Office of House Bill AnalysisS.B. 523
By: Armbrister
Pensions & Investments


The Texas County and District Retirement System is a voluntary statewide
retirement system that administers retirement, disability, and death
benefits to officers and employees of counties and other political
subdivisions, excluding cities and school districts.  Each participating
subdivision is separately funded, with both employers and employees making
contributions to TCDRS.  Senate Bill 523 provides improved options to
members and retirees of TCDRS, including increased death benefits, and
improved options for disability retirees and retirees who have worked for
more than one subdivision or who return to work.  S.B. 523 also makes
administrative changes to streamline the system.   


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
office, department, agency, or institution.   


Senate Bill 523 amends the Government Code to modify provisions relating to
participation and credit in, contributions to, and benefits and
administration of the Texas County and District Retirement System (TCDRS).

The bill modifies provisions regarding the applications by, and payments
to, persons other than  members, beneficiaries, and annuitants (Sec.
841.008).  The bill authorizes the board to adopt rules relating to the
selection, payment, and distribution of benefits to ensure compliance with
federal statutes and regulations (Sec. 841.010).  A person commits an
offense if the person knowingly fails to return money received from the
retirement system to which the person is not entitled (Sec. 841.101).   

The bill authorizes the board to adopt rules regarding the powers and
duties of a participating subdivision to adopt orders and resolutions, make
elections, and otherwise exercise decision-making authority concerning the
rights and benefits of the members and annuitants under a plan adopted or
assumed by the subdivision (Sec. 842.002).  The bill modifies provisions
regarding the service credit of a member of multiple retirement systems
that may be used to determine eligibility for a benefit in TCDRS (Sec.
842.106). The bill removes certain provisions regarding exceptions to the
general membership requirement in the retirement system and modifies
provisions for the withdrawal of accumulated contributions (Secs. 842.107
and 842.108).  The bill also modifies provisions regarding a person's
length of membership and the termination of membership in TCDRS (Sec.
842.109).  The bill modifies the provisions regarding the resumption of
service by a retiree with the same employer or a different employer (Secs.
842.110 and 842.111).   

The bill expands the provisions regarding correction of errors to grant an
employee service credit based on back pay or employment gained by the
issuance of a judgment or order or the settlement of a suit (Sec. 842.112).

 The bill provides that the monthly amount of a standard retirement annuity
is based on the sum of the member's service credit and accumulated
contributions and is computed using the member's attained age and the
actuarial equivalent of the benefit (Sec. 843.002).  The bill sets forth
provisions regarding the composition of service credit and the adjustment
of credited service and current service credit (Secs. 843.004 and 843.005).

The bill requires a member to claim prior service credit before the fifth
anniversary of the date the member became eligible to claim the credit
(Sec. 843.103).  The bill removes limitations on allocated prior service
credit (Sec. 843.105).  The bill modifies provisions relating to the
certification of service and average compensation for a member of an
optimal class who claims credit for prior service (Sec. 843.304).   

The bill expands the types of benefits payable by the retirement system to
include supplemental death benefits and refunds of accumulated
contributions (Sec. 844.001).  The bill provides that a separate retirement
annuity is payable for each participating subdivision from which a person
retires or is considered to have retired (Sec. 844.002).  A person who has
retired with a service retirement annuity is eligible, without regard to
any age or credited service requirement, to apply for and receive a service
retirement annuity based on service for another participating subdivision
from which the person has terminated employment (Sec. 844.102).  The bill
modifies provisions regarding the effective date of a member's retirement.
The bill authorizes credited service with a member's new employer to be
used in determining eligibility for service retirement.  The bill provides
that a member eligible for service retirement using combined credit service
for two or more subdivisions may apply simultaneously for a retirement
annuity from one subdivision and a refund of accumulated contributions for
service to another subdivision (Sec. 844.003).  The bill specifies the last
day a retiree is authorized to revoke or change an application for
retirement and other circumstances under which annuity payments may be
changed (Sec. 844.005).  

The bill provides that an optional service retirement annuity or an
optional disability retirement annuity reverts to the standard service
retirement annuity if the designated beneficiary predeceases the retiree
(Secs. 844.104 and 844.305).  The bill modifies provisions regarding
payments under a qualified domestic relations order (Sec. 844.006).  The
bill modifies the partial lump-sum distribution service retirement
provisions (Sec. 844.009).  The bill provides that a member files an
application for service or disability retirement annuity with the
retirement system rather than the board of trustees (Secs. 844.101 and

This bill sets forth provisions regarding annuities that are not subject to
discontinuance (Sec. 844.3051). The bill modifies the adjustments that may
be made at the discontinuance of a disability retirement annuity when a
person resumes membership in TCDRS, and authorizes the board to adopt rules
regarding the computation of those adjustments (Sec. 844.309).   

The bill modifies provisions regarding return of accumulated contributions
and return of excess contributions after the death of a member or former
member (Secs. 844.401 and 844.402).  The bill provides that the
supplemental death benefit program constitutes group term life insurance
purchased for employees as described by the federal Internal Revenue Code
of 1986 (Sec. 844.501).  The bill modifies the computations used to
determine the amount of a member's supplemental death benefit annuity (Sec.
844.503).  The bill increases from $2,500 to $5,000 the supplemental death
benefit of a retiree of one subdivision (Sec. 844.504).  The bill modifies
the benefit options the governing body of a subdivision may adopt or
authorize (Sec. 844.704).   

The retirement system is required to establish and maintain a separate
member individual account for each subdivision with which a member has
credited service (Sec. 845.306).  The bill requires payments to be made by
electronic funds transfer, and sets forth provisions for exceptions ( Sec.
845.313).  The bill modifies provisions regarding penalties for late
contributions by subdivisions (Sec. 845.407).  The bill modifies provisions
regarding unclaimed benefits (Sec. 845.505).   

The bill repeals laws relating to a member from a county with a local
pension system, partial lump-sum distribution on service retirement,
optional service retirement annuity, optional disability retirement
annuity,  excess contributions of disability retirees, and extended
supplemental death benefits coverage (SECTION 54).   


December 31, 2001.  SECTIONS 12 and 51 of the Act take effect September 1,