Blog

04 Nov
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TRTA Update on Charitable Assistance, and Laura and John Arnold Foundation continue to attack Public Pension Plans

November Is Foundation Month! 

November has been designated by the Texas Retired Teachers Association (TRTA) as a time to raise awareness of the good deeds of its charitable partner organization, the Texas Retired Teachers Foundation (TRTF). The Foundation also wants to express its gratitude to all TRTA members and our friends.

Due to your generosity, TRTF has changed many lives by providing financial assistance to retirees in need through the “A Helping Hand” program, Student Scholarships and Classroom Assistance Grants.  The Foundation’s educational program, known as the Legacy Campaign, continues to promote a positive image of public education in Texas.

You should have received the Foundation’s annual appeal letter in your mailbox recently. The letter stresses how we as former educators are leaving a legacy of helping our own. A TRTA member from Laredo immediately responded to the letter with a $500 donation. She is celebrating her 100th birthday on November 5th! Another member donated one dollar. Both members understand the importance of our “A Helping Hand” program and have offered their heartfelt support.

Though not everyone can respond with a donation, there are many ways you can help share the good deeds of the Foundation this month! Sharing our newest Legacy educational video, “Preserving the Legacy: Actives and Retirees Working Together,” (http://www.youtube.com/watch?v=qPXobFBLr5A) is a great way to get involved. Telling retirees who may need financial help about “A Helping Hand” is another way to help our own! Just this week, the Foundation received a call from a retiree who has no extra money to repair a flat tire. When thinking of your family and friends this holiday season, please consider your TRTA family.

For more information about how you can participate, contact Beth Unite at 1.800.880.1650 or help@trtf.org. If you wish to make a donation online, please visit the Foundation web page www.trtf.org.

Public Pensions Being Debated Across the Country  

Although TRTA and its members had a successful legislative session in 2013, protecting and improving the Teacher Retirement System of Texas (TRS) pension plan, the debate about public pension plans is as divisive as ever.

Many of our members have heard of the Laura and John Arnold Foundation and the organization’s opposition to traditional defined benefit pension plans (the type Texas retired and active education employees rely upon for their own retirement security). In 2013, The Arnold Foundation partnered with the Pew Research Center. Together, both organizations hosted a conference in October of this year entitled “Summit on Sustainable State and Local Retirement Systems: Responsible Stewardship of Public Funds and Fairness for Employees.”

The conference featured the opposing viewpoints of many legislative officials and experts, with some claiming that defined benefit plans are not sustainable for the long-term and are unfair to future generations and others asserting the failure of 401(k)-style plans (defined contribution plans) and support of DB plans. The conference presented data that most Americans support DB plans for public sector workers, such as teachers and public safety employees.

While normally any conference presented by the Arnold Foundation might be skewed towards complete opposition of DB plans, the presence of many state officials and public sector organizations made for a more balanced event.

The National Council on Teacher Retirement (NCTR) summarized the event with the following words of advice: “no one should be under the impression that this particular challenge is over or abating.” A conference attendee reiterated that sentiment by saying “I think the DB opponents sense an opportunity to strike.”

It is important to note that Texas was not represented at this conference. The bipartisan, sensible changes made to TRS in 2013 through Senate Bill 1458 would make for a very informative panel discussion. Though Texas is truly a model for what a sustainable pension plan can be, we are still at risk of attack from DB opponents.

Yet another conference held recently, “Save Our Cities: Reforming Public Pensions to Protect Public Services,” was not as fair in its discussion of DB plans. Joshua Rauh, a professor from Stanford, proclaimed that “there is really no state or local government across the U.S. that sponsors any kind of DB pension plan that has really run a balanced budget.” Former Los Angeles Mayor Richard Riordan, who supports converting DB plans to DC plans, stated that “in the next several years, you are going to see city after city, state after state, go bankrupt.”

This is exactly the type of rhetoric that our own legislators hear when they attend conferences. Our members should remain focused on communicating with candidates for office and talk to them about the value Texas TRS brings to its 1,000,000+ members. In the 84th Legislative Session that begins in 2015, the Texas Legislature will have several new elected officials, including Representatives, Senators and even a new Governor. More than half of the Texas Legislature will have two years or less experience in office.

TRTA must start its campaign to educate candidates and future legislators NOW. As former educators, we must embrace the opportunity to teach candidates about what makes Texas TRS different from pension plans in some other states. Texas TRS currently is actuarially sound. Its retirees have an average monthly income of $1800 and most do not have Social Security benefits. The plan is modest and absolutely necessary for the retirement security of more than 300,000 retirees and 800,000 pre-retirees.

It is also important that we talk to current public education employees about TRS. Many are unaware of the two federal provisions that drastically reduce or completely eliminate any Social Security benefits they may be eligible for (even spousal benefits) and that TRS is their sole source of retirement security! We must work together to protect and sustain the TRS pension plan for our own generation and the generations to come.

