Tag Archives: TRS

Education: Where Texas Political Parties Stand

Dear TeachTheVote: Where does my party stand on public education?

It’s a great question to ask as we turn our focus to the November elections, and the answer can be found in each party’s political platform.

At the most basic level, party platforms are just a long list of beliefs and policy positions that delegates put together at each party’s state convention. This summer, Democrats met in Fort Worth and Republicans met in San Antonio to decide which issues to focus on. In each case, a handful of delegates cobbled together the platform, which was then submitted to the full convention for amendments and a formal vote for adoption.

Now before we get into the details of this year’s party platforms, there are a few important caveats. First of all, the platform committee responsible for writing the first draft is often composed of that particular party’s most ideological partisans. Sometimes the full delegation decides to water down the language and trim some of the fringe positions before voting to approve the platform, but that’s not always the case. Because of this, the end result can sometimes be a set of values that are not fully aligned to those of the party’s central majority and may be skewed toward the extreme edges of the ideological spectrum.

This ties into the next important point: Platforms have traditionally served as guideposts that indicate the party’s default position on a given issue, not marching orders for the legislative session. Each elected official is first responsible to their local district and the constituents who elected them, which is why platforms aren’t meant to be enforceable documents.

That being said, aggressively enforcing the party platform was the key theme for delegates voting on a party chairman at the 2018 Texas Republican Convention. This means that when the 86th Texas Legislature convenes, many legislators will be under great pressure from their party leaders to obey the platform committee’s positions over those of the voters they serve. That’s why it’s always important for educators to communicate directly with our elected representatives when it comes to public education issues.

Now that we’ve gotten all of that out of the way, let’s take a look at what this election season’s platforms have to say about education issues. For reference, you can find the full 2018 Republican Party of Texas Platform here and the 2018 Texas Democratic Party Platform here.

School Finance

The 2018 Republican Party of Texas Platform calls for ending “Robin Hood,” limiting increases in public education funding, and replacing school district property taxes with a consumption tax.

Each plank in the Republican platform is numbered. Plank 164 calls for “a simple, fair, and efficient method for financing our public school system” and opposes the Robin Hood system of recapture in which some money from property wealthy districts flows to property poor districts. The Republican platform explicitly opposes the Edgewood I and Edgewood II court opinions, in which the Texas Supreme Court ruled that the school finance system at the time was unconstitutional because it relied too heavily on local property taxes without any adjustment for rich and poor areas, which resulted in vastly unequal funding for children living in different communities.

When it comes to additional funding, the platform states, “Before receiving additional dollars through the school finance formulas, school districts must spend at least 65 percent of their current funding in the classroom.” According to the Texas Education Agency’s (TEA) 2016-2017 Pocket Edition statistics, districts spent an average of 56.7 percent of all funds directly on instruction and another 15.6 percent on support. Administration accounted for 3.1 percent of district spending.

Plank 166 states, “We call upon the Texas Legislature to use surplus revenue to buy down the school maintenance and operation property tax rate as a prelude to replacing it with a broader based consumption tax.” The most common consumption tax is the sales tax.

The 2018 Texas Democratic Party Platform calls for reducing the reliance on Robin Hood, funding schools in a way that reflects differences in costs between students and districts, and restoring funding that was cut in 2011 and 2017.

Individual planks are not numbered in the Democratic platform, but follow a narrative structure utilizing bullet points. The Democratic platform lays current funding deficiencies at the feet of Republican leadership, and declares restoring the $5.4 billion cut from public education funding in 2011 and $1.7 billion cut in 2017 “a legislative budget priority.” With regard to design, the platform advocates for “a 100% equitable school finance system with sufficient state revenue to provide every child the opportunity to learn in an exemplary program” and that “state funding formulas should fully reflect all student and district cost differences and the impact of inflation and state mandates.”

Private School Subsidies

The Republican platform states, “Texas families should be empowered to choose from public, private, charter, or homeschool options for their children’s education, using tax credits or exemptions without government restraints or intrusion.”

The Democratic platform states Democrats “oppose the misnamed ‘school choice’ schemes of using public tax money for the support of private and sectarian schools; believe ‘school choice’ is a deceptive marketing frame that purports to advocate something that already exists – school choice – but whose true purpose is to divert public school funds to vouchers or tax credit systems supporting private and sectarian schools; [and believe] that adoption of any vouchers or tax credit schemes would unavoidably financially and academically damage public schools.”

