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Legislative Updates

Legislative Update No. 9, Session 79
By Tim Lee, Executive DirectorPrinter Friendly ||| Print as PDF

March 19, 2005

Texas Retired Teacher Association (TRTA) members and legislative team members testified in favor of HB 1579 at the House Pensions and Investments Committee on Thursday, March 17, 2005. The legislation is being sponsored by Representative Lois Kolkhorst (R-District 13) as a measure to recoup lost revenue to the Teacher Retirement System of Texas (TRS) pension trust fund when districts rehire retired educators who return to work prior to the end of 12-month wait-out period.

HB 1579 requires school districts that rehire retired educators that do not meet the 12-month exclusion to pay the full 12.4 percent contribution (6.4 percent active share + 6 percent state share) to the TRS pension trust fund to make the system whole due to the lost revenue of not hiring a new active teacher for the position. The legislation also tightens restriction on rehiring practices, as well as requiring the district to pay the full state cost of TRS-Care for the retiree.

The legislation could generate as much as $130.4 million for the TRS fund, and nearly $64.1 million for TRS-Care.

TRTA supports this legislation as a way to eliminate cost factors that are destabilizing the actuarial soundness of the TRS pension trust fund as well as adding additional liabilities to the TRS-Care program.

Many groups testified on the bill; however, several of the active teacher and administrator groups wanted to see some revisions made so that school districts in acute shortage areas would have more choices of who they could hire back, as well as leaving options open to school districts for substitute teacher and school administrator positions.

Only one group testified that the 12.4 percent contribution was not something they would like to see going to the system, but suggested a model such as the Ohio method of retire/rehire rules be put into place. That system allows retired/rehired educators to contribute to the system and then receive those contributions back, with interest, at the end of their teaching time (or at age 65). TRTA is looking at this proposal, but it is unclear as to how this approach would help solve the TRS-pension trust fund issues. Tim Lee, TRTA Executive Director, noted that the Ohio system is only 77 percent funded and their unfunded accrued actuarial liability (UAAL) repayment is in excess of 42 years. “This may not be the best place for us to look to get our solutions,” commented Lee.

HB 1579 is pending for additional committee action. Representative Kolkhorst expressed her desire to work with the interested groups to make the bill stronger, and TRTA will support these efforts.

Please contact TRTA at 1.800.880.1650 or email to trta@trta.org if you have any additional questions.
 

TRTA 79th Legislature Bill Tracking:

Bill Number	Sponsor	Party-District	Synopsis
HB 1 SB 1	Pitts Ogden	R-10 R-5	Relating to appropriations of state government for the 2006-2007 biennium.
HCR 63 SCR 5	Noriega Gallegos	D-145 D-6	Urging Congress to repeal the Government Pension Offset provision and the Windfall Elimination Provision of the Social Security Act.
HB 346	Escobar	D-43	Relating to the amounts to be appropriated for the state contribution to the teacher retirement program for fiscal years 2006 and 2007.
SB 482	Shapiro	R-8	Relating to the retirement benefits payable to retirees of the Teacher Retirement System who are employed as teacher mentors.
HB 566	Brown, Fred	R-14	Relating to eligibility for group benefits coverage for certain government employees and retirees.
HB 583	Zedler	R-96	Relating to the creation and operation of a statewide risk pool to provide health benefits coverage to active employees of school districts.
HB 633	Kuempel	R-44	Relating to participation and credit in, contributions to, and the benefits and administration of the County and District Retirement System.
HB 844 SB 329	Gonzales Hinojosa	D-41 D-20	Relating to retirement benefits of certain teachers.
HB 916	Woolley	R-136	Relating to creating the Governor's Health Care Coordinating Council.
HB 1064	Delisi	R-55	Relating to creating the Governor's Health Care Coordinating Council.
HB 1198	Guillen	D-31	Relating to public education, public school finance, a state property tax and related matters.
HB 1416	Martinez	D-39	Relating to health insurance benefits provided to certain public school retirees and their dependants.
HB 1463	Flores	D-36	Relating to the payment of monthly benefits to certain retirees of the Teacher Retirement System who return to work.
HB 1579	Kolkhorst	R-13	Relating to eligibility for benefits of and reports concerning certain retired members of the Teacher Retirement System.

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