Did you know active school personnel can also join TRTA? As we visit with current employees about planning for their future, let’s also share the benefits of being a member of the nation’s largest association of public education retirees. For information about how to join TRTA, please contact us at 1.800.880.1650 or visit www.trta.org.

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16 Oct
0

Social Security Administration Looks to Texas for Offset Revenue

Click here to send an email asking your Congressmen to fight against SSA’s attempt to reduce your benefits!

TRTA members are not the only people happy to see the Texas Legislature provide an increase to Teacher Retirement System of Texas (TRS) retirees who retired as of August 31, 2004 or before. The Social Security Administration (SSA) has also learned of this news and is preparing to reduce TRS retirees’ Social Security checks that are impacted by the Government Pension Offset (GPO).

It is vital that we all know what SSA benefits are being impacted in this most recent attempt by the federal government to take money from our TRS retirees. As many of you know, there are two Social Security provisions that reduce or eliminate a TRS retiree’s annuity.

One of these provisions is called the Windfall Elimination Provision (WEP). This provision reduces the Social Security income of an individual based on his or her OWN work history. An example is a TRS employee who worked during or after her school employment (during which she did not pay into Social Security) in a new position where she did pay into Social Security. This work history results in 40 or more “earned quarters,” at which point the retiree becomes eligible for a Social Security benefit. The WEP is applied to this person’s Social Security income because she receives a pension. The WEP reduces her Social Security benefit by up to two-thirds. The WEP does not eliminate the Social Security benefit completely.

While many TRS retirees are impacted by this provision, the recent increase in TRS annuity amounts will NOT have ANY impact on a retiree’s personally earned Social Security benefit.

The other Social Security provision, the one that the SSA is using to target TRS retirees, is the Government Pension Offset (GPO). The GPO reduces the Social Security benefit that a TRS retiree may qualify for based on their spouse’s work history. If a TRS retiree qualifies for a spousal benefit (this could also be a widow’s/widower’s benefit, or auxiliary benefit), the SSA implements a formula to reduce or eliminate the Social Security amount.

For example, when Jane receives a TRS benefit of $1,800 per month from her work with an ISD that did not pay into Social Security and her husband passes away, she is eligible to receive a portion of his Social Security benefit. Normally, the spousal benefit she is eligible to receive based on her spouse’s work history is $1,500. However, Social Security knows Jane receives a pension. The GPO formula therefore is used by the SSA to offset her spousal benefit. Her Social Security benefit will be reduced by two-thirds the amount of her pension.

In our example, the offset looks like this:

$1,800 (Jane’s TRS) X 2/3 = $1,200 (this is the offset amount)
$1,500 (Jane’s eligible spousal benefit) – $1,200 (calculated offset) = $300/month Social Security (what Jane actually receives)

As you can see, Jane’s Social Security was not completely offset in this example, but in MOST cases the GPO does eliminate a retiree’s eligible spousal benefit completely.

Those fortunate enough to still qualify for their spousal benefit are told that future cost-of-living increases in states that have annual COLAs will continue to reduce the remaining spousal benefit. The SSA counts on these state COLAs to increase their revenue projections. If the SSA stopped this practice, it would reduce their budgeted revenues for the year.

Texas TRS annuitants are not promised cost-of-living increases. It would be impossible for the SSA to budget an increase in their “revenue” for the year based on the Texas Legislature authorizing the increase that was just implemented for TRS retirees on October 1, 2013. However, this is not stopping the SSA from taking the opportunity to realize a “windfall” of its own.

TRTA has learned that many of our members who qualify for a reduced Social Security spousal benefit are now receiving letters from the SSA asking what their new annuity amount is with the 3% increase.

There can be no doubt that this information is being requested to further reduce retirees’ Social Security spousal benefits. While this is our belief, we have reached out to the SSA for an official comment.

TRTA anticipated that SSA would attempt to reduce our retirees’ Social Security benefits. For over a month, TRTA officials have made multiple trips to Washington, D.C. to ask our Congressional members to intervene.

TRTA believes the GPO and the WEP should be repealed. This is a hotly debated issue in Congress and it has gained little traction for many reasons, but mostly because the SSA and Congress rely on GPO and WEP to bolster the financially troubled Social Security program. Some members of Congress are working hard to implement an even more devastating provision known as “mandatory Social Security,” which has the potential to destroy the state funding for our Texas TRS pension trust fund.

While all this is being debated in a Congress that is deadlocked and shutdown, Texas TRS retirees may see the state provide the first increase in over 12 years and the federal government nullifies much of that benefit by taking the money for themselves.

This is an outrage that EVERY member of the Texas Congressional Delegation should rise up against!

