LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
74th Regular Session
April 29, 1995
TO: Honorable Barry Telford, Chair IN RE: Committee Substitute
Committee on Pensions & Investments for
House of Representatives House Bill
Austin, Texas No. 411
FROM: John Keel, Director
In response to your request for a Fiscal Note on House Bill No.
411 (relating to eligibility for service retirement from the
Judicial Retirement System of Texas Plan One or the Judicial
Retirement System of Texas Plan Two) this office has determined
the following:
The bill would make no appropriation but could provide the legal
basis for an appropriation of funds to implement the provisions
of the bill.
The bill would lower the service requirements for retirement for
members of the Judicial Retirement System (JRS), Plans One and
Two. Current law allows retirement with unreduced benefits at age
65 with 10 years of service if currently holding judicial office,
and 12 years of service if no longer holding office. The bill
proposes to lower the service requirements to 8 years for all; if
age 65 or over this would be with unreduced benefits. Retirement
with unreduced benefits would be allowed at any age for 18 years
of service. Current law requires 20 years of service.
Additionally, retirement with unreduced benefits would be allowed
for anyone whose age plus years of service add up to at least 75.
The estimated state contribution for a 31-year amortization
period for JRS Plan Two would be 18.74%, an increase of 2.2% over
the current 16.54%. The cost of additional contributions for JRS
Plan Two increases from $0.5 million in Fiscal Year (FY) 1996 to
$0.6 million in FY 2000. Additional contributions would also be
required on a yearly basis for JRS Plan One, recognizing that
members will retire earlier due to the revised eligibility for
benefits. The cost of additional contributions for JRS Plan One
increases from $0.3 million in FY 1996 to $0.6 million in FY
2000. The combined fiscal implication for both plans is indicated
below.
The probable fiscal implication of implementing the provisions of
the bill during each of the first five years following passage
is estimated as follows:
Fiscal Probable Cost Out
Year of General
Revenue Fund 001
1996 $814,200
1997 924,484
1998 1,040,218
1999 1,056,425
2000 1,173,118
Similar annual fiscal implications would continue as long as the
provisions of the bill are in effect.
No fiscal implication to units of local government is
anticipated.
Source: Employees Retirement System
LBB Staff: JK, RN, WM, RR