Lee will discuss the latest legislative happenings as it’s been a busy week at the Texas Capitol! Be sure to tune in!
Senate Finance Meets, Discusses Supplemental State Budget
The Texas State Senate Finance Committee met on Wednesday, March 8 to discuss Senate Bill 30, the supplemental budget bill. Included in the preliminary version of this bill are supplemental appropriations (beyond what is in Senate Bill 1) for the Teacher Retirement System of Texas (TRS).
Section 4.07 of the bill includes funds for a potential benefit enhancement for TRS retirees, which would be “contingent on the enactment of legislation by the 88th Legislature . . . and contingent on compliance with the requirements regarding the amortization period of the unfunded actuarial liabilities of the Teacher Retirement System under Section 821.006, Government Code” in the amount of “$1,000,000,000 is appropriated from the general revenue fund.”
Committee Chair Senator Joan Huffman (R – Houston) shared highlights from the bill, saying that $1 billion has been set aside for a benefit enhancement for TRS retirees, adding that “this is a starting point” and “a sign of good faith” that the Senate will work on this issue this legislative session. She also stated she is working on a bill “to craft exactly what that looks like,” adding that she is working with Representative Greg Bonnen (R – Friendswood) in the Texas House on writing this legislation.
Members of TRTA may recall that benefit enhancements could include a cost-of-living adjustment (COLA) or a supplemental payment (often referred to as a thirteenth check). While the legislation that would provide this enhancement has not yet been finalized, our members should know the bill filing deadline is Friday, March 10 and we expect to see bill language very soon.
TRTA Executive Director Tim Lee provided public testimony on the bill.
“We appreciate as an organization the work this body is doing to try and find ways to help retirees,” Lee said. “We know that that work is ongoing…We see this (bill) as another piece of the puzzle.”
TRTA believes that both the Senate and the House are taking TRS retirees’ concerns into serious consideration this session. As TRTA has remarked before during public testimony, the loss of buying power TRS retirees are experiencing is a very complex problem formed over many years of inflation and a lack of permanent increases in pension benefits. It may take several sessions to provide retirees with the financial help they need.
“Hopefully, we will have a very productive session helping retirees this year,” Lee said.
TRS Releases February 28 Actuarial Valuation
TRS released the results of its February 28 actuarial valuation of the pension fund today. This update finds the funding period as of February 28 to be 28 years. This is within the parameters of actuarial soundness established by the state, a threshold that determines if benefit enhancements can be passed for TRS retirees.
Per TRS, the Unfunded Actuarial Accrued Liability (UAAL) is projected to increase from $51.7 billion as of August 31, 2022, to $54.4 billion as of August 31, 2023 and the funded ratio of TRS is projected to decrease from 79.0% to 78.7%.
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.