November 19th

Coalition Grows for Volunteer Protection Legislation

TACT President Tom Hoffman's president's message in the TACT Quarterly
Bulletin correctly observes, "University professors are often called upon
to serve on nonprofit boards (and) individuals acting in good faith on
behalf of organizations should not be at personal risk of liability for the
actions and policies of the organizations for whom they serve."

The Texas Society of Association Executives (TSAE) has joined with TACT by
including in its legislative agenda Volunteer Protection legislation in
support of directors and officers of nonprofit organizations. The
November/December issue of Association Leadership, the TSAE journal, quotes
TACT Executive Director Chuck Hempstead, "My association has put this issue
on our legislative agenda, and I hope others would do so as well. My hope
is that state legislation will lessen the need to purchase officers and
directors liability insurance."

November 16th

Senate Committee Adopts TACT Recommendation

Following TACT President Tom Hoffman's testimony last spring, 
the Interim Senate Committee on State Affairs has included in 
its report to the 76th Legislature that the multiple-tiered 
employer contribution to the Optional Retirement Program be 
eliminated by increasing the rate for "all ORP participants 
to the higher level."

Page 9 of the report states, "The inequity has caused two 
problems within Texas' higher education system. Morale is 
affected, and the lower rate negatively impacts recruiting 
quality professors to institutions of higher education. 
Higher education groups including the Texas Association of 
College Teachers (TACT) have requested that all ORP participants 
be returned to the same level."

The report also includes a discussion of the difference between 
defined benefit and defined contribution retirement plans and 
recommends that all employees be allowed a one-time opportunity 
to switch between ORP and TRS. The most interesting TRS recommendations 
include that "The Committee is committed to reaching the highest 
multiplier for all current and future retirees when the TRS fund 
can sustain that increase." A House Bill has already been filed 
consistent with TACT's suggestion that the multiplier be raised 
from 2.0% to 2.25%. Also, the report says that, "In addition to 
the CPI catch-up, another two to five percent ad hoc increase 
should be considered."

TACT will use these recommendations during its advocacy 
before policy and appropriations committees during the session, 
and printed copies of these important report pages will be sent to 
TACT chapter presidents. ORP participants hired since 1995 should 
be reminded that TACT's success on the single-tier issue is worth 
$107,000 to them.

November 14th

		Urgent Help Needed!  

The'Texas Association of College Teachers has endorsed the candidacy of 
Dr. Mary Alice Baker for the institution of higher education position on 
the Board of Trustees of the Teacher Retirement System of Texas (TRS).

Dr. Baker is a past president of TACT and currently serves as Legislative 
Committee Chair. Read More

Please assist our effort to secure representation at TRS by calling your 
colleagues and requesting assistance with the petition.

Petition

September 29th

A recent follow-up with staff of the Interim Senate State Affairs Committee 
indicates that the TACT-drafted language encouraging 8.5 percent ORP 
contribution to all participants should be included in the Committee Report. 
We will use this recommendation at appropriations hearings in the spring, 
and all faculty on your campus hired since September 1, 1995 should be 
apprised of what we're doing for them. 

A scenario to indicate the difference between a 6% and 8.5% state 
contribution (employee's contribution not included):

A faculty member is hired at $30,000 and receives a 2 percent annual salary 
increase for 30 years with an 8 percent return on his invested employer 
portion of his ORP. If his employer contribution is 6%, his cash value at 30 
years is $258,139. If the employer contribution is 8.5%, his cash value is 
$365,697. A $60 TACT MEMBERSHIP THIS YEAR MAY BE WORTH $107,558.

August 31st - Workload Survey

The 1998 Faculty Workload Survey is now ONLINE! Why not take a momment
to answer a few questions? Your input is vital to the success of 
this important project.   Workload Survey

August 14th

The Honorable Ken Armbrister
Texas State Senate
P.O. Box 12068
Austin, TX   78711

Dear Senator Armbrister:

Because you have been intimately involved with issues regarding public
employee retirement systems, you know that the Texas Optional Retirement
Program has become increasingly diverse in its funding policies. No
fewer than three special provisions to the Appropriations Bill address
ORP funding, and their interpretation across the state has not been
uniform (see enclosures). Anecdotes abound that the resulting
three-tiered ORP funding levels are hurting recruitment of faculty and
creating a morale problem between the haves and have-nots. Your
committee has the opportunity to recommend fixing this problem during
the next legislative session. 

We still believe that the Legislature should return to the state
contribution of 8.5 percent of salary for all participants  as it was
funded between 1980 and 1991. Next best would be the approach taken
between 1992 and 1995, when the Legislature funded 7.31 percent for all
participants and the institutions were permitted to supplement the
state's contribution with 1.19 percent from local or other funds. 

In Committee, you discussed the dilemma of faculty hired in August 1995
but who received their first paychecks in September 1995. They thought
they would be credited 8.5 percent of salary, but a Comptroller's ruling
granted only 6 percent. Our concern is not only for these individuals
who made their irrevocable decision to participate in ORP based on
information which turned out to be faulty, but we think all new hires
since then should receive the same retirement benefits as their
colleagues. 

Using Coordinating Board data, 2,624 new faculty, staff and
administrators were hired at senior and community colleges during FY
1996 and chose ORP. With an average salary of $27,875, the cost to the
state of bringing them from 6 percent to 7.31 percent is less than $1
million annually. Projecting through the current biennium at the same
rates, the prospective cost to the Legislature in 1999 to return these
10,496 new ORP hires would be less than $4 million. 

