Blog

17 Feb
0

Funding Health Care and Pensions a Top Priority

Texas House Appropriations Subcommittee on Education members have closed testimony on the Teacher Retirement System budget request. Thank you to everyone who emailed and voiced your concern to these members asking them to restore cuts to the TRS pension fund and the TRS-Care health insurance program.

Tim Lee, TRTA Executive Director, testified during today’s hearing. TRTA is emphasizing the importance of restoring cuts to the TRS-Care health insurance program.  Earlier in the day, the Teacher Retirement System testified that with a reduction in TRS-Care funding the plan’s projected balance surplus through FY 2014 is $66 million. Managing a health insurance plan with over 200,000 lives and a projected fund balance of $66 million is very difficult to do without considering increasing premiums. TRTA is concerned that the proposed budget cuts will force TRS plan administrators to consider a premium increase in the coming biennium.

TRTA has worked with the legislature for the last 3 sessions to keep retirees from receiving a premium increase. At a time when pension benefits were not increasing, neither were health insurance premiums. This has helped ease the burden on many public education retirees. But, if the proposed budget cuts are not restored to TRS-Care the legislature will be passing the cost of covering those cuts on to you through increased premiums.

Mr. Tom Rogers, TRTA member in Austin, testified that adequately funding the pension trust fund is in the best interest of all Texans. Mr. Rogers discussed the high-value economic impact TRS pensioners generate through spending their pension dollars in Texas. This creates tax revenue for the state and jobs for many thousands of Texans. Mr. Rogers further pointed out that TRS retirees have lost nearly 30 percent of their buying power since the last time retirees received a permanent increase in their pension benefits.

TRTA members are making their voice heard on these cuts and the need to find a way to help retirees this session. Other members of the Austin Retired Teachers Association also appeared before the committee voicing their concerns and registering their position against cutting the budget.

The legislative committee members worked for over 12 hours in yesterday’s hearing. As public testimony in the House subcommittee is now concluded, the TRTA link to communicate with these members has expired. We will, though, continue to advocate for restored funding for the TRS pension trust fund and the TRS-Care health insurance program and will provide you with additional email advocacy campaigns during the session.

Thank you to everyone who sent emails and watched today’s hearing. Your dedication and service to TRTA is greatly appreciated.

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10 Feb
0

TRTA Inside Line: Higher Federal Tax Withholdings

“Why Has My TRS Check Decreased?”
 
TRS Retirees Feeling a Federal Tax Squeeze
 
Many TRTA members are asking why their monthly annuity has suddenly decreased. Retirees are reporting a decrease that ranges between $30 per month to as much as $50 per month. The answer is that the federal government is taking a bigger bite out of your monthly income through higher tax withholdings.
 
One of the first questions I have been asked is “if the Bush-era tax cuts were extended, why am I paying more?” Part of the answer is that President Obama and the previous Congress extended the reduced tax bracket amounts that have been in force since President George Bush’s term. The tax brackets, however, were expanded to include more people at the higher taxable amounts. While the tax rates did not change, a person may fall into a new tax bracket with a higher tax rate due to this expansion.
 
In addition, President Obama and the previous Congress enacted the Payroll Tax Holiday. This is a separate issue entirely and it reduces a different item in the taxing structure. The Payroll Tax Holiday reduces the Social Security tax withholding, or the FICA-OASDI tax amount. TRS retirees do not benefit from this Tax Holiday, because TRS does not deduct FICA-OASDI taxes from a retiree’s annuity check.
 
In 2009 and 2010 there was a “Making Work Pay” credit in effect as part of the American Recovery and Reinvestment Act.  This expired on 12/31/2010, meaning that many people will notice an increase in the amount of Federal Withholding deducted.
 
The combination of the change in the federal withholdings and the expiration of the “Making Work Pay” tax credit are taking a significant bite out of many retirees’ pay checks.
 
What can be done?
 
TRTA members can contact their Congressional members and let them know that these tax increases are making a bad situation worse in Texas. Congressional members need to know that TRS retirees have not had a pension increase in 10 years and have already lost as much as 30 percent of their buying power! Any additional reduction has a real and detrimental impact on retirees’ fixed incomes.
 
Additionally, Congress should find a way to eliminate the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP) which impact so many TRTA members.
 
Thank You
 
We know that TRTA members are already engaged in this very hard state legislative budgeting process. Texas legislators have received more than 15,000 emails from TRTA members! You are doing an excellent job in promoting TRTA’s major budget initiatives: the restoration of funding for the TRS-Care health insurance program and the TRS pension trust fund. We need to protect our health care premiums and find a way to provide retirees with a real benefit increase.
 
TRTA members are doing a lot to help advance our legislative priorities. The level of activity is increasing all over the state and legislators are responding. Many have contacted TRTA to arrange meetings on the issues important to you. This is great news and we appreciate all you do to make legislators aware that our issues should not be moved to the back burner.
 
Thank you for your efforts and for your support of the Texas Retired Teachers Association!
 
 

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07 Feb
0

TRS Hires New Director

Current Deputy Director will take Lead Role September 1


The Teacher Retirement System of Texas (TRS) met today to interview candidates and hire a new system Executive Director. Mr. Brian White of the San Diego Employees Retirement Association and Mr. Brian Guthrie, currently serving as the TRS Deputy Director, were interviewed for the position. The TRS Board of Trustees voted to hire Brian Guthrie effective September 1, 2011.

 

The TRS Executive Director search began last year when current director, Mr. Ronnie Jung, announced plans to retire. The TRS Board named a search committee and hired an executive search firm to field qualified candidates.

 

The search firm reviewed more than 100 candidates and narrowed the results down to three recommendations. One of the top three candidates withdrew from consideration, leaving Mr. White and Mr. Guthrie as the top two choices for consideration by the TRS Board of Trustees.

 

While Mr. White’s experience in the private sector and with the San Diego Employees Retirement Association is impressive, the Trustees selected the internal TRS candidate to head the system. TRTA has worked with Mr. Guthrie since he joined TRS in 2008. Brian has worked diligently in his capacity as the TRS Deputy Director and is a regular speaker for TRTA local units around the state. We look forward to working with Brian as he transitions into this new role.

 

Ronnie Jung, TRS Executive Director, will remain in his position through August 31, 2011. The TRS Board voted to retain Mr. Jung as an executive liaison, where he will assist Mr. Guthrie and the trustees during a transition period through Jan. 31, 2012.

 

TRTA commends the TRS Board on an open search process for this critical position. Mr. Linus Wright, TRS Annuitant Trustee, served as Chairman of the Executive Search Committee. Mr. Wright’s work is greatly appreciated. Hiring an Executive Director is a very daunting task, but the work invested by the TRS Trustees, their commitment to an open process, and the many opportunities that were provided for public input have made this a smooth process. TRTA will continue to represent you in EVERY TRS Board meeting, and we will work with these critical state leaders to ensure that your fund is managed effectively.

 

Additional Information

TRTA State Legislative Committee members begin a month-long advocacy effort to promote our TRTA legislative agenda. We will follow up with legislators on your email advocacy campaign to restore funding to the TRS pension trust fund and the TRS-Care health insurance program. Over 14,000 emails have been sent to legislators since last week asking for these cuts to be restored.

 

We will update you on these meetings and all important legislative activities as the week progresses.

 

Thank you for your support on these vital issues. We appreciate your service on behalf of the TRTA.

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