Relating to certain distributions from deferred retirement option plans established under public retirement systems for police and firefighters in certain municipalities.

HB 3987 allows police and firefighters in participating Texas municipalities with Deferred Retirement Option Plan (DROP) accounts to access funds under specific hardship conditions. The bill permits partial or full lump-sum distributions from DROP accounts when facing unforeseeable financial hardship (e.g., medical emergencies), with the retirement board required to establish clear hardship criteria. It also updates beneficiary rules, automatically designating a spouse as the beneficiary unless otherwise specified, and prohibits denying hardship withdrawal requests. This bill directly affects public safety employees enrolled in municipal DROP programs by expanding their access to retirement funds during financial crises.