Teachers

The Republican platform calls for an end to payroll deduction and converting certain government pensions from defined benefit to defined contribution plans.

Plank 49 states, “Texas should prohibit governmental entities from collecting dues for labor unions through deductions from public employee paychecks.” Although the language mischaracterizes how payroll deduction works and refers specifically to unions, the 2017 legislative session showed that this plank is in fact aimed at non-union educators, including ATPE members, in an attempt to weaken teachers’ voices at the Capitol.

Plank 151 states, “The Texas Legislature shall enact new rules to begin to transition government pensions for ERS and TDCRS members from a defined benefit pension to a defined contribution retirement plan similar to a 403(b).” While the Teacher Retirement System (TRS) of Texas is not mentioned here, the language echoes similar attempts during the 2017 legislative session to deny educators a lifetime retirement benefit by converting TRS pensions to 401(k)-style defined contribution plans.

The Democratic platform opposes prohibitions on payroll deduction and supports “protecting the TRS defined benefit pension system against attempts to turn it into a risky 401-k plan that could put most retirees’ pensions at risk; providing a regular COLA for every retired teacher; repealing the federal government pension offset and windfall elimination provisions that unfairly reduce Social Security benefits for Texas educational employees; and improving the TRS-Care health insurance program for retired educators.”

The Democratic platform includes a plank specifically aimed at teacher recruitment and retention. It advocates that Texas bring teacher pay in line with the rest of the nation, increase the state contribution for teacher health care, restore financial incentives for those interested in pursuing the teaching profession, oppose test-based performance, and guarantee mentors and properly certified teachers in each classroom.

Classrooms

The Republican platform calls for the right to prayer in schools, local control of public education, objective teaching of scientific theories, opposing national core curriculum, teaching American identity, transitioning non-English speaking students to English, and adopting an official position against transgenderism.

Plank 123 addresses prayer in schools, and further states, “We urge the Legislature to end censorship of discussion of religion in our founding documents and encourage discussing those documents, including the Bible as their basis. Students and district personnel have the right to display religious items on school property.”

Regarding local control, Plank 131 states, “We believe that all children should have access to quality education. Under the US Constitution, the power to regulate education is reserved exclusively to the States and to the people. Parents have the primary right and responsibility to educate their children. The classroom should be a place where all viewpoints are welcomed, free speech is celebrated, and ‘person before politics’ beliefs are preached. We support the right of parents to freely choose public, charter, private, parochial, or homeschooling for their children. We support the right of parents to choose the specific public school that their children attend. No child should be forced to attend a failing school. We reject the imposition of federal education standards and the tying of any government funding to the adoption of federal education standards. We reject the intrusion of government in private, parochial, or homeschools. We affirm that the policies, procedures, activities, and finances of public education in Texas at all levels should be fully transparent. To ensure transparency, the check register of all traditional school districts and charter schools should be posted online with the link on the home page. We respect parental authority regarding sex education. We believe that abortion providers and affiliates should be prohibited from providing any curriculum or instruction in schools.”

Plank 135 lists basic standards such as reading and writing, and Plank 136 addresses scientific theories, “such as life origins and environmental change. These should be taught as challengeable scientific theories subject to change as new data is produced. Teachers and students should be able to discuss the strengths and weaknesses of these theories openly and without fear of retribution or discrimination of any kind.”

Plank 137 opposes national core curriculum such as Common Core and C-SCOPE, Plank 139 addresses American identity and assimilation, Plank 140 encourages non-English speaking students to transition to English within one year, and Plank 141 states, “The official position of the Texas schools with respect to transgenderism is that there are only two genders: male and female.”

The Democratic platform supports enforcing class size limits, replacing high-stakes tests with more appropriate diagnostic measurements, rejecting efforts to tie teacher performance to test scores, opposing “A through F” school ratings, promoting multi-language instruction, supporting Title IX protections for gender equity, supporting school meal programs, supporting school-community collaboration, and placing the most highly qualified teachers in areas facing the greatest challenges.

