Bill Text: TX HB4075 | 2017-2018 | 85th Legislature | Introduced


Bill Title: Relating to contributions to, benefits from, membership in, and the administration of systems and programs administered by the Teacher Retirement System of Texas.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2017-05-01 - Left pending in committee [HB4075 Detail]

Download: Texas-2017-HB4075-Introduced.html
  85R9176 TSR-F
 
  By: Flynn H.B. No. 4075
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to contributions to, benefits from, membership in, and the
  administration of systems and programs administered by the Teacher
  Retirement System of Texas.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Sections 22.004(b) and (d), Education Code, are
  amended to read as follows:
         (b)  A district that does not participate in the program
  described by Subsection (a) shall make available to its employees
  group health coverage provided by a risk pool established by one or
  more school districts under Chapter 172, Local Government Code, or
  under a policy of insurance or group contract issued by an insurer,
  a company subject to Chapter 842, Insurance Code, or a health
  maintenance organization under Chapter 843, Insurance Code.  The
  coverage must meet the substantive coverage requirements of Chapter
  1251, Subchapter A, Chapter 1364, and Subchapter A, Chapter 1366,
  Insurance Code, and any other law applicable to group health
  insurance policies or contracts issued in this state.  The coverage
  must include major medical treatment but may exclude experimental
  procedures.  In this subsection, "major medical treatment" means a
  medical, surgical, or diagnostic procedure for illness or
  injury.  The coverage may include managed care or preventive care
  and must be comparable to the basic health coverage provided under
  Chapter 1551, Insurance Code.  The [board of trustees of the Teacher
  Retirement System of Texas shall adopt rules to determine whether a
  school district's group health coverage is comparable to the basic
  health coverage specified by this subsection. The rules must
  provide for consideration of the] following factors shall be
  considered [concerning the district's coverage] in determining
  whether the district's coverage is comparable to the basic health
  coverage specified by this subsection:
               (1)  the deductible amount for service provided inside
  and outside of the network;
               (2)  the coinsurance percentages for service provided
  inside and outside of the network;
               (3)  the maximum amount of coinsurance payments a
  covered person is required to pay;
               (4)  the amount of the copayment for an office visit;
               (5)  the schedule of benefits and the scope of
  coverage;
               (6)  the lifetime maximum benefit amount; and
               (7)  verification that the coverage is issued by a
  provider licensed to do business in this state by the Texas
  Department of Insurance or is provided by a risk pool authorized
  under Chapter 172, Local Government Code, or that a district is
  capable of covering the assumed liabilities in the case of coverage
  provided through district self-insurance.
         (d)  Each district [shall report the district's compliance
  with this section to the executive director of the Teacher
  Retirement System of Texas not later than March 1 of each
  even-numbered year in the manner required by the board of trustees
  of the Teacher Retirement System of Texas.   For a district] that
  does not participate in the program described by Subsection (a)
  shall prepare a report addressing the district's compliance with
  this section.  The[, the] report must be available for review,
  together with the policy or contract for the group health coverage
  plan, at the central administrative office of each campus in the
  district and be posted on the district's Internet website if the
  district maintains a website, must be based on the district group
  health coverage plan in effect during the current plan year, and
  must include:
               (1)  appropriate documentation of:
                     (A)  the district's contract for group health
  coverage with a provider licensed to do business in this state by
  the Texas Department of Insurance or a risk pool authorized under
  Chapter 172, Local Government Code; or
                     (B)  a resolution of the board of trustees of the
  district authorizing a self-insurance plan for district employees
  and of the district's review of district ability to cover the
  liability assumed;
               (2)  the schedule of benefits;
               (3)  the premium rate sheet, including the amount paid
  by the district and employee;
               (4)  the number of employees covered by the health
  coverage plan offered by the district; and
               (5)  information concerning the ease of completing the
  report[, as required by the executive director of the Teacher
  Retirement System of Texas; and
               [(6)     any other information considered appropriate by
  the executive director of the Teacher Retirement System of Texas].
         SECTION 2.  Subchapter A, Chapter 821, Government Code, is
  amended by adding Section 821.0011 to read as follows:
         Sec. 821.0011.  DETERMINATION OF EMPLOYEE OR INDEPENDENT
  CONTRACTOR STATUS. In determining whether an individual is an
  employee or independent contractor of an employer, the retirement
  system shall use the test applied under common law and any guidance
  issued by the Internal Revenue Service regarding factors to
  consider when determining an individual's employment status.
