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