TRS HEALTHCARE AND OPEN CARRY BIG ISSUES IN SENATE ACCORDING TO KOLKHORST
Senator Lois Kolkhorst says the Texas Legislature is in full swing, and gives us an update on some of the items currently moving through the Senate.
One of the topics is Public Education and Community College issues, including pensions and healthcare, especially the Teacher Retirement System (TRS) which is running $700 million dollars short. She says she’s hearing from active school teachers that healthcare cost are a huge problem for teachers in Texas.
She says that the State of Texas taxpayer pays about $75 to the TRS healthcare fund, the local school district pays about $225, but the premiums have risen to about $700 a month, which, Kolkhorst says she hears from teachers that has become a huge burden to teachers and their families.
Also being discussed as presented are two Gun Right legislations, open carry and conceal carry on college campuses.
Also being discussed that she feels is a big issues are Transportation issues and the inefficiencies of those operations.
Kolkhorst says that while they are working in committees, the senate cannot hear a bill on either the senate or house floor for the first 60 days unless the governor calls an emergency session. She says she is looking forward to working with the next representative of District 13.
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For the past several years Texas legislators have at various times attacked, forsaken and abandoned educators in Texas. The state has not matched the contributions made by Texas teachers to the Teacher Retirement System of Texas. This has in part led to the deficit in the TRS Care insurance for retired teachers. The main reason for the big hit on the TRS was the early retirement of many teachers due to an issue several years ago.
There had been a loophole in the law that allowed retired teachers to receive full Social Security benefits, if their spouse were to pass away. The government closed the loophole, but not before many Texas teachers retired early so they could remain eligible to receive their full TRS benefit PLUS the Social Security benefits. This had not been anticipated by the TRS bean counters.
The early retirement led to a large number of teachers now begin to draw down on the TRS funds. Add to that, since they retired earlier than anticipated by TRS, they would be receiving benefits for a longer period of time. That would deplete the TRS over time. Compounding the problem, the early retirees no longer were paying IN to the TRS. That meant a decline in income for the TRS. So now TRS had an actuarial fault (bean counters that determine how much will paid in versus how much will be paid out so the fund will not go broke) meaning it was no longer based on good financial data. TRS was going now obligated to paying out more than it would take in.
Representative Kolkhorst and I discussed this at the time. It was obvious changes must be implemented. The legislature adopted new requirements for TRS eligibility. These included raising the aggregate number composed of years of service plus the teacher’s age from 80 to 85. This would mean teachers would have to work another two to three years before being eligible for full retirement benefits.
The state also raised the percentage of teacher pay that would be required to be paid in to TRS by about 1 1/2% over several years. According to state law, the teachers were paying the maximum allowed by state law. The state increased the amount of funding they provided. However, the state did not pay in the maximum allowed by state law, and the a
mount the state paid was less than the teachers paid in. In my opinion, the state made a token payment, instead having the teachers fund most of the changes to save TRS.
The state knew the TRS remained under-funded. They did nothing. Instead, they kicked the can down the road until a new governor and new legislature were in place. Now the TRS has chugged along without correction for another couple of years. Now the TRS is looking at a negative balance the coming year. Now the TRS is in dire straits.
I believe it is important for our citizens and educators to understand that there was a time when this could have been addressed, to prevent the TRS from being in this position. However there was a lack of motivation due to the desire to cut spending and fund commitments for political gain.
Do not let the politicians off the hook. They knew several years ago they had this problem. This problem was not created by the teachers. It was created by the state not maintaining the funding levels they had met before. It was created by laws passed by the government that allowed some teachers a financial incentive to retire early. That those teachers availed themselves of the opportunity caused the TRS to no longer be stable could have been avoided through diligence and vision on the part of those in the legislature or in taking the warnings from the TRS offices seriously when it was first brought to their attention.
The politicians put the TRS and retired teachers at risk. They have already raised the eligibility standards for generations of teachers now employed. They have raised the amount of money current teachers must pay in to the TRS. It is time for the state to raise their contribution to re-establish the actuarial stability of the TRS for the teachers now in the system and for all the retired teachers that are counting on the TRS for retirement income and low cost health insurance.
“It’s time for the state to raise their contribution” means tax payers will have to raise their contributions. If they slash here to pay there sounds good but to tax more doesn’t. The self employed do not have any one to contribute to their retirement plans nor does anyone pay part of their social security. So, I don’t think there will be much compassion from their camp, unless you are very wealthy self employed or an aggressive politician wanting the teachers in your camp on Election Day.
The article does not address self-employed plans, that is a separate issue.
To raise the state contribution does not necessarily mandate a tax increase. Understand the state’s maximum contribution would be an increase of less than 2%. The teachers and districts pay most of the cost of TRS. As explained earlier, other measures have been implemented that did not cost the taxpayer directly, but did impact teacher pay.
