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29 Jul
0

TRS Board of Trustees Talks Budget, Plans for TRS-Care

The Teacher Retirement System of Texas (TRS) Board of Trustees met today, July 29, to discuss TRS-Care and budget requests that will be made to the Texas Legislature later this summer.

TRTA Executive Director Tim Lee provided impassioned public comment, approaching the trustees with heartfelt concern about the looming TRS-Care budget crisis.

Lee stressed that the participants in the retiree health insurance program pay $1.4 billion in revenue to sustain the program annually (35 percent of the program’s total revenue), while the state pays $300 million and school districts pay $150 million per year approximately. The health care plan covers 260,000 lives, and provides a vital, quality retirement benefit.

Lee also expressed that TRTA members are concerned about the $40 million in changes to TRS-Care that were approved by the TRS Board of Trustees during their June meeting. TRS is still working to enact those changes and develop a frequently asked questions list. In the meantime, our members may learn more about these changes by clicking here. Those changes will go into effect this September.

Lee communicated a deep desire for legislators, stakeholders and TRS to come to the table as quickly as possible to address the TRS-Care crisis.

A joint select committee on TRS-Care was established at the end of the 84th Legislative Session. The legislative members named to this group are: Senators Joan Huffman (R-Houston) – Co-Chair, Jane Nelson (R-Flower Mound), and Craig Estes (R-Wichita Falls); and Representatives Dan Flynn (R-Canton) – Co-Chair, Trent Ashby (R-Lufkin), and Justin Rodriguez (D-San Antonio).

On March 30, the committee held its first hearing to discuss TRS-Care, which TRTA reviewed in the Inside Line. During the meeting, each legislator was divided on how to approach the conversation of solving the TRS-Care crisis.

Though no additional public meetings of the select committee have been held yet, TRS Executive Director Brian Guthrie reassured all those listening that the committee members have been requesting information and “vetting and re-vetting” the potential solutions presented by Mr. Guthrie at the March 30 meeting.

While TRTA and other stakeholder groups do not know what direction the legislative study group intends to take at this time, the study group plans to present a comprehensive report on what they deem a correct course of action, and legislation will likely be filed that provides wide-ranging authority to the TRS Board of Trustees to make changes based on legislative direction. As Tim Lee stated, “we want to solve problems, that’s what we do, we work together.”

The TRS Board of Trustees and Executive Director Guthrie have your best interests as your fiduciaries at heart. Chairman David Kelly remarked, “we understand the crisis . . . and empathize with what TRTA members are going through.”

While progress on resolving the funding issues with TRS-Care may seem slow at times, please know that there are many groups—and many caring people—who are working on TRS-Care every day. TRTA’s visits to the Texas Capitol are not restricted to the 140-day session; in fact, we are visiting legislators and their staff members every week, asking for their support of your top priorities: affordable, quality health care, and protection of your TRS defined benefit plan.

What can TRTA members do to protect their vital health care benefits?

Please encourage others to join TRTA. Our membership exceeds 81,000, but there are more than 260,000 people in TRS-Care! If all 260,000 participants united with TRTA, we would stand a much better chance at funding this program adequately now and in the future.

TRTA members must recognize that the battle for health care funding will be very difficult. We have many friends in the Texas Legislature, but many are saying that fewer dollars will be available. TRTA is a successful advocacy organization because we find ways to work with our elected officials and make good things happen.

It takes hard work and a consistent effort to tell our story. It takes dedicated members willing to call and email their elected officials and let them know our TRS-Care program is in dire circumstances.

The struggle for more funding for the TRS-Care plan is underway already. The Texas Legislature must take a comprehensive look at how they fund this vital retiree health care program.

The changes made to TRS-Care in June may be viewed as a modest reduction in benefits for retirees; however, if the Legislature does not act to deal with this health care crisis, TRS-Care plan design and premium increases may make the plan unrecognizable compared to how we know it today.

Thank You

Thank you for your membership to TRTA. We will continue to follow the progress on TRS-Care, and provide you many more opportunities to get involved! If you are not yet a member, we need you to help us protect your retirement security. Please join TRTA today!

Be sure to like us on Facebookfollow us on Twitter and subscribe to our YouTube channel.

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20 Jul
0

TRTA Legislative Committee Meets, Solidifies Plans for 85th Texas Legislature

The Texas Retired Teachers Association’s Legislative Committee held meetings throughout July 18-19 to discuss the 2017 Texas Legislature. The committee is comprised of 21 members from the various TRTA districts.

It is the responsibility of the state Legislative Committee to communicate with their local unit counterparts to ensure a cohesive, well-organized lobbying effort throughout the interim and during the legislative session.


The Legislative Committee from left to right:
(Back row) Dr. Wayne Berryman, Paul Pearson, Dr. Charles Thompson, Jerry Pybus,
Billy Jack Rankin, Roger Huber, Dannie Hefner, Rueben Saenz, Terry Allen, Dr. James Warner,
Kenneth Hanson, Gayle Watkins, Charles Starcke. (Not pictured: Wayne Byrd)
(Front row) Paula Miller, Genoveva Castillo, Jack Teddlie, Bill Barnes,
Dr. Mary Widmier, Tonna Duke, Dr. Carole Ann Buchanan.

