In 1997, the Texas Legislature added the Deferred Retirement Option Plan (DROP) as
an option under the Texas Teachers Retirement System (TRS). TRS members who are eligible
to retire and receive a standard TRS retirement annuity, and who have at least 25
years of service credit in the TRS, may elect to participate in the DROP while employment
continues. The period of participation is a minimum of 12 months and a maximum of
60 months. The filing of an election to participate in the DROP is not considered
an application for retirement.
DROP participants remain members of TRS but do not accrue additional service credit
toward their standard TRS annuity while participating in DROP. During participation
in the DROP, the employee and the employer continue to pay contributions to the TRS.
Participation in the DROP plan ends when the employee retires or dies, or when the
term of the DROP expires. Upon retirement, TRS members are entitled to their standard
TRS annuity, in addition to the amount in the DROP account, plus interest. DROP funds
may be taken as a lump sum or in periodic installments.