21 Apr

TRS Board Elections Underway, Legislature Budget Conferees Named, and More!

While activity continues at the Texas Legislation to address the TRS-Care shortfall, this edition of the Inside Line will focus on some other key issues and actions that Texas Retired Teachers Association (TRTA) members should know about.

I. TRS Board of Trustees Elections: Be Sure to Vote!

Elections are now underway to fill two seats on the Board of Trustees for the Teacher Retirement System of Texas (TRS). The members elected to the Board of Trustees of TRS represent your interests! There are two open trustee positions: a Retiree seat and an At-Large seat.

As a retiree, you get to vote for one person for the retiree position and one person for the at-large position (active employees may only vote for the at-large seat).

PLEASE do not vote for more than one person per position on your ballot. Otherwise, it will be invalidated.

While TRTA will not tell you how to vote, we will tell you how vital it is that you vote! If you are you a retiree who wants your voice represented on the TRS Board of Trustees, your vote matters!

TRTA members, voting in this election is an easy way to send a message that you care about what happens with your pension. Many times, these elections do not have much voter participation. Can you imagine the “wow” factor if more than 100,000 retirees voted in this election? It would be amazing!

According to the TRS March Newsletter, “one position will be appointed by the Governor from a list of the three candidates who receive the most votes after nomination and election by TRS retirees who are receiving benefits. The other position, a new at-large seat on the board, will be appointed by the Governor from a list of the three candidates who receive the most votes after nomination and election by both TRS retirees and active members. The at-large seat on the board was formerly reserved for a candidate from higher education. Both appointments will be for terms expiring on August 31, 2023.”

The Candidates

To read more about all of the candidates, click here! TRTA is honored to have two members running for the retiree position on the TRS Board of Trustees. James D. Nance and Fran Plemmons are both dedicated association volunteers and leaders. Please take some time to read the short biographies listed on the TRS website for all candidates.

How to Cast Your Vote

All TRS members should have received a copy of the TRS March Newsletter in the mail. Within the newsletter is a paper ballot containing voting instructions. There should also be a postage-paid return envelope included with the ballot. Eligible annuitants and active employees will have the opportunity to vote via the Internet as well. Instructions for both voting methods are included with the ballots.

Both eligible retirees and active members may now cast their ballots in the at-large election. In addition, eligible retirees may cast their ballots in the retiree election. Retirees may vote for one candidate in both of these elections. (Please note that active members of TRS, also known as current employees, will receive a ballot containing only the names of the candidates seeking to be appointed to the at-large position on the board). Space on the ballots has also been provided for write-in candidates.

To be counted, ballots must be returned in envelopes received by TRS no later than May 5, 2017. Your ballot must be in the TRS office by May 5, not postmarked by that date. Be sure to send your ballot in the mail as soon as possible so that it is received in time!

If you prefer, you may cast your vote online following the instructions included with your ballot. Please note you may only use one voting method: mail or Internet. Internet votes must be cast by 5:00 p.m. (CDT) on May 5.

Names of the top three candidates, along with the number of votes they received in each election, will be submitted to the Governor. The Governor will then appoint one of the individuals in each election to fill a six-year term beginning as early as September 1, 2017.

Make your voice heard and cast your vote today!

II. Legislature Names Budget Conferees

As the 85th Legislative Session continues, progress on TRS-Care and the Texas budget is speeding up! As you may know, both the Senate and the House create their own versions of the state budget for the coming biennium. Those budgets often differ in how much funding is designated for programs and projects. As a result, a Conference Committee consisting of Senators and Representatives is appointed, and this group of legislators negotiates the details of the budget that ultimately gets passed by the end of the session.

The Senate and House named conferees to the committee this past week. Representing the Senate are Senators Jane Nelson (R-Flower Mound), Juan Chuy Hinojosa (D-McAllen), Joan Huffman (R-Houston), Lois Kolkhorst (R-Brenham), and Charles Schwertner (R-Georgetown). Representing the House are Representatives John Zerwas (R-Richmond), Oscar Longoria (D-Mission), Sarah Davis (R-West University Place), Trent Ashby (R-Lufkin), and Larry Gonzales (R-Round Rock).

