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79R8299 DLF-F
By: McClendon H.B. No. 2374
A BILL TO BE ENTITLED
AN ACT
relating to the retirement system for firefighters and police
officers in certain municipalities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2.01(b), Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended to read as follows:
(b) The board, through its secretary, shall administer the
required elections of the active member and retiree representatives
by mailing ballots to all eligible members, retirees, or
beneficiaries. Only retirees and surviving spouses who are
currently receiving benefits from the fund are eligible to vote for
the retiree representatives. If no candidate receives a majority
of the votes cast for any trustee position, the board shall hold a
run-off election in which the only candidates are the candidates
who received the highest and second-highest number of votes cast.
If a candidate for trustee is unopposed in an election, the board
shall certify the candidate as elected to the board on the executive
director's certification that the candidate is eligible and is
unopposed for election.
SECTION 2. Sections 2.03(d) and (e), Chapter 824, Acts of
the 73rd Legislature, Regular Session, 1993 (Article 6243o,
Vernon's Texas Civil Statutes), are amended to read as follows:
(d) A removal election under this section must be held and
completed within 90 [30] days after the date the board certifies
that a proper petition for a removal election has been signed by at
least 20 percent of the membership from which the trustee was
elected. A trustee's term of service ends on the entry of an order
by the board declaring that a majority of the votes cast in a
removal election under this section favor removal.
(e) On the date the board enters an order under Subsection
(d) of this section, the board shall call a special election [to be
held not less than 20 nor more than 30 days after that date] to fill
the vacancy for the unexpired term of the trustee who was removed.
The trustee who was removed is not eligible to run in the special
election but is eligible to run in all subsequent board elections.
SECTION 3. Section 3.01, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended by adding Subsections (f)-(j) to read
as follows:
(f) Attendance by any number of the trustees at a conference
or gathering to research prospective investments or review current
ones, to attend professional training, or otherwise attend to their
fiduciary responsibilities, during which no formal discussion of
public business takes place and no formal action is taken, is not a
deliberation or meeting within the meaning of Chapter 551,
Government Code, and is not required to be open to the public.
(g) A trustee of the fund is immune from liability for an
action or omission made by the trustee in the performance of the
trustee's official duties for the fund that is made in good faith.
(h) Records that are in the custody of the board concerning
a member, former member, retiree, deceased retiree, beneficiary, or
alternate payee are not public information under Chapter 552,
Government Code, and may not be disclosed in a form identifiable to
a specific individual unless:
(1) the information is disclosed to:
(A) the individual or the individual's attorney,
guardian, executor, administrator, or conservator, or another
person whom the executive director determines from written
documentation to be acting in the interest of the individual or the
individual's estate;
(B) a spouse or former spouse of the individual,
if the executive director determines that the information is
relevant to the spouse's or former spouse's interest in a member's
accounts or benefits or other amounts payable by the pension
system;
(C) a government official or employee seeking
the information in order to perform the duties of the official or
employee; or
(D) a person authorized by the individual in
writing to receive the information; or
(2) the information is disclosed under a subpoena and
the executive director of the fund or the executive director's
designee determines that the individual will have a reasonable
opportunity to contest the subpoena.
(i) Subsection (h) of this section does not prevent the
disclosure of the status or identity of an individual as a member,
former member, retiree, deceased member, deceased retiree,
beneficiary, or alternate payee of the fund.
(j) A determination and disclosure under Subsection (h) of
this section does not require notice to the individual member,
retiree, beneficiary, or alternate payee.
SECTION 4. Section 3.03, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended by adding Subsection (e) to read as
follows:
(e) The board may pay for the cost of counseling for members
of the fund regarding retirement matters.
SECTION 5. Section 5.015, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended by amending Subsections (d) and (e) and
adding Subsections (d-1) and (e-1) to read as follows:
(d) The amount of a lump-sum payment to which a member
making a Back DROP election is entitled shall be computed in the
manner provided by this subsection and Subsection (d-1) of this
section. The member's retirement annuity shall be computed in the
manner provided by Section 5.01 of this Act, except that the amount
of service credit and average total salary [retirement date] used
in making that computation shall be determined in accordance with
[is the retirement date computed as provided by] this subsection.
