34 Tex. Admin. Code § 73.22 - Increasing Annuity Option

(a) This section governs the increasing annuity option described in Tex. Gov't Code § 814.110, which is also known as the "self-funded increase option."

(b) If a retiree selected an increasing annuity under Tex. Gov't Code § 814.110 prior to retirement, annuity payments shall increase by two percent (2%) each year, calculated annually on the anniversary of the retiree's original retirement.

(c) If a retiree selected an increasing annuity together with an optional service retirement annuity described by Tex. Gov't Code § 814.108, the retiree shall receive the annual increase for the retiree's lifetime, and upon the retiree's death, the retiree's designated beneficiary shall continue to receive the annual increase during the beneficiary's lifetime.

(d) If a retiree selected an increasing annuity together with an optional service retirement annuity described by Tex. Gov't Code § 814.108 and the retiree's designated beneficiary predeceases the retiree, the system shall recalculate the annuity. The annuity first shall be recalculated in accordance with Tex. Gov't Code § 814.108(d) and then shall be adjusted to account for the annual increase. The recalculated annuity shall be actuarially equivalent to the increasing annuity that the retiree would have received if the retiree had selected only an increasing annuity without the optional service retirement annuity. After the annuity is recalculated, the retiree shall continue to receive an annual increase based on the recalculated amount, in accordance with Tex. Gov't Code § 814.110 and this section, throughout the retiree's lifetime.

Notes

34 Tex. Admin. Code § 73.22

Adopted by Texas Register, Volume 50, Number 15, April 11, 2025, TexReg 2436, eff. 4/16/2025