40 Tex. Admin. Code § 610.20 - Criteria for Determining Adherence to a Legacy Funding Soundness Restoration Plan
(a) A public
retirement system is adhering to a legacy funding soundness restoration plan if
the system's actuarial valuation shows:
(1)
the funding period is expected to fall within 40 years by the target date and
so long as the system's funding period continues to shorten while the system's
funding period is above 40 years and does not increase to a length of time
greater than 40 years after falling below 40 years; or
(2) an increase in funding period compared to
the previous valuation, and the system's actuarial valuation shows that,
between the valuation date and the system's target date, the system's funding
period or funded ratio remains within the compliance corridor adopted in board
rule. If the system's funding period is infinite, only the funded ratio will be
evaluated to determine compliance for the purposes of this paragraph.
(b) A public retirement system
with a legacy funding soundness restoration plan may submit a projection to
serve as the baseline for the purpose of this subsection. This projection must
show the projected funded ratio and funding period for each year beginning with
the current date until the target date. For any years the system's funding
period is projected to be above 40 years, the corridor will be based on the
baseline. For any years the system's funding period is projected to be below 40
years, the compliance corridor will be based on a minimum of 40 years. If the
system does not submit such a projection to the board for this purpose, the
board will determine adherence to the legacy funding soundness restoration plan
using a baseline in which a system's funding period must decrease by one year
every consecutive year as measured on the anniversary of the date on which the
final version of the funding soundness restoration plan was agreed to as
required by law.
(c) The allowable
degree of variation from the baseline will begin at five percent for a funded
ratio corridor or ten years for a funding period corridor and will decrease
over period between the current date and the target date as described by
Figure: 40 TAC §
610.20(c). A
system would be considered compliant if plan experience exceeds a corridor in a
favorable way. The board will use each system's baseline to provide a
compliance corridor unique to that system based on their funding period and
funded ratio, using the corridor sizes specified in these rules.
Notes
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.