CHAPTER 853. CREDITABLE SERVICE - Texas Statutes

GOVERNMENT CODE

TITLE 8. PUBLIC RETIREMENT SYSTEMS

SUBTITLE G. TEXAS MUNICIPAL RETIREMENT SYSTEM

CHAPTER 853. CREDITABLE SERVICE

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 853.001. TYPES OF CREDITABLE SERVICE. The types of service

creditable as credited service in the retirement system are prior

service and current service.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.001 by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff. Sept. 1,

1989.

Sec. 853.002. BENEFIT ELIGIBILITY BASED ON CREDITED SERVICE. A

member's eligibility to receive a benefit is based on credited

service at the time of retirement.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.002 by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff. Sept. 1,

1989.

Sec. 853.003. CREDITED SERVICE PREVIOUSLY CANCELED. (a) An

eligible member who has withdrawn contributions and canceled

credited service in the retirement system may reestablish the

canceled credit in the system if the governing body of the

municipality that currently employs the member by ordinance

authorizes reestablishment of the credit by eligible employee

members.

(b) A member eligible to reestablish credit under this section

is one who has, since resuming membership, at least 24

consecutive months of credited service as an employee of the

municipality for which the ordinance was adopted.

(c) A member may reestablish credit by depositing with the

retirement system in a lump sum the amount withdrawn from the

system, plus a withdrawal charge computed at an annual rate of

five percent from the date of withdrawal to the date of

redeposit.

(d) Credit reestablished under this section is treated as if all

service on which the credit is based were performed for the

municipality authorizing the reestablishment.

(e) A governing body may not adopt an ordinance under Subsection

(a) unless the actuary first determines that all obligations

charged against the municipality's account in the municipality

accumulation fund, including the obligations proposed in the

ordinance, can be funded by the municipality within its maximum

contribution rate and within its amortization period.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Amended by Acts 1981, 67th Leg., 1st C.S., p. 220, ch. 18,

Sec. 72, eff. Jan. 1, 1982. Renumbered from Vernon's Ann.Civ.St.

Title 110B, Sec. 63.003 and amended by Acts 1989, 71st Leg., ch.

179, Sec. 1, eff. Sept. 1, 1989.

SUBCHAPTER B. ESTABLISHMENT OF PRIOR SERVICE

Sec. 853.101. CREDITABLE PRIOR SERVICE. Prior service

creditable in the retirement system is:

(1) service performed as an employee of a participating

department of a municipality before the date the department's

participation in the retirement system became effective;

(2) for a person who becomes a member of the retirement system

under Section 852.105, service performed as an employee of a

participating department during a time the person was ineligible

for membership because of age; or

(3) for a person entitled to prior service credit under Section

853.102(a)(3), service for which current service credit has not

been granted that was performed as an employee of a participating

department during a time the person was ineligible to participate

because of age.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Amended by Acts 1981, 67th Leg., 1st C.S., p. 220, ch. 18,

Sec. 73, eff. Jan. 1, 1982. Renumbered from Vernon's Ann.Civ.St.

Title 110B, Sec. 63.101 and amended by Acts 1989, 71st Leg., ch.

179, Sec. 1, eff. Sept. 1, 1989.

Sec. 853.102. ELIGIBILITY FOR PRIOR SERVICE. (a) A member is

eligible to receive credit in the retirement system for prior

service if the member:

(1) became a member as an employee of a department of a

municipality on the effective date of the department's

participation in the retirement system;

(2) became a member as an employee of a department of a

municipality before the fifth anniversary of the effective date

of the department's participation and continued as an employee of

a participating department of the municipality for at least five

consecutive years after reemployment; or

(3) became a member September 1, 1987, by virtue of Sections

852.101(a)(3) and (b) and has service before that date with a

municipality that has adopted the provisions of Section 852.105.

(b) The board of trustees may adopt rules concerning eligibility

for prior service under this section.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Amended by Acts 1981, 67th Leg., 1st C.S., p. 221, ch. 18,

Sec. 74, eff. Jan. 1, 1982; Acts 1987, 70th Leg., ch. 183, Sec.

6, eff. Aug. 31, 1987. Renumbered from Vernon's Ann.Civ.St. Title

110B, Sec. 63.102 and amended by Acts 1989, 71st Leg., ch. 179,

Sec. 1, eff. Sept. 1, 1989.

Sec. 853.103. STATEMENT OF PRIOR SERVICE. A member may claim

credit for prior service by filing a detailed statement of the

service with the city clerk or city secretary of the municipality

for which the service was performed.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.103 by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff. Sept. 1,

1989.

