SB 405 — AN ACT CONCERNING VALUATIONS OF THE TEACHERS' RETIREMENT SYSTEM.

Senate General Assembly RaisedFile Bill No.

405564 February Session, 2022 LCOSubstitute Senate Bill No.

2031405 ReferredSenate, toApril 21, 2022 The Committee on APPROPRIATIONSAppropriations Introducedreported by:through SEN.

(APP)OSTEN ANof ACTthe CONCERNING19th THEDist., TEACHERS'Chairperson RETIREMENTof BOARDthe ANDCommittee VALUATIONSon OFthe THEpart TEACHERS'of RETIREMENTthe SYSTEM.Senate, that the substitute bill ought to pass.

AN ACT CONCERNING VALUATIONS OF THE TEACHERS' RETIREMENT SYSTEM.

(a) (1) On and after July 1, 1991, the management of the system shall continue to be vested in the Teachers' Retirement Board.Board, whose membersshallinclude theTreasurer,theSecretaryoftheOfficeofPolicy and Management and the Commissioner of Education, or their designees, who shall be voting members of the board, ex officio.

[, whose] The board shall be within the Retirement Division of the Office of the State Comptroller for administrative purposes only.

The members shall include the Treasurer, the Comptroller, the Secretary of the Office of Policy and Management and the Commissioner of Education, or their designees, who shall be voting members of the board, ex officio.

Both of such persons shall be active teachers who shall be nominated by the members of the LCOsystemwho No.are notretiredandelectedbyallthemembersofthesystem.

2031On 1or ofbefore 4July Raised1, Bill1991, No.405and systemwhoquadrennially arethereafter, notretiredandelectedbyallthemembersofthesystem.the members of sSB405 / File No.

On564 or1 beforesSB405 JulyFile 1,No. 1991, and quadrennially thereafter, the members of the system shall elect from their number, in a manner prescribed by said board, three persons to serve as members of said board for terms of four years beginning July first following such election.

564 the system shall elect from their number, in a manner prescribed by said board, three persons to serve as members of said board for terms of four years beginning July first following such election.

(b) In carrying out its duties, the board may employ a chief LCOadministrator No.with a title established by the board, who shall also serve as secretary of the board, an administrative officer and such staff as may be necessary.

2031Their 2salaries ofshall 4be Raisedpaid Billby said board with the sSB405 / File No.

405564 administrator2 withsSB405 aFile titleNo. established by the board, who shall also serve as secretary of the board, an administrative officer and such staff as may be necessary.

Their564 salaries shall be paid by said board with the approval of the Secretary of the Office of Policy and Management.

Said board shall arrange for such actuary to prepare an actuarial valuation of the assets and liabilities of the system as of June 30,[30, 1980, and at least [onceonce every two years]years annuallythereafter] thereafter.thirtieth, annually.

Commencing[Commencing December 1, 2002, suchsuch] Such valuation shall be completed prior to December firstfirst, [biennially] annually.

Said board shall [establish]establish prepare an operational budget necessary for the management of the systemsystem. and submit the budget to the Office of the State Comptroller.

Section 1 July 1, 2022 10-183l Statement of Purpose:Legislative Commissioners:

ToIn placeSubsec. the Teachers' Retirement Board within the Office of the State Comptroller for administrative purposes and to require annual valuations of the Teachers' retirement system.

LCO(b), No."June 30, 1980, and at least [once every two years] annually thereafter" was changed to "June [30, 1980, and at least once every two years thereafter] thirtieth, annually" and "Commencing December 1, 2002, such valuation shall be completed prior to December first [biennially] annually" was changed to "[Commencing December 1, 2002, such] Such valuation shall be completed prior to December first, [biennially] annually" for accuracy and clarity.

2031sSB405 3/ ofFile 4 Raised Bill No.

405564 [Proposed3 deletionssSB405 areFile enclosedNo. in brackets.

Proposed564 additionsAPP areJoint indicatedFavorable bySubst. underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.] LCO No.

2031sSB405 4/ ofFile 4No.

564 4 sSB405 File No.

564 The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose.

In general, fiscal impacts are based upon a variety of informational sources, including the analyst’s professional knowledge.

Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note State Impact:

Agency Affected Fund-Effect FY 23 $ FY 24 $ Teachers' Retirement Bd.

GF - Cost None Approximately $60,0000 Note:

GF=General Fund Municipal Impact:

None Explanation The bill changes the Teachers' Retirement System valuation from being performed on a biennial basis to an annual basis.

Under current law, the June 30, 2022 actuarial valuation, establishing the TRS actuarially determined employer contribution for FY 24 and FY 25 will be completed in November 2022 and is funded in the agency's FY 23 budget.

This change will result in an additional cost of approximately $60,000 in FY 24 to support the actuarial costs for the June 30, 2023 valuation.

The Out Years The annualized ongoing fiscal impact identified above would continue into the future subject to inflation.

Sources:

Core-CT Financial Accounting System TRB Testimony sSB405 / File No.