LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION April 22, 2025 TO: Honorable Stan Lambert, Chair, House Committee on Pensions, Investments & Financial Services FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB3221 by Tepper (Relating to certain employer contributions to the Teacher Retirement System of Texas.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB3221, As Introduced: an impact of $0 through the biennium ending August 31, 2027. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.The fiscal implication of limitations on employer contributions for certain districts of innovation could not be determined due to lack of data. General Revenue-Related Funds, Five- Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact toGeneral Revenue Related Funds2026$02027$02028$02029$02030$0All Funds, Five-Year Impact: Fiscal Year Probable Revenue Gain/(Loss) fromTRS Trust Account Fund9602026($13,500,000)2027($13,500,000)2028($13,500,000)2029($13,500,000)2030($13,500,000) Fiscal AnalysisThe bill would limit employer contributions for charter schools and districts of innovation (DOIs) that opt out of the minimum salary schedule (MSS), so that the employer would only contribute 2.0 percent of payroll up to the MSS. Under current law, these employers also contribute 2.0 percent of payroll above the MSS.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION
April 22, 2025
TO: Honorable Stan Lambert, Chair, House Committee on Pensions, Investments & Financial Services FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB3221 by Tepper (Relating to certain employer contributions to the Teacher Retirement System of Texas.), As Introduced
TO: Honorable Stan Lambert, Chair, House Committee on Pensions, Investments & Financial Services
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: HB3221 by Tepper (Relating to certain employer contributions to the Teacher Retirement System of Texas.), As Introduced
Honorable Stan Lambert, Chair, House Committee on Pensions, Investments & Financial Services
Honorable Stan Lambert, Chair, House Committee on Pensions, Investments & Financial Services
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
HB3221 by Tepper (Relating to certain employer contributions to the Teacher Retirement System of Texas.), As Introduced
HB3221 by Tepper (Relating to certain employer contributions to the Teacher Retirement System of Texas.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB3221, As Introduced: an impact of $0 through the biennium ending August 31, 2027. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.The fiscal implication of limitations on employer contributions for certain districts of innovation could not be determined due to lack of data.
Estimated Two-year Net Impact to General Revenue Related Funds for HB3221, As Introduced: an impact of $0 through the biennium ending August 31, 2027. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.The fiscal implication of limitations on employer contributions for certain districts of innovation could not be determined due to lack of data.
The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.The fiscal implication of limitations on employer contributions for certain districts of innovation could not be determined due to lack of data.
The fiscal implication of limitations on employer contributions for certain districts of innovation could not be determined due to lack of data.
General Revenue-Related Funds, Five- Year Impact:
2026 $0
2027 $0
2028 $0
2029 $0
2030 $0
All Funds, Five-Year Impact:
2026 ($13,500,000)
2027 ($13,500,000)
2028 ($13,500,000)
2029 ($13,500,000)
2030 ($13,500,000)
Fiscal Analysis
The bill would limit employer contributions for charter schools and districts of innovation (DOIs) that opt out of the minimum salary schedule (MSS), so that the employer would only contribute 2.0 percent of payroll up to the MSS. Under current law, these employers also contribute 2.0 percent of payroll above the MSS.
Methodology
The Teacher Retirement System (TRS) estimates that the loss of funding that would occur from the change to charter school contributions would be $13.5 million annually. TRS did not have necessary data on applicable DOIs to calculate the loss of contributions resulting from employer contribution limitations for MSS-exempt DOIs, so the impact could not be determined.
Local Government Impact
The bill could result in savings for certain public schools that would see a reduction in employer benefit contributions.
Source Agencies: b > td > 323 Teacher Retirement System
323 Teacher Retirement System
LBB Staff: b > td > JMc, FV, ASA, ENA
JMc, FV, ASA, ENA