Bill Text: TX HB3349 | 2015-2016 | 84th Legislature | Introduced
Bill Title: Relating to the retirement system in certain municipalities for firefighters and police officers.
Spectrum: Slight Partisan Bill (Democrat 6-2)
Status: (Introduced - Dead) 2015-03-30 - Left pending in committee [HB3349 Detail]
Download: Texas-2015-HB3349-Introduced.html
84R12610 TSR-F | ||
By: Rodriguez of Bexar | H.B. No. 3349 |
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relating to the retirement system in certain municipalities for | ||
firefighters and police officers. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Sections 1.02(7) and (17), Chapter 824 (S.B. | ||
817), Acts of the 73rd Legislature, Regular Session, 1993 (Article | ||
6243o, Vernon's Texas Civil Statutes), are amended to read as | ||
follows: | ||
(7) "Dependent child" means: | ||
(A) a person who is less than 18 years of age and | ||
is a child of a deceased member or deceased retiree; or | ||
(B) a person: | ||
(i) who is at least 18 years of age; | ||
(ii) who is mentally or physically disabled | ||
to the extent that the person is not capable of being | ||
self-supporting; and | ||
(iii) whose natural or adoptive parent is a | ||
deceased member or deceased retiree [ |
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(17) "Total salary" means all salary of a member: | ||
(A) including: | ||
(i) amounts picked up by the municipality | ||
under Section 4.04(b) of this Act; and | ||
(ii) amounts that would be included in | ||
salary but for an election under Section 125(d), 132(f)(4), 401(k), | ||
402(e)(3), 402(h)(1)(B), or 457(b) of the code; and | ||
(B) excluding [ |
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(i) [ |
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officer's pay, bomb squad pay, SWAT team pay, K-9 pay, and hostage | ||
team pay; and | ||
(ii) [ |
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and sick leave, holiday pay, compensatory time pay, and bonus days | ||
leave, or any similar items of compensation that may be paid in the | ||
future. | ||
SECTION 2. Section 4.02(a), Chapter 824 (S.B. 817), Acts of | ||
the 73rd Legislature, Regular Session, 1993 (Article 6243o, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
(a) If a member takes unpaid leave as provided by the | ||
federal Family and Medical Leave Act of 1993 (29 U.S.C. Section 2601 | ||
et seq.), that member is entitled to make voluntary contributions | ||
for the leave period in the same amount as the member would have | ||
paid if the member had not taken the leave. Those payments must be | ||
made not later than the 30th day after the date the member returns | ||
from that leave. A computation of contributions under this section | ||
shall be made in the same manner as other computations under this | ||
Act. A municipality to which this Act applies shall pay to the fund | ||
an amount equal to the amount the municipality would have paid under | ||
Section 4.05(a) of this Act if the contributions made by the member | ||
under this section had been made by the member under Section 4.04(a) | ||
of this Act. The payment shall be made by the municipality not | ||
later than the 30th day after the date of notification by the fund | ||
that the member has made the contributions under this section | ||
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SECTION 3. Section 4.03, Chapter 824 (S.B. 817), Acts of the | ||
73rd Legislature, Regular Session, 1993 (Article 6243o, Vernon's | ||
Texas Civil Statutes), is amended by amending Subsection (h) and | ||
adding Subsection (i) to read as follows: | ||
(h) A municipality to which this Act applies shall pay to | ||
the fund an amount equal to the amount the municipality would have | ||
paid under Section 4.05(a) of this Act if the contributions made by | ||
the member under this section had been made by the member under | ||
Section 4.04(a) of this Act. The payment shall be made by the | ||
municipality not later than the 30th day after the date of | ||
notification by the fund that the member has made the contributions | ||
under this section [ |
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(i) In the case of a member of the fund who dies while | ||
performing qualified military service as defined by Section 414(u) | ||
of the code, the survivors of the member are entitled to any | ||
additional benefits, other than benefit accruals relating to the | ||
period of qualified military service, that would have been provided | ||
if the member had returned to active service and then immediately | ||
died. | ||
SECTION 4. Sections 4.05(a), (b), and (d), Chapter 824 | ||
(S.B. 817), Acts of the 73rd Legislature, Regular Session, 1993 | ||
(Article 6243o, Vernon's Texas Civil Statutes), are amended to read | ||
as follows: | ||
(a) Except as provided by Subsection (a-1) of this section, | ||
a municipality to which this Act applies shall pay into the fund: | ||
(1) an amount equal to double the sum total of all | ||
member contributions made in accordance with Section 4.04 of this | ||
Act for full pay periods ending before October 1, 2015; and | ||
(2) an amount equal to 23.25 percent of the total | ||
salary of each fire fighter and police officer in the employment of | ||
the municipality for full pay periods ending after September 30, | ||
2015. | ||
(b) The payments into the fund by the municipality, both as | ||
to deductions and payments under Subsection (a) of this section | ||
