H.B. No. 2829

	AN ACT
	relating to participation in and benefits and administration of
	retirement systems for firefighters in certain municipalities.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 1.02, Chapter 183 (S.B. 598), Acts of the
	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
	Texas Civil Statutes), is amended by adding Subdivision (13) to
	read as follows:
	(13)  "Spouse" means an individual to whom a member is
	legally married under Subtitle A, Title 1, Family Code, or a
	comparable law of another jurisdiction, provided that, in the case
	of an informal marriage in this state, the marriage must be
	evidenced by a declaration of informal marriage recorded in
	accordance with Subchapter E, Chapter 2, Family Code.
	SECTION 2.  Section 2.03(c), Chapter 183 (S.B. 598), Acts of
	the 64th Legislature, Regular Session, 1975 (Article 6243e.1,
	Vernon's Texas Civil Statutes), is amended to read as follows:
	(c)  Each election is by secret written ballot on a date the
	board of trustees determines. Only persons who have been nominated
	may be listed on the written ballot. Nominations may be made in
	person, by mail, or by telephone to the office of the fund and must
	be received between September [October] 1 and September [October]
	15.
	SECTION 3.  Section 2.11, Chapter 183 (S.B. 598), Acts of the
	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
	Texas Civil Statutes), is amended to read as follows:
	Sec. 2.11.  RULEMAKING. The board of trustees shall adopt
	rules and perform reasonable activities it considers necessary or
	desirable for the efficient administration of the fund and to
	maintain the qualified status of the fund under Section 401(a) of
	the Internal Revenue Code.
	SECTION 4.  Article 2, Chapter 183 (S.B. 598), Acts of the
	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
	Texas Civil Statutes), is amended by adding Section 2.13 to read as
	follows:
	Sec. 2.13.  CONFIDENTIALITY OF INFORMATION ABOUT MEMBERS,
	RETIREES, ANNUITANTS, OR BENEFICIARIES. (a) Information contained
	in records in the custody of the fund concerning an individual
	member, retiree, annuitant, or beneficiary is confidential under
	Section 552.101, Government Code, and may not be disclosed in a form
	identifiable with a specific individual unless:
	(1)  the information is disclosed to:
	(A)  the individual or the individual's attorney,
	guardian, executor, administrator, conservator, or other person
	who the administrator of the fund determines is acting in the
	interest of the individual or the individual's estate;
	(B)  a spouse or former spouse of the individual
	after the administrator of the fund determines that the information
	is relevant to the spouse's or former spouse's interest in member
	accounts, benefits, or other amounts payable by the fund;
	(C)  a governmental official or employee after the
	administrator of the fund determines that disclosure of the
	information requested is reasonably necessary to the performance of
	the duties of the official or employee; or
	(D)  a person authorized by the individual in
	writing to receive the information; or
	(2)  the information is disclosed pursuant to a
	subpoena and the administrator of the fund determines that the
	individual will have a reasonable opportunity to contest the
	subpoena.
	(b)  This section does not prevent the disclosure of the
	status or identity of an individual as a member, former member,
	retiree, deceased member or retiree, or beneficiary of the fund.
	(c)  A determination and disclosure under Subsection (a) may
	be made without notice to the individual member, retiree,
	annuitant, or beneficiary.
	SECTION 5.  Section 5.04, Chapter 183 (S.B. 598), Acts of the
	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
	Texas Civil Statutes), is amended by amending Subsection (b) and
	adding Subsection (b-1) to read as follows:
	(b)  The three percent factor used in this section may be
	changed to some other percent if the change:
	(1)  is first approved by the board's actuary;
	(2)  is approved by the board of trustees;
	(3)  applies [only] to one or any combination of the
	following groups:
	(A)  firefighters who are employed on an active,
	full-time basis in the fire department at the time of the change;
	(B)  firefighters who begin service with the fire
	department after the change becomes effective; and
	(C)  members who retire under Section 5.06 of this
	Act after the change becomes effective; and
	(4)  does not reduce a member's benefit for service
	credit accumulated before the date of the change.
	(b-1)  In determining whether to approve an increase in the
	factor under Subsection (b) of this section, the board's actuary
	shall take into consideration whether the fund has reserves
	sufficient to enable the payment of a cost-of-living adjustment
	under Section 9.04(a) of this Act to all current members and
	survivors at a level that is equal to the average percentage
	increase in the Consumer Price Index for All Urban Consumers as
	determined by the United States Department of Labor for the 10
	annual periods preceding the proposed effective date of the change.