The Democratic platform includes a plank addressing early childhood education, which advocates for universal access to full-day pre-K and kindergarten, as well as classroom resources and quality measures to ensure children are performing at grade level by the third grade.

Democrats include a plank regarding the school-to-prison pipeline in their platform. This includes increasing the budget for school counseling, adding training for staff and law enforcement, and “repealing traditional, exclusionary approaches to discipline, such as expulsion and suspension, which disproportionately affect racial and ethnic minority students, as well as special education students.”

School Security

The Republican platform calls for arming teachers and mandating school security plans.

Plank 72 opposes the federal Gun-Free School Zones Act of 1990, and Plank 143 urges the legislature to “pass a statute that allows Texas school teachers, or other school employees, who are certified and insured to be authorized to carry a concealed gun on the premises of their assigned school for security and protection purposes.”

Regarding school security plans, Plank 144 states, “The Legislature is urged to adopt as a legislative priority to mandate by state law that all publicly funded school districts be required to submit a viable school security plan as part of an accountability program. The school security plan must explicitly provide for the personal security of students and staff by responding with an equal and opposite force to an aggressor that uses deadly weapons or devices. In an effort to customize plans for each district, a parent oversight commission will be consulted and advised as to the threat assessment status of schools at all times and must be allowed to partake in strategy sessions for the creation of the school security plan.”

The Democratic platform calls for “weapon-free and drug-free” campuses, the right of teachers to remove disruptive students, and efforts to prevent bullying and acts of violence.

Specifically, the Democratic school security plank states, “Implementation of systematic programs should be utilized to identify instances of bullying and implement school-wide positive behavior interventions and supports, to prevent violence, disruption, bullying, and harassment: Eliminate disparities in discipline based on race, ethnicity, national origin, disability, gender, sexual orientation, gender identity/expression or any other improper grounds.”

Furthermore, the Democratic platform calls for an end to “indiscriminate use of misdemeanor ticketing for minor infractions on campus and indiscriminate expulsion or placement of students in disciplinary alternative education programs for trivial misconduct,” and urges continued strong academic instruction for students placed in disciplinary alternative education programs.

The list of issues related to public education is lengthy and both platforms address many more such topics, including sex education and the role of the State Board of Education (SBOE). You can read more about the 2018 Republican Party of Texas Platform here and the 2018 Texas Democratic Party Platform here.

Teach the Vote’s Week in Review: August 3, 2018

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


The State Board for Educator Certification (SBEC) met today in Austin. As ATPE Lobbyist Kate Kuhlmann reported earlier this week, the board’s agenda included a controversial proposal to finalize rulemaking for an abbreviated educator preparation program for Trade and Industrial Workforce Training, Marketing, and Health Sciences certificates. Here is Kate’s recap of the board’s deliberations today:

The board adopted the proposal on a voice vote, but not without opposition from board members and stakeholders. ATPE was joined by teacher groups, administrator groups, and educator preparation programs offering opposition that together covered four primary areas of concern: (1) The proposal irresponsibly reduces the number of pre-service hours required of these specific educator candidates; (2) the proposal inappropriately adds the marketing and health science certificates; (3) the proposal allows entities other than approved educator preparation programs to provide some training; and (4) the proposal fails to prevent the certificate holders from seeking other certifications by merely passing an exam without required additional training.

Several board members also expressed concerns about the proposal. Members Suzanne McCall and Laurie Turner, who are teachers, and citizen member Tommy Coleman spoke to the importance of standards and consistency. They voted for an amendment to alter the proposal, but the amendment failed. Along with Texas Higher Education Coordinating Board (THECB) Assistant Commissioner Rex Peebles, who serves as a non-voting member of the board, Turner and Susan Hull stressed that success in an individual trade is not the same as knowing how to teach that trade to young students. This is why abbreviated pre-service and even overall training hours are concerning; the lowered standard fails to support these candidates and their students with adequate training. While other members of the board argued the proposal was innovative, Coleman countered that as much as he likes innovation, he doesn’t want to see innovation at the expense of standards. The board ultimately passed the proposal on a voice vote. It now advances to the State Board of Education for final review.

