The House Retirement Committee Thursday narrowly approved legislation that changes benefit programs for future members of the four public retirement systems.
If HB 1337 by Lafayette Representative Joel Robideaux makes it through the process, employees in the LASERS system hired after Jan. 1, 2011, would go into two types of retirement systems: hazardous duty and all others.
The biggest change is that their final average compensation, the amount on which retirement benefits are based, would be calculated on five years, instead of three. To draw the first retirement check, the employees who are not in hazardous duty would have to reach age 60. Supporters believe that the measure would save the state money in the future and slow the growth of systems’ debt.
“I don’t think if you look at retirement systems in general,” said Representative Robideaux, “that 60 in today’s work life is unreasonable.”
Employees would still earn benefits that would qualify them for partial pay after 20 years.
The vote on HB 1337 came after House Speaker Jim Tucker voluntarily deferred HB 930, that would have shifted all new employees in state retirement systems to a 401(K) styled defined contribution plan, instead of the current defined benefit plan. The request by the Speaker came after staff actuary Paul Richmond testified that a study of the bill showed that the change would make employees responsible ”for the investment of their retirement funds" so that in the end, “we may see people running out of money before they run out of life.” The LASERS Board of Trustees voted to strongly oppose the change.
The Committee approved HB 189 by Rep. Richard which would allow LASERS members to retire at age 50 with 10 years of service, with a reduced benefit.
House Bill 73 by Rep. Ligi, which would have required forfeiture of benefits by certain convicted felons was deferred, meaning that it will not be given further consideration during this session.
The panel was expected to hear HB 1229, which calls for the consolidation of the investments of the state’s four retirement systems, and the creation of a nine member commission to administer the combined investment program. The systems involved, the Louisiana State Employees’ Retirement System (LASERS), the Teachers’ Retirement System of Louisiana (TRSL), the Louisiana School Employees’ Retirement System (LSERS) and the State Police Retirement System all oppose the shift. Representative Page Cortez announced to the committee as the panel’s session drew to a close that the Speaker had been called away by an emergency. That measure could be rescheduled.