HBA-TBM H.B. 3407 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 3407
By: King, Tracy
Pensions & Investments
3/23/2001
Introduced



BACKGROUND AND PURPOSE 

Currently, a public school employee who is a member of the Teacher
Retirement System of Texas (TRS) is allowed to establish service credit in
TRS for military service, out-of-state service, developmental leave,
service previously waived, and work experience in a career or technological
field.  Teachers are not authorized to establish service credit that is
required by a court order due to wrongful termination by a school district.
House Bill 3407 authorizes a teacher to establish court-ordered service
credit in TRS.   

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

House Bill 3407 amends the Government Code to set forth provisions
regarding court-ordered credit in the Teacher Retirement System of Texas
(TRS).  The bill defines a "court order" as a court order that finds that a
school district wrongfully terminated a member, requires the school
district to reemploy the member, and requires the establishment of credit
in TRS for all or part of the service credit the member would have
otherwise established during the period between the date of the wrongful
termination and the date of reemployment.   

The bill authorizes an eligible member to establish equivalent membership
service credit for credit required by a court order.  A member is eligible
to establish credit if the member has at least 10 years of service credit
in TRS for actual service in public schools, at least one year of which is
for service performed after the period for which credit is sought.   

The bill authorizes a member to establish credit by depositing with TRS for
each year of service claimed a contribution computed at the rate of 12
percent of the full-time rate of the member's annual compensation during
the first year of service for which the member received membership credit
in TRS that is after the period for which credit is sought.  In addition to
the contribution, a member must pay a fee of eight percent, compounded
annually, of the required contribution from the date of first eligibility
to the date of deposit. A deposit for at least one year of credit,
including the fee, must be made with an initial application for credit, and
all payments for credit claimed must be made before retirement.  The amount
of service credit a member is authorized to establish is prohibited from
exceeding two years.  After a member makes the required deposits, TRS is
required to grant the member one year of equivalent membership service
credit for each year of credit required under the court order.  The bill
prohibits TRS from using service credit granted by order in computing a
member's annual average compensation.   

The bill requires all court-ordered credit to be computed on a September 1
through August 31 school year.  



 EFFECTIVE DATE

September 1, 2001.