Texas 2017 - 85th Regular

Texas House Bill HB4075 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	85R9176 TSR-F
2	2	By: Flynn H.B. No. 4075
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to contributions to, benefits from, membership in, and the
8	8	administration of systems and programs administered by the Teacher
9	9	Retirement System of Texas.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Sections 22.004(b) and (d), Education Code, are
12	12	amended to read as follows:
13	13	(b) A district that does not participate in the program
14	14	described by Subsection (a) shall make available to its employees
15	15	group health coverage provided by a risk pool established by one or
16	16	more school districts under Chapter 172, Local Government Code, or
17	17	under a policy of insurance or group contract issued by an insurer,
18	18	a company subject to Chapter 842, Insurance Code, or a health
19	19	maintenance organization under Chapter 843, Insurance Code. The
20	20	coverage must meet the substantive coverage requirements of Chapter
21	21	1251, Subchapter A, Chapter 1364, and Subchapter A, Chapter 1366,
22	22	Insurance Code, and any other law applicable to group health
23	23	insurance policies or contracts issued in this state. The coverage
24	24	must include major medical treatment but may exclude experimental
25	25	procedures. In this subsection, "major medical treatment" means a
26	26	medical, surgical, or diagnostic procedure for illness or
27	27	injury. The coverage may include managed care or preventive care
28	28	and must be comparable to the basic health coverage provided under
29	29	Chapter 1551, Insurance Code. The [board of trustees of the Teacher
30	30	Retirement System of Texas shall adopt rules to determine whether a
31	31	school district's group health coverage is comparable to the basic
32	32	health coverage specified by this subsection. The rules must
33	33	provide for consideration of the] following factors shall be
34	34	considered [concerning the district's coverage] in determining
35	35	whether the district's coverage is comparable to the basic health
36	36	coverage specified by this subsection:
37	37	(1) the deductible amount for service provided inside
38	38	and outside of the network;
39	39	(2) the coinsurance percentages for service provided
40	40	inside and outside of the network;
41	41	(3) the maximum amount of coinsurance payments a
42	42	covered person is required to pay;
43	43	(4) the amount of the copayment for an office visit;
44	44	(5) the schedule of benefits and the scope of
45	45	coverage;
46	46	(6) the lifetime maximum benefit amount; and
47	47	(7) verification that the coverage is issued by a
48	48	provider licensed to do business in this state by the Texas
49	49	Department of Insurance or is provided by a risk pool authorized
50	50	under Chapter 172, Local Government Code, or that a district is
51	51	capable of covering the assumed liabilities in the case of coverage
52	52	provided through district self-insurance.
53	53	(d) Each district [shall report the district's compliance
54	54	with this section to the executive director of the Teacher
55	55	Retirement System of Texas not later than March 1 of each
56	56	even-numbered year in the manner required by the board of trustees
57	57	of the Teacher Retirement System of Texas. For a district] that
58	58	does not participate in the program described by Subsection (a)
59	59	shall prepare a report addressing the district's compliance with
60	60	this section. The[, the] report must be available for review,
61	61	together with the policy or contract for the group health coverage
62	62	plan, at the central administrative office of each campus in the
63	63	district and be posted on the district's Internet website if the
64	64	district maintains a website, must be based on the district group
65	65	health coverage plan in effect during the current plan year, and
66	66	must include:
67	67	(1) appropriate documentation of:
68	68	(A) the district's contract for group health
69	69	coverage with a provider licensed to do business in this state by
70	70	the Texas Department of Insurance or a risk pool authorized under
71	71	Chapter 172, Local Government Code; or
72	72	(B) a resolution of the board of trustees of the
73	73	district authorizing a self-insurance plan for district employees
74	74	and of the district's review of district ability to cover the
75	75	liability assumed;
76	76	(2) the schedule of benefits;
77	77	(3) the premium rate sheet, including the amount paid
78	78	by the district and employee;
79	79	(4) the number of employees covered by the health
80	80	coverage plan offered by the district; and
81	81	(5) information concerning the ease of completing the
82	82	report[, as required by the executive director of the Teacher
83	83	Retirement System of Texas; and
84	84	[(6) any other information considered appropriate by
85	85	the executive director of the Teacher Retirement System of Texas].
86	86	SECTION 2. Subchapter A, Chapter 821, Government Code, is
87	87	amended by adding Section 821.0011 to read as follows:
88	88	Sec. 821.0011. DETERMINATION OF EMPLOYEE OR INDEPENDENT
89	89	CONTRACTOR STATUS. In determining whether an individual is an
90	90	employee or independent contractor of an employer, the retirement
91	91	system shall use the test applied under common law and any guidance
92	92	issued by the Internal Revenue Service regarding factors to
93	93	consider when determining an individual's employment status.