 


Following up on its June announcement that districts and charters affected by Hurricane Harvey would be eligible for accountability waivers, TEA announced earlier this week that 109 independent school districts and open enrollment charters would qualify for such waivers. School districts where all campuses are eligible for a Harvey Provision or where 10% or more of the district is eligible for a Harvey Provision that receive B,C, D, or  ratings will be listed as “Not Rated”  in the upcoming school ratings due out in August. The agency also announced that 1,188 campuses directly affected by Hurricane Harvey would qualify for a special evaluation in this year’s accountability ratings. A list of eligible campuses and districts can be found here.

 


Last week the Teacher Retirement System (TRS) reduced the expected rate of return on its pension fund from 8% to 7.25%.This change will make it more difficult for educators to obtain the cost of living increases they so desperately need.  The onus is now on the legislature, which will convene in January of next year, to provide increased funding in order to ensure that the pension remains healthy and can meet the requirement to be fully funded in 30 years as the law says it must. ATPE Lobbyist Monty Exter was on hand to provide testimony and comment to the media. Read more at the links below:

Full coverage of the TRS meeting

From the San Angelo Standard-Times: As changes loom over retired teachers’ pensions, retirees look to Legislature for more money 

From the Austin American-Statesman: Retired Texas teachers face giant hurdle to pension boost 

From KHOU11: Texas teachers urging for better pension system 

 


 

Earlier this week, Sen. Tim Kaine (D-VA) proposed legislation aimed at addressing teacher and principal shortages nationwide. The Preparing and Retaining Educators Act of 2018 aims to expand Teacher Quality Partnership Grants and require colleges and universities to report yearly on the number of licensed educators who graduate from their institutions, among other things. You can read the bill in its entirety here.

 

 


UPDATE: As we reported last week, President Trump signed the Perkins Career and Technical Education Act overhauling the primary laws that govern CTE. Read more about the bill in this post by ATPE Lobbyist Kate Kuhlman.

 


After competing in a special election triggered by the early resignation of Sen. Carlos Uresti, Republican Pete Flores and Democrat Pete Gallego will face off in a runoff election later this year. Read more about it in this post from the Texas Tribune.

Teach the Vote’s Week in Review: July 27, 2018

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


The Board of Directors for the Teacher Retirement System (TRS) met this week to discuss the pension fund’s assumed rate of return. Today the board voted to reduce the rate of return from 8% to 7.25%, anticipating a decline in investment revenue. It is now up to the legislature to provide additional funding for TRS in order to prevent a shortfall and stretch the already dwindling resources of educators even further. ATPE Lobbyist Monty Exter testified at the TRS board meeting and explains more about the decision in this post, which also includes a fact sheet provided by TRS staff.


 This week the Senate Select Committee on Violence in Schools and School Security met to discuss the last of the four charges assigned to them by the Lt. Governor. The panel heard invited and public testimony regarding best practices for preventing violence in schools and other topics. Not much longer after the hearing, Lt. Gov. Dan Patrick released a statement in which he said he would not support “red flag” laws, laws aimed at seizing the guns of those deemed a danger to themselves or others, citing failed legislation from last session as well as Gov. Abbott’s recent reticence to support red flag laws. The committee will now deliberate and release a report during the first week of August. More details about the hearing can be found in this post by ATPE Lobbyist Kate Kuhlmann.


Lt. Gov. Dan Patrick currently has no plans to debate his Democratic opponent, Mike Collier, despite repeated calls from the Collier campaign and many voters interested in the race for lieutenant governor. In a statement to the Texas Tribune, Allen Blakemore, a strategist for the Patrick campaign said the following:

“It’s no secret Lt. Governor Patrick relishes debates, but since his opponent shows no sign of grasping even the most basic rudiments of state government, our campaign has no plans to debate him,”

In response to this statement, the grassroots educators group Texans for Public Education offered to facilitate the debate by offering assistance “with location,  moderation, with time and date…” and other details. The full statement from the group can be read here.

Read more in this story from the Texas Tribune.


Earlier this week, both the U.S. House and Senate approved legislation aimed at revising the federal law that governs career and technical education (CTE). The Senate first passed a bill reauthorizing the Perkins Career and Technical Education Act. The House concurred with the Senate’s changes and the bill was sent to the President. At this time, President Trump has not yet signed the bill, but it is likely that he will. ATPE Lobbyist Kate Kuhlmann provides more information here.


