HLS 10RS-740 ORIGINAL
Page 1 of 3
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Regular Session, 2010
HOUSE BILL NO. 516
BY REPRESENTATIVE ARNOLD
RETIREMENT/STATE SYSTEMS: Makes permanent certain requirements that state
retirement systems direct portions of certain types of investments through La.
broker-dealers
AN ACT1
To amend and reenact R.S. 11:266.1(D) and to repeal R.S. 11:266.1(E), relative to the2
investments of state retirement systems; to make permanent certain provisions3
requiring investments through Louisiana incorporated and domiciled broker-dealers4
or dealers with their principal trading operations in Louisiana; to provide an effective5
date; and to provide for related matters.6
Notice of intention to introduce this Act has been published7
as provided by Article X, Section 29(C) of the Constitution8
of Louisiana.9
Be it enacted by the Legislature of Louisiana:10
Section 1. R.S. 11:266.1(D) is hereby amended and reenacted to read as follows: 11
ยง266.1. Investment through Louisiana incorporated and domiciled broker-dealer12
* * *13
D. The provisions of Subsections A, B, C, and D of this Section shall be14
implemented as a temporary pilot program and shall be null, void, and of no effect15
after June 30, 2010. An interim cost analysis of the provisions of this Section shall16
be performed by the systems and shall be presented to the speaker of the House of17
Representatives, the president of the Senate, the chairmen of the House of18
Representatives and Senate committees on retirement, the Public Retirement19 HLS 10RS-740 ORIGINAL
HB NO. 516
Page 2 of 3
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Systems' Actuarial Committee, and the Commission on Public Retirement at least1
fourteen days before the convening of the regular legislative session in 2007, and2
again at least fourteen days before the convening of the regular legislative session3
in 2010.4
E. Each system to which this Section applies shall submit to the House and5
Senate committees on retirement quarterly and annual progress reports detailing the6
system's investments which comport with the provisions of this Section. Such7
reports shall continue notwithstanding the June 30, 2010, expiration of Subsections8
A, B, C, and D of this Section and shall be submitted as follows:9
(1) An annual report for the year ending June 30, 2004, to be submitted on10
or before July 30, 2004.11
(2) Quarterly reports beginning with the quarter ending September 30, 2004,12
to be submitted no more than thirty days after the end of the quarter.13
(3) Annual reports beginning with the year ending June 30, 2005, to be14
submitted no more than thirty days after the end of the year.15
Section 2. R.S. 11:266.1(E) is hereby repealed in its entirety.16
Section 3. This Act shall become effective on July 1, 2010; if vetoed by the governor17
and subsequently approved by the legislature, this Act shall become effective on July 1,18
2010, or on the day following such approval by the legislature, whichever is later.19
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Arnold HB No. 516
Abstract: Removes a termination date on requirement that the La. State Employees'
Retirement System (LASERS), the Teachers' Retirement System of La. (TRSL), the
La. School Employees' Retirement System (LSERS), and the State Police Pension
and Retirement System (LSPRS) direct 10% of commissions on certain domestic
equity trades and 10% of certain fixed-income trades through certain La. broker-
dealers.
Present law (R.S. 11:266.1(B)) requires that each of the four state retirement systems
(LASERS, TRSL, LSERS, LSPRS) direct at least 10% of the commissions on all trades of
domestic equities in separately, actively managed portfolios through broker-dealers who are
selected on a best bid and offer basis and who have been incorporated and domiciled in La. HLS 10RS-740 ORIGINAL
HB NO. 516
Page 3 of 3
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
for at least two years or who have had their principal trading operations in La. for at least
two years and who are registered and in good standing with the National Association of
Securities Dealers, and who have demonstrated the ability to execute institutional domestic
equity and fixed-income transactions. Present law further requires each such system to
direct 10% of all trades of domestic investment grade fixed-income investments in
separately managed accounts through such broker-dealers selected on a best bid and offer
basis.
Present law (R.S. 11:266.1(B)) requires these broker-dealers to negotiate commission
recapture agreements with the systems. Provides that the commissions recaptured under any
such agreement shall not be a majority of the total value of the commissions required to be
directed to the broker-dealers under present law.
Present law (R.S. 11:266.1(C)) specifies that all trades shall be subject to best efforts and
best executions as defined by the Securities and Exchange Commission and the National
Association of Securities Dealers.
Present law (R.S. 11:266.1(D)) provides that the provisions of present law, except for the
reporting requirement, shall be implemented as a temporary pilot program until June 30,
2010. Specifies that each system shall perform an interim cost analysis of the provisions of
present law which shall be presented to the speaker of the House of Representatives, the
president of the Senate, the chairmen of the House of Representatives and Senate committees
on retirement, the Public Retirement Systems' Actuarial Committee, and the Commission
on Public Retirement at least 14 days before the convening of the 2010 R.S.
Proposed law repeals the pilot program termination date of June 30, 2010, and extends the
requirements of present law indefinitely. Proposed law further repeals the requirements for
an interim cost analysis by the systems.
Present law (R.S. 11:266.1(E)) requires each system to submit to the House and Senate
committees on retirement quarterly and annual progress reports detailing the system's
investments which comport with the provisions of present law. Provides that the reports
shall be submitted as follows:
(1)An annual report for the year ending June 30, 2004, to be submitted on or before July
30, 2004.
(2)Quarterly reports beginning with the quarter ending Sept. 30, 2004, to be submitted
no more than 30 days after the end of the quarter.
(3)Annual reports beginning with the year ending June 30, 2005, to be submitted no
more than 30 days after the end of the year.
Proposed law retains the reporting requirements of present law.
Effective July 1, 2010.
(Amends R.S. 11:266.1(D); Repeals R.S. 11:266.1(E))