AUTHOR'S / SPONSOR'S STATEMENT OF INTENT
S.B. 1286 is the result of an agreement between the Austin Fire Fighters' Relief and Retirement Fund, Austin firefighters, and the City of Austin. It formalizes an agreement that was negotiated in lieu of a salary increase for firefighters.
The proposed bill contains no increase in benefits. Instead, the city will increase its contribution rate to the fund by three percentage points of salary, spread over four years. In addition, firefighters will increase their own official contributions by three percentage points spread over six years.
The City of Austin contribution rates as a percentage of members’ earnings would be 19.05 percent in fiscal year (FY) 2011, 20.05 percent in FY 2012, 21.05 percent in FY 2013 and FY 2014, and 22.05 percent in FY 2015 and FY 2016.
Firefighters contribution rates as a percentage of their salaries would be 15.7 percent in FY 2011, 16.2 percent in FY 2012, 16.7 percent in FY 2013, 17.2 percent in FY 2014, 17.7 percent in FY 2015, 18.2 percent in FY 2016, and 18.7 percent in FY 2017.
The effect of these negotiated agreements will be a combined seven percentage point increase in contributions that will serve to fortify the retirement fund.
S.B. 1286 amends current law relating to the funding of retirement systems for firefighters in certain municipalities.
RULEMAKING AUTHORITY
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Sections 10.01(a) and (b), Chapter 183 (S.B. 598), Acts of the 64th Legislature, Regular Session, 1975 (Article 6243e.1, V.T.C.S.), as follows:
(a) Requires each municipality in which a fire department to which this Act applies is located to appropriate and contribute to the Fire Fighters' Relief and Retirement Fund (fund) an amount equal to a percentage, rather than 18.05 percent, of the compensation of all members during that month as follows:
(1) 19.05 percent, beginning on the first pay date following September 30, 2010, through the pay date immediately preceding September 30, 2011;
(2) 20.05 percent, beginning on the first pay date following September 30, 2011, through the pay date immediately preceding September 30, 2012;
(3) 21.05 percent, for 24 pay dates of the municipality beginning on the first pay date following September 30, 2012; and
(4) 22.05 percent, for all pay dates of the municipality that follow the 24 pay dates referenced in Subdivision (3) of this subsection.
(b) Requires each firefighter to pay into the fund each month a percentage, rather than 13.70 percent, of the firefighter's compensation for that month as follows:
(1) 15.70 percent, for the pay dates of the municipality following September 30, 2010, through the pay date immediately preceding September 30, 2011;
(2) 16.20 percent, beginning on the first pay date of the municipality following September 30, 2011, through the pay date immediately preceding September 30, 2012;
(3) 16.70 percent, beginning on the first pay date of the municipality following September 30, 2012, through the pay date immediately preceding September 30, 2013;
(4) 17.20 percent, beginning on the first pay date of the municipality following September 30, 2013, through the pay date immediately preceding September 30, 2014;
(5) 17.70 percent, beginning on the first pay date of the municipality following September 30, 2014, through the pay date immediately preceding September 30, 2015;
(6) 18.20 percent, beginning on the first pay date of the municipality following September 30, 2015, through the pay date immediately preceding September 30, 2016; and
(7) 18.70 percent, for the first pay date of the municipality following September 30, 2016, and all subsequent pay dates of the municipality.
SECTION 2. Effective date: September 1, 2011.