STATE PENSION REVIEW BOARD OF TEXAS EDUCATION AND RESEARCH COMMITTEE MEETING AGENDA

Transcription

1 STATE PENSION REVIEW BOARD OF TEXAS EDUCATION AND RESEARCH COMMITTEE MEETING AGENDA Thursday, November 12, :30 am William P. Clements State Office Building Meeting Room West 15 th Street, Austin, Texas Meeting called to order. 2. Roll call of Committee members. 3. Discuss and consider the Minimum Educational Training (MET) Program for trustees and system administrators pursuant to Section of the Texas Government Code, including the following: A. Online training standards. B. Training taken before a trustee or administrator s service begins. C. MET Curriculum Guide. D. MET compliance reporting to the Legislature. 4. Invitation for audience participation. 5. Adjournment. NOTE: Persons with disabilities who plan to attend this meeting and who may need special assistance are requested to contact Shelia Bledsoe at (512) three to five (3-5) working days prior to the meeting so that appropriate arrangements can be made. 1

2 Pension Review Board November 12, 2015 Minimum Educational Training (MET) Program Online Training Attendance Standards The MET Program rules (40 Tex. Admin. Code Section ) require accredited sponsors to track attendance and provide certificates of completion to all trustees and system administrators who successfully complete training activities. Question for Consideration: While the rules allow online training, they do not specifically address how an accredited sponsor would fulfill the attendance tracking requirements when delivering a course via the Internet or digital media. What standard should accredited sponsors be required to meet? Option 1: Require sponsors to track attendance Under this option, the PRB would provide no further guidance in rule on how accredited sponsors should track or verify attendance. The Texas State Bar requires sponsors to track attendance for in-person and online courses. 1 Option 2: Require sponsors to provide a completion code Under this option, the MET rules would be amended to require sponsors offering training via the Internet or video to include a completion code at the end of the course. Course participants would provide the code to the sponsor as proof of their completion of the course. The Texas Attorney General s Office requires sponsors to track attendance for in-person and online courses. 2 Option 3: Require sponsors to provide an exam (PRB staff recommendation) Under this option, the MET rules would be amended to require sponsors offering training via the Internet or video to require participants to pass a final exam testing the participant s comprehension of course materials. The Texas State Board of Public Accountancy requires sponsors offering internet or DVD courses to require participants to pass a final exam containing at least 5 questions per credit hour granted. 3 The Texas Workforce Commission requires a 70% pass rate of quiz questions for successful completion of their online courses. 4 Option 4: Require sponsors to use a learning management system to track online course completion Under this option, the MET rules would be amended to require sponsors offering training via the Internet or video to utilize a learning management system (LMS) which would automatically track course completions. Other agencies use and the PRB will use an LMS to track online course completions. A requirement to acquire an LMS would have a cost to the sponsor. 1 State Bar of Texas. (April 2015). Texas MCLE Regulations. Available at ntid=29173 (accessed November 14, 2015). 2 Attorney General of Texas. Open Government Training Video. Available at (accessed November 4, 2015) Texas Administrative Code Section and Available at p_tac=&ti=22&pt=22&ch=523&rl=102 (accessed November 4, 2015). 4 Meeting with TWC staff on September 9,

