82R8578 TJS-D
By: Pitts H.B. No. 2441
A BILL TO BE ENTITLED
AN ACT
relating to public junior college employee participation in the
Teacher Retirement System of Texas.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 821.001(7), Government Code, is amended
to read as follows:
(7) "Employer" means any agents or agencies in the
state responsible for public education, including the governing
board of any school district or public junior college district
created under the laws of this state, any county school board, the
board of trustees, the board of regents of any college or
university, or any other legally constituted board or agency of any
public school, but excluding the State Board of Education, the
Texas Education Agency, and the State Board for Educator
Certification.
SECTION 2. Section 822.001, Government Code, is amended to
read as follows:
Sec. 822.001. MEMBERSHIP REQUIREMENT. (a) Membership in
the retirement system includes:
(1) all persons who were members of the retirement
system on the day before the effective date of this subtitle; [and]
(2) all employees of the public school system; and
(3) all employees of a public junior college.
(b) Membership in the retirement system is a condition of
employment for employees of the public school system or a public
junior college unless an employee is excluded from membership under
Section 822.002.
SECTION 3. Section 822.0015(a), Government Code, is amended
to read as follows:
(a) In lieu of participating in the Employees Retirement
System of Texas, the commissioner of education may elect to
participate in the retirement system in the same manner and under
the same conditions as a member who is an employee of the public
school system or a public junior college.
SECTION 4. Subchapter A, Chapter 822, Government Code, is
amended by adding Section 822.0016 to read as follows:
Sec. 822.0016. OPTIONAL MEMBERSHIP FOR CERTAIN QUALIFIED
EMPLOYEES. (a) In this section, "qualified employee" means a
person who:
(1) was employed by a public junior college before
December 31, 2011, and elected to participate in the optional
retirement program under Chapter 830; and
(2) is actively participating in the optional
retirement program.
(b) A qualified employee may make a one-time, irrevocable
election in a manner provided by the retirement system to
participate in the retirement system and cease participation in the
optional retirement program.
SECTION 5. Section 822.002, Government Code, is amended to
read as follows:
Sec. 822.002. EXCEPTIONS TO MEMBERSHIP REQUIREMENT. An
employee of the public school system or a public junior college is
not permitted to be a member of the retirement system if the
employee:
(1) is eligible and elects to participate in the
optional retirement program under Chapter 830;
(2) is solely employed by a public institution of
higher education that as a condition of employment requires the
employee to be enrolled as a student in the institution; or
(3) has retired under the retirement system and has
not been reinstated to membership pursuant to Section 824.005 or
824.307.
SECTION 6. Section 822.003(c), Government Code, is amended
to read as follows:
(c) A person does not terminate membership under Subsection
(a)(4) if the person:
(1) is performing military service creditable in the
retirement system;
(2) is on leave of absence from employment in a public
school or public junior college; or
(3) is earning service credit in another retirement
system covered by Chapter 803 or 805.
SECTION 7. Section 830.001, Government Code, is amended to
read as follows:
Sec. 830.001. PURPOSE OF CHAPTER. The purpose of this
chapter is to establish a complete retirement program for faculty
members employed in certain state-supported institutions of higher
education as an incentive that will attract high quality faculties
and thereby improve the level of education at state-supported
colleges and universities.
SECTION 8. Section 830.003, Government Code, is amended to
read as follows:
Sec. 830.003. APPLICATION. In this chapter, the term
"institution of higher education" includes the Texas Higher
Education Coordinating Board, the Texas State Technical College
System, and the institutions defined in Section 821.001(10), except
a public junior college. The term [but] excludes the Rodent and
Predatory Animal Control Service.
SECTION 9. Section 830.004(c), Government Code, is amended
to read as follows:
(c) An institution of higher education to which this chapter
applies may establish a governmental excess benefit arrangement as
provided by Section 415(m) of the Internal Revenue Code of 1986 (26
U.S.C. Section 415(m)) for the purpose of providing to participants
in the optional retirement program any portion of a participant's
benefits that would otherwise be payable under the terms of the
program except for the limitation on benefits imposed by Section
415 of the Internal Revenue Code of 1986 (26 U.S.C. Section 415).
The governing board of an institution of higher education to which
this chapter applies may take any action necessary to establish and
implement a governmental excess benefit arrangement authorized in
accordance with this subsection.
SECTION 10. Section 830.005, Government Code, is amended to
read as follows:
Sec. 830.005. EXEMPTION FROM TAXES. If qualified to do
business in this state, a life insurance or annuity company is
exempt from the payment of franchise or premium taxes on annuity or
group insurance policies issued under a benefit program authorized
and at least partly paid for by the governing board of an
institution of higher education to which this chapter applies or
the Texas Education Agency.
SECTION 11. Section 830.006(a), Government Code, is amended
to read as follows:
(a) The governing board of each institution of higher
education to which this chapter applies, other than the Texas
Higher Education Coordinating Board, shall annually submit a report
to the coordinating board that includes information concerning the
number of participants and eligible positions and the amount of
contributions.
