By: Frank H.B. No. 1393
A BILL TO BE ENTITLED
AN ACT
relating to an optional service retirement annuity of the Employees
Retirement System of Texas.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 814, Government Code, is
amended by adding Section 814.109 to read as follows:
Sec. 814.109. COST-OF-LIVING ADJUSTMENTS OPTION. (a) A
member who is eligible for an unreduced service retirement annuity
may select a standard retirement annuity or an optional service
retirement annuity described by Section 814.108 together with the
option for cost-of-living adjustments as described by this section.
(b) The retirement system shall provide the cost-of-living
adjustments by reducing benefits for an appropriate period
beginning immediately after the member's retirement and
periodically increasing the amount of the benefits, as determined
by the system, during the period the member or designated
beneficiary is entitled to service retirement benefits.
(c) The service retirement annuity selected by the member
must be calculated to reflect the cost-of-living adjustments to be
provided under this section and be actuarially equivalent to a
standard or optional service retirement annuity, as applicable.
The annuity and adjustments must be computed to result in no
actuarial loss to the retirement system.
(d) The cost-of-living adjustments option under this
section may be elected only once by a member and may not be elected
by a retiree. A member retiring under the proportionate retirement
program under Chapter 803 is not eligible for the partial lump-sum
option.
(e) This section does not apply to a disability retirement
annuity.
(f) Before a retiring member selects the cost-of-living
adjustments option under this section, the retirement system must
provide a written notice to the member of the amount by which the
member's annuity will be reduced and the period of the reduction
because of that selection. The retirement system shall maintain a
copy of the notice under this subsection signed by the member.
(g) The board of trustees may adopt rules for the
implementation of this section.
SECTION 2. Section 814.109, Government Code, as added by
this Act, applies only to a retirement that occurs on or after
January 1, 2022.
SECTION 3. This Act takes effect September 1, 2023.