Blog

Texans for a Secure Retirement watching 85th legislature for potential impacts

Texans for a Secure Retirement is tracking a dozen bills recently filed by state legislators that if enacted could impact public employee pension funds and beneficiaries.

The 12 measures are pension-related and hit upon several topics, including a bill to require municipalities to seek voter approval before taking on obligations to their public pension funds. Other proposed legislation would impact judicial, teacher, and armed forces beneficiaries. 
According to its website, the nonprofit Texans for Secure Retirement advocates for retirement security and raises awareness of the value of defined benefit plans. The TSR's board of directors discussed several of the bills during a Jan. 18 meeting in Austin. 

The organization is tracking two bills that would limit the legislature's ability to serve in a check-and-balance role for city councils that make changes to pension funds. The bills were filed Nov. 14.

House Bill 151 is authored by Rep. Ron Simmons, R-District 65, and would require municipalities to obtain voter approval before taking on obligations to their public employee pension funds. Senate Bill 152 is authored by Sen. Paul Bettencourt, R-District 7, and would require cities to adopt ordinances or resolutions regarding their pension funds, removing it from state lawmakers who currently approve these types of changes. 

Currently, to make changes, a municipality must have agreement among its city council, mayor or city manager, and pension fund board of trustees. The changes are then drafted into legislation and filed with the state legislature for consideration. If a proposed change is made without an across the board agreement among the parties, state House committees are reluctant to approve the change.

Texas legislative committees have rarely required its own changes to municipal pension funds. Bettencourt's bills would provide less overview of municipal employee pension funds.

Two bills, Senate Bill 68 filed by Sen. Judith Zaffirini, D-District 21, and House Bill 422 authored by Pat Fallon, D-District 106, are similar proposals that would prevent an elected official from receiving service retirement annuities if the official has committed a crime relating to their office. "Also, two bills, House Bill 398 and House Bill 397, would provide a 10 percent cost of living increase for Employee Retirement System beneficiaries and a 10 percent cost of living increase to Teachers Retirement System beneficiaries. Both bills were filed Nov. 14 by Rep. Alma Allen, D-District 131. 

If the proposals are approved during the 85th legislative session, they would be effective Sept. 1.

The table below is a list of the 12 bills the organization is following. Click on the bill numbers to read the bills in their entirety. Legislation may be tracked using Bill Lookup on Texas Legislature Online.
 
Bill Number Legislation
Author
Bill Filing Date Bill Details
HB 43 Rep. Dan Flynn (R-District 2) 11/14/2016 No new benefits can be established in the fund. The fund cannot increase monetary benefits if the additional liabilities would increase the amortization period beyond 30 years. Applies to municipal employees, police and firefighters pensions. A municipality's contribution rate will be the normal cost plus the level percentage salary payment required to amortize the unfunded liability no greater than 30 years.

Limits to DROP: Pension board may change payments to DROP benefits and limit the amount of earnings of members under the DROP or limit the length of time a member elects to participate in a DROP program.
HB 151 Rep. Ron Simmons (R-District 65) 11/14/2016 Voter approval for municipalities taking on obligations to the pension fund.
SB 152 Sen. Paul Bettencourt (R-District 7) 11/14/2016 Cities may adopt ordinances or resolutions regarding their pension funds. Only applies to employees hired after Dec. 31, 2017. State lawmakers would no longer need to approve these types of changes.
SB 68 Sen. Judith Zaffirini (D-District 21) 11/14/2016 An elected official cannot receive service retirement annuities if the official has committed a crime relating to the office held.
HB 422 Rep. Pat Fallon (D-District 106) 11/21/2016 The bill mirrors HB 68.
SB 45 Sen. Judith Zaffirini (D-District 21) 11/14/2016 Judicial retirement system of Texas Plan 2. A retiree who returns to service may not rejoin the retirement system unless the retiree has been away for 12 consecutive months or more.
HB 265 Rep. Ana Hernandez (D-District 143) 11/14/2016 Retirement System of Texas board must contain three appointees that are members of the retirement system. One may be a retiree. 
HB 248 Rep. Ana Hernandez (D-District 143) 11/14/2016 Teachers Retirement System cost of living increase.
HB 398 Rep. Alma Allen (D-District 131) 11/17/2016 Cost of living increase for Employee Retirement System beneficiaries; 10 percent increase to current benefit.
HB 397 Rep. Alma Allen (D-District 131) 11/17/2016 Cost of living increase for Teachers Retirement System beneficiaries; 10 percent increase to current benefit.
HB 440 Rep. Armondo Martinez (D-District 39) 11/22/2016 COLA increase for TRS. Board of trustees must find the system actuarily sound to make the adjustments.
HB 632 Rep. Pat Fallon (D-District 106) 12/16/2016 Limits amount of annuity for public employees to basic pay of member of armed forces or level II of the executive schedule as defined by 5 U.S.C. Section 5313

Texas Association of Public Employee Retirement Systems' executive director, Max Patterson, serves as president of Texans for a Secure Retirement. 

Comments

There have been no comments made on this article. Why not be the first and add your own comment using the form below.

Leave a comment

Commenting is restricted to members only. Please login now to submit a comment.