These Senators and Representatives will be responsible for determining how TRS-Care is funded for the next two years. TRTA will keep you informed about upcoming meetings of the committee, and how you can help as the Legislature continues to refine its proposals for the retiree health insurance program.

III. Josh McGee Confirmed by Senate to Lead Pension Review Board

Governor Greg Abbott appointed Josh McGee, the Vice-President of the Laura and John Arnold Foundation, to be the Chairman of the Pension Review Board (PRB) in November 2015. When McGee was announced as Abbott’s choice to chair the PRB, TRTA expressed its opposition. The Texas Senate must confirm all Gubernatorial appointees, regardless of when they are appointed, during each legislative session in order to continue serving.

The Texas Senate Committee on Nominations reviews all nominations and recommends nominees to the full Senate. The committee, chaired by Senator Brian Birdwell (R-Granbury), met in March to review Mr. McGee’s nomination. During the meeting, McGee testified to the Senate Nominations Committee, and his confirmation was voted forward.

Senate confirmations require a two-thirds vote of Senators present at the time of the vote. This requires 21 votes when all 31 Senators are present, or 20 votes when only 30 Senators are present. Senate Democrats, who hold 11 seats, successfully have blocked McGee’s nomination since March.

However, yesterday (April 20) McGee’s nomination was confirmed 20-10 when one Senator was absent. The nomination was confirmed on a party line vote, with Republicans in the majority.

While McGee testified in March that he does not hold any preferences on pension plan design and “any type of plan can be designed well or designed poorly,” McGee has written many op-eds for the Manhattan Institute (a public policy think-tank). In his op-eds, McGee has shown a strong, consistent preference for defined contribution plans.

TRTA and our members must stay vigilant in protecting the TRS defined benefit plan. There is a well-funded national movement to replace all public employee defined benefit pension plans with defined contribution (401k-style) plans. Even this session, there has been an effort to replace the TRS defined benefit plan. The Laura and John Arnold Foundation is a national leader in this movement.

Since its creation, TRS has never once missed a payment to its annuitants, and we need to keep it that way! TRTA will continue to attend all meetings of the PRB and keep you informed about any concerns that arise.

Thank You

Thank you for your membership to TRTA. We are fighting ardently for your benefits every day at the Capitol. If you are not yet a TRTA member, please join here. Be sure to read our comprehensive Frequently Asked Questions about TRS-Care here.

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

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19 Apr

Texas House Appropriations Committee Discusses Funding Plan For TRS-Care

The Texas House Appropriations Committee met Monday, April 17 to discuss House Bill 3976, the TRS-Care bill filed by Chairman Trent Ashby. HB 3976 proposes to make significant plan design changes to TRS-Care, and increases state and school district funding to the retiree health care program.

The bill was voted out of committee yesterday. It will soon head to the Texas House floor for a vote. As progress is made on addressing the huge financial issues burdening TRS-Care, it is vital that our members read and share this information with fellow retirees and any active educators they know!

If Nothing Is Done

During Monday’s hearing, Texas Retired Teachers Association (TRTA) Executive Director Tim Lee testified, “TRS-Care is on a collision course for disaster if no action is taken this session.”

Currently, TRS-Care offers a no-cost option known as TRS-Care 1. Because the predicted shortfall is so high (more than $1 billion), TRS speculates that without legislative action the plan will have unaffordable premiums.

“If this plan (TRS-Care) does not have a solution, our retiree premiums will skyrocket,” said Lee.

The premiums are expected to exceed $1,200 to $1,500 per month, and many retirees would rush to the available free option, cutting program’s revenue drastically. This forced shift and loss of revenue would send TRS-Care into a death spiral, and the program would likely die in the coming biennium.

TRS-Care’s Central Problem: The Funding

The issues with TRS-Care emanate from the total funding made available for the program. Both versions of the budget started with no additional funding to mitigate the huge premium increase for retirees. TRTA has worked diligently with House and Senate leaders to secure additional funding. The results of that effort are evident, as the House proposal contains $633 million for TRS-Care.

The Texas House is proposing a much higher level of appropriation for TRS-Care than the Senate, providing supplemental funding for the program at twice the rate of the Senate.

