BILL ANALYSIS

H.B. 1677

By: Rodriguez, Eddie

Pensions, Investments & Financial Services

Committee Report (Unamended)

BACKGROUND AND PURPOSE

The Austin firefighters relief and retirement fund provides retirement, disability, and death benefits to its members and beneficiaries. These benefits are funded by contributions from the City of Austin and from firefighters.  A recent collective bargaining agreement between the city and the local firefighters' association increased the city's contribution rate.  H.B. 1677 seeks to amend the applicable statute to reflect increases in the city's contribution rate, provide for increases in the contribution rate for firefighters, and address an administrative issue involving the nomination and election of the fund's new trustees.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

H.B. 1677 amends the law governing a firefighters relief and retirement fund in a municipality with a population of more than 600,000 and less than 700,000, to authorize the fund's board of trustees, if only one member is nominated for a position on the board that is to be filled by election, to appoint the sole nominated candidate at the first board meeting in January instead of holding an election.  The bill requires the board of trustees to adopt procedures for the appointment of a sole nominated candidate in such cases and establishes that a board member appointed in such a case is considered an elected board member for purposes of the law.  The bill requires the board of a retirement system subject to the law to adopt the required procedures before a sole nominated candidate may be appointed to the board. 

H.B. 1677  increases the municipality's rate of contribution to the fund from 18.05 percent of the compensation of all members during that month to the following percentages for the specified periods: 19.05 percent, beginning on the first pay date following September 30, 2010, through the pay date immediately preceding September 30, 2011; 20.05 percent from the pay date after that last pay date through the pay date immediately preceding September 30, 2012; 21.05 percent for 24 pay dates beginning on the first pay date following September 30, 2012; and 22.05 percent for all subsequent pay dates.

H.B. 1677 increases each firefighter's rate of contribution to the fund from 13.70 percent of the firefighter's compensation for the month to the following percentages for the specified periods: 15.70 percent for the pay dates of the municipality following September 30, 2010, through the pay date immediately preceding September 30, 2011; 16.20 percent from the pay date after that last pay date through the pay date immediately preceding September 30, 2012; 16.70 percent from the pay date after that last pay date through the pay date immediately preceding September 30, 2013; 17.20 percent from the pay date after that last pay date through the pay date immediately preceding September 30, 2014; 17.70 percent from the pay date after that last date through the pay date immediately preceding September 30, 2015; 18.20 from the pay date after that last date through the pay date immediately preceding September 30, 2016; and 18.70 percent for the first pay date following September 30, 2016, and each subsequent pay date.

EFFECTIVE DATE

September 1, 2011.