TRS update: The vote is in

After taking testimony from many active and retired educators and those who advocate for them, including ATPE, the TRS board of directors deliberated today and ultimately adopted an assumed rate of return of 7.25%, down from 8% currently.

You can read more about this issue in previous Teach the Vote blog posts, including this post from yesterday. ATPE has also released this press statement following this morning’s vote.

TRS has provided this infographic to help interested parties better understand the reasons behind the move to a new rate and address some questions related to change.

One thing is certain: the ball is now firmly in the legislatur’es court to properly fund the TRS pension through increased compensation rates. Educators who are interested in the health of the fund should keep that in mind at the ballot box in November.

What’s happening at TRS this week?


This week, the TRS board of directors will discuss and likely take action on a recommendation to lower the assumed rate of return (RoR), based on investment forecasts provided by independent financial experts hired to assess all of the assumptions TRS staff uses for planning purposes. Should the board lower the assumed RoR it would be in line with broader trends in the public pension sector, including TRS’s peers. The vast majority of experts expect less robust investment returns in the near and mid-term future.

In order to maintain the long term health of the fund without decreasing pension benefits, contribution rates will need to be increased to offset an anticipated decrease in investment revenue. Unlike many local pension systems (e.g., municipal, police, and fire), the TRS board does not set contribution rates for either employees or employers; nor does the board set the benefits paid out to retirees. Both TRS contributions and benefits are completely determined by the Texas legislature. Should the legislature fail to pass a plan to provide adequate contributions over time, the only remaining options would be to reduce benefits, further weakening current and future retirees’ retirement security, or put the fund into a situation where benefits being paid out exceed revenues coming in, which would place the fund on a path to eventual insolvency.

The bottom line is that the burden is on the Texas legislature to step up and provide the necessary funding to ensure actuarial soundness of the TRS pension fund and give educators peace of mind that they will not face cuts in their pensions or other dramatic pension plan changes. Historically, the legislature has not been proactive in this area and has not prioritized funding for retired educators’ needs, opting to delay action until the pension fund reaches a crisis level.

Some educator groups have urged their members to flood TRS board members with calls and emails this week. We believe their calls to action, while well-intentioned, are misdirected, as the TRS board has virtually no authority over contributions or benefits and, with regard to investments, has a fiduciary duty to act in what it believes to be the best interest of the fund based on the prudent advice of its financial experts. In other words, TRS has few options at this time, given the legislature’s disregard over the course of decades for the growing financial needs of the pension fund.

The only way to avoid a major TRS funding shortfall that will hurt the educators who depend on the fund is legislative action, not action from TRS. With that in mind, educators who care about the short- and long-term health of TRS should be focused on the legislature, not the TRS board members. Current legislators who have not prioritized TRS funding have caused the current problem. Is it reasonable to expect those same legislators to now fix it, or does it make more since go to the polls in November and elect legislators who will prioritize TRS funding as part of a general dedication toward public education?

Check back tomorrow for a follow-up report on what action the board takes on the assumed RoR.

Teach the Vote’s Week in Review: June 22, 2018

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


A full meeting of the Texas Pension Review Board (PRB) was held on Monday, and the body voted to adopt voluntary guidelines designed to work as best practices for how retirement plans are funded. While the Teacher Retirement System (TRS) meets many of the PRB’s voluntary standards, it fails to meet standards in two critical areas that can be crippling to TRS members. Read more about the guidelines in this post by ATPE Lobbyist Monty Exter.

 


Earlier this month the State Board of Education voted unanimously to adopt curriculum standards for  a high school elective course entitled “Ethnic Studies: Mexican American Studies”. This comes after months of back and forth between members of the board and stakeholders over content and curriculum standards for the course as well as what it should be named. In this commentary, SBOE Chair Donna Bahorich (R-Houston) reflects on how working together made this course a reality and how that gives her hope, both for the state of Texas and the nation.

 


School may be out, but the fight for Texas public schools is ongoing. ATPE Lobbyist Mark Wiggins breaks down the ways you can engage with the legislature and advocate for your profession during the summer in this blog post.

Texas Pension Review Board adopts principles of retirement plan design

A subcommittee of the Texas Pension Review Board (PRB) has been working over the last several months on a set of non-binding guidelines meant to impart what the board feels are best practices with respect to retirement plan design for use by the retirement plans that are required to report to the board.

