The Senate Finance Committee this afternoon voted to keep the state contribution rate to the Teacher Retirement System pension fund at 6.4 percent for fiscal year 2014 (beginning this September) while boosting it to 6.7 percent for fiscal year 2015. House budget writers on an education-spending subcommittee previously voted for a 6.6-percent state contribution rate for both years of the coming biennium. Texas AFT considers both proposals insufficient. The right move would be to approve the TRS budget request for a two-step increase in the state contribution rate, to 6.9 percent in fiscal 2014 and to 7.4 percent in fiscal 2015. The TRS pension fund is in good shape, but raising the state contribution rate substantially is the key to making a long-overdue cost-of-living increase for retirees feasible sooner rather than later. However, there was a fresh hint today that other changes in state laws on TRS pension contributions–and benefits—may be pursued instead. Sen. Robert Duncan (R-Lubbock), chair of the Senate State Affairs Committee with jurisdiction over TRS and a key player on the Finance Committee, said today’s decision on the contribution rate leaves the Senate with more work to do on TRS issues.
Duncan’s comment called to mind a February 21 TRS staff presentation to system trustees reporting that efforts to raise the eligibility age for full retirement benefits to 62 were “gaining traction” at the legislature. Attempts to impose higher contribution rates on active employees for both the TRS pension fund and the TRS-Care plan for retired school employees also cannot be ruled out. There has been talk as well of curtailing TRS-Care eligibility for retirees under 65, who are not yet eligible for Medicare.
Texas AFT has a better idea for lawmakers: Step up and meet the state’s neglected obligations instead of trying to shift still more costs onto active and retired school employees. You can expect to hear more from us soon on this topic.