Blog

21 Jun
0

Congressman Richard Neal Releases Statement Addressing WEP Reform Efforts

Representative Richard Neal (D – Massachusetts) is serving as the new chairman for the Congressional Ways and Means Committee in Washington, D.C. As the chairman of Ways and Means, he has oversight on the Windfall Elimination Provision (WEP), which has long been a drain on retired Texas educators.

The WEP, which took effect in 1983, provides a means of eliminating the “windfall” of Social Security benefits received by beneficiaries who also receive a pension based on work not covered by Social Security.

Ninety-five percent of Texas public school employees do not pay into Social Security through their work with Texas schools. However, many have other jobs before, during, or after their employment in education in which they do pay into the federal program.

Neal has released a statement addressing his progress a new bill that would benefit retirees affected by the WEP.

“I am developing a revised bill to provide meaningful WEP relief to current retirees and public employees while treating all workers fairly, which I will introduce this summer,” he said.

Neal has worked closely with TRTA in the past, as well as the former chairman of the Ways and Means Committee Representative Kevin Brady (R – Houston). You can read Neal’s full statement here.

TRTA has also been working with the Massachusetts Retirees, a group of retired public employees who seek to repeal the WEP.

TRTA and our coalition partners are working every day on WEP, and we believe some big announcements will be coming soon. Stay tuned to the Inside Line, as we will have opportunities to make a difference on this important issue.

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26 May
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Retirees’ Hard Work Has Paid Off! TRS Pension Fund to Be Actuarially Sound

Today, May 26, 2019 was the final day that the bills affecting Texas retired educators could be passed by the Texas Legislature. After months of emails, phone calls, personal visits and handwritten letters, retirees’ efforts have paid off!

Today, the Legislature passed Senate Bill 500 (the supplemental budget) and Senate Bill 12 (the Retired Teachers’ Security Act)!

The passage of both bills was absolutely necessary in order for retirees to receive a supplemental payment and for the Teacher Retirement System of Texas (TRS) pension fund to become actuarially sound. SB 500 provided the necessary funding for these measures, while SB 12 established the state policy that will now go into effect.

Earlier today, TRTA released an Inside Line that provided the details of how SB 12 will work to make the pension fund solvent.

The Texas Retired Teachers Association’s (TRTA) 94,000 members made all the difference in ensuring the future of the TRS pension fund. Before session began, the future of the pension system was uncertain due to recent changes to the assumed rate of return. The Legislature, various stakeholders, and the members of TRTA and the TRTA legislative team in Austin worked together to create a path for solvency that will impact all current and future TRS retirees for decades to come.

Thank you for being a strong advocate for retirees, present and future, and for following along with TRTA on this months-long journey! TRTA will never stop working for retired educators in Texas, and we hope you will always be by our side as we continue to fight for retirement security for all members of TRS.

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26 May
0

Call and Email Your Legislators Today! Last Chance to Pass Vital Legislation That Will Help Retirees!

Two must-pass bills are coming up for a vote, and will require your attention!

The Texas Retired Teachers Association (TRTA) has received information on how the deal to make the Teacher Retirement System of Texas (TRS) actuarially sound and provide retirees with a supplemental payment will be voted on as the session enters its final day for action. That final day is today: Sunday, May 26! TIME TO TAKE ACTION!

Two bills, SB 500 and SB 12, must pass for TRTA members to get the supplemental payment and for the TRS pension plan to become actuarially sound. SB 500 is the funding bill. SB 12 is the policy bill.

All eligible TRS members retired as of 12-31-2018 will receive an extra check capped at $2,000. The check is projected to be paid this fall. (Editor’s Note: An earlier version of the Inside Line mistakenly read 12-31-208. We apologize for the typo and any confusion this may have caused).

Because SB 500 allocates money out of the Rainy Day Fund, it must receive a total of 100 votes in favor in the House and 21 votes in favor in the Senate.

