CHAPTER 804. DOMESTIC RELATIONS ORDERS AND SPOUSAL CONSENT - Texas Statutes

GOVERNMENT CODE

TITLE 8. PUBLIC RETIREMENT SYSTEMS

SUBTITLE A. PROVISIONS GENERALLY APPLICABLE TO PUBLIC RETIREMENT

SYSTEMS

CHAPTER 804. DOMESTIC RELATIONS ORDERS AND SPOUSAL CONSENT

SUBCHAPTER A. QUALIFIED DOMESTIC RELATIONS ORDERS

Sec. 804.001. DEFINITIONS. In this chapter:

(1) "Alternate payee" means a spouse, former spouse, child, or

other dependent of a member or retiree who is recognized by a

domestic relations order as having a right to receive all or a

portion of the benefits payable by a public retirement system

with respect to such member or retiree.

(2) "Domestic relations order" means any judgment, decree, or

order, including approval of a property settlement agreement,

which relates to the provision of child support, alimony

payments, or marital property rights to a spouse, former spouse,

child, or other dependent of a member or retiree, and is made

pursuant to a domestic relations law, including a community

property law of the State of Texas or of another state.

(3) "Public retirement system" means the Employees Retirement

System of Texas, the Judicial Retirement System of Texas Plan

One, the Judicial Retirement System of Texas Plan Two, the

Teacher Retirement System of Texas, the Texas County and District

Retirement System, the Texas Municipal Retirement System, and any

other continuing, organized program of service retirement,

disability retirement, or death benefits for officers or

employees of the state or a political subdivision or of an agency

or instrumentality of the state or a political subdivision and

includes the optional retirement program governed by Chapter 830.

Public retirement system does not include:

(A) a program, other than the optional retirement program, for

which benefits are administered by a life insurance company;

(B) a program providing only workers' compensation benefits;

(C) a program administered by the federal government;

(D) an individual retirement account or individual retirement

annuity within the meaning of Section 408, or a retirement bond

within the meaning of Section 409, of the Internal Revenue Code

of 1986;

(E) a plan described by Subsection (d) of Section 401 of the

Internal Revenue Code of 1986;

(F) a group or an individual account plan consisting of an

annuity contract described by Subsection (b) of Section 403 of

the Internal Revenue Code of 1986, other than a 403(b) contract

or plan under the optional retirement program;

(G) an eligible state deferred compensation plan described by

Subsection (b) of Section 457 of the Internal Revenue Code of

1986; or

(H) the program established by Chapter 615.

(4) "Qualified domestic relations order" means a domestic

relations order which creates or recognizes the existence of an

alternate payee's right or assigns to an alternate payee the

right to receive all or a portion of the benefits payable with

respect to a member or retiree under a public retirement system,

which directs the public retirement system to disburse benefits

to the alternate payee, and which meets the requirements of

Section 804.003.

(5) "Statewide retirement system" means the Employees Retirement

System of Texas, the Judicial Retirement System of Texas Plan

One, the Judicial Retirement System of Texas Plan Two, the

Teacher Retirement System of Texas, the Texas County and District

Retirement System, or the Texas Municipal Retirement System.

Added by Acts 1991, 72nd Leg., ch. 16, Sec. 11.02(a), eff. Aug.

26, 1991. Amended by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(32),

eff. Sept. 1, 1995.

Sec. 804.002. APPLICATION OF CHAPTERS. This subchapter and

Subchapter C apply to each statewide retirement system and to the

optional retirement program governed by Chapter 830. This

subchapter and Subchapter C also apply to each other public

retirement system for which the board of trustees of the system

elects to adopt the provisions of this subchapter and Subchapter

C. An election under this section must be by order or resolution

and need not set out the text of this subchapter or Subchapter C.

A board of trustees may not elect to adopt only this subchapter

or Subchapter C.

Added by Acts 1991, 72nd Leg., ch. 16, Sec. 11.02(a), eff. Aug.

26, 1991.

