By: Duncan S.B. No. 1664
 
 
 
   
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the powers and duties of and benefits available under
  the Employees Retirement System of Texas.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter A, Chapter 609, Government Code, is
  amended by adding Section 609.015 to read as follows:
         Sec. 609.015.  BENEFICIARY CAUSING DEATH OF PARTICIPATING
  EMPLOYEE.  (a)  Any benefits, funds, or account balances payable on
  the death of a participating employee may not be paid to a person
  convicted or adjudged of causing that death but instead is payable
  as if the convicted person had predeceased the decedent.
         (b)  The plan is not required to change the recipient of
  benefits under this section unless is receives actual notice of the
  conviction or adjudication of a beneficiary.  However, the plan may
  delay payment of a benefit payable on the death of a member or
  annuitant pending the results of a criminal investigation or civil
  proceeding and of legal proceedings relating to the cause of death.
         (c)  For the purposes of this section, a person has been
  convicted or adjudicated of causing the death of a participating
  employee if the person:
               (1)  pleads guilty or nolo contendere to, or is found
  guilty by a court or jury in a criminal proceeding of, causing the
  death of the participating employee, regardless of whether sentence
  is imposed or probated, and has no appeal of the conviction pending
  and the time provided for appeal has expired; or
               (2)  is found liable by a court or jury in a civil
  proceeding of causing the death of the participating employee, and
  has no appeal of the judgement pending and the time provided for
  appeal has expired.
         SECTION 2.  Section 813.404, Government Code, is amended to
  read as follows:
         Sec. 813.404.  CONTRIBUTIONS FOR SERVICE NOT PREVIOUSLY
  ESTABLISHED. For each month of membership, military, or equivalent
  membership service not previously credited in the retirement
  system, a member claiming credit in the elected class shall pay a
  contribution in an amount equal to the greater of:
               (1)  eight percent of the monthly salary paid to
  members of the legislature at the time the credit is established; or
               (2)  the appropriate member contribution set by Section
  815.402 for [six percent of the monthly state salary paid to] a
  person who holds, at the time the credit is established, the office
  for which credit is sought.
         SECTION 3.  Section 813.505(a), Government Code, is amended
  to read as follows:
         (a)  A member claiming credit in the employee class for
  membership service not previously established shall, for each month
  of the service, pay a contribution in an amount equal to the greater
  of:
               (1)  the appropriate member contribution set by Section
  815.402 [six percent of the member's monthly state compensation]
  for the service during the time for which credit is sought; or
               (2)  $18.
         SECTION 4.  Section 814.104(d), Government Code, is amended
  to read as follows:
         (d)  Except as provided by Section 814.102 or by rule adopted
  under Section 813.304(d) or 803.202(a)(2), a member who was not a
  member on the date hired, was hired on or after September 1, 2009,
  and has service credit in the retirement system is eligible to
  retire and receive a service retirement annuity if the member:
               (1)  is at least 65 years old and has at least 10 years
  of service credit in the employee class; or
               (2)  has at least 10 [5] years of service credit in the
  employee class and the sum of the member's age and amount of service
  credit in the employee class, including months of age and credit,
  equals or exceeds the number 80.
         SECTION 5.  Section 814.1075(d), Government Code, is amended
  to read as follows:
         (d)  The standard combined service retirement annuity that
  is payable under this section is based on retirement at either the
  age of 55 or the age at which the sum of the member's age and amount
  of service credit in the employee class equals or exceeds the number
  80.  The annuity of a law enforcement or custodial officer who
  retires before reaching the age of 55 under any eligibility
  criteria is actuarially reduced by five percent for each year the
  member retires before the member reaches age 55, with a maximum
  possible reduction of 25 percent.  The actuarial reduction
  described by this section is in addition to any other actuarial
  reduction required by law.
         SECTION 6.  Section 815.303, Government Code, is amended to
  read as follows:
         Sec. 815.303.  SECURITIES LENDING. (a)  The retirement
  system may, in the exercise of its constitutional discretion to
  manage the assets of the retirement system, select one or more
  commercial banks, depository trust companies, or other entities to
  serve as custodian or custodians of the system's securities and to
  lend the securities under rules or policies adopted by the board of
  trustees and as required by this section.
         (b)  To be eligible to lend securities under this section, a
  bank or brokerage firm must:
               (1)  be experienced in the operation of a fully secured
  securities loan program;
               (2)  maintain adequate capital in the prudent judgment
  of the retirement system to assure the safety of the securities;
               (3)  execute an indemnification agreement satisfactory
  in form and content to the retirement system fully indemnifying the
  retirement system against loss resulting from borrower default in
  its operation of a securities loan program for the system's
  securities; and
               (4)  require any securities broker or dealer to whom it
  lends securities belonging to the retirement system to deliver to
  and maintain with the securities lending agent or custodian
  collateral in the form of cash, [or] United States government
  securities, or United States government agency securities in an
  amount equal to but not less than 100 percent of the market value,
  from time to time, as determined by the retirement system, of the
  loaned securities.
         SECTION 7.  Subchapter D, Chapter 834, Government Code, is
  amended by adding Section 834.305 to read as follows:
         Sec. 834.305.  BENEFICIARY CAUSING DEATH OF MEMBER OR
  ANNUITANT.  (a)  Any benefits, funds, or account balances payable
  on the death of a member or annuitant may not be paid to a person
  convicted or adjudged of causing that death but instead is payable
  as if the convicted person had predeceased the decedent.
         (b)  A person who becomes eligible under this section to
  select death or survivor benefits may select benefits as if the
  person were the designated beneficiary.
