Category Archives: Pensions

Teach the Vote’s Week in Review: Sept. 6, 2019

Here’s your weekly wrap-up of education news from ATPE Governmental Relations:


In the wake of the tragic shootings in El Paso and Odessa, Gov. Greg Abbott has issued executive orders addressing public safety. While most of the orders focus on improving agency-level responses like developing standardized intake questions and guidelines on when to submit Suspicious Activity Reports, executive orders number five and six deal directly with schools. The orders are as follows:

  • Order No. 5 The Department of Public Safety shall work with the Texas Education Agency and the Texas Higher Education Coordinating Board on ways to better inform schools, students, staff, and families about the importance of Suspicious Activity Reports and how to initiate that process.
  • Order No. 6 The Department of Public Safety shall work with local law enforcement, mental-health professionals, school districts, and others to create multidisciplinary threat assessment teams for each of its regions, and when appropriate shall coordinate with federal partners.

Learn more about the executive orders in this blog post by ATPE Lobbyist Andrea Chevalier.


Earlier this week U.S. Rep. Bill Flores (R-TX 17) announced that he would not be seeking re-election in 2020. This season has seen the announcement of a number of departures from Capitol Hill as well as many campaign launches. The special elections to fill the seats vacated by Rep. John Zerwas (R-Richmond), Rep. Jessica Farrar (D-Houston), and Rep. Eric Johnson (D-Dallas) have been set to coincide with voting on the constitutional amendments on Nov. 5th. The deadline to register to vote in the Nov. 5th election is Oct. 7. For more on the races in the upcoming election check out this blog post by ATPE Lobbyist Mark Wiggins. 


Curriculum and instruction is the subject of this week’s installment of ATPE’s blog series, “New School Year, New Laws.” This blog post examines bills such as House Bill 4310 by Rep. Harold Dutton (D-Houston) which stipulates that sufficient time be given for students to learn the scope and sequence of TEKS (Texas Essential Knowledge and Skills); and parts of House Bill 3 that provide funding for gifted and talented programs. For the full list of laws visit this blog post by ATPE Lobbyist Andrea Chevalier. 


The latest edition of the Texas Education Agency’s weekly video series, “HB 3 in 30,” covers special education and dyslexia. You can find a link to this week’s video and all previous videos here.


The Teacher Retirement System (TRS) has announced a time frame for retirees to receive their 13th ThinkstockPhotos-465016790_moneycheck. According to the TRS.Texas.gov website, retirees will receive their 13th check on or around Sept. 15, 2019. A list of frequently asked questions about the check can be found here. More of Teach the Vote’s coverage of Senate Bill 12 (the bill responsible for the 13th check) can be found in this blog post by ATPE Senior Lobbyist Monty Exter..


 

Teach the Vote’s Week in Review: Aug. 9, 2019

Here’s your weekly wrap-up of education news from ATPE Governmental Relations:


With back to school starting for millions of Texas students, it is time once again for students and teachers alike to buy school supplies. This weekend is the annual Texas Sales Tax Holiday, or “tax-free weekend,” as it is sometime called. This year’s tax holiday begins today, August 9, and runs through Sunday, August 11. During the holiday you can avoid paying sales tax when you buy most clothing, footwear, school supplies, and backpacks (sold for less than $100) from a Texas retail store or from an online or catalog seller doing business in Texas. ATPE members can also use their OfficeMax/Office Depot discount this weekend for even more combined savings.

Teach the Vote readers may have also heard about a grass roots movement started by teachers called #ClearTheList. Teachers participating in #ClearTheList or #ClearTheListsTexas post school supply wish lists on social media platforms like Facebook or Twitter, and companies or individuals will “clear their list” by purchasing the school supplies for the teacher to use in their classroom. Hopefully the day will come when we fund public schools such that these types of school supply charity drives will not be necessary, but until then – never underestimate the ingenuity or tenacity of a Texas educator to serve his or her students! To participate, type #ClearTheList or #ClearTheListsTexas into the search bar of any social media platform.

 


The Texas Education Agency is continuing to do its deep dives on the myriad new policies created with the passage of House Bill 3 with the release of another video in its “HB 3 in 30” series. This week’s video will dive into the outcomes bonus based on college, career, and military readiness, otherwise known as CCMR. A list of all previous HB 3 in 30 videos, as well as a schedule of upcoming topics, can be found at this link.

 


The movement to repeal the federal Windfall Elimination Provision (WEP), which decreases the Social Security benefits of many hard-working Texas teachers, gained media attention this week. This article by Lorie Konish of CNBC highlights recently introduced legislation by Texas Congressman Kevin Brady (R-The Woodlands) and quotes ATPE Senior Lobbyist Monty Exter. Look for more from the press and ATPE as additional bills are filed in Congress and the movement to address the WEP heats up in Washington this fall.

