Texas AFT on TRS at Texas Senate Hearing

(Yours truly had a productive exchange with Senators Bob Deuell, Republican of Greenville, and Eddie Lucio, Democrat of Brownsville.)

Texas AFT urged lawmakers to step up the state’s contributions to the TRS pension fund. . . . Melina Raab also urged the legislature to go beyond its current level of funding for the TRS-Care program of health coverage for retired school employees. He called for the use of the state’s so-called Rainy Day Fund, soon to be worth more than $9 billion, to help deal with the state’s current revenue problem.

Melina Raab told the Senate State Affairs Committee that Texas AFT supports a balanced approach to balancing the state budget, including new revenue. For example, he said, Texas AFT supports closing loopholes in the coverage of the sales tax, which currently exempts—for no good reason—a wide array of business and professional services. Eliminating those exemptions (except for lifeline services like health care and children’s day care) would raise $5.6 billion in fiscal years 2012-2013.

Texas AFT Testifies on TRS Issues at Capitol Hearing

Texas AFT reports TRS board meeting

Retired school employee health care: TRS-Care premium increase likely next year.

Active school employee health care: TRS staff likely to recommend elimination of the top-tier TRS-ActiveCare 3 plan next year.

And a bit of testimony from yours truly on keeping the pension fund strong, bolstering member confidence in its integrity and delivering a benefit to retirees.

News from the Texas Teacher Retirement System

Short-term savings for state could mean long-term costs for ERS: TANSTAAFL

The Austin American-Statesman's Kate Alexander reports on testimony by Ann Fuelberg, executive director of the Employees Retirement System of Texas, before the Texas Senate's Committee on State Affairs.

"Some 18,000 state employees — 13 percent of the workforce — are already eligible for retirement." Any policy that made retirement more attractive than staying on the job "could ripple through the pension fund." A sharp increase in retirees--with commensurate annuity costs--would occur at the same time as a likely drop in pension contributions--presumably because employees replacing the retirees would be earning lower salaries.

Read the full article

(TANSTAAFL? There Ain't No Such Thing As A Free Lunch)

Irving ISD considers TRS ActiveCare

Dallas Morning News reports that the Irving Independent School District is considering a number of measures to reduce its budget. The article also mentions that the district is considering joining ActiveCare, the health-care program for active school employees administered by the Teacher Retirement System of Texas health insurance program.

The context of the article seems to suggest that joining ActiveCare would be a cost-saving measure. Irving is a fairly large school district--some 4,300 FTE employees--so it would be surprising if a switch resulted in substantial reduction in the direct cost of health coverage. However, a move to TRS ActiveCare would probably make future health-care costs and benefits more predictable and would likely shift some administrative costs from the district to TRS.

Read the full article

P&I reports senior personnel change at TRS

Pensions & Investment, Wednesday, November 10:

'Texas Teachers fills chief risk officer post from within'
By Christine Williamson

'Jase Auby was promoted . . . to chief risk officer and manager of strategic research and risk management, replacing Kyle McDaniel.'

'Auby was senior investment officer, risk management at [TRS]'

Read the full article

Statesman's Alexander reports on TRS fund

In Wednesday's Austin American Statesman:

'No pension increase for retired teachers
Fund perks up, but aftershocks of market meltdown will be felt for years at TRS.'
By Kate Alexander

• 'strong investment performance during the past year . . . not enough to shake off the damage done by the financial meltdown of 2008.'
• 'one-year return of nearly 11 percent as of Aug. 31'
• 'retirees should not expect an increase in their monthly pension checks anytime soon'
• 'best hope for them might be a little help in terms of reduced health care premiums, said Ted Melina Raab of the Texas chapter of the American Federation of Teachers'

Read the full article