| 1 | 1 | | 87R7542 JCG-D |
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| 2 | 2 | | By: Frank H.B. No. 2936 |
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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 an optional service retirement annuity of the Employees |
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| 8 | 8 | | Retirement System of Texas. |
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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 814, Government Code, is |
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| 11 | 11 | | amended by adding Section 814.109 to read as follows: |
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| 12 | 12 | | Sec. 814.109. COST-OF-LIVING ADJUSTMENTS OPTION. (a) A |
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| 13 | 13 | | member who is eligible for an unreduced service retirement annuity |
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| 14 | 14 | | may select a standard retirement annuity or an optional service |
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| 15 | 15 | | retirement annuity described by Section 814.108 together with the |
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| 16 | 16 | | option for cost-of-living adjustments as described by this section. |
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| 17 | 17 | | (b) The retirement system shall provide the cost-of-living |
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| 18 | 18 | | adjustments by reducing benefits for an appropriate period |
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| 19 | 19 | | beginning immediately after the member's retirement and |
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| 20 | 20 | | periodically increasing the amount of the benefits, as determined |
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| 21 | 21 | | by the system, during the period the member or designated |
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| 22 | 22 | | beneficiary is entitled to service retirement benefits. |
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| 23 | 23 | | (c) The service retirement annuity selected by the member |
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| 24 | 24 | | must be calculated to reflect the cost-of-living adjustments to be |
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| 25 | 25 | | provided under this section and be actuarially equivalent to a |
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| 26 | 26 | | standard or optional service retirement annuity, as applicable. |
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| 27 | 27 | | The annuity and adjustments must be computed to result in no |
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| 28 | 28 | | actuarial loss to the retirement system. |
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| 29 | 29 | | (d) The cost-of-living adjustments option under this |
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| 30 | 30 | | section may be elected only once by a member and may not be elected |
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| 31 | 31 | | by a retiree. A member retiring under the proportionate retirement |
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| 32 | 32 | | program under Chapter 803 is not eligible for the partial lump-sum |
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| 33 | 33 | | option. |
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| 34 | 34 | | (e) This section does not apply to a disability retirement |
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| 35 | 35 | | annuity. |
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| 36 | 36 | | (f) Before a retiring member selects the cost-of-living |
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| 37 | 37 | | adjustments option under this section, the retirement system must |
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| 38 | 38 | | provide a written notice to the member of the amount by which the |
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| 39 | 39 | | member's annuity will be reduced and the period of the reduction |
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| 40 | 40 | | because of that selection. The retirement system shall maintain a |
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| 41 | 41 | | copy of the notice under this subsection signed by the member. |
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| 42 | 42 | | (g) The board of trustees may adopt rules for the |
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| 43 | 43 | | implementation of this section. |
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| 44 | 44 | | SECTION 2. Section 814.109, Government Code, as added by |
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| 45 | 45 | | this Act, applies only to a retirement that occurs on or after |
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| 46 | 46 | | January 1, 2022. |
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| 47 | 47 | | SECTION 3. This Act takes effect September 1, 2021. |
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