Texas 2009 - 81st Regular

Texas House Bill HB2829 Compare Versions

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1	1	H.B. No. 2829
2	2
3	3
4	4	AN ACT
5	5	relating to participation in and benefits and administration of
6	6	retirement systems for firefighters in certain municipalities.
7	7	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	8	SECTION 1. Section 1.02, Chapter 183 (S.B. 598), Acts of the
9	9	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
10	10	Texas Civil Statutes), is amended by adding Subdivision (13) to
11	11	read as follows:
12	12	(13) "Spouse" means an individual to whom a member is
13	13	legally married under Subtitle A, Title 1, Family Code, or a
14	14	comparable law of another jurisdiction, provided that, in the case
15	15	of an informal marriage in this state, the marriage must be
16	16	evidenced by a declaration of informal marriage recorded in
17	17	accordance with Subchapter E, Chapter 2, Family Code.
18	18	SECTION 2. Section 2.03(c), Chapter 183 (S.B. 598), Acts of
19	19	the 64th Legislature, Regular Session, 1975 (Article 6243e.1,
20	20	Vernon's Texas Civil Statutes), is amended to read as follows:
21	21	(c) Each election is by secret written ballot on a date the
22	22	board of trustees determines. Only persons who have been nominated
23	23	may be listed on the written ballot. Nominations may be made in
24	24	person, by mail, or by telephone to the office of the fund and must
25	25	be received between September [October] 1 and September [October]
26	26	15.
27	27	SECTION 3. Section 2.11, Chapter 183 (S.B. 598), Acts of the
28	28	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
29	29	Texas Civil Statutes), is amended to read as follows:
30	30	Sec. 2.11. RULEMAKING. The board of trustees shall adopt
31	31	rules and perform reasonable activities it considers necessary or
32	32	desirable for the efficient administration of the fund and to
33	33	maintain the qualified status of the fund under Section 401(a) of
34	34	the Internal Revenue Code.
35	35	SECTION 4. Article 2, Chapter 183 (S.B. 598), Acts of the
36	36	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
37	37	Texas Civil Statutes), is amended by adding Section 2.13 to read as
38	38	follows:
39	39	Sec. 2.13. CONFIDENTIALITY OF INFORMATION ABOUT MEMBERS,
40	40	RETIREES, ANNUITANTS, OR BENEFICIARIES. (a) Information contained
41	41	in records in the custody of the fund concerning an individual
42	42	member, retiree, annuitant, or beneficiary is confidential under
43	43	Section 552.101, Government Code, and may not be disclosed in a form
44	44	identifiable with a specific individual unless:
45	45	(1) the information is disclosed to:
46	46	(A) the individual or the individual's attorney,
47	47	guardian, executor, administrator, conservator, or other person
48	48	who the administrator of the fund determines is acting in the
49	49	interest of the individual or the individual's estate;
50	50	(B) a spouse or former spouse of the individual
51	51	after the administrator of the fund determines that the information
52	52	is relevant to the spouse's or former spouse's interest in member
53	53	accounts, benefits, or other amounts payable by the fund;
54	54	(C) a governmental official or employee after the
55	55	administrator of the fund determines that disclosure of the
56	56	information requested is reasonably necessary to the performance of
57	57	the duties of the official or employee; or
58	58	(D) a person authorized by the individual in
59	59	writing to receive the information; or
60	60	(2) the information is disclosed pursuant to a
61	61	subpoena and the administrator of the fund determines that the
62	62	individual will have a reasonable opportunity to contest the
63	63	subpoena.
64	64	(b) This section does not prevent the disclosure of the
65	65	status or identity of an individual as a member, former member,
66	66	retiree, deceased member or retiree, or beneficiary of the fund.
67	67	(c) A determination and disclosure under Subsection (a) may
68	68	be made without notice to the individual member, retiree,
69	69	annuitant, or beneficiary.
70	70	SECTION 5. Section 5.04, Chapter 183 (S.B. 598), Acts of the
71	71	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
72	72	Texas Civil Statutes), is amended by amending Subsection (b) and
73	73	adding Subsection (b-1) to read as follows:
74	74	(b) The three percent factor used in this section may be
75	75	changed to some other percent if the change:
76	76	(1) is first approved by the board's actuary;
77	77	(2) is approved by the board of trustees;
78	78	(3) applies [only] to one or any combination of the
79	79	following groups:
80	80	(A) firefighters who are employed on an active,
81	81	full-time basis in the fire department at the time of the change;
82	82	(B) firefighters who begin service with the fire
83	83	department after the change becomes effective; and
84	84	(C) members who retire under Section 5.06 of this
85	85	Act after the change becomes effective; and
86	86	(4) does not reduce a member's benefit for service
87	87	credit accumulated before the date of the change.
88	88	(b-1) In determining whether to approve an increase in the
89	89	factor under Subsection (b) of this section, the board's actuary
90	90	shall take into consideration whether the fund has reserves
91	91	sufficient to enable the payment of a cost-of-living adjustment
92	92	under Section 9.04(a) of this Act to all current members and
93	93	survivors at a level that is equal to the average percentage
94	94	increase in the Consumer Price Index for All Urban Consumers as
95	95	determined by the United States Department of Labor for the 10
96	96	annual periods preceding the proposed effective date of the change.