	SECTION 6.  Section 7.02, Chapter 183 (S.B. 598), Acts of the
	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
	Texas Civil Statutes), is amended to read as follows:
	Sec. 7.02.  SURVIVING SPOUSE OF RETIREE. (a) On the death of
	a retiree, the retiree's surviving spouse is entitled to receive an
	immediate monthly benefit from the fund of 75 percent of the
	retirement benefit that was being paid to the retiree if the spouse:
	(1)  was married to the retiree at the time of the
	retiree's retirement; or
	(2)  married the retiree after the retiree's retirement
	and was married to the retiree for at least 24 consecutive months.
	(b)  For purposes of Subsection (a)(1) of this section, with
	respect to an informal marriage established in this state, a
	surviving spouse is considered married to a retiree as of the date a
	declaration of informal marriage was recorded in accordance with
	Subchapter E, Chapter 2, Family Code.
	SECTION 7.  Section 9.04, Chapter 183 (S.B. 598), Acts of the
	64th Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
	Texas Civil Statutes), is amended by amending Subsections (a) and
	(b) and adding Subsections (a-1), (a-2), (a-3), (a-4), and (b-1) to
	read as follows:
	(a)  Subject to this section and except [Except] as provided
	by Section 5.05 of this Act, a person receiving a retirement or
	survivor's benefit under this Act is entitled each calendar year to
	a [an annual] cost-of-living adjustment of that person's benefit
	calculated in accordance with this section.
	(a-1)  The annual cost-of-living adjustment under this
	section:
	(1)  is based on the collective adjustment amount
	calculated in accordance with Subsection (a-2) of this section and
	allocated among persons eligible for an adjustment under this
	section in a manner and in an amount determined by the board of
	trustees;
	(2)  may take effect at any time during a given calendar
	year, as determined by the board of trustees; and
	(3)  may not reduce a person's benefit to an amount less
	than the person received when the benefit first was paid to that
	person.
	(a-2)  The collective adjustment amount described by
	Subsection (a-1) of this section:
	(1)  is an amount equal to the actuarial value, as
	determined by the board's actuary based on the interest and
	mortality assumptions adopted by the board of trustees for the most
	recent actuarial valuation of the fund, of the percentage [any]
	increase in the Consumer Price Index for All Urban Consumers as
	determined by the United States Department of Labor for the
	applicable determination period immediately preceding the date the
	cost-of-living adjustment is to take effect, multiplied by the
	total amount of benefits payable in the month immediately preceding
	the date an adjustment is to take effect to persons who are eligible
	to receive an adjustment under this section; and
	(2)  if applicable:
	(A)  is reduced by an amount that the board's
	actuary determines is necessary to maintain the financial stability
	of the fund; or
	(B)  is increased in accordance with Subsection
	(b) of this section.
	(a-3)  For purposes of Subsection (a-2) of this section, the
	applicable determination period is the shorter of:
	(1)  12 months; or
	(2)  the period since the last adjustment [increase in
	benefits] under this section.
	(a-4)  In determining whether to reduce the collective
	adjustment amount under Subsection (a-2) of this section, the
	board's actuary may not take into consideration the cost of future
	adjustments under this section.
	(b)  The board of trustees may increase the collective [If
	an] adjustment amount under Subsection (a-2) [(a)] of this section
	if:
	(1)  [would exceed one percent of a person's benefit,
	the portion of the adjustment that exceeds one percent of the
	benefit may not be made under this section unless] the board's
	actuary has advised the board of trustees that the increase
	[adjustment] would not impair the financial stability of the fund;
	and
	(2)  the increase [adjustment] has been approved by the
	affirmative vote of a majority of the board of trustees. [If an
	adjustment under Subsection (a) of this section would be one
	percent or less of a person's benefit, the adjustment may not be
	made under this section unless the board's actuary has advised the
	board of trustees that the adjustment would not impair the
	financial stability of the fund.]
	(b-1)  In determining whether an adjustment would impair the
	financial stability of the fund under Subsection (b) of this
	section, the board's actuary shall take into consideration the cost
	of future adjustments under this section.
	SECTION 8.  Section 11.01, Chapter 183 (S.B. 598), Acts of
	the 64th Legislature, Regular Session, 1975 (Article 6243e.1,
	Vernon's Texas Civil Statutes), is amended to read as follows:
	Sec. 11.01.  INVESTMENTS. The board of trustees in its sole
	discretion may invest, reinvest, or change the assets of the fund.
