LEGISLATIVE BUDGET BOARD
                          Austin, Texas

                           FISCAL NOTE
                       74th Regular Session

                         January 27, 1995



 TO:     Honorable Senator Ken Armbrister,      IN RE:  Senate Bill No. 91
         Chair                                          By:  Leedom
         Committee on State Affairs
         Senate
         Austin, Texas






FROM: John Keel, Director

In response to your request for a Fiscal Note on Senate Bill No.
91 (Relating to disability retirement under the Employees
Retirement System of Texas.) this office has determined the
following:

The bill would alter the conditions under which a member of the
Employees Retirement System would be eligible for an occupational
death or disability benefit. Occupational disability benefits are
greater than non-occupational benefits. Under current law, such
eligibility is limited to an injury or disease that results from
a specific act or occurence that took place at a definite time
and place, resulting from an inherent risk or hazard peculiar to
state employment.  The bill would allow employees or their
survivors to receive occupational death or disability benefits if
the employee contracted a disease related to their duties, but is
not shown to be linked to a specific time or place.

In addition, former state employees now receiving non-
occupational disability benefits from ERS would be entitled to an
administrative hearing to determine whether they would be
eligible for an occupational disability benefit under the new
provisions of this bill.  The cost of these additional
administrative hearings, as well as the cost of occupational
death and disability benefits that would be incurred under this
bill would be paid by the Employees Retirement System trust fund.

The annual cost of the additional administrative hearings to the
ERS trust fund cannot be determined.    




An actuarial analysis indicates that the Employees Retirement 
System would incur an additional $22 million in actuarial
liabilities resulting from the modified occupational disability
and death benefit eligibility provisions.  Because the retirement
system would have no unfunded liability after enactment of this
bill, the period to amortize the unfunded liability would be zero
years.
 
The bill would increase the normal costs of ERS benefits.  The
current normal cost, calculated as the percent of total payroll
necessary to actuarial fund retirement benefits on an ongoing
basis,  is 12.22%.  The bill would increase the normal cost to
12.34%.   No increase in current state or employee contribution
rates would be necessary.




No fiscal implication to units of local government is
anticipated.




Source:   Employees Retirement System
          LBB Staff: JK, RN, DF