All school employees must contribute to a retirement plan of some type but substitute teachers, part-time employees, and summer workers do not qualify for the Texas Teacher Retirement System (TRS). Traditionally that meant that the district and the employee both had to contribute 6.25% (12.5% total) to social security. Unfortunately because their pay was so low and the corresponding contributions low they often see no benefit in future social security payments, if they even receive one.
The FICA Alternative Plan from Region 10 RAMS provides a solution that aids both school districts and employees who are not eligible for TRS. The contributions are invested through a trust account and at the end of the employee’s service with the district he/she is eligible to receive a lump sum of his/her entire account balance. The district benefits because the law requires a 7.5% contributions which can be deducted from the employee’s pay meaning that the district saves the 6.25% it would have paid into social security.
As of March 31, 2023, the Region 10 RAMS FICA Alternative Plan held $285.9 million for 456,213 employees in 186 entities.
Chief Human Resources Officer