Tag Archives: Legislative Budget Board

Wrapping up the July TRS board meeting

The Teacher Retirement System (TRS) of Texas Board of Trustees met virtually last week on Wednesday through Friday, July 15-17, for its regular board meeting. In addition to other items, the board discussed the current financial market, TRS-Care and ActiveCare, the fiscal year 2021 budget and highlights of the preliminary legislative appropriations request, and updated considerations on TRS office space.

The official numbers for the trust fund through March 31 were presented to the board, but it was noted that those numbers are at this point significantly out of date. Staff went on to report that the market (as gauged by the S&P 500) has rebounded to approximately January 2020 levels, and they indicated that the TRS fund has tracked the market similarly. The benefit of the quick recovery of fund assets is that only a relatively small amount of assets had to be sold while prices were down to cover the cost of pension benefits paid out over that time frame. Longer recovery periods are by comparison much more detrimental to the fund because the period in which assets have to be sold at a reduced price, effectively locking in losses, is much longer.

TRS Board Presentation: S&P 500 chart

While the stock market and the TRS pension fund are relatively unscathed by the coronavirus pandemic for the moment, the state budget that relies largely on sales tax receipts and oil and gas severance taxes is in much worse shape. Due to this reality, state leaders called on all state agencies to cut their fiscal year 2021 budgets. Although the retirement system’s operational expenses are paid out of the pension fund itself and not out of the state’s general revenue, TRS still undertook the budget trimming exercise.

TRS staff presented the board with a proposed operational budget of $211 million for fiscal year (FY) 2021. This represents a 9% decrease from the FY21 target budget and a 6% decrease from the FY20 operational budget, which was $225 million. As part of the cost saving measures, TRS has instituted a hiring freeze through 2020 and a salary freeze through FY21. The agency has also cut the majority of outsourced funding going to vendors previously working on the data systems project dubbed TEAMS. The project will continue with the current number of in-house employees. TRS is also abandoning the effort to set completion dates on TEAMS benchmarks, as those dates have proven to be unrealistic and problematic.

In addition to next year’s budget, TRS staff also updated the board on the draft legislative appropriations request (LAR) the agency will present to lawmakers during the next legislative session. The agency’s request will cover fiscal years 2022 and 2023. The request will ask for specific funding to cover the state’s share of healthcare and pension costs, in addition to approval of the agency’s projected operational budget. TRS plans to ask for funding in the agency’s LAR based on the increased state contributions to pensions and retiree healthcare that legislators ordered during the last session and considering standard payroll growth assumptions for teacher salaries.

The agency’s LAR will also include a request for funding for 25 additional employees, or what are referred to as “Full-Time Equivalents” (FTEs). TRS staff had internally requested an additional 167 FTEs: 57 for the Investment Management Division (IMD) and 110 for the Benefits division. The 25 new FTEs in the agency’s LAR will go to IMD as a part of a “growing the fleet” initiative. This initiative aims to save the pension fund money by reducing outsourced costs in a greater amount than the cost of the new salaries. The Benefits division will have no new FTEs included in the upcoming LAR.

Over the last 18 months, space planning has become a constant conversation at the TRS board level as issues over the short term plans to lease space for housing the IMD staff have transitioned into a broader conversation on longer-term space needs for all staff. TRS continues to move forward with the goal of having a solution for its long-term office space needs in place by 2025. A major priority of that push is to house all TRS employees in the same location and discontinue the practice of housing the IMD staff in separate leased space.

As with everything, the current coronavirus has impacted the discussion around TRS space planning. With declining real estate prices and new potential spaces opening up in downtown Austin, the agency has paused its negotiations to renew its lease at 816 Congress so as to assess if there are better options available. Unfortunately, while the current market may present an opportunity for savings as a tenant, it is creating a more challenging environment in which to sublet the TRS space in Austin’s new Indeed Tower. The COVID-19 pandemic also has forced the agency to utilize remote working for a significant number of its staff for an extended time frame. Due to this change, TRS has revised its assumptions going forward on the percentage of staff who can work from home on a daily basis from 5% up to 25%. This change decreases TRS’s overall space requirements but also highlights a need for more collaborative space for staff who may usually work outside the office to come in and use. This also opens up the possibility that, with significant renovations, the agency’s current Red River location could house all TRS employees on a longer-term basis. Such renovations might not be any less expensive than simply relocating the agency to a new location outside of downtown Austin.

