I have included the above information. I will follow with further information regarding an increase in our monthly retirement checks.
LAP Legislative Advocate
2016 LOUISIANA STATE LEGISLATIVE UPDATE 4.4.16
SENATE RETIREMENT COMMITTEE MEETING 1:00 P.M.
SB2 by Senator Barrow Peacock
RETIREMENT SYSTEMS: Authorizes payments funded by state systems' experience accounts to certain retirees and beneficiaries. (2/3 - CA10s29(F)) (6/30/16) (OR INCREASE APV)
Present law designates the following as state retirement systems: (1) La. State Employees' Retirement System (LASERS) (2) Teachers' Retirement System of La. (TRSL or Teachers) (3) La. School Employees' Retirement System (LSERS) (4) State Police Retirement System (SPRS or Troopers)
Present law, relative to the four state retirement systems, establishes an "experience account" within each system for the accumulation of certain system funds. Provides for utilization of these funds for benefit increases, commonly called "cost-of-living adjustments" (COLAs), for retirees, survivors, and beneficiaries of the system. Provides that the following classes of retirees and beneficiaries are eligible for a COLA paid pursuant to present law: (1) Any regular retiree who has received a benefit for at least one year and who has attained at least age 60. (2) Anybeneficiaryof a regular retiree if the retiree, beneficiary, or both combined have received a benefit for at least one year and if the deceased member would have attained age 60. (3) Any disability retiree or any beneficiary who receives benefits based on the death of a disability retiree if benefits have been received by the retiree, beneficiary, or both combined for at least one year. Proposed law retains present law. Proposed law authorizes each state system board of trustees to grant a COLA, payable July 1, 2016, to the retirees and beneficiaries who would qualify for a COLA under present law. Uses the funds from the experience account to fund the COLA. Present law provides the maximum amount of a COLA based on the consumer price index and the systems' funded ratio. Without regard to the consumer price index, proposed law provides that the amount of the COLA shall be an amount supported by the funds in the system's experience account, after all required credits and debits to the account under present law. Proposed law provides that, in accordance with the funded ratio of each system, the maximum amount payable shall be 1.5% of the benefit subject to the increase for LASERS and Teachers' and shall be 2% of the benefit subject to the increase for LSERS and Troopers'.Proposed law provides that the benefit increase shall be paid only on the first $60,000 of a retiree or beneficiary's benefit. Proposed law provides that any cost of proposed law not funded by payments made from the system experience account shall be funded with additional employer contributions in compliance with present law Article X, Section 29(F) of the Constitution of Louisiana. Proposed law provides that if the instrument which originated as SLS 16RS-1 of the 2016 Regular Session of the Legislature does not become effective, proposed law shall be null and void and of no effect. Effective June 30, 2016. (Adds R.S. 11:542.2, 883.4, 1145.3, and 1332.1)
SB18 by Senator Barrow Peacock
RETIREMENT SYSTEMS: Provides for actuarial determinations and application of funds. (6/30/16) (OR DECREASE APV)
Proposed law generally rearranges the content of present law to provide for ease of administration and clarification of certain actuarial concepts. Proposed law contains a few substantive changes, as further detailed in this digest. Unless otherwise indicated, the provisions of present law and proposed law apply to all four state retirement systems: (1) La. State Employees' Retirement System (LASERS) (2) Teachers' Retirement System of La. (Teachers' or TRSL) (3) La. School Employees' Retirement System (LSERS) (4) State Police Retirement System (Troopers) OVERVIEW Present law, relative to state retirement systems, generally provides for determination of actuarial liabilities and calculations of payments to liquidate those liabilities. Provides for application of certain actuarial gains to help reduce the payments necessary to liquidate a system's liabilities, to reduce specific amortization bases of system debt, and for allocation to a side account (the experience account) designed to accumulate monies to fund benefit increases for retirees.
SUBSTANTIVE CHANGES Present law, subject to certain caveats, provides for a schedule of maximum PBI amounts based on a system's funded level. The schedule ranges from a minimum of 1.5% for a system that is at least 55% funded but less than 65% funded to a maximum of 3.0% for a system that is at least 80% funded. Proposed law retains present law. Proposed law, for purposes of determining the maximum PBI within the schedule in present law, specifies that the funding level shall be determined before any allocation to the experience account. Proposed law provides that effective for the June 30, 2016 system valuation the amortization period for most actuarial changes, gains, and losses shall be reduced from 30 years to 20 years in two-year increments over the next five years. Further provides that in the first system valuation following June 30, 2015, in which an allocation is made to the system's experience account and for each valuation thereafter, actuarial gains allocated
Proposed law retains present law and consolidates all K-12 employee groups at Teachers' into a single plan for rate purposes. Present law, relative to LASERS and Teachers', provides for special amortization bases called the original amortization base (OAB) and the experience account amortization base (EAAB). Provides for increasing payment schedules for these debts. Provides for application of annual "hurdle" payments, from investment earnings above a certain target, to extinguish these debts. Proposed law retains present law and provides for reamortization of the debt payments when moving to level-dollar payments results in annual payments that are not more than the next annual payment otherwise required under present law without extending the payment period. Proposed law further provides for reamortization of the debt payments in the June 30, 2016 valuation and in every valuation in which the year is equal to 2016 plus a multiple of five. Proposed law prescribes the order in which credits and debits are to be made to the experience account. Requires credits (or debits) related to the net investment gain (or loss) attributable to the balance in the experience account during the prior year be made first. Next any credits pursuant to present law allocation of investment experience gains are applied. Lastly, if a COLA is paid, the debit for such COLA cost shall be made to the account.