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A BILL TO BE ENTITLED
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AN ACT
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relating to requiring certain public retirement systems to |
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implement funding soundness plans. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 801.209(a), Government Code, is amended |
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to read as follows: |
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(a) For each public retirement system, the board shall post |
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on the board's Internet website, or on a publicly available website |
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that is linked to the board's website, the most recent data from |
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reports received under Sections 802.101, 802.103, 802.104, |
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802.105, 802.108, 802.2015, [and] 802.2016, and 802.2017. |
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SECTION 2. Sections 802.002(a) and (c), Government Code, |
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are amended to read as follows: |
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(a) Except as provided by Subsection (b), the Employees |
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Retirement System of Texas, the Teacher Retirement System of Texas, |
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the Texas County and District Retirement System, the Texas |
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Municipal Retirement System, and the Judicial Retirement System of |
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Texas Plan Two are exempt from Sections 802.101(a), 802.101(b), |
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802.101(d), 802.102, 802.103(a), 802.103(b), 802.2015, 802.2016, |
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802.2017, 802.202, 802.203, 802.204, 802.205, 802.206, and |
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802.207. The Judicial Retirement System of Texas Plan One is exempt |
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from all of Subchapters B and C except Sections 802.104 and 802.105. |
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The optional retirement program governed by Chapter 830 is exempt |
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from all of Subchapters B and C except Section 802.106. |
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(c) Notwithstanding any other law, a defined contribution |
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plan is exempt from Sections 802.101, 802.1012, 802.1014, 802.103, |
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802.104, 802.2017, and 802.202(d). This subsection may not be |
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construed to exempt any plan from Section 802.105 or 802.106(h). |
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SECTION 3. Subchapter C, Chapter 802, Government Code, is |
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amended by adding Section 802.2017 to read as follows: |
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Sec. 802.2017. FUNDING SOUNDNESS PLANS FOR CERTAIN PUBLIC |
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RETIREMENT SYSTEMS. (a) In this section, "governmental entity" |
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has the meaning assigned by Section 802.1012. |
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(b) If, on September 1, 2019, a public retirement system's |
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most recent actuarial valuation indicates that the system's |
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amortization period for the system's unfunded actuarial accrued |
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liability exceeds 30 years but does not exceed 40 years: |
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(1) the governing body of the system shall notify its |
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associated governmental entity in writing of that fact; and |
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(2) the governing body of the system and its |
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associated governmental entity jointly, or, if the system is |
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governed by Article 6243i, Revised Statutes, the system's |
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associated governmental entity solely, shall develop a written plan |
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that identifies specific measures that the system and its |
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associated governmental entity shall, in accordance with the |
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system's governing statute, implement to achieve an amortization |
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period that is within 30 years not later than the last day of the |
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system's fiscal year ending in 2022. |
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(c) If, on or after the date prescribed by Subsection |
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(b)(2), a public retirement system subject to this section receives |
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an actuarial valuation indicating that the system's actual |
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contributions: |
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(1) are sufficient to amortize the system's unfunded |
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actuarial accrued liability within 30 years, the system has |
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satisfied its obligations under this section and shall immediately |
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notify its associated governmental entity in writing of that fact; |
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or |
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(2) are not sufficient to amortize the system's |
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unfunded actuarial accrued liability within 30 years: |
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(A) the governing body of the system shall |
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notify its associated governmental entity in writing of that fact; |
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and |
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(B) the governing body of the system and its |
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associated governmental entity jointly, or, if the system is |
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governed by Article 6243i, Revised Statutes, the system's |
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associated governmental entity solely, shall formulate a funding |
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soundness restoration plan under Subsection (d). |
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(d) A funding soundness restoration plan formulated under |
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this section must: |
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(1) be developed by the public retirement system and |
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the associated governmental entity jointly, or, if the system is |
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governed by Article 6243i, Revised Statutes, by the system's |
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associated governmental entity solely, in accordance with the |
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system's governing statute; and |
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(2) be designed to achieve a contribution rate that |
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will be sufficient to amortize the unfunded actuarial accrued |
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liability within 30 years not later than the sixth anniversary of |
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the date on which the final version of a funding soundness |
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restoration plan is formulated. |
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(e) A public retirement system and an associated |
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governmental entity that formulate a funding soundness restoration |
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plan shall report any updates of progress made by the entities |
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toward improved actuarial soundness to the board each year. |
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(f) Each public retirement system and its associated |
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governmental entity or each associated governmental entity, as |
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applicable, that formulates a funding soundness restoration plan as |
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provided by this section shall submit a copy of that plan to the |
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board not later than the 31st day after the date on which the plan is |
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formulated. |
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(g) The board may adopt rules necessary to implement this |
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section, including rules that allow a public retirement system and |
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an associated governmental entity to amend a funding soundness |
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restoration plan formulated under this section. |
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(h) This section expires September 1, 2029. |
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SECTION 4. This Act takes effect September 1, 2019. |