Finally, nominations for an active member seat on the TRS board of trustees are currently underway. The nomination period began June 15 and will continue through January 25, 2021. Assuming there are more than three successful nominees, an election will be held from March 15 to May 5, 2021. The top three vote-earners from that election will be reported to the governor, who will appoint the new board member from among those three candidates. ATPE members interested in running for this TRS board position can contact the ATPE Government Relations team for more information.

Access board documents and archived video of the July meeting here on the TRS website. The next TRS board meeting will be held in September.

Teach the Vote’s Week in Review: Jan. 11, 2019

Happy New Year! Here’s your first weekly wrap-up of education news from the ATPE Governmental Relations team:


Tuesday, January 8, kicked off the 86th Texas Legislative Session amid great fanfare at the State Capitol.

Representative Dennis Bonnen (R-Angleton) was unanimously elected and sworn in as the new Speaker of the House on Tuesday afternoon. For the past 10 years, the House has been under the leadership of Rep. Joe Straus (R-San Antonio) who retired from the position and the legislature at the end of his term this month. Bonnen announced in November 2018 that he had amassed the requisite number of pledged votes to render the speaker’s race not much of a race at all. After that there was only the vote and ceremonial swearing in, which took place on Tuesday. Read more about Bonnen’s ascent to speaker in this post shared from The Texas Tribune.

On the Senate side, Lt. Gov. Dan Patrick (R) was missing from Tuesday’s proceedings while visiting with President Donald Trump in Washington, DC, that day on the subject of border security. Sen. Jane Nelson (R-Flower Mound) presided over the upper chamber’s opening ceremonies in his place. The Senate swore in its new members and also elected Sen. Kirk Watson (D-Austin) to serve as President Pro Tempore this session.

Gov. Greg Abbott spoke briefly to welcome the members of each chamber, signaling his intent for the legislature to tackle school finance reform and property tax relief this session. Bonnen and Watson also highlighted the prominence of the school funding issue this session, with new House Speaker going as far as announcing that he had stocked the members’ lounge with special styrofoam cups to remind them of their top priority: school finance reform. Improving the state’s school finance system is also a top legislative priority for ATPE this year.

ATPE Lobbyists Mark Wiggins and Monty Exter snapped a selfie with Humble ATPE’s Gayle Sampley and her husband at the Capitol on opening day.

ATPE’s lobbyists were at the Capitol on opening day and will be there for all of the action this legislative session. Be sure to follow @TeachtheVote and our individual lobbyists on Twitter for the latest updates from the Capitol.

ATPE members are also encouraged to sign up for free to attend our upcoming lobby day and political involvement training event known as ATPE at the Capitol on Feb. 24-25, 2019. Find complete details here.

 


While the legislative session officially began on Tuesday, Texas Comptroller Glenn Hegar made news the day before with his release of the state’s Biennial Revenue Estimate (BRE). The BRE details how much money the state plans to receive and how much of it can be spent in any given legislative session.

Monday’s BRE announcement predicted revenue of $119.12 billion for the 2020-21 biennium. This biennium’s BRE comes with tempered expectations, which Hegar attributed to a drop in oil prices, market volatility, and rising interest rates. “Looking ahead to the 2020-21 biennium, we remain cautiously optimistic but recognize we are unlikely to see continued revenue growth at the unusually strong rates we have seen in recent months.” Hegar said in the report.

Once the comptroller has released the BRE for each legislature, the Legislative Budget Board (LBB) meets to set the session’s constitutionally-required spending limit. ATPE Senior Lobbyist Monty Exter reports that the LBB met today and set a limit of $100.2 billion for spending this session. The constitutional spending limit is set by applying the percentage of growth, which is determined by many factors, to the previous biennium’s spending limit. The constitutional limit applies only to expenditures of general revenue that is not constitutionally-dedicated. By comparison, the non-dedicated-revenue spending limit for the 85th session in 2017 was roughly $91 billion, whereas the total general revenue appropriated by the legislature that year was $106.6 Billion. As Exter explains, neither withdrawals from the Economic Stabilization Fund (the state’s so-called “Rainy Day Fund”) nor supplemental appropriations for the current biennium will count toward the constitutional limit that was announced today.

