89R22082 RDR-D
By: Lambert H.B. No. 3474
Substitute the following for H.B. No. 3474:
By: Plesa C.S.H.B. No. 3474
A BILL TO BE ENTITLED
AN ACT
relating to the evaluation and reporting of investment practices
and performance of certain public retirement systems.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 802.109, Government Code, is amended by
amending Subsections (d), (e), (e-1), (f), and (g) and adding
Subsections (d-1), (d-2), and (j) to read as follows:
(d) In accordance with a schedule of deadlines prescribed by
the board and except as provided by Subsection (e), a [A] public
retirement system shall conduct an [the] evaluation under
[described by] Subsection (a):
(1) once every three years, if the total assets of the
retirement system as of the date [last day] of the preceding
evaluation [fiscal year] were at least $100 million; or
(2) subject to Subsection (d-1), once every six years,
if the total assets of the retirement system as of the date [last
day] of the preceding evaluation [fiscal year] were at least $30
million and less than $100 million.
(d-1) If a public retirement system is conducting
evaluations every six years as required by Subsection (d)(2) and
the system's total pension liability increases to at least $100
million during a fiscal year, the system shall complete the next
evaluation under Subsection (a) by the next appropriate deadline,
as determined by the board, under the evaluation schedule.
(d-2) Subject to Subsection (d-1) and except as provided by
Subsection (e), a public retirement system subject to an evaluation
requirement under Subsection (d)(1) or (2) remains subject to that
same requirement unless both the total assets and the total pension
liability of the system decrease to an amount that is below the
minimum amount prescribed by the applicable requirement.
(e) A public retirement system is not required to conduct an
[the] evaluation under [described by] Subsection (a) if the total
assets of the retirement system were less than $30 million as of the
last day of the [preceding] fiscal year immediately preceding the
next evaluation deadline under the evaluation schedule [were less
than $30 million].
(e-1) An [Not later than the 30th day after the date an]
independent firm that completes an evaluation described by
Subsection (a)[, the independent firm] shall:
(1) submit to the public retirement system for
purposes of discussion and clarification a substantially completed
[preliminary] draft of the evaluation report; and
(2) request in writing that the system[, on or before
the 30th day after the date the system receives the preliminary
draft,] submit to the firm:
(A) a description of any action taken or expected
to be taken in response to a recommendation made in the evaluation;
and
(B) any written response of the system that the
system wants to accompany the final evaluation report.
(f) The independent firm shall file the final evaluation
report, including the evaluation results and any response received
from the public retirement system, with the governing body of the
system[:
[(1) not earlier than the 31st day after the date on
which the preliminary draft is submitted to the system; and
[(2) not later than the later of:
[(A) the 60th day after the date on which the
preliminary draft is submitted to the system; or
[(B) May 1 in the year following the year in which
the system is evaluated under Subsection (a)].
(g) The [Not later than the 31st day after the date the]
governing body of a public retirement system that receives a report
of an evaluation under this section[, the governing body] shall
submit the report to the board.
(j) In this section:
(1) "Evaluation schedule" means the schedule of
deadlines prescribed by the board under Subsection (d).
(2) "Total pension liability" means the portion of the
present value of projected retirement benefit payments to be
provided through the retirement system to active and inactive
members that is attributable to those members' past periods of
service, in compliance with Statement No. 68 of the Governmental
Accounting Standards Board.
SECTION 2. Not later than January 1, 2026, the State Pension
Review Board shall develop the schedule of deadlines required by
Section 802.109(d), Government Code, as amended by this Act.
SECTION 3. This Act takes effect September 1, 2025.