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AN ACT
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relating to audits of certain public retirement system actuarial |
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valuations, studies, and reports. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter B, Chapter 802, Government Code, is |
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amended by adding Section 802.1012 to read as follows: |
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Sec. 802.1012. AUDITS OF ACTUARIAL VALUATIONS, STUDIES, AND |
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REPORTS. (a) In this section, "governmental entity" means a unit |
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of government that is the employer of active members of a public |
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retirement system. |
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(b) Except as provided by Subsection (k), this section |
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applies only to a public retirement system with total assets the |
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book value of which, as of the last day of the preceding fiscal |
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year, is at least $100 million. |
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(c) Every five years, the actuarial valuations, studies, |
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and reports of a public retirement system most recently prepared |
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for the retirement system as required by Section 802.101 or other |
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law under this title or under Title 109, Revised Statutes, must be |
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audited by an independent actuary who: |
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(1) is engaged for the purpose of the audit by the |
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governmental entity; and |
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(2) has the credentials required for an actuary under |
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Section 802.101(d). |
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(d) Before beginning an audit under this section, the |
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governmental entity and the independent actuary must agree in |
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writing to maintain the confidentiality of any nonpublic |
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information provided by the public retirement system for the audit. |
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(e) Before beginning an audit under this section, the |
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independent actuary must meet with the manager of the pension fund |
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for the public retirement system to discuss the appropriate |
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assumptions to use in conducting the audit. |
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(f) Not later than the 30th day after completing the audit |
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under Subsection (c), the independent actuary shall submit to the |
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public retirement system for purposes of discussion and |
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clarification a preliminary draft of the audit report that is |
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substantially complete. |
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(g) The independent actuary shall: |
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(1) discuss the preliminary draft of the audit report |
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with the governing body of the public retirement system; and |
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(2) request in writing that the retirement system, on |
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or before the 30th day after the date of receiving the preliminary |
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draft, submit to the independent actuary any response that the |
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retirement system wants to accompany the final audit report. |
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(h) The independent actuary shall submit to the |
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governmental entity the final audit report that includes the audit |
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results and any response received from the public retirement |
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system: |
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(1) not earlier than the 31st day after the date on |
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which the preliminary draft is submitted to the retirement system; |
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and |
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(2) not later than the 60th day after the date on which |
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the preliminary draft is submitted to the retirement system. |
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(i) At the first regularly scheduled open meeting after |
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receiving the final audit report, the governing body of the |
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governmental entity shall: |
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(1) include on the posted agenda for the meeting the |
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presentation of the audit results; |
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(2) present the final audit report and any response |
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from the public retirement system; and |
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(3) provide printed copies of the final audit report |
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and the response from the public retirement system for individuals |
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attending the meeting. |
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(j) The governmental entity shall: |
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(1) maintain a copy of the final audit report at its |
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main office for public inspection; |
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(2) submit a copy of the final audit report to the |
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public retirement system and the State Pension Review Board not |
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later than the 30th day after the date the final audit report is |
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received by the governmental entity; and |
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(3) pay all costs associated with conducting the audit |
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and preparing and distributing the report under this section. |
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(k) This section does not apply to the Employees Retirement |
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System of Texas, the Teacher Retirement System of Texas, the Texas |
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County and District Retirement System, the Texas Municipal |
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Retirement System, or the Judicial Retirement System of Texas Plan |
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Two. |
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SECTION 2. The first audit required under Section 802.1012, |
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Government Code, as added by this Act: |
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(1) shall be conducted not later than September 1, |
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2008; and |
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(2) must include an audit of each actuarial valuation, |
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study, and report of the public retirement system that was prepared |
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for that retirement system in the preceding five years. |
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SECTION 3. This Act takes effect September 1, 2007. |
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______________________________ |
______________________________ |
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President of the Senate |
Speaker of the House |
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I certify that H.B. No. 2664 was passed by the House on May 4, |
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2007, by the following vote: Yeas 143, Nays 0, 2 present, not |
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voting. |
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______________________________ |
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Chief Clerk of the House |
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I certify that H.B. No. 2664 was passed by the Senate on May |
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22, 2007, by the following vote: Yeas 31, Nays 0. |
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______________________________ |
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Secretary of the Senate |
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APPROVED: _____________________ |
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Date |
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_____________________ |
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Governor |