SECTION 12. Section 830.101(a), Government Code, is amended
to read as follows:
(a) The governing board of each institution of higher
education to which this chapter applies shall provide an
opportunity to participate in the optional retirement program to
all faculty members in the component institutions governed by the
board. The State Board of Education shall provide an opportunity to
participate in the optional retirement program to the commissioner
of education.
SECTION 13. Section 830.103, Government Code, is amended to
read as follows:
Sec. 830.103. EFFECT OF TRANSFERS AND CHANGES IN EMPLOYMENT
STATUS. (a) An institution of higher education to which this
chapter applies shall accept the transfer of a participant's
optional retirement program from another institution of higher
education to which this chapter applies or from the Texas Education
Agency. The Texas Education Agency shall accept the transfer of a
participant's optional retirement program from an institution of
higher education to which this chapter applies if the participant
becomes commissioner of education.
(b) If, after participating in the optional retirement
program for at least one year, a person becomes employed in an
institution of higher education to which this chapter applies in a
position normally covered by the retirement system, the person
shall continue participation in the optional retirement program if
the person has had no intervening employment in the public schools
other than as commissioner of education or a position in an
institution of higher education to which this chapter applies.
SECTION 14. Section 830.105(b), Government Code, is amended
to read as follows:
(b) A change of company providing optional retirement
program benefits or a participant's transfer between institutions
of higher education to which this chapter applies is not a
termination of employment.
SECTION 15. Section 830.106, Government Code, is amended to
read as follows:
Sec. 830.106. ELIGIBILITY FOR RESUMPTION OF MEMBERSHIP. A
participant in the optional retirement program is not eligible for
membership in the retirement system unless:
(1) the person:
(A) [(1)] terminates employment covered by the
optional retirement program; and
(B) [(2)] becomes employed in the public school
system or with a state agency in a position that is not eligible for
participation in the optional retirement program; or
(2) the person is a qualified employee under Section
822.0016 who makes an election to participate in the retirement
system.
SECTION 16. Sections 830.2015(a) and (c), Government Code,
are amended to read as follows:
(a) Each fiscal year, the governing board of an institution
of higher education to which this chapter applies may make a
contribution to the optional retirement program as provided by this
section. The governing board may use any source of funds for the
contribution.
(c) The governing board of an institution of higher
education to which this chapter applies may contribute an amount
under this section to the benefit of a participant employed by the
[an] institution of higher education on or before August 31, 1995,
that is different from the amount the governing board contributes
to the benefit of a participant employed by the [an] institution of
higher education after that date.
SECTION 17. Sections 830.202(c), (d), (e), and (g),
Government Code, are amended to read as follows:
(c) The disbursing officer of an institution of higher
education to which this chapter applies and, if applicable, of the
Texas Education Agency shall pay the contributions collected under
this section to a company providing an optional retirement program
for that institution not later than the third business day after the
date the funds become legally available. If possible, the
disbursing officer shall send the state's contributions and the
participants' contributions together, and otherwise shall send the
participants' contributions at the time of withholding and the
state's contributions on receipt from the comptroller. This
subsection does not apply to a supplemental payroll. This
subsection applies only to a currently authorized company or a
company with at least 50 participants at the institution.
(d) An institution of higher education to which this chapter
applies and, if applicable, the Texas Education Agency shall
certify to the comptroller, in the manner provided for estimate of
state contributions to the retirement system, estimates of funds
required for the payments by the state under this section.
(e) The disbursing officer of an institution of higher
education to which this chapter applies and, if applicable, of the
Texas Education Agency, shall:
(1) send contributions to a company providing an
optional retirement program for the institution by electronic
transfer if the institution is currently able to send funds by
electronic transfer; or
(2) certify to the Texas Higher Education Coordinating
Board that the company is unable to receive funds by electronic
transfer and send contributions by paper check.
(g) At least once each fiscal year, an institution of higher
education to which this chapter applies and the Texas Education
Agency shall give notice to each participant in the optional
retirement program at the institution or agency indicating which
companies are unable to receive funds by electronic transfer.
SECTION 18. Section 830.203(a)(3), Government Code, is
amended to read as follows:
(3) "Noneducational and general funds" means all funds
of an institution of higher education to which this chapter applies
except those funds used as a method of financing for an
institutional appropriation in the General Appropriations Act or
dedicated by the Constitution of the State of Texas.
SECTION 19. Section 1551.003(14), Insurance Code, is
amended to read as follows:
(14) "State agency" means a commission, board,
department, division, institution of higher education other than a
public junior college, or other agency of this state created by the
constitution or statutes of this state. The term also includes the
Texas Municipal Retirement System and the Texas County and District
Retirement System.
SECTION 20. Section 1551.006(b), Insurance Code, is amended
to read as follows:
(b) In this chapter, "institution of higher education" does
not include:
(1) an entity in The University of Texas System, as
described by Section 65.02, Education Code; [and]
(2) an entity in The Texas A&M University System, as
described by Subtitle D, Title 3, Education Code, including the
Texas Veterinary Medical Diagnostic Laboratory; or
(3) a public junior college.
