81R7150 KFF-F

By: Miller of Comal, Herrero H.B. No. 2656

A BILL TO BE ENTITLED

AN ACT

relating to the composition of the board of trustees of the Teacher Retirement System of Texas.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 821.001(5), Government Code, is amended to read as follows:

(5) "Board of trustees" means the persons [board] appointed or elected under this subtitle to administer the retirement system.

SECTION 2. The heading to Section 825.002, Government Code, is amended to read as follows:

Sec. 825.002. APPOINTMENT AND ELECTION OF TRUSTEES [APPOINTED BY GOVERNOR].

SECTION 3. Sections 825.002(a), (d), (f), and (g), Government Code, are amended to read as follows:

(a) The governor shall appoint, with the advice and consent of the senate and as provided by this section, six [seven] members of the board of trustees.

(d) Two trustees who are [The governor shall appoint one member of the board from a slate of three] former members of the retirement system who have retired and are receiving benefits from the retirement system shall be elected [and who have been nominated in accordance with Subsections (f) and (g)] by [the] persons who have retired and are receiving benefits from the retirement system. The two members elected under this subsection hold office for staggered terms.

(f) Persons considered for nomination under Subsection (c)[, (d),] or (e) or elected under Subsection (d) must have been nominated or elected, as appropriate, by written ballot at an election conducted under rules adopted by the board of trustees.

(g) To provide for the election [nomination of persons for appointment] under Subsection (d), the board shall send to each retiree of the retirement system:

(1) notice of the deadline for filing as a candidate for election [nomination];

(2) information on procedures to follow in filing as a candidate; and

(3) a written ballot.

SECTION 4. Section 825.003, Government Code, is amended to read as follows:

Sec. 825.003. TRUSTEES APPOINTED BY GOVERNOR FROM NOMINEES OF BOARD OF EDUCATION. The governor shall appoint one member [two members] of the board of trustees, subject to confirmation by two-thirds of the senate, from lists of nominees submitted by the State Board of Education. The member appointed under this subsection [These members] must be a person [persons] who has [have] demonstrated financial expertise, has [have] worked in private business or industry, and has [have] broad investment experience, preferably in investment of pension funds.

SECTION 5. Sections 825.0032(a) and (b), Government Code, are amended to read as follows:

(a) Except as provided by Subsection (b), a person is not eligible for appointment or election to the board of trustees if the person or the person's spouse:

(1) is employed by or participates in the management of a business entity or other organization receiving funds from the retirement system;

(2) owns or controls, directly or indirectly, more than a 10 percent interest in a business entity or other organization receiving funds from the retirement system; or

(3) uses or receives a substantial amount of tangible goods, services, or funds from the retirement system, other than compensation or reimbursement authorized by law for board of trustees membership, attendance, or expenses.

(b) Subsection (a) does not apply to employment by, participation in the management of, or ownership or control of an interest in a business entity or other organization on behalf of the retirement system. Subsection (a)(3) does not apply to a person who is appointed or elected [nominated for appointment] under Section 825.002(c), (d), or (e).

SECTION 6. Sections 825.0041(a) and (c), Government Code, are amended to read as follows:

(a) A person who is appointed or elected to and qualifies for office as a member of the board of trustees may not vote, deliberate, or be counted as a member in attendance at a meeting of the board until the person completes a training program that complies with this section.

(c) A person appointed or elected to the board of trustees is entitled to reimbursement under Section 825.007 for the travel expenses incurred in attending the training program regardless of whether the attendance at the program occurs before or after the person qualifies for office.

SECTION 7. Sections 825.010(a) and (c), Government Code, are amended to read as follows:

(a) It is a ground for removal from the board of trustees that a trustee:

(1) does not have at the time of taking office the qualifications required for the trustee's position;

(2) does not maintain during service on the board the qualifications required for the trustee's position;

(3) violates a prohibition established by Section 825.002(b) or 825.0032 applicable to the trustee;

(4) cannot because of illness or disability discharge the trustee's duties for a substantial part of the term for which the trustee is appointed or elected; or

(5) is absent from more than half of the regularly scheduled board meetings that the person is eligible to attend during a calendar year without an excuse approved by a majority vote of the board.

(c) If the executive director has knowledge that a potential ground for removal exists, the executive director shall notify the presiding officer of the board of trustees of the ground. The presiding officer shall then notify the governor [appropriate appointing officer] and the attorney general that a potential ground for removal exists. If the potential ground for removal involves the presiding officer, the executive director shall notify the next highest officer of the board, who shall notify the governor [appropriate appointing officer] and the attorney general that a potential ground for removal exists.

SECTION 8. (a) This Act applies only to the appointment or election of a trustee of the board of trustees of the Teacher Retirement System of Texas that occurs on or after the effective date of this Act.

(b) A person who is serving as a trustee immediately before the effective date of this Act may complete the trustee's term of office, and the trustee's qualifications for serving as a trustee are governed by the law in effect immediately before the effective date of this Act until the date that trustee's term expires.

SECTION 9. This Act takes effect September 1, 2009.