friendly hitchhikers added to an effort to boost the monthly pension checks of
retired state employees and teachers should help ensure the bill’s passage, the
legislation’s sponsor said Monday.
Senate Retirement Committee amended House Bill 42, then agreed to the proposed
1.5 percent cost-of-living adjustment, or COLA, for about 135,000 retirees.
measure now heads to the Senate floor for debate. If approved there, it would
return to the House for concurrence in Senate changes.
feel really good about it,” said Rep. Sam Jones, D-Franklin, who is sponsoring
HB42. “It’s an easier task to carry this back.”
argued that retirees needed a pension increase this year because health care
costs had more than eaten up last year’s average monthly benefits increase of
less than $30 a month. The pension adjustment proposed by Jones would add
another $30 per month to the average retiree’s check.
Senate panel added some provisions aimed at shoring up the finances of the four
statewide retirement systems to which the retirees belong. The two largest —
teachers and state employees — have a combined $19 billion in long-term
an incredible balancing act,” committee chairman Sen. Elbert Guillory said.
“It’s a balancing of the idea and inclination of legislators who want to grant
a COLA and other concerns about the long-term impact on the system.
guess you can call this a Christmas bill. There’s a little something for
everybody in it,” the Opelousas Republican said.
House approved the COLA measure on an 80-20 vote last week with opponents
citing concerns over the pension systems finances. The same opposition initially
bottled it up in committee, refusing to advance the bill.
COLA covers retirees of the four statewide pension systems — state employees,
teachers, school employees and State Police.
new provisions would put more money into the retirement systems to more quickly
to pay down what are called unfunded accrued liabilities, or UAL — the dollars
needed to fulfill all the pension obligations to retired and current members.
Instead of debts being paid off over 30 years, the period would gradually be
reduced to 20 years by the year 2020.
will make our system a whole lot more actuarially sound,” Sen. Barrow Peacock,
change would help control the cost of employer contributions, which both state
government and local school boards have been struggling to pay.
shores up some funding and will cause accelerated funding of the retirement
system reducing the interest payments,” Legislative Actuary Paul Richmond told
retirees got a COLA last year and were not supposed to receive one this year
under a new law. Under the
2014 law, more of the retirement systems’ excess investment earnings
will go toward reduction of long-term debts before dollars are put into the
special COLA accounts.
changes limited both the frequency and amount of future retiree benefit hikes
until systems hit certain unfunded accrued liability levels.
Senate committee adopted amendments allowing the 1.5 percent COLA for all
groups as well as the potential for up to 2 percent for school employees and
State Police if funds were available. School employees and State Police have
hit the benchmark for a potential 2 percent COLA.
the panel said there would be no adjustment in the following year because no
money would be deposited in the special accounts from which COLAs are paid.
system officials had earlier testified that the $350 million to cover the
long-term expense of a 1.5 percent permanent benefit adjustment was available.
COLA would average $26 a month for state employee retirees and $28.72 for
have provided a belt and suspenders ... granting a COLA but also improving the
financial soundness of the system,” said Cindy Rougeou, executive director of
the Louisiana State Employees Retirement System, better known as LASERS.
don’t see anything that would have great concerns for us,” Teachers Retirement
System of Louisiana Executive Director Maureen Westgard said of the changes.
State Employees Association lobbyist Frank Jobert called the changes “a fair
trade-off to accelerate the COLA this year and forgo next.”