Sec. 804.003. QUALIFIED DOMESTIC RELATIONS ORDERS. (a)

Sections 811.005, 821.005, 831.004, 836.004, 841.006, and 851.006

and any similar antialienation provisions contained in any other

public retirement system shall apply to the creation, assignment,

recognition, or enforcement of a right to any benefit payable

with respect to a member or retiree of a public retirement system

to which the section applies pursuant to a domestic relations

order unless the order is determined to be a qualified domestic

relations order.

(b) Except as provided in Subsection (d), the administrative

head of a public retirement system to which this chapter applies

and to which a domestic relations order is submitted or his

designee has exclusive authority to determine whether a domestic

relations order is a qualified domestic relations order. A

determination by the administrative head or his designee under

this section may be appealed only to the board of trustees of the

public retirement system. An appeal to the board of trustees of a

statewide retirement system is a contested case under Chapter

2001. However, the board of a statewide retirement system by rule

may waive the requirement of an appeal to the board. On appeal of

a decision made by the board of trustees or by the administrative

head if there is no appeal to the board under this section, the

standard of review is by substantial evidence.

(c) Except as provided in Subsection (d), a court does not have

jurisdiction over a public retirement system to which this

chapter applies with respect to a divorce or other domestic

relations action in which an alternate payee's right to receive

all or a portion of the benefits payable to a member or retiree

under the public retirement system is created or established. A

party to such an action who attempts to make a public retirement

system a party to the action contrary to the provision of this

subsection shall be liable to the public retirement system for

its costs and attorney's fees.

(d) Under the optional retirement program, applicable carriers

shall determine whether a domestic relations order is a qualified

domestic relations order. If a dispute arises over the

determination of whether a domestic relations order is a

qualified domestic relations order which cannot be resolved by

the procedure described in Subsection (g), the court which issued

the order or which otherwise has jurisdiction over the matter

shall resolve the dispute with respect to a divorce or other

domestic relations action in which an alternate payee's right to

receive all or a portion of the benefits payable to a member or

retiree under the optional retirement program is created or

established.

(e) For the purposes of this section, benefits payable with

respect to a member or retiree under the retirement system

include the types of benefits payable by a public retirement

system and a withdrawal of contributions from a public retirement

system.

(f) A domestic relations order is a qualified domestic relations

order only if such order:

(1) clearly specifies the name, social security number, and last

known mailing address, if any, of the member or retiree and the

name, social security number, and mailing address of each

alternate payee covered by the order;

(2) clearly specifies the amount or percentage of the member's

or retiree's benefits to be paid by a public retirement system to

each such alternate payee or the manner in which such amount or

percentage is to be determined;

(3) clearly specifies the number of payments or the period to

which such order applies;

(4) clearly specifies that such order applies to a designated

public retirement system;

(5) does not require the public retirement system to provide any

type or form of benefit or any option not otherwise provided

under the plan;

(6) does not require the public retirement system to provide

increased benefits determined on the basis of actuarial value;

(7) does not require the payment of benefits to an alternate

payee which are required to be paid to another alternate payee

under another order previously determined to be a qualified

domestic relations order; and

(8) does not require the payment of benefits to an alternate

payee before the retirement of a member, the distribution of a

withdrawal of contributions to a member, or other distribution to

a member required by law.

(g) A public retirement system may reject a domestic relations

order as a qualified domestic relations order unless the order:

(1) provides for a proportional reduction of the amount awarded

to an alternate payee in the event of the retirement of the

member before normal retirement age;

(2) does not purport to require the designation of a particular

person as the recipient of benefits in the event of a member's or

annuitant's death;

(3) does not purport to require the selection of a particular

benefit payment plan or option;

(4) provides clearly for each possible benefit distribution

under plan provisions;

(5) does not require any action on the part of the retirement

system contrary to its governing statutes or plan provision other

than the direct payment of the benefit awarded to an alternate

payee;

(6) does not make the award of an interest contingent on any

condition other than those conditions resulting in the liability

of a retirement system for payments under its plan provisions;

(7) does not purport to award any future benefit increases that

are provided or required by the legislature; and

(8) provides for a proportional reduction of the amount awarded

to an alternate payee in the event that benefits available to the

retiree or member are reduced by law.

