TO: | Honorable Craig Eiland, Chair, House Committee on Pensions & Investments |
FROM: | John S. O'Brien, Deputy Director, Legislative Budget Board |
IN RE: | HB73 by Eiland (Relating to public financing of the public education employee retirement system and certain retirement benefits; making an appropriation.), Committee Report 1st House, Substituted |
Fiscal Year 2007
Teacher Retirement System |
Current |
Proposed |
Difference |
State Contribution Employee Contribution Total Contribution |
6.00 % 6.40 % 12.40 % |
7.19 % 6.40 % 13.59 % |
+1.19% 0.0% +1.19% |
Normal Cost (% of payroll) |
10.40 % |
10.40 % |
0.0% |
Amortization Period (years) |
Infinite* |
N/A** |
0.0 |
*The current contribution rate is insufficient to amortize the unfunded liability over a 30-year period. Currently, based on the
**Not available in the actuarial analysis.
ACTUARIAL EFFECTS: CSHB 73 would increase the required state contribution rate to the Teacher Retirement System (TRS) to an amount sufficient to amortize, within a 30-year period, the actuarial liability of TRS.
SYNOPSIS OF PROVISIONS
This bill, to be effective immediately if receiving required votes or if not,
· Appropriate an amount estimated to be $310 million to provide a one-time supplemental benefit to TRS retirees equal to the lesser of $2,000 and the participant's regular monthly annuity.
· Require the state to make an actuarially sound contribution to TRS, based on an actuarial valuation.
Source Agencies: | 338 Pension Review Board
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LBB Staff: | JOB, SR, CT, WM
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