LEGISLATIVE TALKING POINTS - September 10, 2015

When Dist. 20 met in Devine in early August of 2015, I mentioned TRTA would be sending some talking points in early Sept. covering several subjects.  Information sent from TRTA has always been helpful in allowing us to speak with a more unified voice.  I am sending this information to each president and legislative chair of each unit.  You may decide how best to disperse this information to your members. A verbal presentation of the major topics with some of the information under those topics being consolidated may be one way of making your members aware.  My experience has been a three page document handed out to the average member usually provides more food for the trash can then for the member.  You know your members and the best way for sharing information with your unit. 

  Many of you have Tim Lee speaking at your unit this coming week. I am pretty sure he will be sharing these talking points with your members.

 

Legislative Talking Points for District Fall Conventions
NOTE: These are the talking points that you should follow. 
Please be sure to cover these major points.

Windfall Elimination Provision
•    The Windfall Elimination Provision (WEP) has been a thorn in retired educators’ sides since being implemented in 1983. The WEP greatly reduces or even eliminates earned Social Security benefits for workers who also receive a public pension.
•    TRTA has developed a web page specifically dedicated to repealing the WEP. On the page, you can find the Congressional Representatives who have and have not co-sponsored HR 711, a bill that proposes to repeal the WEP.
•    The bill requires more co-sponsors to advance, and we need TRTA members’ help!
•    Please share the TRTA WEP webpage with your members and have them contact their Congressmen about supporting HR 711. Find the page on www.trta.org under the Legislation tab.

TRS-Care
•    During the 84th Legislative Session, TRS-Care was a major concern.
•    TRS-Care was projected to have a shortfall of nearly $1 billion by the 2016-17 biennium. Keep in mind that when TRS-Care was established in 1985, it was meant to be a temporary solution for health care for retired teachers, not meant to last more than 10 years. The program also uses a funding mechanism not tied to medical costs, but instead to active teacher payroll. This mechanism, coupled with rising medical and drug costs, led to an inevitable shortfall where more money was going out than coming in.
•    There was considerable concern this session that the shortfall could result in significant changes in premiums, benefits, or both. There was a very real possibility that retiree premiums could have doubled without additional funding from the Texas Legislature. Insurance is not a guaranteed benefit by the Texas Constitution.
•    Early in the session, House Appropriations Chairman John Otto announced that the Texas House would fully fund the shortfall, which totaled $768 million in additional funds.
•    The Senate also followed suit later in the session, and as part of House Bill 2—the supplemental appropriations bill—the funding was approved. This funding was announced by Chairmen of the Senate Finance Committee Jane Nelson.
•    The $768 million means that retiree premiums will remain stable for the next biennium! This is great news for retirees living on fixed incomes. It was the intent of the Legislature not to have retiree premiums increase.
•    Now is a great time to thank our legislators for the work they have done to protect TRS-Care and retiree premiums. All members of TRTA are encouraged to thank their legislators this fall! Send a letter or an email or make a phone call and say thank you today.
•    HB 2 did not address the long-term solvency issues still facing TRS-Care. The program is projected to face yet another sizeable shortfall for the 2018-2019 biennium, potentially as high as $1.5 billion!
•    Senate Bill 1940 was passed this session to form a joint committee of Senators and Representatives to continue studying options during the interim to resolve the TRS-Care’s funding issues.
•    As you may know, the Teacher Retirement System (TRS) completed a study about TRS-Care to research ways to protect the plan for the future.
•    That study will be reviewed, and feedback from stakeholders will be considered as the committee considers ways to make TRS-Care solvent. TRTA members may be asked to participate by attending committee meetings, perhaps even to provide public comment. 
•    Please stay tuned to the Inside Line, Tim Lee’s email newsletter, for updates about the interim committee and meeting dates! If you are not signed up for the Inside Line already, it’s easy to do so from the TRTA website and it’s free! Just visit www.trta.org.
•    TRTA will work hard throughout the interim and into the next legislative session to improve TRS-Care’s funding sources and to protect retirees from extremely burdensome premium increases. 
•    Right now, it is vital that YOU share information with any retirees and pre-retirees you may know and tell them to get involved in this discussion and be part of the solution for TRS-Care.
•    Let’s start working together NOW months ahead of the 85th Legislative Session to resolve the TRS-Care funding crisis. If we all work together and know up front that it will take a combined, open, honest, and thoughtful look at this difficult situation, we will develop solutions necessary to help TRS retirees.

The Teacher Retirement System of Texas (TRS) pension fund
•    We have seen the stock market fluctuate over the past couple of weeks. Because the Teacher Retirement System (TRS) pension fund relies upon investment income for more than 60% of its total value, we may see the TRS funding ratio change a bit until the markets become more stable. This is the nature of the investment business, and is to be expected intermittently as markets ebb and flow.
•    When the Legislature adjourned earlier this year, the TRS pension fund was the healthiest it had ever been, with more than $130 billion being held in trust for all current and future public education retirees. This is the most amount of money that has ever been in the fund in the history of the fund’s existence!
•    The TRS pension trust fund is actuarially sound by any definition.
•    The TRS investment staff is doing an excellent job of growing the fund, which services over 300,000 retirees and nearly 1,000,000 pre-retirees.
•    As you know, the regular 83rd Legislative Session held in 2013 was very productive for members of TRTA and benefitted hundreds of thousands of TRS retirees.
•    Senate Bill 1458, also known as the “TRS Actuarial Soundness Bill,” was passed, making the TRS pension fund actuarially sound and protecting the benefit plan for retired and active public school employees. For example, the Legislature, which sets the contribution rates for the fund, were increased in 2013. Rates from the state, active personnel and the district increased as a result of SB 1458.
•    SB 1458 also provided a cost-of-living increase (also known as a COLA) of 3% to TRS retirees who retired on or before August 31, 2004, capped at $100 per month. This was the first permanent increase received by retirees since 2001.
•    It is vital that the funding sources for the TRS pension fund remain intact so that the retirement security of all current and future public education retirees in Texas is protected! There is nothing wrong with the present TRS defined benefit (db) plan, however, groups that advocate against db plans and promote defined contribution (dc) plans will continue to push their agenda in 2017.
•    During the 84th Legislative Session, several bills were filed to address benefit increases for those retirees who did not receive the raise in 2013, including bills for a supplemental payment, also known as a thirteenth check.
•    Unfortunately, none of these bills made it out of committee so that they could be voted on by the entire body of legislators.
•    However, a sound system means future increases for retirees are more likely due to the fund’s improving actuarial status. 
•    This is an issue that will be revisited in 2017 during the 85th Legislative Session, as the Texas Legislature maintains its commitment to properly funding the pension fund.
•    House Bill 2168 was passed this session. Though this bill does not provide a benefit increase, it changes the way your monthly annuity will be received.
•    Historically, you have received your benefits the month after they were earned. For example, you have always received your December paycheck in January.
•    HB 2168 will change this payment schedule so that you receive your annuity check in the same month it was earned, starting September 2015. This is great news for retirees living on a fixed budget, as your payments will come on time and will not be delayed by weekends or holidays.
•    For example, TRS retirees will receive their December 2015 annuity a full five days earlier than under the current payment methodology. With December 31, 2015 falling on a Thursday, retirees would have not received their December annuity payment until Monday, January 4, 2016. Under HB 2168, the payment will be in your account by Wednesday, December 30, 2015.
•    Remember, the TRS board meetings can be viewed online. It is important for our members to watch the meetings when possible.