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A BILL TO BE ENTITLED
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AN ACT
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relating to the powers and duties of and contributions to and |
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benefits from the systems and programs administered by the |
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Employees Retirement System of Texas. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 411.1402(a), Government Code, is amended |
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to read as follows: |
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(a) The Employees Retirement System of Texas is entitled to |
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obtain from the department, the Federal Bureau of Investigation |
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Criminal Justice Information Services Division, or another law |
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enforcement agency criminal history record information maintained |
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by the department, division, or agency that relates to a person who |
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is: |
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(1) an applicant for employment with, or who is or has |
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been employed by, the retirement system; |
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(2) a consultant, contract employee, independent |
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contractor, intern, or volunteer for the retirement system or an |
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applicant to serve in one of those positions; or |
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(3) a candidate for appointment or election to the |
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board of trustees of the retirement system or an advisory committee |
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to that board. |
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SECTION 2. Section 661.091(a), Government Code, is amended |
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to read as follows: |
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(a) A contributing member of the Employees Retirement |
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System of Texas who retires is entitled to a lump-sum payment [be
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paid in a lump sum], from funds of the agency or department from |
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which the member retires, for the member's accrued vacation time as |
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of the date of retirement, unless the member opts to receive for |
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that accrued vacation time service credit under Section 813.511(a). |
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SECTION 3. Section 811.007, Government Code, is amended to |
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read as follows: |
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Sec. 811.007. IMMUNITY FROM LIABILITY. The board of |
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trustees, executive director, members of an advisory committee |
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appointed by the board of trustees, and employees of the retirement |
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system are not liable for any action taken or omission made or |
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suffered by them in good faith in the performance of any duty in |
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connection with any program or system administered by the |
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retirement system. |
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SECTION 4. Section 812.003(b), Government Code, is amended |
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to read as follows: |
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(b) An office or employment that is included in the coverage |
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of the Teacher Retirement System of Texas, the Judicial Retirement |
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System of Texas Plan One, or the Judicial Retirement System of Texas |
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Plan Two or, except as provided by Section 9.01, Chapter 238 |
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(S.B. 378), Acts of the 73rd Legislature, Regular Session, 1993, is |
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with a university system or institution of higher education, as |
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defined by Section 61.003, Education Code, is not a position with a |
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department, commission, board, agency, or institution of the state |
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for purposes of this subtitle. |
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SECTION 5. Section 813.202(c), Government Code, is amended |
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to read as follows: |
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(c) The state shall contribute for service established |
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under this section an amount in the same ratio to the member's |
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contribution and interest paid under Subsection (b) for the service |
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as the state's contribution bears to the contribution for current |
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service required of a member of the employee class at the time the |
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service is established under this section. The state's |
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contribution and interest must be paid from the fund or account from |
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which the member receives compensation at the time the service is |
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established or, if the member does not hold a position at the time |
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the service is established, from the fund or account from which the |
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member received compensation when the member most recently held a |
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position. |
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SECTION 6. Section 813.302(b), Government Code, is amended |
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to read as follows: |