94	94	SECTION 3. Section 822.201(b), Government Code, is amended
95	95	to read as follows:
96	96	(b) "Salary and wages" as used in Subsection (a) means:
97	97	(1) normal periodic payments of money for service the
98	98	right to which accrues on a regular basis in proportion to the
99	99	service performed;
100	100	(2) amounts by which the member's salary is reduced
101	101	under a salary reduction agreement authorized by Chapter 610;
102	102	(3) amounts that would otherwise qualify as salary and
103	103	wages under Subdivision (1) but are not received directly by the
104	104	member pursuant to a good faith, voluntary written salary reduction
105	105	agreement in order to finance payments to a deferred compensation
106	106	or tax sheltered annuity program specifically authorized by state
107	107	law or to finance benefit options under a cafeteria plan qualifying
108	108	under Section 125 of the Internal Revenue Code of 1986, if:
109	109	(A) the program or benefit options are made
110	110	available to all employees of the employer; and
111	111	(B) the benefit options in the cafeteria plan are
112	112	limited to one or more options that provide deferred compensation,
113	113	group health and disability insurance, group term life insurance,
114	114	dependent care assistance programs, or group legal services plans;
115	115	(4) performance pay awarded to an employee by a school
116	116	district as part of a total compensation plan approved by the board
117	117	of trustees of the district and meeting the requirements of
118	118	Subsection (e);
119	119	(5) the benefit replacement pay a person earns under
120	120	Subchapter H, Chapter 659, except as provided by Subsection (c);
121	121	(6) stipends paid to teachers in accordance with
122	122	Section 21.410, 21.411, 21.412, or 21.413, Education Code;
123	123	(7) amounts by which the member's salary is reduced or
124	124	that are deducted from the member's salary as authorized by
125	125	Subchapter J, Chapter 659;
126	126	(8) a merit salary increase made under Section 51.962,
127	127	Education Code;
128	128	(9) amounts received under the relevant parts of the
129	129	educator excellence awards program under Subchapter O, Chapter 21,
130	130	Education Code, or a mentoring program under Section 21.458,
131	131	Education Code, that authorize compensation for service;
132	132	(10) salary amounts designated as health care
133	133	supplementation by an employee under Subchapter D, Chapter 22,
134	134	Education Code; and
135	135	(11) to the extent required by Sections 3401(h) and
136	136	414(u)(12) [414(u)(2)], Internal Revenue Code of 1986,
137	137	differential wage payments received by an individual from an
138	138	employer on or after January 1, 2009, while the individual is
139	139	performing qualified military service as defined by Section 414(u),
140	140	Internal Revenue Code of 1986.
141	141	SECTION 4. Section 823.004(a), Government Code, is amended
142	142	to read as follows:
143	143	(a) All credit for military service, out-of-state service,
144	144	developmental leave, work experience in a career or technological
145	145	field, and service transferred to the retirement system under
146	146	Chapter 805 shall be computed on a September 1 through August 31
147	147	school year. Payments for service described by this section must be
148	148	completed:
149	149	(1) not later than two calendar months after the later
150	150	of the member's retirement date or the last day of the month in
151	151	which the member submits a retirement application; and
152	152	(2) before the later of the due date for the member's
153	153	first monthly annuity payment or the date on which the retirement
154	154	system issues the first monthly annuity payment to the member.
155	155	SECTION 5. Section 823.403, Government Code, is amended by
156	156	amending Subsections (c) and (d) and adding Subsection (d-1) to
157	157	read as follows:
158	158	(c) On receipt of a certification under Subsection (b) and
159	159	payment under Subsection (d) of this section, the retirement system
160	160	shall grant any credit to which a retiree who is a subject of the
161	161	certification is entitled. An annuity payment may not be increased
162	162	until the retirement system is paid the full cost of the service
163	163	credit. [The increase in the annuity payment begins with the first
164	164	payment that becomes due after certification and payment.]
165	165	(d) In order to receive credit, the member shall pay to the
166	166	retirement system at the time service credit is granted under this
167	167	section the actuarial present value of the additional standard
168	168	retirement annuity benefits under the option selected by the member
169	169	that would be attributable to the conversion of the unused state
170	170	personal or sick leave into the service credit based on rates and
171	171	tables recommended by the actuary and adopted by the board of
172	172	trustees. Except as provided by this subsection, the retirement
173	173	system must receive the payment for service credit under this
174	174	section not later than the 90th day after the date the retirement
175	175	system issues a cost statement for the purchase of service credit
176	176	under this section. The retirement system may grant a member a
177	177	one-time extension of not more than 30 days to complete the purchase
178	178	of the service credit if the purchase is made by:
179	179	(1) a direct rollover distribution from another
180	180	eligible retirement plan; or
181	181	(2) a direct trustee-to-trustee transfer from:
182	182	(A) an eligible deferred compensation plan
183	183	described by Section 457(b), Internal Revenue Code of 1986; or
184	184	(B) an individual account plan consisting of an
185	185	annuity contract described by Section 403(b), Internal Revenue Code
186	186	of 1986.
