Highlights of the 79th Texas Legislature - Senate

EDUCATION/PUBLIC
Although the payment of current benefits is not in jeopardy, the system currently has an "infinite" funding period
according to the TRS outside consulting actuary. This refers to the necessary amortization period for assets to fund
liabilities. Benefit increases, even if only for current retirees, cannot be passed until such time that the fund can
amortize liabilities within a 31-year period. Under current conditions, it is estimated that an increase for retirees to
adjust for the cost of living is not expected within the next decade unless there are sufficient changes in contributions
to the system or to the structure of future liabilities, such as by discouraging early retirement. This bill:
Provides that an employee of an open-enrollment charter school operating under a charter granted by the State
Board of Education may participate in TRS.
Requires the commissioner of education and reporting entities to notify TRS of changes in the status of a school
district or charter school. The commissioner must notify TRS, not later than the 10th business day after the event:
• of the denial of renewal or surrender of a school's charter;
• that an open-enrollment charter school will not be receiving state funds; or
• that state funding of an open-enrollment charter school has resumed.
Prohibits school districts from offering employees incentives for early retirement.
Provides that TRS members who are not retired or eligible for certain insurance coverage are eligible for monthly
compensation supplementation:
• sets out how this amount is calculated and distributed, and
• authorizes employees receiving the supplemental compensation to use the distribution for any employee
benefit and to take an amount of the distribution as supplemental compensation.
Authorizes TRS to limit the purchase of service credit (a participant pays to TRS a specified amount and TRS then
grants the member one year of equivalent membership service credit for each year of credit approved).
Provides that a member may establish credit by depositing for each year of service credit the actuarial present value,
at the time of deposit, of the additional standard retirement annuity benefits that would be attributable to the purchase
of the service credit based on rates and tables adopted by the TRS actuary and adopted by its board of trustees.
Provides that a person who becomes a member of TRS on or after September 1, 2006, is eligible to retire and
receive retirement benefits if the member :
• is at least 65 years old and has at least five years of service credit in TRS; or
• is at least 60 years old, has at least five years of service credit in TRS, and the sum of the member's age
and amount of service credit in TRS equal the number 80.
Provides that certain persons who become members of TRS on or after September 1, 2006, are at least 55 years old,
and have at least five years of service credit in TRS, may be eligible to retire and receive a service retirement annuity
reduced from the standard service retirement annuity by a set percentage.
Provides that certain persons who become members of TRS on or after September 1, 2007, may be eligible to retire
and receive a service retirement annuity reduced from the standard service retirement annuity by a set percentage if
the:
HIGHLIGHTS - 79 TH TEXAS LEGISLATURE 81