HB485 Alabama 2019 Session

Summary

Primary Sponsor

Rod Scott

Democrat

Session

Regular Session 2019

Title

State Treasury, Education Retirees' Trust Fund, created, cost-of-living adjustments, to provide funding by lottery if one is authorized

Summary

HB 485 would create an irrevocable Education Retirees' Trust Fund to fund cost-of-living adjustments for Alabama education retirees, using lottery proceeds if a lottery is approved.

What This Bill Does

It establishes the Education Retirees' Trust Fund for COLAs in the State Treasury, to be managed by the Teachers' Retirement System Board of Control and used only for eligible investments, administrative expenses, and COLA benefits. The primary funding source is the lottery, with 25% of net lottery proceeds annually dedicated to the trust. When the actuary certifies that the trust has enough assets to fund a 1% (or higher) COLA, the assets are transferred to the Teachers' Retirement System to fund that COLA beginning October 1. The trust and its assets are tax-exempt, creditor-protected, and subject to annual reporting and auditing.

Who It Affects

• Education retirees and their beneficiaries, who would receive cost-of-living adjustments funded by the trust once sufficient assets exist (starting with a 1%+ COLA).
• The Teachers' Retirement System Board of Control and the state, which would establish, administer, and oversee the trust, manage investments, and facilitate transfers to fund COLAs.

Key Provisions

• Creates the irrevocable Education Retiretes' Trust Fund for Cost-of-Living Adjustments to fund COLAs for education retirees.
• Primary funding source is the lottery; 25% of net lottery proceeds dedicated to the Education Trust Fund are appropriated to the trust annually.
• Trustees (Board of Control) manage the trust, determine investment and administrative rules, and may contract with professionals as needed.
• If actuarial certification shows sufficient assets to fund a 1%+ COLA, the trust transfers the certified amount to the Teachers' Retirement System to fund the COLA effective October 1.
• Assets and income of the trust are tax-exempt and protected from creditors; annual financial statements and independent audits are required.
• The act is contingent upon ratification of a constitutional lottery amendment and becomes effective upon passage, approval, or as otherwise provided, tied to that ratification.

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

Subjects

State Treasury