Many of the committee discussions centered on the issue of TRS-Care. TRS-Care is the health care program provided to nearly 250,000 retired educators by the Teacher Retirement System of Texas (TRS). The preservation of TRS-Care is paramount to the livelihoods of retired educators, and its funding system is in need of an overhaul.

During the 84th legislative session, TRS-Care required $768 million to remain solvent for the biennium. For 2017, that number could jump to $1.6 billion. Even as the funding for TRS-Care has come, the health care program has experienced significant changes to its benefits structure.

The TRTA legislative committee has made it a priority to communicate with legislators both before and during session about the best solutions to preserve the program, and to provide key resources to help the legislators make the best decisions.

The committee meeting also featured presentations from TRTA’s Pensions Consultant, Ronnie Jung, and TRTA’s Legislative Consultant, Vicki Truitt. Truitt’s presentation touched on the importance of the November elections and the preservation of the TRS Defined Benefit plan.

Josh McGee, the Vice-President of the Laura and John Arnold Foundation, is serving as the Chairman of the Pension Review Board. McGee is an out-spoken advocate for replacing defined benefit plans, such as the one provided by TRS.

Meanwhile, Jung detailed history of TRS-Care and how the health care program’s current operating budget is not in line with rising health care costs. Since the Legislature first created TRS-Care, the program has received funding from a pay-as-you-go strategy. Jung explained that the only way to ensure TRS-Care’s future is for the Texas Legislature to pre-fund the program.

While pre-funding TRS-Care is the most initially expensive option for the Legislature to consider, its long-term benefits would be enormous, as it would provide safety and security for retired educators’ health benefits. According to TRS estimates, the Legislature would need to invest $2.7 billion into TRS-Care during the 2018-19 biennium and $2.8 billion during the 2020-21 biennium to pre-fund TRS Care.

Additionally, the committee focused on federal lobbying to reform the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO). Recently, H.R. 711, a bill designed to reform the WEP and put money back into retirees’ pockets, suffered a major setback. TRTA and the legislative committee are determined to get the bill back on track and help the retirees who have been unfairly penalized since 1983.

Thank You

TRTA’s Legislative Committee is committed to providing consistent, clear communication with Texas legislators. You can find more information about the committee here. You can read the committee’s resource guide here and the training guide here.

Please be sure to like us on Facebook, follow us on Twitter and subscribe to our YouTube channel.

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13 Jul
0

WEP Reform a Difficult Road

Dear Friends,

Everyday I have the privilege to work with thousands of TRTA members and supporters on issues paramount to their retirement. The reform of the Windfall Elimination Provision (WEP) is one of the most impassioned and challenging efforts we deal with.

Like so many of you, we were disappointed that the help for current retirees may not be as much as we originally believed, certainly not as much as it should be. However, TRTA is right to support this current effort, and I wanted to offer some additional explanation to you before today’s vote.

Many of you have worked on this issue for years, decades even. TRTA pointed out when the WEP originally was passed it was a bludgeon against future retirees. Congress used the proverbial hammer when a scalpel may have been warranted. The issue that WEP was trying to address, that of non-covered Social Security years of employment (referred to as uncovered earnings), was an attempt to address benefit calculation issues with the SS formula.

For three decades, public workers have felt the effects of that hammer on their vastly reduced Social Security benefits. Many of you have offered true, compelling and heart-wrenching stories about how difficult it is to make ends meet because of a reduced SS benefit. So many of my friends have travelled to Washington, D. C. with me to argue against this very arbitrary and unfair law.

I started working for retired educators in 1996. That’s when I first learned about the WEP and the Government Pension Offset (GPO). I took up the torch with my good friend and former TRTA Executive Director Mike Lehr to convince Congress that WEP was more than unfair, it was punitive, and something needed to be done. Full repeal was and is the official position of TRTA! That’s what we have always championed and believe is the best solution to this issue.

Today, for the first time that I can remember, a U.S. House committee will put forward a bill that has a very real chance of passing and is viewed by many to be a far more fair way to address the WEP. The magnitude of this moment cannot and should not be lost in what is often times the hyper-charged world of politics and policymaking in D.C.

I wish I could adequately convey to you that this attempt, even if it is not everything all of us may hope to have, is a major step forward. You see, not everyone agrees that the WEP is a problem.

Many elected officials have their own solution to the WEP. They vary from “leave it alone and let it work the way it does” to “there is no problem with the WEP except that some people who should be affected by it do not get ‘caught’ in the current system and we need greater enforcement” to “if you want to get rid of the WEP, then your state public employees should be forced into Social Security.” While that final option may sound ideal, the reality is that decision would likely destabilize and ruin our Teacher Retirement System benefit plan.