Total Texas House increase in TRS-Care funding for FY 18/19 $633 million
Total Texas Senate increase in TRS-Care funding for FY 18/19 $311 million

The Legislation: HB 3976 vs. SB 788

At its core, HB 3976 is not that dissimilar from SB 788. However, when you compare the House appropriations to TRS-Care to the appropriations suggested by the Senate, there are significant differences in the real out-of-pocket-costs retirees will pay under the new healthcare plan design.

Pre-65 retirees: Retired educators who are not Medicare age-eligible (under the age of 65) would see their current plan options (TRS-Care 1, 2 and 3) transition to a single option, the “high deductible” (HD).

All figures stated are projections based on the ever-changing budget shortfall. The Texas House is proposing a $3,000 deductible for pre-65 retiree individual coverage. Comparatively, the Texas Senate proposed a $4,000 deductible. Both the House and the Senate propose a coinsurance coverage level for all. The deductible includes all medical and prescription drug costs. Once the deductible is reached, the plan will cover 80 percent of prescription drug costs. The plan has a $7,150 Maximum-Out-Of-Pocket (MOOP) cost for individuals. Once the MOOP is reached, all prescription drug costs will be covered.

The House bill adds an open enrollment provision for retirees when they become 65. This is an important provision as some pre-65 retirees enrolled in TRS-Care may leave the program and want to re-enroll when they become Medicare eligible.

Projected Pre-65 Retiree Premium Costs (Retiree only):

Year House Premium Plan Senate Premium Plan
2018 $200/month $250/month
2019 $250/month $310/month
2020 $310/month $370/month
2021 $370/month $430/month

Pre-65 Disability Retirees: The bill also provides a zero-cost premium for TRS-Care pre-65 members who retired with a disability annuity. Please note, the zero-cost option would only apply to the disabled retiree, not to the spouse and the provision will end in FY 2021.

Retirees age 65 and over: All retirees 65 and older will be transitioned to Medicare Advantage. The premiums would be approximately $146 per month.

Projected 65 and Over Retiree Premium Costs for Medicare Advantage (Retiree only):

Plan Year 2018-2021: $146/month

The Bottom Line

TRS-Care solutions are complex and costly. Retirees and state elected officials do not control the cost of healthcare. But, we all have to figure out how to pay for it.

While TRTA is working to keep TRS-Care as intact as possible, the state budget demands are vast and revenue in this budget cycle is extremely tight. Most items in state government are getting cut, and TRS-Care is one of the very few exceptions that may receive additional revenue.

The situation is dire, and whatever the Legislature decides, all solutions lead to TRS-Care participants paying more for health care coverage.

TRTA supports HB 3976. The bill is part of a broader budget plan that the Texas House has put forward to address the TRS-Care shortfall. It utilizes state revenue, as well as money from the Rainy Day Fund to lower retirees’ total out-of-pocket costs.

TRTA did not oppose SB 788. We were neutral on that bill as we hoped the Senate would continue to refine their plan and lower the out-of-pocket costs for retirees. For the time being, SB 788 has been removed from the Senate calendar and its fate is unknown. Eventually, the Senate will have to take action on a TRS-Care solution and take a stand on what they will support when it comes to your health care costs.

TRTA wants the best deal possible for retiree healthcare, and we do wield considerable influence in the Legislature. Your advocacy ensures our words carry weight with legislators.

We are working every day to help improve this situation. Ultimately, though, TRS-Care decisions will be made by the Texas Legislature. The best option on the table is HB 3976 and the House budget proposal because it proposes utilization of the Rainy Day Fund, also known as the Economic Stabilization Fund (ESF). It also proposes additional revenue from school district contributions.

The House plan represents a true “shared-pain” solution with the state taking on the biggest portion of total cost for the projected shortfall.

We need your help to keep this bill moving forward through the process. Without your support, the worst possible outcome may occur!

The TRTA Board of Directors is working with our state advocacy team and wants to find additional ways to help retirees. Chief among those areas of improvement are reduced prescription costs for pre-65 retirees. Additionally, TRTA is working directly with Chairman Ashby and other members of the Legislature on various strategies to ensure broad-based acceptance of the TRS-Care Medicare Advantage plan.

While the bill is alive and moving, we have opportunities to work with our friends in the Legislature to accomplish these goals. TRTA SUPPORTS these endeavors!

TRTA does not support doing nothing! As an organization representing more than 82,000 members, the idea of TRS-Care coming to an end is unthinkable. We cannot risk losing access to healthcare!