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contributions are deducted from the members' total salary. | ||
(d) The municipality's payments to the fund | ||
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all other payments previously required by law to be made by the | ||
municipality. | ||
SECTION 5. Section 5.01, Chapter 824 (S.B. 817), Acts of the | ||
73rd Legislature, Regular Session, 1993 (Article 6243o, Vernon's | ||
Texas Civil Statutes), is amended by adding Subsection (f-2) and | ||
amending Subsection (g) to read as follows: | ||
(f-2) The board shall compute the retirement annuity of a | ||
member who retires after September 30, 2015, at the rate of 2.375 | ||
percent of the member's average total salary for each of the first | ||
20 years of service, plus five percent of the member's average total | ||
salary for each of the next seven years of service, plus 2.5 percent | ||
of the member's average total salary for the next year of service, | ||
plus 0.5 percent of the member's average total salary for each of | ||
the next five years of service, with fractional years of service | ||
prorated based on full months served as a contributing member. In | ||
making the computation for a year, the year is considered to begin | ||
on the first day a contribution is made. A retirement annuity under | ||
this subsection may not exceed, as of the date of retirement, 87.5 | ||
percent of the member's average total salary. | ||
(g) A member may not receive an award from the fund for | ||
service retirement until the member has at least 20 years of service | ||
in the fire or police department and has also contributed the | ||
required amount of money for at least 20 years. In determining the | ||
number of years of service in a department, the member shall be | ||
given full credit for the period the member was an active member | ||
plus the time the member was actively engaged in service with any | ||
uniformed service in accordance with Section 4.03 of this Act and | ||
for absences taken under the Family and Medical Leave Act of 1993 | ||
(29 U.S.C. Section 2601 et seq.), in accordance with Section 4.02 of | ||
this Act. Disciplinary suspensions of 15 days or less may not be | ||
subtracted from a member's service credit under this Act if the | ||
member has paid into the fund, within 30 days after the later of the | ||
termination date of each suspension or the exhaustion of any appeal | ||
with respect to the suspension, a sum of money equal to the amount | ||
of money that would have been deducted from that person's salary | ||
during that period of suspension if it had not been for that | ||
suspension. A municipality to which this Act applies shall pay to | ||
the fund an amount equal to the amount the municipality would have | ||
paid under Section 4.05(a) of this Act if the contributions made by | ||
the member under this section had been made by the member under | ||
Section 4.04(a) of this Act. The payment shall be made by the | ||
municipality not later than the 30th day after the date of | ||
notification by the fund that the member has made the contributions | ||
under this section [ |
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shall also receive service credit for all unused sick leave | ||
accumulated by them under Chapter 143, Local Government Code, but | ||
only to the extent the unused sick leave exceeds 90 days. Service | ||
credit for unused sick leave shall be prorated based on each full | ||
month of sick leave. A member's service credit under this section | ||
includes any service credit purchased in accordance with | ||
Subsections (k)-(m) of this section. | ||
SECTION 6. Sections 5.015(d) and (e), Chapter 824 (S.B. | ||
817), Acts of the 73rd Legislature, Regular Session, 1993 (Article | ||
6243o, Vernon's Texas Civil Statutes), are amended to read as | ||
follows: | ||
(d) The amount of a lump-sum payment to which a member | ||
making a Back DROP election is entitled shall be computed in the | ||
manner provided by this subsection and Subsection (d-1) of this | ||
section. The member's retirement annuity shall be computed in the | ||
manner provided by Section 5.01 of this Act, except that the amount | ||
of service credit and average total salary used in making that | ||
computation shall be determined in accordance with this | ||
subsection. For purposes of this subsection, the member's average | ||
total salary shall be computed based on the member's Back DROP | ||
retirement date, which is the member's actual retirement date less | ||
the amount of time the member elects under Subsection (b)(1) of this | ||
section. For purposes of this subsection, the member's service | ||
credit shall be the member's service credit determined in | ||
accordance with Section 5.01(g) of this Act less the amount of time | ||
for: | ||
(1) any service credit in excess of 33 [ |
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service, other than service credit for sick leave unused on the date | ||
of actual retirement; | ||
(2) any service credit given for sick leave unused on | ||
the date of actual retirement; and | ||
(3) any service credit in excess of 20 years but not in | ||
excess of the amount permitted under Subsection (b)(1) of this | ||
section that the member elects for computing the amount of the | ||
lump-sum payment. | ||
(e) For purposes of computing the monthly pension of a | ||
member making a Back DROP election, the member's retirement annuity | ||
shall be computed in the manner provided by Section 5.01 of this | ||
