Sept 17-18, 2026 | Board Summary

TRS-Care Fund – A Strategic Opportunity

Trustees reviewed a reserve policy and a proposed investment framework for the TRS-Care Fund. Each year, the board will review near-term cash needs for retiree medical claims, and the TRS’ Investment Management Division will invest the remaining TRS-Care Fund balance to support long-term needs. In a conservative scenario, IMD projects about $90 million in first-year returns, or 1.4% more than a cash-only portfolio.

“The intent here is to pursue an enhanced return,” Chief Health Care Officer Meaghan Bludau told trustees. “But the statutory payroll-based funding is the majority. And that is needed to ensure the (program’s) long-term stability.” Along with money from the state, school districts and active members all contribute to TRS-Care and retirees in the form of premiums.

Why bring the TRS-Care fund in-house?

The TRS-Care fund assets are currently invested by the Office of the Comptroller and earn a cash rate of return. Since legislative changes made in 2018, recent federal Medicare changes and TRS’ careful plan management, the TRS-Care fund is experiencing a growing balance. This presents an opportunity to bring management of the fund in-house at IMD, and the potential for enhanced returns by investing in assets other than cash. See the Reserve Policy slides (board book page 36) and the proposed investment framework (board book page 58).

December’s meeting is expected to bring a recommendation for adoption of the proposed TRS-Care Fund Reserve Policy.

Deputy Director’s Report

Trustees received updates on the status of TRS’ regional offices. The new location for the TRS El Paso Regional Office has been chosen and will tentatively open early in 2028 (see page 111 of the board book). The current El Paso office opened in 2022. The future TRS Rio Grande Valley Regional Office shares the 2028 timeline for its opening. Lease and construction timeline are currently being finalized. 

The Chief Communications Officer presented the annual update on Member & Employer Outreach Plan activities. Read the presentation from page 118 of the board book on how TRS is meeting and communicating with our members where they are. One good example of that: the new TRS podcast, TRS Afterschool Special, and our AI content strategies. 

Benefits Update

The Chief Health Care Officer shared program updates. TRS-ActiveCare: largest recent employer growth (25 new employers, including 14 that are reentering early). TRS-Care: TRS-Care Medicare Advantage premium reduction of ~27% for plan year 2027 (see more on the position of the TRS-Care Fund in What Else the Board Discussed).

Benefits Update Board Book  

The Health team also provided a spotlight on its Health Operations group including a focus on the success of the web self-service options for enrollment in programs like TRS Dental & Vision and TRS-Care Standard and Medicare Advantage. A reminder that the limited-time enrollment period for TRS-Care Medicare Advantage begins in October.

Investment Management Update (IMD)

TRS’ Chief Investment Officer shared positive news of a 16.5% one-year return for the second quarter. That includes a large amount of excess return, 1.46%. Compare annual fund performance with the board’s 7% annualized assumed rate of return goal. Overall, the June 30 value of the pension fund was $252.3 billion. The fund was up $18.8 billion from the first quarter.

Investment Management Committee (IMC) Board Book