3 TEXAS MCLE REGULATIONS 1.0 MCLE COMPLIANCE YEAR 1.1 The definitions set forth in Article XII, State Bar Rules, Section 2, shall apply to these Texas MCLE Regulations. 1.2 Each member's initial MCLE compliance year shall begin on the first day of the member s birth month that occurs after the licensing date and shall end twenty-four (24) months later on the last day of the month immediately preceding the member s birth month. 1.3 The minimum CLE credits needed for a regular one-year MCLE compliance year are required to be completed during the initial 24-month MCLE compliance year. Only CLE credits completed within this 24-month period and during the 12-month period immediately preceding the initial compliance year may be used toward meeting the compliance requirements of the initial compliance year. The sole exception shall be for The Guide to the Basics of Law Practice sponsored by the Texas Center for Legal Ethics and Professionalism, which may be completed earlier for Accredited CLE Activity credit. 1.4 A member's minimum CLE requirements should be completed by the last day of the MCLE compliance year for any given year. However, if a member has not completed the minimum CLE requirements by the last day of any given MCLE compliance year, then that member shall be given an automatic grace period up to the last day of their birth month, or reporting month if an extension has been granted in accordance with these regulations and Article XII, to complete the minimum requirements without penalty. If the minimum credits are not completed or reported until after the end of the member's birth month for that year, then a penalty will be required as specified below in Section CATEGORIES OF CREDIT 2.1 Accredited CLE (Minimum of 12 hours allowable) Sponsor Submitted Accredited CLE Activities shall include activities that have been submitted for review and accreditation to the MCLE Director and that comply with Article XII, Section 4A, State Bar Rules, with Section 10 of the MCLE Regulations and with the Accreditation Standards for CLE Activities established by the MCLE Committee. To qualify as an Accredited CLE Activity, the CLE sponsor must keep track of attendance at the activity, whether it is live or prerecorded, or delivered individually, electronically, or in a group setting, and shall report attendance to the MCLE Department in accordance with MCLE Regulations, Section a. Attendance at an Accredited CLE Activity may be in person or by electronic means and may include viewing or listening to prerecorded media or attendance by such means as may be developed through advanced technology. 3

4 11/6/ T H E A T T O R N E Y G E N E R A L O F T E X A S Ken Paxton Congratulations on finishing the Office of the Attorney General's Open Government training video. New legislation effective January 1, 2006 requires all elected officials to take Open Government training courses, specifically regarding the Open Meetings Act, and the Public Information Act. Watching our videos satisfies this requirement, and is done so on the honor system. Have you viewed one of the Open Government Training videos or attended the OAG's Open Government Conference? Yes No Please enter the Access Code: Date of Training: Month: November Day: 06 Year: 2015 Next ADDITIONAL LINKS ACCESSIBILITY PRIVACY & SECURITY REPORT FRAUD SITE POLICY DATA SETS SITE INDEX CAREERS 4 1/1

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6 Pension Review Board November 12, 2015 Minimum Educational Training (MET) Program Training Completed in Advance of Service The MET Program rules (40 Tex. Admin. Code Section ) require new trustees and system administrators to complete 7 hours of core training within their first year of service. Section defines first year of service as the twelve-month period beginning from the date of assuming one's position on the governing body or hiring date. Several retirement systems have asked the PRB if training completed before a trustee or administrator s service begins can count toward the core requirement, citing scenarios including: A trustee has been appointed but will not be sworn in and begin serving for another month and would like to use that time to take the MET training. An individual has been approached about possibly serving on a retirement system and would like to take the MET training in advance. Question for Consideration: Should the MET rules be amended to allow training to be completed in advance of the first year of service? Given that MET is intended to be current, how far in advance of service should MET be able to count? Option 1: Do not allow completion of MET before service begins Under this option, the MET rules would not be changed to allow core training to be completed in advance of service. Option 2: Allow MET completed up to 3 months before service begins Under this option, the MET rules would be amended to allow trustees and administrators to complete MET core training no more than 3 months before beginning their first year of service. Option 3: Allow MET completed up to 6 months before service begins (PRB staff recommendation) Under this option, the MET rules would be amended to allow trustees and administrators to complete MET core training no more than 6 months before beginning their first year of service. 6

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8 Texas Pension Review Board Curriculum Guide for Minimum Educational Training September

