SB350 Alabama 2018 Session

Summary

Primary Sponsor

Rodger SmithermanSenator

Democrat

Session

Regular Session 2018

Title

Education Retirees, COLA Trust Fund for TRS, created, permanent trust and investment account to fund cost-of-living adjustments to retirees, established, powers and duties of trustees, provided for

Summary

SB 350 would create a permanent, irrevocable COLA Trust Fund for the Teachers' Retirement System to fund cost-of-living adjustments for education retirees.

What This Bill Does

It creates the COLA Trust Fund for the Teachers' Retirement System as an irrevocable, permanent trust and investment account in the State Treasury to fund cost-of-living adjustments for education retirees. The Board of Control of the Teachers' Retirement System would serve as trustees, overseeing management, rules, and investments for the fund. The fund could be funded from legislative appropriations, investment income, gifts, or other permitted sources, and its assets would be used only to acquire investments, pay administrative expenses, and provide COLAs; once the actuary certifies sufficiency, assets would be transferred to the TRS to fund the COLA. The assets would be tax-exempt, protected from state creditors, audited annually, and subject to possible amendments for tax advantages, GASB accounting status, or court-approved changes while preserving the COLA purpose.

Who It Affects

• Education retirees and their beneficiaries could receive COLA benefits funded by the COLA Trust Fund once conditions are met.
• The Teachers' Retirement System Board of Control would act as the trust's trustees and manage its investments and operations.

Key Provisions

• Establishes an irrevocable COLA Trust Fund for the Teachers' Retirement System in the State Treasury to hold assets and earnings for COLA payments.
• Designates the TRS Board of Control members as trustees who serve without compensation (but may be reimbursed) and gives them broad powers to manage the trust, invest funds, enter contracts, hire staff, and adopt rules.
• Identifies funding sources as legislative appropriations, investment income, gifts or contributions, and other sources; restricts use of assets to acquiring investments, paying administrative costs, and providing COLAs; the Legislature cannot appropriate trust assets.
• Requires certification from the TRS actuary to transfer a funded amount from the trust to the TRS to fund a COLA; allows amendments for tax advantages or GASB status; assets are tax-exempt, protected from creditors, and annual financial statements and audits are required.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Education