Sec. 853.104. CERTIFICATION OF SERVICE AND AVERAGE COMPENSATION.

(a) As soon as practicable after a member files a statement of

prior service under Section 853.103, the municipality that

employs the person who receives the statement shall verify the

prior service claimed and certify to the board of trustees the

amount of service approved and the member's average prior service

compensation.

(b) The average prior service compensation of a member is

computed as the average monthly compensation for service

performed for a participating department of the municipality:

(1) for the 36 months immediately preceding the effective date

of the department's participation in the retirement system; or

(2) if the member did not perform service in each of the 36

months immediately preceding participation, for the number of

months of service within the 36-month period.

(c) The board of trustees may adopt rules concerning

verification and certification of service and compensation under

this section.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.104 and amended by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff.

Sept. 1, 1989.

Sec. 853.105. DETERMINATION OF PRIOR SERVICE CREDIT. (a) After

receiving a certification of prior service and average prior

service compensation under Section 853.104, the board of trustees

shall determine the member's prior service credit.

(b) For an employee of a municipality having an effective date

of participation in the retirement system before January 1, 1976,

the prior service credit is an amount equal to the accumulation

at interest of a series of equal monthly amounts for the number

of months of approved prior service. Each monthly amount equals

10 percent of the member's average prior service compensation, or

$300 a month, whichever is less. Interest is allowed at the end

of each 12-month period on an accumulated amount at the beginning

of each period and is credited only for each whole 12-month

period.

(c) For an employee of a municipality having an effective date

of participation in the retirement system after December 31,

1975, the prior service credit is an amount computed as a

percentage determined as provided by Subsection (d), times a base

credit equal to the accumulation at three percent interest of a

series of monthly amounts for the number of months of approved

prior service, times the sum of:

(1) the rate of contributions required of employees of the

municipality for current service; plus

(2) the rate described in Subdivision (1) times the municipal

current service matching ratio.

(d) The governing body of a municipality having an effective

date of retirement system participation after December 31, 1975,

shall determine in the ordinance providing for participation the

percentage to be applied against the base credit in computing a

prior service credit under Subsection (c). The percentage adopted

may be any multiple of 10 percent that does not exceed 100

percent of the base credit. A governing body may not adopt a

percentage under this subsection until the actuary first

determines, and the board of trustees concurs in the

determination, that the municipality is able to fund, before the

25th anniversary of the effective date of its participation in

the retirement system, all prior service obligations that the

municipality proposes to assume under this section.

(e) The prior service credit of a person who becomes a member of

the retirement system under Section 852.105 or who is entitled to

prior service credit under Section 853.102(a)(3) is computed on

the percentage of the base prior service credit that was most

recently used by the person's employing municipality in computing

prior or updated service credits for current employees.

(f) Interest on a prior service credit is earned for each whole

calendar year beginning on the effective date of membership and

ending on the effective date of retirement. If a person retires

under this subtitle on a date other than December 31, interest on

a prior service credit is earned for the partial year in which

the retirement occurs, prorated from January 1 of the year in

which the retirement occurs to the effective date of retirement.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Amended by Acts 1981, 67th Leg., 1st C.S., p. 221, ch. 18,

Sec. 75, eff. Jan. 1, 1982. Renumbered from Vernon's Ann.Civ.St.

Title 110B, Sec. 63.105 and amended by Acts 1989, 71st Leg., ch.

179, Sec. 1, eff. Sept. 1, 1989. Amended by Acts 2001, 77th Leg.,

ch. 121, Sec. 5, eff. Jan. 1, 2002.

Sec. 853.106. PRIOR SERVICE CERTIFICATE. (a) After determining

a member's prior service credit under Section 853.105, the board

of trustees shall issue to the member a prior service certificate

stating:

(1) the number of months of prior service credited;

(2) the average prior service compensation; and

(3) the prior service credit.

(b) As long as a person remains a member, the person's prior

service certificate is, for purposes of retirement, conclusive

evidence of the information it contains, except that a member or

participating municipality, before the first anniversary of its

issuance or modification, may request the board of trustees to

modify the certificate.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.106 and amended by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff.

Sept. 1, 1989.

Sec. 853.107. VOID PRIOR SERVICE CERTIFICATE. (a) When a

person's membership in the retirement system is terminated, any

prior service certificate issued to the person becomes void.

(b) A person whose membership has terminated and who

subsequently resumes membership in the retirement system is not

entitled to credit for prior service.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.107 by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff. Sept. 1,

1989.

