Bill Text: TX SB12 | 2019-2020 | 86th Legislature | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to the contributions to and benefits under the Teacher Retirement System of Texas.
Spectrum: Bipartisan Bill
Status: (Passed) 2019-06-10 - Effective immediately [SB12 Detail]
Download: Texas-2019-SB12-Introduced.html
Bill Title: Relating to the contributions to and benefits under the Teacher Retirement System of Texas.
Spectrum: Bipartisan Bill
Status: (Passed) 2019-06-10 - Effective immediately [SB12 Detail]
Download: Texas-2019-SB12-Introduced.html
2019S0324-1 03/04/19 | ||
By: Huffman, et al. | S.B. No. 12 |
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relating to the contributions to the Teacher Retirement System of | ||
Texas. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 825.402, Government Code, is amended to | ||
read as follows: | ||
Sec. 825.402. RATE OF MEMBER CONTRIBUTIONS. The rate of | ||
contributions for each member of the retirement system is: | ||
(1) five percent of the member's annual compensation | ||
or $180, whichever is less, for service rendered after August 31, | ||
1937, and before September 1, 1957; | ||
(2) six percent of the first $8,400 of the member's | ||
annual compensation for service rendered after August 31, 1957, and | ||
before September 1, 1969; | ||
(3) six percent of the member's annual compensation | ||
for service rendered after August 31, 1969, and before the first day | ||
of the 1977-78 school year; | ||
(4) 6.65 percent of the member's annual compensation | ||
for service rendered after the last day of the period described by | ||
Subdivision (3) and before September 1, 1985; | ||
(5) 6.4 percent of the member's annual compensation | ||
for service rendered after August 31, 1985, and before September 1, | ||
2014; | ||
(6) 6.7 percent of the member's annual compensation | ||
for service rendered after August 31, 2014, and before September 1, | ||
2015; | ||
(7) 7.2 percent of the member's annual compensation | ||
for service rendered after August 31, 2015, and before September 1, | ||
2016; | ||
(8) 7.7 percent of the member's annual compensation | ||
for service rendered after August 31, 2016, and before September 1, | ||
2017; [ |
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(9) for compensation paid [ |
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after September 1, 2017, and before September 1, 2019, the lesser | ||
of: | ||
(A) 7.7 percent of the member's annual | ||
compensation; or | ||
(B) a percentage of the member's annual | ||
compensation equal to 7.7 percent reduced by one-tenth of one | ||
percent for each one-tenth of one percent that the state | ||
contribution rate for the fiscal year to which the compensation | ||
[ |
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established for the 2015 fiscal year; | ||
(10) for compensation paid on or after September 1, | ||
2019, and before September 1, 2021, the lesser of: | ||
(A) 7.7 percent of the member's annual | ||
compensation; or | ||
(B) a percentage of the member's annual | ||
compensation equal to 7.7 percent reduced by one-tenth of one | ||
percent for each one-tenth of one percent that the state | ||
contribution rate for the fiscal year to which the compensation | ||
relates is less than the state contribution rate established by | ||
Section 825.404(f) for that fiscal year; | ||
(11) for compensation paid on or after September 1, | ||
2021, but before September 1, 2023, the lesser of: | ||
(A) eight percent of the member's annual | ||
compensation; or | ||
(B) a percentage of the member's annual | ||
compensation equal to eight percent reduced by one-tenth of one | ||
percent for each one-tenth of one percent that the state | ||
contribution rate for the fiscal year to which the compensation | ||
relates is less than the state contribution rate established by | ||
Section 825.404(f) for that fiscal year; and | ||
(12) for compensation paid on or after September 1, | ||
2023, the lesser of: | ||
(A) 8.25 percent of the member's annual | ||
compensation; or | ||
(B) a percentage of the member's annual | ||
compensation equal to 8.25 percent reduced by one-tenth of one | ||
percent for each one-tenth of one percent that the state | ||
contribution rate for the fiscal year to which the service relates | ||
is less than the state contribution rate established by Section | ||
