Issue Position: Empower Educators

Issue Position

The Texas Constitution states that we must make suitable provision for the support and maintenance of an efficient system of public schools. While we must hold school districts responsible for improving students' results, we must also pledge an equal determination to support and empower our Texas educators

As of August 2017, Teachers Retirement System, (TRS) was funded at 76.1%. Some consider a funded ratio of 80% as healthy, but anything below 100% isn't fully funded. At that time, the unfunded obligation was $35.4 billion at 8%. The fund had under-performed for years, thus the TRS Board lowered the assumed rate to 7.25%, BUT lowering the assumed rate of return increased TRS's unfunded obligation to $46.2 billion and lengthened the amount of time this plan would need to become funded. To add further concern, the average annual return has been only 5.8% in the last decade, a more realistic rate of 6% would put the unfunded obligation at a staggering $85 billion. The Senate's supplemental bill, increased TRS funding from the Economic Stabilization Fund (ESF) by $300 million BUT raising all employees' pay could place a larger burden on the pension plan, because defined benefits are tied to employee salaries. We must support a fair teacher retirement plan by innovating strategies to fully fund TRS.

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