H.B. No. 3474 amends Section 802.109 of the Government Code to enhance the evaluation and reporting processes for public retirement systems in Texas. The bill introduces a schedule established by the Pension Review Board, mandating that public retirement systems conduct evaluations based on their total assets. Specifically, systems with assets of at least $100 million must evaluate every three years, while those with assets between $30 million and $100 million must evaluate every six years. Additionally, if a system's total assets exceed the specified thresholds, it must complete the evaluation by the next due date. The bill also stipulates that systems must continue to evaluate based on total pension liability, with similar timelines for evaluations.

Further changes include requirements for independent firms conducting evaluations to submit preliminary drafts to the retirement systems for discussion and clarification, and the governing bodies of these systems must submit evaluation reports to the Pension Review Board. The bill also allows governmental entities employing active members to cover evaluation costs, while the retirement systems are responsible for any remaining costs. The first evaluation report under the new requirements must be filed by September 1, 2026, and the Pension Review Board is tasked with establishing the evaluation schedule by January 1, 2026. The act is set to take effect on September 1, 2025.

Statutes affected:
Introduced: Government Code 802.109 (Government Code 802)