Blog

13 Apr
0

Senate Adjusts Budget Recommendations for TRS

Senate Recommendation Protects TRS-Care

 

Senator Finance Committee Restores Funds for TRS-Care and TRS Pension Fund

A proposal designed by Senator Robert Duncan (R-Lubbock) to protect TRS-Care participants from seeing a premium increase in the coming biennium, as well as restore over $100 million in funding for the TRS pension trust fund was adopted in the Texas Senate Finance Committee.

The budget proposal adopted in Senate Finance for TRS-Care will:

  • Fund TRS-Care in FY 2012 at 1 percent allowing TRS and the State to show a “maintenance of effort” in qualifying for additional federal health care dollars available through the retiree reinsurance program;
  • Fund TRS-Care in FY 2013 at 0.5 percent (the federal dollars are expected to be exhausted by that time);
  • Provide budget language that prohibits an increase in TRS-Care premiums for the coming biennium;
  • Sweep any excess budget dollars available through the annual “settle-up” from/to TRS in the budget process back to TRS-Care;
  • Provide for a study to be conducted in the interim that analyzes the TRS-Care program and offer suggestions on how to maintain efficiencies and implement new cost savings measures designed to protect the TRS-Care program;
  • This proposal adds $134 million back to TRS-Care funding for the biennium and ensures retirees that there will be NO premium increase in FY 2012 or FY 2013!

The budget proposal adopted in Senate Finance for the TRS pension trust fund will:

  • Provide for a state contribution to the TRS pension trust fund in FY 2012 at 6.0 percent;
  • Provide for a state contribution to the TRS pension trust fund in FY 2013 at 6.4 percent;
  • Temporarily suspends the requirement that the state contribution must be at least equal to, or greater than the active member contribution (only in FY 2012);
  • Maintains the active member contribution to the TRS pension trust fund for FY 2012 and FY 2013 at 6.4 percent;
  • This proposal will NOT make the fund actuarially sound, and it will NOT provide an increase to retirees, BUT it WILL restore over $100 million in pension trust fund contributions helping the system get to actuarial soundness sooner than later.

TRTA supports the Senate Finance Committee proposal. The Senate Finance Committee budget recommendation must still go to the full Senate for a vote. That will occur in the near future, but they have still not finished their overall proposal.

While this budget recommendation does not provide everything that TRTA is asking for to protect its members and address the issue of retiree loss-of-buying power, it does protect retirees from a huge increase in health care premiums that have been said to be as high as 80 percent.

The Texas House Budget proposal does much less to help TRS retirees and their plan would leave retirees susceptible to those massive TRS-Care premium increases. As this proposal is finalized, TRTA will launch an advocacy campaign asking the full Texas Senate to support this budget proposal for the TRS-Care program and the TRS pension trust fund.

TRTA will continue to update you on these issues as they develop. YOUR SUPPORT AND UNWAIVERING COMMITMENT TO WORKING ON THESE VITAL ISSUES HAS MADE AN IMPACT!

Thank you for your hard work and support!!!

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12 Apr
0

Private Information Compromised on Comptroller’s Web Site

Security Failure

Comptroller’s Office Makes Statement

An alarming statement was issued by the Office of Texas Comptroller Susan Combs yesterday. For over a year, that agency has left sensitive personal information about people in the Teacher Retirement System of Texas (TRS), the Texas Workforce Commission (TWC), and the Employees Retirement System (ERS) on an unsecured public server. This major security breach has exposed millions of Texans to the malicious actions of identity thieves and other criminals who may want to use such information to take advantage of public servants and retirees.

The Comptroller’s office is saying this security breach has now been closed and that an investigation into this issue is now ongoing. In addition, the Comptroller is working with the Attorney General’s office as part of this investigation.

The full statement from the Comptroller’s office can be read by clicking this link.

TRTA is very concerned about this matter and we will not rest until we are assured that security protocols are in place now to protect your identity at this agency. We have been advised that TRS members will be receiving letters in the mail as early as this week explaining this situation.

A special website and phone number are available from the State to answer your questions. The Comptroller’s Office does not believe there are any indications that this information was downloaded and used by cyber-predators, but it is too early to know and the proper measures MUST be taken by the State to protect your personal information.