Act, except that: | ||
(1) the amount of service credit used in making that | ||
computation shall be the member's service credit determined in | ||
accordance with Section 5.01(g) of this Act less: | ||
(A) the amount of time the member elects under | ||
Subsection (b)(1) of this section; and | ||
(B) any service credit in excess of 33 [ |
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of service excluding any service credit for sick leave unused on the | ||
date of actual retirement; and | ||
(2) the member's average total salary shall be | ||
computed as if the member's retirement date were the member's actual | ||
retirement date less the amount of time the member elects under | ||
Subsection (b)(1) of this section. | ||
SECTION 7. Section 5.03(c), Chapter 824 (S.B. 817), Acts of | ||
the 73rd Legislature, Regular Session, 1993 (Article 6243o, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
(c) Except as provided by Subsection (d) of this section, a | ||
member of the fund who is on suspension and who becomes disabled as | ||
a result of an injury sustained or disease contracted while the | ||
member is on suspension is eligible for a disability retirement | ||
annuity under Subsection (a) or (a-1) of this section, as | ||
applicable, if the suspended member makes up each deducted | ||
contribution lost by reason of the suspension not later than the | ||
30th day after the later of the termination date of the suspension | ||
or the exhaustion of any appeal with respect to the suspension. A | ||
municipality to which this Act applies shall pay to the fund an | ||
amount equal to the amount the municipality would have paid under | ||
Section 4.05(a) of this Act if the contributions made by the member | ||
under this section had been made by the member under Section 4.04(a) | ||
of this Act. The payment shall be made by the municipality not | ||
later than the 30th day after the date of notification by the fund | ||
that the member has made the contributions under this section | ||
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SECTION 8. Section 5.04(a), Chapter 824 (S.B. 817), Acts of | ||
the 73rd Legislature, Regular Session, 1993 (Article 6243o, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
(a) A member who is eligible to retire and receive a | ||
disability retirement annuity under Section 5.03(a) of this Act is | ||
entitled to receive an annuity from the fund equal to: | ||
(1) 50 percent of the member's average total salary if | ||
the date of retirement is on or before September 30, 2015, or 47.5 | ||
percent of the member's average total salary if the date of | ||
retirement is after September 30, 2015, if the member has served | ||
three years or more before the date of retirement; | ||
(2) 50 percent of the member's average monthly salary | ||
as of the date of retirement multiplied by 12 if the date of | ||
retirement is on or before September 30, 2015, or 47.5 percent of | ||
the member's average monthly salary as of the date of retirement | ||
multiplied by 12 if the date of retirement is after September 30, | ||
2015, if the member has served at least two months and less than | ||
three years before the date of retirement; or | ||
(3) 50 percent of the member's average daily salary as | ||
of the date of retirement multiplied by 360 if the date of | ||
retirement is on or before September 30, 2015, or 47.5 percent of | ||
the member's average daily salary as of the date of retirement if | ||
the date of retirement is after September 30, 2015, if the member | ||
has served less than two months before the date of retirement. | ||
SECTION 9. Section 5.05(c), Chapter 824 (S.B. 817), Acts of | ||
the 73rd Legislature, Regular Session, 1993 (Article 6243o, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
(c) For those retired because of disability on or after | ||
August 30, 1971, the disability retirement annuity may not be | ||
reduced to an amount that is less than the product of: | ||
(1) 2.375 [ |
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years that the retiree served in the department and contributed a | ||
portion of salary as a member of the fund multiplied by the | ||
retiree's average total salary, if the retiree served three years | ||
or more before the date of retirement; | ||
(2) 2.375 [ |
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years that the retiree served in the department and contributed a | ||
portion of salary as a member of the fund multiplied by the | ||
retiree's average monthly salary as of the date of retirement | ||
multiplied by 12, if the retiree served at least two months and less | ||
than three years before the date of retirement; or | ||
(3) 2.375 [ |
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years that the retiree served in the department and contributed a | ||
portion of salary as a member of the fund multiplied by the | ||
retiree's average daily salary as of the date of retirement | ||
multiplied by 360, if the member has served less than two months | ||
before the date of retirement. | ||
SECTION 10. Section 5.09, Chapter 824 (S.B. 817), Acts of | ||
the 73rd Legislature, Regular Session, 1993 (Article 6243o, | ||
Vernon's Texas Civil Statutes), is amended by amending Subsection | ||
(a) and adding Subsection (a-2) to read as follows: | ||
(a) At or before its regular meeting in the month of March, | ||
the board annually shall review the Consumer's Price Index for All | ||