The current teachers have had the target dates for full retirement shifted another three years later, the current teachers are paying in a larger percentage of their salaries to the TRS (and they are taxpayers), local districts must now contribute more to the TRS as well. Last year the amount of raise many teachers received from the state was spent on meeting the increased rate of contribution to the TRS. This is the states way of shifting the funding from the state to the local taxpayer.
TRS funds health care for retired teachers, that are on fixed incomes. Teachers that draw TRS are not eligible for full Social Security benefits.
My purpose was to alert everyone to the fact that the urgency of this TRS Health care was apparent years ago. However, only when the TRS was one year away from being in a negative balance did the legislature make it a priority.
Bottom line is this. The TRS is underfunded. Most of this due to the one time hit the TRS took due to teachers leaving early, drawing retirement longer and fewer teachers paying in. Teachers and districts are paying more than before and are paying up to the maximum under current state law to fund the TRS. The state is NOT paying the maximum amount under current state law, and have not for over ten years. It is time the state stepped up to the plate to properly fund the TRS to allow for it to complete its mission, one of which is to provide sustainable. low cost health insurance for the retired teachers of Texas.
Texas Retirement System (TRS) Healthcare issues have always been a problem on the horizon for State Legislators.
“TRS-Care” is the healthcare insurance program for “retired” school employees while “TRS-Active Care” is the program for “active” school district employees. “TRS-Care” was established by the Texas Legislature in FY1986 with funding projected to last 10 years. It actually lasted 15 years with good management by the TRS. It was never intended to fund the program forever without periodic adjustment by the State Legislature. State appropriations, school district contributions, active employee contributions, and retired school employee payments have funded the program through 2015. The Active-Care fund is projected to be short by $746 million by 2016-2017. It should be noted that while State employees have 100% healthcare insurance paid by State appropriation, retired school employees are required to pay at least 30% of total program costs.
“TRS-Active Care” healthcare insurance for “active” school employees was established in FY2003 by the Texas Legislature. State funding of this program of $75 per month per insured employee has not increased since the inception of the program while school districts and especially school employees have shouldered the cost increases of this program.
Since the Texas Legislature took the responsibility to enact both programs for the benefit of both retired school employees and active school employees, it should take the responsibility for funding them properly.
If we are talking about quality of life and living for people, unfortunately Texas is near the bottom of most lists. One of the highest rankings, is high school drop outs. As far as cities, a few make it on to the list , and they are north of Dallas. Health care is a quality of life issue. Property taxes support our local schools to the greatest extent. But these taxes are not levied in an equitable fashion. That 50% break for 11 acres or more originates from the small family farms days when the majority of family income was agriculture. Maybe a better revenue solution would be proof that the 11 or more acres produced more than 75% of owner income. If not , pay full property taxes like the rest of us. You can bet on hearing some howls from some local and state deep pockets on that solution.
Texas government can’t be blamed for the quality of life and high school drop outs. There is a way to raise your children were they will honor their parents and respect others and work hard to achieve in this world, even if your not rich and wealthy. You don’t need the governments to provide for you.
Yes, teachers are getting the raw end of the deal in many ways in Texas! I carry my children on my insurance which is extremely high. Our company’s for medication are also very expensive. This past January, both of my children had the flu and bronchitis. Between paying for repeat doctor visits and all of the medication necessary, generic brands when available, I basically spent a good portion of my monthly paycheck! I spent $500 alone on Tamiflu in one week! Something has got to give!!!
If your talking about the schools health plans for the teachers yes. If my wife added her daughter and me(the husband) to her plan it would cost us almost 950.00 a month. We can get our on plan from an independent carrier for around 650.00 month. Not a very great benefit for teachers family!!
It is true that teachers with families have high premiums. The state pays $75.00 and the local pays $225.00. Is that per teacher family per month? Why are the people who pay property taxes on their homes paying the most and the state the least? We know that our legislators will not create a state income tax, it would offend too many wealthy contributors, especially from the oil and gas industry. And most of us homeowners do NOT get a 50% reduction in our property tax if we are not wealthy enough to own 11 acres or more and with a dozen cows. Maybe that group needs to take up the slack!
The state doesn’t pay any because what the state has is from tax payers. I guess if you are past the age of making an income you wouldn’t care if Texas had an income tax. But those of us that still have jobs no matter how large or small of an amount, don’t want any government entity taking any more of our money than they already do. As far as the oil and gas industry, if it wasn’t for them Texas would be down on the bottom of the list of best places to live in America.
When the Quarry Gas Plant was running the Burton and Brenham school districts benefited greatly. I don’t think you are aware of how much the oil and gas industry pays in taxes to county’s.