TRTA is continuing to investigate this issue and we will post updates as they are available.

Please click here to read the Comptroller’s statement about the steps you can take to protect your identity.

Again, TRTA is not going to let this matter go unresolved. We will keep you updated on who may have taken this information and the risks it may pose to your identity. We know this is unsettling news and we will work together to see that the Comptroller’s office and the state address these issues appropriately.

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08 Apr
0

Health Care Funds Projected to Run Dry

TRS Projects Health Care Fund Out of Money by FY 2014

This week in the House Pensions, Investments, and Financial Services (PIFS) Committee hearing, Mr. Brian Guthrie (TRS Executive Director Designate) reported on how bad things may get for the TRS-Care health insurance fund if legislators do not restore funding to the program. One “worst case” scenario projected that the TRS-Care fund may be operating with a budget deficit as high as $585 million by the end of FY 2014.

These projections were based on proposed House and Senate budget reductions, and the expected increase of 7500 TRS retirements in the coming biennium. This would drain the TRS-Care fund of its $700 million surplus and result in a funding deficit of $265 to $585 million by FY 2014. With a funding shortfall that high, TRS is likely to consider reducing benefits, raising retiree premiums or both just to sustain TRS-Care through the coming biennium.

It is likely that the number of new retirements may be much higher due to legislative cuts to public education. Early in the session, the House PIFS Committee heard testimony that the number of retirements could be as high as 15,000.

The issue for all TRS retirees is that cutting TRS-Care funding at a time when the program must cover thousands of new individuals is a bad decision; one that will cost plan participants through increased premiums or fees.

TRTA is working every day with legislative officials on this issue. Many of these legislators are responsive to our suggestion to restore TRS funding, but little action has been taken to make this a budget priority. As many of you know, the last attempt in the House to restore TRS-Care funding was during the floor debate on HB 1 (the House budget bill). An amendment by Representative Garnet Coleman was deferred to a different section of the budget proposal and its fate is uncertain.

Budget discussions are still ongoing in the Texas Senate. TRTA is hopeful that the Senate’s effort to look for additional revenue sources may help restore funding to TRS-Care. State Senator Robert Duncan is chairing a special committee that is working to find revenue sources for the coming biennium. TRTA is involved in these discussions and we are working every possible lead to protect TRS-Care premiums.

TRTA Legislative Initiatives

A number of bills have been introduced to provide retirees with a supplemental payment this session. We are hopeful that the House PIFS Committee and the Senate State Affairs Committee will provide a hearing for these bills soon.

Specifically, the legislation filed in the House and Senate that may provide a supplemental payment in the coming biennium includes:

  • HB 1699 by Representative Jose Menendez: provides that TRS pay a one-time supplemental payment directly out of the pension fund;
  • HB 2150 by Representative Craig Eiland: provides that TRS pay a one-time supplemental payment directly out of the pension fund;
  • HB 2341 by Representative Allen Ritter: provides for additional opportunities for the TRS Board to determine the fund’s actuarial condition and its ability to provide retirees with a supplemental payment;
  • HB 3542 by Representative Larry Gonzales: provides that retirees receive a supplemental payment from investment proceeds that exceed an 8 percent investment target; and
  • SB 1333 by Senator Robert Deuell: provides that retirees receive a supplemental payment from investment proceeds that exceed an 8 percent investment target.

TRTA is meeting with members of the House PIFS Committee and the Senate State Affairs Committee asking that these bills receive a timely hearing. We appreciate these legislative members for thinking of new and innovative ways to try to help TRS retirees during difficult economic times.

Still Time to Get Things Done

Time to get things done this session is disappearing quickly. TRTA members have done an outstanding job of making legislators aware of our issues. Some legislators have even commented that TRTA members are doing too good of a job communicating with their legislative offices. TRTA is undeterred, as we know there are thousands of interest groups contacting legislators about their issues.

TRTA must, and will, make our voices heard. The good news is that public education retirees are active, articulate, focused voters! Our participation in the legislative process is making a difference for hundreds of thousands of TRS retirees.

Thank you for your hard work on behalf of TRTA. Your dedication does not go unnoticed and we are grateful for your willingness to engage your elected officials. We will keep you informed about the progression of TRTA’s legislative agenda and all budget news as it is updated.

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