State Legislators banking on a healthy state budget surplus to ease funding tensions next session are in for an unexpected comeuppance. A major state employee benefit system for retired teachers is in danger of imminent insolvency. A surprising twist to this problem is that liberal leaning Republican legislators and Democrats could see this coming and squelched every attempt by conservative legislators to head-off the system’s decline.
Even more shocking, an organization formed to advocate on behalf of retired teachers colluded with big-spenders to block reforms designed to help teachers!
Austin can be a perplexing place during any given legislative session. Strange bedfellows and even stranger behaviors by interested parties make for an atmosphere lacking rhyme and reason. Our latest “see, we told you so” moment involves the case of the TRS-Care fund. This fund is a health benefits program for retired teachers administered by the Teacher Retirement System of Texas (TRS).
According to recent testimony by TRS leadership and the Legislative Budget Board, the TRS-Care fund will face an $875 million shortfall that threatens to make the benefit plan unaffordable to many retirees.
Now, think back to the House budget debate in April of last year. A group of conservative House members proposed a series of amendments to address the funding issues of TRS-Care by eliminating bloated, wasteful government programs and diverting the money to the beleaguered fund. Despite accepting amendments from their favored members, including an amendment to allow expansion of Medicaid under Obamacare and a ban on school choice programs, the liberal-leaning Republicans of the House leadership overwhelmingly rejected every amendment proposed by conservatives to shore-up TRS-Care funding.
At the expense of the legislature’s obligations to TRS-Care, liberal House Republicans chose to fund such state government staples as the, Governor’s Office for Women’s Groups, the Texas Historical Commission, and the Texas Film and Music Marketing program.
Ironically, the state’s largest retired teacher advocacy organization, the Texas Retired Teacher Association (TRTA) agreed with the big-spenders. TRTA decided that state money to fund video game production and subsidize billion-dollar blockbuster movies took priority over healthcare for retired teachers. In a letter issued to provide cover to fiscally reckless leadership, the TRTA rejected the amendments.
The winners in these budget battles were the well-connected special interests whose pet-projects survived another session of scrutiny. The losers are, of course, taxpayers and retired teachers who will likely face higher premiums and declining benefits thanks to the shortsightedness of their advocacy organization and the fiscal irresponsibility of state leaders. Conservatives next session will have a sad but revealing case study by which to articulate the compelling need for prudent budgeting in 2015. In light of this projected budget deficit, those affected and Texans at-large will have a surplus of hindsight to remind legislators of their poor choices come next budget season.
