81R9245 SGA-F
 
  By: Truitt H.B. No. 2559
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the powers and duties of the Employees Retirement
  System of Texas.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 659.102(c), Government Code, is amended
  to read as follows:
         (c)  The supplemental optional benefits program may include:
               (1)  a group coverage plan for permanent life
  insurance, catastrophic illness insurance, or disability
  insurance;
               (2)  [,] prepaid legal services; [,] or
               (3)  a qualified transportation benefit.
         SECTION 2.  Subchapter A, Chapter 811, Government Code, is
  amended by adding Section 811.010 to read as follows:
         Sec. 811.010.  TRAVIS COUNTY VENUE; TWO-YEAR LIMITATION.
  Subject to and without waiving the retirement system's sovereign
  immunity from suit or liability or the official immunity from
  liability of the trustees, officers, and employees of the
  retirement system under Section 811.007, for any action by or
  against the retirement system, the trustees, officers, or employees
  of the retirement system, or an administrator, carrier, or other
  governmental agency acting in cooperation with or on behalf of the
  retirement system:
               (1)  venue is in Travis County; and
               (2)  the statute of limitations is two years unless
  otherwise specifically provided by law.
         SECTION 3.  Section 814.008(a), Government Code, is amended
  to read as follows:
         (a)  A retiree receiving an optional service or disability
  retirement annuity approved by the board of trustees or described
  by Section 814.108(c)(1), [or] (c)(2), or (c)(5) may change the
  designated beneficiary as provided by this section for the benefits
  payable after the retiree's death.
         SECTION 4.  Subchapter A, Chapter 814, Government Code, is
  amended by adding Section 814.012 to read as follows:
         Sec. 814.012.  DISPOSITION OF UNCLAIMED BENEFICIARY
  BENEFITS. If, as of the fourth anniversary of the death of a member
  or annuitant, the retirement system has not paid benefits and a
  claim for benefits is not pending with the retirement system based
  on the death of the member or annuitant, the accumulated
  contributions of the deceased member or the balance of the reserve
  for the deceased annuitant reverts to the benefit of the retirement
  system. The retirement system shall transfer funds reverted under
  this section to the state contribution account.
         SECTION 5.  Sections 814.108(c), (g), and (h), Government
  Code, are amended to read as follows:
         (c)  An eligible person may select [any optional retirement
  annuity approved by the board of trustees, or may select] one of the
  following options, which provides [provide] that:
               (1)  after the retiree's death, the reduced annuity is
  payable in the same amount throughout the life of the person
  designated by the retiree before retirement;
               (2)  after the retiree's death, one-half of the reduced
  annuity is payable throughout the life of the person designated by
  the retiree before retirement;
               (3)  if the retiree dies before 60 monthly annuity
  payments have been made, the remainder of the 60 payments are
  payable to one or more designees or, if one does not exist, to the
  retiree's estate; [or]
               (4)  if the retiree dies before 120 monthly annuity
  payments have been made, the remainder of the 120 payments are
  payable to one or more designees or, if one does not exist, to the
  retiree's estate; or
               (5)  after the retiree's death, three-fourths of the
  reduced annuity is payable throughout the life of the person
  designated by the retiree before retirement.
         (g)  Except as provided by Section 814.008 or 814.1081, a
  person who selected an optional service retirement annuity approved
  by the board of trustees or an optional service retirement annuity
  described by Subsection (c)(1), [or] (c)(2), or (c)(5) may not
  change or revoke a beneficiary designation after the person's
  effective date of retirement.
         (h)  A beneficiary designation that names a former spouse as
  beneficiary for a guaranteed optional annuity described by
  Subsection (c)(3) or (c)(4) is invalid unless the designation is
  made after the date of the divorce.
         SECTION 6.  Section 814.1081(a), Government Code, is amended
  to read as follows:
         (a)  A person who retired and selected an optional service
  retirement annuity [approved by the board of trustees or an
  optional service retirement annuity] described by Section
  814.108(c)(1), [or] (c)(2), or (c)(5) may change the optional
  annuity selection to the selection of a standard service retirement
  annuity by filing with the retirement system a request to change the
  annuity selection, if the retiree designated a person as
  beneficiary who:
               (1)  was not at the time of designation and is not
  currently the retiree's spouse or child; or
               (2)  has executed since the designation a transfer and
  release, approved by a court of competent jurisdiction pursuant to
  a divorce decree, of the beneficiary's interest in the annuity and
  is not currently the retiree's spouse or child.
