AUSTIN, Texas (AP) – State employees are set to see an increase in the amount they contribute to their retirement plans – a move lawmakers say will shore up the chronically underfunded Employee Retirement System of Texas.
The Texas House preliminarily approved a bill Monday increasing all employees’ contributions to the fund to 9.5 percent. Contributions currently vary depending on employee position.
Half a million-plus employees, retirees and their relatives depend on the fund for retirement and health benefits.
The state would also increase its contributions, from 7.5 percent to 9.5 percent, and employees would see a 2.5 percent pay raise.
The bill needs a final, procedural House vote before heading to the Senate.
Without it, lawmakers say, the fund would remain actuarially unsound. Its unfunded balance was about $7.5 billion last year alone.