| |
| |
|
|
A BILL TO BE ENTITLED
|
|
|
AN ACT
|
|
|
relating to a biennial study and report by the Employees Retirement |
|
|
System of Texas and Teacher Retirement System of Texas on |
|
|
converting to a defined contribution plan. |
|
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
|
SECTION 1. Subchapter F, Chapter 815, Government Code, is |
|
|
amended by adding Section 815.5105 to read as follows: |
|
|
Sec. 815.5105. BIENNIAL STUDY AND REPORT ON CONVERTING TO |
|
|
DEFINED CONTRIBUTION PLAN. (a) Not later than January 1 of each |
|
|
odd-numbered year, the retirement system shall: |
|
|
(1) conduct a study to evaluate the cost and |
|
|
feasibility of converting from providing benefits to members |
|
|
primarily under a defined benefit plan to providing benefits to |
|
|
members primarily under a defined contribution plan; and |
|
|
(2) submit a written report to each member of the |
|
|
legislature containing the findings of the study. |
|
|
(b) The report required under this section must: |
|
|
(1) evaluate the following two conversion scenarios: |
|
|
(A) a conversion under which all persons who are |
|
|
members of the system as of January 1 of the next odd-numbered year |
|
|
are required to transition to a defined contribution plan; and |
|
|
(B) a conversion under which only employees or |
|
|
officers initially hired, appointed, or elected on or after January |
|
|
1 of the next odd-numbered year are required to participate in a |
|
|
defined contribution plan; and |
|
|
(2) include: |
|
|
(A) a broad description of how each conversion |
|
|
scenario described by Subdivision (1) would be achieved, including |
|
|
a projected timeline for the various stages of conversion; |
|
|
(B) a detailed estimate of the costs to the state |
|
|
associated with each conversion scenario, including a detailed |
|
|
estimate of the costs to the state associated with maintaining the |
|
|
defined benefit plan for retirees and beneficiaries entitled to |
|
|
benefits under that plan; |
|
|
(C) a summary of the assumptions and methods used |
|
|
to estimate costs under Paragraph (B); |
|
|
(D) recommendations for legislation the system |
|
|
determines would be necessary to accomplish conversion under each |
|
|
conversion scenario; and |
|
|
(E) any additional information the system |
|
|
determines appropriate. |
|
|
(c) The report required by this section may be combined with |
|
|
any other report required by law. |
|
|
SECTION 2. Subchapter B, Chapter 825, Government Code, is |
|
|
amended by adding Section 825.1085 to read as follows: |
|
|
Sec. 825.1085. BIENNIAL STUDY AND REPORT ON CONVERTING TO |
|
|
DEFINED CONTRIBUTION PLAN. (a) Not later than January 1 of each |
|
|
odd-numbered year, the retirement system shall: |
|
|
(1) conduct a study to evaluate the cost and |
|
|
feasibility of converting from providing benefits to members |
|
|
primarily under a defined benefit plan to providing benefits to |
|
|
members primarily under a defined contribution plan; and |
|
|
(2) submit a written report to each member of the |
|
|
legislature containing the findings of the study. |
|
|
(b) The report required under this section must: |
|
|
(1) evaluate the following two conversion scenarios: |
|
|
(A) a conversion under which all persons who are |
|
|
members of the system as of January 1 of the next odd-numbered year |
|
|
are required to transition to a defined contribution plan; and |
|
|
(B) a conversion under which only employees |
|
|
initially hired on or after January 1 of the next odd-numbered year |
|
|
are required to participate in a defined contribution plan; and |
|
|
(2) include: |
|
|
(A) a broad description of how each conversion |
|
|
scenario described by Subdivision (1) would be achieved, including |
|
|
a projected timeline for the various stages of conversion; |
|
|
(B) a detailed estimate of the costs to the state |
|
|
associated with each conversion scenario, including a detailed |
|
|
estimate of the costs to the state associated with maintaining the |
|
|
defined benefit plan for retirees and beneficiaries entitled to |
|
|
benefits under that plan; |
|
|
(C) a summary of the assumptions and methods used |
|
|
to estimate costs under Paragraph (B); |
|
|
(D) recommendations for legislation the system |
|
|
determines would be necessary to accomplish conversion under each |
|
|
conversion scenario; and |
|
|
(E) any additional information the system |
|
|
determines appropriate. |
|
|
(c) The report required by this section may be combined with |
|
|
any other report required by law. |
|
|
SECTION 3. This Act takes effect September 1, 2021. |