Budget & Taxes (Pensions)

This bill modifies the Teachers' Retirement System to provide a longevity bonus to certain retirees and their beneficiaries. The key provision establishes that eligible individuals receiving monthly allowances from the system on or before September 30, 2026, will receive an additional bonus payment. The legislation also requires funding to be appropriated to the Teachers' Retirement System to cover these bonus payments. This change directly affects teachers and other public employees who are already retired and drawing benefits from the system. The bill is currently under consideration by the Senate Committee on Finance and Taxation Education.

SB 315 provides a 2% cost-of-living benefit increase for certain Alabama retirees and beneficiaries of the Employees' and Teachers' Retirement Systems, effective October 1, 2026. It applies to retirees who retired before October 1, 2025, and are currently receiving benefits, with a minimum $15 monthly increase. The increase requires annual legislative appropriation and depends on employer participation for specific retirement plans; beneficiaries of deceased retirees also qualify under the same terms. Retirees receiving Medicaid benefits may be excluded if the increase would impair their Medicaid eligibility.

HB 339 would provide a 4% cost-of-living increase to certain Alabama Teachers' Retirement System retirees and their beneficiaries, effective October 1, 2026. It directly affects retirees who retired before October 1, 2025, have 25+ years of service, and receive $25,000 or less annually in benefits, as well as surviving spouses of retirees meeting similar criteria. The increase is subject to legislative funding approval each year and would not apply to individuals whose Medicaid eligibility would be impaired by the higher benefit. This change requires separate annual appropriations to fund the increase, with payments resuming only if the required funding is included in the Education Trust Fund budget.

HB 338 would provide a 4% cost-of-living increase (minimum $15 monthly) for state and local retirees and beneficiaries under Alabama's Employees' Retirement System who retired before October 1, 2025. This applies to retirees from most state/local employers, excluding those whose employers participated under specific sections (36-27-6, 7, or 7.1) unless those employers elect to participate. The increase is subject to legislative appropriation, and Medicaid recipients whose eligibility would be impaired by the increase are excluded. Funding would be distributed from employer contributions based on active member salaries.