Home > Public Capital > Archives > Employee Retirement System of Texas category
Employee Retirement System of Texas
October 15, 2009
MacBride named to fill ERS board vacancy
Cheryl MacBride, a deputy commissioner at the General Land Office, has been tapped to complete an unexpired term on the six-member board of the Employee Retirement System of Texas.
A 25-year veteran of state service, MacBride will occupy one of three seats for members of the system until 2013. She replaces Don Green, who retired in May.
MacBride now oversees administration services for the GLO but will soon head over to the Department of Public Safety where she will be the chief financial officer.
Permalink | Comments (0) | Post your comment Categories: Employee Retirement System of Texas
September 25, 2009
Former Statesman reporter vying for ERS board
Many loyal followers of Public Capital during its golden years are probably suffering from some Bob Elder withdrawal.
Now, they can get their fill here of the former Austin American-Statesman reporter and this blog’s founder.
A state employee for almost a year, Elder has applied to fill a vacancy on the Employees Retirement System of Texas board and has launched the blog as part of his campaign.
The board will pick the replacement for Don Green, who retired earlier this year.
Mary Jane Wardlow, an ERS spokeswoman, said she did not know who else filed for the open spot. The plan is to have someone in place by November.
Permalink | Comments (11) | Post your comment Categories: Employee Retirement System of Texas
July 17, 2009
ERS lends heft to argument for $500 payment to retirees
As the Office of the Attorney General mulls the legality of a $500 supplemental payment to retired state workers and teachers, the general counsel of the Employee Retirement System of Texas says it would be “reasonable” to determine that payment does not run afoul of the state constitution.
Legislative budget-writers asked the attorney general to determine if the payment, which would come from the state’s general fund and not the retirement trust funds, would violate a provision of the Texas Constitution that prohibits the payment of extra compensation for services already rendered.
As expected, retiree and employee groups argue in legal briefs that the payments are not a problem.
But the ERS brief adds some additional weight to that argument since a decision against the one-time payment would actually better serve the retirement system’s obligation to both current retirees and future retirees.
If the $155 million does not go directly to the retirees, it will be split among the trust funds of ERS and the Teacher Retirement System of Texas.
“An increase in the state’s overall contributions to the trust fund will bring the fund closer to actuarial soundness, and, therefore, will increase the fund’s long-term financial stability. Such a result inures to the benefit of both annuitants and active employees,” according to the brief.
Even so, Paula Jones, the ERS general counsel, writes in a brief submitted to the attorney general that the $500 payment would not be considered compensation under federal tax law. Nor would it fit within the definition of “compensation” under state law, Jones wrote.
“ERS believes it is reasonable for the (Office of the Attorney General) to determine that the one-time payments described in the (budget) are not ‘compensation’ being paid in contravention of” the state constitution.”
Permalink | Comments (6) | Post your comment Categories: Employee Retirement System of Texas
May 26, 2009
State employees' retirement contribution to rise
State employees will soon be chipping in more for their retirement under a bill that passed the Senate Tuesday on a final vote of 26 to 5.
Members of the Employee Retirement System of Texas will now contribute 6.45 percent of their pay to the pension fund, an increase over the current 6 percent contribution rate. For an employee making $50,000 a year, the annual increase would be $225.
The new rate matches what the state contributes to the fund.
The change in the contribution rate along with some benefit adjustments for new hires are needed to address a persistent gap between the combined contributions and the annual cost of the benefits being earned - known as the normal cost.
“The money going in is slower than the money going out,” said Sen. Robert Duncan, R-Lubbock, chairman of the State Affairs Committee. “Eventually the fund will erode and it will be a serious problem for our retirees.”
The modifications would have a significant impact in moving the fund toward actuarial soundness, according to the bill analysis for House Bill 2559. Similar changes were made in 2005 to the Teacher Retirement System of Texas that improved the fiscal condition of the fund, enabling it to pay a 13th check to retirees last year, Duncan said.
“We’re going to turn this thing around for our retired state employees,” Duncan said.
Sen. Kirk Watson, D-Austin, voted against the measure because he said the state is doing too little while asking more of the employees.
“This half-step is being made almost entirely by our state employees,” Watson said.
Employee groups have mixed feeling about the changes.
“We’re not thrilled about it, but how long do you let a problem like this fester?” said Andy Homer, director of government relations for the Texas Public Employees Association. “It’s What you have to do to get the fund back into shape.”
Employees would prefer to increase their contribution rate from 6 percent of wages to 6.5 percent to bolster the trust fund’s long-term health rather than enact a major change in retirement eligibility, according to a survey by the employees association.
But Mike Gross, vice president of the Texas State Employees Union, said the change would amount to a pay cut for employees since many are getting no raises or bonuses in the upcoming budget.
He said the state should bump up its contribution rate by the same amount as the employees.
That might just happen — by accident — depending upon how the attorney general rules on proposed $500 bonus for retirees.
Questions surfaced recently about whether a one-time bonus to retirees from state money would run afoul of a constitutional provision that prohibits extra compensation.
If the Attorney General finds the bonus to be legal, the retirees will get a little extra walking around money. If not, the state will increase its contribution to the trust funds.
Permalink | Comments (9) | Post your comment Categories: Employee Retirement System of Texas
February 6, 2009
Health of pension funds top priority, Duncan says
State retirees will probably be left wanting for a boost to their pension benefits given the precipitous drop of the state’s pension trust funds.
“The goal should be something else this session because the health of these funds should be our number one priority,” said Sen. Robert Duncan, chairman of the State Affairs Committee that oversees the pensions. “The priority is not more benefits, it is preserving the funds.”
Representatives from the teacher and employee groups say they have not given up on a supplemental payment. But the money will have to come from the Legislature, not the trust fund.
The health of the trust fund is key priority for the groups, as well. And Andy Homer of the Texas Public Employees Association said state employees would probably be willing to up their contribution rate if the state puts in more, too.
Here is TPEA’s look at the Employee Retirement System of Texas trust fund, which includes the following quote from executive director Gary Anderson:
“While there is no threat to payment of benefits for retirees, there is little chance that ERS will ever be able to grant another retirement benefit increase, for current or future retirees.
The retirement fund is out of actuarial balance, in essence it’s running an ever-worsening deficit, since we’re not even contributing enough to cover the cost of currently accruing retirement benefits.
It is in everyone’s interest, both current retirees and active employees, to restore the fund to actuarial health.”
Permalink | Comments (12) | Post your comment Categories: Employee Retirement System of Texas
November 10, 2008
Campos rebounds from TRS tussle
Seems that Roel Campos has found a way to occupy himself after his Washington law firm withdrew last week as fiduciary counsel for the Teacher Retirement System of Texas.
The former U.S. Securities Exchange Commissioner is a member of President-elect Barack Obama’s Transition Economic Advisory Board. The board also includes former Treasury secretaries Robert Rubin and Larry Summers, business leaders such as Google chairman Eric Schmidt and Michigan Gov. Jennifer Grantholm.
Campos, a partner with Cooley Godward Kronish, withdrew as the fiduciary counsel for the retirement system after the attorney general’s office refused to approve his firm’s contract due to concerns about potential conflicts of interest.
Permalink | Comments (0) | Post your comment Categories: Employee Retirement System of Texas