Despite some concern expressed by smaller funds over how the board’s non-mandatory recommendation on vesting periods might be made into a legal mandate by the Texas Legislature, the full PRB unanimously adopted the proposed principles, which can be found here, at its most recent meeting.

The Texas Teachers Retirement System (TRS) pension fund is one of the many funds, and certainly the largest fund, required to report to the PRB. While the design of the TRS pension fund by and large already meets the voluntary standards enumerated in the PRB’s principles document, the two areas where it does not are notable. First, the principles document calls for “contributions to retirement plans [to] be consistent with the PRB Pension Funding Guidelines.” Those guidelines call for plans to be funded at a level that would allow the plans’ unfunded liability to be amortized over less than 30 years. Second, the PRB principles say that a plan’s “retirement benefits should be protected against the erosion of the benefit’s value due to inflation.” Essentially that means plans should include built in COLAs (Cost of Living Adjustments). In both instances, that the TRS pension plan does not comply with these best practices is a function of the Legislature choosing not to fund the plan adequately.

Perhaps the Legislature and the Governor should take a note from the PRB, a body the legislature created whose chairman the Governor appoints, and fund TRS adequately to comply with the PRB’s newly adopted principles.

 

 

Teach the Vote’s Week in Review: May 11, 2018

From Austin to the nation’s capital, here’s a look at how ATPE’s lobby team has been working hard for you this week:


Early voting starts Monday for Texas’s Republican and Democratic primary runoffs on May 22. This week ATPE continued to highlight races across the state where education has pushed to the forefront of political discourse heading into the runoffs. We encourage you to learn more about the races in your district by visiting the candidates section of TeachtheVote.org and by checking out our runoff spotlights for candidates in House Districts 4, 8, 54, 62, and 121.

Remember, if you voted in a party primary back in March, you may only vote in the same party’s runoff election this month. If you are registered but did not vote at all in March, you may choose to vote in either party’s runoff election. You can find more information on eligibility to participate in the runoffs and what you need to do here.

Early voting for the runoffs is May 14-18, 2018, and runoff election day is May 22,2018.

 


ATPE’s lobby team has been working to prevent a controversial private school voucher amendment from being added to a national defense bill that is on the move. The U.S. House Committee on Armed Services met this week to consider the National Defense Authorization Act. Our Austin- and Washington-based lobbyists have watched the development of this bill closely since learning that discussions of adding a voucher were underway in the House. As ATPE Lobbyist Kate Kuhlmann reports today, the potential voucher, in the form of an Education Savings Account (ESA), would funnel existing federal Impact Aid dollars to military families without accountability for how those funds are spent. While the ESA didn’t make it into the bill during committee, it now heads to the floor of the House for debate. There, it could still be added through the amendment process.

ATPE sent a letter this week to Chairman Pete Sessions (R-TX), who leads the committee that determines which amendments will be considered on the House floor, asking him not to allow the voucher amendment. The letter highlights that we join the Military Coalition, a group of 25 organizations representing more than 5.5 million active and former members of the U.S. Military, in opposing the voucher. “The $2,500 voucher program created by HR 5199,” ATPE Governmental Relations Director Jennifer Mitchell Canaday wrote, “would drain limited dollars from both the public school system in Texas as well the Federal Impact Aid Program, hurting the very military-connected students it purports to help.” Read the full letter here and check back for developments on this issue.

 


An article by the Texas Tribune this week explored how charter schools operate in a precarious gray space that makes them a government entity at some times and a private entity at others. ATPE Lobbyist Monty Exter is quoted in the full-length article by Emma Platoff, which is republished here on Teach the Vote.

 


In an effort to encourage parents, teachers, and school leaders to actively participate in the rulemaking process, TEA sent a letter to school administrators on Wednesday requesting that school districts and open-enrollment charter schools post upcoming rulemaking actions on their websites. Learn more about the request and ATPE’s involvement in rulemaking changes in this blog post by ATPE Lobbyist Mark Wiggins.

 


 

House Pensions Committee meeting May 10, 2018, in Dallas.