SUBCHAPTER C. ESTABLISHMENT OF CURRENT SERVICE

Sec. 853.201. CREDITABLE CURRENT SERVICE. Service performed as

an employee member of a participating department of a

municipality is credited in the retirement system for each month

for which the required contributions are made by the member.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.201 by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff. Sept. 1,

1989.

SUBCHAPTER D. OPTIONAL SERVICE

Sec. 853.301. SERVICE FOR CERTAIN PUBLIC FACILITIES. (a) The

governing body of a participating municipality by ordinance may

authorize the granting of prior service credit in the retirement

system for service performed in a public hospital, utility, or

other public facility currently operated by the municipality,

during a time the facility was operated by a unit of government

other than the municipality and before:

(1) the effective date of the municipality's participation in

the retirement system, if the facility was acquired by the

municipality before that date; or

(2) the date of acquisition of the facility, if the facility was

acquired after the effective date of the municipality's

participation in the retirement system.

(b) A member eligible to receive credit under this section after

an ordinance is adopted under Subsection (a) is one who was

employed by the municipality at a public facility:

(1) on the effective date of the municipality's participation,

for service under Subsection (a)(1); or

(2) on the date of acquisition of the facility, for service

under Subsection (a)(2).

(c) All credit authorized by a municipality under this section

is treated as if it were performed for the municipality.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.301 and amended by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff.

Sept. 1, 1989.

Sec. 853.302. SERVICE FOR ELECTED OFFICERS. An elected officer

who becomes a member of the retirement system on the effective

date of an ordinance adopted under Section 852.107 is entitled to

prior service credit computed as provided by Section 853.105,

except that if the employing municipality has granted updated

service credits, the percentage to be used in computing a prior

service credit under this section is the percentage of the base

updated service credit that was most recently used by the

municipality in computing updated service credits.

Added by Acts 1981, 67th Leg., 1st C.S., p. 221, ch. 18, Sec. 76,

eff. Jan. 1, 1982. Renumbered from Vernon's Ann.Civ.St. Title

110B, Sec. 63.302 and amended by Acts 1989, 71st Leg., ch. 179,

Sec. 1, eff. Sept. 1, 1989.

Sec. 853.303. PRIOR SERVICE CREDIT FOR SERVICE FOR

NONPARTICIPATING DEPARTMENT. (a) The governing body of a

participating municipality by ordinance may authorize the

granting of prior service credit in the retirement system to an

employee who is a member of the retirement system and who became

a member as an employee of a participating department of the

municipality, for service performed, before the person's date of

membership, as an employee of a department of the same

municipality that was not participating in the retirement system

at the time of the service but later became a participating

department.

(b) A member may claim prior service credit under this section

by filing, not later than one year after the effective date of

the ordinance authorizing the credit, a detailed statement of the

service with the clerk or secretary of the municipality.

(c) As soon as practicable after a member has filed a statement

of prior service under this section, the municipality shall

verify the prior service claimed and certify to the board of

trustees the creditable prior service approved and the average

monthly compensation paid to the member during the period of the

service.

(d) After receiving a certification of prior service and average

monthly compensation under this section, the board of trustees

shall:

(1) determine the prior service credit allowable to the member

in the manner provided by Section 853.105; and

(2) issue to the member a prior service certificate as provided

by Section 853.106.

Added by Acts 1989, 71st Leg., ch. 136, Sec. 1, eff. May 25,

1989. Renumbered from Title 110B, Sec. 63.303 and amended by Acts

1989, 71st Leg., ch. 1100, Sec. 4.08(a)(1) to (3), eff. Sept. 1,

1989.

Sec. 853.304. PRIOR SERVICE CREDIT FOR PROBATIONARY EMPLOYMENT.

(a) The governing body of a participating municipality which

prior to September 1, 1989, engaged persons beginning work with

the municipality on a probationary basis for a specified period

and consequently did not enroll the person as a member of the

system until the probationary period expired may by ordinance

allow prior service credit for service performed during the

period of probationary employment (not exceeding six months) with

the municipality.

(b) After the retirement system receives a copy of a

municipality's ordinance described by Subsection (a), the

retirement system shall furnish to the municipality a report

containing the names of employees who, according to the

retirement system's records, are eligible to receive prior

service credit for probationary employment.

(c) As soon as practicable after the municipality receives a

report under Subsection (b), the municipality shall verify the

information in the report and certify to the retirement system

the number of months of probationary employment to which each

employee listed on the report appears to be entitled and the

average monthly compensation paid to the member during the period

of probationary employment.

