LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 76th Regular Session May 12, 1999 TO: Honorable Florence Shapiro, Chair, Senate Committee on State Affairs FROM: John Keel, Director, Legislative Budget Board IN RE: HB2152 by King, Phil (Relating to a partial lump-sum distribution on retirement from the Texas County and District Retirement System.), As Engrossed ************************************************************************** * No fiscal implication to the State is anticipated. * ************************************************************************** Local Government Impact No significant fiscal implication to units of local government is anticipated. The bill would allow subdivisions of Texas County and District Retirement System to elect a partial lump sum option. This option would allow TCDRS retirees to elect a distribution at retirement of up to 100% of the total contributions and interest in a member's individual account in return for a actuarially reduced retirement annuity. Currently some members eligible for retirement withdraw their personal contributions instead of receiving an annuity, thereby losing the effect of the employer contributions. TCDRS subdivisions would lose this source of actuarial gains. Also, it is anticipated that some members would retire earlier. It is estimated that for those subdivisions that chose to adopt the partial lump sum option, the provisions of the bill would on average increase long term employer costs by a non significant amount, approximately 0.1% to 0.3% of payroll. Source Agencies: LBB Staff: JK, SD, PE, WM