TRTA is calling on Congress to put a stop to allowing the SSA to further harm our TRS retirees who already are impacted by the GPO. In lieu of a complete repeal of the GPO, there must be an immediate freeze on any further reductions of Social Security benefits that already have been reduced by the GPO.

TRTA believes that Congress must impose a “one-and-done” strategy to protect our TRS retirees right now! The SSA never counted on these revenues in their budget projections; therefore, there is no cost to the federal government!

TRTA also calls on Congress to have a real conversation about the elimination or modification of the GPO and WEP. These two reductions harm retirees who are on fixed incomes and are detrimental to attracting the best and brightest educators to our classrooms.

TRTA has met with numerous Congressional members including Representatives Sam Johnson, Kevin Brady and Lloyd Doggett as well as the staff members of numerous other Congressmen, all of whom have responded favorably to working on a solution to this immediate threat to our TRS annuitants.

TRTA encourages our members to contact their Congressmen and tell them to prevent the SSA from further harming TRS retirees impacted by the GPO. Click here to use our new campaign that makes it easy for you to email your Congressmen today! You can edit this email to include information about how the GPO affects you personally. We will also update you regularly as we work with our Congressional members. Please send us your feedback on this important issue.

TRTA is strong because our members are active, vocal, and organized. Let’s send a message to Washington that now is the time for real action! This government needs to get back to work and solve problems that will impact their Texas constituents!

We need EVERY TRS RETIREE to join in our advocacy efforts! Other groups are spending billions of dollars to intimidate and cajole legislative members into doing nothing to help their public servants. While these groups are more interested in score cards and political maneuvering, TRTA members are interested in results. Our legislators need to know that while the billionaires may be trying to buy influence there is one thing their dollars cannot buy: YOUR VOTE!

TRTA members are watching, and we are prepared to go to the polls and cast our votes for those who get things done. Let’s send Congress a real wake-up call and let them know that real Texans, vulnerable retirees who are on fixed incomes, are about to be hit right in their pocket books if Congress does not intervene against the Social Security Administration.

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30 Sep
0

Cost-of-Living Increase Going Into Effect October 1

Click Here to Send Your Legislators a “Thank You!” Letter and remind them there is still much work still to be done for ALL TRS Retirees!

On Tuesday, October 1, 2013, 200,000 public education retirees in Texas will receive their first permanent cost-of-living increase since 2001. This is the result of the passage of Senate Bill 1458, which was conceived and completed during the 83rd session of the Texas Legislature this year.

SB 1458 provides for a cost-of-living increase of 3% (not to exceed $100 per month) for retirees of the Teacher Retirement System of Texas (TRS) who retired as of August 31, 2004 or before. If you fall into this category, you will see the increase in your annuity in your October paycheck.

SB 1458 was authored by Senator Robert Duncan and Representative Bill Callegari. After months of discussion between legislators, TRTA, and active teacher groups, the bill’s final version passed unanimously in both houses of the Texas Legislature. The support that was shown for retirees this past session was astounding!

Not only did SB 1458 provide financial relief for most retirees, it made the pension fund actuarially sound for the first time in many years. According to state law, pension increases such as the COLA being provided in October are not possible legally unless the pension fund is actuarially sound.

Being actuarially sound is very important not just to provide increases for retirees, but to preserve the fund for the long term. TRTA’s primary goal is to ensure that the TRS fund remains intact for all current and future retirees and that the defined benefit plan is maintained. A defined benefit plan ensures retirees an income for the rest of their lives, as opposed to a defined contribution plan which retirees can outlive. This is especially important since most Texas school employees have little or no Social Security as part of their retirement.

For this reason, TRTA believes it is important that we show our appreciation to all of our Texas legislators! Some of you may not have received the COLA this year, but because the fund is stable, the likelihood of future increases for more retirees is significantly higher.
TRTA has not forgotten about you, and we continue to work even now talking to legislators about increases for ALL TRS retirees in future sessions.

Please take a moment to send a note of thanks to your legislators today! (click here to send email)

The work of TRTA members is never done, and though we achieved a major victory this past legislative session, we have several issues that must be addressed now. Our next focus must be on the TRS-Care health insurance program. Over 200,000 retirees and their dependents rely on this program, which is expected to have a shortfall of over $1 billion within the next two to three years.

Now is the time to get in touch with your legislators and ask them about their plans for protecting TRS-Care. Is it vital that you share your opinions with them about what changes to the program you can and cannot accept. It is very possible that a restructuring of TRS-Care could lead to a reduction in benefits, an increase in premiums, or both!

Take advantage of your legislator’s presence in your home district to call them or set up an appointment to meet with them.

Thank you for being a member of the nation’s largest organization of public education retirees! If you are not a member of TRTA and are interested in joining in our grassroots efforts to improve benefits for all TRS retirees, please contact us a 1.800.880.1650.

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