HBA-SEB C.S.H.B. 2437 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 2437 By: Uher Pensions and Investments 4/26/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE Currently, when a peace officer who is a member of the Employees Retirement System of Texas (ERS) retires because of a disability incurred in the line of duty, the officer retires with an annuity of 50 percent to 100 percent of the officer's monthly compensation, depending on the officer's tenure with the state. Under current law, the annuity is not adjusted for cost of living or salary increases. C.S.H.B. 2437 makes peace officers who are disabled in the line of duty eligible to receive an annuity of at least 70 percent of the monthly compensation being paid to an officer in the same classification as the disabled officer, as adjusted from time to time until the officer reaches age 55, regardless of the amount of service credited to the disabled officer. This bill also allows a disabled officer to receive 100 percent of that amount if the officer is incapable of gainful employment and has a total disability. 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. SECTION BY SECTION ANALYSIS SECTION 1. Amends Sections 814.207 (b), (c), and (e), Government Code, as follows: (b) Provides that except as provided by Subsection (c) or (e), an occupational disabiity under this section (Disability Retirement Benefits for Certain Peace Officers) is an amount, but not more than 100 percent, computed on the basis of the officer's monthly compensation at the time of the disabling injury or disease, times a percentage derived by application of Section 814.107(b) (regarding service retirement benefits for certain peace officers). (c) Prohibits a disability retirement annuity under this section from being less than 70, rather than 50, percent of the monthly compensation being paid to an officer in the same classification as the officer, as adjusted from time to time until the retired officer reaches age 55, regardless of the amount of service credited to the officer in the employee class of the Employees Retirement System of Texas (ERS). (e) Requires ERS to increase an officer's occupational disability retirement annuity to 100 percent of the monthly compensation being paid to an officer in the same classification as the retired officer, as adjusted from time to time until the retired officer reaches age 55, rather than 100 percent of the compensation at the time of the disabling injury or disease. Provides that this subsection applies if a retiring member or retiree presents evidence satisfactory to ERS that the officer is incapable of gainful employment and has a total disability under federal social security law. SECTION 2. Requires ERS to recompute an annuity that first became payable before September 1, 1999, as through Section 814.207(c), as amended by this Act, was in effect on the date the first annuity became available. Provides that the first recomputed annuity is payable on the first payment date occurring on or after the effective date of this Act. SECTION 3. Effective date: September 1, 1999. SECTION 4. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The substitute modifies the original in SECTION 1 by modifying and amending Section 814.207(b), (c), and (e), Government Code, as follows: (b) The substitute reinstates the text of this subsection, which would have been deleted in the original. The substitute adds a provision making Subsection (e) and exception to this subsection. (c) The substitute prohibits a disability retirement annuity under this section from being less than 70 percent of the monthly compensation being paid to an officer in the same classification as the officer, as adjusted from time to time until the retired officer reaches age 55, regardless of the amount of service credited to the officer in the employee class of ERS. The original would have provided that a disability retirement annuity under this section is 100 percent of that amount. The substitute reinstates a phrase that would have been deleted in the original, which provides that a disability retirement annuity under this section is not reducible because of age. (e) The substitute reinstates the text of this subsection, which would have been deleted in the original, and amends it. The substitute requires ERS to increase an officer's occupational disability retirement annuity to 100 percent of the monthly compensation being paid to an officer in the same classification as the retired officer, as adjusted from time to time until the retired officer reaches age 55, rather than 100 percent of the compensation at the time of the disabling injury or disease. The substitute adds new text for SECTION 2, which requires ERS to recompute an annuity that first became payable before September 1, 1999, as through Section 814.207(c), as amended by this Act, was in effect on the date the first annuity became available. SECTION 2 of the substitute also provides that the first recomputed annuity is payable on the first payment date occurring on or after the effective date of this Act. The substitute redesignates the text of SECTIONS 2 (effective date) and 3 (emergency clause) of the original to SECTIONS 3 and 4 of the substitute.