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(b) A member eligible to establish military service credit |
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is one who: |
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(1) does not receive and is not eligible to receive |
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federal retirement payments based on 20 years or more of active |
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federal military duty [or its equivalent]; |
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(2) has been released from military duty under |
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conditions not dishonorable; and |
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(3) has credit in the retirement system for membership |
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service performed after the member's date of release from active |
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military duty. |
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SECTION 7. Section 813.509(k), Government Code, is amended |
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to read as follows: |
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(k) A member [who was not a member on the date hired and was
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hired on or after September 1, 2009,] or a death benefit beneficiary |
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of that member may use sick leave creditable under this section only |
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for purposes of calculating the member's or beneficiary's annuity. |
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SECTION 8. Sections 813.511(a) and (j), Government Code, |
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are amended to read as follows: |
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(a) A member who holds a position included in the employee |
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class of membership during the month that includes the effective |
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date of the member's retirement and who retires based on service or |
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a disability is entitled to service credit in the retirement system |
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for the member's annual leave that has accumulated and is unused on |
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the last day of employment, unless the member opts to receive for |
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that accumulated leave a lump-sum payment under Section 661.091. |
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(j) A member [who was not a member on the date hired and was
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hired on or after September 1, 2009,] or a death benefit beneficiary |
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of that member may use annual leave creditable under this section |
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only for purposes of calculating the member's or beneficiary's |
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annuity. |
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SECTION 9. Sections 814.105(a) and (d), Government Code, |
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are amended to read as follows: |
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(a) The [Except as otherwise provided by this section, the] |
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standard service retirement annuity for service credited in the |
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employee class of membership is an amount computed as the member's |
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average monthly compensation for service in that class for the 60 |
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[36] highest months of compensation multiplied by 2.3 percent for |
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each year of service credit in that class. |
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(d) The standard service retirement annuity computed under |
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this section [Subsection (c)] is reduced by five percent for each |
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year the member retires before the member reaches age 62 [60, with a
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maximum possible reduction of 25 percent]. |
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SECTION 10. Section 814.107, Government Code, is amended by |
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amending Subsections (b) and (c) and adding Subsection (c-1) to |
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read as follows: |
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(b) The standard service retirement annuity payable for at |
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least 20 years of service credit as a law enforcement or custodial |
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officer is an amount computed on the basis of the member's average |
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monthly compensation for the 60 [36] highest months of compensation |
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in the employee class, times the sum of the percentage factor used |
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in the computation of a standard service retirement annuity under |
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Section 814.105 plus .5 percent. |
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(c) The standard combined service retirement annuity that |
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is payable under this section is based on retirement on or after the |
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attainment of the normal retirement age, which for purposes of this |
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section is the earlier of either the age of 57 [50] or the age at |
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which the sum of the member's age and amount of service credit in |
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the employee class equals the number 80. The annuity of a law |
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enforcement or custodial officer who retires before reaching the |
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age of 57 under any eligibility criteria is actuarially reduced by |
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five percent for each year of difference between the member's age at |
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retirement and 57. The actuarial reduction described by this |
