Bill Text: TX HB3542 | 2011-2012 | 82nd Legislature | Engrossed

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Bill Title: Relating to a supplemental payment for retirees of the Teacher Retirement System of Texas and the unfunded actuarial liabilities allowed under that system.

Spectrum: Moderate Partisan Bill (Republican 22-5)

Status: (Engrossed - Dead) 2011-05-16 - Referred to State Affairs [HB3542 Detail]

Download: Texas-2011-HB3542-Engrossed.html

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82R23984 SGA-D
By: Gonzales of Williamson, Huberty, H.B. No. 3542
McClendon, Strama, Veasey, et al.

A BILL TO BE ENTITLED
AN ACT
relating to a supplemental payment for retirees of the Teacher
Retirement System of Texas and the unfunded actuarial liabilities
allowed under that system.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. This Act is not intended to supplant the power or
discretion of the legislature to provide supplemental payments to
annuitants of the Teacher Retirement System of Texas. This Act
provides an additional tool by which the legislature, in enacting
this law, may provide those annuitants with a much-needed one-time
supplemental payment without requesting additional funds from
general revenue.
SECTION 2. Section 821.006, Government Code, is amended by
adding Subsections (c), (d), and (e) to read as follows:
(c) Notwithstanding Subsections (a) and (b), the retirement
system may provide a one-time supplemental payment to 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);
(4) an annuity for a guaranteed period of 60 months
under Section 824.402(a)(3); or
(5) an alternate payee annuity payment under Section
804.005.
(d) A one-time supplemental payment under Subsection (c) is
authorized, even if the amortization period for the unfunded
actuarial liabilities of the retirement system exceeds 30 years by
one or more years, only if the board of trustees determines that at
the time of the supplemental payment the payment can be made while
preserving the ability of the retirement system to meet at least 80
percent of the system's pension obligations.
(e) The funding for a one-time supplemental payment under
Subsection (c) must come from the earnings the retirement system
makes on its investments as provided by this subsection. The
supplemental payment may be made at any time during the period
beginning September 1, 2011, and ending December 31, 2013, only if,
during the preceding fiscal year, the return on investments, as
provided by the actuarial valuation on August 31 of that year,
exceeds eight percent by an amount sufficient to pay for the
supplemental payment. Subsections (c) and (d) and this subsection
expire January 1, 2014.
SECTION 3. Section 825.402, Government Code, is amended by
adding Subsection (c-1) to read as follows:
(c-1) Subsection (c) does not apply to a supplemental
payment authorized by Sections 821.006(c), (d), and (e). This
subsection expires January 1, 2014.
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 Section 821.006, Government Code, as
amended by this Act, and this section.
(b) The supplemental payment is payable not later than
December 31, 2013, and, to the extent practicable, 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 month of
August 2011; or
(2) $2,400.
(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
month of August 2011, 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, 2008. 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, 2008.
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, 2008. The supplemental payment is in addition to the
guaranteed number of payments under Section 824.402(a)(3),
824.204(c)(3) or (4), or 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) Except as provided by this section, 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.
SECTION 5. This Act takes effect September 1, 2011.