Resolution amending City's Legislative Program, add HB1756

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Vanessa Sarria
Posts: 29
Joined: Tue Feb 03, 2015 4:47 pm

Resolution amending City's Legislative Program, add HB1756

Post by Vanessa Sarria » Wed Mar 25, 2015 11:23 am

The Mayor's Office is proposing to add the following resolution for consideration at the April 2 City Council meeting:

Approve a resolution amending City’s Legislative Program for the 84th Legislature to support House Bill 1756 which makes technical corrections and adjustments to the state statute that governs the Austin Firefighters Relief and Retirement Fund.

BACKGROUND INFORMATION

Dear Fellow City Council Members:

By way of introduction, the Austin Firefighters Relief and Retirement Fund operates under a state statute that only pertains to the Austin firefighters. The police officers’ pension fund also operates under their own statute (APRS) as do the “non-uniformed” municipal employees (COA-ERS). By their statute, the Austin firefighters’ pension board is comprised of five (5) trustees. The Mayor serves as the Chair and the City Treasurer serves as the Secretary-Treasurer, and three (3) firefighter trustees also serve on the board from which a Vice-Chair is elected each year.

The Austin Fire Fighters Relief and Retirement Fund pension board has introduced legislation for this 84th Session. HB 1756, co-authored by Representatives Eddie Rodriguez and Paul Workman, has been filed at the legislature. This bill only affects and pertains to the Austin firefighters and their governing statute under which they operate. The bill does not affect benefits and only includes necessary adjustments for proper administration and maintenance of the fund. A copy of the proposed bill is attached along with a summary and some fund facts.

HB 1756 will have no fiscal impact on the City of Austin, the State of Texas, or to the plan itself; as certified by the plan’s actuary. HB 1756 has the full support of the pension board of trustees, the Austin Retired Fire Fighters’ Association, and the Austin Professional Fire Fighters Association. The pension board of trustees took action at their meeting on February 17, 2015 officially supporting this legislation and is now seeking the support of HB 1756 from the Austin City Council.

Thank you for your consideration on this matter. If you have any questions or if I can be of further assistance, please let me know.

Sincerely,

Mayor Steve Adler, Chair
Austin Fire Fighters Relief and
Retirement Fund


PROPOSED RESOLUTION:

RESOLUTION NO._________________ (DRAFT)


WHEREAS, the Austin Firefighters Relief and Retirement Fund (the Fund) is a defined benefit plan the creation of which was authorized by the Texas Legislature in 1937; and

WHEREAS, the Fund provides retirement, disability, death and survivor benefits to approximately 1,700 active and retired participants and their eligible beneficiaries; and

WHEREAS, the Fund is administered by a five member Board of Trustees pursuant to State statue, and the City of Austin maintains a presence on this Board with the Mayor serving as the Chair of the Board of Trustees; and

WHEREAS, from time to time, it is necessary to update the state statute that governs the Fund to make technical corrections and adjustments through the passage of legislation; and

WHEREAS, House Bill 1756, co-authored by Representatives Eddie Rodriguez and Paul Workman, has been filed in the 84th Legislature to address the necessary changes to the Fund; and

WHEREAS, both the Austin Retired Fire Fighters Association and the Austin Firefighters Association, Local 975, have written letters expressing support for House Bill 1756; and

WHEREAS, the changes outlined in House Bill 1756 do not present an undue financial hardship on the City; and

WHEREAS, City Council support of this type of legislation communicates to Austin’s elected Representatives and Senators at the Texas Capitol that there is sufficient support to make necessary adjustments for proper administration and maintenance of the Fund, NOW, THEREFORE,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF AUSTIN:

That the City’s Legislative Program for the 84th Legislature is hereby amended to support House Bill 1756, co-authored by Representatives Eddie Rodriguez and Paul Workman.

ADOPTED: _________________, 2015 ATTEST: __________________________
Jannette Goodall
City Clerk



BACKUP from: Austin Fire Fighters Relief And Retirement Fund:
HB 1756 Summary
The Austin Fire Fighter’s Relief and Retirement Fund (the “Fund”) supports HB 1756 which will address certain administrative issues and make technical “clean-up” changes with respect to the Fund’s governing statute, Article 6243e.1, Vernon’s Texas Civil Statutes (the “Statute”). HB 1756 only pertains to this Fund and its statutes. A summary description of HB 1756 follows:

• Section 1—Trustee Elections This would allow the Fund to avoid the expense and administrative burden of holding an election in the event only one individual is nominated for a Trustee position.

• Section 2—Beneficiary Designations This Statute amendment would allow the Board to adopt rules that establish requirements and procedures for beneficiary designations to ensure that such designations are properly administered and not a source of potential abuse in the future.

• Sections 3 and 4—Withdrawals from Account under Deferred Retirement Option Program A member may elect to participate in the deferred retirement option program and obtain a partial-lump sum benefit. This Statute amendment would provide the Board with the ability to modify the number of available withdrawals through rule and provide more clarity as to distributions to designated beneficiaries.

• Section 5—Basis for Cost-of-Living Adjustment This amendment would change the CPI-U data used for a possible cost-of-living adjustment to a 12 month period ending within four months prior to a COLA instead of the prior month, which is administratively impracticable.
City of Austin Fire Fighters Relief and Retirement Fund Facts
• Defined benefit plan established by the Legislature in 1937. Separate governing statute for Austin fire fighters established in 1975.

• Austin Mayor and City Treasurer are statutorily required to serve on the Fund’s five-member Board of Trustees, ensuring oversight of the fund for Austin taxpayers.

• City of Austin fire fighters do not participate in social security thus receive no social security benefits to supplement their retirement.

• As of December 31, 2014, there are 1026 active fire fighters and 671 retired fire fighters and beneficiaries that participate in the retirement fund.

• Average age at retirement is 52 with an average 26 years of service.

• No pension spiking allowed and no overtime figures into the pension benefit calculation.

• Plan is actuarially sound with an amortization period of 10.5 years and a funded ratio of 91.75%, one of the strongest in the state.

• Annual audits and actuarial valuations are conducted to monitor and maintain the financial and actuarial soundness of the plan.
Policy Initiative and Advancement Director
Office of the Mayor

Don Zimmerman
Posts: 168
Joined: Fri Jan 09, 2015 11:05 am

Re: Resolution amending City's Legislative Program, add HB1

Post by Don Zimmerman » Wed Mar 25, 2015 12:39 pm

Mr. Mayor and Council Members,
I'm requesting to be added as a co-sponsor for this Resolution regarding HB1756
Don Zimmerman
Council Member District 6 (northwest Austin)

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