| 1 | 1 | | 85R14848 KFF-F |
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| 2 | 2 | | By: Taylor of Collin S.B. No. 2009 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to requiring a supplemental actuarial analysis by certain |
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| 8 | 8 | | public retirement systems. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Subchapter B, Chapter 802, Government Code, is |
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| 11 | 11 | | amended by adding Section 802.109 to read as follows: |
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| 12 | 12 | | Sec. 802.109. SUPPLEMENTAL ACTUARIAL ANALYSIS ASSUMING |
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| 13 | 13 | | CERTAIN RATES OF RETURN BY PUBLIC RETIREMENT SYSTEMS; REPORT. (a) |
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| 14 | 14 | | In this section, "assumed rate of return" means the expected |
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| 15 | 15 | | long-term rate of return on the investment of public retirement |
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| 16 | 16 | | system assets. |
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| 17 | 17 | | (b) Each public retirement system shall submit to the board |
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| 18 | 18 | | a supplemental analysis prepared in conjunction with the system's |
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| 19 | 19 | | actuarial valuation that performs a 30-year forward-looking |
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| 20 | 20 | | projection of system assets and liabilities using the following |
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| 21 | 21 | | assumptions: |
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| 22 | 22 | | (1) annual investment returns for the full 30-year |
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| 23 | 23 | | period equal to the assumed rate of return used in the system's |
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| 24 | 24 | | actuarial valuation; |
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| 25 | 25 | | (2) annual investment returns for the: |
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| 26 | 26 | | (A) first 20-year period equal to the assumed |
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| 27 | 27 | | rate of return used in the system's actuarial valuation less 300 |
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| 28 | 28 | | basis points; and |
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| 29 | 29 | | (B) final 10-year period equal to the assumed |
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| 30 | 30 | | rate of return used in the system's actuarial valuation; and |
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| 31 | 31 | | (3) annual investment returns for the: |
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| 32 | 32 | | (A) first 20-year period equal to the assumed |
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| 33 | 33 | | rate of return used in the system's actuarial valuation plus 300 |
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| 34 | 34 | | basis points; and |
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| 35 | 35 | | (B) final 10-year period equal to the assumed |
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| 36 | 36 | | rate of return used in the system's actuarial valuation. |
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| 37 | 37 | | (c) The board shall adopt rules necessary to implement this |
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| 38 | 38 | | section, including rules regarding the level of detail that must be |
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| 39 | 39 | | included in analyses required under Subsection (b). |
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| 40 | 40 | | (d) The board shall annually compile the analyses described |
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| 41 | 41 | | by Subsection (b) in a report and submit the report to the governor, |
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| 42 | 42 | | lieutenant governor, speaker of the house of representatives, and |
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| 43 | 43 | | members of the legislature. The report required by this subsection |
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| 44 | 44 | | may be combined with any other report required by this chapter or |
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| 45 | 45 | | other law. |
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| 46 | 46 | | SECTION 2. This Act takes effect September 1, 2017. |
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