LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 88TH LEGISLATIVE REGULAR SESSION March 21, 2023 TO: Honorable Giovanni Capriglione, Chair, House Committee on Pensions, Investments & Financial Services FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB1758 by Allen (Relating to the payment of certain employer contributions for employed retirees of the Teacher Retirement System of Texas.), As Introduced No significant fiscal implication to the State is anticipated. However, there would be an impact to the Teacher Retirement System which could impact the actuarial soundness of the fund. The bill would allow the Teacher Retirement System of Texas (TRS) to waive the required employer contributions that employers must pay when hiring a TRS retiree for one or more fiscal years.According to the Actuarial Impact Statement completed by the Pension Review Board, the Teacher Retirement System (TRS) is currently actuarially sound, with an amortization period of 27 years as of August 31, 2023. If TRS chose to waive the required employer contributions for hiring a TRS retiree, it is likely that the funding period would increase. However, the amount of the increase cannot be determined. An increase in the funding period would not increase the statutorily-required state contributions to the TRS Pension Trust Fund for the 2024-25 biennium; therefore, no significant fiscal impact to the General Revenue Fund is anticipated. However, the additional costs may result in the need for higher contribution rates from the State, employers, or members to the program. Local Government ImpactNo fiscal implication to units of local government is anticipated. Source Agencies: b > td > 323 Teacher Retirement System LBB Staff: b > td > JMc, MOc, ASA, MMo
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 88TH LEGISLATIVE REGULAR SESSION
March 21, 2023
TO: Honorable Giovanni Capriglione, Chair, House Committee on Pensions, Investments & Financial Services FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB1758 by Allen (Relating to the payment of certain employer contributions for employed retirees of the Teacher Retirement System of Texas.), As Introduced
TO: Honorable Giovanni Capriglione, Chair, House Committee on Pensions, Investments & Financial Services
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: HB1758 by Allen (Relating to the payment of certain employer contributions for employed retirees of the Teacher Retirement System of Texas.), As Introduced
Honorable Giovanni Capriglione, Chair, House Committee on Pensions, Investments & Financial Services
Honorable Giovanni Capriglione, Chair, House Committee on Pensions, Investments & Financial Services
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
HB1758 by Allen (Relating to the payment of certain employer contributions for employed retirees of the Teacher Retirement System of Texas.), As Introduced
HB1758 by Allen (Relating to the payment of certain employer contributions for employed retirees of the Teacher Retirement System of Texas.), As Introduced
No significant fiscal implication to the State is anticipated. However, there would be an impact to the Teacher Retirement System which could impact the actuarial soundness of the fund.
No significant fiscal implication to the State is anticipated. However, there would be an impact to the Teacher Retirement System which could impact the actuarial soundness of the fund.
The bill would allow the Teacher Retirement System of Texas (TRS) to waive the required employer contributions that employers must pay when hiring a TRS retiree for one or more fiscal years.According to the Actuarial Impact Statement completed by the Pension Review Board, the Teacher Retirement System (TRS) is currently actuarially sound, with an amortization period of 27 years as of August 31, 2023. If TRS chose to waive the required employer contributions for hiring a TRS retiree, it is likely that the funding period would increase. However, the amount of the increase cannot be determined. An increase in the funding period would not increase the statutorily-required state contributions to the TRS Pension Trust Fund for the 2024-25 biennium; therefore, no significant fiscal impact to the General Revenue Fund is anticipated. However, the additional costs may result in the need for higher contribution rates from the State, employers, or members to the program.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: b > td > 323 Teacher Retirement System
323 Teacher Retirement System
LBB Staff: b > td > JMc, MOc, ASA, MMo
JMc, MOc, ASA, MMo