PART 4. EMPLOYEES RETIREMENT SYSTEM OF TEXAS
CHAPTER 71. CREDITABLE SERVICE
The Employees Retirement System of Texas (ERS) adopts amendments to 34 TAC §71.29 and §71.31 concerning Creditable Service towards Retirement without changes to the proposed text as published in the April 17, 2009, issue of the Texas Register (34 TexReg 2446) and will not be republished.
An experience study conducted by the ERS actuary for pension matters resulted in recommended changes to assumptions that were approved by the ERS Board of Trustees ("Board") at the May 13, 2008 meeting. Actuarial tables and reduction factors were prepared using the new assumptions, and these tables and factors were approved by the Board at the February 24, 2009 meeting. These sections of the ERS rules are amended to update the rules for the various changes to actuarial tables and reduction factors resulting from the experience study and that have been approved by the Board.
Section 71.29 and §71.31, concerning Purchase of Additional Service Credit and Credit Purchase Option For Certain Waiting Period Service, are amended to reflect new assumptions based on the recent actuarial experience study and new actuarial tables and reduction factors calculated on these assumptions.
No comments were received regarding adoption of the amendments.
The amendments are adopted under the Texas Government Code §815.102 and §815.105 which provide authorization for the ERS Board of Trustees to adopt mortality, service and other tables necessary for the retirement system and to adopt rules for the retirement system.
This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of the Secretary of State on May 20, 2009.
TRD-200901978
Paula A. Jones
General Counsel and Chief Compliance Officer
Employees Retirement System of Texas
Effective date: June 9, 2009
Proposal publication date: April 17, 2009
For further information, please call: (512) 867-7416
The Employees Retirement System of Texas (ERS) adopts amendments to 34 TAC §73.11 and §73.21 concerning Benefits at Death or Retirement without changes to the proposed text as published in the April 17, 2009, issue of the Texas Register (34 TexReg 2447) and will not be republished.
An experience study conducted by the ERS actuary for pension matters resulted in recommended changes to assumptions that were approved by the ERS Board of Trustees ("Board") at the May 13, 2008 meeting. Actuarial tables and reduction factors were prepared using the new assumptions, and these tables and factors were approved by the Board at the February 24, 2009 meeting. These sections of the ERS rules are amended to update the rules for the various changes to actuarial tables and reduction factors resulting from the experience study and that have been approved by the Board.
Section 73.11 and §73.21, concerning the Supplemental Retirement Program and the Reduction Factors for Age and Retirement Option, are amended to reflect new assumptions based on the recent actuarial experience study and new actuarial tables and reduction factors calculated on those assumptions.
No comments were received regarding adoption of the amendments.
The amendments are adopted under the Texas Government Code §815.102 and §815.105 which provide authorization for the ERS Board of Trustees to adopt mortality, service and other tables necessary for the retirement system and to adopt rules for the retirement system.
This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of the Secretary of State on May 20, 2009.
TRD-200901979
Paula A. Jones
General Counsel and Chief Compliance Officer
Employees Retirement System of Texas
Effective date: June 9, 2009
Proposal publication date: April 17, 2009
For further information, please call: (512) 867-7416
The Employees Retirement System of Texas (ERS) adopts amendments to 34 TAC §§77.1, 77.11, and 77.21, concerning the Judicial Retirement System of Texas Plan One and the Judicial Retirement System of Texas Plan Two. Section 77.1 is adopted without changes to the proposed text as published in the April 17, 2009, issue of the Texas Register (34 TexReg 2449) and will not be republished. Nonsubstantive changes are being made to §77.11(b) and §77.21(d). The text of the rules will be republished.
An experience study conducted by the ERS actuary for pension matters resulted in recommended changes to assumptions that were approved by the ERS Board of Trustees ("Board") at the May 13, 2008 meeting. Actuarial tables and reduction factors were prepared using the new assumptions, and these tables and factors were approved by the Board at the February 24, 2009 meeting. These sections of the ERS rules are amended to update the rules for the various changes to actuarial tables and reduction factors resulting from the experience study and that have been approved by the Board.
Sections 77.1, 77.11 and 77.21, concerning Reduction Factors for Death before Age 65, Reduction Factors for Age and Retirement Options--Judicial Retirement System of Texas Plan One (JRS-I) and Judicial Retirement System of Texas Plan Two (JRS-II), and Purchase of Additional Service Credit, are amended to reflect new assumptions based on the recent actuarial experience study and new actuarial tables and reduction factors calculated on those assumptions.
No comments were received regarding adoption of the amendments.
The amendments are adopted under the Texas Government Code §§835.002, 840.002, and 840.005 which provide authorization for the ERS Board of Trustees to adopt mortality, service and other tables and factors necessary for the Judicial Retirement System of Texas Plan One and the Judicial Retirement System of Texas Plan Two and to adopt rules for such retirement systems.
§77.11.Reduction Factors for Age and Retirement Options--Judicial Retirement System of Texas Plan One (JRS-I) and Judicial Retirement System of Texas Plan Two (JRS-II).
(a) Tables for calculation of optional factors.
(1) The 1981 reduction factors for optional forms of retirement annuities are independent of the gender of the member and of the beneficiary and are based on the GA-51 male mortality table projected with Scale C to 1970 with an age set forward of one year for retiring members and an age set back of four years for beneficiaries. The interest assumption is 5.0%.
(2) The 1992 reduction factors for optional forms of retirement annuities are independent of the gender of the member and the beneficiary and are based on the 1983 group annuity mortality table. The interest rate assumption is 8.5%.
(3) The reduction factors adopted by the board on February 24, 2009, based on assumptions adopted by the board on May 13, 2008, for optional forms of retirement annuities are independent of the gender of the member and the beneficiary and apply to retirements effective on or after September 30, 2009. For retirements first effective prior to September 1, 2009, the previously adopted factors apply.
