March 30, 1950 

_- 

Hon. Gordon H. Lloyd 

Executive Seoretary 

Employees Retirement 

System of Texas 

Austin, Texas 

Opinion No. V-1023. 

Re: Aaceptenee of contributlons to Retirement 

System of a former 

member for the period 

spent in military service in 1948 and 1949, 

the party having reDear Hr. Lloyd: 

turned to State employment. 

Your request for an opinion reads as follows: 

"Please favor us with your opinion, based 

on the following facts and interpreting Section 

V, Subsection Ii of H.B. 168, passed by the Regular Session of the 50th Legislature. 

"Mr. A, an employee of one of the State Departments, became a member of the Rmployees Retirement S stem on September 1, 1947. During 

August, 19 t 8, Kr. A left State employment and 

entered the Army. He received his discharge Deoember 31, 1949 and immediately returned to State 

employment. Hr. A now desires to make contributions to the Retirement System for the one year 

and four months while absent from State employment during this period of Mli,tary Service and 

desires such contributions to be deduoted from 

his monthly salary warrant and remitted to the 

Employees Retirement System as hkcontributions 

for such period of time. 

n1. Is the Bmployees Retirement System of 

Texas authorized to accept contributiona from Hr. 

A for the one year and four months while in Wilitary Service, based on fLve peraent of the monthly salary he was receiving at the time he entered 

Military Service? 

"2. If the answer to Question One is yes, 

can the State make Its matching contrlbutiona 
Eon. Gordon R. Lloyd, page 2 (V-1023) 

to the Employees Retirement System for the 

one year and four months? 

"3. If the answer to Question Two is 

yes, then would the Funds from which the employee was reoeiving hLs salary at the time 

of leaving to enter Military Service make 

the Stat8 oontributiona, or would the Fund 

from whiah the employee received his salary 

after returning to State employment make ths 

Stat8 contributions? 

“4. Would Mr. A receive tenure servioe 

for retirement purposes for the one year and 

four months while in Willtary Service?" 

Article 6228s, Section 5, Subseotlon H, Vernon's Civil Statutes, to which you refer, reads 8s follows: 

"Il. Credit for Military Service. 

"During the period of time the United 

States is in a state of war and for a period 

of twelve (12) months thereafter, time spent 

by a member of the Employees Retirement System (1) in the Armed Forces of the United 

States and their auxlliarles or In the Armed 

Forces Reserve and their auxiliaries, or in 

the American Red Cross, or (2) in war work as 

a direct result of having been drafted or conscripted Into said war work, shall count to: 

ward membership service. In addition, a member 

of the Employees Retirement System shall be 

permitted to contribute each year to the Retirement System a sum not to exceed the amount 

contributed by him to said Retirement System 

during the last year that he was employed as 

a member under the provisions of the Retirement Act. The funds so contributed shall be 

deposited to the credit of the member's individual account and shall be treated in the 

same manner as funds contributed by the member while he was employed by the State. Any 

employee of the State who entered military 

service prior to the establishment of the Retirement System, either by induction or enlistment, will be entitled to prior serviae 
,- 

Hon. GordonR. Lloyd, page 3 (V-1023) 

oredit for the time prior to establishment of 

the System and membership service for the time 

subsequent to the establishment of the System. 

Any employee so absent shall have the r.ight to 

olontrlbute to said System either during his 

aervLce with Armed Foroes or upon return an 

amount equal to the contrrbutiona whioh would 

have been made by him based on his compensation earnable at eommenaement of his- abseuoe, 

provided such employee re-enters the service 

of the State vithln sixty (60) days after the 

termination of his mllltary service and eleots 

to becom8 a member of the System within sixty 

(60) days after such re-employment. 

"In aomputing the average prior service 

compensation for employees who served Ln the 

Amed Forces 01% leaves of absenae from the 

State and subsequently became members of the 

System, that time spent in the Armed Forces 

shall be counted as part of the ten (10) years 

Immediately preceding the enactment of the law 

and the basis for oompensation shall be the 

same that was earned at corrmenaement of his 

leave of absenae from the State." 