(d) The certification by the municipality must be received by

the retirement system not later than the first anniversary of the

effective date of the ordinance allowing the credit. After

receiving the certification from the municipality described by

Subsection (c), the board of trustees shall determine the prior

service credit allowable to the member in the manner provided in

Section 853.105.

Added by Acts 1991, 72nd Leg., ch. 16, Sec. 11.01(b), eff. Aug.

26, 1991. Amended by Acts 2001, 77th Leg., ch. 121, Sec. 6, eff.

Jan. 1, 2002.

Sec. 853.305. CREDIT FOR SERVICE WITH NONPARTICIPATING

MUNICIPALITY, AIRPORT AUTHORITY, OR COUNCIL OF GOVERNMENTS, OR

CERTAIN SERVICE PREVIOUSLY CANCELED. (a) The governing body of

a participating municipality by ordinance may authorize the

granting of restricted prior service credit to an employee who is

a member of the retirement system for service previously

performed:

(1) as a full-time, paid employee of the United States, of any

public authority or agency created by the United States, of any

state or territory of the United States, of any political

subdivision of any state of the United States, of any public

agency or authority created by a state or territory of the United

States, or of an institution of higher education at which the

person is commissioned as a campus security personnel employee

under Section 51.212, Education Code, and for which service the

person has not otherwise received credited service in this

system, including combined service credit under Chapter 803; or

(2) as an employee of the state or any branch, agency, or

subdivision of the state for which the person received credited

service under the Employees Retirement System of Texas, the

Teacher Retirement System of Texas, the Judicial Retirement

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

Plan Two, the Texas County and District Retirement System, or

this retirement system, and the credit for which was canceled

because of withdrawal of contributions and has not been

reinstated.

(b) Restricted prior service credit may be used only to satisfy

length-of-service requirements for retirement eligibility, has no

monetary value in computing the annuity payments allowable to the

member, and may not be used in other computations, including

computation of updated service credits.

(c) A member seeking to establish restricted prior service

credit under Subsection (a)(1) must obtain from the official

custodian of personnel records of the entity for which the

previous service was performed a detailed statement of the

service, verified by that official, and file the statement with

the clerk or secretary of the participating municipality by which

the member is employed. A member seeking to establish restricted

prior service credit under Subsection (a)(2) must obtain from the

public retirement system in which the canceled service was

credited a detailed statement of the service, verified by an

official of that retirement system, and file that statement with

the clerk or secretary of the participating municipality by which

the member is employed.

(d) As soon as practicable after the member has filed the

verified statement, the clerk or secretary of the participating

municipality authorizing the credit shall examine the statement.

If satisfied that the claim is correct, the clerk or secretary

shall endorse the statement as approved, file the original in the

appropriate files of the granting municipality, and prepare and

transmit to the director of the retirement system a certified

copy of the approved claim.

(e) On receipt of a certified copy of an approved claim, the

retirement system, if satisfied that credit for service claimed

under Subsection (a)(1) has not previously been granted the

member, or that credit claimed under Subsection (a)(2) previously

existed but has been canceled and not reinstated, shall enter the

credit in the member's records.

(f) In this section, "full-time, paid employee" has the meaning

assigned "employee" by Section 851.001, except that the services

do not have to be performed for a municipality.

(g) An ordinance adopted under this section applies to the

granting of restricted prior service credit to a member who is or

has been an employee of the authorizing municipality at any time

on or after the effective date of the ordinance.

Added by Acts 1991, 72nd Leg., ch. 466, Sec. 1, eff. Aug. 26,

1991. Amended by Acts 1993, 73rd Leg., ch. 57, Sec. 5, 6, eff.

Jan. 1, 1994; Acts 1995, 74th Leg., ch. 514, Sec. 6, 7, eff.

Sept. 1, 1995; Acts 1997, 75th Leg., ch. 76, Sec. 2, eff. Sept.

1, 1997; Acts 2001, 77th Leg., ch. 121, Sec. 7, eff. Jan. 1,

2002; Acts 2003, 78th Leg., ch. 599, Sec. 7, eff. Jan. 1, 2004.

SUBCHAPTER E. OPTIONAL INCREASES IN SERVICE CREDITS

Sec. 853.401. ORDINANCE AUTHORIZING UPDATED SERVICE CREDITS.

(a) Except as provided by Subsection (b), the governing body of

a participating municipality by ordinance may authorize the

crediting in the retirement system of updated service credits for

service performed for the municipality by members. An updated

service credit authorized under this section replaces any updated

service credit or prior service credit previously authorized for

part of the same service.

(b) A municipality may not authorize updated service credits for

members who had less than 36 months of credited service on the

date prescribed by Section 853.402(e).