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section is in addition to any other actuarial reduction required by |
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law. |
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(c-1) A law enforcement or custodial officer who retires |
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before attaining the [normal retirement] age of 50 is entitled only |
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to an annuity that is actuarially reduced from the annuity |
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available at the [normal retirement] age of 50 to the law |
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enforcement or custodial officer whose service credit annuity |
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amount is based on the sum of the member's age and amount of law |
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enforcement or custodial officer service credit and employee class |
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service credit, and is not entitled to have the annuity |
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recalculated at normal retirement age. The standard or reduced |
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annuity under this section is payable from the trust fund |
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established by Section 815.310 and the law enforcement and |
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custodial officer supplemental retirement fund in a ratio |
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determined by the retirement system. |
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SECTION 11. Section 814.1081(a), Government Code, is |
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amended to read as follows: |
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(a) A person who retired and selected an optional service |
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retirement annuity described by Section 814.108(c)(1), (c)(2), or |
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(c)(5) may change the optional annuity selection to the selection |
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of a standard service retirement annuity if: |
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(1) pursuant to a divorce decree, a court orders the |
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change in the annuity selection to a standard service retirement |
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annuity; or |
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(2) the retiree files [by filing] with the retirement |
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system a request to change the annuity selection, if the retiree |
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designated a person as beneficiary who: |
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(A) [(1)] was not at the time of designation and |
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is not currently the retiree's spouse or dependent child; or |
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(B) is not currently the retiree's spouse or |
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dependent child and [(2)] has executed since the designation a |
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written, notarized instrument that releases the retirement system |
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from any claim to the annuity by the beneficiary and that transfers |
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all [transfer and release, approved by a court of competent
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jurisdiction pursuant to a divorce decree,] of the beneficiary's |
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interest in the annuity to the retiree [and is not currently the
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retiree's spouse or dependent child]. |
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SECTION 12. Subchapter G, Chapter 814, Government Code, is |
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amended by adding Section 814.604 to read as follows: |
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Sec. 814.604. COST-OF-LIVING ADJUSTMENT. (a) The |
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retirement system shall grant a one-time cost-of-living adjustment |
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as provided by Subsections (b) and (c) on a finding by the board of |
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trustees that, as determined by an actuarial valuation: |
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(1) the amortization period for the unfunded actuarial |
|
liabilities of the retirement system does not exceed 30 years by one |
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or more years; and |
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(2) as a result of paying the adjustment, the time |
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required to amortize the unfunded actuarial liabilities of the |
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retirement system would not be increased to a period that exceeds 30 |
|
years by one or more years. |
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(b) The retirement system shall pay the cost-of-living |
|
adjustment under this section to a retiree who has been retired for |
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20 years or more on the date the board of trustees makes the finding |
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in Subsection (a), or to a beneficiary of the retiree, as an |
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increase to a monthly service retirement benefit, disability |
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retirement benefit, or death benefit, as applicable, paid under |
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this chapter for service credited in the employee class. |
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(c) A cost-of-living adjustment under this section is |
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limited to the lesser of: |
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(1) an amount equal to three percent of the monthly |
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benefit subject to the increase; or |
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(2) $100 a month. |
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SECTION 13. Section 815.311(b), Government Code, is amended |
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to read as follows: |
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(b) Interest on money in an individual account in the |
