HB5156 - Relating to cost-of-living adjustments applicable to certain benefits paid by the Teacher Retirement System of Texas.

  89R16066 RDR-D     By: Bryant H.B. No. 5156       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.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter H, Chapter 824, Government Code, is   amended by adding Sections 824.704 and 824.705 to read as follows:           Sec.   824.704.     COST-OF-LIVING ADJUSTMENT: JANUARY 2026. (a)     Notwithstanding any other section of this subchapter, the   retirement system shall make a one-time cost-of-living adjustment   payable to annuitants receiving a monthly death or retirement   benefit annuity, as provided by this section.           (b)     Subject to Subsections (c) and (d), to be eligible for   the adjustment, a person must be, on the effective date of the   adjustment and disregarding any forfeiture of benefits under   Section 824.601, an annuitant eligible to receive:                 (1)     a standard service or disability retirement   annuity payment;                 (2)     an optional service or disability retirement   annuity payment as either a retiree or beneficiary;                 (3)     an annuity payment under Section 824.402(a)(3) or   (4);                 (4)  an annuity payment under Section 824.502; or                 (5)     an alternate payee annuity payment under Section   804.005.           (c)  If the annuitant:                 (1)     is a retiree, or is a beneficiary under an optional   retirement payment plan, to be eligible for the adjustment under   this section:                       (A)     the annuitant must be living on the effective   date of the adjustment; and                       (B)     the effective date of the retirement of the   member of the retirement system must have been before January 1,   2025;                 (2)     is a beneficiary under Section 824.402(a)(3) or   (4) or 824.502, to be eligible for the adjustment:                       (A)     the annuitant must be living on the effective   date of the adjustment; and                       (B)     the date of death of the member of the   retirement system must have been before January 1, 2025; or                 (3)     is an alternate payee under Section 804.005, the   annuitant is eligible for the adjustment only if the effective date   of the election to receive the annuity payment was before January 1,   2025.           (d)     An adjustment made under this section does not apply to   payments under:                 (1)     Section 824.203(d), relating to retirees who   receive a standard service retirement annuity in an amount fixed by   statute;                 (2)     Section 824.304(a), relating to disability   retirees with less than 10 years of service credit;                 (3)     Section 824.304(b)(2), relating to disability   retirees who receive a disability annuity in an amount fixed by   statute;                 (4)     Section 824.404(a), relating to active member   survivor beneficiaries who receive a survivor annuity in an amount   fixed by statute;                 (5)     Section 824.501(a), relating to retiree survivor   beneficiaries who receive a survivor annuity in an amount fixed by   statute; or                 (6)     Section 824.804(b), relating to participants in   the deferred retirement option plan with regard to payments from   their deferred retirement option plan accounts.           (e)     An adjustment under this section must be made beginning   with an annuity payable for the month of January 2026.           (f)     The amount of the adjustment provided under this section   is calculated by multiplying the amount of the monthly benefit   subject to the adjustment by six percent.   The adjustment under this   section is in addition to the adjustments, if any, granted under   Section 824.702, 824.703, or 824.705 or any other law.           Sec.   824.705.     COST-OF-LIVING ADJUSTMENTS FOR INFLATION;   ANNUAL 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)     Each year, during the last seven days of October, the   board of trustees shall set the rate of the adjustment for the next   calendar year to equal the annual percentage increase, if any, 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 of trustees under   Subsection (b) to the amount otherwise required to be paid as   determined in accordance with the other applicable provisions of   this chapter.   The adjustment under this section is in addition to   the adjustments, if any, granted under Section 824.702, 824.703, or   824.704 or any other law.           (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.          SECTION 2.  The Teacher Retirement System of Texas is   required to make a cost-of-living adjustment under Section 824.704,   Government Code, as added by this Act, only if the board of trustees   of the Teacher Retirement System of Texas finds that the   legislature appropriated money to the retirement system in an   amount sufficient to provide the payment without increasing the   unfunded actuarial liabilities of the retirement system.  The   amount appropriated by the legislature to provide the payment must   be in addition to any amounts the state is required to contribute to   the retirement system under Subchapter E, Chapter 825, Government   Code. If the board of trustees of the Teacher Retirement System of   Texas finds that the legislature did not appropriate money in an   amount sufficient to provide the cost-of-living adjustment without   increasing the unfunded actuarial liabilities of the retirement   system, the retirement system may not make the adjustment payment.          SECTION 3.  Sections 824.704 and 824.705, Government Code,   as added by this Act, apply only to a monthly benefit payment made   by the Teacher Retirement System of Texas on or after January 1,   2026.          SECTION 4.  This Act takes effect September 1, 2025.