Texas TRS Pension Fund Faces Funding Challenges with Lowest State Contributions

The Texas Teacher Retirement System (TRS) Board of Trustees received an actuarial review from Gabriel, Roeder, Smith & Company (GRS) highlighting that Texas employer contributions toward teacher pensions remain the lowest nationally among states without Social Security. The state contributes 8.25% while school districts contribute 2%, compared to 15% or more in peer states. Despite a strong 9.8% annual investment return exceeding benchmarks, recent legislative salary increases have offset gains, extending the pension fund's amortization period to 35 years, beyond the 30 years mandated by state law, and longer than industry best practices recommend.