TO: | Honorable David Dewhurst , Lieutenant Governor, Senate Honorable Tom Craddick, Speaker of the House, House of Representatives |
FROM: | John Keel, Director, Legislative Budget Board |
IN RE: | SB1369 by Duncan (Relating to certain group benefits for retired school employees.), Conference Committee Report |
Estimated savings should be compared to funding levels sufficient to conform to current policies and law. Estimated savings should not be compared to agency "building block" funding requests.
Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
---|---|
2004 | $0 |
2005 | $0 |
2006 | $0 |
2007 | $0 |
2008 | $0 |
Fiscal Year | Probable Revenue Gain/(Loss) from OTHER FUNDS 997 |
---|---|
2004 | $155,210,629 |
2005 | $162,971,162 |
2006 | $171,119,720 |
2007 | $179,675,706 |
2008 | $188,659,491 |
The bill would amend the statutes governing the Teacher Retirement System's group insurance program for public education retired employees. The provisions in the bill that would have a direct fiscal impact relate to contributions to the retired school district employees' group insurance program.
Increasing the active public education employees' contribution to 0.50 percent from 0.25 percent would generate $106 million to the TRS-Care retiree insurance program over the 2004-2005 biennium.
Increasing the state's contribution rate to the TRS-Care program from 0.50 percent to 1.0 percent would cost the General Revenue fund $212 million over the 2004-2005 biennium. Under current law, the 0.50 state contribution rate results in a need for a solvency supplement of $1.1 billion. To the extent that the state contribution is increased, the solvency supplement is reduced. Therefore, the result of this provision is that the supplemental appropriation to TRS-Care would be reduced in the General Appropriations Act to show no net cost to the state.
The new revenue associated with these provisions is reflected as a gain to “Other Funds” in the fiscal impact table above.
The bill would also transfer $42 million from the TRS insurance fund for active school district employees to the TRS retiree insurance program. Because this would be an inter-fund transfer, it has no fiscal impact to the state.
Source Agencies: | 323 Teacher Retirement System
|
LBB Staff: | JK, EB, WP, JO, SD, UP, RN
|