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  • Outline of the state of Texas 
  • 83rd Texas Legislature

    The following is a list of some of the bills that passed and affect the programs administered by the ERS. For more information on legislation, please visit the Texas Legislature Online website.

    General Appropriation Bills (State Budget Bills)

     SB 1  

    Retirement:ERS – State contribution rates of 6.5%, plus up to 1% from FY 13 unexpended balances for FY 14; 7.5% for FY 15; plus an additional state agency contribution at the rate of 0.5% of base payroll for both years of biennium
    LECOSRF – 0.5% state contribution rate for both years of biennium
    JRS 2 – 15.66% state contribution rate for both years of biennium
    JRS 1 – Fully funded 

    Group Health Plan: ∙ Funded sufficiently to potentially avoid benefit changes through FY 2015
    ∙ Allows deposit of any FY 13 unexpended balance remaining after increasing ERS’ retirement contribution by 1%
    ∙ Maintains current 100% member and 50% dependent state contribution
    ∙ Maintains 1% of base payroll contribution from participating state agencies and higher education institutions
    ∙ Automatic charge of $30 monthly tobacco user fee for participants ≥ age 18, unless certified as not using tobacco during annual enrollment
    ∙ ERS is to study the effects of offering basic life and basic health plans


    Other Benefits:
    ∙ Public Safety Benefits (Chapter 615) – Fully funded
    ∙ Retiree Death Benefits – Fully funded 

     
    ERS Omnibus Bill

    SB 1459  

    Benefit Modifications
    No retirement eligibility or calculation changes for current employees
    Payroll Contribution Rates
    Funding period remains infinite
    • For employees hired after 8/31/2013
      • Minimum age 62 with Rule of 80 retirement eligibility.  If these members retire before age 62 (57 for LECOS), there is a 5% per year permanent retirement reduction factor
      • Eliminates use of unused annual leave to increase annuity if taken in a lump sum 
      • Final Average Salary based on highest 60 months 
       
    • Reduces interest paid on retirement account balances to 2% prospectively starting January 1, 2014 
    • Insurance contribution for retirees based on participation years – 100% after 20> years, 75% after 15> and 50% after 10>. Applies only to members with less than 5 years insurance participation on 9/1/2014.  
    • 3% COLA for those retired based on 20 years or more of service credit at the time the payment is paid (once fund is actuarially sound before and after payment)
     
    ERS State  Employer  Member  Total/Normal/ASC* 
    2014  6.5% 0.5% 6.6% 13.6/10.98/17.8%
    2015  7.5% 0.5% 6.9% 14.9/TBD/TBD
    LECOS State  Employer  Member  Total/Normal/ASC* 
    2014  0.5% 0% 0.5% 1.0/1.76/2.9%
    2015  0.5% 0% 0.5% 1.0/TBD/TBD

    Potential for 1% in FY14 from re-application of unexpended balances to ERS retirement trust.  

    *ASC is the Actuarially Sound Contribution rate that is required to pay the fund's liabilities within 31 years, per Texas law. 

     
    Chapter 615 - Survivor benefits for officers killed in the line of duty

    SB 396  

    Expands eligibility for Chapter 615 benefits to certain Department of Public Safety (DPS) employees who directly support a law enforcement function. Applies to deaths that occur on or after September 1, 2013. The Senate Committee Substitute identifies specific responsibilities/duties that would qualify for the Chapter 615 benefits.  
    Insurance - Eligibility

    SB 1536  

    Allows non-state employees who are in the Texas State Guard, and on active duty (military, emergency or training duties), to become temporary state employees. Those on active duty for more than 90 days may purchase health and dental insurance coverage under the GBP at full cost effective September 1, 2013. 

    HB 2127 

    Lessens GBP eligibility requirements for adjunct faculty members of higher education institutions participating in the GBP effective September 1, 2014. 

    HB 2155 

    Removes prior coverage requirements for incapacitated dependents over the age of 26 to be eligible for coverage under the GBP. 
    Insurance - Plan design/funding methodology

    HB 1869 

    Limits the subrogation related recovery amounts the GBP health plans and disability income plans may collect beginning September 1, 2014.  

    SB 1812 

    Changes the funding methodology for public junior colleges participating in the GBP beginning September 1, 2013 to 50% through ERS' insurance appropriation and 50% through the junior colleges' appropriations.  
    Insurance - Coverage

    HB 2929 

    Expands covered benefits for brain injuries under the GBP beginning September 1, 2014. 
    Investment

    SB 200  

    Prohibits ERS and TRS investments in companies identified by the Texas Comptroller as doing business with the government of Iran effective January 1, 2014. The bill includes divesting provisions for direct holdings that include an engagement process, is consistent with fiduciary responsibility, and allows for limited losses. SB 200, Pension Review Board sunset bill, was amended with HB 819's Iran divestment provision. 
    Texasaver

    SB 366  

    Senate & House Committee Substitutes require Texa$aver to allow conversion of balances from other qualified plans, such as a 401(k), into a Texa$aver Roth account effective immediately, if 2/3rds vote received. 
    Board of Trustees

    HB 1675 

    HB 1675 conference committee report requires the ERS Board of Trustees and ERS operations and programs to be reviewed, but not subject to abolition, by the Texas Sunset Advisory Commission beginning with the review period effective 2017 and every 12 years thereafter.  
    Miscellaneous

    HB 13 

    Expands financial and investment return reporting requirements for the Pension Review Board (PRB) and public pension plans, and requires the PRB to conduct a study of the financial health of public retirement systems. Also, requires the PRB to develop model ethical standards and conflict-of-interest policies and an educational training program with minimum training requirements for plan Trustees and administrators. 

    HB 1265  

    Requires the Board of Trustees to adopt rules by January 1, 2014 to ensure that state employees receive certain information about optional coverages available under the GBP including, life, accidental death and dismemberment, and long- and short-term disability. 

     

    Updated 6/4/2013.