(4) Copies of these tables are available from the executive director of the Employees Retirement System of Texas at 18th and Brazos Streets, P.O. Box 13207, Austin, Texas 78711-3207. The option tables, along with the adjustments described in this subsection are adopted by reference and made a part of this rule for all purposes.
(b) Option factors. The 2009 reduction factors for optional annuities for service retirement, disability retirement, and death benefit plans under the JRS-I and JRS-II plans apply to retirements effective on or after September 1, 2009, and are those factors adopted by the board on February 24, 2009, based on assumptions adopted by the board on May 13, 2008. For retirements first effective prior to September 1, 2009, the previously adopted factors apply. All option factors have been developed by the actuaries and are adopted by reference subject to the limitations of this subsection. The reduction factors are available from the executive director of the Employees Retirement System of Texas at 18th and Brazos Streets, P.O. Box 13207, Austin, Texas 78711-3207.
(c) Formula for JRS-II reduction factors for death before age 65.
(1) A death benefit annuity of the Judicial Retirement System of Texas Plan Two on behalf of a member dying before age 65 while not eligible for an unreduced service retirement benefit is reduced for each whole or partial calendar month that occurs during the period from the date of death to the 65th birthday, including the months that contain the dates of death and birthday. For the first 120 months (ages 55-64), the annuity is reduced by one-third of 1.0% per month. For the next 60 months (ages 50-54), the annuity is reduced by one-fourth of 1.0% per month. For the next 60 months (ages 45-49), the annuity is reduced by one-sixth of 1.0% per month. For the next 120 months (ages 35-44), the annuity is reduced by one-twelfth of 1.0% per month.
(2) A death benefit annuity on behalf of a member dying before age 65 while eligible for an unreduced service retirement benefit shall not be reduced for age.
(3) JRS-II reduction factors for death before age 65 have been developed by the actuaries and are adopted by reference subject to the limitations of this subsection. The reduction factors that apply to deaths of members prior to age 65 and that occur on or after September 1, 2009, are those factors adopted by the board on February 24, 2009, based on assumptions adopted by the board on May 13, 2008. For deaths occurring prior to September 1, 2009, the previously adopted factors apply. The set of reduction factors is available from the executive director of the Employees Retirement System of Texas at 18th and Brazos Streets, P.O. Box 13207, Austin, Texas 78711-3207.
(d) Reserve factors. The reserve factors for JRS-II are adopted by reference and made a part of this rule for all purposes. The reserve factors apply to periods beginning on or after September 1, 2009, and are those factors adopted by the board on February 24, 2009, based on assumptions adopted by the board on May 13, 2008. For periods occurring prior to September 1, 2009, the previously adopted factors apply. Copies of these tables are available from the executive director of the Employees Retirement System of Texas at 18th and Brazos Streets, P.O. Box 13207, Austin, Texas 78711-3207.
(e) Dollar limitations for maximum annual benefit. Service retirement annuities shall conform to dollar limitations and applicable adjustments under the Internal Revenue Code of 1986, §415 (26 United States Code §415) as determined by the federal commissioner of internal revenue.
§77.21.Purchase of Additional Service Credit.
(a) The provisions of this section apply only to the Judicial Retirement System of Texas Plan Two (JRS-II).
(b) An eligible member may establish equivalent membership service credit authorized by §838.108, Texas Government Code, as provided in this section. The provisions of §77.15 of this title (relating to Payments to Establish or Reestablish Service Credit) do not apply to service credit established under this section.
(c) A member is eligible to establish service credit under this section in the membership class in which the member holds a position if the member:
(1) has 120 months of service credit for one or more periods of time during which the member held a position as a judge and the required contributions were made;
(2) is a member of the system at the time credit is established; and
(3) is not eligible to establish other credit or service.
(d) An eligible member shall deposit with the system in a lump sum a contribution in the amount determined by the system to be the actuarial present value of the benefit attributable to the credit established under this section. The tables recommended by the system's actuary and adopted by the board shall be used by the system to determine the actuarial present value. The 2009 additional service credit tables for JRS-II are adopted by reference and made a part of this rule for all purposes. The additional service credit tables apply to service purchase calculations performed on or after September 1, 2009, and are those tables adopted by the board on February 24, 2009, based on assumptions adopted by the board on May 13, 2008. For service purchase calculations performed prior to September 1, 2009, the previously adopted tables apply. Copies of these tables are available from the executive director of the Employees Retirement System of Texas at 18th and Brazos Streets, P.O. Box 13207, Austin, Texas 78711-3207.
(e) Actuarial present value shall be based on:
(1) the member's age on the date of the deposit required by this subsection;
(2) the earliest date on which the member will become eligible to retire and receive a service retirement annuity after establishing credit under this section; and
(3) the future employment, compensation, investment and retirement benefit assumptions recommended by the actuaries and adopted by the board.
(f) Credit shall be established in whole year increments of credit.
(g) A member who establishes credit under this section shall certify that the member is not eligible to establish other credit or service and shall waive any and all right to establish such credit or service that the member had on the date of the deposit required by subsection (d) of this section.
(h) Credit established under this section may not be used to compute the amount of a disability retirement annuity.
(i) A member who withdraws contributions and cancels credit established under this section may not reestablish such credit under §838.102, Texas Government Code, but may again establish credit as provided in this section.
This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of the Secretary of State on May 20, 2009.
TRD-200901981
Paula A. Jones
General Counsel and Chief Compliance Officer
Employees Retirement System of Texas
Effective date: June 9, 2009
Proposal publication date: April 17, 2009
For further information, please call: (512) 867-7416