97	97	SECTION 6. Section 7.02, Chapter 183 (S.B. 598), Acts of the
98	98	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
99	99	Texas Civil Statutes), is amended to read as follows:
100	100	Sec. 7.02. SURVIVING SPOUSE OF RETIREE. (a) On the death of
101	101	a retiree, the retiree's surviving spouse is entitled to receive an
102	102	immediate monthly benefit from the fund of 75 percent of the
103	103	retirement benefit that was being paid to the retiree if the spouse:
104	104	(1) was married to the retiree at the time of the
105	105	retiree's retirement; or
106	106	(2) married the retiree after the retiree's retirement
107	107	and was married to the retiree for at least 24 consecutive months.
108	108	(b) For purposes of Subsection (a)(1) of this section, with
109	109	respect to an informal marriage established in this state, a
110	110	surviving spouse is considered married to a retiree as of the date a
111	111	declaration of informal marriage was recorded in accordance with
112	112	Subchapter E, Chapter 2, Family Code.
113	113	SECTION 7. Section 9.04, Chapter 183 (S.B. 598), Acts of the
114	114	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
115	115	Texas Civil Statutes), is amended by amending Subsections (a) and
116	116	(b) and adding Subsections (a-1), (a-2), (a-3), (a-4), and (b-1) to
117	117	read as follows:
118	118	(a) Subject to this section and except [Except] as provided
119	119	by Section 5.05 of this Act, a person receiving a retirement or
120	120	survivor's benefit under this Act is entitled each calendar year to
121	121	a [an annual] cost-of-living adjustment of that person's benefit
122	122	calculated in accordance with this section.
123	123	(a-1) The annual cost-of-living adjustment under this
124	124	section:
125	125	(1) is based on the collective adjustment amount
126	126	calculated in accordance with Subsection (a-2) of this section and
127	127	allocated among persons eligible for an adjustment under this
128	128	section in a manner and in an amount determined by the board of
129	129	trustees;
130	130	(2) may take effect at any time during a given calendar
131	131	year, as determined by the board of trustees; and
132	132	(3) may not reduce a person's benefit to an amount less
133	133	than the person received when the benefit first was paid to that
134	134	person.
135	135	(a-2) The collective adjustment amount described by
136	136	Subsection (a-1) of this section:
137	137	(1) is an amount equal to the actuarial value, as
138	138	determined by the board's actuary based on the interest and
139	139	mortality assumptions adopted by the board of trustees for the most
140	140	recent actuarial valuation of the fund, of the percentage [any]
141	141	increase in the Consumer Price Index for All Urban Consumers as
142	142	determined by the United States Department of Labor for the
143	143	applicable determination period immediately preceding the date the
144	144	cost-of-living adjustment is to take effect, multiplied by the
145	145	total amount of benefits payable in the month immediately preceding
146	146	the date an adjustment is to take effect to persons who are eligible
147	147	to receive an adjustment under this section; and
148	148	(2) if applicable:
149	149	(A) is reduced by an amount that the board's
150	150	actuary determines is necessary to maintain the financial stability
151	151	of the fund; or
152	152	(B) is increased in accordance with Subsection
153	153	(b) of this section.
154	154	(a-3) For purposes of Subsection (a-2) of this section, the
155	155	applicable determination period is the shorter of:
156	156	(1) 12 months; or
157	157	(2) the period since the last adjustment [increase in
158	158	benefits] under this section.
159	159	(a-4) In determining whether to reduce the collective
160	160	adjustment amount under Subsection (a-2) of this section, the
161	161	board's actuary may not take into consideration the cost of future
162	162	adjustments under this section.
163	163	(b) The board of trustees may increase the collective [If
164	164	an] adjustment amount under Subsection (a-2) [(a)] of this section
165	165	if:
166	166	(1) [would exceed one percent of a person's benefit,
167	167	the portion of the adjustment that exceeds one percent of the
168	168	benefit may not be made under this section unless] the board's
169	169	actuary has advised the board of trustees that the increase
170	170	[adjustment] would not impair the financial stability of the fund;
171	171	and
172	172	(2) the increase [adjustment] has been approved by the
173	173	affirmative vote of a majority of the board of trustees. [If an
174	174	adjustment under Subsection (a) of this section would be one
175	175	percent or less of a person's benefit, the adjustment may not be
176	176	made under this section unless the board's actuary has advised the
177	177	board of trustees that the adjustment would not impair the
178	178	financial stability of the fund.]
179	179	(b-1) In determining whether an adjustment would impair the
180	180	financial stability of the fund under Subsection (b) of this
181	181	section, the board's actuary shall take into consideration the cost
182	182	of future adjustments under this section.
183	183	SECTION 8. Section 11.01, Chapter 183 (S.B. 598), Acts of
184	184	the 64th Legislature, Regular Session, 1975 (Article 6243e.1,
185	185	Vernon's Texas Civil Statutes), is amended to read as follows:
186	186	Sec. 11.01. INVESTMENTS. The board of trustees in its sole
187	187	discretion may invest, reinvest, or change the assets of the fund.
