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A BILL TO BE ENTITLED
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AN ACT
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relating to automatic participation by certain county employees in |
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deferred compensation plans provided by certain counties. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 609.007(c), Government Code, is amended |
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to read as follows: |
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(c) Except as provided by Section 609.1026, 609.202, or |
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609.5025, to participate in a deferred compensation plan, an |
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employee must consent in the contract to automatic payroll |
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deductions in an amount equal to the deferred amount. |
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SECTION 2. Subchapter B, Chapter 609, Government Code, is |
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amended by adding Section 609.1026 to read as follows: |
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Sec. 609.1026. AUTOMATIC PARTICIPATION BY CERTAIN COUNTY |
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EMPLOYEES; DEFAULT INVESTMENT PRODUCT. (a) In this section, |
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"electing county" means a county that elects to require automatic |
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employee participation in a deferred compensation plan under this |
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section. |
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(b) The commissioners court of a county that offers a |
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deferred compensation plan to the county's employees under this |
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subchapter may by order elect to require automatic employee |
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participation in a deferred compensation plan under this section. |
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(c) An employee of an electing county automatically |
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participates in a deferred compensation plan provided by the county |
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unless the employee affirmatively elects not to participate in the |
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plan. The employee is not required to affirmatively contract for |
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and consent to participation in a plan under this section. |
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(d) An employee participating in a deferred compensation |
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plan under this section makes a contribution of three percent of the |
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compensation earned by the employee to a default investment product |
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selected by the plan administrator based on the criteria |
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established under Section 609.113 and the order adopted under |
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Subsection (b), including requirements prescribed in accordance |
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with Subsection (g). The contribution is made by automatic payroll |
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deduction. |
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(e) At any time, an employee participating in a deferred |
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compensation plan under this section may, in accordance with the |
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order adopted by the commissioners court of the electing county, or |
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its designee, elect to end participation in the plan, to contribute |
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to a different investment product, to contribute a different amount |
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to the plan, or to designate all or a portion of the employee's |
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contribution as a Roth contribution subject to the availability of |
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a Roth contribution program. |
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(f) An electing county shall ensure that, at the time of |
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employment, each employee is informed of: |
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(1) the elections the employee may make under this |
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section; and |
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(2) the responsibilities of the employee under Section |
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609.010. |
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(g) In the order adopted under Subsection (b), the |
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commissioners court of an electing county, or its designee, shall |
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prescribe the requirements of this section. The order must ensure |
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that the operation of a deferred compensation plan under this |
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section conforms to the applicable requirements of any federal rule |
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that provides fiduciary relief for investments in qualified default |
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investment alternatives or otherwise governs default investment |
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alternatives under participant-directed individual account plans. |
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(h) The amount deducted under this section from an |
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employee's compensation is not deducted for payment of a debt and |
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the automatic payroll deduction is not garnishment or assignment of |
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wages. |
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(i) Using existing resources, the electing county shall |
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inform new employees of their automatic enrollment in a deferred |
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compensation plan and their right to opt out of enrollment. Using |
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existing resources, this information must be included as part of |
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the new employee orientation process. The county shall maintain a |
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record of a new employee's acknowledgment of receipt of information |
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regarding the ability to opt out of enrollment in a deferred |
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compensation plan. |
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SECTION 3. Section 609.1026, Government Code, as added by |
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this Act, applies only to an employee of a county subject to that |
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section who initially begins employment on or after January 1, |
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2026. |
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SECTION 4. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2025. |