825.404(f) for that fiscal year. | ||
SECTION 2. Section 825.4035, Government Code, is amended by | ||
amending Subsections (b) and (c) and adding Subsection (e) to read | ||
as follows: | ||
(b) Except as provided in Subsection (c), for each member | ||
the employer reports to the retirement system and for whom the | ||
employer is not making contributions to the federal Old-Age, | ||
Survivors, and Disability Insurance program, the employer shall | ||
contribute monthly to the retirement system for each such member: | ||
(1) for the period beginning with the report month of | ||
September 2014 and ending with the report month of August 2015, an | ||
amount equal to 1.5 percent of the member's compensation; [ |
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(2) beginning with the report month for September 2015 | ||
and ending with the report month August 2019, an amount equal to the | ||
lesser of: | ||
(A) 1.5 percent of the member's compensation; or | ||
(B) a percentage of the member's compensation | ||
equal to 1.5 percent reduced by one-tenth of one percent for each | ||
one-tenth of one percent that the state contribution rate for the | ||
fiscal year to which the report month relates is less than the state | ||
contribution rate established for the 2015 fiscal year; | ||
(3) beginning with the report month for September 2019 | ||
and ending with the report month August 2020, an amount equal to the | ||
lesser of: | ||
(A) 1.5 percent of the member's compensation; or | ||
(B) a percentage of the member's compensation | ||
equal to 1.5 percent reduced by one-tenth of one percent for each | ||
one-tenth of one percent that the state contribution rate for the | ||
fiscal year to which the report month relates is less than the state | ||
contribution rate established for that fiscal year under Section | ||
825.404(f); and | ||
(4) beginning with the report month for September | ||
2020, an amount equal to the lesser of: | ||
(A) a percentage of the member's compensation | ||
equal to the rate of contribution provided for the applicable | ||
fiscal year under Subsection (e); or | ||
(B) a percentage of the member's compensation | ||
equal to the percentage provided by Paragraph (A) reduced by | ||
one-tenth of one percent for each one-tenth of one percent that the | ||
state contribution rate for the fiscal year to which the report | ||
month relates is less than the state contribution rate established | ||
for that fiscal year under Section 825.404(f). | ||
(c) If a member is entitled to the minimum salary for | ||
certain school personnel under Section 21.402, Education Code, or | ||
if a member would have been entitled to the minimum salary for | ||
certain school personnel under former Section 16.056, Education | ||
Code, as that section existed on January 1, 1995, the employer | ||
shall, in addition to any contributions required under Section | ||
825.405, contribute monthly to the retirement system for each such | ||
member: | ||
(1) for the period beginning with the report month of | ||
September 2014 and ending with the report month of August 2015, an | ||
amount equal to 1.5 percent of the statutory minimum salary | ||
determined under Section 825.405(b); [ |
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(2) beginning with the report month for September 2015 | ||
and ending with the report month of August 2019, an amount equal to | ||
the lesser of: | ||
(A) 1.5 percent of the statutory minimum salary | ||
determined under Section 825.405(b); or | ||
(B) a percentage of the statutory minimum salary | ||
determined under Section 825.405(b) equal to 1.5 percent reduced by | ||
one-tenth of one percent for each one-tenth of one percent that the | ||
state contribution rate for the fiscal year to which the report | ||
month relates is less than the state contribution rate established | ||
for the 2015 fiscal year; | ||
(3) beginning with the report month for September 2019 | ||
and ending with the report month of August 2020, an amount equal to | ||
the lesser of: | ||
(A) 1.5 percent of the statutory minimum salary | ||
determined under Section 825.405(b); or | ||
(B) a percentage of the statutory minimum salary | ||
determined under Section 825.405(b) equal to 1.5 percent reduced by | ||
one-tenth of one percent for each one-tenth of one percent that the | ||
