Bill Text: TX HB4238 | 2017-2018 | 85th Legislature | Introduced
Bill Title: Relating to the public retirement systems of certain municipalities.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2017-04-03 - Referred to Pensions [HB4238 Detail]
Download: Texas-2017-HB4238-Introduced.html
85R2508 KFF-D | ||
By: Flynn | H.B. No. 4238 |
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relating to the public retirement systems of certain | ||
municipalities. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
ARTICLE 1. FIREFIGHTERS' RELIEF AND RETIREMENT FUND | ||
SECTION 1.01. Section 3(d), Article 6243e.2(1), Revised | ||
Statutes, is amended to read as follows: | ||
(d) The board may have an actuarial valuation performed each | ||
year, and for determining the municipality's contribution rate as | ||
provided by Section 13(d) of this article, the board may adopt a new | ||
actuarial valuation every three years [ |
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SECTION 1.02. Article 6243e.2(1), Revised Statutes, is | ||
amended by adding Section 3A to read as follows: | ||
Sec. 3A. ACTION INCREASING AMORTIZATION PERIOD. (a) | ||
Notwithstanding any other provision of this article, a rate of a | ||
member's or a municipality's contributions to or a rate of interest | ||
or the amount of a fee required for the establishment of credit in | ||
the fund may not be reduced or eliminated, a type of service may not | ||
be made creditable in the fund, a limit on the maximum permissible | ||
amount of a type of creditable service may not be removed or raised, | ||
a new monetary benefit payable by the fund may not be established, | ||
and the determination of the amount of a monetary benefit from the | ||
fund may not be increased, if, as a result of the particular action, | ||
the time, as determined by an actuarial valuation, required to | ||
amortize the unfunded actuarial liabilities of the fund would be | ||
increased to a period that exceeds 30 years. | ||
(b) If the amortization period for the unfunded actuarial | ||
liabilities of the fund exceeds 30 years at the time an action | ||
described by Subsection (a) of this section is proposed, the | ||
proposal may not be adopted if, as a result of the adoption, the | ||
amortization period would be increased, as determined by an | ||
actuarial valuation. | ||
SECTION 1.03. Section 5, Article 6243e.2(1), Revised | ||
Statutes, is amended by adding Subsection (s) to read as follows: | ||
(s) The board may adopt rules, policies, or procedures that | ||
the board determines are necessary or desirable to implement or | ||
administer this section, including rules that limit the amount of a | ||
member's earnings under the DROP or that limit the length of time a | ||
member may elect to participate in the DROP. | ||
SECTION 1.04. Section 10, Article 6243e.2(1), Revised | ||
Statutes, is amended to read as follows: | ||
Sec. 10. NONSTATUTORY BENEFIT INCREASES. The benefits | ||
provided by this article may be increased if: | ||
(1) an actuary selected by the board who, if an | ||
individual, is a Fellow of the Society of Actuaries, a Fellow of the | ||
Conference of Consulting Actuaries [ |
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member of the American Academy of Actuaries determines that the | ||
increase complies with Section 3A of this article [ |
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(2) a majority of the participating members of the | ||
fund vote for the increase by a secret ballot; | ||
(3) the increase does not deprive a member, without | ||
the member's written consent, of a right to receive benefits that | ||
have already become fully vested and matured in a member; and | ||
(4) the State Pension Review Board approves the | ||
determination by the actuary selected by the board that the | ||
increase complies with Section 3A of this article [ |
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SECTION 1.05. Section 13(d), Article 6243e.2(1), Revised | ||
Statutes, is amended to read as follows: | ||
(d) The municipality shall make contributions to the fund | ||
once every two weeks in an amount equal to the product of the | ||
contribution rate certified by the board and the aggregate salaries | ||
paid to members of the fund during the period for which the | ||
contribution is made. The board shall certify the municipality's | ||
contribution rate for each year or portion of a year based on the | ||
results of actuarial valuations made at least every three | ||
years. The municipality's contribution rate shall be composed of | ||
the normal cost plus the level percentage of salary payment | ||
required to amortize the unfunded actuarial liability over a | ||
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this article, the contributions by the municipality, when added to | ||
any contributions with respect to a qualified governmental excess | ||
benefit arrangement maintained in accordance with Section 14(c) of | ||
this article, may not be less than twice the amount paid into the | ||
fund by contributions of the members. | ||
