SB244 Alabama 2010 Session

Summary

Primary Sponsor

Hank Sanders

Democrat

Session

Regular Session 2010

Title

Teachers' Retirement System, pension accumulation fund, accrued liability contribution rate authorized to be computed by Board of Control over a 30-year period, Sec. 16-25-21 am'd.

Summary

The bill lets the Teachers' Retirement System spread its unfunded liabilities over up to 30 years instead of up to 20.

What This Bill Does

It amends Section 16-25-21 to allow the accrued liability contribution rate to be computed over a period not less than 10 and not more than 30 years, determined by the Board of Control. The bill keeps the three-fund structure (Annuity Savings Fund, Pension Accumulation Fund, Expense Fund) and the contribution framework, including normal contributions and accrued liability contributions as percentages of total annual compensation. The accrued liability rate would be based on actuarial valuations, with the Legislature setting the normal contribution rate in the annual appropriation. A longer amortization period could affect yearly contributions and the funding timeline, and the Board may transfer funds between the Pension Accumulation Fund and the Annuity Savings Fund to manage surpluses or deficits.

Who It Affects

• TRS members (teachers and other plan participants) whose payroll deductions fund benefits; their required contributions could change based on the new amortization period.
• Employers (local boards of education, the State Board of Education, universities and affiliated entities) who deduct and remit contributions and bear related costs; their funding obligations could change with the new rate and period.

Key Provisions

• Increases the maximum funding period for the accrued liability contribution rate from 20 years to 30 years, with the period set by the Board of Control between 10 and 30 years.
• The accrued liability contribution rate remains a percentage of total annual member compensation and is used to liquidate unfunded accrued liability over the Board-determined period.
• Retains the three funds (Annuity Savings Fund, Pension Accumulation Fund, Expense Fund) and the detailed rules for contributions, fund transfers, and crediting of contributions and interest.
• The Legislature continues to set the normal contribution rate via the annual appropriation, based on the actuary's valuation, while the Board of Control determines the accrued liability rate and amortization period.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Teachers' Retirement System