state contribution rate for the fiscal year to which the report | ||
month relates is less than the state contribution rate established | ||
for that fiscal year under Section 825.404(f); and | ||
(4) beginning with the report month for September | ||
2020, an amount equal to the lesser of: | ||
(A) a percentage of the statutory minimum salary | ||
determined under Section 825.405(b) equal to the rate of | ||
contribution provided for the applicable fiscal year under | ||
Subsection (e); or | ||
(B) a percentage of the statutory minimum salary | ||
determined under Section 825.405(b) equal to the percentage | ||
provided by Paragraph (A) reduced by one-tenth of one percent for | ||
each one-tenth of one percent that the state contribution rate for | ||
the fiscal year to which the report month relates is less than the | ||
state contribution rate established for that fiscal year under | ||
Section 825.404(f). | ||
(e) Unless otherwise required by Subsection (b)(4)(B) or | ||
(c)(4)(B), employers shall contribute monthly to the retirement | ||
system in accordance with the requirements of this section at the | ||
following contribution rates: | ||
(1) 1.6 percent beginning with the report month for | ||
September 2020; | ||
(2) 1.7 percent beginning with the report month for | ||
September 2021; | ||
(3) 1.8 percent beginning with the report month for | ||
September 2022; | ||
(4) 1.9 percent beginning with the report month for | ||
September 2023; and | ||
(5) two percent beginning with the report month for | ||
September 2024 and for all subsequent report months. | ||
SECTION 3. Section 825.404, Government Code, is amended by | ||
amending Subsections (a) and (a-1) and adding Subsection (f) to | ||
read as follows: | ||
(a) Except as provided by Subsections [ |
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and (f), during each fiscal year, the state shall contribute to the | ||
retirement system an amount equal to at least six and not more than | ||
10 percent of the aggregate annual compensation of all members of | ||
the retirement system during that fiscal year. | ||
(a-1) In computing the amount owed by the state under this | ||
section [ |
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employed by public junior colleges or public junior college | ||
districts shall be included in the aggregate annual compensation as | ||
follows: | ||
(1) 50 percent of the eligible creditable compensation | ||
of employees who: | ||
(A) otherwise are eligible for membership in the | ||
retirement system; and | ||
(B) are instructional or administrative | ||
employees whose salaries may be fully paid from funds appropriated | ||
under the General Appropriations Act, regardless of whether such | ||
salaries are actually paid from appropriated funds; and | ||
(2) none of the eligible creditable compensation of | ||
all other employees who: | ||
(A) do not meet the requirements of Subdivision | ||
(1)(B) but are otherwise eligible for membership in the retirement | ||
system; or | ||
(B) cannot be included as a qualifying employee | ||
under Subdivision (1) by application of Subsection (b-1). | ||
(f) The state shall make its required contribution under | ||
Subsection (a) based on the following percentages of the aggregate | ||
annual compensation of all members of the retirement system during | ||
each applicable fiscal year: | ||
(1) 7.25 percent beginning on September 1, 2019; | ||
(2) 7.50 percent beginning on September 1, 2020; | ||
(3) 7.75 percent beginning on September 1, 2021; | ||
(4) 8.00 percent beginning on September 1, 2022; and | ||
(5) 8.25 percent beginning on September 1, 2023, and | ||
each subsequent fiscal year. | ||
SECTION 4. (a) The Teacher Retirement System of Texas | ||
shall make a one-time supplemental payment of a retirement or death | ||
benefit, as provided by this section. | ||
(b) The one-time supplemental payment is payable not | ||
earlier than the first calendar month after the calendar month in | ||
which the state transfers to the Teacher Retirement System of Texas | ||
the amount described by Subsection (i) of this section. To the | ||
extent practicable, the Teacher Retirement System of Texas shall | ||
issue the supplemental payment on a date or dates that coincide with | ||
the regular annuity payment payable to each eligible annuitant. | ||
(c) The amount of the supplemental payment is equal to the | ||
