TO: | Honorable Robert Duncan, Chair, Senate Committee on State Affairs |
FROM: | John S. O'Brien, Director, Legislative Budget Board |
IN RE: | SB1298 by Wentworth (Relating to the service retirement annuity of certain members of the Judicial Retirement System of Texas Plan One and the Judicial Retirement System of Texas Plan Two.), As Introduced |
Fiscal Year | Probable Net Positive/(Negative) Impact to General Revenue Related Funds |
---|---|
2008 | ($600,000) |
2009 | ($620,000) |
2010 | ($650,000) |
2011 | ($680,000) |
2012 | ($690,000) |
Fiscal Year | Probable (Cost) from GENERAL REVENUE FUND 1 |
---|---|
2008 | ($600,000) |
2009 | ($620,000) |
2010 | ($650,000) |
2011 | ($680,000) |
2012 | ($690,000) |
The bill changes the formula relating to benefits payable by the Judicial Retirement System Plan-One (JRS-1) and Judicial Retirement System Plan-Two (JRS-2) by increasing the accrual rate for the extra years of contributing service from 2 percent to 3 percent for members reaching the Rule of 70 with 12 years on an appellate court. The bill also increases the maximum benefit from 80 percent to 90 percent of the state salary.
The bill takes effect September 1, 2007 and provides annuity payments made on or after September 1, 2007, regardless of a member's retirement date.
Based on the analysis by ERS, there are 43 active judges in the JRS-1 plan who would receive the increased benefits and out of the 486 retired judges, 128 would meet the criteria for having a recomputed benefit. Since JRS-1plan is not advanced funded, the fiscal impact of the increase is reflected in the tables above.
According to ERs, there are 498 active judges in the JRS-2 plan who would qualify for the increased benefits. For purposes of the determining the impact, it is assumed that the size of the active member workforce would continue to be 498 in the future. Based on the analysis by ERS, the JRS-2 plan would remain actuarially sound under the current contribution rate of 22.78 percent with no further increase in funding.
Source Agencies: | 327 Employees Retirement System
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LBB Staff: | JOB, KJG, MS, JW
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