Benefit Replacement Pay for State Agencies
(Other Than Institutions of Higher Education)
Other Considerations and Calculating Maximums for Lump-Sum Payrolls

Other Considerations for BRP

• BRP is part of wages for both FICA and retirement purposes and therefore deductions for each must be made from BRP.
• BRP is included in reportable wages for the Texas Workforce Commission (TWC), based on guidance provided to the Comptroller’s office by TWC.
• The BRP limitation is based on the retirement system participated in by the BRP-eligible employee. If an eligible employee transfers from a job under one retirement system to another, the maximum for the current retirement system will apply.

Calculating Maximum BRP for Lump-Sum Payrolls

The maximum BRP payable on a lump-sum payroll for employees who do not level is .062134891 times the lump-sum payment subject to the following maximum:

[1 – (YTD BRP/Max BRP)] x $965.25 = Maximum BRP for lump-sum payroll

YTD BRP = Year-to-date BRP paid to the employee
Max BRP = Maximum BRP allowed by the applicable retirement system

Example: The maximum BRP on a lump-sum payment for a member of the Employees Retirement System (ERS) who has received $740 in year-to-date BRP at the time of his or her lump-sum payment is calculated as follows:

[1 – (YTDBRP/Max ERS BRP)] x $965.25 =
[1 – ($740/1,026.86)] x $965.25 =
[1 – .72064351518] x $965.25 =
.27935648482 x $965.25 = $269.65

Assuming the employee’s lump-sum payment was $3,500, the employee’s BRP would be:
.062134891 x $3,500 = $217.47

For a lump-sum payment of $7,500, the initial calculation would yield a BRP that exceeds the maximum BRP allowed (.062134891 x $7,500 = $466.01). In this case, the employee’s BRP would be $269.65, the maximum BRP the employee is eligible for according to the formula above.

Source

Texas Government Code, Sections 606.061(3), 659.121, 659.123, 659.125, 659.126, 659.127, 811.001(7).