         SECTION 7.  Section 814.202, Government Code, is amended by
  adding Subsection (g) to read as follows:
         (g)  A member otherwise eligible to receive a disability
  retirement annuity may not receive the annuity if the member is:
               (1)  still earning a salary or wage from the employment
  for which the member is claiming disability; or
               (2)  on leave without pay from the employment for which
  the member is claiming disability.
         SECTION 8.  Section 814.203, Government Code, is amended to
  read as follows:
         Sec. 814.203.  CERTIFICATION OF DISABILITY. (a) As soon as
  practicable after an application for disability retirement is
  filed, the medical board shall evaluate the medical and other
  pertinent information regarding the member's application.  If the
  medical board finds that the member is mentally or physically
  incapacitated for the further performance of duty, as supported by
  substantial, objective, medical evidence, and that the incapacity
  is likely to be permanent, the medical board shall issue a
  certification of disability and submit it to the executive
  director.  A certification under this section is admissible in a
  contested case under Section 815.511 without proving the medical
  board as experts.
         (b)  For purposes of this subchapter, a member is
  incapacitated for the further performance of duty if the member has
  demonstrably sought and been denied workplace accommodation of the
  disability in accordance with applicable law, and the member is
  physically or mentally unable to continue to hold the position
  occupied or to hold any other position offering comparable pay. The
  employee's education, training, and experience must be considered
  when making a determination of incapacity under this subchapter.
         (c)  For the purposes of this section, "comparable pay" means
  80 percent or more of the member's final state employment base pay
  before deductions for taxes or deferred compensation under state
  and federal law, including any longevity or hazardous duty pay, but
  excluding the monetary value of any insurance or retirement
  benefits. Comparable pay may be adjusted by the retirement system
  to account for adjustments in state pay rates.
         SECTION 9.  Subchapter C, Chapter 815, Government Code, is
  amended by adding Section 815.214 to read as follows:
         Sec. 815.214.  SUBPOENA. Notwithstanding any other law, the
  executive director or the executive director's designee may issue a
  subpoena that conforms to Rule 176, Texas Rules of Civil Procedure,
  including a preappeal investigative subpoena or any subpoena
  otherwise authorized by the Texas Rules of Civil Procedure, that
  the executive director or designee determines necessary to protect
  the interests of a program or system administered by the retirement
  system.
         SECTION 10.  Section 815.307, Government Code, as amended by
  Chapters 1103 (H.B. 2240) and 1111 (H.B. 2359), Acts of the 78th
  Legislature, Regular Session, 2003, is reenacted to read as
  follows:
         Sec. 815.307.  DUTY OF CARE.  The assets of the retirement
  system shall be invested and reinvested without distinction as to
  their source in accordance with Section 67, Article XVI, Texas
  Constitution. A determination of whether the board of trustees has
  exercised prudence with respect to an investment decision must be
  made taking into consideration the investment of all assets of the
  trust or all assets of the collective investment vehicle, as
  applicable, over which the board has management and control, rather
  than considering the prudence of a single investment of the trust or
  the collective investment vehicle, as applicable.
         SECTION 11.  Section 815.512, Government Code, is amended to
  read as follows:
         Sec. 815.512. PROTECTION FROM DOUBLE OR MULTIPLE LIABILITY.
  (a) The executive director may cause an action for interpleader [a
  suit] concerning a claim to be filed on behalf of the retirement
  system in a district court in Travis County to protect the system
  from double or multiple liability if the executive director
  determines that a claim may expose the retirement system to such
  liability.
         (b)  A person may not pursue a counterclaim or other cause of
  action against the retirement system or its trustees, officers,
  employees, carriers, or administering firms in connection with the
  transactions and occurrences related to the interpleader action.
         (c)  A person who files suit against the retirement system or
  its trustees, officers, employees, carriers, or administering
  firms is liable for the costs and attorney's fees incurred in
  violation of Subsection (b).
         SECTION 12.  Subchapter F, Chapter 815, Government Code, is
  amended by adding Section 815.515 to read as follows:
         Sec. 815.515.  DISPOSITION OF UNCLAIMED CONTRIBUTIONS OF
  FORMER MEMBERS. (a) Subject to Chapters 803 and 805, if the
  retirement system has not received a demand for a refund of the
  accumulated contributions of a member in accordance with Subchapter
  B, Chapter 812, before the seventh anniversary of the member's last
  day of service, the retirement system may refund the accumulated
  contributions to the member or the member's heirs. If the member or
  the member's heirs cannot be found, the member's accumulated
  contributions revert to the retirement system.
         (b)  The retirement system shall credit any amounts that
  revert to the retirement system under Subsection (a) to the state
  contribution account.
         (c)  The board of trustees may adopt rules to implement and
  administer this section.