187	187	(d-1) A member who fails to make the payment described by
188	188	Subsection (d) within the time prescribed by that subsection may:
189	189	(1) decline to purchase service credit under this
190	190	section and maintain the member's effective date of retirement; or
191	191	(2) revoke the member's retirement as provided by
192	192	Section 824.005(a) and select a later retirement date that provides
193	193	the member with sufficient time to complete the purchase of the
194	194	service credit under this section.
195	195	SECTION 6. Sections 824.002(e) and (f), Government Code,
196	196	are amended to read as follows:
197	197	(e) Except as provided by Section 823.403(d), if
198	198	applicable, not [Not] later than two months after the later of a
199	199	member's retirement date or the last day of the month in which the
200	200	member's application for retirement is submitted, and before the
201	201	later of the due date for the first monthly annuity payment or the
202	202	date on which the retirement system issues the first monthly
203	203	annuity payment, a member applying for service retirement may,
204	204	after providing notice to the retirement system, reinstate
205	205	withdrawn contributions, make deposits for military service and
206	206	equivalent membership service, and receive service credit as
207	207	provided by this subtitle.
208	208	(f) An effective retirement date may not be changed after it
209	209	is established except by revocation of retirement under Section
210	210	824.005 [and retirement at a later date].
211	211	SECTION 7. Section 825.307(a), Government Code, is amended
212	212	to read as follows:
213	213	(a) The retirement system shall deposit in a member's
214	214	individual account in the member savings account:
215	215	(1) the amount of contributions to the retirement
216	216	system that is deducted from the member's compensation;
217	217	(2) the portion of a deposit made on or after
218	218	resumption of membership that represents the amount of retirement
219	219	benefits received;
220	220	(3) the portion of a deposit to reinstate service
221	221	credit previously canceled that represents the amount withdrawn or
222	222	refunded;
223	223	(4) the portion of a deposit to establish military
224	224	service credit required by Section 823.302(c);
225	225	(5) the portion of a deposit to establish USERRA
226	226	credit required by Section 823.304(c);
227	227	(6) the portion of a deposit to establish:
228	228	(A) equivalent membership service credit
229	229	required by Section 823.401(d), 823.402(e) [823.402(e)(1) or
230	230	(e)(2)], 823.403(d), [or] 823.404(c), or 823.406(b) or former
231	231	Section 823.405; or
232	232	(B) unreported service credit or compensation
233	233	required by Section 825.403(h); and
234	234	(7) [(6)] interest earned on money in the account as
235	235	provided by Subsections (b) and (c) and Section 825.313(c).
236	236	SECTION 8. Section 825.509(b-1), Government Code, is
237	237	amended to read as follows:
238	238	(b-1) Notwithstanding Subsection (b)(3), with respect to a
239	239	distribution made on or after January 1, 2002, an otherwise
240	240	eligible portion of a rollover distribution that consists of
241	241	after-tax employee contributions not includable in gross income is
242	242	an eligible rollover distribution for purposes of this section. The
243	243	eligible portion may be transferred only:
244	244	(1) to an individual retirement account or annuity
245	245	described by Section 408(a) or (b), Internal Revenue Code of 1986;
246	246	(2) to a qualified plan described by Section 403(a),
247	247	Internal Revenue Code of 1986;
248	248	(3) for distributions occurring on or after January 1,
249	249	2007, to a qualified plan described by Section 401(a), Internal
250	250	Revenue Code of 1986, if the plan separately accounts for:
251	251	(A) the amounts transferred and the earnings on
252	252	the amounts transferred; and
253	253	(B) the portion of the distribution that is
254	254	includable in gross income and the portion of the distribution that
255	255	is not includable in gross income; or
256	256	(4) to an annuity contract described by Section
257	257	403(b), Internal Revenue Code of 1986, that agrees to separately
258	258	account for amounts transferred and earnings on amounts
259	259	transferred, including for the portion of the distribution that is
260	260	includable in gross income and the portion of the distribution that
261	261	is not includable in gross income.
262	262	SECTION 9. Section 830.201(h), Government Code, is amended
263	263	to read as follows:
264	264	(h) Before November 2 of each even-numbered year, the Texas
265	265	Higher Education Coordinating Board [board of trustees], in
266	266	coordination with the Legislative Budget Board, shall certify to
267	267	the comptroller for review and adoption an estimate of the amount
268	268	necessary to pay the state's contributions to the retirement system
269	269	for the following biennium. For qualifying employees under
270	270	Subsection (g)(1), the Texas Higher Education Coordinating Board
271	271	[board of trustees] shall include only the amount payable by the
272	272	state under Subsection (g)(1) in determining the amount to be
273	273	certified.
274	274	SECTION 10. This Act takes effect September 1, 2017.