The Teacher Retirement System (TRS) of Texas was one of the many items discussed at Thursday’s meeting of the House Committee on Pensions held in Dallas, TX. The meeting, which focused on the committee’s interim charges, featured testimony from TRS Executive Director Brian Guthrie plus a number of active and retired educators. ATPE Lobbyist Mark Wiggins attended the hearing and provided full details in his blog post here.

 


House committee discusses teacher pensions, health care

The House Committee on Pensions met Thursday morning in Dallas to discuss items listed under the committee’s interim charges, including the Teacher Retirement System (TRS) of Texas.

The committee met in the chambers of the Dallas City Council, which oversees pensions for the city’s police and firefighters that have come under scrutiny as of late. Dallas Mayor Mike Rawlings was the first witness to testify, thanking the committee for legislation dealing with issues pertaining to Dallas police and firefighter pensions and updating members on changes the city has put in place since the legislation’s passage.

House Pensions Committee meeting May 10, 2018 in Dallas.

Executive Director Brian Guthrie testified for TRS, laying out the basics of the $152 billion trust fund that serves 1.5 million active and retired members. The fund earned a return of 12.6 percent for fiscal year (FY) 2017, under an assumed rate of return of 8 percent. The fund carries $35.5 billion of unfunded liability and is 80.5 percent funded with an amortization period of 32.2 years, which Guthrie noted will change if the assumed rate of return is lowered. TRS manages two major healthcare programs: TRS-ActiveCare for active teachers and TRS-Care for retirees. Guthrie testified that TRS undertook a study in 2013 looking at the fund’s defined benefit structure, and will be producing an updated study this fall.

Turning to health care, Guthrie described TRS-Care as a “pay as you go plan.” The state’s contribution to the plan is 1.25 percent of active employee payroll, while school districts contribute .75 of active employee payroll and active employees contribute .65 percent of their paycheck. Retirees contribute to the plan through premiums. The plan faced a $1 billion projected budget shortfall heading into the last legislative session, and lawmakers of the 85th Texas Legislature put $700 million into the system in order to keep the fund from folding. While the infusion was able to prevent retirees from losing their health care, it wasn’t enough to avoid increases in costs and reductions in benefits.

Even with the changes, which included increasing premiums, the fund faces a $400-600 shortfall heading into the next biennium and ongoing shortfalls moving forward. Guthrie attributed the increase to legislation accompanying the added funding that directed the agency to ease cost increases. Guthrie indicated the primary problem is with the fundamental design of the funding formula, noting that healthcare costs are increasing far more quickly than revenue received from active employee payroll, which is the basis for the funding formula.

The largest cost increases are associated with plans that include coverage for dependents, and TRS initially offered retirees the option of permanently leaving TRS-Care for an insurance plan on the private market. Chairman Dan Flynn (R-Canton), members of the committee and legislators representing the Dallas/Fort Worth Metroplex pressed Guthrie to find a way to protect benefits, in particular prescription drug costs. Guthrie testified that the agency is studying all possible avenues, but the fund design presents the largest challenge.

Finally, Guthrie explained TRS-ActiveCare as a group insurance program for small to midsize school districts that would be otherwise unable to provide their own insurance programs. The state provides $75 per member, per month through the school finance formulas, districts contribute a minimum of $150 per month, and individual members are responsible for the remainder. Minimum state and district contribution levels have not changed since the plan’s inception in 2002, and employees’ share of the premiums has increased to 60 percent from 30 percent over the last 14 years. Because of rising healthcare costs, TRS board members voted at their most recent meeting to raise premiums for individual members between five and nine percent, or seven percent on average.

Because TRS-ActiveCare is funded through the school finance formulas, Guthrie suggested that any changes to TRS-ActiveCare would best be addressed as part of lawmakers’ broader efforts to reform the school finance system.

House Public Education Committee Chairman Dan Huberty (R-Houston) sharply questioned Guthrie over the board’s anticipated July vote to lower the fund’s assumed rate of return to 7.5 percent from 8.0 percent, despite returning 12.6 percent for FY 2017. This would cost an additional $1.2 billion on top of the $400-600 extra needed for TRS-Care, for a total ask of $1.6 billion on top of the $3 billion in base funding already designated for TRS. Guthrie testified that the agency’s fiduciary responsibility requires staff to provide an accurate estimate of what the fund is anticipated to produce.

