The Texas Legislature meets in regular session in January of each odd-numbered year. View the list of summarized bills below that affect the programs administered by the ERS. 

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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)

SB1

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
  • JRS2 – 15.66% state contribution rate for both years of biennium
  • JRS1 – 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

Benefits Modifications

No retirement eligibility or calculation changes for current employees

  • 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 8/31/2014.
  • 3% COLA for those retired 20 years or more(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.

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.

Texa$aver

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.