Study: Scrapping School Employee Pensions Costly 8/31/12
August 31, 2012
AUSTIN, Texas (AP) - A new study finds that scrapping the guaranteed pension benefit for Texas' future school employees would be costly and reduce benefits for retirees.
The Austin American Statesman reports (bit.ly/RvrfyF) Friday that an analysis by the Teacher Retirement System of Texas says the $110 billion teacher fund can pay the benefits it owes through 2075.
But it will need additional state or member contributions to erase a $24 billion long-term funding liability.
That liability would increase, though, to $36 billion if new employees were closed out of the pension and instead received a retirement benefit akin to a 401 (k).
The study was mandated by state lawmakers last year.
Despite its results, those opposing public pensions say they will press for changing the pension system during next year's Texas Legislature session