         (c)  The retirement system shall reduce any annuity computed
  in the part on the age of the convicted or adjudicated person to a
  lump sum equal to the present value of the remainder of the annuity.  
  The reduced amount is payable to a person entitled as provided by
  this section to receive the benefit.
         (d)  The retirement system is not required to change the
  recipient of benefits under this section unless it receives actual
  notice of the conviction or adjudication of a beneficiary.  
  However, the retirement system may delay payment of a benefit
  payable on the death of a member or annuitant pending the results of
  a criminal investigation or civil proceeding and of legal
  proceedings relating to the cause of death.
         (e)  For the purposes of this section, a person has been
  convicted or adjudicated of causing the death of a member or
  annuitant if the person:
               (1)  pleads guilty or nolo contendere to, or is found
  guilty by a court or jury in a criminal proceeding of, causing the
  death of the member or annuitant, regardless of whether sentence is
  imposed or probated, and has no appeal of the conviction pending and
  the time provided for appeal has expired; or
               (2)  is found liable by a court or jury in a civil
  proceeding of causing the death of the member or annuitant, and has
  no appeal of the judgment pending and the time provided for appeal
  has expired.
         SECTION 8.  Subchapter D, Chapter 839, Government Code, is
  amended by adding Section 839.306 to read as follows:
         Sec. 839.306.  BENEFICIARY CAUSING DEATH OF MEMBER OR
  ANNUITANT.  (a)  Any benefits, funds, or account balances payable
  on the death of a member or annuitant may not be paid to a person
  convicted or adjudged of causing that death but instead is payable
  as if the convicted person had predeceased the decendent.
         (b)  A person who becomes eligible under this section to
  select death or survivor benefits may select benefits as if the
  person were the designated beneficiary.
         (c)  The retirement system shall reduce any annuity computed
  in part on the age of the convicted or adjudicated person to a lump
  sum equal to the present value of the remainder of the annuity.  The
  reduced amount is payable to a person entitled as provided by this
  section to receive the benefit.
         (d)  The retirement system is not required to change the
  recipient of benefits under this section unless it receives actual
  notice of the conviction or adjudication of a beneficiary.  
  However, the retirement system may delay payment of a benefit
  payable on the death of a member or annuitant pending the results of
  a criminal investigation or civil proceeding and of legal
  proceedings relating to the cause of death.
         (e)  For the purposes of this section, a person has been
  convicted or adjudicated of causing the death of a member or
  annuitant if the person:
               (1)  pleads guilty or nolo contendere to, or is found
  guilty by a court or jury in a criminal proceeding of, causing the
  death of the member or annuitant, regardless of whether sentence is
  imposed or probated, and has no appeal of the conviction pending and
  the time provided for appeal has expired; or
               (2)  is found liable by a court or jury in a civil
  proceeding of causing the death of the member or annuitant, and has
  no appeal of the judgment pending and the time provided for appeal
  has expired.
         SECTION 9.  Section 1551.004(a), Insurance Code, is amended
  to read as follows:
         (a)  In this chapter, "dependent" with respect to an
  individual eligible to participate in the group benefits program
  [under Section 1551.101 or 1551.102] means the individual's:
               (1)  spouse;
               (2)  unmarried child younger than 25 years of age;
               (3)  child of any age who the board of trustees
  determines lives with or has the child's care provided by the
  individual on a regular basis if:
                     (A)  the child is mentally [retarded] or
  physically incapacitated to the extent that the child is dependent
  on the individual for care or support, as determined by the board of
  trustees;
                     (B)  the child's coverage under this chapter has
  not lapsed; and
                     (C)  the child is at least 25 years old and was
  enrolled as a participant in the health benefits coverage under the
  group benefits program on the date of the child's 25th birthday;
               (4)  child of any age who is unmarried, for purposes of
  health benefit coverage under this chapter, on expiration of the
  child's continuation coverage under the Consolidated Omnibus
  Budget Reconciliation Act of 1985 (Pub. L. No. 99-272) and its
  subsequent amendments; and
               (5)  ward, as that term is defined by Section 601, Texas
  Probate Code, younger than 25 years of age.
         SECTION 10.  Subchapter B, Chapter 1551, Insurance Code, is
  amended by adding Section 1551.068 to read as follows:
         Sec. 1551.068.  QUALIFICATION OF GROUP BENEFITS PROGRAM.  
  Notwithstanding any other law, it is intended that the provisions
  of this chapter be construed and administered in a manner that
  coverages under the group benefits program will be considered in
  compliance with applicable federal laws and regulations.  The board
  of trustees may adopt rules that modify provisions of the this
  chapter by adding, deleting, or changing a provision, including
  rules that modify eligibility or enrollment requirements and
  benefits available under any group benefits program coverages.
         SECTION 11.  Section 1551.314, Insurance Code, is amended to
  read as follows:
         Sec. 1551.314.  CERTAIN STATE CONTRIBUTIONS PROHIBITED.  A
  state contribution may not be made for coverages under this chapter
  selected by an individual who receives a state contribution[, other
  than as a spouse, dependent, or beneficiary,] for coverages under a
  group benefits program provided by another state plan or by an
  institution of higher education, as defined by Section 61.003,
  Education Code.
         SECTION 12.  The change in law made by Sections 609.015,
  834.305, and 839.306, Government Code, as added by this Act, apply
  only to an offense committed on or after the effective date of this
  Act.  An offensive comitted before the effective date of this Act is
  governed by the law in effect on the date the offense was committed,
  and the former law is continued in effect for that purpose.  For
  purposes of this section, an offense was committed before the
  effective date of this Act if any element of the offense occurred
  before that date.
         SECTION 13.  This Act takes effect September 1, 2011.