Texas House Bill HB75

Texas 2025 - 89th 1st C.S.

• Filed: 7/14/25

Caption

Relating to providing a cost-of-living adjustment applicable to certain benefits paid by the Employees Retirement System of Texas.

Summary

HB 75 would create a new cost-of-living adjustment (COLA) for certain monthly benefits paid by the Employees Retirement System of Texas (ERS). The bill adds a new Government Code section requiring ERS to increase eligible service retirement, disability retirement, death benefit, and certain alternate payee annuities beginning with January 2026 payments. The adjustment applies only to specified annuitants who were already eligible in December 2025 and who meet additional timing requirements tied to the retiree’s retirement date, the member’s date of death, or the alternate payee election date. The bill sets the COLA at either 7 percent or 4 percent, depending on when the underlying retirement, death, or election date occurred. In general, the higher 7 percent adjustment applies to benefits tied to dates on or before August 31, 2014, while the 4 percent adjustment applies to later dates. The bill directs the ERS board of trustees to recompute monthly annuities accordingly and specifies that the new adjustment is in addition to any other adjustment already authorized by law, including any adjustment under Section 814.604.

Impact

HB 75 would amend Chapter 814 of the Government Code by adding a new Section 814.605 and would affect benefit payments under Chapters 804, 814, and 820 as they relate to ERS annuitants. It would increase monthly pension obligations for qualifying retirees, disability retirees, beneficiaries, and alternate payees, thereby affecting state retirement system liabilities and potentially requiring additional funding to cover the enhanced benefits. The bill excludes certain elected-class members and survivor benefits from the adjustment, and it gives the ERS board responsibility for determining eligibility and calculating the amount of each increase.

Sentiment

The available record shows no committee transcript and no recorded votes, so there is no documented debate or formal vote history to indicate support or opposition. Based on the bill’s subject matter, it appears to be a benefit-enhancement measure intended to provide inflation relief to retirees and beneficiaries in the state retirement system. The filing of the bill suggests an interest in improving retirement income, but the legislative record provided does not show whether the proposal was advanced, opposed, or amended.

Contention

The main policy issues likely to draw attention are cost and eligibility. The bill limits the COLA to certain annuitants and excludes elected-class retirees, some survivor beneficiaries, and benefits under other subtitles, which could be viewed as creating uneven treatment among ERS participants. Another possible point of contention is the fiscal impact on the retirement system and the state budget, since a permanent increase in monthly benefits can raise long-term liabilities. The different 7 percent and 4 percent rates, based on retirement or election timing, may also be debated as to whether they are equitable and appropriately targeted.