A representative from Arlington ISD asked the board to consider allowing school districts with more than 1,000 employees to opt out of TRS-ActiveCare and provide their own insurance programs, pointing out that family healthcare costs under the TRS-ActiveCare high-deductible plan could account for more than a third of a first-year teacher’s annual salary. Chairman Huberty noted that such an arrangement could adversely impact TRS funding by reducing the broader pool of active TRS members.

Texas Retired Teachers Association (TRTA) Executive Director Tim Lee thanked the Texas Legislature for making the minimum changes necessary to keep TRS-Care from failing entirely. Lee suggested that 14 years may have been too long to go without increasing premiums, and pointed to the Employee Retirement System (ERS) as an appropriate benchmark for TRS. Going forward, Lee testified the only long-term solution is pre-funding the program, which would be even more costly than migrating TRS members to ERS. Lee indicated that retirees will be unable to countenance further cost increases, and noted that 36,400 people have decided to leave TRS-Care for the individual market.

Staff from the Pension Review Board (PRB) testified regarding the agency’s efforts to improve defined benefit programs. The board has ordered staff to develop an online dashboard of Texas public pension data, to study potential legislative recommendations regarding how systems whose funding is set by legislative statute can respond to changes in market systems, to study how systems of scale could be utilized to improve groups of smaller plans, and to conduct intensive actuarial reviews of systems with risk that threaten their long-term stability. PRB staff noted that ERS has already lowered its estimated rate of return to 7.5 percent from 8 percent, which TRS is currently contemplating.

The committee then opened the table to public testimony, and dozens of retired teachers voiced their concerns regarding healthcare and the defined benefit structure of the TRS pension program. Many shared heartbreaking stories of seeing fixed incomes virtually consumed by skyrocketing premiums even before paying the increased costs for services and medication. Retirees also expressed concerns regarding changes to the assumed rate of return.

 

Runoff Spotlight – Get to know the candidates in House District 4

When it comes to public education, the Texas Legislature has incredible power to decide how our students are educated, how our schools are funded, and how our educators are treated. From per-pupil funding to student testing to teacher pay and benefits, these issues and more will be at the forefront of the 2019 legislative session, making the 2018 election cycle extremely critical. Most of the legislators who will make up the ranks of the 86th legislature next January were decided on March 6 when Texas held its primary elections, and the bulk of the rest are looking toward competitive races in November. For the residents of a few key districts, however, the decision on who will represent them next session will be made on May 22, 2018, which is the date of the primary runoff election.

ATPE is taking a closer look at some of the runoffs that will be decided in May, where the candidates squaring off against each other have identified public education as a key campaign issue. Today, we’re analyzing the Republican primary runoff for House District (HD) 4. To learn more about the candidates vying for this seat, click on the candidate’s name and you will be taken to that candidate’s full profile on Teach the Vote.

The Candidates: Keith Bell (R) vs Stuart Spitzer (R)

HD 4 covers all of Kaufman and most of Henderson counties. The incumbent Rep. Lance Gooden (R) is running for a U.S. congressional seat, creating an open seat.

Candidate Keith Bell is a business owner and rancher who has served on the Forney ISD school board for 20 years. Responding to the ATPE Candidate Survey, Bell has said enhancing school funding is his biggest priority, should he get elected. He has been endorsed by the pro-public education groups Texas Parent PAC and Texans for Public Education.

Candidate Stuart Spitzer represented HD 4 during the 84th legislative session before losing his seat to Gooden. While he did not respond to this year’s ATPE Candidate Survey, Dr. Spitzer stated in response to the 2014 ATPE candidate survey that he believes TRS is a part of the “nanny” state and called 401(k) style investment of teacher retirement dollars a “liberty issue,” adopting language  commonly used by  those who support dismantling the TRS defined benefit pension system. Spitzer has been endorsed by the Texas Home School Coalition, a pro-voucher organization, and by Empower Texans/Texans For Fiscal Responsibility, which supports limiting state spending on public education; eliminating educators’ right to use dues deduction; private school vouchers; and privatizing the management of existing public schools.

For additional information on this race or the primary runoff elections in general, contact ATPE Government Relations at government@atpe.org.