(c) In adopting an ordinance under this section, a governing

body shall specify the percentage of base updated service credits

to be used in computing updated service credits for employees of

the municipality and shall specify the date the updated service

credits will take effect. The percentage adopted may be 50

percent, 75 percent, or 100 percent of a base updated service

credit. The effective date must be January 1 of a year specified

by the governing body. If the governing body of a municipality

has specified a different percentage in an ordinance adopted

under Section 853.404(a) and in effect on December 31, 1999, the

percentage used in computing updated service credits for

employees of that municipality remains in effect until changed or

discontinued under Section 853.404.

(d) A governing body that adopts an ordinance under this section

shall send it to the retirement system, and the system must

receive it before the effective date of the updated service

credits authorized in the ordinance.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Amended by Acts 1981, 67th Leg., 1st C.S., p. 221, ch. 18,

Sec. 77, eff. Jan. 1, 1982. Renumbered from Vernon's Ann.Civ.St.

Title 110B, Sec. 63.401 and amended by Acts 1989, 71st Leg., ch.

179, Sec. 1, eff. Sept. 1, 1989. Amended by Acts 1993, 73rd Leg.,

ch. 57, Sec. 7, eff. Jan. 1, 1994; Acts 1999, 76th Leg., ch. 83,

Sec. 3, eff. Dec. 31, 1999.

Sec. 853.402. DETERMINATION OF UPDATED SERVICE CREDITS. (a) If

a governing body sends the retirement system an ordinance adopted

under Section 853.401, the retirement system shall determine for

each affected member the average updated service compensation,

base updated service credit, and updated service credit.

(a-1) The board of trustees by rule may limit the increase in a

member's average updated service compensation from year to year.

(b) The average updated service compensation of a member is

computed as the monthly average compensation:

(1) for the 36 months immediately preceding the date prescribed

by Subsection (e); or

(2) if the member did not perform service in each of the 36

months described in Subdivision (1) or did not perform any

service within the 36-month period, for the most recent 36 months

before the date prescribed by Subsection (e) in which the member

performed service.

(c) The base updated service credit of a member is an amount

computed as the number 1.03, times the difference by which the

amount computed under Subdivision (1) exceeds the amount computed

under Subdivision (2), where:

(1) "(1)" is an amount equal to the accumulation at three

percent interest of a series of monthly amounts for the number of

months of credited service on the date prescribed by Subsection

(e), each amount of which equals the member's average updated

service compensation, times the sum of:

(A) the rate of contributions required of the member for current

service; plus

(B) the member's contribution rate, times the municipal current

service ratio in effect on the effective date of the ordinance

adopted under Section 853.401; and where

(2) "(2)" is an amount equal to the sum of:

(A) the amount credited to the member's individual account in

the employees saving fund on the date prescribed by Subsection

(e), subject to a 1 to 1 matching ratio, times 2; plus

(B) the amount credited to the member's individual account,

subject to a 1.5 to 1 matching ratio, times 2.5; plus

(C) the amount credited to the member's individual account,

subject to a 2 to 1 matching ratio, times 3.

(d) The updated service credit of a member is an amount equal to

the greatest of the following:

(1) the percentage determined under Section 853.401(c), times

the member's base updated service credit; or

(2) any updated service credit previously authorized by the

municipality and in effect for the member, accumulated at

interest as provided by Subsection (f) from the date it took

effect to the date prescribed by Subsection (e); or

(3) prior service credit previously authorized by the

municipality and in effect for the member, accumulated at

interest as provided by Subsection (f) from the date the credit

took effect to the date prescribed by Subsection (e).

(e) The date used in computing updated service compensation and

updated service credits under this section is January 1 of the

year immediately preceding the January 1 on which the updated

service credits will take effect.

(f) Interest on an updated service credit is earned for each

whole calendar year beginning on the date the updated service

credit takes effect and ending on the effective date of

retirement. If a person retires under this subtitle on a date

other than December 31, interest on an updated service credit is

earned for the partial year in which the retirement occurs,

prorated from January 1 of the year in which the retirement

occurs to the effective date of retirement.

(g) Repealed by Acts 2007, 80th Leg., R.S., Ch. 293, Sec. 5,

eff. September 1, 2007.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Renumbered from Vernon's Ann.Civ.St. Title 110B, Sec.

63.402 and amended by Acts 1989, 71st Leg., ch. 179, Sec. 1, eff.

