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A BILL TO BE ENTITLED
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AN ACT
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relating to correcting errors in the distribution of benefits by a |
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public retirement system. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 802.1024, Government Code, is amended by |
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amending Subsections (a) and (b) and adding Subsections (a-1) and |
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(a-2) to read as follows: |
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(a) Except as provided by Subsection (b), if an error in the |
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records of a public retirement system results in a person receiving |
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more or less money than the person is entitled to receive under this |
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subtitle, the [governing body of the] retirement system shall |
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correct the error and so far as practicable adjust any future |
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payments so that the actuarial equivalent of the benefit to which |
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the person is entitled is paid. If no future payments are due, the |
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[governing body of the] retirement system may recover the |
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overpayment in any manner that would be permitted for the |
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collection of any other debt. |
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(a-1) On discovery of an error described by Subsection (a), |
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the public retirement system shall as soon as practicable, but not |
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later than the 90th day after the date of discovery, give written |
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notice of the error to the person receiving an incorrect amount of |
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money. The notice must include: |
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(1) the amount of the correction in overpayment or |
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underpayment; |
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(2) how the amount of the correction was calculated; |
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(3) a brief explanation of the reason for the |
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correction; |
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(4) a statement that the notice recipient may file a |
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written complaint with the retirement system if the recipient does |
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not agree with the correction; |
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(5) instructions for filing a written complaint; and |
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(6) a payment plan option if no future payments are |
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due. |
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(a-2) Except as provided by this subsection and Section |
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802.1025, the public retirement system shall begin to adjust future |
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payments or, if no future payments are due, institute recovery of an |
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overpayment of benefits under Subsection (a) not later than the |
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90th day after the date the notice required by Subsection (a-1) is |
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delivered by certified mail, return receipt requested. If the |
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system does not receive a signed receipt evidencing delivery of the |
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notice on or before the 30th day after the date the notice is |
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mailed, the system shall mail the notice a second time by certified |
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mail, return receipt requested. Except as provided by Section |
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802.1025, not later than the 90th day after the date the second |
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notice is mailed, the system shall begin to adjust future payments |
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or, if no future payments are due, institute recovery of an |
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overpayment of benefits. |
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(b) Except as provided by Subsection (c), a public |
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retirement system: |
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(1) may correct the overpayment of benefits to a |
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person entitled to receive payments from the system by the method |
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described by Subsection (a) only for an overpayment made during the |
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three years preceding the date the [governing body of the] system |
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discovers or discovered the overpayment; [and] |
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(2) may not recover from the recipient any overpayment |
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made more than three years before the discovery of the overpayment; |
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and |
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(3) may not recover an overpayment if the system did |
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not adjust future payments or, if no future payments are due, |
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institute recovery of the overpayment within the time prescribed by |
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Subsection (a-2) or Section 802.1025. |
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SECTION 2. Subchapter B, Chapter 802, Government Code, is |
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amended by adding Section 802.1025 to read as follows: |
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Sec. 802.1025. COMPLAINT PROCEDURE. (a) Not later than the |
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20th day after the date of receiving notice under Section |
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802.1024(a-1) or, if applicable, the second notice under Section |
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802.1024(a-2), the notice recipient may file a written complaint |
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with the retirement system. The recipient shall include any |
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available supporting documentation with the complaint. |
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(b) Not later than the 30th day after the date of receiving a |
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complaint under Subsection (a), the retirement system shall respond |
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in writing to the complaint by confirming the amount of the proposed |
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correction or, if the retirement system determines the amount of |
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the proposed correction is incorrect, by modifying the amount of |
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the correction. If the retirement system modifies the amount of the |
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correction, the response must include: |
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(1) how the modified correction was calculated; |
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(2) a brief explanation of the reason for the |
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modification; and |
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(3) a payment plan option if no future payments are |
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due. |
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(c) Subject to Subsection (d), if a complaint is filed under |
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this section, the retirement system may not adjust future payments |
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or recover an overpayment under Section 802.1024 until: |
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(1) the 20th day after the date the notice recipient |
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receives the response under Subsection (b), if the recipient does |
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not file an administrative appeal by that date; or |
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(2) the date a final decision by the retirement system |
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is issued, if the recipient files an administrative appeal before |
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the date described by Subdivision (1). |
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(d) If the retirement system has begun the adjustment of |
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future payments or the recovery of an overpayment under Section |
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802.1024(a-2), the system shall discontinue the adjustment of |
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future payments or the recovery of the overpayment beginning with |
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the first pay cycle occurring after the date the complaint is |
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received by the system. The system may not recommence the |
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adjustment of future payments or the recovery of an overpayment |
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until the date described by Subsection (c)(1) or (2), as |
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applicable. If a complaint is resolved in favor of the person |
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filing the complaint, not later than the 30th day after the date of |
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the resolution, the system shall pay the person the appropriate |
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amount. |
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(e) A person whose complaint is not resolved under this |
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section must exhaust all administrative procedures provided by the |
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retirement system. Not later than the 30th day after the date a |
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final administrative decision is issued by the retirement system, a |
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person aggrieved by the decision may appeal the decision to an |
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appropriate district court. |
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SECTION 3. (a) Except as provided by Subsection (b) of this |
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section, the change in law made by this Act applies to an |
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underpayment or overpayment of benefits by a public retirement |
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system regardless of whether the underpayment or overpayment was |
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made before, on, or after the effective date of this Act. |
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(b) The change in law made by this Act does not apply to a |
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correction, adjustment, or recovery of an overpayment that |
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commenced before the effective date of this Act or an overpayment |
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that was resolved by an agreement made before the effective date of |
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this Act between a public retirement system and the recipient of the |
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overpayment. A correction, adjustment, or recovery of an |
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overpayment that commenced before the effective date of this Act is |
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governed by the law as it existed immediately before the effective |
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date of this Act, and the former law is continued in effect for that |
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purpose. |
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SECTION 4. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2007. |