         SECTION 3.  Section 822.201(b), Government Code, is amended
  to read as follows:
         (b)  "Salary and wages" as used in Subsection (a) means:
               (1)  normal periodic payments of money for service the
  right to which accrues on a regular basis in proportion to the
  service performed;
               (2)  amounts by which the member's salary is reduced
  under a salary reduction agreement authorized by Chapter 610;
               (3)  amounts that would otherwise qualify as salary and
  wages under Subdivision (1) but are not received directly by the
  member pursuant to a good faith, voluntary written salary reduction
  agreement in order to finance payments to a deferred compensation
  or tax sheltered annuity program specifically authorized by state
  law or to finance benefit options under a cafeteria plan qualifying
  under Section 125 of the Internal Revenue Code of 1986, if:
                     (A)  the program or benefit options are made
  available to all employees of the employer; and
                     (B)  the benefit options in the cafeteria plan are
  limited to one or more options that provide deferred compensation,
  group health and disability insurance, group term life insurance,
  dependent care assistance programs, or group legal services plans;
               (4)  performance pay awarded to an employee by a school
  district as part of a total compensation plan approved by the board
  of trustees of the district and meeting the requirements of
  Subsection (e);
               (5)  the benefit replacement pay a person earns under
  Subchapter H, Chapter 659, except as provided by Subsection (c);
               (6)  stipends paid to teachers in accordance with
  Section 21.410, 21.411, 21.412, or 21.413, Education Code;
               (7)  amounts by which the member's salary is reduced or
  that are deducted from the member's salary as authorized by
  Subchapter J, Chapter 659;
               (8)  a merit salary increase made under Section 51.962,
  Education Code;
               (9)  amounts received under the relevant parts of the
  educator excellence awards program under Subchapter O, Chapter 21,
  Education Code, or a mentoring program under Section 21.458,
  Education Code, that authorize compensation for service;
               (10)  salary amounts designated as health care
  supplementation by an employee under Subchapter D, Chapter 22,
  Education Code; and
               (11)  to the extent required by Sections 3401(h) and
  414(u)(12) [414(u)(2)], Internal Revenue Code of 1986,
  differential wage payments received by an individual from an
  employer on or after January 1, 2009, while the individual is
  performing qualified military service as defined by Section 414(u),
  Internal Revenue Code of 1986.
         SECTION 4.  Section 823.004(a), Government Code, is amended
  to read as follows:
         (a)  All credit for military service, out-of-state service,
  developmental leave, work experience in a career or technological
  field, and service transferred to the retirement system under
  Chapter 805 shall be computed on a September 1 through August 31
  school year. Payments for service described by this section must be
  completed:
               (1)  not later than two calendar months after the later
  of the member's retirement date or the last day of the month in
  which the member submits a retirement application; and
               (2)  before the later of the due date for the member's
  first monthly annuity payment or the date on which the retirement
  system issues the first monthly annuity payment to the member.
         SECTION 5.  Section 823.403, Government Code, is amended by
  amending Subsections (c) and (d) and adding Subsection (d-1) to
  read as follows:
         (c)  On receipt of a certification under Subsection (b) and
  payment under Subsection (d) of this section, the retirement system
  shall grant any credit to which a retiree who is a subject of the
  certification is entitled. An annuity payment may not be increased
  until the retirement system is paid the full cost of the service
  credit.  [The increase in the annuity payment begins with the first
  payment that becomes due after certification and payment.]
         (d)  In order to receive credit, the member shall pay to the
  retirement system at the time service credit is granted under this
  section the actuarial present value of the additional standard
  retirement annuity benefits under the option selected by the member
  that would be attributable to the conversion of the unused state
  personal or sick leave into the service credit based on rates and
  tables recommended by the actuary and adopted by the board of
  trustees. Except as provided by this subsection, the retirement
  system must receive the payment for service credit under this
  section not later than the 90th day after the date the retirement
  system issues a cost statement for the purchase of service credit
  under this section.  The retirement system may grant a member a
  one-time extension of not more than 30 days to complete the purchase
  of the service credit if the purchase is made by:
               (1)  a direct rollover distribution from another
  eligible retirement plan; or
               (2)  a direct trustee-to-trustee transfer from:
                     (A)  an eligible deferred compensation plan
  described by Section 457(b), Internal Revenue Code of 1986; or 
                     (B)  an individual account plan consisting of an
  annuity contract described by Section 403(b), Internal Revenue Code
  of 1986.