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employees saving account is earned monthly and is computed at the |
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rate of two [five] percent a year on the mean balance of the |
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member's account for the fiscal year. |
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SECTION 14. Section 815.317, Government Code, is amended by |
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adding Subsection (d) to read as follows: |
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(d) Member contributions to the fund deducted under Section |
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815.402(h): |
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(1) earn interest at the same rate as money in an |
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individual account in the employees saving account under Section |
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815.311; and |
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(2) are subject to the same computations and |
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limitations that apply to member contributions under Section |
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815.311. |
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SECTION 15. Section 815.402(a), Government Code, is amended |
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to read as follows: |
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(a) Except as provided by Section 813.201, each payroll |
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period, each department or agency of the state shall cause to be |
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deducted from each member's compensation a contribution of: |
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(1) 6.5 percent of the compensation if the member is |
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not a member of the legislature, provided that: |
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(A) if the state contribution to the retirement |
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system is computed using a percentage less than 6.5 percent, the |
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member's contribution is computed using a percentage equal to the |
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percentage used to compute the state contribution, which may not be |
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less than six percent; or |
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(B) if the state contribution to the retirement |
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system is computed using a percentage greater than 6.5 percent, the |
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member's contribution is computed using a percentage equal to the |
|
percentage used to compute the state contribution, except that the |
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member contribution may not exceed seven percent; or |
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(2) eight percent of the compensation if the member is |
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a member of the legislature. |
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SECTION 16. Section 837.002, Government Code, is amended to |
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read as follows: |
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Sec. 837.002. TERMINATION OF MEMBERSHIP. A person's |
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membership in the retirement system is terminated by: |
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(1) death of the person; |
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(2) retirement based on service credited in the |
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retirement system; or |
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(3) withdrawal of all of the person's accumulated |
|
contributions[; or
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[(4) transfer of the person's accumulated contributions
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under Section 840.401(f)]. |
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SECTION 17. Section 838.103(b), Government Code, is amended |
|
to read as follows: |
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(b) A member eligible to establish military service credit |
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is one who: |
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(1) has at least eight years of service credit in the |
|
retirement system; |
|
(2) does not receive and is not eligible to receive |
|
federal retirement payments based on 20 years or more of active |
|
federal military duty [or its equivalent]; and |
|
(3) has been released from military duty under |
|
conditions not dishonorable. |
|
SECTION 18. Sections 838.106(a) and (c), Government Code, |
|
are amended to read as follows: |
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(a) A member may establish service credit in the retirement |
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system for any calendar year during which the member[:
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[(1)] held an office included in the membership of the |
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retirement system[; or
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[(2) was eligible to take the oath for an office
|
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included in the membership of the retirement system]. |
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(c) For the purpose of Subsection (a) [(a)(1)], the term of |
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a member leaving judicial office ends not later than December 31 |
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regardless of the date on which the member's successor takes the |
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oath of office. |
|
SECTION 19. Sections 1551.003(9) and (11), Insurance Code, |
|
are amended to read as follows: |
|
(9) "Full-time employee" means an employee designated |
|
as a full-time employee under Section 1551.319(c) or (d) or an |
|
employee designated by the employer as working 30 [40] or more hours |
|
a week. |
|
(11) "Part-time employee" means an employee |
|
designated by the employer as working less than 30 [40] hours a |
|
week. For purposes of this chapter, an individual described by |
|
Section 1551.101(e)(2) is considered a part-time employee. |
|
SECTION 20. Section 1551.004(b), Insurance Code, is amended |
|
to read as follows: |
|
(b) In this section, "child" includes: |
|
(1) a natural child, adopted child, stepchild, [or] |
|
foster child, or child in the possession of a participant who is |
|
designated as managing conservator of the child under an |
