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TexasHB 268889th Legislature Regular SessionHouseWALLET

Relating to the public retirement systems of certain municipalities.

Sponsored By: Sam Harless, Joan Huffman (Republican), Will Metcalf, Tom Oliverson, Mary Ann Perez, Senfronia Thompson

Signed by Governor

HOUSTON, CITY OFCity Government--FinanceRetirement Systems--MunicipalRetirement Systems--Police & Firefighters

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Bill Overview

Analyzed Economic Effects

10 provisions identified: 6 benefits, 3 costs, 1 mixed.

Deferred pensions reach more former firefighters

Firefighters leaving active service for a reason other than death qualify with at least 10 but fewer than 20 years of fund participation. Their deferred pension begins at age 50. The monthly payment equals 1.7% × average monthly salary × years of participation. The law removes the former hiring-date limit.

New retirement tests for newer firefighters

For firefighters hired or rehired on or after the specified 2017 effective date, normal retirement age requires age 50 and 10 years of service. Separately, these members qualify for a service pension after 20 years of service, subject to Section 4(b-2). They must leave active service for a reason other than death to receive that pension. These rules replace the former test requiring age plus years of fund participation to total 70.

Police retirement tests no longer vary

Police pension members reach normal retirement age after 20 years of service, or at age 60 with at least 10 years. These tests no longer depend on hire date. For members hired or rehired on or after October 9, 2004, they replace the former age-plus-service total of 70.

Short-service firefighters get contribution refunds only

Firefighters leaving active service for a reason other than death before completing 10 years of fund participation get only their contributions back. The refund includes no interest. They cannot receive a deferred pension or any other benefit under this retirement law.

City workers gain deferred retirement access

Beginning September 1, 2025, active members of the covered municipal pension system can choose DROP after reaching normal retirement age. They receive a DROP benefit instead of the standard pension. Members must file under board procedures, and the board must accept the election. Once accepted, the election cannot be revoked. The former hire-date and separate 20-year service conditions are removed.

Firefighter deferred retirement lasts two years longer

For active firefighters participating on or after the specified 2017 effective date, the DROP maximum rises from 13 to 15 years. Monthly pension credits stop when active service ends or on the first credit's 15th anniversary, whichever comes first. The account continues earning applicable interest after that anniversary. After a service break, later service credit is limited to the shorter of the break or time needed to reach 15 years. The law retains limits on payroll-deduction credits: pre-2017 deductions may be credited, but post-2017 deductions cannot, apart from the stated unused-leave exception.

More firefighters can choose deferred retirement

Active firefighters eligible for a Section 4 service pension can join the deferred retirement option plan, called DROP. They must complete 20 years of fund participation, and the board must approve their election. Access now extends beyond the former Section 4(a)(1) group. The election cannot be revoked and sets the retirement date used to calculate the pension when active service ends.

Firefighter pension court appeal route removed

The law removes the specified district-court appeal route for final firefighter pension benefit decisions by the board or pension benefits committee. This affects members and survivors seeking review of those decisions. The supplied provisions do not describe a replacement review process.

Fewer cities must establish firefighter funds

An incorporated city with a fully paid fire department must establish this firefighter retirement fund at a population of at least 2,000,000. The former threshold was 1,600,000. Cities below the new threshold no longer meet this population-based requirement.

City pension cost calculations change

The firefighter fund and city separately prepare risk-sharing studies using the entry age normal method instead of ultimate entry age normal. Their studies must follow actuarial standards. Police pension calculations use each employee's benefit rules, rather than newly hired employees' rules, and each member's benefit tier and normal costs. Beginning September 1, 2025, municipal pension studies under Section 9A(a) also use entry age normal instead of the ultimate method. The law states no resulting increase or decrease in city contributions.

Sponsors & Cosponsors

Sponsors

  • Sam Harless

    House

  • Joan Huffman

    Republican • Senate

  • Will Metcalf

    House

  • Tom Oliverson

    House

  • Mary Ann Perez

    House

  • Senfronia Thompson

    House

Cosponsors

  • Alma A. Allen

    House

  • Carol Alvarado

    Democratic • Senate

  • Jeff Barry

    House

  • Molly Cook

    Democratic • Senate

  • Harold V. Dutton Jr.

    House

  • Gary Gates

    House

  • Charlie Geren

    House

  • Lacey Hull

    House

  • Ann Johnson

    House

  • Jolanda "Jo" Jones

    House

  • Stan Lambert

    House

  • Penny Morales Shaw

    House

  • Christina Morales

    House

  • Dennis Paul

    House

  • Jon E. Rosenthal

    House

  • Valoree Swanson

    House

  • Cody Vasut

    House

  • Hubert Vo

    House

  • Armando Walle

    House

  • Charlene Ward Johnson

    House

Roll Call Votes

All Roll Calls

Yes: 434 • No: 1

House vote • 5/28/2025

Record vote

Yes: 132 • No: 1

Senate vote • 5/23/2025

Record vote

Yes: 0 • No: 0

Senate vote • 5/23/2025

Record vote

Yes: 0 • No: 0

House vote • 5/8/2025

Record vote

Yes: 146 • No: 0

House vote • 5/7/2025

Record vote

Yes: 137 • No: 0

Senate vote • Unknown

Committee vote: Finance

Yes: 13 • No: 0

House vote • Unknown

Committee vote: Pensions, Investments & Financial Services

Yes: 6 • No: 0

Actions Timeline

  1. Effective on 9/1/25

    6/20/2025House

  2. Signed by the Governor

    6/20/2025House

  3. Sent to the Governor

    5/31/2025House

  4. Signed in the Senate

    5/31/2025Senate

  5. Signed in the House

    5/30/2025House

  6. Reported enrolled

    5/29/2025House

  7. House concurs in Senate amendment(s)-reported

    5/28/2025Senate

  8. Text of Senate Amendment(s)

    5/28/2025House

  9. Statement(s) of vote recorded in Journal

    5/28/2025House

  10. Record vote (RV#3959)

    5/28/2025House

  11. House concurs in Senate amendment(s)

    5/28/2025House

  12. Senate Amendments Analysis distributed

    5/24/2025House

  13. Senate Amendments distributed

    5/24/2025House

  14. Senate passage as amended reported

    5/24/2025House

  15. Record vote

    5/23/2025Senate

  16. Passed

    5/23/2025Senate

  17. Read 3rd time

    5/23/2025Senate

  18. Record vote

    5/23/2025Senate

  19. Three day rule suspended

    5/23/2025Senate

  20. Vote recorded in Journal

    5/23/2025Senate

  21. Read 2nd time & passed to 3rd reading

    5/23/2025Senate

  22. Rules suspended-Regular order of business

    5/23/2025Senate

  23. Placed on intent calendar

    5/23/2025Senate

  24. Co-sponsor authorized

    5/23/2025Senate

  25. Committee report printed and distributed

    5/21/2025Senate

Bill Text

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