Se&ion 8 of Article 6228a provides, in part: 

“A. The amount contributed by each member of the Retirement System shall be five per 

cent (5) of the regular annual oompensation 

paid to each member. The amount contributed 

by the State of Texas to the Retirement System shall not exceed during any one (1) year 

five per cent (5$) of salaries of ell~members, 

disregarding salaries in amounts in exoess of 

Three Thousand, 91x Hundred Dollars ($3,6oO), 

providing the total amount contributed by the 

State during any one (1) year shall at least 

equal the total amount contributed during the 

same year by all members of the ,Retirement 

System; provided further that all contributions made by the State shall be from and 

charged to the respective funds appropriated, 

allocated, and provided to pay the salary or 

compensation of the employee for whose benefit the contribution 2s made. . . D 

“2. State Membership Accumulation Fund. 
Eon. Gordon H. Lloyd, page 4 (V-1023) 

%!he State Membership Aocumulation Fund 

shall.be the fund in which shall be accumu- 

.lated all contributions made to the Employees 

Retir8m8nt System by,the Stat8 of Texas for 

the purpose of providing upon the r8tiPsment 

of eaah member an amount equal to swh memher's accumulated oontrlbutlon; and :from 

whioh shall b8 transferred to the Eemberahlp 

Annuity Reserve Fund at the retirement of a 

smmber an amount equal to the aooumu3.ated 

contributions of the member, Contributions 

to and payments from this fund shall b8 mede 

as follows: 

"a. The Stat8 of Texas shall pay each 

year in equal monthly installments into th8 

Stat8 I68mb8rShiLp Accumulation Fund an amount 

equal ~to a per oentum of the contributions 

of the membera during such year, which shall 

be calaulated by the Aotuary and oertifled 

to the Comptroller by the Stat8 Board 'of 

Trustees as b8ing the neoessary and requir8d 

per oentum to malntein a reserve in this fund 

equal to the present and prospective liablllties of the fund o q e 

"B. Collection of Contributions. 

v2. The collection of the State's contributions shall be made as follows: 

"a. From and after the date of th8 8stablishment of the smmbershlp and full operation of the Retirement System created by this, 

Aot takes effeat there is hereby ellooated and 

appropriated to the Emplogees Retirement System of Texas, in ecoordanoe with this Act from 

the several funds from which the ~8mploy8es ~. 

benefited by this Bat; receive their respective salaries, a sum equal to five per cent 

(5$) of the total compensation peid to the 

said ~esp8otiv8 employees who are membera of 

said Retirement System and whose colapsnsation 

IS paid from funds directly oontrolled by the 

State. The State Boerd of Trustees shall certify to theStat Comptroller of Public Aacounts and the Stat8 Treesurer at the end of 

8ech month the total amount of oomp8I3aatiOn 

paid sucrh members of th8 R8tiZWimOnt~SyStOm, 

4 

- 
Hon. Gordon H. Lloyd,'page 5 (V-1023) 

and the State Comptroller shall thereupon 

transfer five per oent (5$) of this amount 

from the said respeotive funds from which 

said employees are paid to the State Employees Retirement Fund; and which money'in said 

fund is hereby appropriated for the purposes 

provided by this Act for the balance of the 

fiscal year 1947 and the fiscal year 1948. 

Appropriations for the enaui 

3 

biennium shall 

be made aocordlng to Section , Subsection B, 

Part 2, Paragraph a, b, snd a of this Act. 

"b. Thereefter, on or before the first 

day of Wovember next preceding each Regular 

Session of the Legislature, the State Board 

of TrUIt88S shall certify to the Stat8 Board 

of Control for its review and adoption the 

amount neoessary to pay the aontrlbutions of 

th8 State of T8XaS to the Rmployeea Retirement System for the, ensuing biennial. This 

amount shall equal five per cent (!!$) of the 

total oompensation paid membera of the Retirement System and ahall be inaluded in the budget of the State whioh the Governor submits 

to the Legislature. The State Board of Truatees shall certify on or before August thirtyfirst of each year to the State Comptroller 

of Public Aocounts and the State Treasurer 

the estimated amount of oontributions to be 

received from members during the ensuing year. 