188	188	The board of trustees shall invest the funds in whatever
189	189	instruments or investments the board considers prudent. In making
190	190	investments for the fund, the board of trustees shall discharge its
191	191	duties with the care, skill, prudence, and diligence under the
192	192	circumstances then prevailing that a prudent person acting in a
193	193	similar capacity and familiar with such matters would use in the
194	194	conduct of an enterprise of a similar character and with similar
195	195	aims. [PERMITTED INVESTMENTS. When the board of trustees
196	196	determines that there is in the fund a surplus exceeding the
197	197	reasonable, safe amount necessary to take care of the current
198	198	demands on the fund, the surplus, or so much of it as the board of
199	199	trustees considers prudent, may be invested in:
200	200	[(1) direct obligations of or obligations the
201	201	principal and interest of which are guaranteed by the United States
202	202	or its agencies or instrumentalities;
203	203	[(2) short-term investment funds, mutual funds, or
204	204	their equivalent that are rated as investment quality or higher by a
205	205	nationally recognized investment rating firm;
206	206	[(3) fully collateralized or direct repurchase
207	207	agreements, including direct and reverse security repurchase
208	208	agreements and security lending agreements that:
209	209	[(A) have a defined termination date;
210	210	[(B) are secured by obligations described by this
211	211	section or by cash; and
212	212	[(C) are pledged with a third party selected or
213	213	approved by a majority vote of the board of trustees;
214	214	[(4) corporate bonds, including convertible bonds,
215	215	collateralized mortgage obligations, and asset-backed securities,
216	216	rated as investment quality or higher by a nationally recognized
217	217	investment rating firm;
218	218	[(5) common stocks, preferred stocks, and convertible
219	219	preferred stocks of companies incorporated in the United States and
220	220	foreign stocks that are designated in United States dollars and
221	221	that are registered with the Securities and Exchange Commission and
222	222	listed on a United States exchange or by the National Association of
223	223	Securities Dealers Automated Quotations;
224	224	[(6) foreign equity and fixed income investments;
225	225	[(7) mutual funds, common funds, and their equivalents
226	226	that contain only items listed in Subdivisions (1)-(6) of this
227	227	section; and
228	228	[(8) convertible stocks and bonds recognized as
229	229	investment quality or higher by a nationally recognized investment
230	230	rating firm or by the investment manager.]
231	231	SECTION 9. Section 11.03, Chapter 183 (S.B. 598), Acts of
232	232	the 64th Legislature, Regular Session, 1975 (Article 6243e.1,
233	233	Vernon's Texas Civil Statutes), is amended to read as follows:
234	234	Sec. 11.03. INVESTMENT POLICY. (a) The board of trustees
235	235	shall adopt and maintain a written investment policy regarding the
236	236	investment of fund assets.
237	237	(b) The board of trustees may not adopt an amendment to the
238	238	investment policy adopted under this section unless the proposed
239	239	amendment is approved by the affirmative vote of a majority of the
240	240	members of the board at not fewer than three regular meetings of the
241	241	board. [LIMITATIONS ON INVESTMENTS. The fund may not own more than
242	242	five percent of the voting stock of any one corporation. Under an
243	243	investment measure at market:
244	244	[(1) total fixed-income investments should not
245	245	represent less than 30 percent of the value of the investment
246	246	portfolio;
247	247	[(2) total investments in common stocks should not
248	248	represent more than 70 percent of the value of the investment
249	249	portfolio;
250	250	[(3) total investments in common stocks and bonds of
251	251	foreign corporations may not represent more than 20 percent of the
252	252	value of the investment portfolio; and
253	253	[(4) total investments in any one corporation may not
254	254	represent more than five percent of the value of the investment
255	255	portfolio.]
256	256	SECTION 10. Sections 9.04(c) and (d), Chapter 183 (S.B.
257	257	598), Acts of the 64th Legislature, Regular Session, 1975 (Article
258	258	6243e.1, Vernon's Texas Civil Statutes), are repealed.
259	259	SECTION 11. As soon as practicable after the effective date
260	260	of this Act, the board of trustees of the firefighters relief and
261	261	retirement fund shall adopt the written investment policy required
262	262	by Section 11.03, Chapter 183 (S.B. 598), Acts of the 64th
263	263	Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
264	264	Texas Civil Statutes), as amended by this Act.
265	265	SECTION 12. This Act takes effect September 1, 2009.
266	266	______________________________ ______________________________
267	267	President of the Senate Speaker of the House
268	268	I certify that H.B. No. 2829 was passed by the House on April
269	269	28, 2009, by the following vote: Yeas 149, Nays 0, 1 present, not
270	270	voting.
271	271	______________________________
272	272	Chief Clerk of the House
273	273	I certify that H.B. No. 2829 was passed by the Senate on May
274	274	21, 2009, by the following vote: Yeas 31, Nays 0.
275	275	______________________________
276	276	Secretary of the Senate
277	277	APPROVED: _____________________
278	278	Date
279	279	_____________________
280	280	Governor