 


The 86th legislative session may have just ended, but that means a new election season is already upon us. Each day it seems that additional lawmakers are announcing their plans to retire as new candidates are announcing their bids to run, either to replace incumbents or for a chance to fill newly opened seats.

Without question, the 2019 legislative session was influenced in a positive way by huge voter turnout among educators and public education allies. If it weren’t for that turnout in 2018, there would likely have been no talk of an increase in teacher pay in 2019. It is critically important for educators to stay engaged this election cycle in order to maintain and improve upon the gains that were made last session, but it is also important for educators and all public servants to make sure they are expressing their political views and encouraging civic engagement among their peers in ways that are ethical and legal.

Thankfully, the Texas Educators Vote coalition, working in coordination with ATPE, has published this handy dos and don’ts guide on civic engagement around Texas elections. As educators head back to school, they can feel confident exercising their right to free speech with the aid of this guide. ATPE encourages members to check out the guide and other resources available from Texas Educators Vote on the coalition’s newly updated website, and be sure to follow Teach the Vote this fall for election updates and information to help educators stay politically active and make informed choices at the polls.

 


ATPE joined legislators and advocates from around the country this week for the National Conference of State Legislatures (NCSL) 2019 Summit in Nashville, Tennessee. This event draws together some of the brightest minds from the U.S. and abroad to discuss policy items of interest to state governments. Education is always a topic of lively discussion, and this year was no different.

Among the topics discussed were ongoing efforts to ensure all students are provided with an equally high quality of education, regardless of race or socioeconomic status. This continues to be a challenge in Texas and other states, where great disparities continue to exist both across and within school district boundaries. The U.S. Supreme Court ruled in Brown v. Board of Education in 1954 that laws passed to racially segregate schools were unconstitutional. Yet the Court’s decision in Milliken v. Bradley in 1974 essentially allowed segregation to continue as long as it is not explicitly intentional. The result has been de facto racial and socioeconomic segregation that continues in many parts of the state today, despite decades of efforts and lawsuits intended to achieve the original aim of integration.

Attendees also discussed efforts to improve the future of education, which includes working with employers to emphasize the role of the education system in creating the workforce of the future. How well we do at preparing future workers has a direct impact on the overall economy. Like Texas in 2018, many states have recently launched commissions to study ways to improve the public education system. The findings of these commissions are unsurprisingly similar to the results found by the Texas Commission on Public School Finance. For example, a commission launched by the state of Maryland found that investing in early education and better compensation for educators are both critical components of building a high-achieving education system. There is now a mounting body of evidence across the United States supporting these core determinations.


 

Teach the Vote’s Week in Review: June 28, 2019

Here’s your weekly wrap-up of education news from the ATPE Governmental Relations team:


On Tuesday, the Texas Education Agency (TEA) launched a new website that will serve as a resource portal for implementation of House Bill 3. In an introductory video, Commissioner of Education Mike Morath explained that TEA will release a series of videos covering different parts of the school finance reform bill. Read more about the new TEA resource in this blog post by ATPE Lobbyist Mark Wiggins. To learn more about House Bill 3 and other legislation that passed this year, check out the ATPE lobbyists’ in-depth analysis on Teach the Vote here and here.


In their first meeting since the 86th legislative session adjourned, members of the Pension Review Board (PRB) discussed the implementation of various pieces of pension-related legislation that passed this year. The discussion included a look at bills pertaining to the Teacher Retirement System (TRS) pension fund. There was also a passing of the torch as outgoing Chair Josh McGee ended his term and incoming Chair Stephanie Liebe began hers overseeing the PRB. Read a more detailed review of the PRB meeting in this blog post from ATPE Lobbyist Mark Wiggins.

 


Pension review board discusses recent legislation

The Texas Pension Review Board (PRB) met Thursday, June 27, 2019, in Austin with a focus on reviewing pension-related legislation passed by the 86th Texas Legislature.

Members began by recognizing outgoing Chair Josh McGee, who passes the gavel to new Chair Stephanie Leibe. The PRB governmental relations team then walked the board through a handful of items resulting from the most recent legislative session. The bills include:

  • Senate Bill (SB) 2224 by Sen. Joan Huffman (R-Houston) requires every public retirement system to adopt a written funding policy that details the system’s plan for achieving a funding ratio equal to or greater than 100 percent. Each plan must be submitted to the system’s sponsor and the PRB.
  • SB 322 by Sen. Huffman relates to the evaluation and reporting of investment practices and the performance of certain public retirement systems. Public retirement systems must now include in their annual financial report information about how much investment managers are being paid, as well as hire an independent firm to evaluate the system’s investment practices.
  • SB 12 by Sen. Huffman relates to contributions into and benefits under the Teacher
    Retirement System of Texas (TRS). This bill increases the annual base employer contribution, supplemental employer contribution, and member contribution rates over a five-year period. Certain retired members will also receive a 13th check this year capped at the lesser of the amount of their monthly TRS annuity check check or $2,000.
  • House Bill (HB) 2763 by Rep. Dan Flynn (R-Canton) relates to the police pension fund in certain municipalities.