The Legislature must now decide what to do with its available revenue. Rest assured, they haven’t been given a blank check to do as they please. According to reporting by the Center For Public Policy Priorities the legislature must immediately spend $563 million as back pay for Medicaid funding that was deferred until this session. The legislature will also have to determine where $2.7 billion for Hurricane Harvey recovery costs will come from.

For more detailed reporting on the BRE as well as link to the full report, check out this blog post by ATPE Lobbyist Mark Wiggins.

 


Late last week, the House Committee on Public Education released its interim report covering the committee’s work over the past year on interim charges assigned to it by the House Speaker. The report, which spans 88 pages, includes recommendations on how to approach a variety of education-related issues this session, such as Hurricane Harvey relief, teacher compensation, and school safety.

Rep. Dan Huberty (R-Kingwood) chairs the committee that produced its interim report. Among the suggestions were recommendations to consider possible legislation to help schools quickly replace instructional materials due to Harvey; creating paths to career growth for educators that would allow them to stay in the classroom, such as a “Master Teacher” certification; and making Individual Graduation Committees (IGCs) permanently available for students who have difficulty with STAAR testing.

You can read more about the committee’s interim charge recommendations in this blog post by ATPE Lobbyist Mark Wiggins. Read the interim report here.

 


In a statement released to the press on Monday, Governor Greg Abbott announced his appointment of Edward Hill, Jr., Ed.D., John P. Kelly, Ph.D., Courtney Boswell MacDonald, and Jose M. Rodriguez to the State Board for Educator Certification (SBEC). The new appointees are replacing retiring SBEC members Suzanne McCall of Lubbock; Dr. Susan Hull of Grand Prairie; and Leon Leal of Grapevine.

ATPE thanks the members rolling off the SBEC board for their years of service and welcomes the new members. We look forward to working together with them to continue to improve the education profession for the betterment of Texas students.

 


Teach the Vote’s Week in Review: Sept. 14, 2018

It’s been a busy week in Austin. Here are highlights from the ATPE Governmental Relations team:


SBOE meeting Sept. 14, 2018.

Today culminates the end of a jam-packed week for the State Board of Education (SBOE), and ATPE’s lobby team was there throughout the week to testify and provide updates on the board’s activities for our Teach the Vote blog. Here are some highlights:

First, on Tuesday the body began its week by convening to discuss controversial social studies TEKS (Texas Essential Knowledge and Skills) that have been the subject of much political debate and social media attention. The board also took time on Tuesday to discuss its Long Range Plan for Public Education (LRP), which sets objectives for education through the year 2030. ATPE Lobbyist Mark Wiggins was on hand to commend the group on its thoughtful process, but also to suggest that the board take steps to increase the rigor of Educator Preparation Programs (EPPs) and insist that teacher pay not be too closely linked to evaluations and test scores. Perfecting amendments to the plan, most of which were in line with ATPE’s desired outcomes, were offered by SBOE Chairwoman Donna Bahorich.

The board kept its momentum going into Wednesday when it discussed special education and school funding. With an update from Commissioner of Education Mike Morath, the board learned that quite a bit of progress had been made on the state’s corrective action plan for special education with 70% of vacant positions filled. Morath also announced that TEA would be reviewing its contracting process, which comes after the Texas State Auditor’s office lobbed criticism at the agency for questionable contracting practices. Morath briefed the board on the A-F ratings that were given to school districts earlier this year. He also noted the decline in “IR” or “Improvement Required” districts across the state. Lastly, Morath informed the board of TEA’s Legislative Appropriations Request (LAR), which included two exceptional requests for funding for compensatory services for districts (in order to help them comply with the SpEd corrective action plan) and $50 million in funding for health and safety, $20 million of which is to be earmarked to comply with the governor’s school safety plan.

Later Wednesday afternoon, the SBOE also approved the funding distribution from the Permanent School Fund (PSF) for the 2020-21 biennium. Funds will be distributed at a rate of 2.75%. SBOE members expressed concerns regarding the deposit of funds into the Available School Fund (ASF) by the General Land Office (GLO), a move that will result in districts receiving $225 million less per year than normal. Several members of the board suggested actions in response to this action, including asking the GLO to reverse its actions and requesting that the GLO provide extra funding to cover the interest of the distribution.

