BILL ANALYSIS

H.B. 2434

By: Plesa

Pensions, Investments & Financial Services

Committee Report (Unamended)

BACKGROUND AND PURPOSE

The bill author has informed the committee that the Employees Retirement System of Texas (ERS) allows its members to purchase service credit for the 90-day waiting period that occurs after beginning employment or holding office but that current law lacks clarity on whether members who experience multiple 90-day waiting periods during their careers are eligible to purchase service credit for each of those periods. The bill author has also informed the committee that this ambiguity has created confusion for ERS members seeking to account for their full service time and that there is no clear guidance on the treatment of service credit when a member's most recent date of hiring is different from the start of the service period for which they wish to purchase credit. H.B. 2434 seeks to resolve this issue by explicitly allowing eligible ERS members to purchase service credit in the employee class for each month of any 90-day waiting period in which they performed service, even if no contribution was made during that period.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

H.B. 2434 amends the Government Code to authorize a member of the Employees Retirement System of Texas (ERS) who became a member before September 1, 2015, to establish service credit in the employee class for each month of any 90-day waiting period in which the member performed service, regardless of whether the member made a contribution during the 90-day waiting period for which the member establishes service credit. The bill requires ERS to consider the date of hiring for such a member who purchases service credit in the employee class for a month that occurred before the member's most recent date of hiring to be the first day of the month of the earliest month for which service credit is purchased. The bill requires ERS to compute the amount of the deposit required for establishing the service credit in a manner that does not result in an actuarial loss to ERS.

EFFECTIVE DATE

September 1, 2025.