The agenda book for the current PRB meeting included additional bills related to pensions, such as HB 3. While the school finance bill does not directly address TRS, PRB staff suggest that a significant increase in the salaries of some educators could affect the financial position of TRS over the short term. You can read the full agenda book for today’s meeting here.

PRB Executive Director Anumeha Kumar also explained the agency’s legislatively approved budget, as well as the revised rule review plan for the board. This plan will lay out the process by which the board will review rules for adoption, revision, or repeal.

Staff indicated that as a result of legislation passed this session, the TRS pension’s amortization period is projected to drop from 87 years to under 30 years. This would meet the minimum requirements for being considered actuarially sound and therefore eligible to provide members a cost of living adjustment (COLA). The plan’s amortization period jumped to 87 from 32 last year as a result of the TRS board’s decision to change actuarial assumptions to reflect more conservative economic forecasts.

TRS is by far the largest active plan under the purview of the PRB, with more than $154 billion in assets. The next largest plan, the Texas County & District Retirement System, is worth $30 billion. The PRB briefly mentioned a new resource that is available for members of the public to see a snapshot of the health of the state’s various public pension plans. The Texas Public Pension Data Center can be found here.

TRS bills move forward in both chambers

ATPE State President Byron Hildebrand testified in the House Pensions Committee, March 26, 2019.

The 86th Legislature has been considering bills to increase contributions to the Teacher Retirement System (TRS), which ATPE supports. Preserving the solvency and defined-benefit structure of the Teacher Retirement System (TRS) pension program for educators is an ATPE legislative priority this session.

On the Senate side, one high-profile measure on the move pertaining to this priority is Senate Bill (SB) 12 by Sen. Joan Huffman (R – Houston). After the bill received approval last week from the Senate Committee on State Affairs, which Sen. Huffman chairs, the full Senate passed SB 12 unanimously out of the upper chamber on Monday, March 25, sending it on its way to the House.

Meanwhile, a House committee today heard its own version of how to increase financial support for TRS, as well as for the state’s current retired educators. House Bill (HB) 9 by Greg Bonnen (R – Friendswood) was heard this morning by the House Committee on Pensions, Investments & Financial Services. The bill was left pending in committee today but is expected to receive a favorable committee vote in the near future.

Byron Hildebrand

ATPE State President Byron Hildebrand delivered our association’s testimony strongly supporting HB 9 in committee today. Hildebrand, who is also a retired educator, thanked legislators for taking a positive step forward with legislation aimed at making the TRS pension found sound, and he encouraged lawmakers to continue to take steps to do great things for active and retired teachers. Click here to watch today’s committee hearing, where HB 9 was the first bill considered. (Hildebrand’s testimony begins at approximately the 43-minute mark in the archived broadcast.)

While SB 12 and HB 9 both increase contributions to TRS and provide a 13th check to current retirees, the bills differ on the amount of the increased contribution, who would pay for it, and the size of the 13th payment. At 2.5%, the overall increase in TRS contributions under SB 12 would be a half percent more than the 2% increase called for by HB 9. However, HB 9 puts the responsibility for paying for the entire contribution increase on the state by raising the state’s rate from 6.8% up to to 8.8%. SB 12 only raises the state’s contribution rate from 6.8% to 8.25%, while also raising the active member rate from 7.7% to 8.25%, and raising the school district contribution rate from 1.5% up to 2%. HB 9 also begins and finishes raising the contribution rate a year sooner than SB 12 would. In terms of 13th payments, SB 12 offers all retirees a $500 bonus, while HB 9 would provide current retirees a 13th check in the same amount as their regular monthly annuity up to $2,400.

Stay tuned to Teach the Vote for updates on these two ATPE-supported bills as they continue to move through the legislative process.

12 Days of Voting: Retirement

Early voting is underway NOW for the November 6 elections, so we’re taking a look at some of the reasons why it’s so important that educators vote TODAY! In this post, we’re taking a closer look at retirement.


Everyone who decides to become an educator enters into a special agreement with the State of Texas. It goes something like this: If you devote your life to preparing our children for the future, Texas promises to be there for you when you retire at the end of a long career of service.

Only that promise is constantly under attack.