9 Curriculum Guide for Minimum Educational Training The purpose of this document is to provide further direction on curriculum for the Pension Review Board s (PRB) Minimum Educational Training Program for trustees and administrators of Texas public retirement systems, as established by Section of the Texas Government Code and 40 TAC Chapter 607. The specific topics listed below are intended to provide guidance on the core and noncore content areas, as approved by the Board. First Year of Service. A new trustee and a new system administrator shall complete at least seven credit hours of training in the core content areas within the first year of service. The board intends for firstyear training in core content areas to be basic, foundational, and accessible to individuals with no previous knowledge in the topic area. A course offered for first-year credit should make an effort to address all of the sub-topics and learning objectives in the core content areas listed below. A course offered for first-year credit that does not address a substantial number of the sub-topics and objectives may be denied approval. Subsequent Years of Service. A trustee and a system administrator shall complete at least four credit hours of continuing education in core content areas, non-core content areas, or any combination of the two, within each two-year period after the first year of service as a new trustee or system administrator. The non-core content areas include topics that go beyond the basics, and are designed to allow trustees and administrators to gain further expertise in additional areas related to their duties. 1. Fiduciary Matters Core Content Areas Courses covering this topic should explain who may be a fiduciary and what the role of a fiduciary entails, including responsibilities, liability, and prohibitions. Definition of a fiduciary Fiduciary responsibilities Fiduciary duty and fiduciary liability Duty to administer the plan in accordance with statutes, laws, and rules Standards of conduct Prohibited transactions and interests Fiduciary roles of pension professionals, including investment managers and custodians Objectives-- After completing this course, trustees and administrators should be able to: - Understand the roles and duties of fiduciaries; - Be familiar with the laws that apply to fiduciaries in Texas; - Understand the duty of loyalty and the exclusive benefit rule; - Understand the duty of prudence; - Understand the duty to follow the plan documents; - Be aware of potential conflicts of interest and how to avoid them; 9 Texas Pension Review Board September 2015

10 Curriculum Guide for Minimum Educational Training - Know some of the liabilities facing fiduciaries who fail to discharge their fiduciary responsibilities; - Be familiar with some examples of litigation involving fiduciary liability; - Comprehend co-fiduciary liability ; and - Be aware of ethical responsibilities that are expected of fiduciaries. 2. Governance Courses on governance should explain the structure, manner, and processes through which a board exercises authority. They should also provide an overview of the types of plan professionals with whom trustees will interact, including the board actuary, investment consultants, legal counsel, and auditors. Trustee appointments, terms, and qualifications Role and responsibilities of board Laws and rules governing the system Board bylaws, policies, processes, and procedures Best practices for pension board governance Roles and responsibilities of key service providers Delegation of responsibilities while retaining appropriate oversight Strategic planning Objectives-- After completing this course, trustees and administrators should be able to: - Be familiar with the composition of their board and how trustees are appointed; - Understand their responsibilities as board members; - Understand the roles of the board s committees, system administrator and staff; - Know the ways in which management of the system is delegated to the executive director; - Understand the roles and responsibilities of investment consultants and managers, the board s actuary, legal counsel, and auditors; - Comprehend the board s oversight role relating to contracted professionals; - Be familiar with the laws and rules governing public pension plans in Texas and any governing documents including bylaws; - Have a basic understanding of the plan s policies and procedures; and - Utilize best practices associated with good pension plan governance. 3. Ethics In addition to covering applicable state and federal ethics laws, courses addressing this section should explain the purpose and benefits of adopting an ethics policy, and outline areas that should be addressed in such a policy. Applicable ethics laws What is an ethics policy, and why is it important to adopt one? What should be covered by an ethics policy? 10 Texas Pension Review Board September 2015