In fact, the Coordinating Board shows total ORP participants to be
relatively constant: 37,025 in FY 1995;  35,905 in FY 1996; and 36,829
in FY 1997.  This indicates that new ORP participants are replacing
retirees, so the net cost to the State is less, even if the new hires
were to receive the same ORP State contribution rate, since lower
salaried participants are replacing higher salaried participants. 

Enclosed are drafts of potential language for the Committee's Interim
Report and an Appropriations Bill rider consolidating the existing three
Special Provisions. We appreciate your consideration of creating a
stable, predictable, equal contribution rate for all participants of the
Optional Retirement Program, and look forward to helping the Committee
with any additional information it requests.

Sincerely, 



Chuck Hempstead
Executive Director

c:   Members, Senate Interim Committee on State Affairs

"ATTACHMENT TO LETTER ABOVE"

Proposed Language for Senate State 
Affairs Committee Interim Report

The Committee believes that the Texas Optional Retirement Program,
created in 1967, is an appropriate and effective compensation mechanism
for recruiting and retaining quality faculty and personnel in higher
education. Furthermore, the Committee believes that all eligible
personnel choosing ORP should receive the same percentage of salary that
the State has generally contributed since 1980, though they should be
aware that the percentage may fluctuate in the future.

Proposed Special Provision Regarding ORP to 
Consolidate the Existing Three

State Contribution to the Optional Retirement Program


The amount specified above in (A.1.3), Optional Retirement, is based on
a state contribution of 6.00% of payroll for each fiscal year,
estimated. Additionally, included in the appropriation to institutions
of  higher education in this act are general revenue amounts intended to
offset local funds used for the optional retirement program employer
contribution between 6% and 7.31% of salaries. These general revenue
amounts are included in the funding formulas for general academic
institutions and two-year institutions and in the base funding for other
institutions of higher education. Institutions and agencies authorized
under state law to provide the Optional Retirement Program to their
employees are authorized to use local funds or other sources of funds to
supplement the General Revenue Fund appropriation in order to provide no
more than 8.5% employer contribution.

-end of attachment-

July 27th

Faculty hired since Fall 1995 should be made aware that TACT is petitioning
the Senate State Affairs Committee to raise the state contribution to ORP from
6 percent to 7.31 percent, plus allow institutions to supplement up to 8.5
percent. Considering only the 1.31 percent differential (from 6 percent to 7.31
percent), this equates to an average additional $600.00 retirement contribution
annually, plus unknowable accumulations during the course of a career. Investing
10 percent of one's first-year bonus to TACT ($60.00 dues) increases the 
likelihood of many years of that extra $600.00.

May 15th

The University of Texas System Board of Regents voted May 14 to limit 
the number of approved ORP companies to 8, down from the 15 companies 
currently approved.  Faculty relationships with companies not on the new 
list are protected through a grandfathering provision. 

The approved companies on the new list include:

Aetna
The Copeland Companies
Fidelity Investments
Great West Life 
Lincoln National Life
Metropolitan Life
TIAA-CREF
VALIC

April 9th

The Texas legislative interim committees are in full swing, though not much 
newsworthy testimony has yet been presented regarding faculty issues.  An 
exception occurred during the recent House Higher Education Subcommittee on 
Education Funding.  A Legislative Budget Board staff member compared the 
nearly $1 billion increase requested in the Back-to-Basics initiative 
championed by the Higher Education Coalition with the actual appropriated 
amounts for those same programs ($409 million, or 44 percent of the 
Back-to-Basics request).  According to a survey of institutions as to how 
they budgeted the $150.6 million increase in the General Academic Formula 
Funding, 35% ($52.6 million) went to faculty salary increases, 5% ($7.6 
million) was used for new faculty positions, 12% ($18.2 million) was used 
for staff salary increases, and 2% ($3.4 million) was used for new staff 
positions, totaling 54%, or $81.32 million).

Possibly the most interesting comments were made at the conclusion of the 
hearing by Chairman Henry Cellar (House sponsor of the post-tenure review 
bill last session).  He said that the Legislature was more involved last 
session with higher education issues than ever before (workload, post-tenure 
review, performance criteria) and that we, the higher education community, 
should expect a continuation of legislative involvement in 1999.

Next: the Senate State Affairs Committee will hear public testimony at 10:00 
AM Wednesday, April 22 on ORP and TRS.  TACT will testify.

March 12th

Higher Education Primary Election Analysis

Voter turnout Tuesday was an abysmal 11 percent, with more Republicans than 
Democrats showing up for the first time this century. 

The Texas Senate will remain more stable than in recent years, with the 
significant exception of a new Lt. Governor (see Sharp and Perry's comments 
in the next TACT Quarterly Bulletin).  Remember that the Senate is now 
Republican-controlled, though two Republicans who are TACT supporters -- 
Haywood and Ogden -- have tough races in November. 

The Republicans' "8 in 98" strategy to control the House is in full swing -- 
consistent with what we heard at our recent TACT Conference about the 
increasing partisanship of the Texas Legislature.  Two members of the House 
Higher Education Committee will not be returning: Kamel and Rabuck.  Other 
TACT supporters not returning are: Hirschi, Berlanga, Stiles, Oakley and 
Hightower.  We need to educate their successors about our issues while they 
are campaigning.

With the primaries behind us, now is the time for faculty and TACT chapters 
to arrange some "face time" with the November candidates.  If you would like 
a more specific analysis of the races in your area, contact the TACT State 
Office.

February 12th

The Senate Interim State Affairs Committee is scheduled to hear invited 
testimony regarding TRS and ORP beginning at 2:00 PM on Thursday, February 
19 in Room E1.208 of the State Capitol (Extension).  TACT intends to testify 
and welcomes your input as we draft our presentation.