Senator files plan to change TRS to 401k-style plan

By Cory Smith | news@campcountynow.com

With the 84th Texas Legislative session in full swing, Sen. Paul Bettencourt (R-Houston) has filed two bills that may convert the Teacher Retirement System of Texas (TRS) defined benefit plan—which offers a lifetime benefit for Texas educators—to a defined contribution (401k-style) or hybrid plan for new and future education employees.
The bills face staunch opposition from those in the education field and especially from the Texas Retired Teachers Association which has stated it opposes any change to the defined benefit plan for future education employees.
According to the TRTA, having new education employees go into a defined contribution or hybrid style retirement plan: does not provide them retirement security after their career in education is over; will not solve the TRS unfunded liability issue, as TRS would no longer be investing new contributions and managing pension obligations with a long-term view; does not create a path to a secure retirement.