11 Curriculum Guide for Minimum Educational Training Ethics in investing Objectives-- After completing this course, trustees and administrators should be able to: - Understand the various fiduciary duties; - Be familiar with state and federal ethics laws that apply to public officials; - Understand the consequences of violating ethics laws; - Know what should be included in an ethics policy; - Be familiar with basic standards of conduct; - Understand the potential conflicts of interest faced by fiduciaries; - Know about prohibited transactions and interests; - Be aware of required disclosures; - Understand issues relating to confidentiality; and - Be familiar with laws governing nepotism, gifts, and benefits. 4. Investments Courses related to investments should give trustees a solid understanding of the investment landscape including market realities, risk implications, and attainable objectives. Asset classes and types Investment objectives and strategies Asset allocation and diversification What is an investment policy, and why is it important to adopt one? Ethics in investment Due diligence in investment selection Due diligence in the investment consultant and manger selection process Managing investment expenses and fees Assessing risk tolerance Managing investment risk Investment portfolio performance review Objectives-- After completing this course, trustees and administrators should be able to: - Distinguish the different characteristics of stocks, bonds, and other major asset classes; - Understand the risk involved in investing in certain asset classes; - Comprehend passive and active investment management strategies; - Explain the importance of diversification; - Analyze returns, comparing with a system s assumed rate of return; - Understand the basic elements of an investment policy statement and be familiar with their system s investment policy; - Understand the role of the trustee as it relates to investment decisions; - Be familiar with due diligence and investment performance evaluation processes; - Understand the role of investment consultants and investment managers; and - Be aware of best practices for selecting and evaluating investment managers. 11 Texas Pension Review Board September 2015

12 Curriculum Guide for Minimum Educational Training 5. Actuarial Matters Courses covering actuarial topics should provide an introduction to actuarial terminology, methodology, and assumptions. Key terms and definitions Actuarial assumptions Actuarial methodologies Role of the actuary and the role of the board Reading an actuarial valuation and other actuarial reports Objectives-- After completing this course, trustees and administrators should be able to: - Explain the role of the board s actuary; - Comprehend basic actuarial terms; - Read and understand an actuarial valuation; - Understand the difference between pay-as-you-go and advance or pre-funding; - Be familiar with the demographic and economic types of actuarial assumptions; - Distinguish the difference between the market value and actuarial value of assets; - Distinguish between different types of actuarial cost methods; - Understand different amortization methods; - Understand asset smoothing techniques; - Understand the amortization period and PRB Guidelines for Actuarial Soundness; - Understand and evaluate funded ratios; - Be aware of best practices such as funding policies; - Be familiar with the different types of actuarial reports such as experience studies and actuarial audits; and - Understand what should be taken into consideration for a system to increase benefits. 6. Benefits Administration Courses covering this topic should provide an understanding of plan benefit structures and of benefits administration. Plan design Tax qualified pension plan requirements Contested cases and appeals that may require board action Methods of communicating with members Objectives-- After completing this course, trustees and administrators should be able to: - Understand the features of defined benefit, defined contribution, and hybrid plans; - Understand the responsibility of the board as it relates to benefits administration; - Understand the responsibility of the staff for day-to-day operations; 12 Texas Pension Review Board September 2015

13 Curriculum Guide for Minimum Educational Training - Read and interpret the component parts of plan design (including retirement eligibility, vesting requirements, benefit formulas, final average salary, and cost-of-living adjustments); - Be familiar with additional benefits such as Deferred Retirement Option Plans (DROPs); - Be familiar with Qualified Domestic Relations Order (QDRO) requirements; - Be aware of the tax qualified pension plan status under the IRS Code; - Be aware of provisions relating to correction of errors in benefit calculation; - Be aware of their system s processes for hearing appeals and contested cases; - Understand the methods of communicating benefit information to system members; and - Be familiar with current issues and trends in benefit administration. 7. Risk Management Courses related to risk management should examine different types of risk and the ways in which those risks may be mitigated. Managing fiduciary liability Managing investment risk Risk assessment Internal controls and compliance Financial controls and reporting requirements applicable to vendors Comprehensive Annual Financial Report (CAFR) Roles of auditors (internal or outside) Record keeping Security of confidential information Objectives-- After completing this course, trustees and administrators should be able to: Managing General Risk - Demonstrate understanding of fiduciary responsibility; - Know several strategies for protecting against fiduciary liability; - Be familiar with risk assessment; - Understand internal control concepts, such as preventative and detective controls; - Distinguish the roles of the trustees, system administrator and staff, related to risk control; - Read and understand a Comprehensive Annual Financial Report; - Comprehend the role of auditors, including internal and external; - Be aware of state requirements related to contracting; - Be familiar with their system s measures for ensuring security of confidential information; - Understand the importance of recordkeeping requirements Managing Investment Risk - Explain the importance of diversification; - Be familiar with types of investment risk including systematic and specific risk, and how to manage total risk; 13 Texas Pension Review Board September 2015