For [The member's retirement annuity as so computed shall be
divided by 12 to compute the member's monthly pension. The member's
monthly pension multiplied by the number of full months elected by
the member under Subsection (b)(1) of this section is the amount of
the lump-sum payment to which the member is entitled. Solely for]
purposes of this subsection, [computing] the member's average total
salary shall be computed based on [monthly pension under this
subsection, the member's retirement date is] the member's Back DROP
retirement date, which is the member's actual retirement date less
the amount of time the member elects under Subsection (b)(1) of this
section. For purposes of this subsection, the member's service
credit shall be the member's service credit determined in
accordance with Section 5.01(g) of this Act less the amount of time
for:
(1) any service credit in excess of 34 years of
service, other than service credit for sick leave unused on the date
of actual retirement;
(2) any service credit given for sick leave unused on
the date of actual retirement; and
(3) any service credit in excess of 20 years but not in
excess of the amount permitted under Subsection (b)(1) of this
section that the member elects for computing the amount of the
lump-sum payment.
(d-1) The member's retirement annuity as computed under
Subsection (d) of this section shall be divided by 12 to compute the
member's monthly pension to be used to compute the lump-sum
payment. The member's monthly pension multiplied by the number of
full months elected by the member under Subsection (b)(1) of this
section is the amount of the lump-sum payment to which the member is
entitled.
(e) For purposes of computing the monthly pension of a
member making a Back DROP election, the member's retirement annuity
shall be computed in the manner provided by Section 5.01 of this
Act, except that:
(1) the amount of service credit [retirement date]
used in making that computation shall be [is] the member's service
credit determined in accordance with Section 5.01(g) of this Act
[actual retirement date] less:
(A) the amount of time the member elects under
Subsection (b)(1) of this section; and
(B) any service credit in excess of 34 years of
service excluding any service credit for sick leave unused on the
date of actual retirement; and
(2) the member's average total salary shall be
computed as if the member's retirement date were the member's actual
retirement date less the amount of time the member elects under
Subsection (b)(1) of this section.
(e-1) The annuity computed under Subsection (e) of this
section may not exceed the applicable limitations provided by
Section 5.01 of this Act. The member's retirement annuity shall be
divided by 12 to compute the member's monthly pension.
SECTION 6. Section 5.09(a), Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended to read as follows:
(a) At or before its regular meeting in the month of March,
the board annually shall review the Consumer's Price Index for All
Urban Consumers (CPI-U), U.S. City Average or the nearest
equivalent published by the United States Bureau of Labor
Statistics for the preceding calendar year. If that index shows an
increase during the preceding calendar year in the cost of living as
compared with that index at the close of the previous year, the
board shall order an increase of all service, disability, and death
benefit retirement annuities by a percentage that varies by the
date of the member's service or disability retirement, or, in the
case of a member who died before retirement, the date on which the
member died. If the member's service retirement, disability
retirement, or death before retirement occurred before August 30,
1971, the annuity shall be increased by a percentage equal to the
percentage increase in the cost of living index. If the member's
service retirement, disability retirement, or death before
retirement occurred on or after August 30, 1971, but before October
1, 1993 [1991], the annuity shall be increased as follows: if the
percentage increase in the cost of living index is eight percent or
less, the annuity shall be increased by a percentage equal to the
percentage increase, and if the percentage increase in the cost of
living index is more than eight percent, the annuity shall be
increased by eight percent plus a percentage equal to 75 percent of
the percentage increase that is more than eight percent. If the
member's service retirement, disability retirement, or death
before retirement occurred on or after October 1, 1993 [1991], the
annuity shall be increased by a percentage equal to 75 percent of
the percentage increase in the cost of living index. A percentage
increase in annuities shall be rounded to the nearest one-tenth
percentage point for a cost of living increase.
SECTION 7. Section 6.02, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended by amending Subsection (g) and adding
Subsections (m) and (n) to read as follows:
(g) A child who is born after the date of retirement of the
member is not entitled to a death benefit annuity under this Act
unless the retiree was married to the other parent of the child on
the date of retirement. A surviving spouse of a retiree who was not
married to the retiree until after the retiree's retirement is
entitled to receive only the benefits [benefit], if any, provided
under Subsection (m) of this section and Section 6.08 of this Act.