Sept. 1, 1989; Acts 1993, 73rd Leg., ch. 57, Sec. 8, eff. Jan. 1,

1994. Amended by Acts 1999, 76th Leg., ch. 83, Sec. 4, eff. Dec.

31, 1999; Acts 2001, 77th Leg., ch. 121, Sec. 8, eff. Jan. 1,

2002.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

293, Sec. 2, eff. January 1, 2008.

Acts 2007, 80th Leg., R.S., Ch.

293, Sec. 5, eff. September 1, 2007.

Sec. 853.403. APPROVAL OF ORDINANCE. (a) An ordinance adopted

under Section 853.401 may not take effect unless the board of

trustees approves the ordinance as meeting the requirements of

this section. The board may not approve an ordinance unless the

actuary first determines, and the board concurs in the

determination, that all obligations charged against the

municipality's account in the municipality accumulation fund,

including obligations proposed in the ordinance, can be funded by

the municipality within its maximum total contribution rate and

within its amortization period as in effect on the date the

updated service credits take effect.

(b) The board of trustees may adopt rules it finds necessary to

ensure that the retirement system receives in a timely manner

from a municipality the certified information the actuary

requires to make the necessary determinations before the date the

updated service credits take effect.

Acts 1981, 67th Leg., p. 1876, ch. 453, Sec. 1, eff. Sept. 1,

1981. Amended by Acts 1981, 67th Leg., 1st C.S., p. 222, ch. 18,

Sec. 78, eff. Jan. 1, 1982. Renumbered from Vernon's Ann.Civ.St.

Title 110B, Sec. 63.403 and amended by Acts 1989, 71st Leg., ch.

179, Sec. 1, eff. Sept. 1, 1989. Amended by Acts 1997, 75th Leg.,

ch. 76, Sec. 3, eff. Sept. 1, 1997.

Sec. 853.404. ALLOWANCE OF UPDATED SERVICE CREDIT AND ANNUITY

INCREASES. (a) The governing body of a participating

municipality that adopts an ordinance authorizing the crediting

in the retirement system of updated service credits under

Sections 853.401, 853.402, and 853.403, to be effective January 1

of a designated year, may further provide in the ordinance that

updated service credits will be credited effective January 1 of

each year following the designated year, using the same

percentage of the base updated service credit specified in the

ordinance in computing updated service credits for each future

year, until changed or discontinued as provided by this section.

(b) The governing body of a participating municipality that

adopts an ordinance under Section 853.601, authorizing the

crediting of updated service credits for transferred service

effective January 1 of a designated year, may further provide in

the ordinance that updated service credits will be credited

effective January 1 of each year following the designated year,

using the same percentage of the base updated service credit

specified in the ordinance in computing updated service credits

for each future year, until changed or discontinued as provided

by this section.

(c) The governing body of a participating municipality that

adopts an ordinance under Section 854.203 providing for increased

annuities effective January 1 of a designated year may further

provide in the ordinance that increases in annuities will be

credited effective January 1 of each year following the

designated year based on recomputations made as provided by

Section 854.203(b)(1) for each year following the initial

computation, and using the fraction specified in the ordinance as

required under Section 854.203(b)(2) in the recomputations.

(d) Except as provided by Subsection (e), an ordinance under

this section continues in effect for each year that the actuary

determines that all obligations charged against the

municipality's account in the municipality accumulation fund,

including the obligations to become effective the next January 1,

can be funded by the municipality within its maximum contribution

rate and within its amortization period as in effect on the next

January 1. An ordinance under this section will cease to be in

effect for future years if the actuary cannot make that

determination, but shall again take effect for future years

beginning January 1 of the first year after the actuary can make

that determination.

(e) An ordinance under this section ceases to be in effect for

future years if the municipality:

(1) adopts a new ordinance under this section;

(2) adopts a new matching ratio for matching a member's future

contributions and earnings on those contributions at the time of

retirement under Section 855.501;

(3) adopts a new rate of member contributions under Section

855.401; or

(4) adopts an ordinance stating that the ordinance in effect

under this section will cease to be in effect for future years.

Added by Acts 1991, 72nd Leg., ch. 466, Sec. 2, eff. Aug. 26,

1991. Amended by Acts 1995, 74th Leg., ch. 514, Sec. 8, eff.

Sept. 1, 1995; Acts 1997, 75th Leg., ch. 76, Sec. 4, eff. Sept.

1, 1997.