14 Curriculum Guide for Minimum Educational Training - Understand the basic elements of an investment policy statement and be familiar with their system s investment policy; and - Demonstrate understanding of due diligence. Non-Core Content Areas 1. Compliance Courses covering compliance issues should provide information on legal and reporting requirements, as well as applicable internal policies and procedures. State laws and regulations Federal laws and regulations Internal policies and procedures State reporting requirements 2. Legal and Regulatory Matters Courses covering legal and regulatory issues should provide information on current or potential lawsuits, legislation, or regulation. Legal landscape Pension litigation Legislative issues and updates Regulatory oversight 3. Pension Accounting Courses related to pension accounting should provide attendees with a basic understanding of plan assets and liabilities, financial statements, and GASB requirements. Governmental Accounting Standards Board (GASB) requirements Assets and liabilities Reading plan financial statements Plan cost 4. Custodial Issues Courses covering custodial issues should provide information about the process of selecting a custodian and what to look for in a custodian. Custodian selection process Executing trust agreements Applicable state law and plan requirements 5. Plan Administration Courses related to plan administration should provide information on the day-to-day aspects of administering pension plans. 14 Texas Pension Review Board September 2015

15 Curriculum Guide for Minimum Educational Training Contributions Distributions Plan design Reporting requirements Vesting Participation Communicating with members 6. Texas Open Meetings Act A course on open meetings should familiarize attendees with requirements under Texas law. Applicability of the Open Meetings Act Legal requirements for meetings Meeting notice requirements Procedures for holding a closed meeting Penalties for non-compliance 7. Texas Public Information Act A course on open records and public information should familiarize attendees with requirements under Texas law. Applicability of the Public Information Act Legal requirements for handling requests for information Policies and procedures relating to external communication Penalties for non-compliance 15 Texas Pension Review Board September 2015

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17 Pension Review Board November 12, 2015 Minimum Educational Training (MET) Program Compliance Reporting Regarding compliance reporting for the MET Program, Government Code states the following: The board shall develop a system to track compliance with the minimum training requirements by trustees and system administrators and shall report the level of compliance in the biennial report required by Section (Section requires the PRB to submit a biennial report to the legislature and governor in November of each even-numbered year.) Question for Consideration: Should the PRB report MET compliance using positions or positions and names? Option 1: Report MET compliance by position Example: Cherrytree ISD Public Retirement System (62.5% Compliant) Trustees: Active Employee Member Active Employee Member Active Employee Member Mayor or designee CFO or designee Taxpayer/Citizen Member Taxpayer/Citizen Member System Administrator: Compliant Compliant Not compliant Compliant Not compliant Compliant Not compliant Compliant Option 2: Report MET compliance by position and name Example: Cherrytree ISD Public Retirement System (62.5% Compliant) Trustees: Active Employee Member Peter Vidoni Compliant Active Employee Member Thomas Patterson Compliant Active Employee Member Bernadette Armstrong Not compliant Mayor or designee Lynn Bradley Compliant CFO or designee Ben Nystrom Not compliant Taxpayer/Citizen Member Sheryl Gray Compliant Taxpayer/Citizen Member Derrick Skinner Not compliant System Administrator: Laurie Garon Compliant 17

