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TPEA has been working to inform state employees about relevant issues and concerns through our legislative update email program since 2003. TPEA takes pride in being the most reliable source of accurate and timely information on legislative developments and other concerns for active and retired state employees.
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Less Than Three Weeks Left in Legislative Session
Monday June 1 is Sine Die, the final day of the 140 day Regular Session of the 81st Texas Legislature. While the legislature has made significant progress on a number of major issues, much work remains to be done. A ten-member conference committee is busy negotiating the final version of SB 1, the General Appropriations Act. While progress has been made on state agency Sunset legislation for TXDOT, DPS and the Department of Insurance, none of these bills have been finally enacted. And, starting this week, procedural rules in the House and the Senate will begin to limit consideration of legislation. For instance, House Bills and Joint Resolutions had to be voted out of House committee by Monday, May 11, or they are effectively dead.
SB 1 Budget Conferees Named
The Senate and the House approved their respective versions of SB 1, the state budget bill, and now a ten-member conference committee comprised of five Senators and five House members has been appointed to negotiate the differences between the two versions of the bill. As specified in our last email update, there are major differences between the Senate and the House versions of SB 1 with regard to state employee pay and payment of a supplemental benefit for ERS retirees.
The members of the SB 1 conference committee in the Senate are:
Finance Committee Chair, Steve Ogden (R-Bryan)
Finance Vice-Chair, Juan “Chuy” Hinojosa (D-McAllen)
Senator Florence Shapiro (R-Plano)
Senator Royce West (D-Dallas)
Senator Tommy Williams (R-The Woodlands)
The members of the SB 1 conference committee in the House are:
Appropriations Committee Chair Jim Pitts (R-Waxahachie)
Appropriations Vice-Chair Richard Raymond (D-Laredo)
Representative Ruth Jones McClendon (D-San Antonio)
Representative John Otto (R-Dayton)
Representative John Zerwas (R-Richmond)
TPEA Goals on State Employee Pay and Retiree Issues
In our last email update TPEA provided a full explanation of the differences between the Senate and House versions of SB 1 with regard to how they address state employee pay issues and a possible 13th check or supplemental payment for ERS retirees. Based on these differences, TPEA has three priority goals that it is encouraging members of the SB 1 conference committee to work toward:
Employee Pay:
1) TPEA supports employee compensation enhancement in both years of the biennium for most state employees. TPEA is supporting the $1000 “bonus” granted to most state employees on September 1, 2009 under the House version of SB 1. TPEA is also requesting an ongoing 3 percent cost of living raise in FY 2011 for all state employees who don’t otherwise receive targeted pay raises.
2) TPEA also supports targeted pay raises for occupational groups with excessive turnover, where the State Auditors’ Office has identified the most significant pay disparities. In particular, TPEA supports a minimum of a 10 percent pay increase for TDCJ correctional and parole staff over the 2010-11 biennium.
3) TPEA has acknowledged the longer term actuarial problems facing the ERS retirement fund. In recognition of these problems TPEA has been working with other employee and retiree groups, as well as with key legislators, on legislation to comprehensively deal with the problems. TPEA believes legislators should authorize an appropriation for a supplemental payment or 13th check for ERS retirees as partial consideration for TPEA’s hard work in addressing ERS’ actuarial problems. At a minimum ERS annuitants should be granted the $1000 supplemental payment authorized in the House version of SB 1. A full 13th check for ERS retirees is deserved given that TRS retirees received one in January 2008.
ERS Retirement Issues To Be Considered in Senate
TPEA is pleased to announce that we believe a deal has been reached that will completely grandfather current employees for any legislative changes in retirement eligibility rules. However, all employees will be asked to contribute more to the retirement fund and the state will be required to contribute at least as much as employees. In order to begin restoring the ERS fund to actuarial soundness, it will also be necessary to enact significant retirement benefit changes for future employees.
In anticipation that the Legislature would attempt to address retirement policy issues, TPEA conducted a large scale poll of state employees earlier this year. The survey results can be seen here. TPEA used the survey results from nearly 13,000 respondents to help craft the package of changes that will now be considered in the Senate. TPEA will provide more specific information on this issue when the Senate Committee Substitute for HB 2559 is available.
For background on this issue, see the feature article from TPEA’s most recent magazine which explored the whole range of issues and possible solutions to ERS’ actuarial problems.
Senate and House Maintain Health Benefits, But Dependent Costs Rise
As TPEA has reported previously, both the Senate and House versions of SB 1 provide sufficient funding to maintain the state’s current health insurance premium contribution policy for active and retired employees and to prevent any increases in co-payments or other out-of-pocket expenses. There have been no indications that the SB 1 conferees are proposing to change this funding level.
However, because insurance premium costs are increasing, employees and retirees who have spousal or dependent coverage will experience increased costs to maintain their coverage. ERS health insurance premium costs are expected to increase by 6.8 percent in FY 2010 and 6.5 percent in FY 2011.
Based on current HealthSelect insurance premium costs, TPEA estimates (NOTE: these are unofficial estimates, the legislature and ERS Board of Trustees will approve actual rates) that FY 2010 rates for Member and Family coverage will increase by approximately $23 a month; rates for Member and Spouse will increase by approximately $14 a month; and, rates for Member and Children will increase by $10 a month. These are unofficial estimates for HealthSelect rates, rates for HMO participants will be determined in the ERS bidding process. Participants with dependent coverage will experience a similar increase in costs in FY 2011 based on the projected 6.5 percent premium increase.
Cheryl MacBride In ERS Board Run-off Election
The Employees Retirement System announced results from the Board of Trustee election today, May 12. As expected, there will be a run off between Cheryl MacBride and Yolanda Griego. Voting in the run off will begin on June 3 and will continue through July 7. Only a little more than 12 percent of eligible voters participated in the election and a majority of voters were retirees. TPEA will provide additional information on the run-off election as voting nears.
Watch TPEA’s website www.tpea.org for special event announcements and to read about TPEA’s future schedule.