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ACT No. 238
Regular Session, 2011
HOUSE BILL NO. 332
BY REPRESENTATIVE PEARSON AND SENATOR GAUTREAUX
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
AN ACT1
To amend and reenact R.S. 11:62(3) and (6), 108(B)(1)(f) and (3), (C), (D)(introductory2
paragraph), and (E), 1732(15), 2213(4), 2225(A)(2)(a) and (6), and 2252(4), to enact3
R.S. 11:107.2 and 108(F)(3), and to repeal R.S. 11:231(A)(4) and (7) and (C)(1)(b),4
relative to the Firefighters' Retirement System, the Municipal Employees' Retirement5
System, and the Municipal Police Employees' Retirement System; to provide relative6
to the funding of such systems; to provide for membership of the boards of trustees;7
to provide for the setting of employer contribution rates under certain circumstances;8
to provide for employee contribution rates; to provide for benefit calculation; to9
provide for continuation of the duties of the Funding Review Panel; to provide an10
effective date; and to provide for related matters.11
Notice of intention to introduce this Act has been published12
as provided by Article X, Section 29(C) of the Constitution13
of Louisiana.14
Be it enacted by the Legislature of Louisiana:15
Section 1. R.S. 11:62(3) and (6), 108(B)(1)(f) and (3), (C), (D)(introductory16
paragraph), and (E), 1732(15), 2213(4), 2225(A)(2)(a) and (6), and 2252(4) are hereby17
amended and reenacted and R.S. 11:107.2 and 108(F)(3) are hereby enacted to read as18
follows: 19
§62. Employee contribution rates established20
Employee contributions to state and statewide public retirement systems shall21
be paid at the following rates, except as otherwise provided by law:22
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(3) Firefighters' Retirement System - 8%. :1
(a) Any member whose earnable compensation is less than or equal to the2
most recently issued poverty guidelines issued by the United States Department of3
Health and Human Services according to the size of the member's family unit - 8%.4
(b) For employee contributions due and payable July 1, 2011, or thereafter,5
any member whose earnable compensation is more than the most recently issued6
poverty guidelines issued by the United States Department of Health and Human7
Services according to the size of the member's family unit:8
If the total contribution9
for the fiscal year expressed10
as a percentage of payroll after11
applying all required tax The employee contribution12
contributions is: shall be:13
25.0% or below 8.0%14
25.01% to 25.75% 8.25%15
25.76% to 26.5% 8.5%16
26.51% to 27.25% 8.75%17
27.26% to 28.0% 9.0%18
28.01% to 28.75% 9.25%19
28.76% to 29.5% 9.5%20
29.51% to 30.25% 9.75%21
30.26% or above 10.0%22
* * *23
(6) Municipal Police Employees' Retirement System - 8%. :24
(a) Any member whose earnable compensation is less than or equal to the25
most recently issued poverty guidelines issued by the United States Department of26
Health and Human Services according to the size of the member's family unit - 7.5%.27
(b) For employee contributions due and payable July 1, 2011, or thereafter,28
any member whose earnable compensation is more than the most recently issued29 ENROLLEDHB NO. 332
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poverty guidelines issued by the United States Department of Health and Human1
Services according to the size of the member's family unit:2
If the total contribution3
for the fiscal year expressed4
as a percentage of payroll after5
applying all required tax The employee contribution6
contributions is: shall be:7
25.0% or below 7.5%8
25.01% to 25.75% 7.75%9
25.76% to 26.5% 8.0%10
26.51% to 27.25% 8.25%11
27.26% to 28.0% 8.5%12
28.01% to 28.75% 8.75%13
28.76% to 29.5% 9.25%14
29.51% to 30.25% 9.5%15
30.26% to 31.0% 9.75%16
31.0% or above 10.0%17
* * *18
§107.2. Employer contributions; maintaining rates; reducing rate decreases;19
Firefighters' Retirement System; Municipal Police Employees' Retirement20
System21
A. The provisions of this Section shall apply to the following statewide22
public retirement systems or funds, hereinafter referred to in this Section as23
"systems":24
(1) The Firefighters' Retirement System.25
(2) The Municipal Police Employees' Retirement System.26
B. Notwithstanding the provisions of R.S. 11:103 and 104, in any fiscal year27
during which the recommended net direct employer contribution rate would28
otherwise be decreased for any system, the board of trustees of the system is hereby29
authorized to either:30 ENROLLEDHB NO. 332
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(1) Maintain the previous fiscal year's net direct employer contribution rate1
at the time that the decrease would otherwise occur according to R.S. 11:103.2
(2) Set the employer contribution rate at any point between the previous3
year's net direct employer contribution rate and the recommended net direct4
employer contribution rate that would otherwise occur pursuant to R.S. 11:103.5
C. Any excess funds resulting from the board's exercise of its authority6
pursuant to Subsection B of this Section shall be combined with any contribution7
surplus, or offset by any contribution shortfall, and the resulting balance, if greater8
than zero, shall be applied, until exhausted, exclusively for and in the order of the9
following purposes:10
(1) To reduce the outstanding balance of any unfunded accrued liability11
existing as of the end of Fiscal Year 1988-1989, if any; however, the future payments12
