Honorable Giovanni Capriglione, Chair, House Committee on Pensions, Investments & Financial Services
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
HB3056 by Bonnen (Relating to the cash balance benefit under the Employees Retirement System of Texas.), As Introduced
COST ESTIMATE
The bill would make several technical and clarifying changes to state law by amending provisions pertaining to the cash balance benefit under the Employees Retirement System of Texas (ERS).
The bill would allow annual interest and gain sharing interest to be included in segregated payment amounts related to a Qualified Domestic Relations Order for the cash balance benefit group (Group 4) and allow Group 4 members to purchase military service credit. The bill would also provide five cash balance annuity benefit payment options in addition to the standard annuity payment option and add a partial lump-sum cash balance option.
According to ERS, the provisions and recommendations in the bill would have very little impact, to no impact, on the actuarial condition of ERS.
SOURCES Actuarial Analysis by Ryan Falls, FSA, EA, MAAA Gabriel Roeder Smith & Company, March 8, 2023.