lesser of: | ||
(1) the gross amount of the regular annuity payment to | ||
which the eligible annuitant is otherwise entitled for the calendar | ||
month immediately prior to the calendar month in which the Teacher | ||
Retirement System of Texas issues the one-time supplemental payment | ||
in accordance with Subsection (b) of this section; or | ||
(2) $500. | ||
(d) The supplemental payment is payable without regard to | ||
any forfeiture of benefits under Section 824.601, Government Code. | ||
The Teacher Retirement System of Texas shall make applicable tax | ||
withholding and other legally required deductions before | ||
disbursing the supplemental payment. A supplemental payment under | ||
this section is in addition to and not in lieu of the regular | ||
monthly annuity payment to which the eligible annuitant is | ||
otherwise entitled. | ||
(e) Subject to Subsection (f) of this section, to be | ||
eligible for the supplemental payment, a person must be, for the | ||
calendar month immediately prior to the calendar month in which the | ||
Teacher Retirement System of Texas issues the one-time supplemental | ||
payment in accordance with Subsection (b) of this section, and | ||
disregarding any forfeiture of benefits under Section 824.601, | ||
Government Code, an annuitant eligible to receive: | ||
(1) a standard retirement annuity payment; | ||
(2) an optional retirement annuity payment as either a | ||
retiree or beneficiary; | ||
(3) a life annuity payment under Section | ||
824.402(a)(4), Government Code; | ||
(4) an annuity for a guaranteed period of 60 months | ||
under Section 824.402(a)(3), Government Code; or | ||
(5) an alternate payee annuity payment under Section | ||
804.005, Government Code. | ||
(f) If the annuitant is a retiree or a beneficiary under an | ||
optional retirement payment plan, to be eligible for the | ||
supplemental payment, the effective date of the retirement of the | ||
member of the Teacher Retirement System of Texas must have been on | ||
or before December 31, 2018. If the annuitant is a beneficiary | ||
under Section 824.402(a)(3) or (4), Government Code, to be eligible | ||
for the supplemental payment, the date of death of the member of the | ||
retirement system must have been on or before December 31, 2018. | ||
The supplemental payment shall be made to an alternate payee who is | ||
an annuitant under Section 804.005, Government Code, only if the | ||
annuity payment to the alternate payee commenced on or before | ||
December 31, 2018. The supplemental payment is in addition to the | ||
guaranteed number of payments under Section 824.402(a)(3), Section | ||
824.204(c)(3) or (4), or Section 824.308(c)(3) or (4), Government | ||
Code, and may not be counted as one of the guaranteed monthly | ||
payments. | ||
(g) The supplemental payment does not apply to payments | ||
under: | ||
(1) Section 824.304(a), Government Code, relating to | ||
disability retirees with less than 10 years of service credit; | ||
(2) Section 824.804(b), Government Code, relating to | ||
participants in the deferred retirement option plan with regard to | ||
payments from their deferred retirement option plan accounts; | ||
(3) Section 824.501(a), Government Code, relating to | ||
retiree survivor beneficiaries who receive a survivor annuity in an | ||
amount fixed by statute; or | ||
(4) Section 824.404(a), Government Code, relating to | ||
active member survivor beneficiaries who receive a survivor annuity | ||
in an amount fixed by statute. | ||
(h) The board of trustees of the Teacher Retirement System | ||
of Texas shall determine the eligibility for and the amount and | ||
timing of a supplemental payment and the manner in which the payment | ||
is made. | ||
(i) The state shall appropriate to the Teacher Retirement | ||
System of Texas an amount equal to the cost of the one-time | ||
supplemental payment required by this section. This amount is in | ||
addition to the amount the state is required to contribute to the | ||
Teacher Retirement System of Texas under Section 825.404, | ||
Government Code, as amended by this Act. If the state does not | ||
transfer the appropriated amount described by this subsection, the | ||
Teacher Retirement System of Texas shall not issue the one-time | ||
supplemental payment required by this section. | ||
SECTION 5. This Act takes effect September 1, 2019. |