for such unfunded accrued liability shall continue to be made according to the13
original amortization schedule established in compliance with the requirements of14
Article X, Section 29(E)(3) of the Constitution of Louisiana until the outstanding15
balance is fully liquidated.16
(2) To reduce the outstanding amortization charge base or bases with the17
greatest number of outstanding payments; however, the future payments on the base18
or bases shall continue to be made according to the original amortization schedule19
until the outstanding balance is fully liquidated.20
D. The board's exercise of its authority pursuant to Subsection B of this21
Section shall not cause the employer contribution rate to exceed fifteen percent in22
any fiscal year.23
§108. Funding Review Panel24
* * *25
B. The panel shall be composed of two committees, the advisory committee26
of seven members and the recommendations committee of seven members.27
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(1) The recommendations committee shall have the following voting1
members:2
* * *3
(f) The state treasurer commissioner of administration or his designee.4
* * *5
(3)(a) The panel shall elect from the members of the recommendations6
committee a chairman and vice chairman of the panel. If the state treasurer is elected7
chairman or vice chairman, his designee shall serve in such office at any meeting of8
the panel at which he represents the treasurer. 9
(b) At the first meeting in Fiscal Year 2010-2011, and at the first meeting in10
each fiscal year thereafter, the panel shall elect from the members of the11
recommendations committee a chairman and vice chairman of the panel. If the state12
treasurer commissioner of administration is elected chairman or vice chairman, his13
designee shall serve in such office at any meeting of the panel at which he represents14
the treasurer commissioner.15
* * *16
C.(1) The panel shall meet not less than monthly if practicable. The17
treasurer shall call the first meeting of the panel on or before August 31, 2005, and18
shall preside until the panel elects a chairman and vice chairman.19
(2) The treasurer shall call the first meeting for Fiscal Year 2010-2011 on or20
before August 31, 2010. The treasurer or his designee shall preside until the panel21
elects a chairman and vice chairman.22
(3) The commissioner shall call the first meeting in each fiscal year on or23
before August thirty-first. The commissioner or his designee shall preside until the24
panel elects a chairman and vice chairman.25
D. The panel shall undertake a continuous and comprehensive review of the26
actuarial funding and benefit structure of the Firefighters' Retirement System, the27
Municipal Employees' Retirement System, and the Municipal Police Employees'28
Retirement System, including but not limited to the following:29
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E. The systems, the House of Representatives, the Senate, the legislative1
actuary, the legislative auditor, and the legislative fiscal office the Louisiana2
Municipal Association, and the Louisiana Conference of Mayors shall provide such3
staff and facilities to the panel as are necessary to carry out its duties and4
responsibilities.5
F.6
* * *7
(3) On or before February first, in even-numbered years, and on or before8
March first, in odd-numbered years, the panel shall submit to the House and Senate9
committees on retirement and to the legislative auditor a report containing its10
recommendations for increasing the actuarial soundness of each system and for11
providing an affordable benefit for members of each system.12
* * *13
§1732. Definitions14
The following words and phrases, as used in this Chapter, unless a different15
meaning is plainly required by the context, shall have the following meaning:16
* * *17
(15)(a) "Final compensation", for a member whose first employment making18
him eligible for membership in the system began on or before June 30, 2006, means19
the average monthly earnings during the highest thirty-six consecutive months or20
joined months if service was interrupted. The earnings to be considered for the21
thirteenth through the twenty-fourth months shall not exceed one hundred22
twenty-five fifteen percent of the earnings for the first through the twelfth months.23
The earnings to be considered for the final twelve months shall not exceed one24
hundred twenty-five fifteen percent of the earnings of the thirteenth through the25
twenty-fourth months.26
(b) "Final compensation", for a member whose first employment making him27
eligible for membership in the system began on or after July 1, 2006, means the28 ENROLLEDHB NO. 332
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average monthly earnings during the highest sixty consecutive months or joined1
months if service was interrupted. The earnings to be considered for the thirteenth2
through the twenty-fourth months shall not exceed one hundred twenty-five fifteen3
percent of the earnings for the first through the twelfth months. The earnings to be4
considered for the twenty-fifth through the thirty-sixth month shall not exceed one5
hundred twenty-five fifteen percent of the earnings for the thirteenth through the6
twenty-fourth month. The earnings to be considered for the thirty-seventh through7
the forty-eighth month shall not exceed one hundred twenty-five fifteen percent of8
the earnings for the twenty-fifth through the thirty-sixth month. The earnings to be9
considered for the final twelve months shall not exceed one hundred twenty-fiv e10
