89R15291 KFF-D     By: Creighton S.B. No. 2234       A BILL TO BE ENTITLED   AN ACT   relating to the firefighters' relief and retirement fund of certain   municipalities.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  The heading to Article 6243e.2(1), Revised   Statutes, is amended to read as follows:          Art. 6243e.2(1). FIREFIGHTERS' RELIEF AND RETIREMENT FUND IN   MUNICIPALITIES OF AT LEAST 2,000,000 [1,600,000] POPULATION.          SECTION 2.  Section 1(13-e), Article 6243e.2(1), Revised   Statutes, is amended to read as follows:                (13-e)  "Normal retirement age" means:                      (A)  [for a member, including a member who was   hired before the year 2017 effective date and who involuntarily   separated from service but has been retroactively reinstated in   accordance with an arbitration, civil service, or court ruling,   hired before the year 2017 effective date,] the age at which a [the]   member attains 20 years of service; or                      (B)  [except as provided by Paragraph (A) of this   subdivision, for a member hired or rehired on or after the year 2017   effective date,] the age at which the member first attains both the   age of at least 50 and at least 10 years of service [sum of the   member's age, in years, and the member's years of participation in   the fund equals at least 70].          SECTION 3.  Section 2(a), Article 6243e.2(1), Revised   Statutes, is amended to read as follows:          (a)  A firefighters' relief and retirement fund is   established in each incorporated municipality that has a population   of at least 2,000,000 [1,600,000] and a fully paid fire department.          SECTION 4.  Section 4(a), Article 6243e.2(1), Revised   Statutes, is amended to read as follows:          (a)  A member who terminates active service for any reason   other than death is entitled to receive a service pension provided   by this section if the member was:                (1)  hired as a firefighter before the year 2017   effective date, including a member who was hired before the year   2017 effective date and who involuntarily separated from service   but has been retroactively reinstated in accordance with an   arbitration, civil service, or court ruling, at the age at which the   member attains 20 years of service; and                (2)  except as provided by Subdivision (1) of this   subsection and subject to Subsection (b-2) of this section, hired   or rehired as a firefighter on or after the year 2017 effective   date, at the age at which the member attains 20 years of service   [when the sum of the member's age in years and the member's years of   participation in the fund equals at least 70].          SECTION 5.  Sections 5(a), (b), (b-1), (c), (d), (l), and   (m), Article 6243e.2(1), Revised Statutes, are amended to read as   follows:          (a)  A member who is eligible to receive a service pension   under Section 4 [4(a)(1)] of this article and who remains in active   service may elect to participate in the deferred retirement option   plan provided by this section. [A member who is eligible to receive   a service pension under Section 4(a)(2) of this article may not   elect to participate in the deferred retirement option plan   provided by this section.]  On subsequently terminating active   service, a member who elected the DROP may apply for a monthly   service pension under Section 4 of this article, except that the   effective date of the member's election to participate in the DROP   will be considered the member's retirement date for determining the   amount of the member's monthly service pension.  The member may also   apply for any DROP benefit provided under this section on   terminating active service.  An election to participate in the   DROP, once approved by the board, is irrevocable.          (b)  A member may elect to participate in the DROP by   complying with the election process established by the board.  The   member's election may be made at any time beginning on the date the   member has completed 20 years of participation in the fund and is   otherwise eligible for a service pension under Section 4 [4(a)(1)]   of this article.  Beginning on the first day of the month following   the month in which the member makes an election to participate in   the DROP, subject to board approval, and ending on the year 2017   effective date, amounts equal to the deductions made from the   member's salary under Section 13(c) of this article shall be   credited to the member's DROP account.  Beginning after the year   2017 effective date, amounts equal to the deductions made from the   member's salary under Section 13(c) of this article may not be   credited to the member's DROP account.          (b-1)  On or after the year 2017 effective date, an active   member may not participate in the DROP for more than 20 [13] years.     