         SECTION 13.  Section 837.003, Government Code, is amended by
  adding Subsection (e) to read as follows:
         (e)  At the time a service retirement, disability
  retirement, or death benefit annuity becomes payable, the
  retirement system shall refund any contributions, interest, or
  membership fees used to establish service credit that is not used in
  computing the amount of the annuity.
         SECTION 14.  Section 838.106, Government Code, is amended by
  adding Subsection (c) to read as follows:
         (c)  For the purpose of Subsection (a)(1), the term of a
  member leaving judicial office ends December 31 regardless of the
  date on which the member's successor takes the oath of office.
         SECTION 15.  Section 839.103(a), Government Code, is amended
  to read as follows:
         (a)  Instead of a service retirement annuity payable under
  Section 839.102, a retiring member may elect to receive [an
  optional service retirement annuity provided by the board of
  trustees or] one of the following optional service retirement
  annuities, actuarially reduced to an actuarially equivalent value
  and consisting of:
               (1)  an annuity payable during the retiring member's
  life and continuing after death in the same amount, throughout the
  life of one person designated by the retiring member before
  retirement;
               (2)  an annuity payable during the retiring member's
  life and continuing after death in an amount equal to one-half of
  the amount payable during the retiring member's life, throughout
  the life of one person designated by the retiring member before
  retirement;
               (3)  an annuity payable for the greater of the rest of
  the retiring member's life or 60 months; [or]
               (4)  an annuity payable for the greater of the rest of
  the retiring member's life or 120 months; or
               (5)  an annuity payable during the retiring member's
  life and continuing after death in an amount equal to three-fourths
  of the amount payable during the retiring member's life, throughout
  the life of one person designated by the retiring member before
  retirement.
         SECTION 16.  Section 840.303, Government Code, as amended by
  Chapters 1103 (H.B. 2240) and 1111 (H.B. 2359), Acts of the 78th
  Legislature, Regular Session, 2003, is reenacted to read as
  follows:
         Sec. 840.303.  DUTY OF CARE.  The assets of the retirement
  system shall be invested and reinvested without distinction as to
  their source in accordance with Section 67, Article XVI, Texas
  Constitution. A determination of whether the board of trustees has
  exercised prudence with respect to an investment decision must be
  made taking into consideration the investment of all assets of the
  trust or all assets of the collective investment vehicle, as
  applicable, over which the board has management and control, rather
  than considering the prudence of a single investment of the trust or
  the collective investment vehicle, as applicable.
         SECTION 17.  Section 1551.102(d), Insurance Code, is amended
  to read as follows:
         (d)  An individual is eligible to participate in the group
  benefits program as provided by Subsection (a) if [the individual]:
               (1)  the individual retires under the optional
  retirement program established by Chapter 830, Government Code;
               (2)  the individual has [, with] at least 10 years of
  eligible service credit; [and]
               (3)  the individual actively [(2)] receives [or is
  eligible to receive] an annuity under that program; and
               (4)  the individual:
                     (A)  is at least 65 years of age, or would have
  been eligible to retire and receive a service or disability
  retirement annuity from the Teacher Retirement System of Texas or
  the Employees Retirement System of Texas in an amount such that the
  sum of the person's age and amount of service credit, including
  months of age and credit, equals or exceeds the number 80 or would
  have been eligible to retire and receive a disability retirement
  annuity from the Teacher Retirement System of Texas or the
  Employees Retirement System of Texas, if the individual had not
  elected to participate in the optional retirement program; or
                     (B)  is disabled as determined by the Employees
  Retirement System of Texas based on at least 10 years of eligible
  service credit.
         SECTION 18.  Section 1551.155, Insurance Code, is amended by
  adding Subsections (c) and (d) to read as follows:
         (c)  A person who is the surviving spouse of an individual
  may secure group health coverage without evidence of the person's
  insurability if the individual was eligible to participate in the
  group benefits program under Section 1551.101 or 1551.102 but was
  not participating at the time of the individual's death.
         (d)  A surviving spouse seeking group coverage under
  Subsection (c):
               (1)  must apply for the coverage not later than the 30th
  day after the date on which the individual who was eligible to
  participate in the group benefits program dies; and
               (2)  shall pay for the coverage at the group rate as
  provided by Subsection (b).
         SECTION 19.  The heading to Section 1551.156, Insurance
  Code, is amended to read as follows:
         Sec. 1551.156.  COVERAGE OPTIONS FOR SURVIVING DEPENDENT
  [WHEN THERE IS NO SURVIVING SPOUSE].
