Relating to a cost-of-living increase applicable to benefits paid by the Teacher Retirement System of Texas.
The implementation of HB1149 is expected to positively impact retirees by ensuring that their benefits keep pace with inflation, thus maintaining their purchasing power over time. The adjustments will be set annually during the last week of October for the following calendar year, providing clarity and predictability for both retirees and the Teacher Retirement System.
House Bill 1149 aims to introduce a cost-of-living increase applicable to benefits paid by the Teacher Retirement System of Texas. The bill amends Subchapter A, Chapter 824 of the Government Code by adding Section 824.009, which mandates annual adjustments to retirement benefits based on inflation. Specifically, the adjustment is determined by the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which is published by the Bureau of Labor Statistics.
However, the bill stipulates that benefits will only be increased if the Teacher Retirement System is deemed actuarially sound and funds are available. If insufficient funds are present to cover the full adjustment, the board of trustees is required to calculate the largest possible adjustment that can be made while ensuring the system's soundness. This provision might raise concerns regarding the adequacy of funding for such adjustments, potentially leading to limited increases in years of financial strain.