              
			(A)  has at least five years of credited service 
in the pension system;    
			(B)  receives a retirement pension from the 
pension system;  and           
			(C)  is not an officer or employee of the city;  
and                       
		(5)  one person who [three persons, each of whom]:    
			(A)  [is a registered voter in the city;             
			[(B)]  has been a resident of this state [the 
city] for the three years preceding the date of initial 
appointment; and
			(B) [(C)] is not a city officer or employee.         
	(j)  To serve as a trustee under Subsection (c)(5) of this 
section, the [a] person must be appointed by a vote of a majority of 
the elected trustees of the pension board [the governing body of the 
city].  The [Each] trustee appointed under Subsection (c)(5) of 
this section serves a two-year term.  The appointment or 
reappointment of [both] the appointed trustee [trustees] shall take 
place in January of each even-numbered year.  The appointed trustee 
may be removed at any time by a vote of a majority of the elected 
trustees of the pension board.  A vacancy caused by the [an] 
appointed trustee's death, resignation, or removal shall be filled 
by the elected trustees of the pension board [governing body of the 
city].  The appointee serves for the remainder of the unexpired term 
of the replaced trustee.  An appointed trustee may not serve beyond 
the expiration of the two-year term other than by appointment for a 
new term by the elected trustees of the pension board [governing 
body of the city].
	SECTION 2.  Section 3, Chapter 88, Acts of the 77th 
Legislature, Regular Session, 2001 (Article 6243h, Vernon's Texas 
Civil Statutes), is amended by adding Subsection (n) to read as 
follows:
	(n)  Notwithstanding any other law, the pension board may 
enter into a written agreement with the city regarding pension 
issues and benefits.  The agreement must be approved by the pension 
board and the governing body and signed by the mayor and by the 
pension board or the pension board's designee.  The agreement is 
enforceable against and binding on the city and the pension 
system's members, retirees, deferred participants, beneficiaries, 
eligible survivors, and alternate payees.
	SECTION 3.  The heading to Section 15, Chapter 88, Acts of 
the 77th Legislature, Regular Session, 2001 (Article 6243h, 
Vernon's Texas Civil Statutes), is amended to read as follows:
	Sec. 15.  [ANNUITY] INCREASE IN BENEFITS.              
	SECTION 4.  Section 15, Chapter 88, Acts of the 77th 
Legislature, Regular Session, 2001 (Article 6243h, Vernon's Texas 
Civil Statutes), is amended by adding Subsection (d) to read as 
follows:
	(d)  A pension benefit or allowance provided by this article 
may be increased if:
		(1)  a qualified actuary selected by the pension board 
determines that the increase cannot reasonably be considered to 
jeopardize the pension system's ability to pay any existing 
benefit;
		(2)  the increase is approved by the pension board and 
the city in a written agreement as provided by Section 3(n) of this 
article; and
		(3)  the increase does not deprive a member or retiree, 
without the written consent of the member or retiree, from 
receiving the immediate or deferred retirement benefit that the 
member or retiree was eligible to receive under this article before 
the increase.
	SECTION 5.  The terms of the appointed trustees serving 
under Section 2(c)(5), Chapter 88, Acts of the 77th Legislature, 
Regular Session, 2001 (Article 6243h, Vernon's Texas Civil 
Statutes), on the effective date of this Act expire on that date.  
Not later than October 1, 2003, a pension board shall appoint or 
reappoint a trustee to reflect the changes made by this Act to 
Section 2, Chapter 88, Acts of the 77th Legislature, Regular 
Session, 2001 (Article 6243h, Vernon's Texas Civil Statutes), for a 
term expiring in January 2004, as provided by Section 2(j), Chapter 
88, Acts of the 77th Legislature, Regular Session, 2001 (Article 
6243h, Vernon's Texas Civil Statutes), as amended by this Act.
	SECTION 6.  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.



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