HB379 Alabama 2021 Session

Summary

Primary Sponsor

Joe LovvornRepresentative

Republican

Session

Regular Session 2021

Title

Education Retirees' Trust Fund Funding Act, Education Retirees Trust Fund created in State Treasury as permanent trust to fund periodic bonus checks for education retirees, duties of TRS Board of Control specified

Summary

HB379 would create the Education Retirees' Trust Fund in the State Treasury as an irrevocable trust to fund periodic bonus checks for Alabama education retirees and their beneficiaries.

What This Bill Does

The bill establishes the Education Retirees' Trust Fund and assigns the Teachers' Retirement System Board of Control to oversee it, with trustees managing investments and distributions. It authorizes funding from sources other than the Education Trust Fund (such as investment income, gifts, grants, and legislature-directed revenues) and prohibits use of Education Trust Fund revenue. If actuary-certified assets reach at least $100 million, the trustees may transfer the funded amount to the Teachers' Retirement System to help pay periodic bonuses. The assets are intended to be irrevocable, tax-exempt, and protected from creditors, with annual financial statements and independent audits required.

Who It Affects

• Education retirees and their beneficiaries, who may receive periodic bonus checks funded by the trust.
• The Teachers' Retirement System and its Board of Control, which would create, manage, and oversee the trust and its investments and distributions.

Key Provisions

• Creates the Education Retirees' Trust Fund in the State Treasury as an irrevocable trust.
• Purpose is to hold assets and earnings to provide periodic bonus checks to retirees and beneficiaries of the Teachers' Retirement System.
• Funding sources must be other than the Education Trust Fund, including investment income, gifts/grants/contributions, and legislature-directed revenues.
• Trustees (on the Board of Control) manage the trust, serve without compensation (reimbursed for expenses), and have immunity from suit; they may be indemnified.
• Trust funds may be invested in any permitted investments; administrative expenses and bonuses may be paid from the trust.
• If assets exceed $100 million per actuary, the trustees may transfer those assets to the TRS to fund bonuses.
• The trust can be amended for tax advantages, to qualify as a post-employment benefits trust, or as court-directed, under specified conditions.
• Assets and income are exempt from state taxation and protected from creditors; not subject to execution or garnishment.
• Requires annual financial statements and independent audits of the trust’s finances.
• Diversity provision requires personnel and vendors working with the trust to reflect the state's racial and ethnic diversity.
• Effective date is the first day of the third month after passage and approval.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Education Retirees' Trust Fund Funding Act