Bush, Enron and the Teacher Retirement system of Texas?

[Reciprocity]

Hi all, my husband after 26 years of struggling with Crohn's disease and numerous operations, had to take a medical retirement from teaching. Crohns is a chronic inflammatory disease of the intestines. Because the Teacher retirement system of Texas was heavily invested in Enron, after 27 years of teaching with a masters degree, he is only receiving $ 905.00 take home, after September this will be reduced to $805.00 take home. He suspects that former Governor Bush influenced the heavy investment of so much teacher retirement funds into Kenny Boys Enron. If that is so every teacher in Texas should be pissed off. The ironic thing is they will still vote for him...I guess most teachers enjoy getting screwed.

For some reason the media gloms onto the misfortunate employees of Enron and not the domino effect that this crime has had on others. Not only does it hurt Enron employees it affect pensions.


Loss of $36 million to Enron by Texas Teacher Retirement Fund deserves investigation
<snip>
The loss of $35.7 million by Texas Teacher Retirement System in the collapse of Enron affects more than current and retired teachers and staff. Money lost from state pension funds comes from public school employees, college employees, and ultimately from all Texas taxpayers because state funds match employee contributions. Texas teacher and taxpayer monies flowed into Enron this fall when TRS made a series of stock purchases in October and November. Shortly thereafter, Enron awarded huge bonuses to top officials just before declaring bankruptcy. Of all the Texas agencies, TRS had the largest loss

<snip>
Is it possible that Texas retirement funds were being used in an attempt to shore up a failing Texas company which had donated heavily to state officeholders charged with overseeing Enron? Why did TRS buy risky stock three times after it was known that Enron was in serious trouble? The people of Texas have a right to know.

http://www.enronownsthegop.com/news/trs.htm

[xray s]

1. also check Florida

I think the public employee retirement funds got the shaft there too.

[teach1st]

2. Florida retirement was invested in Enron

Florida and Texas weren't alone

http://www.afscmefl.org/enron.html

According to a report by AFSCME Florida Council 79, Inside the Florida State Board of Administration: Mismanagement Made the Enron Loss Inevitable, the State Board of Administration (SBA) repeatedly engaged in poor investment practices under the watch of its Board of Trustees, chaired by Gov. Jeb Bush. Despite warnings from inside and outside the SBA, the trustees failed to correct these problems, leading to a stunning loss on Enron stock nearly three times greater than that of any other state retirement fund. The trustees failed to act as Alliance Capital Management, one of the pension fund's money managers, continued to invest in Enron even as its financial instability became public and the Securities and Exchange Commission was investigating the corporation.


http://www.whoseflorida.com/pension_fund.htm

$335 million worth of bad investments


http://www.southcoasttoday.com/daily/01-02/01-19-02/a02wn013.htm

With the Enron collapse wiping out at least $1 billion from the retirement funds of teachers, firefighters and other public employees, states are joining a class-action lawsuit to win back some money from the once-giant energy trading company.

Several other states are examining their ties to accounting firm Arthur Andersen, or weighing legal action against it. Florida has already filed subpoenas for a potential civil lawsuit.

"We owe it to these public servants to get back as much of their money as we possibly can," Ohio Attorney General Betty Montgomery said. The retirement plans invested in Enron stock, once the darling of Wall Street before the company acknowledged it overstated profits and then went bankrupt.

The retirement of individual public employees -- and the funds' financial stability -- are not in danger, according to the directors of retirement funds in several states. Losses in each state accounted for just a fraction of a percent of each retirement fund's value.

Attorneys general in Georgia, Ohio and Washington state have asked a federal court in Texas to make them the lead plaintiffs in existing investors' securities fraud litigation. Others seeking to lead the class-action suit include agencies overseeing pension funds in Florida and New York City, and the university pension fund in California.

[Reciprocity]

3. Why the hell isn’t the media reporting this?

We could qualify for food stamps!!! George and Jeb should be proud.

[Meritaten1]

4. Maybe you should bring this story to the media's attention?

Perhaps newspapers in states with teachers who have been damaged by this situation might find the story worthy of further investigation.

[Reciprocity]

5. The media here is useless.

We live in Bible belt of East Texas. Looks like I will have to wait for the DVD to see Fahrenheit 911 as its not going to be shown here ~sigh. Can you believe that they moved Harry Potter from the mall to a run-down theater in a mostly abandon strip mall. This gets better it had only one showing at 10:00 PM! I sometimes feel like I live in a theocracy.

[Meritaten1]

6. The mainstream media has really deteriorated

It has probably been going on for a long time, but I only noticed after the 2000 election. It is depressing.

[Yupster]

7. The formula for the TRS system is

years experience X 2.3 = % pay (best 3 year average)

It doesn't have anything to do with what investments the TRS is invested in. That is the same formula that has been used for a decade or more.

This is assuming he has his 80 points. (it was 85 until a few years ago). If he does not have his 80 points, his pension is reduced for early retirement, not for investment losses.

For example, if a teacher is 54 with 26 years experience, and his best three year average was $43 k, his formula would be...
26 x 2.3 = 59.8 %

59.8 % of $43k = $ 25,714 or $ 2,143 per month.

If he's getting $ 900 per month, then something is far different from my "typical formula."

Was he a part-time teacher who never made close to $43k?

Did he take some of his years out of the system years ago and not buy them back?

Is he having lots deducted from his gross check to result in a small net? Maybe TRS Care premiums for the whole family, TRS long-term care premiums? Is he having lots extra withheld for the IRS to compensate for taking out investment money without any withholding?

I'd have to know more about your family for a better explanation, but something is happening atypical of a retiring teacher with 26 years in if he is getting $ 900 per month.

PS - What would happen if because of bad investments, the TRS could not pay out its committed benefits?

Two things would be likely.

1. The state legislature would pump money into the system.
2. Existing teachers would have their TRS deductions raised to cover the shortfall.

[Reciprocity]

8. Health insurance is were they get you.

$30,044.72 = $2,503.73 then they take out taxes.

They have reduced the employers part. Our part is $550.00 a month. This September will be the second raise in premiums in one year.

[Yupster]

11. That's only if you have extra

people on it right?

For just the retired person, even the top level of TRS Care just costs $ 140 per month if I'm remembering right.

[UTUSN]

9. Separate from the TRS, the ERS (State employees) of TX

lost $24 mil in the Enron takedown.

[Yupster]

10. Giant pension funds like TRS and ERS

probably own stock in every one of the stocks in the S+P 500, and their bonds too.

When a system has that much money to invest, it gets spread into every single thing.