Louisiana House Bill HB314

Louisiana 2011 Regular Session

• Introduced: 4/25/11
• Refer: 4/25/11

Caption

Provides relative to the Municipal Police Employees' Retirement System, allows a retiree to change his designated beneficiary from a former spouse to a current spouse (OR NO IMPACT APV)

Impact

The implications of Bill HB314 are significant for retirees of the MPERS. By permitting a change in beneficiary, it directly affects the structure of retirement benefits for those who have remade their lives after divorce. However, the bill outlines strict limitations, ensuring that any change in the beneficiary does not create additional liability for the retirement system or conflict with existing court orders regarding community property. This maintains the financial integrity of the system while offering retirees greater flexibility and reflecting a more current familial situation.

Summary

House Bill 314 aims to amend the regulations surrounding the Municipal Police Employees' Retirement System (MPERS), specifically in regard to the flexibility of retirees in designating beneficiaries. The existing law restricts retirees from changing their designated beneficiaries after retirement, with very few exceptions. The proposed legislation seeks to allow retirees who had initially designated a former spouse as their beneficiary to instead designate their current spouse as their beneficiary, provided they have been married to the current spouse for at least eight years and file the change within a specified time frame. This change is set to take effect on July 1, 2011.

Sentiment

The sentiment surrounding HB314 appears largely supportive among those who advocate for the rights of retirees to adjust their benefits in line with personal circumstances. Supporters emphasize the importance of allowing retirees to secure their current spouse's financial future, especially in cases where the retiree has started a new family. However, potential concerns regarding the financial implications for the MPERS system and the management of benefits, given the new provisions being introduced, have raised questions among opponents about the sustainability and fairness of the alterations.

Contention

While the bill is positioned as a pro-retiree measure, it does not come without its points of contention. The stringent requirements and timetable for enacting the change in beneficiary could be a barrier for some retirees. Furthermore, the process of actuarial evaluation required for any beneficiary change, along with the stipulation that the benefit remains actuarially equivalent to the original payment, introduces complexities that could complicate the implementation of this measure. As such, the discussions around the bill may also highlight the tension between the need for modernization of retirement laws and the need to maintain the fiscal health of the retirement system.