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Regular Session, 2010
SENATE BILL NO. 14
BY SENATOR APPEL
RETIREMENT BENEFITS. Provides relative to the Louisiana State Employees' Retirement
System (LASERS) and allows for a change in beneficiary for purposes of joint and survivor
annuities.(7/1/10)
AN ACT1
To amend and reenact R.S. 11:416(A)(3)(a) and to enact R.S. 11:446(G), (H) and (I),2
relative to the Louisiana State Employees' Retirement System; to allow for a change3
in beneficiary in certain circumstances and in relation to certain supplemental4
benefits; to provide for an effective date; and to provide for related matters.5
Notice of intention to introduce this Act has been published.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 11:416(A)(3)(a) is hereby amended and reenacted and R.S.8
11:446(G), (H) and (I) are hereby enacted to read as follows:9
§416. Employment of retirees10
A. Regardless of age, if a retiree of the system is engaged or hereafter11
engages in employment which otherwise would render him eligible for membership12
in the system, he shall choose one of the following irrevocable options:13
* * *14
(3)(a) Option 3. The retiree may request immediate suspension of his benefit15
and become a member of this system, effective on the first day of reemployment.16
Upon such regaining of membership, he shall contribute thereafter at the current17 SB NO. 14
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contribution rate as applicable to his position. Upon subsequent retirement, his1
suspended retirement allowance shall be restored to full force and effect. In addition,2
if he has worked and contributed for at least thirty-six months, his retirement3
allowance shall be increased by an amount attributable to his service and average4
compensation since reemployment based on the computation formula in effect at the5
time of subsequent retirement. If he has been reemployed for a period less than6
thirty-six months, upon termination of reemployment the contributions paid by the7
retiree since his reemployment shall, upon application, be refunded to the retiree. In8
no event shall the member receive duplicate credit for unused sick and annual leave9
that had been included in the computation of his original retirement allowance. Any10
supplemental benefit shall be based on reemployment service credit only and shall11
not include any other specific amount which may otherwise be provided in the12
regular retirement benefit computation formula. In the event of the member's death13
prior to subsequent retirement, payment of benefits to the designated beneficiary or14
survivor shall be in accordance with the option selected by the member at the time15
of his original retirement. No change in the option originally selected by the member16
shall be permitted except as provided in R.S. 11:446(C) and (G). In no event shall17
the supplemental benefit exceed an amount which, when combined with the original18
benefit, equals one hundred percent of the average compensation figure used to19
compute the supplemental benefit. Under no circumstances shall any person who has20
regained membership pursuant to the provisions of this Paragraph be allowed to21
purchase service credit for any period employed in the state service during which he22
continued to draw his retirement allowance.23
* * *24
§446. Mode of payment where option elected25
* * *26
G. Notwithstanding any other provision of law to the contrary, if any27
reemployed retiree, upon his initial retirement, selected a former spouse as his28
beneficiary pursuant to Subsection A of this Section, such reemployed retiree29 SB NO. 14
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shall be permitted to name his current spouse as beneficiary for the purposes1
of any supplemental benefit accruing after the date of his reemployment, to the2
extent that any service credit upon which such supplemental benefit is based did3
not accrue during his marriage to his former spouse. Upon subsequent4
retirement, the retiree shall select an option under Subsection A of this Section5
to apply to the supplemental benefit.6
H. No change in beneficiary pursuant to Subsection G of this Section7
shall create additional liability for the system. The system shall make any8
adjustments to payments paid or payable in accordance with the option selected9
by the retiree which are actuarially necessitated by a change of beneficiary10
pursuant to Subsection G of this Section. Such changes may include reduction11
or suspension of the monthly payments to the retiree or to his beneficiary12
named pursuant to Subsection G and shall not be applied to reduce any benefit13
payable to the originally selected beneficiary.14
I. A retiree who designates his current spouse as beneficiary pursuant15
to Subsection G of this Section shall agree to hold harmless and indemnify the16
system from any and all liability, loss or damages that the system may sustain17
as a result of actions, claims, demands and costs, including reasonable attorney18
fees, due to such designation.19
Section 2. The cost of this Act not funded by actuarial adjustments to the benefits20
paid shall be funded with additional employer contributions in compliance with Article X,21
Section 29(E)(5)(b) of the Constitution of Louisiana.22
Section 3. This Act shall become effective on July 1, 2010; if vetoed by the governor23
and subsequently approved by the legislature, this Act shall become effective on July 1,24
2010, or on the day following such approval by the legislature, whichever is later.25 SB NO. 14
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The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Lauren B. Bailey.
DIGEST
Appel (SB 14)
Present law (R.S. 11:416) allows a retiree of the Louisiana State Employees' Retirement
System (LASERS) to be reemployed in a LASERS-covered position. Provides various
"options" for how the retiree's benefit is affected by the reemployment, from which the
retiree must make an irrevocable choice at the time he becomes reemployed. Present law
Option 3 allows the reemployed retiree to earn a supplemental benefit.
Present law provides that no change in the mode of payment originally selected by the
person pursuant to present law (R.S. 11:446) is permitted except in the case of correction of
an administrative error.
Present law (R.S. 11:446) generally provides for various modes of payment of retirement
benefits from which a LASERS member may choose when he applies for retirement.
Generally, a member may elect to receive the "maximum" benefit payable throughout his
life, or he may choose the actuarial equivalent of his benefit in a reduced allowance payable
throughout his life, with a named beneficiary to receive some amount after the retiree's
death. Present law provides various "options" to the member for choosing an allowance
amount to be paid to a beneficiary upon his death. Generally, no change in the option or the
designated beneficiary may be made once the application for retirement has been filed.
Proposed law allows a reemployed LASERS retiree who previously named a prior spouse
as beneficiary upon retiring initially to designate his current spouse as beneficiary for the
purposes of any supplemental benefits that accrued after his reemployment, but only to the
extent that such supplemental benefit did not accrue during his marriage to his previous
spouse. Proposed law requires such person to select the form of allowance pursuant to
present law for the purposes of such supplemental benefit.
Proposed law provides that no change in beneficiary pursuant to proposed law shall create
additional liability for the system. Requires the system to make any adjustments to
payments paid or payable in accordance with the option selected by the retiree actuarially
necessitated by a change in beneficiary. Such changes may include reduction or suspension
of monthly payments to the retiree or to his named beneficiary.
Proposed law provides that a retiree who designated his current spouse pursuant to proposed
law shall hold harmless and indemnity the system from any and all liability, loss or damage
the system may sustain as a result of his actions.
Proposed law requires that any cost of proposed law not funded by actuarial adjustments to
the benefits paid shall be funded with additional employer contributions in compliance with
Art. X, §29(E)(5)(b) of the state constitution.
Effective July 1, 2010.
(Amends R.S. 11:416(A)(3)(a); adds R.S. 11:446(G), (H) and (I))
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Retirement to the
original bill.
1. Technical amendments. SB NO. 14
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2. Provide that no change in beneficiary pursuant to proposed law shall create
additional liability for the system. Requires the system to make any
adjustments to payments paid or payable in accordance with the option
selected by the retiree actuarially necessitated by a change in beneficiary.
Changes may include reduction or suspension of monthly payments to the
retiree or to his named beneficiary.
3. Provides that a retiree who designated his current spouse pursuant to
proposed law shall hold harmless and indemnity the system from any and all
liability, loss or damage the system may sustain as a result of his actions.