         SECTION 20.  Section 1551.156, Insurance Code, is amended by
  adding Subsections (d) and (e) to read as follows:
         (d)  A person who is a surviving dependent of an annuitant
  may secure group health coverage after the death of the annuitant
  without evidence of the person's insurability if the annuitant was
  eligible to participate in the group benefits program of a
  retirement system named in this chapter but was not participating
  at the time of the individual's death.
         (e)  A surviving dependent seeking group coverage under
  Subsection (d):
               (1)  must apply for the coverage not later than the 30th
  day after the date on which the individual who was eligible to
  participate in the group benefits program dies; and
               (2)  shall pay for the coverage at the group rate as
  provided by Subsection (b).
         SECTION 21.  Section 1551.354, Insurance Code, is amended by
  amending Subsection (b) and adding Subsections (c) and (d) to read
  as follows:
         (b)  The executive director may cause the filing of an action
  for interpleader [a suit] concerning the claim in a district court
  in Travis County on behalf of the Employees Retirement System of
  Texas to protect the group coverage plan from double or multiple
  liability.
         (c)  A person may not pursue a counterclaim or other cause of
  action against the retirement system or its trustees, officers,
  employees, carriers, or administering firms in connection with the
  transactions and occurrences related to the interpleader action.
         (d)  A person who files suit against the retirement system or
  its trustees, officers, employees, carriers, or administering
  firms is liable for the costs and attorney's fees incurred in
  violation of Subsection (c).
         SECTION 22.  Subchapter H, Chapter 1551, Insurance Code, is
  amended by adding Section 1551.362 to read as follows:
         Sec. 1551.362.  SUBPOENA. Notwithstanding any other law,
  the executive director or the executive director's designee may
  issue a subpoena that conforms to Rule 176, Texas Rules of Civil
  Procedure, including a preappeal investigative subpoena or any
  subpoena otherwise authorized by the Texas Rules of Civil
  Procedure, that the executive director or designee determines
  necessary to protect the interests of a program or system
  administered by the retirement system.
         SECTION 23.  Section 1551.401, Insurance Code, is amended by
  adding Subsection (g) to read as follows:
         (g)  Except as provided by Section 1551.259(d), the
  retirement system may deposit to the credit of the fund any
  unclaimed money on a finding that a good faith effort has been made
  to locate the person entitled to the money.
         SECTION 24.  The following laws are repealed:
               (1)  Section 812.006, Government Code;
               (2)  Section 833.1035(c), Government Code;
               (3)  Section 833.104, Government Code;
               (4)  Section 835.1015(c), Government Code;
               (5)  Section 838.1035(c), Government Code;
               (6)  Section 838.104, Government Code;
               (7)  Section 840.1025(c), Government Code;
               (8)  Section 840.1027(c), Government Code; and
               (9)  Section 1551.221, Insurance Code.
         SECTION 25.  Sections 811.010 and 815.214, Government Code,
  and Section 1551.362, Insurance Code, as added by this Act, and
  Sections 815.512, Government Code, and 1551.354, Insurance Code, as
  amended by this Act, apply only to an action filed by or against the
  Employees Retirement System of Texas, the trustees, officers, or
  employees of the retirement system, or an administrator, carrier,
  or other governmental agency acting in cooperation with or on
  behalf of the retirement system on or after the effective date of
  this Act. An action filed before the effective date of this Act is
  governed by the law in effect when the action was filed, and that
  law is continued in effect for that purpose.
         SECTION 26.  Section 814.203(b), Government Code, as added
  by this Act, applies only to an application for disability
  retirement filed with the Employees Retirement System of Texas on
  or after the effective date of this Act. An application filed
  before the effective date of this Act is subject to the law in
  effect on the date the application was filed, and that law is
  continued in effect for that purpose.
         SECTION 27.  Section 837.003(e), Government Code, as added
  by this Act, applies only to a service retirement, disability
  retirement, or death benefit annuity that becomes payable by the
  Judicial Retirement System of Texas Plan Two on or after the
  effective date of this Act. A service retirement, disability
  retirement, or death benefit annuity that becomes payable by the
  Judicial Retirement System of Texas Plan Two before the effective
  date of this Act is governed by the law in effect on the date the
  annuity becomes payable, and that law is continued in effect for
  that purpose.
         SECTION 28.  Section 838.106(c), Government Code, as added
  by this Act, applies only to the establishment of service credit by
  a member of the Judicial Retirement System of Texas Plan Two who
  leaves office on or after the effective date of this Act. The
  establishment of service credit of a member of the Judicial
  Retirement System of Texas Plan Two who leaves office before the
  effective date of this Act is governed by the law in effect when the
  member leaves office, and that law is continued in effect for that
  purpose.
         SECTION 29.  This Act takes effect September 1, 2009.