Texas 2021 - 87th Regular

Texas House Bill HB4163 Compare Versions

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

Old	New	Differences
1	1	87R7543 JCG-D
2	2	By: Longoria H.B. No. 4163
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to a funding soundness restoration plan for certain public
8	8	retirement systems.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 28(h), Texas Local Fire Fighters
11	11	Retirement Act (Article 6243e, Vernon's Texas Civil Statutes), is
12	12	amended to read as follows:
13	13	(h) A retirement system established under this Act is exempt
14	14	from Subchapter C, Chapter 802, Government Code, except Sections
15	15	802.2017, 802.202, 802.205, and 802.207.
16	16	SECTION 2. Section 802.2015(b), Government Code, is amended
17	17	to read as follows:
18	18	(b) This section applies to a public retirement system and
19	19	its associated governmental entity other than a public retirement
20	20	system and its associated governmental entity subject to Section
21	21	802.2016 or 802.2017.
22	22	SECTION 3. Subchapter C, Chapter 802, Government Code, is
23	23	amended by adding Section 802.2017 to read as follows:
24	24	Sec. 802.2017. FUNDING SOUNDNESS RESTORATION PLAN FOR
25	25	CERTAIN PUBLIC RETIREMENT SYSTEMS FOR FIRE FIGHTERS. (a) In this
26	26	section:
27	27	(1) "Funded ratio" has the meaning assigned by Section
28	28	802.2011.
29	29	(2) "Governmental entity" has the meaning assigned by
30	30	Section 802.1012.
31	31	(b) This section applies only to a public retirement system
32	32	governed by the Texas Local Fire Fighters Retirement Act (Article
33	33	6243e, Vernon's Texas Civil Statutes), and its associated
34	34	governmental entity.
35	35	(c) A public retirement system shall notify the associated
36	36	governmental entity in writing if the system receives an actuarial
37	37	valuation indicating that the system's actual contributions are not
38	38	sufficient to amortize the unfunded actuarial accrued liability
39	39	within 30 years. The governing body of the public retirement system
40	40	and the governing body of the associated government entity shall
41	41	jointly formulate a funding soundness restoration plan under
42	42	Subsection (e) if:
43	43	(1) the system's actuarial valuation shows that the
44	44	system's amortization period exceeds:
45	45	(A) 40 years; or
46	46	(B) 30 years and:
47	47	(i) the funded ratio of the system is less
48	48	than 65 percent; or
49	49	(ii) the funded ratio of the system is 65
50	50	percent or greater and the system receives:
51	51	(a) if the system receives an annual
52	52	actuarial valuation, two more consecutive actuarial valuations
53	53	that show the funded ratio of the system is 65 percent or greater;
54	54	or
55	55	(b) if the system receives actuarial
56	56	valuations every two or three years, one more consecutive actuarial
57	57	valuation that shows the funded ratio of the system is 65 percent or
58	58	greater;
59	59	(2) except as provided by Subsection (d), a funding
60	60	soundness restoration plan formulated under Subsection (e) or
61	61	Section 802.2015 is not already in effect; and
62	62	(3) the board has not exempted the system from the
63	63	requirement to formulate a funding soundness restoration plan in
64	64	accordance with the rules adopted under Subsection (h).
65	65	(d) The governing body of a public retirement system and the
66	66	associated governmental entity that have formulated a funding
67	67	soundness restoration plan under Subsection (e) shall formulate a
68	68	revised funding soundness restoration plan under that subsection
69	69	if, based on the most recent actuarial valuation, the board
70	70	determines that the previously formulated funding soundness
71	71	restoration plan has not been adhered to.
72	72	(e) A funding soundness restoration plan formulated under
73	73	this section must:
74	74	(1) be developed by the public retirement system and
75	75	the associated governmental entity in accordance with the system's
76	76	governing statute; and
77	77	(2) be designed to achieve a contribution rate that
78	78	will be sufficient to amortize the unfunded actuarial accrued
79	79	liability within 30 years not later than the 10th anniversary of the
80	80	date on which the final version of a funding soundness restoration
81	81	plan is agreed to.
82	82	(f) A public retirement system and the associated
83	83	governmental entity that formulate a funding soundness restoration
84	84	plan shall report any updates of progress made by the entities
85	85	toward improved actuarial soundness to the board every two years.
86	86	(g) Each public retirement system that formulates a funding
87	87	soundness restoration plan as provided by this section shall submit
88	88	a copy of that plan to the board and any change to the plan not later
89	89	than the 31st day after the date on which the plan or the change is
90	90	agreed to.
91	91	(h) The board shall adopt rules for the administration of
92	92	this section, including a procedure for a public retirement system
93	93	subject to the requirement to formulate a funding soundness
94	94	restoration plan under this section to request from the board an
95	95	exemption from the requirement based on:
96	96	(1) the system's adoption of actuarially determined
97	97	contribution rates; and
98	98	(2) one or more actuarial valuations of the system
99	99	showing the system's amortization period is projected to become
100	100	within a reasonable period an amortization period not exceeding 30
101	101	years.
102	102	SECTION 4. As soon as practicable after the effective date
103	103	of this Act, the State Pension Review Board shall adopt the rules
104	104	required by Section 802.2017(h), Government Code, as added by this
105	105	Act.
106	106	SECTION 5. A public retirement system is not required to
107	107	formulate a funding soundness restoration plan under Section
108	108	802.2017, Government Code, as added by this Act, based on an
109	109	actuarial valuation made before the effective date of this Act.
110	110	SECTION 6. This Act takes effect September 1, 2021.