Urban Consumers (CPI-U), U.S. City Average or the nearest | ||
equivalent published by the United States Bureau of Labor | ||
Statistics for the preceding calendar year. If that index shows an | ||
increase during the preceding calendar year in the cost of living as | ||
compared with that index at the close of the previous year, the | ||
board shall order an increase of all service, disability, and death | ||
benefit retirement annuities by a percentage that varies by the | ||
date of the member's service or disability retirement, or, in the | ||
case of a member who died before retirement, the date on which the | ||
member died. If the member's service retirement, disability | ||
retirement, or death before retirement occurred before August 30, | ||
1971, the annuity shall be increased by a percentage equal to the | ||
percentage increase in the cost of living index. If the member's | ||
service retirement, disability retirement, or death before | ||
retirement occurred on or after August 30, 1971, but before October | ||
1, 2003 [ |
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Subsection (a-2) of this section, the annuity shall be increased as | ||
follows: if the percentage increase in the cost of living index is | ||
eight percent or less, the annuity shall be increased by a | ||
percentage equal to the percentage increase, and if the percentage | ||
increase in the cost of living index is more than eight percent, the | ||
annuity shall be increased by eight percent plus a percentage equal | ||
to 75 percent of the percentage increase that is more than eight | ||
percent. If the member's service retirement, disability | ||
retirement, or death before retirement occurred on or after October | ||
1, 2003 [ |
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Subsection (a-2) of this section, the annuity shall be increased by | ||
a percentage equal to 75 percent of the percentage increase in the | ||
cost of living index. A percentage increase in annuities shall be | ||
rounded to the nearest one-tenth percentage point for a cost of | ||
living increase. | ||
(a-2) The board may designate another date for the date | ||
October 1, 2003, in Subsection (a) of this section, provided that | ||
the designation will not cause the fund's ratio of actuarial value | ||
of assets to actuarial accrued liability to be less than 90 percent | ||
as of the date of the board's action. | ||
SECTION 11. Section 5.10, Chapter 824 (S.B. 817), Acts of | ||
the 73rd Legislature, Regular Session, 1993 (Article 6243o, | ||
Vernon's Texas Civil Statutes), is amended by amending Subsections | ||
(b), (c), (d), (f), and (j) and adding Subsection (b-1) to read as | ||
follows: | ||
(b) A distributee may elect, at the time and in the manner | ||
prescribed by the board, to have any portion of an eligible rollover | ||
distribution paid directly to an eligible retirement plan specified | ||
by the distributee in a direct rollover. [ |
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(b-1) For purposes of Subsection (b) of this section: | ||
(1) "Eligible retirement plan" means an individual | ||
retirement account described by Section 408(a) of the code, an | ||
individual retirement annuity described by Section 408(b) of the | ||
code, an annuity plan described by Section 403(a) of the code, a | ||
qualified trust described by Section 401(a) of the code, an | ||
eligible deferred compensation plan described by Section 457(b) of | ||
the code that is maintained by an eligible employer described by | ||
Section 457(e)(1)(A) of the code, or an annuity contract described | ||
by Section 403(b) of the code that accepts the distributee's | ||
eligible rollover distribution. However, in the case of an | ||
eligible rollover distribution to a designated beneficiary who is | ||
not the surviving spouse, or the spouse or former spouse under a | ||
qualified domestic relations order, an eligible retirement plan is | ||
an individual retirement account or individual retirement annuity | ||
only. | ||
(2) "Eligible rollover distribution" means a | ||
distribution of all or any portion of the balance to the credit of | ||
the distributee. The term does not include: | ||
(A) a distribution that is one of a series of | ||
substantially equal periodic payments, paid not less frequently | ||
than once a year, made over the life, or life expectancy, of the | ||
distributee or the joint lives, or joint life expectancies, of the | ||
distributee and the distributee's designated beneficiary; | ||
(B) a series of payments for a specified period | ||
of 10 years or more; | ||
(C) a distribution to the extent such | ||
distribution is required under Section 401(a)(9) of the code; or | ||
(D) the portion of a distribution that is not | ||
includable in gross income, unless the distributee directs that the | ||
eligible rollover distribution be transferred directly to a | ||
qualified trust that is part of a defined contribution plan that | ||
agrees to separately account for the portion that is includable in | ||
gross income and the portion that is not, or to an individual | ||
retirement account or individual annuity. | ||
(3) "Direct rollover" means a payment by the | ||
retirement system to the eligible retirement plan specified by a | ||
distributee. | ||
(4) "Distributee" means a member or former member. | ||
The term includes a member's or former member's surviving spouse or | ||
designated beneficiary and a member's or former member's spouse or | ||