Let’s start with some basics. Your retirement is administered by the Teacher Retirement System of Texas (TRS), which oversees the pension trust fund. The state and individual educators each contribute to the fund, and a team of professional staff supervise a diverse investment portfolio that makes up the body of the fund. These full-time agency employees ensure the fund’s health and safety. After paying for the cost of administration and benefits, the money from those investments is plowed right back into the fund.

TRS is structured as a “defined benefit” retirement plan, which means that an individual who pays into the plan is guaranteed a set amount of money each month in retirement that will last for the rest of his or her life. The more common type of retirement plan is a “defined contribution” plan, such as a 401(k). Unlike the promise of a stable monthly pension check upon retirement offered by a defined benefit plan, a defined contribution plan promises merely a set contribution into an employee’s retirement account while the individual is actively working. Investment returns on that account are subject to the whims of the market. The level of retirement security that can be provided by those funds at the end of an educator’s career is not guaranteed. Under a defined contribution scenario, there is a real threat that a retired educator may outlive the retirement funds accumulated during his or her career, and end up with nowhere to turn for help — not even Social Security.

You may have noticed that most businesses in the private sector have gone the defined contribution route. The reason is largely because 401(k) plans are cheaper and don’t require dedicated staff to administer. Most are run for a profit by large Wall Street corporations, and advisers often have a financial stake in the investments they recommend. This leaves plenty of opportunities for others to make money, but little guarantee of stable retirement income for the retiree. The defined benefit plan administered by TRS is, by contrast, of great value to retirees, who can rest easier knowing that they will receive a guaranteed income for as long as they are alive.

As with most big pots of public money, the TRS pension fund has unfortunately become the focus of those looking to brag about shrinking government while making a few bucks for their friends.

In 2017, the Texas Senate confirmed Josh McGee as chairman of the Texas Pension Review Board (PRB), which oversees state pension systems including TRS. Prior to being appointed to that position by Gov. Greg Abbott, McGee worked as a professional advocate for converting public pensions to defined contribution plans that would reduce the money guaranteed to retirees, and his position at the helm of PRB naturally raised alarm bells.

Adding to the concern, lawmakers have filed a number of bills in 2017 and in prior legislative sessions that would likewise weaken TRS. State Sen. Paul Bettencourt (R-Houston) – who made headlines recently with his objections to efforts to improve voter turnout among educators – filed a pair of bills last year aimed at converting TRS from a defined benefit plan to a defined contribution plan or a hybrid of the two. Both bills died without a hearing, fortunately, but Lt. Gov. Dan Patrick is keeping the idea alive as part of his interim charges for the Texas Senate to study before the legislature reconvenes in 2019.

Most troubling is the decision by the TRS Board of Trustees to lower the assumed rate of return for the $147 billion pension fund from 8.0 percent down to 7.25 percent. The decision was based on observations of current market forces, and while fiscally prudent, it radically changes the plan’s outlook on paper. Like all pension plans, the TRS fund must be considered solvent before the legislature or board can consider any potential increases in benefits. With the lower assumed rate of return, TRS will head into the 2019 legislative session needing an additional $1.5 billion for future solvency, and they’ll be asking for that money from lawmakers who frequently are looking to cut spending, not increase it.

Politicians like Sen. Bettencourt frame their attacks on educators’ pensions by claiming the defined benefit structure is too expensive for the state to maintain into the future. In fact, the state’s share of an educator’s pension (at 6.8 percent) is less than half the teacher retirement contribution rate set by the next lowest state that is not paying into Social Security. The truth is that a more conservative assumed rate of return, coupled with a proper contribution rate, will guarantee TRS stays healthy well into the future.

The bottom line: Like public education as a whole, Texas gets a phenomenal bargain for what it spends, but more funding is necessary to fully realize the implicit promise made to educators.

Lawmakers will face tremendous pressure in 2019 from investors and politicians who want to gamble with teachers’ retirement. Unless Texans elect more pro-public education lawmakers and statewide elected officials, the legislature may very well look to your pension as an area to further cut corners. Texas will only keep its promise to educators if lawmakers respect educators’ voices at the polls in this pivotal election year.


Go to the CANDIDATES section of our Teach the Vote website to find out where officeholders and candidates in your area stand on this and other public education issues.

Remind your colleagues also about the importance of voting and making informed choices at the polls. While it is illegal to use school district resources (like your work e-mail) to communicate information that supports or opposes specific candidates or ballot measures, there is NO prohibition on sharing nonpartisan resources and general “get out of the vote” reminders about the election.

Early voting in the 2018 general election runs Monday, October 22, through Friday, November 2. Election Day is November 6, but there’s no reason to wait. Get out there and use your educator voice by casting your vote TODAY!