ARTICLE 2. POLICE OFFICERS' PENSION SYSTEM | ||
SECTION 2.01. Article 6243g-4, Revised Statutes, is amended | ||
by adding Section 6A to read as follows: | ||
Sec. 6A. ACTION INCREASING AMORTIZATION PERIOD. (a) | ||
Notwithstanding any other provision of this article, a rate of a | ||
member's or a city's contributions to or a rate of interest or the | ||
amount of a fee required for the establishment of credit in the | ||
pension system may not be reduced or eliminated, a type of service | ||
may not be made creditable in the pension system, a limit on the | ||
maximum permissible amount of a type of creditable service may not | ||
be removed or raised, a new monetary benefit payable by the pension | ||
system may not be established, and the determination of the amount | ||
of a monetary benefit from the pension system may not be increased, | ||
if, as a result of the particular action, the time, as determined by | ||
an actuarial valuation, required to amortize the unfunded actuarial | ||
liabilities of the pension system would be increased to a period | ||
that exceeds 30 years. | ||
(b) If the amortization period for the unfunded actuarial | ||
liabilities of the pension system exceeds 30 years at the time an | ||
action described by Subsection (a) of this section is proposed, the | ||
proposal may not be adopted if, as a result of the adoption, the | ||
amortization period would be increased, as determined by an | ||
actuarial valuation. | ||
SECTION 2.02. Section 9(a), Article 6243g-4, Revised | ||
Statutes, is amended to read as follows: | ||
(a) The city shall make [ |
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to the fund [ |
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payroll period in an amount equal to the product of the contribution | ||
rate certified by the board and the aggregate salaries paid to | ||
members of the pension system during the period for which the | ||
contribution is made. The board shall certify the city's | ||
contribution rate for each year or portion of a year based on the | ||
results of actuarial valuations made at least every three years. | ||
For each fiscal year ending after June 30, 2005, the city's minimum | ||
contribution shall be the normal cost plus the [ |
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salary payment required to amortize the unfunded actuarial | ||
liability over a [ |
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years [ |
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SECTION 2.03. Sections 12(c) and (e), Article 6243g-4, | ||
Revised Statutes, are amended to read as follows: | ||
(c) Except as provided by Section 6A of this article, the | ||
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shall be adjusted annually, effective April 1 of each year, upward | ||
at a rate determined by board rule [ |
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(e) Subject to Section 6A of this article, at [ |
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each calendar year beginning after 1998, and subject to the | ||
conditions provided by this subsection, the pension system shall | ||
make a 13th benefit payment to each person who is receiving a | ||
service pension. The amount of the 13th payment shall be the same | ||
as the last monthly payment received by the retiree or survivor | ||
before issuance of the payment, except the payment received by any | ||
person who has been in pay status for less than 12 months shall be | ||
for a prorated amount determined by dividing the amount of the last | ||
payment received by 12 and multiplying this amount by the number of | ||
months the person has been in pay status. [ |
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SECTION 2.04. Section 14, Article 6243g-4, Revised | ||
Statutes, is amended by adding Subsection (n) to read as follows: | ||
(n) The board may adopt rules, policies, or procedures that | ||
the board determines are necessary or desirable to implement or | ||
administer this section, including rules that limit the amount of a | ||
member's earnings under the DROP or that limit the length of time a | ||
member may elect to participate in the DROP. | ||
ARTICLE 3. MUNICIPAL EMPLOYEES PENSION SYSTEM | ||
SECTION 3.01. Chapter 88 (H.B. 1573), Acts of the 77th | ||
Legislature, Regular Session, 2001 (Article 6243h, Vernon's Texas | ||
Civil Statutes), is amended by adding Section 3A to read as follows: | ||
Sec. 3A. ACTION INCREASING AMORTIZATION PERIOD. (a) | ||
Notwithstanding any other provision of this Act, a rate of a | ||
member's or a city's contributions to or a rate of interest or the | ||
amount of a fee required for the establishment of credit in the | ||
pension system may not be reduced or eliminated, a type of service | ||
may not be made creditable in the pension system, a limit on the | ||
maximum permissible amount of a type of creditable service may not | ||
be removed or raised, a new monetary benefit payable by the pension | ||
system may not be established, and the determination of the amount | ||