On Thursday, the SBOE Committee on School Initiatives met to consider a rule proposed by the State Board for Educator Certification (SBEC) that would offer accelerated paths to certification for certain skill sets. The elected SBOE has statutory authority to review all rule actions taken by SBEC, a board whose members are appointed by the governor. SBOE members may veto SBEC rules but cannot make changes to them; SBEC rules for which the SBOE takes no action automatically become effective. For this week’s meeting, ATPE Lobbyist Mark Wiggins testified against the SBEC rule change regarding certain teaching certificates on the grounds that it exceeded the scope of the 2017 legislation upon which it was based, House Bill (HB) 3349. The rule change, as approved by SBEC earlier this summer, would have allowed certain educators to circumvent 300 hours of training in areas like pedagogy that are essential to normal pathways to certification. Members of the SBOE committee unanimously recommended rejecting the SBEC rule, and the certification rule change was ultimately rejected by a unanimous vote from the full SBOE board today, which will force SBEC to reconsider its action on implementing HB 3349.

Lastly, the full board met today to approve the first draft of language for the LRP, deciding to wait until November for final approval. SBOE members also finalized a formal letter to the GLO requesting that it cover the funding shortfall caused by its actions. Read more about the board’s actions in today’s blog post from ATPE Lobbyist Mark Wiggins.


As we have reported previously on Teach the Vote, ATPE has been an advocate for programs and resources to help prevent youth suicide. In 2015, we successfully advocated for the passage of an educator training bill aimed at preventing student suicides. Still, suicide, especially among Texans age 15-34, persists as a public health problem despite laws passed to prevent it. In this news feature by CBS Austin’s Melanie Torre this week featuring ATPE Lobbyist Monty Exter, Torre examines why the risk of teen suicide is still on the rise in Texas.

 


With the 2018 general election inching closer, and a major special election already underway his week in one San Antonio-area legislative district, ATPE wants to remind educators about the importance of voter turnout. Earlier this week, Texas Secretary of State Rolando Pablos released a statement urging voters to make sure they are registered to vote before the October 9th deadline. Pablos encourages Texans to plan their trips to the ballot box and to make sure they know what’s on their ballots.

“Prepare yourself, inform yourself, and empower yourself” – Rolando Pablos, Texas Secretary of State.

There’s a lot at stake this fall. We urge educators to view and share ATPE’s nonpartisan election resources here on Teach the Vote, including searchable profiles of every candidate vying for the Texas Legislature, State Board of Education, Governor, or Lieutenant Governor in 2018.

Meanwhile, early voting has already begun and continues through this evening in the special election runoff  to fill the vacant seat in Texas Senate District 19. Those SD 19 residents who miss early voting should play to get out and vote during their last change on Tuesday, Sept. 18th. The candidates in the runoff happening now are Democrat Pete Gallego and Republican Pete Flores. Find polling locations and additional information, courtesy of the Bexar County Elections Department, here.

Tuesday’s special election results and the outcomes of several high-profile races on the ballot in November could dramatically change the outlook for education bills moving through the Texas Legislature, and particularly, the Texas State Senate. In recent sessions, Lt. Gov. Dan Patrick has used the combination of a Republican super-majority in the Senate and his heavy-handed brand of managing the upper chamber to usher though a bevy of anti-public education bills, such as private school voucher proposals and legislation to take away educators’ rights to use payroll deduction for their voluntary association dues. How those same types of bills fare in 2019 will depend on the outcome of this fall’s elections. In this new post, ATPE Lobbyist Mark Wiggins breaks down the calculus of voting this fall.


ThinkstockPhotos-465016790_moneyThis week also proved to be insightful in terms of previewing discussions we’ll hear during the 2019 legislative session about both the state’s education budget and efforts to reform our school finance system.

Both the Texas Education Agency (TEA) and the Teacher Retirement System of Texas (TRS) laid out their Legislative Appropriations Requests (LARs) to the Legislative Budget Board this week. Details and links to video footage of TEA Commissioner Mike Morath and TRS Executive Director Brian Guthrie explaining their respective requests can be found here. ATPE Lobbyist Monty Exter provided additional analysis in this blog post.

Also this week, the Expenditures Subcommittee of the Texas Commission on Public School Finance convened to vote on their recommendations for the full commission. A breakdown of the committee’s goals, which include putting more funding into the basic allotment and shifting funds away from programs not directly tied to educational programming, can be found in this blog post by ATPE Lobbyist Monty Exter.