(a) In this section, "Code" means the Internal Revenue
Code of 1986, as amended.
(b) Effective September 1, 2019, the 86th Texas Legislature
adopted H.B. 3247 which amended §862.002, Texas Government Code,
to allow the employees of a participating department to participate
in the pension system. Pursuant to the authority granted to the state
board under §861.006(a), Texas Government Code, and as contemplated
by §302.7 of this title (relating to Employees of Participating
Departments), the state board adopts this rule to ensure the participation
of employees of participating departments, whether full-time or part-time,
satisfies the plan qualification requirements under §401(a) of
the Code and to maintain the status of the pension system as a governmental
plan under §414(d) of the Code.
(c) Notwithstanding §862.002, Texas Government
Code, the employees of any department that does not constitute or
is not part of a governmental entity or a government-controlled entity
are not eligible to participate in the pension system, including,
without limitation, a §501(c)(3) or other nonprofit corporation
incorporated under state law that contracts with a governmental entity
to provide fire protection and emergency response services for the
general public or receives public funding for the performance of such
services.
(d) For purposes of this section, a participating department
will constitute or will be considered to be a part of a governmental
entity if the participating department is a department of a municipality,
county, special-purpose district or authority or any other political
subdivision of the state of Texas whose employees are considered employees
of a governmental entity.
(e) For purposes of this section, a participating department
will constitute or will be considered to be a part of a government-controlled
entity if a majority of the governing body of the department is composed
of publicly elected or appointed officials of the state of Texas or
individuals appointed by such elected or appointed officials, regardless
of whether or not the department itself is a governmental entity.
(f) Solely for purposes of participation in the pension
system and, except as otherwise provided below, prior to the first
date of participation in the pension system, if a governmental entity
or government-controlled entity has both employees and volunteers
who are performing emergency services or support services, the governing
body of such entity may elect to treat its paid employees as members
of a paid department that is separate from its volunteer department,
and such paid department may make a separate election as to whether
or not to participate in the pension system under §862.001(a-1),
Texas Government Code. The governing body of such governmental entity
or government-controlled entity must notify the executive director
in writing of its election to treat its paid employees as members
of a separate department prior to any election to participate in the
pension system.
(g) Notwithstanding subsection (f) of this section,
the governing body of a participating department that constitutes
or is part of a governmental entity or a government-controlled entity
that has made an election to participate in the pension system under §862.001(a-1),
Texas Government Code, before September 1, 2020, may elect to treat
its paid employees as members of a separate paid department that will
not participate in the pension system by notifying the executive director
in writing of its election no later than December 31, 2020. Such paid
department will not be considered to have elected to participate in
the pension system and its paid employees will not be enrolled as
members of the pension system unless a separate election is made by
the governing body of the department on behalf of such paid department
to participate in the pension system.
(h) Any governmental entity or government-controlled
entity that elects to separate its paid employees and volunteers into
different departments for purposes of participation in the pension
system under this section must maintain separate records for each
department, including, without limitation, records related to the
enrollment of its members and qualified service earned by each member
in such department.
(i) For purposes of determining a member's eligibility
to participate in the pension system, if a member performs emergency
services or support services as both an employee and a volunteer for
the same participating department, such member will not be eligible
to earn qualified service for his or her service in both positions
unless each position has different roles and responsibilities that
are clearly distinct from the roles and responsibilities of the other
position.
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