We need EVERY TRTA MEMBER TO GET ACTIVE ON THIS EMAIL ALERT! In addition, please call your state Senator and your state Representative offices today, Sunday, May 26, and ask them to vote “YES” on SB 500 and SB 12. Use our toll-free legislator hotline: 1.888.674.3788.

TRTA’s major issue has come down to the very last part of session. It all comes down to today, Sunday, May 26! Please, make sure you click the email link above and call your legislators and ask for their support as soon as possible!

All About the Legislature’s Plan to Fund the TRS Pension 

Actuarial Soundness—$524 million in additional TRS Pension Funding

The state of Texas has a plan to make the Teacher Retirement System (TRS) pension fund actuarially sound. The plan will increase the base funding from 6.8 percent to 7.5 percent. By fiscal year 2025, the state will have increased its base funding for TRS to 8.25 percent.

A few school districts will see an increase in their TRS contributions in the coming biennium. Ninety-six percent of school employees don’t participate in Social Security.

The few school districts that do participate in Social Security were exempt from paying an additional contribution to TRS when the Legislature required it in 2013.

SB 12 brings parity to ISD contributions, and then phases in additional employer funding over the next 6 years.

Active school employees will see no TRS pension fund contribution increases in the coming biennium. TRS employee contributions will see phased in increases as of fiscal year 2022.

According to TRS, this plan to raise the base will ensure the plan’s actuarial soundness.

Overview of TRS Plan (SB 12) Chart

TRTA’s Position

The Texas Retired Teachers Association (TRTA) supports the efforts being made by the Legislature to increase base funding to TRS. Our membership call this session has been to “raise the base!” The Legislature has done just that! We look forward to working with our friends in the active educator community to ensure the pension fund is solvent for decades to come, and we will protect this plan for every pre-retired TRS plan participant! TRS is a great value to the state and a tried-and-true pension plan for our retired and active school employees!

Supplemental Payment—$589 Million to Provide Financial Relief to Current Retirees

The Legislature is providing $589 million out of the Economic Stabilization Fund, also known as the Rainy Day Fund, to provide retirees with a “13th check.”

The check will be provided to those who were retired on or before 12-31-2018. It will be equal to a retiree’s monthly annuity with a cap of $2,000. The payment is projected to occur in the fall of 2019.

TRTA supports the supplemental payment. We know the TRS fund’s condition is improving with the state’s increased appropriations. We believe the pension fund’s overall actuarial condition will continue to improve over time, and that this supplemental payment is a welcome financial relief for hundreds of thousands of retirees who need some immediate financial help!

Concluding Comments

TRTA is working to ensure the long-term solvency for all TRS members. We have worked with the Legislature and with stakeholders on what matters most to our organization—the preservation of the defined benefit pension plan for ALL TRS retired and active participants.

SB 12 provides a plan to ensure the fund’s solvency, and it does so by reducing the funding period for TRS from 87 years to just 29 years. This may be the most aggressive and proactive work ever done with a state teacher pension system to ensure its long-term solvency.

TRTA members need financial help. The Legislature is investing $1.113 billion to help ensure the system is on a path to solvency and to provide a one-time supplemental payment to TRS retirees who retired on or before 12-31-2018.

TRTA estimates that about half of the current TRS retirees have never received a cost-of-living increase or a supplemental payment. With the passage of SB 12 and SB 500, that will change and hundreds of thousands of TRS retirees will receive a supplemental payment in the fall of 2019.

TRTA is proud to support the efforts made by both the Texas Senate and House to reach this compromise. Considering the work being done by the Legislature to focus on overall school funding and so many other issues, TRTA is pleased to see $1.113 billion in additional funding coming to the TRS pension fund, as well as directly into retirees’ pocketbooks.

It should also be pointed out that retirees are receiving an additional $231 million for TRS-Care to cover the projected shortfall in that program, meaning retirees should not have increased health care costs in the coming biennium.

This is a developing story. Please check back regularly for updates. TRTA anticipates a vote on SB 12 and SB 500 sometime late today, Sunday, May 26.

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