         (d-1)  A member who fails to make the payment described by
  Subsection (d) within the time prescribed by that subsection may:
               (1)  decline to purchase service credit under this
  section and maintain the member's effective date of retirement; or
               (2)  revoke the member's retirement as provided by
  Section 824.005(a) and select a later retirement date that provides
  the member with sufficient time to complete the purchase of the
  service credit under this section.
         SECTION 6.  Sections 824.002(e) and (f), Government Code,
  are amended to read as follows:
         (e)  Except as provided by Section 823.403(d), if
  applicable, not [Not] later than two months after the later of a
  member's retirement date or the last day of the month in which the
  member's application for retirement is submitted, and before the
  later of the due date for the first monthly annuity payment or the
  date on which the retirement system issues the first monthly
  annuity payment, a member applying for service retirement may,
  after providing notice to the retirement system, reinstate
  withdrawn contributions, make deposits for military service and
  equivalent membership service, and receive service credit as
  provided by this subtitle.
         (f)  An effective retirement date may not be changed after it
  is established except by revocation of retirement under Section
  824.005 [and retirement at a later date].
         SECTION 7.  Section 825.307(a), Government Code, is amended
  to read as follows:
         (a)  The retirement system shall deposit in a member's
  individual account in the member savings account:
               (1)  the amount of contributions to the retirement
  system that is deducted from the member's compensation;
               (2)  the portion of a deposit made on or after
  resumption of membership that represents the amount of retirement
  benefits received;
               (3)  the portion of a deposit to reinstate service
  credit previously canceled that represents the amount withdrawn or
  refunded;
               (4)  the portion of a deposit to establish military
  service credit required by Section 823.302(c);
               (5)  the portion of a deposit to establish USERRA
  credit required by Section 823.304(c);
               (6)  the portion of a deposit to establish:
                     (A)  equivalent membership service credit
  required by Section 823.401(d), 823.402(e) [823.402(e)(1) or
  (e)(2)], 823.403(d), [or] 823.404(c), or 823.406(b) or former
  Section 823.405; or
                     (B)  unreported service credit or compensation
  required by Section 825.403(h); and
               (7) [(6)]  interest earned on money in the account as
  provided by Subsections (b) and (c) and Section 825.313(c).
         SECTION 8.  Section 825.509(b-1), Government Code, is
  amended to read as follows:
         (b-1)  Notwithstanding Subsection (b)(3), with respect to a
  distribution made on or after January 1, 2002, an otherwise
  eligible portion of a rollover distribution that consists of
  after-tax employee contributions not includable in gross income is
  an eligible rollover distribution for purposes of this section. The
  eligible portion may be transferred only:
               (1)  to an individual retirement account or annuity
  described by Section 408(a) or (b), Internal Revenue Code of 1986;
               (2)  to a qualified plan described by Section 403(a),
  Internal Revenue Code of 1986;
               (3)  for distributions occurring on or after January 1,
  2007, to a qualified plan described by Section 401(a), Internal
  Revenue Code of 1986, if the plan separately accounts for:
                     (A)  the amounts transferred and the earnings on
  the amounts transferred; and
                     (B)  the portion of the distribution that is
  includable in gross income and the portion of the distribution that
  is not includable in gross income; or
               (4)  to an annuity contract described by Section
  403(b), Internal Revenue Code of 1986, that agrees to separately
  account for amounts transferred and earnings on amounts
  transferred, including for the portion of the distribution that is
  includable in gross income and the portion of the distribution that
  is not includable in gross income.
         SECTION 9.  Section 830.201(h), Government Code, is amended
  to read as follows:
         (h)  Before November 2 of each even-numbered year, the Texas
  Higher Education Coordinating Board [board of trustees], in
  coordination with the Legislative Budget Board, shall certify to
  the comptroller for review and adoption an estimate of the amount
  necessary to pay the state's contributions to the retirement system
  for the following biennium.  For qualifying employees under
  Subsection (g)(1), the Texas Higher Education Coordinating Board
  [board of trustees] shall include only the amount payable by the
  state under Subsection (g)(1) in determining the amount to be
  certified.
         SECTION 10.  This Act takes effect September 1, 2017.
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