New state laws bolster state retirement fund, positively affect ERS insurance program participants
The Texas Legislature’s regular session ended May 31. As part of their commitment to returning the ERS pension plan to actuarial soundness, legislators passed a new state law to bolster the ERS Retirement Trust Fund. They also passed bills that positively affect participants in ERS insurance programs. Read more about the new laws affecting ERS-administered benefits.
ERS Retirement Trust Fund
Legislation enacted in June will shore up the ERS Retirement Trust Fund and create a new retirement benefit for future state workers.
Senate Bill 321 authorizes additional funding to pay off the Retirement Trust Fund’s current $14.7 billion unfunded liability over the next three decades. It also requires ERS to implement a cash balance retirement benefit for state employees hired after August 31, 2022 (referred to as Group 4).
While the legislation directly impacts future employees, it also indirectly affects current employees and retirees: The additional money from the state and new benefit design will help stabilize the Fund and return it to actuarial soundness—and that benefits everyone.
ERS insurance programs
Texas lawmakers also maintained funding levels for eligible employees’, retirees’ and dependents’ health coverage. The appropriation, along with continued cost-saving activities by ERS, means premium rates and coverage changes in the GBP health insurance plans should remain the same for Calendar Years 2023 and 2024.
ERS will monitor legislation related to state employee benefits during the special session slated to begin July 8. Check the ERS legislation page regularly for updates on bills that could affect ERS-administered benefit programs.