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TRS-Related Legislation Summary

June 27, 2019 • April Mabry

TRS-Related Legislation Summary

Contribution rates

Senate Bill 12 (SB 12) gradually increases the rate of contributions to the Teacher Retirement System (TRS) by the state, TRS members, and school districts. This is intended to make TRS actuarially sound immediately. SB 12 also includes a change for school districts currently paying into Social Security on behalf of their employees. These districts will no longer be exempt from paying into TRS, effective September 1, 2019.

Contribution rates will incrementally increase as shown in the chart below:

Year (beginning Sept 1) Member Contribution % State Contribution % Employer Contribution %* Retire/Rehire Surcharge %**
2018–2019 7.7 6.8 1.5 14.5
2019–2020 7.7 7.5 1.5 15.2
2020–2021 7.7 7.5 1.6 15.2
2021–2022 8.0 7.75 1.7 15.75
2022–2023 8.0 8.0 1.8 16.0
2023–2024 8.25 8.25 1.9 16.5
2024–2025 8.25 8.25 2.0 16.5

*As of 2019–2020, districts participating in Social Security are required to make the employer contribution.

**An additional $535/month TRS-Care surcharge may apply.

Adjustments to the required member and employer contributions will be made if the state contribution rate is less than the amount specified in the bill.

Supplemental payment to retirees

SB 12 requires TRS to make a one-time supplemental payment to retirees who retired by December 31, 2018. Often referred to as the “13th check,” the amount will be equal to the amount of an individual’s annuity payment for the month immediately prior to the month in which TRS issues the payment or $2,000, whichever is less. The payment must be made no later than September 2020.

Certification of investment products

House Bill 2820 (HB 2820) removes authority from TRS for oversight of qualified investment products available to employees of educational institutions (i.e., 403(b) products). TRS will no longer certify companies based on financial strength according to established criteria. An insurance company is eligible to offer qualified investment products if it's licensed by the Texas Department of Insurance (TDI), is in compliance with minimum capital and surplus requirements, has experience providing qualified investment products, and has a specialized department dedicated to the service of qualified investment products, as determined by the educational institution. (Effective 9/1/2019)


April Mabry is an assistant director at TASB HR Services. Send April an email at april.mabry@tasb.org


Tagged: "Teacher Retirement System", TRS, "TRS ActiveCare", "TRS Care", "TRS surcharge"