	The board of trustees shall invest the funds in whatever
	instruments or investments the board considers prudent. In making
	investments for the fund, the board of trustees shall discharge its
	duties with the care, skill, prudence, and diligence under the
	circumstances then prevailing that a prudent person acting in a
	similar capacity and familiar with such matters would use in the
	conduct of an enterprise of a similar character and with similar
	aims. [PERMITTED INVESTMENTS. When the board of trustees
	determines that there is in the fund a surplus exceeding the
	reasonable, safe amount necessary to take care of the current
	demands on the fund, the surplus, or so much of it as the board of
	trustees considers prudent, may be invested in:
	[(1)     direct obligations of or obligations the
	principal and interest of which are guaranteed by the United States
	or its agencies or instrumentalities;
	[(2)     short-term investment funds, mutual funds, or
	their equivalent that are rated as investment quality or higher by a
	nationally recognized investment rating firm;
	[(3)     fully collateralized or direct repurchase
	agreements, including direct and reverse security repurchase
	agreements and security lending agreements that:
	[(A)  have a defined termination date;
	[(B)     are secured by obligations described by this
	section or by cash; and
	[(C)     are pledged with a third party selected or
	approved by a majority vote of the board of trustees;
	[(4)     corporate bonds, including convertible bonds,
	collateralized mortgage obligations, and asset-backed securities,
	rated as investment quality or higher by a nationally recognized
	investment rating firm;
	[(5)     common stocks, preferred stocks, and convertible
	preferred stocks of companies incorporated in the United States and
	foreign stocks that are designated in United States dollars and
	that are registered with the Securities and Exchange Commission and
	listed on a United States exchange or by the National Association of
	Securities Dealers Automated Quotations;
	[(6)  foreign equity and fixed income investments;
	[(7)     mutual funds, common funds, and their equivalents
	that contain only items listed in Subdivisions (1)-(6) of this
	section; and
	[(8)     convertible stocks and bonds recognized as
	investment quality or higher by a nationally recognized investment
	rating firm or by the investment manager.]
	SECTION 9.  Section 11.03, Chapter 183 (S.B. 598), Acts of
	the 64th Legislature, Regular Session, 1975 (Article 6243e.1,
	Vernon's Texas Civil Statutes), is amended to read as follows:
	Sec. 11.03.  INVESTMENT POLICY. (a) The board of trustees
	shall adopt and maintain a written investment policy regarding the
	investment of fund assets.
	(b)  The board of trustees may not adopt an amendment to the
	investment policy adopted under this section unless the proposed
	amendment is approved by the affirmative vote of a majority of the
	members of the board at not fewer than three regular meetings of the
	board. [LIMITATIONS ON INVESTMENTS. The fund may not own more than
	five percent of the voting stock of any one corporation. Under an
	investment measure at market:
	[(1)     total fixed-income investments should not
	represent less than 30 percent of the value of the investment
	portfolio;
	[(2)     total investments in common stocks should not
	represent more than 70 percent of the value of the investment
	portfolio;
	[(3)     total investments in common stocks and bonds of
	foreign corporations may not represent more than 20 percent of the
	value of the investment portfolio; and
	[(4)     total investments in any one corporation may not
	represent more than five percent of the value of the investment
	portfolio.]
	SECTION 10.  Sections 9.04(c) and (d), Chapter 183 (S.B.
	598), Acts of the 64th Legislature, Regular Session, 1975 (Article
	6243e.1, Vernon's Texas Civil Statutes), are repealed.
	SECTION 11.  As soon as practicable after the effective date
	of this Act, the board of trustees of the firefighters relief and
	retirement fund shall adopt the written investment policy required
	by Section 11.03, Chapter 183 (S.B. 598), Acts of the 64th
	Legislature, Regular Session, 1975 (Article 6243e.1, Vernon's
	Texas Civil Statutes), as amended by this Act.
	SECTION 12.  This Act takes effect September 1, 2009.
	______________________________	______________________________
	President of the Senate	Speaker of the House
	I certify that H.B. No. 2829 was passed by the House on April
	28, 2009, by the following vote:  Yeas 149, Nays 0, 1 present, not
	voting.
	______________________________
	Chief Clerk of the House
	I certify that H.B. No. 2829 was passed by the Senate on May
	21, 2009, by the following vote:  Yeas 31, Nays 0.
	______________________________
	Secretary of the Senate
	APPROVED:  _____________________
	Date
	_____________________
	Governor