"c . All moneys hereby alloaated and appropriated by the State to the Bmployees Retirement System shall be paid to the Rmployees 

Retirement System in equal monthly installments based upon the annual estimate by the 

State Board of Trustees of the IEmployees Retirement System of the contributions to be 

received from the members of said System during said year, provided further in the event 

said estimate of the contributions of the members of the System shall vary from the actual 

amount of the employees' oontributiona during 

the year, then such adjustment shall be made 

at th8 olose of eaah fiscal year as may be required. Each of said monthly installments 

shall be paid into the State Membership Aocumulstion Fund and the Prior Service Annuity 
Hon. Gordon Ii. Lloyd, page 6 (V-1023) 

Reserve Fund in the proportionate amount certified by the ,State Board of Truste8s.n 

The following provisions were made in Senate 

Bill 391, Acts 5Gth Leg., 1947, ch.kOG,,,p. 91: 

"(29) All moneys oolleoted and reoelved 

by the,Employee's Retirement System of Texas 

under the provisions of House Bill Ro. 168, 

Acts of the Regular Session of the. 50th Legislature, 1947, during the biennium beginning 

September 1, 1947, together with the balances 

of swh funds on hand at the beginning of 

each fisoal year of the biennium, are hereby 

appropriated to the Employee's Retirement System of Texas for the purpose of oarrying out 

the provisions of said Act. The Employee's 

R8tiXWSOnt System Is hereby authorized to employ a suffioient number of employees to carry 

out the terms and provisions of said AOt, but 

in no event shall salaries be paid in exoesa 

of the amount paid for the same or similar 

poo;;;nt in any department of the State govl 

Appropriations for Stat8 Departments and Agencies were made in House Bill 322, Aots 51st Leg., R.S. 

1949, ch.615, p.1239. X8 quote the following provislons 

from Howe Bill 322: 

"There is hereby allocated and appropriated to the Employees Retirement System of Texas, 

In aooordance with H.B. Eo.168, Acts of the 50th 

Legislature, 1947, Regular 38saIon, from the 

several funds from whioh the employees receive 

their respective salaries and/or compensation, 

sufficient amounts to provide the State contributions neoessary to equal the five (s) per 

aent of the oompensatlon of the members, oontributed by them to the Retirement System, as 

provided in the Retilrtment Aot." 

It is our opinLon that the State la authorised to aocept contributions from Mr. A for the tLm8 spent 

by him in military serviae in 1948 and 199. It is provided in Subsection H, Scotion 5 of Article 6228a, that 

a pa&y who was a member of the Retirement System at the 

time of entering military serviae may contrfbute to the 

Retirement System for the time spent In such service. He 

- 
, 

-c- Hon. Gordon H. Lloyd, page 7 (v-1023) 

may contribute eaoh'year an amount not to ,exoeed the sum 

contributed by him to the Retir8ment System during the 

last year that he was, employed by the State and was a 

member of the Retirement System. 

In answer to your Question Ro. 2, it la our 

opinion that no provision has been made by the Leglslature for the State to match the contributions inquestion and that, consequently, no matching contribution 

can be msde by the State. The appropriation made to the 

Employees Retirement System for the purpose-of making 

the State's matching contributions was made "from the 

several funds from which the employees reoeive their 

respeotive salaries and/or compensation.* Mr. A vaa not 

receiving any salary or compensation-from a State Fund 

during the time that h8 was in military service. We are 

of the opinion that the faot that no provision has been 

made for the State's matahing contribution will not prevent the Retirement System from accepting the contrlbution of the person here involved. In view of our answer 

to Question Ro. 2, it is not necessary to answer Question No. 3. 

It is our opinion that Question Ro. 4 should 

be answered in the affirmative. Mr. A should be credited with membership service for retirement purposes for 

the time spent by him in military service, provided he 

has made oontrlbutions to the Retirement System acaording to the provisions of the Retirement Act. 

SUMbfARY 

A person who was in military service in 

1948 and 1949, and who was a member of' the 

Employees Retirement System of T8XaS at the 

time of entering military service, may oontribute to the Retirement System for eaoh of 

such years sn amount not to exoeed the sum 

aontributed by him to the ROtlr8ment System 

during the last year that he was employed by 

the State and was a member of the Retirement 

System. ,Such person should be credited with 

membership service for retirement purposes 

for the time spent by him in military servioe. 

Ro provision was made by the Legislature for 

the State to make a matohing contribution in 

,- 
Hon. Gordon B. Lloyd, page 8 (V-1023) 

swh oases, but that fact vi11 not prevent 

the Retirement Systemfrom receiving the 

contribution of the employee. 

Yours very truly, 

APPROVED: 

Red NoDaniel 

State Affaira Division 

Charles D. Mathews 

~8ClUtiV8 Assistant 

CBK:rt:jmarmw 

PRICB DAKIKL 

Attorney Ganeral