| (a) Purpose. These rules are intended to implement
the provisions of the Government Code, Chapter 805, concerning the
transfer of credit between the Teachers Retirement System of Texas
and the Employees Retirement System of Texas and to provide a systematic
method of funding the actuarial value of the annuity resulting from
transferred service.
(b) Definitions. The following words and terms, when
used in this section, shall have the following meanings, unless the
context clearly indicates otherwise.
(1) Receiving system--The system which will pay benefits
based upon service credit transferred from the other system.
(2) Transferring system--The system from which service
credit is transferred for the purpose of obtaining additional benefits
from the other system.
(3) TRS--The Teacher Retirement System of Texas.
(4) ERS--The Employees Retirement System of Texas.
(5) Crediting system--means the system in which service
credit is established prior to any transfer.
(6) ORP--The Optional Retirement Program described
in Government Code, Chapter 830.
(c) Forms.
(1) Applicants for transfer must use forms prescribed
by the receiving system.
(2) Applicants for the establishment of any service
credit must use the forms prescribed by the crediting system.
(3) The systems will cooperate in adopting forms necessary
to facilitate the exchange of information between the systems.
(d) Notice.
(1) A person electing to transfer service credit pursuant
to this section must file the appropriate form with the receiving
system not later than the person's intended effective date of retirement
or the last day of the month in which their retirement application
is filed, whichever is later.
(2) A beneficiary eligible to transfer service to the
receiving system for the payment of death benefits shall make the
election on an application form not later than 90 days after the date
of death of the member, unless both systems agree to extend the deadline
for an election, but in any event the beneficiary shall make the election
before either system has paid the death benefit.
(3) The receiving system will notify the transferring
system of the pending transfer not later than 30 days following date
of receipt of an application form.
(e) Manner of Transfer.
(1) Service credit and funds will be transferred through
electronic and hard copy documentation pursuant to this section, and
the receiving system will maintain records of such transfers permanently.
(2) The transferring system shall provide documentation
of years of credit, periods of service, military service credit, average
salary, method of calculation of service credit and average salary,
information necessary to comply with all federal tax regulations,
interest credited, fees and interest paid, and any other dollar amount
which will be a part of the transfer.
(f) Transfer of funds. The ERS and the TRS agree on
the following method of transferring funds. Each system shall certify
on a monthly basis the total dollar amount of annuities paid by the
system which are based on service credit transferred pursuant to Government
Code, Chapter 805. The amount certified shall exclude any portion
of annuities paid consisting of post-retirement increases. Each system
shall remit to the other system the amount certified within thirty
days of receipt of such certification. It is recognized that adjustments
will be made from month-to-month as a result of such things as administrative
errors, the death of the annuitant or a beneficiary, return-to-work,
and recovery from disability by an annuitant. The systems will jointly
agree on the administrative and accounting procedures to be established
in order to ensure the transfer of funds pursuant to this section.
(g) Reinstatement of withdrawn service credit.
(1) An ERS member with at least 36 months service credit
in ERS may reinstate service credit in TRS that was canceled by the
person's withdrawal of a TRS membership account.
(2) Such reinstatement of TRS credit shall be in the
amounts and rates applicable to TRS members eligible to repurchase
such credit.
(3) A TRS member with three years' service credit may
reinstate, through ERS, service credit canceled by withdrawal of an
ERS membership account.
(4) No service credit may be transferred based in whole
or in part upon reinstated credit under this section unless the applicant
meets all conditions for membership, amount of service credit, and
payments required for the reinstatement of the credit.
(5) Any TRS membership service credit reinstated under
this subsection may be applied toward the service credit requirements
of TRS laws and rules for the purchase of out-of-state, military or
other special service credit.
(h) Termination of membership. The transfer of TRS
service credit to ERS will terminate TRS membership and cancel all
rights to benefits from TRS based on that service.
(i) Service in the month following retirement. Both
TRS and ERS laws require a separation from employment with any employer
covered by the respective system for a period following a member's
effective retirement date as a condition for retirement with a benefit
from the respective system. A member retiring under TRS whose last
place of employment is with an ERS-covered employer shall provide
a certification of termination of employment to TRS in the manner
directed by the retirement system, specifying the last date of employment.
With respect to a service or disability retirement by persons using
credit transferred between the systems, the following provisions apply:
(1) An ERS retiree whose last place of employment is
with a TRS-covered employer must be off the payroll of any TRS-covered
employer for the first full calendar month following retirement under
ERS, or the ERS retirement will be canceled. A TRS retiree whose last
place of employment is with an ERS-covered employer must be off the
payroll of any ERS-covered employer for the first full calendar month
following retirement under the TRS, or the TRS retirement will be
canceled.
(2) An ERS retiree whose last place of employment is
with an ERS-covered employer may begin work for a TRS-covered employer
after retirement under ERS without a one month break in service. A
retiree from the TRS whose last place of employment is with a TRS-covered
employer may begin work for an ERS-covered employer after retirement
under TRS without a one month break in service.
(j) Average salary.
(1) In determining average salary used in computing
benefits available to a person transferring credit under this section,
the receiving system will use the higher of the average salary derived
solely from the service originally established in each system respectively.
In comparing average salaries and determining benefits payable, the
receiving system shall accept the transferring system's determination
of its average salary, applying all laws and policies of the transferring
system in the calculation of that system's average salary.