SUBCHAPTER F. MILITARY SERVICE

Sec. 853.501. MILITARY SERVICE BY MEMBER. (a) A member of the

retirement system is allowed credited service as provided in this

subchapter if at any time the person:

(1) leaves employment with a participating municipality to

perform and performs active duty service in the armed forces or

the armed forces reserves of the United States or their

auxiliaries, provided that:

(A) the person makes application for reemployment with the same

municipality within 90 days after the person is released from

active duty or discharged from such military service or from

hospitalization continuing after discharge for a period of not

more than one year; and

(B) the person is reemployed by the same participating

municipality; or

(2) is conscripted and leaves employment with a participating

municipality to perform and performs war-related service during a

state of war or during a conflict between the armed forces of the

United States and the armed forces of a foreign country, provided

that the person is reemployed by the same municipality within 90

days after the end of such service.

(b) Credit for service under this section may only be used as

set forth in Section 853.505.

Added by Acts 1989, 71st Leg., ch. 462, Sec. 4, eff. Sept. 1,

1989. Amended by Acts 1991, 72nd Leg., ch. 16, Sec. 11.01(d),

eff. Aug. 26, 1991.

Sec. 853.502. OTHER MILITARY SERVICE CREDIT. (a) The governing

body of a participating municipality by ordinance may authorize

eligible members in its employment to establish credit in the

retirement system for active military service performed as a

member of the armed forces or armed forces reserves of the United

States or their auxiliaries, for which service the members do not

receive credit under Section 853.501.

(b) A member eligible to establish credit for military service

creditable as provided by this section is one who is an employee

of a municipality that has adopted an ordinance under this

section and who:

(1) was an employee of a participating municipality immediately

prior to the military service, but terminated employment with the

municipality and membership in the retirement system during the

period of service, and applied for reemployment with the

municipality not later than the 90th day after the date the

person was released from active duty or discharged or from

hospitalization continuing after discharge for a period of not

more than one year, and was reemployed by that municipality; or

(2) has at least five years of credited service in the

retirement system and has been an employee of one or more

participating municipalities for at least five years.

Added by Acts 1981, 67th Leg., 1st C.S., p. 222, ch. 18, Sec. 79,

eff. Jan. 1, 1982. Amended by Acts 1989, 71st Leg., ch. 462, Sec.

4, eff. Sept. 1, 1989. Renumbered from Vernon's Ann.Civ.St. Title

110B, Sec. 63.501 and amended by Acts 1989, 71st Leg., ch. 179,

Sec. 1, eff. Sept. 1, 1989. Renumbered from Government Code, Sec.

853.501 and amended by Acts 1991, 72nd Leg., ch. 16, Sec.

11.01(d), eff. Aug. 26, 1991; Acts 2003, 78th Leg., ch. 599, Sec.

8, eff. Jan. 1, 2004.

Sec. 853.503. CONDITIONS FOR RECEIVING MILITARY SERVICE CREDIT.

No person can receive credit for service under this subchapter

unless:

(1) the person's military service was terminated by release from

active duty or discharge on terms not dishonorable;

(2) the person does not receive and is not eligible to receive

federal retirement payments based on 20 years or more of active

military service or its equivalent; and

(3) the person does not have and does not receive credit for the

service in any other public retirement system or program

established under laws of this state.

Added by Acts 1989, 71st Leg., ch. 462, Sec. 4, eff. Sept. 1,

1989. Amended by Acts 1991, 72nd Leg., ch. 16, Sec. 11.01(d),

eff. Aug. 26, 1991.

Sec. 853.504. ESTABLISHMENT OF MILITARY SERVICE CREDIT. (a) An

eligible member may establish credit under Section 853.501 by

filing written application therefor with the retirement system,

accompanied by satisfactory evidence of the member's military

service.

(b) An eligible member seeking military service credit under

Section 853.502 must file with the retirement system a written

application for the credit, together with satisfactory evidence

of the member's military service.

(c) No person may obtain credit under this subchapter for more

than 60 months of military service.

Added by Acts 1981, 67th Leg., 1st C.S., p. 222, ch. 18, Sec. 79,

eff. Jan. 1, 1982. Amended by Acts 1989, 71st Leg., ch. 462, Sec.

4, eff. Sept. 1, 1989. Renumbered from Vernon's Ann.Civ.St. Title

110B, Sec. 63.502 and amended by Acts 1989, 71st Leg., ch. 179,

Sec. 1, eff. Sept. 1, 1989. Renumbered from Government Code, Sec.

853.502 and amended by Acts 1991, 72nd Leg., ch. 16, Sec.

11.01(d), eff. Aug. 26, 1991; Acts 2003, 78th Leg., ch. 599, Sec.

9, eff. Jan. 1, 2004.

Sec. 853.505. USE OF MILITARY SERVICE CREDIT. (a) The

retirement system shall use military service credit established

under this subchapter in determining length-of-service

requirements for benefits.