18 Sample Retirement System Board Structures Municipal, TLFFRA and Chapter 810 Plans 18

19 Pension Review Board November 12, 2015 Municipal Retirement Systems Plan Active Employee Retiree City Appointee Citizen Member Governing Statute 1 Member of City Governing Body; 3 City residents, must 4 Active employees; 2 Retired members; appointed by and serving be qualified voters and Austin Employees' elected by active elected by retired at the pleasure of the city not employees/former Retirement Fund membership body. Fouryear membership body. Four governing body. No term employees; appointed Article 6243n, V.T.C.S. year specified. 1 City manager, or designee. by city governing body. Four year Austin Fire Fighters' Relief and Retirement Fund Austin Police Retirement System Dallas Employees' Retirement Fund 3 Fund members (may be active or retired); elected by active and retired members. Threeyear 5 Police officer fund members; elected by system members. Fouryear 3 City employee fund members, from different city departments; elected by fund members. Three year See Active Employee entry. 2 Retired members; elected by the retired membership body. Fouryear 1 Mayor. 1 City Treasurer. No terms specified. 1 Member of City Council, designated by City Council. 1 City Manager or designee. 1 Director of Finance or designee. No terms specified. 3 City Council members or appointees; appointed by City Council. Two year 1 City auditor. 1 City resident, must be qualified voter and resident for preceding five years; appointed by police retirement board. Four year Article 6243e.1, V.T.C.S. Article 6243n 1, V.T.C.S. Dallas Police and Fire Pension System 6 Active members, three police and three fire; elected by their respective departments. Four year 2 Retired fund members, one police and one fire. Four year 4 City Council members; appointed by City Council. Term same as City Council Combined Pension Plan Document as Amended and Restated Through March 1, 2011; supersedes Article 6243a 1, V.T.C.S. 19

20 Pension Review Board Municipal Retirement Systems November 12, 2015 Plan Active Employee Retiree City Appointee Citizen Member Governing Statute 2 City residents, must have resided in city for 4 City employees at least two years 1 Retired city employee 2 District El Paso City qualified to participate in immediately preceding receiving pension benefits, representatives; Municipal Code/City Employees' Pension the fund; elected by appointment and are must be city resident; designated by City Charter Fund employees qualified to not city appointed by mayor. Council. participate in the fund. officers/employees; appointed by mayor. Two year terms. El Paso Firemen and Policemen's Pension Fund 3 Policemen; elected by members of the policemen's pension fund. Four year terms. 3 Firemen; elected by members of the firemen's pension fund. Four year terms. 3 City residents; designated by the mayor. Four year terms. 2 City residents; Article 6243b, V.T.C.S. designated by the city manager. Four year terms. Fort Worth Employees' Retirement Fund 1 Vested police officer fund member; elected by police fund members. Two year 1 Vested firefighter fund member; elected by firefighter fund members. Two year 2 Vested general employee fund members, not police or firefighters; elected by civilian fund members. Two year 1 Retired police officer; elected by retired police officer fund members. Two year 1 Retired firefighter; elected by retired firefighter fund members. Two year 1 Retired general employee, not police or fire; elected by civilian retirees. Two year 5 City residents, may not be members of city 1 City chief financial governing body; officer; designated by city nominated by mayor, governing body. Twoyear vote of city governing confirmed by majority body. Two year Article 6243i, V.T.C.S. 20

21 Pension Review Board November 12, 2015 Municipal Retirement Systems Plan Active Employee Retiree City Appointee Citizen Member Governing Statute 1 President of municipal police association, or nexthighest ranked member 1 Municipal finance 1 Legally qualified voter; designated by the if President is not a fund staff employee; Galveston mayor. Two year member. Term equal to designated by and Employees' Pension 1 Legally qualified Article 6243p, V.T.C.S. president's term of serving at the pleasure of Plan for Police voter; designated by office. the city manager. No city council. Two year 3 Members of the fund; term specified. elected by fund members. Three year Galveston Employees' Retirement Plan 3 City employees; elected by city employees who are current members in the plan. Terms of office determined by Board bylaws. 1 City employee in the City's Finance Department; appointed by the City Manager. Terms of office determined by Board bylaws. 1 City resident, must not be a city employee; appointed by the mayor. Terms of office determined by Board bylaws. 2 City residents, must not be city employees; appointed by the other five Board of Trustee members. Terms of office determined by Board bylaws. 21