former spouse who is the alternate payee under a qualified domestic | ||
relations order, as defined by Section 414(p) of the code, with | ||
regard to the interest of the spouse or former spouse. | ||
(c) The total salary taken into account for any purpose | ||
under this Act [ |
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annual compensation limitations under Section 401(a)(17) of the | ||
code, which are $360,000 [ |
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member [ |
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member is any employee who first became a member in a year | ||
commencing before 1996 and an ineligible member is any other | ||
member. The [ |
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annually for cost-of-living increases as provided by Section | ||
401(a)(17) of the code [ |
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(d) Accrued benefits under this Act become 100 percent | ||
vested for a member on the earlier of: | ||
(1) the date the member has completed 20 years of | ||
service; | ||
(2) the earlier termination or partial termination of | ||
the pension plan created by this Act, if it affects the member; [ |
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(3) the complete discontinuance of contributions by | ||
the municipality to the fund; or | ||
(4) the date the member attains normal retirement age. | ||
(f) Distribution of benefits must begin not later than April | ||
1 of the year following the later of the calendar year in [ |
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which the member becomes 70-1/2 years of age, or the calendar year | ||
in which the employee retires, and must otherwise conform to | ||
Section 401(a)(9) of the code and the regulations under that | ||
section of the code, including the incidental benefit rule. | ||
(j) Notwithstanding any other provision of this Act, the | ||
limit on maximum benefits imposed by Section 415 of the code and | ||
Subsection (a) of this section shall be adjusted each year to the | ||
extent permitted by cost-of-living increases announced by the | ||
secretary of the treasury under Section 415(d) of the code and | ||
applicable law. Any such benefit increases shall apply to members | ||
who have terminated employment, including members who have begun | ||
receiving benefits before the effective date of the change, and any | ||
benefits previously denied. Benefits paid to make up for benefits | ||
previously denied are not considered to be extra compensation | ||
earned after retirement, but shall be considered the delayed | ||
payment of benefits earned before retirement. [ |
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SECTION 12. Sections 6.02(a) and (g), Chapter 824 (S.B. | ||
817), Acts of the 73rd Legislature, Regular Session, 1993 (Article | ||
6243o, Vernon's Texas Civil Statutes), are amended to read as | ||
follows: | ||
(a) Subject to Section 6.03 of this Act and the provisions | ||
of this section, if a member or retiree receiving a disability | ||
pension under Section 5.04(a) [ |
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surviving spouse or at least one dependent child, the surviving | ||
spouse and the children are entitled to receive from the fund an | ||
aggregate death benefit annuity, computed and payable from the date | ||
of the member's death. The surviving spouse may elect the annuity | ||
in an amount that is equal to [ |
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(1) 50 percent of the member's average total salary, if | ||
the surviving spouse is the surviving spouse of a disability | ||
retiree who was awarded a disability pension before October 1, | ||
2015; [ |
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(2) 47.5 percent of the member's average total salary; | ||
or | ||
(3) the same percentage of the member's average total | ||
salary that the member would have been entitled to receive as a | ||
retirement annuity if the member could have retired on the date of | ||
death. | ||
(g) A child who is adopted after the date of retirement of | ||
the member is not entitled to a death benefit under this Act. A | ||
child who is born after the date of retirement of the member is not | ||
entitled to a death benefit annuity under this Act unless the | ||
retiree was married to the other parent of the child on the date of | ||
retirement. A surviving spouse of a retiree whose status as a | ||
surviving spouse resulted from a marriage after the date of the | ||
retirement of the retiree is entitled to receive only the benefits, | ||
if any, provided under Subsection (g-1) of this section or Section | ||
6.08 of this Act. | ||
SECTION 13. Section 6.06, Chapter 824 (S.B. 817), Acts of | ||
the 73rd Legislature, Regular Session, 1993 (Article 6243o, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
Sec. 6.06. COMMON-LAW MARRIAGES. Common-law marriages are | ||
not recognized under this Act and benefits may not be conferred on | ||
common-law spouses as beneficiaries unless a declaration of | ||
informal marriage was made and recorded under Sections 2.402 and | ||
2.404, Family Code, [ |
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successor statutes, before the member's death. The date the | ||
declaration of informal marriage is recorded is the date of | ||
marriage for the purpose of determining whether any benefit is to be | ||
awarded to a surviving common-law spouse as a beneficiary. | ||
SECTION 14. This Act takes effect October 1, 2015. |