(2) Each system will be responsible for determining
its respective average salary. The transferring system will certify
its average salary to the receiving system.
(3) If there is less service than is required in the
applicable formula to compute the average salary in TRS under the
laws and rules applicable to that system, the average salary will
be computed using salaries for the service for which credit was established.
This average salary shall be used in the comparison of average salaries
to determine which system's average salary is higher.
(k) Transfer of Certain State Employees to ERS.
(1) Certain state employees have been transferred to
ERS membership as a result of legislation enacted by the 73rd Texas
Legislature, Regular Session. Among these are employees of the Texas
Education Agency, employees of the Texas Surplus Property Agency transferred
to the General Services Commission, some employees of the Texas Rehabilitation
Commission, the Texas School for the Deaf, the Texas School for the
Blind, the Higher Education Coordinating Board, and the Texas Youth
Commission. Such employees are eligible to transfer TRS credit to
ERS for benefit purposes under the Government Code, Chapter 805 subject
to the modifications contained in this section.
(2) Employees whose agencies have been transferred
to ERS coverage, including the Texas Education Agency and the Texas
Rehabilitation Commission, the Texas School for the Deaf, the Texas
School for the Blind, the Higher Education Coordinating Board, and
the Texas Youth Commission, may not retire under TRS after the effective
date of the transfer, unless they again become TRS members based on
other employment and subsequently obtain TRS service credit qualifying
them for TRS retirement, except as provided for in Government Code, §805.002(a).
(3) Employees described in paragraph (1) of this subsection
are not eligible for TRS death benefits other than a return of accumulated
contributions.
(4) Notwithstanding subsection (j) of this section,
the average compensation of employees described in paragraph (1) of
this subsection qualifying for ERS benefits may be determined by combining
monthly rates of pay while a TRS member with ERS credited monthly
salary to obtain the highest 36 months of pay.
(l) Death benefits. Service credit of a person may
not be transferred between systems if:
(1) one of the systems has paid or begun to pay death
benefits based on the person's account; or
(2) the beneficiaries for death benefits in each system
are not identical. However, when only reinstated service is being
transferred and no beneficiary designation was made at or after the
time of reinstatement, a transfer will be allowed.
(m) Service credit.
(1) TRS will make and accept transfers of service credit
in whole plan year increments based upon TRS rules for crediting service.
No partial years will be transferred.
(2) TRS and ERS service in a plan year will not be
combined to obtain a year of TRS service credit.
(3) A person who transfers credit to TRS or ERS may
not receive more than a total of five years of service credit for
military service. The retirement system from which credit is transferred
may refund contributions made for military service, other than any
amount that represents a fee, that exceeds the maximum amount creditable.
A person who retires under Government Code, Chapter 805, who returns
to work under TRS or ERS may not purchase additional military service
credit if the purchase would cause the total of all military service
credit to exceed five years.
(4) A person who purchased out of state service credit
before retirement under Government Code, Chapter 805, may not purchase
additional out of state service credit upon return to work under TRS
if the purchase would cause the total of all out of state service
credit to exceed fifteen years.
(n) ORP participants. A person who has elected to participate
in ORP but who is an ERS member may repurchase TRS service credit
canceled by the election of ORP for purpose of transferring it to
ERS under the Government Code, Chapter 805, provided TRS will not
transfer or pay benefits for such service credit if the member actively
participates in ORP between the date the TRS service credit is purchased
and the date of the member's retirement or death. TRS will refund
without interest any amounts deposited for such credit in the event
the person returns to active ORP participation. The person must agree
to refund the amount of any benefits erroneously paid to the person
as a result of any such return to ORP.
(o) Return to TRS covered employment.
(1) A person who transferred service to ERS and retired
under Government Code, Chapter 805, and who returns to employment
in a position eligible for TRS membership continues to be governed
by the provisions of state law as described under §51.12(a) of
this title (relating to Applicability of Certain Laws in Effect Before
September 1, 2005) upon resumption of TRS membership, if, while a
member of TRS, the person met at least one of the requirements of §51.12(a)
of this title by August 31, 2005.
(2) Regardless of status under paragraph (1) of this
subsection, a person who transferred service to ERS and retired under
Government Code, Chapter 805, and who returns to employment in a position
eligible for TRS membership after August 31, 2007, is subject to the
provisions of Government Code §824.202(a-1) and (d-1) and §29.1(a)
of this title (relating to Eligibility for Service Retirement) for
eligibility for retirement under TRS.
(3) A person who has at least five years of TRS service
credit on August 31, 2014 and transfers that service credit to ERS,
retires from ERS under Government Code, Chapter 805, and returns after
September 1, 2014 to employment in a position eligible for TRS membership
is subject to the provisions of Government Code §824.202(a-2),
(b-2), and (d-2) and §29.1(e) of this title (relating to Eligibility
for Service Retirement).
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| Source Note: The provisions of this §25.113 adopted to be effective January 12, 1994, 19 TexReg 86; amended to be effective April 22, 1994, 19 TexReg 2549; amended to be effective June 15, 1999, 24 TexReg 4458; amended to be effective February 15, 2000, 25 TexReg 1124; amended to be effective March 12, 2003, 28 TexReg 2097; amended to be effective April 28, 2004, 29 TexReg 3968; amended to be effective March 8, 2007, 32 TexReg 1079; amended to be effective April 1, 2011, 36 TexReg 1834; amended to be effective July 17, 2014, 39 TexReg 5431 |
