Texas HB4280 modifies the treatment of deferred retirement option plans (DROP) for police and firefighters.

Texas HB4280 amends the state's public retirement systems for police and firefighters. It mandates that assets and liabilities associated with DROP be separately accounted for in actuarial valuations, excluding them from the fund's overall analysis. Additionally, the bill allows the board to adopt a shorter period for annuitizing DROP account balances if the pension system's qualified actuary confirms it will not exceed a 25-year amortization period. The act takes effect immediately if it receives a two-thirds vote in both houses, otherwise, it will take effect on September 1, 2025.

Texas HB4280 modifies the treatment of deferred retirement option plans (DROP) for police and firefighters.

Texas HB4280 amends the state's public retirement systems for police and firefighters. It mandates that assets and liabilities associated with DROP be separately accounted for in actuarial valuations, excluding them from the fund's overall analysis. Additionally, the bill allows the board to adopt a shorter period for annuitizing DROP account balances if the pension system's qualified actuary confirms it will not exceed a 25-year amortization period. The act takes effect immediately if it receives a two-thirds vote in both houses, otherwise, it will take effect on September 1, 2025.