|
|
A BILL TO BE ENTITLED
|
|
AN ACT
|
|
|
relating to optional annuity increases for certain retirees and |
|
beneficiaries of the Texas Municipal Retirement System. |
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
SECTION 1. Section 853.404, Government Code, is amended by |
|
amending Subsection (c) and adding Subsection (f) to read as |
|
follows: |
|
(c) The governing body of a participating municipality that |
|
adopts an ordinance under Section 854.203 providing for increased |
|
annuities effective January 1 of a designated year may further |
|
provide in the ordinance that increases in annuities will be |
|
credited effective January 1 of each year following the designated |
|
year based on recomputations made as provided by Section 854.203(b) |
|
[854.203(b)(1)] for each year following the initial computation, |
|
and using the fraction specified in the ordinance as required under |
|
Section 854.203(b) [854.203(b)(2)] in the recomputations. |
|
(f) If an ordinance described by Subsection (c) will cease |
|
to be in effect for a future year, or if an increase in annuities |
|
specified in an ordinance described by Subsection (c) will be |
|
changed or discontinued as provided by this section, the governing |
|
body of the participating municipality shall provide notice to |
|
members and annuitants by regular mail not later than the 60th day |
|
before the date on which the ordinance will cease to be in effect or |
|
the increase will be changed or discontinued. For an annuitant who |
|
receives a periodic check or advice of deposit from the retirement |
|
system by regular mail, the notice required by this subsection must |
|
be included with the annuitant's check or advice of deposit. |
|
SECTION 2. Section 854.203, Government Code, is amended by |
|
amending Subsections (b) and (f) and adding Subsection (b-1) to |
|
read as follows: |
|
(b) The amount of annuity increase under this section is |
|
computed by one of the following methods: |
|
(1) as the sum of the prior and current service |
|
annuities on the effective date of retirement of the person on whose |
|
service the annuities are based, multiplied by: |
|
(A) [(1)] the percentage change in the Consumer |
|
Price Index for All Urban Consumers, published by the Bureau of |
|
Labor Statistics of the United States Department of Labor, from |
|
December of the year immediately preceding the effective date of |
|
the person's retirement to the December that is 13 months before the |
|
effective date of the ordinance providing the increase; and |
|
(B) [(2)] 30 percent, 50 percent, or 70 percent, |
|
as specified by the governing body in the ordinance, except that if |
|
the governing body has specified a different percentage in an |
|
ordinance adopted under Section 853.404(c) and in effect on |
|
December 31, 1999, the percentage used in computing annuity |
|
increases for retirees of that municipality remains in effect until |
|
changed or discontinued under Section 853.404; or |
|
(2) as the sum of the prior and current service |
|
annuities of the person on whose service the annuities are based on |
|
the effective date of the annuity increase multiplied by the |
|
percentage increase specified in the ordinance adopted by the |
|
governing body, except that an adjustment to an annuity after the |
|
annuity starting date for annuity increases under this subdivision |
|
may not cause an annuitant's annuity to exceed the amount that the |
|
annuitant would be entitled to had the maximum amount of the annuity |
|
increase allowed under Subdivision (1) been applied to the |
|
annuitant's annuity. |
|
(b-1) An increase under Subsection (b)(2) applies to all |
|
annuities for which the effective date of retirement of the person |
|
on whose service the annuity is based is at least 12 months before |
|
the effective date of the increase. Notwithstanding any other |
|
provision of this subtitle, each distribution of a benefit under |
|
this subtitle must be determined and made in accordance with |
|
Section 401(a)(9), Internal Revenue Code of 1986. The board of |
|
trustees may adopt rules it considers necessary to comply with the |
|
distribution requirements. |
|
(f) An increase granted to an annuitant under Subsection |
|
(b)(2), or the [The] amount by which an increase under Subsection |
|
(b)(1) [this section] exceeds all previously granted increases to |
|
an annuitant is: |
|
(1) payable as a prior service annuity; |
|
(2) [, is] an obligation of the municipality's account |
|
in the municipality accumulation fund;[,] and |
|
(3) [is] subject to reduction under Section |
|
855.308(f). |
|
SECTION 3. This Act takes effect immediately if it receives |
|
a vote of two-thirds of all the members elected to each house, as |
|
provided by Section 39, Article III, Texas Constitution. If this |
|
Act does not receive the vote necessary for immediate effect, this |
|
Act takes effect September 1, 2011. |
|
|
|
* * * * * |