If a DROP participant remains in active service after the 20th   [13th] anniversary of the effective date of the member's DROP   election:                (1)  subsequent deductions from the member's salary   under Section 13(c) of this article, except for unused leave pay,   may not be credited to the member's DROP account; and                (2)  the account shall continue to be credited with   earnings in accordance with Subsection (d) of this section.          (c)  After a member's DROP election becomes effective, an   amount equal to the monthly service pension the member would have   received under Section 4 of this article, if applicable, had the   member terminated active service on the effective date of the   member's DROP election shall be credited to a DROP account   maintained for the member.  That monthly credit to the member's DROP   account shall continue until the earlier of the date the member   terminates active service or the 20th [13th] anniversary of the   date of the first credit to the member's DROP account.          (d)  A member's DROP account shall be credited with earnings   at an annual rate equal to 70 [65] percent of the [compounded]   average annual return earned by the fund over the five years   preceding, but not including, the year during which the credit is   given.  Notwithstanding the preceding, however, the credit to the   member's DROP account shall be at an annual rate of not less than   2.5 percent, irrespective of actual earnings.          (l)  A member who participates in the DROP is ineligible for   disability benefits described by Section 6 of this article, except   that a member with less than 13 years of DROP participation is   eligible for the benefits described by Section 6(c).  If a member   who has a disability described by Section 6(c) of this article is a   DROP participant with less than 13 years of DROP participation, the   disability benefit provided by Section 6(c)(1) shall be paid to the   member, as a monthly pension benefit, in addition to payments from   the DROP account balance.  If a member who dies under the conditions   described by Section 7(c) of this article is a DROP participant at   the time of death or disability resulting in death, the benefit   provided by Section 7(c) shall be paid to the member's eligible   survivors, as a monthly pension benefit, in addition to payments   from the DROP account balance.          (m)  A DROP participant with a break in service may receive   service credit within DROP for days worked after the regular   expiration of the maximum DROP participation period prescribed by   this section.  The service credit shall be limited to the number of   days in which the participant experienced a break in service or the   number of days required to constitute 20 [13] years of DROP   participation, whichever is smaller.  A retired member who   previously participated in the DROP and who returns to active   service is subject to the terms of this section in effect at the   time of the member's return to active service.          SECTION 6.  Sections 8(a) and (c), Article 6243e.2(1),   Revised Statutes, are amended to read as follows:          (a)  A [On or after the year 2017 effective date, a] member   who [is hired as a firefighter before the year 2017 effective date,   including a member who was hired before the year 2017 effective date   and who involuntarily separated from service but has been   retroactively reinstated in accordance with an arbitration, civil   service, or court ruling,] terminates active service for any reason   other than death with at least 10 years of participation, but less   than 20 years of participation, is entitled to a monthly deferred   pension benefit, beginning at age 50, in an amount equal to 1.7   percent of the member's average monthly salary multiplied by the   amount of the member's years of participation.          (c)  A [Except as provided by Subsection (a) of this section,   a member who is hired or rehired as a firefighter on or after the   year 2017 effective date or a] member who terminates active service   [employment] for any reason other than death before the member has   completed 10 years of participation is entitled only to a refund of   the member's contributions without interest and is not entitled to   a deferred pension benefit under this section or to any other   benefit under this article.  The member's refund shall be paid as   soon as administratively practicable after the effective date of   the member's termination of active service.          SECTION 7.  Sections 1(13-e) and 4(a), Article 6243e.2(1),   Revised Statutes, as amended by this Act, apply to a member who   retires on or after the effective date of this Act.          SECTION 8.  Section 5, Article 6243e.2(1), Revised Statutes,   as amended by this Act, applies to a member who participates in the   deferred retirement option plan on or after the effective date of   this Act regardless of whether the member began participation in   the plan before, on, or after the effective date of this Act.          SECTION 9.  Section 8, Article 6243e.2(1), Revised Statutes,   as amended by this Act, applies to a member who terminates active   service on or after the effective date of this Act.          SECTION 10.  This Act takes effect January 1, 2026.