(m) Subject to Subsection (n) of this section, a service
retiree who marries after the date of retirement may elect to
receive a reduced annuity during the retiree's lifetime and provide
for a death benefit annuity to the retiree's surviving spouse. The
amount of the reduced annuity and spousal death benefit shall be
determined by the fund's actuary and shall be actuarially
equivalent to the annuity the retiree was receiving immediately
before the election under this subsection. An election made under
this subsection may be canceled by the retiree before the retiree's
death on the divorce of the retiree or the death of the retiree's
spouse. After the election is canceled, the retiree shall be
entitled to receive the same annuity to which the retiree would have
been entitled if the election had not been made. A retiree who
cancels an election under this subsection is not entitled to any
additional benefits for the period of time before the cancellation.
The board shall adopt policies and procedures governing elections
and cancellation of elections under this subsection. An election
or cancellation of an election made under this subsection must be
made in accordance with the board's policies and procedures.
(n) A retiree may not make an election under Subsection (m)
of this section at a time in which there are one or more dependent
children of the retiree who would be entitled to a death benefit
under this section on the death of the retiree.
SECTION 8. Section 6.08, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended by amending Subsection (b) and adding
Subsection (c) to read as follows:
(b) A surviving spouse [under this section] is not entitled
to a lump-sum death benefit under this section if a child is
entitled to receive benefits under this Act.
(c) A surviving spouse is not entitled to a lump-sum death
benefit under this section if the surviving spouse is entitled to an
annuity under Section 6.02(m) of this Act.
SECTION 9. Section 6.11, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 6.11. DEATH BENEFIT FOR ACTIVE MEMBER'S ESTATE. If an
active member dies and does not leave a beneficiary, the estate of
the deceased member is entitled to a death benefit payment from the
fund in an [the] amount equal to the greater of:
(1) five times the amount of an annuity computed in
accordance with Section 5.01(f) of this Act using the deceased
member's service credit and average total salary as of the date of
death; [of $10,000] or
(2) the refund of the member's contributions that were
picked up by the municipality[, whichever amount is greater].
SECTION 10. Section 6.115, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 6.115. DEATH BENEFIT FOR RETIREE'S ESTATE. If a
retiree dies and does not leave a beneficiary, the estate of the
retiree is entitled to a death benefit payment from the fund in an
[the] amount equal to five times the amount of the annuity awarded
by the board effective on [of] the retiree's date of retirement,
[contributions that were picked up by the municipality] less any
retirement or disability annuity and any lump sum under Section
5.015 of this Act paid to the retiree.
SECTION 11. Sections 6.14(h) and (l), Chapter 824, Acts of
the 73rd Legislature, Regular Session, 1993 (Article 6243o,
Vernon's Texas Civil Statutes), are amended to read as follows:
(h) In determining the annuity under Subsection (e) of this
section for a surviving spouse whose death benefit annuity is
limited by Section 6.02(b) of this Act, the deceased member's
service credit is the lesser of:
(1) the deceased member's service credit computed as
provided by Section 5.01(g) of this Act [27 years], less the number
of months elected by the surviving spouse under Subsection (f) of
this section; or
(2) 27 years.
(l) In determining the reduced annuity under Subsection (j)
of this section for a surviving spouse whose death benefit annuity
is limited by Section 6.02(b) of this Act, the deceased member's
service credit is the lesser of:
(1) the deceased member's service credit computed as
provided by Section 5.01(g) of this Act [27 years], less the number
of months elected by the surviving spouse under Subsection (f) of
this section; or
(2) 27 years.
SECTION 12. Section 7.06, Chapter 824, Acts of the 73rd
Legislature, Regular Session, 1993 (Article 6243o, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 7.06. INVESTMENT CONSULTANT [MANAGER] QUALIFICATIONS.
In appointing investment consultants [managers], the board shall
require that the investment consultant [manager] be:
(1) registered under the Investment Advisors Act of
1940 (15 U.S.C. Section 80b-1 et seq.) and its subsequent
amendments;
(2) a bank as defined by that Act; or
(3) an insurance company qualified to perform
investment services under the laws of more than one state.
SECTION 13. Sections 2.04(b) and 7.01, Chapter 824, Acts of
the 73rd Legislature, Regular Session, 1993 (Article 6243o,
Vernon's Texas Civil Statutes), are repealed.
SECTION 14. This Act takes effect October 1, 2005.