(h) The administrative head of a public retirement system to

which this chapter applies or his designee (or applicable

carrier, if under the optional retirement program), upon receipt

of a certified copy of a domestic relations order, shall

determine whether such order is a qualified domestic relations

order and shall notify the member or retiree and each alternate

payee of such determination. If the order is determined to be a

qualified domestic relations order, the public retirement system

(or applicable carrier, if under the optional retirement

program), shall pay benefits in accordance with the order. If the

order is determined not to be a qualified domestic relations

order, the member or retiree or any alternate payee named in the

order may appeal the administrative head's determination in the

manner specified in Subsection (b) or the optional retirement

program carrier's determination in the manner specified in

Subsection (d) and may petition the court which issued the order

to amend the order so that it will be qualified. The court which

issued the order or which would otherwise have jurisdiction over

the matter has jurisdiction to amend the order so that it will be

qualified even though all other matters incident to the action or

proceeding have been fully and finally adjudicated.

(i) During any period in which the issue of whether a domestic

relations order is a qualified domestic relations order is being

determined by the agency administrative head, his designee, the

board of trustees, a court of competent jurisdiction, optional

retirement program carrier, or otherwise, the public retirement

system shall separately account for the amounts, in this section

referred to as the "segregated amounts," which would have been

payable to the alternate payee during such period if the order

had been determined to be a qualified domestic relations order.

(j) If a domestic relations order is determined to be a

qualified domestic relations order, then the public retirement

system (or applicable carrier, if under the optional retirement

program) shall pay the segregated amounts without interest to the

person or persons entitled thereto and shall thereafter pay

benefits pursuant to the order.

(k) If a domestic relations order is determined not to be a

qualified domestic relations order or if within 18 months of the

date a domestic relations order is received by the public

retirement system (or applicable carrier, if under the optional

retirement program) the issue as to whether such order is a

qualified domestic relations order is not resolved, then the

public retirement system (or applicable carrier, if under the

optional retirement program) shall pay the segregated amounts

without interest and shall thereafter pay benefits to the person

or persons who would have been entitled to such amounts if there

had been no order. This subsection shall not be construed to

limit or otherwise affect any liability, responsibility, or duty

of a party with respect to any other party to the action out of

which the order arose.

(l) Any determination that an order is a qualified domestic

relations order which is made after the close of the 18-month

period shall be applied prospectively only.

(m) The public retirement system, the board of trustees, and

officers and employees of the public retirement system (or

applicable carrier, if under the optional retirement program)

shall not be liable to any person for making payments of any

benefits in accordance with a domestic relations order in a cause

in which a member or a retiree was a party or for making payments

in accordance with Subsection (k).

(n) The board of trustees of a public retirement system may

promulgate rules it deems necessary to implement the provisions

of this section.

(o) Except as specifically provided in this subtitle or by any

other statute, public employment does not confer special

privileges or immunities on a public employee. An ownership or

beneficial interest in any retirement, pension, or other

financial plan not included in the definition of "public

retirement system" as set forth in Section 804.001 held in whole

or in part by an officer or employee of the state or a political

subdivision or of an agency or an instrumentality of either,

whether obtained in connection with that employment or otherwise,

shall be subject to the requirements of the federal laws

governing qualified domestic relations orders.

Added by Acts 1991, 72nd Leg., ch. 16, Sec. 11.02(a), eff. Aug.

26, 1991. Amended by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(50),

eff. Sept. 1, 1995.

Sec. 804.004. LIFE ANNUITY OR LUMP-SUM PAYMENT IN LIEU OF

BENEFITS AWARDED BY A QUALIFIED DOMESTIC RELATIONS ORDER. (a)

The board of trustees of a public retirement system to which this

chapter applies may by rule provide that, in lieu of paying an

alternate beneficiary the interest awarded by a qualified

domestic relations order, the system may pay the alternate

beneficiary an amount that is the actuarial equivalent of such

interest in the form of:

(1) an annuity payable in equal monthly installments for the

life of the alternate payee; or

(2) a lump sum.