|
irrevocable or unrevoked affidavit of relinquishment under Chapter |
|
161, Family Code; or |
|
(2) a child who is related by blood or marriage and was |
|
claimed as a dependent on the federal income tax return of an |
|
individual who is eligible to participate in the group benefits |
|
program under Section 1551.101 or 1551.102 for the calendar year |
|
preceding the plan year in which the child is first enrolled as a |
|
dependent under Subchapter D, and for each subsequent year in which |
|
the child is enrolled as a dependent. |
|
SECTION 21. Sections 1551.1055(a) and (b), Insurance Code, |
|
are amended to read as follows: |
|
(a) Except as provided by Subsection (c) or (d), eligibility |
|
under Section 1551.101 begins not later than [on the first day of
|
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the calendar month that begins after] the 90th day after the date |
|
the employee performs services for a state agency or is qualified |
|
for and begins to hold elected or appointed office. |
|
(b) Except as provided by Subsection (c), eligibility under |
|
Section 1551.102, for an individual who does not retire at the end |
|
of the last month for which the individual is on the payroll of a |
|
state agency before retirement, begins not later than [on the first
|
|
day of the calendar month that begins after] the 90th day after the |
|
date the individual retires. |
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SECTION 22. Section 1551.158(a), Insurance Code, is amended |
|
to read as follows: |
|
(a) A dependent child who is unmarried and whose coverage |
|
under this chapter ends when the child becomes 26 [25] years of age |
|
may, on expiration of continuation coverage under the Consolidated |
|
Omnibus Budget Reconciliation Act of 1985 (Pub. L. No. 99-272), |
|
reinstate health benefit plan coverage under this chapter if the |
|
child, or the child's participating parent, pays the full cost of |
|
the health benefit plan coverage. |
|
SECTION 23. Subchapter G, Chapter 1551, Insurance Code, is |
|
amended by adding Section 1551.3196 to read as follows: |
|
Sec. 1551.3196. AMOUNT OF CONTRIBUTION FOR CERTAIN |
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ANNUITANTS. (a) An annuitant receives the benefits of a state |
|
contribution for coverage under this chapter based on the |
|
annuitant's eligible service credit, as follows: |
|
(1) for an annuitant with 20 years or more of eligible |
|
service credit, a full state contribution; |
|
(2) for an annuitant with at least 15 years but less |
|
than 20 years of eligible service credit, 75 percent of a full state |
|
contribution; and |
|
(3) for an annuitant with less than 15 years of |
|
eligible service credit, 50 percent of a full state contribution. |
|
(b) An annuitant receiving a reduced state contribution |
|
under Subsection (a) shall have any state contribution for |
|
dependent coverage reduced in an amount proportional to the |
|
reduction under Subsection (a). |
|
(c) This section does not apply to an individual who: |
|
(1) receives or is eligible to receive an annuity that |
|
is based on eligibility under Section 814.002, 814.102, 834.101, or |
|
839.101, Government Code; or |
|
(2) is eligible to participate in the group benefits |
|
program under: |
|
(A) Section 1551.102(d) because of a disability; |
|
or |
|
(B) Section 1551.102(f). |
|
SECTION 24. (a) The following provisions of the Government |
|
Code are repealed: |
|
(1) effective September 1, 2013: |
|
(A) Section 76.006(i); |
|
(B) Section 606.030(f); and |
|
(C) Section 840.401; and |
|
(2) effective September 1, 2014: |
|
(A) Sections 813.509(d) and (e); |
|
(B) Sections 813.511(d) and (e); |
|
(C) Section 814.105(c); and |
|
(D) Section 814.1075. |
|
(b) Effective September 1, 2013, Section 1551.321, |
|
Insurance Code, is repealed. |
|
SECTION 25. (a) The changes in law made by this Act to |
|
Sections 813.509, 813.511, and 814.105, Government Code, do not |
|
apply to, and the former law is continued in effect for, a person |
|
who retires as a member of the Employees Retirement System of Texas |
|
on or after September 1, 2014, and who meets one or more of the |
|
following requirements on or before August 31, 2014: |
|
(1) the person has attained 50 years of age; |
|
(2) the sum of the person's age and amount of service |
|
credit in the retirement system equals 70 or greater; or |
|
(3) the person has at least 20 years of service credit |
|
in the retirement system. |
|
(b) The changes in law made by this Act to Section 814.107, |
|
Government Code, do not apply to, and the former law is continued in |
|
effect for, a person who retires as a member of the Employees |
|
Retirement System of Texas on or after September 1, 2014, and who |
|
meets one or more of the following requirements on or before August |
|
31, 2014: |
|
(1) the person has attained 45 years of age; or |
|
(2) the person has at least 15 years of service credit |
|
in the retirement system. |
|
(c) Only service actually credited in the Employees |
|
Retirement System of Texas, the Teacher Retirement System of Texas, |
|
or a retirement system participating in the proportionate |
|
retirement program under Chapter 803, Government Code, or service |
|
performed as a participant in the optional retirement program under |
|
Chapter 830, Government Code, on or before August 31, 2014, may be |
|
used to determine eligibility under this section. |
|
SECTION 26. Section 815.311, Government Code, as amended by |
|
this Act, applies only to interest accrued on or after January 1, |
|
2014. Interest accrued before that date is governed by the law in |
|
effect on the date the interest was accrued, and that law is |
|
continued in effect for that purpose. |
|
SECTION 27. Section 1551.3196, Insurance Code, as added by |
|
this Act, applies only to an individual who does not have 10 years |
|
of eligible service credit on September 1, 2014. An individual who |
|
has at least 10 years of eligible service credit, or is |
|
participating in the group benefits program as a retiree, on that |
|
date is governed by the law in effect on August 31, 2014, and the |
|
former law is continued in effect for that purpose. |
|
SECTION 28. (a) Except as provided by Subsections (b), (c), |
|
and (d) of this section, this Act takes effect September 1, 2013. |
|
(b) Section 815.311, Government Code, as amended by this |
|
Act, takes effect January 1, 2014. |
|
(c) Section 1551.3196, Insurance Code, as added by this Act, |
|
takes effect September 1, 2014. |
|
(d) The changes in law made by this Act to the following |
|
sections take effect September 1, 2014: |
|
(1) Section 661.091, Government Code; |
|
(2) Section 813.509, Government Code; |
|
(3) Section 813.511, Government Code; |
|
(4) Section 814.105, Government Code; |
|
(5) Section 814.107, Government Code; and |
|
(6) Section 1551.1055, Insurance Code. |