Relating to cost-of-living adjustments applicable to certain benefits paid by the Teacher Retirement System of Texas and a biennial study on providing additional cost-of-living adjustments based on the effects of increased inflation.

The text as introduced · 646 words

90R723 RDR-D

By: Bucy
H.B. No. 247

A BILL TO BE ENTITLED

AN ACT

relating to cost-of-living adjustments applicable to certain

benefits paid by the Teacher Retirement System of Texas and a

biennial study on providing additional cost-of-living adjustments

based on the effects of increased inflation.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subchapter H, Chapter 824, Government Code, is

amended by adding Section 824.704 to read as follows:

Sec. 824.704. COST-OF-LIVING ADJUSTMENTS FOR INFLATION;

BIENNIAL DETERMINATION. (a) Notwithstanding any other law, the

amount of a service retirement benefit, disability retirement

benefit, or death benefit paid under this chapter is adjusted in

accordance with this section as necessary to reflect inflation.

(b) During the last seven days of October of each

odd-numbered year, the board of trustees shall set the rate of the

adjustment that will apply to the following two calendar years

based on the sum of each annual percentage increase, if any, in the

current year and the previous year in the Consumer Price Index for

Urban Wage Earners and Clerical Workers (CPI-W) published by the

Bureau of Labor Statistics of the United States Department of Labor

as determined by the commissioner of social security under 42

U.S.C. Section 415(i) for purposes of providing an annual

cost-of-living increase to social security benefit payments

payable in the next calendar year.

(c) Subject to Subsection (d), the board of trustees shall

increase the amount of a benefit payable under this chapter by

applying the adjustment rate set by the board under Subsection (b)

to the amount otherwise required to be paid as determined in

accordance with the other applicable provisions of this chapter.

(d) The board of trustees may not pay a benefit increase

under this section in any calendar year unless the board finds that

the retirement system is actuarially sound and has money available

to pay increased benefits in that year. If the board of trustees

finds that the retirement system is actuarially sound, but that the

amount of money available is not sufficient to pay the full amount

of the adjustment under Subsection (b), the board shall compute the

largest rate of adjustment possible for the amount of money

available while maintaining the actuarial soundness of the system

and shall use that rate in increasing benefits under Subsection (c)

for that calendar year.

(e) The board of trustees by rule shall define "actuarially

sound" for purposes of this section.

SECTION 2. Subchapter B, Chapter 825, Government Code, is

amended by adding Section 825.1087 to read as follows:

Sec. 825.1087. BIENNIAL STUDY AND REPORT ON PROVIDING

ADDITIONAL COST-OF-LIVING ADJUSTMENTS BASED ON EFFECTS OF

INFLATION. Not later than January 1 of each even-numbered year, the

retirement system shall:

(1) conduct a study to evaluate and identify the

effects, if any, that increased inflation has had on annuitants of

the system:

(A) during the preceding state fiscal biennium;

and

(B) unless the annuitants received a

cost-of-living adjustment in the preceding fiscal year, since

annuitants last received a cost-of-living adjustment; and

(2) submit a written report to the legislature

containing:

(A) findings of the study; and

(B) if appropriate, recommendations for

potential legislation to address any adverse effects of inflation

identified under Subdivision (1), including specific

recommendations regarding whether and in what amount the

legislature would need to provide a cost-of-living adjustment to

the benefits of annuitants to remedy those effects.

SECTION 3. Section 824.704, Government Code, as added by

this Act, applies only to a benefit paid by the Teacher Retirement

System of Texas on or after January 1, 2028.

SECTION 4. This Act takes effect immediately if it receives

a vote of two-thirds of all the members elected to each house, as

provided by Section 39, Article III, Texas Constitution. If this

Act does not receive the vote necessary for immediate effect, this

Act takes effect September 1, 2027.