TO: | Honorable Vicki Truitt, Chair, House Committee on Pensions & Investments |
FROM: | John S. O'Brien, Director, Legislative Budget Board |
IN RE: | HB468 by Phillips (Relating to supplemental payments of a retirement or death benefit by the Teacher Retirement System of Texas; making an appropriation.), As Introduced |
HB 468 provides supplemental benefit payments in January of 2008 and 2009 to certain Teacher Retirement System retirees and beneficiaries in an amount equal to the lesser of: (i) $1,600 or (ii) the regular annuity payment received in December 2007 or December 2008, as applicable. These payments do not permanently increase the retiree’s monthly payment. HB 468 proposes to appropriate the amount necessary to fund the supplemental payments, estimated to be $330 million in January 2008 and $350 million in January of 2009.
Since the appropriations will cover the costs of the supplemental payments, the proposed legislation will not cause an increase in the UAAL, funded ratio or funding period of TRS. Therefore, passage of this bill, as written, would not cause a violation of statutory funding requirements as long as the amount of each appropriation equals the amount of the payment.
The analysis relies on the participant data, financial information, benefit structure and actuarial assumptions and methods used in the August 31, 2006 valuation of TRS. The analysis assumes no further changes are made to TRS.
SOURCES:
Actuarial Analyses by Lewis Ward & W. Michael Carter, Gabriel, Roeder, Smith & Co. January 23, 2007.
Actuarial Review by Mr. Richard E. White, & Robert L. Schmidt, Actuaries, Milliman, February 14, 2007
Source Agencies: | 338 Pension Review Board
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LBB Staff: | JOB, WM
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