Part 3.
TEACHER RETIREMENT SYSTEM OF TEXAS
Chapter 25.
MEMBERSHIP CREDIT
Subchapter B. COMPENSATION
34 TAC §25.34
The Teacher Retirement System of Texas (TRS) proposes a new §25.34,
concerning the administration of membership waiting period for public education
employees. The proposed new section implements a waiting period before an
individual is eligible to become a member of TRS. The proposal has been adopted
on an emergency basis and is published in this issue of the
Texas Register
.
In accordance with House Bill 3459, 78th Legislature, Regular Session,
the proposed new section sets forth the requirement of a 90-day waiting period
for an individual who is not a member of TRS, including through withdrawal
of contributions, if the individual is employed on or after September 1, 2003,
by an entity otherwise required to report its employees to TRS as members.
The proposed new section sets forth the eligibility for TRS membership for
individuals who are subject to the waiting period; describes the date of employment
for the purpose of administering the section; establishes how the waiting
period is calculated, and addresses the effect of the waiting period on eligibility
to elect participation in the Optional Retirement Program ("ORP") as an alternative
to membership in TRS.
Tony Galaviz, Chief Financial Officer, has determined that for each year
of the first five years the proposed section will be in effect, there will
be negligible fiscal implications to state or local governments as a result
of enforcing or administering the section as proposed. There will be no measurable
effect on local employment or the local economy as a result of the proposal.
Any economic costs to local governments required to comply with the proposed
new rule are the result of the legislative enactment of House Bill 3459, 78th
Legislature, Regular Session.
Mr. Galaviz has also determined that the public benefit will be to provide
notice and clarification to employers of the provisions relating to the 90-day
membership waiting period for affected employees. He has also determined that
there will be no anticipated economic cost to the public, small businesses,
or to the persons who are required to comply with the section as proposed
for each year of the first five years the section will be in effect.
Comments may be submitted in writing to Charles L. Dunlap, Executive Director,
1000 Red River, Austin, Texas 78701. To be considered, written comments must
be received by TRS no later than 30 days after publication of the sections
for proposal.
The new section is proposed under the Government Code, Chapter
825, §825.102, which authorizes the Board of Trustees of the Teacher
Retirement System to adopt rules for eligibility for membership. The new section
is also proposed under House Bill 3459, 78th Legislature, Regular Session,
sections 43-44 and 73-74, which require a waiting period and otherwise address
implementation of the waiting period.
The other code provisions affected are Government Code, Chapter 822, §822.001
and Government Code, Chapter 823, §823.002.
§25.34.Administration of Membership Waiting Period.
(a)
For an individual who begins employment on or after September
1, 2003, with an employer that is a TRS reporting entity and who is not a
member of TRS as of the date of employment, eligibility for TRS pension plan
membership begins on the first calendar day after the end of a 90 calendar
day waiting period.
(b)
For purposes of this section, an individual who is not
considered to be a TRS member includes an individual who previously terminated
membership in the retirement system through withdrawal of contributions and
did not resume membership prior to a date of employment that is on or after
September 1, 2003.
(c)
In determining the date of eligibility for TRS pension
plan membership for an employee who is subject to the waiting period, the
following provisions apply:
(1)
An employer shall count the date of employment as the first
day of the 90-day waiting period.
(2)
An employer shall count calendar days of an employment
period on or after September 1, 2003, towards the waiting period, regardless
of whether the days are in different school years.
(3)
An employer shall count calendar days on or after September
1, 2003, during which the individual previously served as an employee with
another TRS reporting entity towards the waiting period.
(4)
An employer shall not count any calendar days between periods
of employment towards the waiting period.
(5)
Service provided by an employee on one calendar day to
more than one employer that is a TRS reporting entity shall count as only
one calendar day in the waiting period. Service of a type that would not otherwise
qualify the employee for TRS membership may not fulfill any part of the waiting
period requirement.
(d)
For the purpose of administering this section, the date
of employment means the date on which an employee begins to perform service
for an employer that is a TRS reporting entity and the service is of a type
that would otherwise qualify the employee for membership in the TRS pension
plan, as provided under Subchapter A of this chapter (relating to Service
Eligible for Membership) if the person were not subject to the waiting period
described in this section.
(e)
An employer shall submit member and other required contributions
to TRS on compensation paid to an employee after the first date of the employee's
eligibility for membership. For an employee subject to the waiting period,
an employer's first report to TRS for the employee shall include the date
of employment and the date on which the employee became eligible for TRS membership
after the waiting period.
(f)
An employer shall notify TRS immediately if it has failed
to report an employee who was eligible for TRS membership and shall begin
to report the employee as a member no later than the month immediately following
the month in which the employer discovered the error. The employer shall correct
any previous reports filed with TRS and make contributions and deposits as
required by this title.
(g)
Because participation in the Optional Retirement Program
("ORP") under Government Code, Chapter 830, is in lieu of participation in
TRS, a person employed on or after September 1, 2003, and otherwise eligible
to elect to participate in ORP must meet the TRS membership eligibility requirements,
including the waiting period as applicable under this section, before the
person may elect to participate in ORP. An election to participate in ORP
must be made before the 91st day after becoming eligible to make the election,
as required by Government Code, Chapter 830, §830.102, but may not be
made before the date on which an employee is eligible for TRS membership.
(h)
Upon request by TRS, an employer or an employee shall provide
copies of, or otherwise make available, any records that TRS determines are
necessary to administer this section.
(i)
An employee who is subject to the waiting period specified
in this section may be eligible to receive a year of TRS service credit if
the employee is employed in a TRS-covered position and participates as a contributing
member of TRS for the amount of time in a school year required by this title,
including §25.1 of this title (relating to Full-Time Service) and §25.131
of this title (relating to Required Service). Employment service prior to
the date on which a person is eligible for TRS membership under this section
may not be used to meet the minimum requirements for service creditable in
a school year unless a member purchases it in accordance with applicable requirements.
(j)
This section is effective on September 1, 2003, and expires
September 1, 2005, unless legislation is enacted extending the provisions
of Government Code, Chapter 822, §822.001 and Government Code, Chapter
823, §823.002, as amended by House Bill 3459, 78th Legislature.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on August 8, 2003.
TRD-200304891
Charles Dunlap
Executive Director
Teacher Retirement System of Texas
Proposed date of adoption: September 25, 2003
For further information, please call: (512) 542-6115
Chapter 53.
CERTIFICATION BY COMPANIES OFFERING QUALIFIED INVESTMENT PRODUCTS