Texas Government Code - GOV'T § 825.408. Interest on Contributions and Fees; Deposits in Trust

(a) Except as provided by Subsection (a-1), an employer that fails to remit, before the seventh day after the last day of a month, all member and employer deposits and documentation of the deposits required by this subchapter to be remitted by the employer for the month shall pay to the retirement system, in addition to the deposits, interest on the unpaid amounts at an annual rate compounded monthly and a late fee in an amount determined by the retirement system that is based on the size of the employer and may not exceed $1,000 for each business day after the deadline imposed by this subsection that the employer fails to submit the documentation of the deposits. The cumulative amount of late fees assessed against an employer under this subsection may not exceed $25,000 per reporting period. The rate of interest is the rate established under Section 825.313(b)(1), plus two percent. Interest and late fees required under this section are creditable to the interest account. On request, the retirement system may grant a waiver of the deadline imposed by this subsection based on an employer's financial or technological resources. The retirement system may establish a process for filing an appeal to reduce or waive a late fee imposed under this subsection.

(a-1) This subsection applies only to an employer who reports the employment of a retiree to the retirement system. Subject to Subsection (a-2), an employer that fails to remit, before the 11th day after the last day of a calendar month in which a retiree is employed, the employer deposits required by Section 825.4092(b), documentation of those deposits as required by this section, and the certified statement of employment required by Section 824.6022 shall pay to the retirement system, in addition to the deposits, interest on the unpaid amounts at the annual rate established under Subsection (a), compounded monthly, and a late fee in an amount determined by the retirement system for each business day after the deadline imposed by this subsection that the employer fails to file the documentation of the deposits and the certified statement of employment.

(a-2) If a retiree described by Subsection (a-1) performs work in the month of August, the employer must remit the employer deposits, documentation of those deposits, and the certified statement of employment before the seventh day of September.

(b) An employer and its trustees or other governing body hold amounts due to the retirement system under this subtitle in trust for the retirement system and its members and may not divert the amounts to any other purpose.