SECTION 21. Section 1551.102, Insurance Code, is amended by
adding Subsection (j) to read as follows:
(j) An individual is eligible to participate in the group
benefits program as provided by Subsection (a) if the individual
retires under Chapter 822, Government Code, after making an
election to participate in the Teacher Retirement System of Texas
under Section 822.0016, Government Code, and the individual:
(1) is at least 50 years old and has at least 10 years
of eligible service credit;
(2) has at least 25 years of eligible service credit;
or
(3) has at least 10 years of eligible service credit
and the sum of the individual's service credit and attained age
equals or exceeds the number 70.
SECTION 22. Section 1575.002, Insurance Code, is amended by
amending Subdivision (1) and adding Subdivision (5-a) to read as
follows:
(1) "Active employee" means a contributing member of
the Teacher Retirement System of Texas who:
(A) is employed by:
(i) a public school; or
(ii) a public junior college; and
(B) is not entitled to coverage under a plan
provided under Chapter 1551 or 1601.
(5-a) "Public junior college" has the meaning assigned
by Section 61.003, Education Code.
SECTION 23. Section 1575.204(a), Insurance Code, is amended
to read as follows:
(a) Each state fiscal year, each public school and public
junior college shall contribute to the fund the amount prescribed
by the General Appropriations Act, which may not be less than 0.25
percent or greater than 0.75 percent of the salary of each active
employee of the public school or public junior college. The public
school or public junior college shall make the contributions on a
monthly basis and as otherwise prescribed by the trustee.
SECTION 24. Section 1575.211, Insurance Code, is amended to
read as follows:
Sec. 1575.211. COST SHARING. (a) The total costs for the
operation of the group program shall be shared among the state, the
public schools and public junior colleges, the active employees,
and the retirees in the manner prescribed by the General
Appropriations Act.
(b) In determining the allocation of total costs under this
section, the state shall pay not more than 55 percent of the total
costs, retirees shall pay at least 30 percent of the total costs,
and the balance shall be paid by active employees and public schools
and public junior colleges.
SECTION 25. Section 1575.402(a), Insurance Code, is amended
to read as follows:
(a) The Retirees Advisory Committee is composed of the
following nine members appointed by the trustee:
(1) one member who is an active school or public junior
college administrator;
(2) one member who is a retired school or public junior
college administrator;
(3) two members who are active teachers or public
junior college faculty members;
(4) three members who are retired teachers or public
junior college faculty members;
(5) one member who is an active member of the auxiliary
personnel of a school district or public junior college district;
and
(6) one member who is a retired member of the auxiliary
personnel of a school district or public junior college district.
SECTION 26. Section 1575.403(b), Insurance Code, is amended
to read as follows:
(b) Five members' terms, including the terms of the active
school or public junior college administrator, one active teacher
or public junior college faculty member, two retired teachers or
public junior college faculty members, and the retired member of
the auxiliary personnel, expire February 1, 2002, and every fourth
year after that date.
SECTION 27. Section 1579.002(5), Insurance Code, is amended
to read as follows:
(5) "Participating entity" means an entity
participating in the uniform group coverage program established
under this chapter. The term includes:
(A) a school district;
(B) a public junior college district;
(C) another educational district whose employees
are members of the Teacher Retirement System of Texas;
(D) [(C)] a regional education service center;
and
(E) [(D)] a charter school that meets the
requirements of Section 1579.154.
SECTION 28. Sections 1579.151(a) and (b), Insurance Code,
are amended to read as follows:
(a) Each school district or public junior college district
with 500 or fewer employees and each regional education service
center is required to participate in the program.
(b) Notwithstanding Subsection (a), a school district or
public junior college district otherwise subject to Subsection (a)
that, on January 1, 2001, was individually self-funded for the
provision of health coverage to its employees may elect not to
participate in the program.
SECTION 29. Section 1579.152, Insurance Code, is amended to
read as follows:
Sec. 1579.152. PARTICIPATION OF OTHER SCHOOL DISTRICTS. A
[Effective September 1, 2005, a] school district or public junior
college district with more than 500 employees may elect to
participate in the program. A school district or public junior
college district that elects to participate under this section
shall apply for participation in the manner prescribed by the
trustee by rule.
SECTION 30. Section 1579.251(a), Insurance Code, is amended
to read as follows:
(a) The state shall assist employees of participating
school districts, public junior college districts, and charter
schools in the purchase of group health coverage under this chapter
by providing for each covered employee the amount of $900 each state
fiscal year or a greater amount as provided by the General
Appropriations Act. The state contribution, as applicable, shall
be distributed through the school finance formulas under Chapters
41 and 42, Education Code, and used by school districts and charter
schools as provided by Section 42.260, Education Code.
SECTION 31. (a) The changes to Sections 822.001 and
822.002, Government Code, as amended by this Act, apply only to a
person who is first employed by a public junior college on or after
January 1, 2012, and to a former employee who has withdrawn
retirement contributions under Section 822.003, Government Code,
and is reemployed by a public junior college on or after January 1,
2012.
(b) The changes to Section 1575.002, Insurance Code, as
amended by this Act, apply only to a person who is first employed by
a public junior college on or after January 1, 2012.
SECTION 32. This Act takes effect September 1, 2011.