of a monetary benefit from the pension system may not be increased, | ||
if, as a result of the particular action, the time, as determined by | ||
an actuarial valuation, required to amortize the unfunded actuarial | ||
liabilities of the pension fund would be increased to a period that | ||
exceeds 30 years. | ||
(b) If the amortization period for the unfunded actuarial | ||
liabilities of the pension system exceeds 30 years at the time an | ||
action described by Subsection (a) of this section is proposed, the | ||
proposal may not be adopted if, as a result of the adoption, the | ||
amortization period would be increased, as determined by an | ||
actuarial valuation. | ||
SECTION 3.02. Section 8(d), Chapter 88 (H.B. 1573), Acts of | ||
the 77th Legislature, Regular Session, 2001 (Article 6243h, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
(d) The city shall make [ |
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fund each payroll period in an amount equal to the product of the | ||
contribution rate certified by the pension board and the aggregate | ||
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of all group A and group B members of the pension fund. The | ||
contribution rate, expressed as a percentage, shall be based on the | ||
results of actuarial valuations made at least every three years. | ||
The city's contribution rate shall consist of the normal cost plus | ||
the level percentage of salary payments required to amortize the | ||
unfunded actuarial liability over a period that does not exceed 30 | ||
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Notwithstanding any other provision of this Act, the city's | ||
contribution rate, when added to any contributions with respect to | ||
a qualified governmental excess benefit arrangement maintained in | ||
accordance with Section 24 of this Act, may not be an amount less | ||
than the greater of 10 percent of the combined salaries of all | ||
members or two times the contribution rate of group A members as | ||
provided in Subsection (a) of this section. | ||
SECTION 3.03. Section 10(h), Chapter 88 (H.B. 1573), Acts | ||
of the 77th Legislature, Regular Session, 2001 (Article 6243h, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
(h) Subject to Section 3A of this Act, for [ |
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payments only, pension and survivor benefits for all retirees and | ||
eligible survivors shall be increased annually by four percent, not | ||
compounded, for all persons receiving a pension or survivor benefit | ||
as of January 1 of the year in which the increase is made. | ||
SECTION 3.04. Section 12(q), Chapter 88 (H.B. 1573), Acts | ||
of the 77th Legislature, Regular Session, 2001 (Article 6243h, | ||
Vernon's Texas Civil Statutes), is amended to read as follows: | ||
(q) The pension board may adopt rules for the implementation | ||
and operation of the DROP, including rules: | ||
(1) regarding the payment of DROP benefits; and | ||
(2) that limit the amount of a member's earnings under | ||
the DROP or that limit the length of time a member may elect to | ||
participate in the DROP. | ||
SECTION 3.05. Sections 15(a), (b), and (d), Chapter 88 | ||
(H.B. 1573), Acts of the 77th Legislature, Regular Session, 2001 | ||
(Article 6243h, Vernon's Texas Civil Statutes), are amended to read | ||
as follows: | ||
(a) In addition to the postretirement increases under | ||
Section 10(h) of this Act and subject to Section 3A of this Act, the | ||
pension board may increase annuities payable under this Act by an | ||
amount that does not exceed the annual increase in the amount of | ||
premiums being paid under a group insurance program provided for | ||
retirees of the city. | ||
(b) The pension board may distribute a supplemental payment | ||
to all retirees and eligible survivors who are receiving annuities | ||
as of January 1 of the year in which the supplemental payment is | ||
made. The supplemental payment shall be credited to the DROP | ||
participants who are participating in the DROP as of January 1 of | ||
the year in which the supplemental payment is made, if the pension | ||
board's actuary determines that the payment complies with Section | ||
3A of this Act [ |
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(d) A pension benefit or allowance provided by this article | ||
may be increased if: | ||
(1) a qualified actuary selected by the pension board | ||
determines that the increase complies with Section 3A of this | ||
article [ |
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(2) the increase is approved by the pension board and | ||
the city in a written agreement as provided by Section 3(n) of this | ||
article; and | ||
(3) the increase does not deprive a member or retiree, | ||
without the written consent of the member or retiree, from | ||
receiving the immediate or deferred retirement benefit that the | ||
member or retiree was eligible to receive under this article before | ||
the increase. | ||
ARTICLE 4. EFFECTIVE DATE | ||
SECTION 4.01. This Act takes effect September 1, 2017. |