(b) Except as provided by Section 853.506, military service

credit allowed under Section 853.501 shall have no monetary value

in calculating the annuity payments allowable to the member and

shall not be used in other computations, including computation of

updated service credits or prior service credits.

(c) When a person who has military service credit under Section

853.502 retires, the retirement system shall transfer to the

current service annuity reserve fund the accumulated amount paid

by the person under Section 853.504(b) and an amount from the

municipality account in the municipality accumulation fund equal

to the accumulated amount paid by the person times the

municipality's current service matching percent in effect on the

date the member applies for credit under Section 853.504(b). The

retirement system shall use the amounts to make annuity payments

to the person computed in the same manner as is the person's

current service annuity, but the credit and the amounts may not

be used in other computations, including computations of updated

service credits or prior service credits.

Added by Acts 1981, 67th Leg., 1st C.S., p. 222, ch. 18, Sec. 79,

eff. Jan. 1, 1982. Amended by Acts 1989, 71st Leg., ch. 462, Sec.

4, eff. Sept. 1, 1989. Renumbered from Vernon's Ann.Civ.St. Title

110B, Sec. 63.503 and amended by Acts 1989, 71st Leg., ch. 179,

Sec. 1, eff. Sept. 1, 1989. Renumbered from Government Code, Sec.

853.503 and amended by Acts 1991, 72nd Leg., ch. 16, Sec.

11.01(d), eff. Aug. 26, 1991. Amended by Acts 1997, 75th Leg.,

ch. 76, Sec. 5, eff. Sept. 1, 1997.

Sec. 853.506. CURRENT SERVICE FOR REEMPLOYED VETERANS.

Notwithstanding any provision of this subtitle to the contrary,

contributions, benefits, and service credit for qualified

military service will be provided in accordance with Section

414(u) of the Internal Revenue Code of 1986 (26 U.S.C. Section

414). The board of trustees may adopt rules that modify the terms

of this subtitle for the purpose of compliance with the Uniformed

Services Employment and Reemployment Rights Act (38 U.S.C.

Section 4301 et seq.).

Added by Acts 1997, 75th Leg., ch. 76, Sec. 6, eff. Sept. 1,

1997.

SUBCHAPTER G. OPTIONAL UPDATED SERVICE CREDIT FOR TRANSFERRED

SERVICE

Sec. 853.601. ORDINANCE AUTHORIZING UPDATED SERVICE CREDIT FOR

TRANSFERRED SERVICE. (a) The governing body of a participating

municipality in ordinances authorizing updated service credits

under Section 853.401 on or after January 1, 1984, may provide

that those members who are eligible for such credits on the basis

of service with the granting municipality, who have unforfeited

credit for prior service or current service with another

participating municipality or municipalities by reason of

previous employment, and who are contributing members on the date

prescribed by Section 853.402(e), shall be credited in the

retirement system with updated service credit calculated in the

manner prescribed by Sections 853.401 and 853.402, except that in

determining the base updated service credit of the member under

Section 853.402(c)(1), all unforfeited credited service performed

by the member by reason of previous employment in other

participating municipalities prior to the date prescribed by

Section 853.402(e) shall be treated as if performed in the

service of the municipality adopting the ordinance, and that

amount shall be reduced by an amount equal to the sum of:

(1) 2 times the amount credited to the member's individual

accounts in the employees saving fund on the date prescribed in

Section 853.402(e), which any participating municipality has

undertaken to match on a 1 to 1 ratio; plus

(2) 2.5 times the amount credited to the member's individual

accounts, subject to a 1.5 to 1 matching ratio by any

participating municipality; plus

(3) 3 times the amount credited to the member's individual

accounts, subject to a 2 to 1 matching ratio by any participating

municipality; and plus

(4) the sum of all updated service credits, prior service

credits, special prior service credits, and antecedent service

credits allowed to the member by any other participating

municipality by which the member was previously employed and to

which the member is entitled.

(b) If the member is granted an updated service credit by a

previously employing municipality on or after the granting of an

updated service credit under Subsection (a), the updated service

credit granted under Subsection (a) shall be reduced by the

amount of increase in credits resulting from the granting of

updated service credits by the previous employer.

Added by Acts 1983, 68th Leg., p. 2977, ch. 512, Sec. 1, eff.

Aug. 29, 1983. Renumbered from Vernon's Ann.Civ.St. Title 110B,

Sec. 63.601 and amended by Acts 1989, 71st Leg., ch. 179, Sec. 1,

eff. Sept. 1, 1989.