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79R550 SGA-F

By:  Dutton                                                       H.B. No. 460



A BILL TO BE ENTITLED

AN ACT

relating to the designation of a child support obligee as an 
alternate payee under a qualified domestic relations order.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 804.001, Government Code, is amended by 
amending Subdivisions (1) and (2) and adding Subdivisions (1-a), 
(2-a), and (6) to read as follows:
		(1)  "Alternate payee" means a spouse, former spouse, 
child support obligee, child, or other dependent of a member or 
retiree who is recognized by a domestic relations order as having a 
right to receive all or a portion of the benefits payable by a 
public retirement system with respect to such member or retiree.
		(1-a)  "Child support obligee" has the meaning assigned 
to "obligee" by Section 101.021, Family Code.
		(2)  "Domestic relations order" means any judgment, 
decree, or order, including approval of a property settlement 
agreement, which relates to the provision of child support, alimony 
payments, or marital property rights to a spouse, former spouse, 
child support obligee, child, or other dependent of a member or 
retiree, and is made pursuant to a domestic relations law, 
including a community property law of the State of Texas or of 
another state.
		(2-a)  "Obligor" has the meaning assigned by Section 
101.022, Family Code.
		(6)  "Title IV-D agency" has the meaning assigned by 
Section 101.033, Family Code.
	SECTION 2.  Section 804.003, Government Code, is amended by 
adding Subsection (p) to read as follows:
	(p)  Benefits paid to a child support obligee as an alternate 
payee are considered, for federal tax purposes, as benefits payable 
to the child and shall be reported as taxable income of the retiree 
who is the obligor under Section 402(a), Internal Revenue Code of 
1986.
	SECTION 3.  Subchapter A, Chapter 804, Government Code, is 
amended by adding Section 804.006 to read as follows:
	Sec. 804.006.  INCOME WITHHOLDING ORDER OR WRIT CONSIDERED 
QUALIFIED DOMESTIC RELATIONS ORDER.  (a) An order or writ issued by 
a court of this state or the Title IV-D agency and received by a 
public retirement system to withhold income for child support from 
a retiree receiving benefits from the retirement system is 
considered a qualified domestic relations order.
	(b)  The child support obligee named in an order or writ 
under Subsection (a) is considered an alternate payee.
	(c)  Except as provided by Subsections (e) and (f), the 
public retirement system shall remit payments in accordance with 
the instructions in the order or writ under Subsection (a).
	(d)  The public retirement system shall pay the lesser of:              
		(1)  the sum of amounts stated in the order or writ for 
current child support, past due child support, current medical 
support, and past due medical support; or
		(2)  55 percent of the amount otherwise payable to the 
retiree.      
	(e)  Under an order or writ described by Subsection (a), the 
public retirement system shall execute only those withholding 
instructions in the order or writ that relate to current child 
support, past due child support, current medical support, and past 
due medical support.
	(f)  If the payment frequency in the order or writ differs 
from the frequency of the retirement plan distributions, the public 
retirement system shall adjust the payment amount stated in the 
order or writ to reflect the frequency of retirement plan 
distributions.
	(g)  A retiree subject to this section is entitled to the due 
process provisions under Chapter 158, Family Code, accorded a child 
support obligor whose employer receives a withholding order.
	(h)  If a member has not begun receiving retirement benefits 
under the plan administered by the public retirement system when 
the public retirement system receives an order or writ to withhold 
child support, the order or writ is considered unqualified and no 
response by the public retirement system to the submitter of the 
order is required. In response to inquiries about an unqualified 
order or writ under this subsection, the public retirement system 
shall provide the reason why the order or writ is considered 
unqualified.
	(i)  If a public retirement system receives under Subsection 
(a) more than one order or writ with regard to the same child 
support obligee for the same suit affecting the parent-child 
relationship, the retirement system shall comply with the 
requirements of the most recently received order or writ. For 
purposes of determining the priority of competing qualified 
domestic relations orders, the retirement system shall consider the 
date of the most recently received order or writ to be the date on 
which the retirement system received the first order or writ for the 
same child support obligee for the same suit affecting the 
parent-child relationship.
	(j)  An order or writ is terminated on the date that the 
public retirement system receives:
		(1)  a subsequent order or writ that orders zero 
dollars withheld;   
		(2)  an order from the court stating that the original 
order or writ is terminated; or
		(3)  a notice from the Title IV-D agency stating that 
the order or writ is terminated.
	SECTION 4.  The change in law made by this Act applies to an 
order or writ for withholding child support received by a public 
retirement system on or after the effective date of this Act. An 
order or writ for withholding child support received before the 
effective date of this Act is governed by the law in effect on the 
date the order or writ was received, and that law is continued in 
effect for that purpose.
	SECTION 5.  This Act takes effect September 1, 2005.