If you believe in doing something and working for the best possible outcome, please call your state Representative and thank them for helping to pass HB 3976. Thank them for using the Rainy Day Fund to help fund our TRS-Care needs, and ask them to use any and every opportunity to find additional ways to improve this plan for all TRS retirees!

Call your Representative using our toll-free Legislator Hotline at 1.888.674.3788!

Thank you for your help. Thank you for standing with TRTA as we do everything we can to help make this the best possible situation for our retirees. No matter what the outcome, TRTA always will work for you and do our best to protect your retirement security.

TRTA will have more details about HB 3976 as the session unfolds.

Thank You

Thank you for your membership to TRTA. We are fighting ardently for your benefits every day at the Capitol. If you are not yet a TRTA member, please join here. Be sure to read our comprehensive Frequently Asked Questions about TRS-Care here.

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

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13 Apr

Texas House Select Committee on State and Federal Power and Responsibility Discuss Resolution to Repeal GPO, WEP

Today, the Texas House Select Committee on State and Federal Power and Responsibility met to discuss several bills, including HCR 101, a resolution that would urge Congress to repeal the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP) of the Social Security Act.

Members of the Texas Retired Teachers Association (TRTA) know about these two unfair federal provisions, and that TRTA has been fighting for repeal or modification of them for more than three decades.

The resolution, filed by Representative Abel Herrero (D – Robstown), is one that has been filed during every Texas legislative session by Herrero over the past 12 years. If passed, it is sent to the President of the United States, the President of the Senate and the Speaker of the House of Representatives of the United States Congress, as well as to all the members of the Texas congressional delegation with the request that this resolution be officially entered in the congressional record.

Tim Lee meets with Rep. Abel Herrero.

TRTA Executive Director Tim Lee testified in favor of the resolution, reminding the members of the committee that these unfair provisions take away earned benefits, either spousal (GPO) or one’s own earnings (WEP). Texas educators are often caught off guard by these federal provisions, which financially punish educators during retirement. GPO often eliminates a spousal or survivor benefit completely, while the WEP eliminates up to two-thirds of a retiree’s Social Security earnings.

While TRTA is supportive of HCR 101, we also know that Congress has shown little movement to repeal the GPO and the WEP over the past three decades. TRTA supports the more other measures to repeal the current WEP formula proposed by Congressman Kevin Brady. As you may have read in a recent Inside Line update, Congressman Brady affirmed to TRTA that his top personal priority as a legislator is to pass WEP reform.

While Brady, who heads the Congressional House Ways and Means Committee, is focused on major policy issues such as tax reform and the Affordable Care Act (ACA) right now, we can expect to see a new bill addressing the WEP this congressional cycle. During the last congressional cycle, Brady filed H.R. 711, the Equal Treatment of Public Servants Act, which proposed to provide a rebate to retirees who fall under the WEP, as well as reforming the unfair formula for future retirees.

H.R. 711 received considerable support, including more than 100 Congressional cosponsors. However, stakeholder groups could not come to a final agreement on the bill’s changes to the WEP. The bill was delayed in committee, with a promise from Brady to continue moving forward with even better resolutions. When Brady re-files this legislation later this year, the bill will have a new number.

Congressman Brady also vowed to continue working closely with all stakeholders, including TRTA, to make the legislation work for everyone. The Government Pension Offset (GPO) may also be a part of this conversation. According to the congressman, it is possible that the GPO could be addressed in any upcoming legislation reforming the WEP as well.

What You Can Do Now to Support Repeal of the WEP and GPO

While there is not yet a bill number for reforming or repealing the WEP and GPO, members can still call their congressmen today and express their support for Congressman Brady’s efforts to change these unfair provisions. Let them know you want to see these unfair provisions reformed and you would like their support when Congressman Brady’s bill is filed later this year.

Find your U.S. Representative by clicking here.

Call your U.S. Senators, John Cornyn and Ted Cruz, using the phone numbers listed below:

John Cornyn: 202.224.2934        Ted Cruz: 202.224.5922

Thank You

Thank you for your membership to TRTA. We are fighting ardently for your benefits every day at the Capitol. If you are not yet a TRTA member, please join here. Be sure to read our comprehensive Frequently Asked Questions about TRS-Care here.

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

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