UPDATE: HB 864 has not been assigned to a committee as of today. SO far we have put the “brakes” on this legislation. Please stay tuned as the target is on us.

HB 864 is a bill targeting educator pensions. Creating an “OPTION for all educators to get into a 401(k) plan. This is targeted to NEW HIRES. This is Sinquefield/Show Me Institute model legislation Introduced by none other than my own Representative Jered Taylor of Nixa. The PSRS/PEERS Systems are having the actuaries look at the bill. There will be more information out soon on the affects to our pension system. I am very sure the expense to the system will be enormous. To put it simply: No money, no pensions. HB 864 will take away employee and employer contributions (currently 29% of payroll) from the system by allowing educators to OPT OUT the current system and into a 401(k). This will lower the amount of dollars for investment. Currently, 61 cents of every dollar paid to retirees comes from investment returns. Representative Taylor is using Show-Me Institute talking points and therefore is misinformed on how a Defined Benefits plan works. HB 864 is an attack on public education and educators.

This Legislation if passed WILL:

• Eventually bankrupt our system. The system would run out of money in about 25 years. Fewer contributions will be paid into the system for investments which are needed to pay benefits. The average retiree uses the amount they contributed in less than 6 years!!
• Immediately eliminate any future COLAs.
• Likely result in benefit reductions by possibly 25% or more for current retirees.
• Cause drastic increases in the contribution percentage paid by active vested educators Currently, they are paying 14.5%. This will be necessary to try to stretch benefits into the future. How much will active educators be willing to pay?
• MORE TO COME as we study the legislation and get input from the PSRS/PEERS system and the actuaries.

COMMENT: MRTA strongly opposes HB 864 as it threatens pension benefits educators have worked so hard for. 401(k)s have been described as a “failed experiment.” Only 40% of Americans have any retirement savings. 401(k)s are at the mercy of the stock market. Do you feel lucky?! 401(k)s can be raided by individuals as life creates needs for cash. To be simply put 401(k)s do NOT offer retirement security. Our pension plan does! Our defined benefit system pays you until you pass. Now that is retirement security! But it takes everyone to participate. HB 864 is designed to divide and conquer us!

OUR job is to convince our own Missouri State Represenative and State Senator to oppose the bill. Ask them to VOTE NO! HB 864 threatens our pension system and our pension benefits. Just leave us alone!

Please see recent articles regarding HB 864 and Representative Taylor:
Springfield News Leader Article Jered Taylor Comments – Feb. 15, 2019
Springfield News Leader Article Jered Taylor Comments – March 20, 2019

Great job so far, MRTA! Please remember, MUCH can happen before Session ends on May 17th. Please stay tuned, check your e-mail often, and please act on any CALL TO ACTION from your MRTA. We are here 24/7 to be YOUR PENSION WATCHDOG!

PRIORITY #1 – MRTA opposes HB 864 (Taylor Rep. – 139) Establishes a new retirement option for certain teachers in Missouri.

Click here for a report and talking points on HB 864.

• Halftime Report – This bill has not been assigned to a committee as of March 28th. We have “put the brakes” on this legislation. GOOD JOB, MRTA!

PRIORITY #2 – MRTA supports HB 723 (Pike Rep.– 126) This legislation is an MRTA priority and allows pension benefits to “POP UP” after a divorce with the ruling on assets by a court.

HB 723 makes this provision retroactive for those divorced prior to Sept. 1, 2017. This bill is similar to HB 304 of 2017.

• Halftime Report – Voted Do Pass Out of Committee. Awaiting floor debate

PRIORITY #3 – MRTA supports HB 77 (Black Rep.-7), SB 17 (Romine Rep.-3.) Exempts any person retired or receiving allowance from PSRS and employed by a public community college from current law related to working-after-retirement (W.A.R.) provisions.

• Halftime Report – HB 77 will likely become law soon. Passed the House by consent and Senate Committee. Awaiting final vote of the Senate.

PRIORITY #4 – MRTA supports HB 69 (Dinkins Rep.-144). This legislation re-establishes the 2.55 factor for those working 31 years or longer.

This legislation has a positive financial effect on the PSRS system. The longer one works the fewer benefits that will be paid as one gets closer to death.

• Halftime Report – No action.

PRIORITY #5 – MRTA supports full funding of the Foundation Formula and opposes the use of public tax dollars for private schools.

The Missouri Constitution mandates adequate funding of K-12 education through HB 2 which requires education funding as the second priority of state expenditures. Comment: Due to several tax cuts enacted by the legislature over the past few years general revenue is expected to be reduced significantly. MRTA asks funding for Public Education be the #1 priority.

• Halftime Report – Budget debate by the House this week. The House has proposed fully funding the Foundation Formula – a $62 million increase! GOOD JOB, MRTA!

PRIORITY #6 – MRTA supports SB 78 (Sater Rep.-29) This legislation would restore to over 60,000 elderly Missourians state assistance for prescription drugs.

Many older MRTA members are at minimum retirement benefit and many are not eligible for Medicare. This legislation would be of great help to their quality of life.

• Halftime Report – On Senate Calendar for debate and vote.

PRIORITY #7 – MRTA opposes SB 160 (Koenig Rep.-13). This act establishes the Missouri Empowerment Scholarship Accounts Program.

Comment: These are voucher schemes which create a new 100% tax credit allowing up to $25 million per year of state revenue to be used for private school tuition and other expenses for students. This will result in up to $25 million less state revenue for public education per year. These bills take scarce tax revenue away from public education.

• Halftime Report – On Senate Calendar for debate and vote. Stalled at this time due to lack of votes and filibuster. GOOD JOB, MRTA!

PRIORITY #8 – MRTA opposes HCS/HB 581 (Roeber Rep. 34) and SCS/SB 292 (Eigel Rep. – 23).

Charter School Expansion – This bill would allow charter schools outside entities and operate in districts around the state. Charter schools are not subject to the same standards of accountability as public schools. Comment: Charter schools take scarce tax revenue from public education. Currently, charter schools are only allowed in St. Louis and Kansas City.

• Halftime Report – On House Calendar for debate and vote. Stalled at this time due to lack of votes. GOOD JOB, MRTA!

PRIORITY #9 – MRTA supports and asks for legislation to allow a Cost of Living Adjustment for St. Louis City and Kansas City retired educators.

Currently, St. Louis City retired educators have not had a COLA since 2006. Their spending power has been significantly reduced. COLAs are essential to the quality of life of education retirees.

• Halftime Report – No action.

Married couples with Missouri adjusted gross income less than $100,000 and single individuals with Missouri adjusted gross income less than $85,000, may deduct up to 100% of their public retirement benefits, to the extent the amounts are included in their federal adjusted gross income.  Click here for MO-A form.

• The total public pension exemption was limited to $37,720 for each spouse for the 2018 tax year.
• Married couples with Missouri adjusted gross income greater than $100,000 and single individuals with Missouri adjusted gross income greater than $85,000, may qualify for a partial exemption.
• There is no age requirement for eligibility.

Health Insurance Premiums may be deductible too. Click here for more.

Visit www.dor.mo.gov for more information regarding eligibility. Or you may contact the Missouri Department of Revenue at (573) 751-3505, email income@dor.mo.gov or consult a tax professional for more information.