The Senate Committee on Retirement today approved a bill that would tighten requirements for public employee members of four state retirement systems. HB 1337 by Lafayette Representative Joel Robideaux has already been approved by the House. “This wasn’t just something I came up with to aggravate the systems or retirees,” Representative Robideaux told committee members, “this was my effort to try and save the defined benefit plan.” Backers claim the measure will save the state money in the face of financial markets that have recently been troubled by volatile returns. The changes include a five year final compensation calculation, instead of the three years included in the Teachers’ Retirement System of Louisiana (TRSL), the State Police Retirement System, and the Louisiana School Employees System (LSERS).
Since 2006, as a result of Act 75 of 2005, new rank and file members of the Louisiana State Employees’ Retirement System (LASERS) are already subject to the restrictions. If the bill receives final approval from the legislature, and is signed by Governor Jindal, it would go into effect for new employees hired on or after January 1, 2011. The proposal was offered as an alternative when supporters failed to get the votes need to shift new employees into a 401(k) styled defined contribution plan instead of the current defined benefit program.
The panel also OK’d HB 189 by Thibodaux Representative Dee Richard which provides for early retirement for members of LASERS who are at least 50 years of age, and have 10 years of service credit. A member who retires under this provision would receive an actuarially reduced benefit. It would effective from July 1, 2010 to July 1, 2013. Representative Richard said the goal of the legislation is to permanently reduce the number of state employees. Governor Jindal vetoed a similar measure last year.