22 Pension Review Board Municipal Retirement Systems November 12, 2015 Plan Active Employee Retiree City Appointee Citizen Member Governing Statute 2 City residents, must be registered voters, 1 Mayor, or appointed 1 Retiree fund members, not employees of the representative of the 5 Firefighters who are with at least 20 years of city, and city residents mayor. No term Houston Firefighter's members of the fund; fund participation; elected for at least one year specified. Article 6243e.2(1), Relief and elected by firefighters by retired firefighter fund preceding initial 1 City treasurer, or V.T.C.S. Retirement Fund who are members of the members with 20+ years appointment; person performing fund. Three year of service. Three year appointed by the treasurer duties for the elected members of the city. No term specified. Board of Trustees. Twoyear Houston Municipal Employees' Pension System 2 Retirees, must be 4 Municipal employees receiving a retirement who are members of the pension from the system, pension system, with at have at least five years of least 5 years of credited service in the pension service; elected by active system, and not currently members of the pension a city officer or employee; system. No term elected by retirees of the specified. pension system. No term specified. 1 Person appointed by mayor; must not be a participant or beneficiary in the pension system. Three year 1 Person appointed by the city controller; must not be a participant or beneficiary in the pension system. Three year 2 Persons appointed by the governing body of the city; must not be participants or beneficiaries of the pension system. Threeyear terms. 1 Person appointed by elected Board of Trustee members, must have been a resident of the state for the three years preceding the date of initial appointment. Threeyear 2011 Amended and Restated Meet and Confer Agreement; supercedes outdated Article 6243h, V.T.C.S. 22

23 Pension Review Board November 12, 2015 Municipal Retirement Systems Plan Active Employee Retiree City Appointee Citizen Member Governing Statute Houston Police Officers' Pension System 3 Police employees who are members of the pension system; elected by active, inactive and retired members of the pension system. Threeyear 2 Retired members, must be receiving pensions from the system and not currently city employees or officers; elected by active, inactive and retired members of the system. Three year 1 Administrative head of the city, or authorized representative. No term specified. 1 City treasurer, or person discharging treasurer duties. No term specified. Article 6243g 4, V.T.C.S. San Antonio Fire and Police Pension Fund 2 Active member firefighters, must be below the rank of fire chief; elected by fire department fund members. Four year terms. 2 Active member police officers, must be below the rank of police chief; elected by police department fund members. Four year terms. 1 Fire department retiree; elected by fire department retiree fund members and surviving spouses currently receiving benefits. Fouryear 1 Police department retiree; elected by police department retiree fund members and surviving spouses currently receiving benefits. Fouryear 1 Mayor, or qualified mayoral designee. Term corresponds to mayor's term of office. 2 Members of the city governing body; appointed by the governing body. Term corresponds to city government term of office. Article 6243o, V.T.C.S. 23

24 Pension Review Board November 12, 2015 TLFFRA Retirement Systems Plan Active Employee Retiree City Appointee Citizen Member Governing Statute 1 Mayor or designated representative, or the political subdivision's Chief Operating 2 Residents of the State 3 Members of the Officer or designated of Texas,must not be retirement system; TLFFRA Plans, Paid or representative. officers/employees of the Article 6243e, sec. 19. elected by fund Part Paid 1 Chief Financial Officer of political subdivision; elected V.T.C.S. members. Three year the political subdivision, or by other Board of Trustee terms. designated representative. members. Two year terms. Terms correspond to term of office. 24

25 Pension Review Board November 12, 2015 Chapter 810 Retirement Systems Examples Dallas/Fort Worth Airport Board Retirement Plan Plan Active Employee Retiree City Appointee Citizen Member Other University Health System Pension Plan 1 CEO 1 Exec VP of Admin/Diversity 1 Exec VP of Finance and IT 2 Administrative Staff of the System 1 Dallas Mayor 1 Fort Worth Mayor 3 5 from Bexar County, Non Employees 3 Members of the Airport Board, Appointed by the Chairman of the Board 2 Trustees from the Board of Managers of the System Governing Statute (Source Document) 2008 Plan Summary, Rules of Procedure 2013 Investment Policy (page 3) 2003 Plan Design Restated, pg 51; Pension Trustees' Bylaws 25