Relating to the public retirement systems of certain municipalities.

Contracts

• Actuarial Vendor Agreements: You must amend contracts with actuarial firms immediately. The scope of work must explicitly require the "Entry Age Normal" cost method. Any contract referencing "Ultimate Entry Age Normal" is now non-compliant.
• Collective Bargaining Agreements (CBA): While state law supersedes CBAs, HR departments must review current agreements for conflicting language regarding retirement age to prevent grievance filings during the transition.

Hiring/Training

• Benefits Administration Staff: Train staff immediately on the new eligibility formula:
• Standard: 20 years of service (any age).
• Alternative: Age 50 with 10 years service (Fire); Age 60 with 10 years service (Police).
• DROP Management: Staff must be retrained to allow Firefighter DROP participation up to 15 years (previously 13).

Reporting & Record-Keeping

• Risk Sharing Valuation Study: The annual valuation report must now use a 5-year asset smoothing period and amortize unfunded liabilities over a closed 30-year period.
• Summary Plan Descriptions (SPDs): Plan documents and member handbooks must be revised and redistributed to reflect the removal of complex "Rule of 70" or tiered age-service requirements.

Fees & Costs

• Administrative Costs: Expect a one-time increase in administrative costs for software reprogramming (benefit calculators) and legal review of plan documents.
• Municipal Contributions: While not a "fee," the change in actuarial method may alter the City of Houston's required contribution rate in the next fiscal cycle.