We have often talked about the 14 states that are impacted by WEP and GPO. This can be misunderstood. There are about 14 states where public educators do not pay into the SS system while they are covered under their state’s teacher retirement system. We call this non-covered service. However, every state in the country has public workers that pay into a pension plan and may not pay into SS. The 14 states receive a lot of attention because educators, by and large, are the largest group of public workers impacted by the WEP and GPO because there are more public school employees than any other public servant. The WEP, though, hurts educators, state workers, firefighters, cops and millions of public employees across the nation.

Today is a big day. I have answered many emails and phone calls from disappointed TRTA members that the rebate portion of HR 711 has been reduced. Much of that reduction was a compromise on a portion of the bill called “enforcement.” There are many public workers who have retired and may have been misinformed about the WEP, or for some reason, inappropriately reported their government service and have not been “WEPed.”

The bill created a path to recalculating the benefits of those who have not reported their government service and “enforcing” the WEP on those it should have impacted but have “slipped through” for whatever reason. While “enforcement” has always been a part of the discussion, the removal of the provisions impacted the rebate amount for those retirees who adequately and truthfully reported their work history to SS. This compromise on the enforcement language in the legislation has taken a lot of the money off the table.

While it was right to look at the enforcement provision of the bill and offer a compromise, it was a costly price to absorb for retirees receiving the rebate. During this process we have also witnessed disagreements between two vitally important groups who serve Congress during these discussions. “Scoring” the bill (the process by which Congress is informed of the cost or the savings of an action) has been extremely difficult. The end result is that the Congressional Budget Office and the Social Security Actuary needed to come to some agreement on how the bill works and what its fiscal impact is over an agreed upon time horizon. The CBO uses a 10-year time horizon and the SSA uses a 40-year time horizon, vastly different approaches. Neither is wrong for their intended purpose, but when these two views collide, they make policy development incredibly difficult.

I know this sounds like internal policy mumbo-jumbo, and should not be our problem to correct. However, fiscal policy is not our only dilemma. Our coalition has dealt with numerous counter proposals, setbacks and impassioned disagreement within our own public employee realm on how best to deal with this issue. At the same time, we have met resistance to any change at all from other groups who do not think reform is warranted. There are plenty of other groups who do not represent public workers who view this revenue possibility in the SS system as their opportunity to seize available dollars and advance their issues while we sit on the sidelines or work out our differences. Ultimately, those groups hope we lose the momentum to help our members and future retirees.

There is always someone else, some interest or group in D. C., waiting to seize the moment and take a victory back to their members at a cost to someone else. Today, we have the chance to take a big step forward to help OUR members. We want to help all public workers impacted by the WEP. TRTA members have said to me “please do not let my daughter or my son, who is now a teacher, end up being hurt in the same way that I have been hurt by the WEP.” That plea has been made to me countless times, and was made with no regard to that person’s own benefit.

We have an opportunity today to help those future retirees. We have a chance to also help the current retirees receive as much as $720 a year, and that extra rebate will happen every year for the rest of that retiree’s life.

I could say to you easily that “TRTA supports full repeal and we will accept nothing less,” but many of you have told us that you do not believe complete repeal will ever happen and that something is better than waiting on nothing. TRTA is not abandoning the idea of complete repeal, but we will also not sit by idly. I will not sell you false hope that full repeal is just around the corner if we hold out until the next election or the next election after that. We have heard such things for decades.

Congressman Kevin Brady (our Texas Congressman!) is an honest man. He is a believer in public service. He is a good guy trying to bring dozens, even hundreds, of interests together to start addressing the horrible problems of the WEP and GPO. He has brought with him another good guy, Congressman Richard Neal, to the table to get this resolved. We all know Congressman Brady as a respected Republican from Texas. Mr. Neal is a respected Democrat from Massachusetts. These two men are working TOGETHER in a BIPARTISAN way to address an issue that has been left untouched for more than 30 years.

Every journey starts with the first step. We have all been trying to really get this process started, and it has been a long and difficult road. We need the House Ways and Means Committee to vote this bill out of their committee today and start the journey to helping our current and future retirees by putting money back in their pockets as quickly as possible.

We can, and will, always work for more. We need to start somewhere. Waiting for complete repeal has taken 30 long years already. TRTA members are tired of nothing getting in the way of something.

Please consider this a first step. We can make this better as we continue on this journey. Help us seize the moment in front of us. Ask your friends, family, fellow retired teachers, active educators, and anyone you know who is a police officer, firefighter or other public worker to support this effort. We need all the help we can get.

TRTA is going to do whatever we can to get you some much deserved relief. We will not give up on getting you the most possible, but this process cannot end today. We have all worked too hard to be told it’s better to wait with nothing to show for it.

Call your Congressman today and tell them we support Chairman Brady and Congressman Neal to reform the current WEP and to pass HR 711 out of the Ways and Means Committee. Click here to find your Congressman’s phone number (at the bottom of the page). Even if your Congressman does not serve on the Ways and Means Committee, let’s send a message to that they should pay attention to this bill and we will need their vote soon when this process takes us to the next step…a full vote by Congress supporting HR 711!

Your friend,

Tim Lee

Executive Director

Texas Retired Teachers Association

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