(b) The determination of whether to pay an amount authorized by

this section in lieu of the interest awarded by the qualified

domestic relations order shall be at the sole discretion of the

public retirement system.

(c) If a public retirement system elects to pay the alternate

payee pursuant to this section, the benefit payable by the system

to the member, retiree, or beneficiary shall be reduced by the

interest in the benefit awarded to the alternate payee by the

qualified domestic relations order.

(d) If the public retirement system pays the alternate payee

pursuant to this section, the retirement system shall be entitled

to rely on a beneficiary designation or benefit option selection

made or changed pursuant to its plan without regard to any

domestic relations order.

Added by Acts 1991, 72nd Leg., ch. 16, Sec. 11.02(a), eff. Aug.

26, 1991.

Sec. 804.005. PAYMENT IN CERTAIN CIRCUMSTANCES IN LIEU OF

BENEFITS AWARDED BY QUALIFIED DOMESTIC RELATIONS ORDER. (a)

This section applies only to the Employees Retirement System of

Texas and the Teacher Retirement System of Texas.

(b) A public retirement system to which this section applies

shall pay an alternate payee of a member of the retirement system

who is described by Subsection (c), if the alternate payee so

elects and in lieu of the interest awarded by a qualified

domestic relations order on or after January 1, 1985, an amount

that is the alternate payee's portion of the actuarial equivalent

of the accrued retirement benefit of the member of the retirement

system, determined as if the member retired on the date of the

alternate payee's election. The amount becomes payable at the

time the actuarial equivalent is determined, and the amount is

payable in the form of an annuity payable in equal monthly

installments for the life of the alternate payee.

(c) A member whose benefits are subject to partial payment under

this section is one who has not retired from the retirement

system, has attained the greater of the age of 62 or normal

retirement age and the service requirements for service

retirement, and retains credit and contributions in the

retirement system attributable to that service.

(d) If an alternate payee elects to be paid under this section,

the retirement system shall reduce the benefit payable by the

system to the member or the member's beneficiary by the alternate

payee's portion of the actuarial equivalent determined under

Subsection (b).

(e) In determining under Subsection (b) the actuarial equivalent

of an accrued retirement benefit, the system shall consider the

member's benefit as a normal age standard service retirement

annuity, without regard to any optional annuity chosen or

beneficiary designated by the member.

(f) The beginning of monthly payments under this section

terminates any interest that the alternate payee who receives the

payment might otherwise have in benefits that accrue to the

account of the member after the date the initial payment to the

alternate payee is made.

(g) A public retirement system may adopt rules for

administration of this section.

Added by Acts 1993, 73rd Leg., ch. 867, Sec. 1, eff. Sept. 1,

1993.

SUBCHAPTER B. SPOUSAL CONSENT REQUIREMENTS

Sec. 804.051. AUTHORITY TO REQUIRE SPOUSAL CONSENT. A public

retirement system may adopt rules to require spousal consent for

the selection of a service retirement annuity other than a joint

and survivor annuity that pays benefits to the member's spouse on

the death of the member or for the selection of a death benefits

plan that pays benefits in the form of an annuity to a person

other than the member's spouse on the death of the member.

Added by Acts 1991, 72nd Leg., ch. 16, Sec. 11.02(a), eff. Aug.

26, 1991.

SUBCHAPTER C. TERMINATION OF INTEREST IN PUBLIC RETIREMENT SYSTEM

Sec. 804.101. TERMINATION OF INTEREST IN PUBLIC RETIREMENT

SYSTEM. The death of an alternate payee as defined in Section

804.001 or the death of a spouse of a member or retiree of a

public retirement system to which this chapter applies shall

terminate the interest of the alternate payee or spouse in that

public retirement system. This section shall not affect an

interest in a public retirement system accrued to an individual

as a member of the public retirement system.

Added by Acts 1991, 72nd Leg., ch. 16, Sec. 11.02(a), eff. Aug.

26, 1991.