fifteen percent of the earnings of the thirty-seventh through the forty-eighth month.11
* * *12
§2213. Definitions13
The following words and phrases, as used in this Subpart, unless a different14
meaning is plainly required by context, shall have the following meaning:15
* * *16
(4) "Average final compensation" shall mean the average annual earned17
compensation of an employee for any period of thirty-six successive or joined18
months of service as an employee during which the said earned compensation was19
the highest. In case of interruption of employment, the thirty-six month period shall20
be computed by joining employment periods immediately preceding and succeeding21
the interruption. The earnings to be considered for the thirteenth through the22
twenty-fourth months shall not exceed one hundred fifteen percent of the earnings23
for the first through the twelfth months. The earnings to be considered for the final24
twelve months shall not exceed one hundred fifteen percent of the earnings of the25
thirteenth through the twenty-fourth months.26
* * *27
§2225. Administration28
A. Board of trustees:29
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(2)(a) The board shall consist of eleven fifteen trustees as follows: Seven1
members, three of whom shall not be chiefs of police but shall be active contributing2
members of the system with ten or more years of creditable service, and four of3
whom shall be active contributing chiefs of police, with four or more years of4
creditable service provided that no municipal police department shall have more than5
one member and one chief of police on the board at the same time, and two of whom6
shall be; two regular retirees of the system, one retired from Chiefs District I and one7
retired from Chiefs District II as those districts are comprised in Subparagraphs (b)8
and (c) of this Paragraph, Paragraph; and four ex officio trustees to include the9
chairman of the House of Representatives Committee on Retirement or his designee,10
and the chairman of the Senate Committee on Retirement or his designee, the11
commissioner of administration or his designee, and the state treasurer or his12
designee; and two mayors appointed by the Louisiana Municipal Association from13
municipalities having police departments participating in the system, to serve at the14
pleasure of the Louisiana Municipal Association. The retired trustees shall be15
elected by the retired members of the system for a term of five years with the first16
retired trustees' terms to commence on July 1, 1997. Whenever the term of a board17
member expires, the term of the newly elected board member shall be for a term of18
five years. The director of the retirement system shall be selected by the eleven19
members of the board board of trustees. Election of members shall be under such20
rules and regulations as the board of trustees shall establish.21
* * *22
(6) Each trustee shall be entitled to one vote on the board. Six Eight trustees23
shall constitute a quorum for any board meeting, and a majority vote of the trustees24
present shall be necessary for a decision by the trustees at any meeting of the board.25
* * *26
§2252. Definitions27
The following words and phrases, as used in this Chapter, unless a different28
meaning is plainly required by context, shall have the following meaning:29
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(4) "Average final compensation" shall mean the average annual earned1
compensation of an employee for any period of thirty-six successive or joined2
months of service as an employee during which the said earned compensation was3
the highest. In case of interruption of employment, the thirty-six month period shall4
be computed by joining employment periods immediately preceding and succeeding5
the interruption. The earnings to be considered for the thirteenth through the6
twenty-fourth months shall not exceed one hundred fifteen percent of the earnings7
for the first through the twelfth months. The earnings to be considered for the final8
twelve months shall not exceed one hundred fifteen percent of the earnings of the9
thirteenth through the twenty-fourth months.10
* * *11
Section 2. R.S. 11:231(A)(4) and (7) and (C)(1)(b) are hereby repealed in their12
entirety.13
Section 3. The provisions of R.S. 11:1732(15), 2213(4), and 2252(4) as amended by14
this Act shall not cause the average compensation of any member retiring on or after the15
effective date of this Act to be less than such member's average compensation as it existed16
before the effective date of this Act.17
Section 4. As soon as practicable after the effective date of this Act, the Public18
Retirement Systems' Actuarial Committee shall meet to adopt a revised employer19
contribution rate resulting from the changes contained in this Act, to be utilized for Fiscal20
Year 2011-2012, for each of the systems affected by this Act. Notwithstanding the21
provisions of R.S. 11:127(B) and (C), a revised valuation shall not be required for the22
purpose of implementing the revised employer contribution rate.23
Section 5. The provisions of the Act limiting increases in final compensation used24
for purposes of calculation of benefits shall not be applied to any salary increases due to25
promotions within any civil service system.26 ENROLLEDHB NO. 332
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Section 6. This Act shall become effective on June 30, 2011; if vetoed by the1
governor and subsequently approved by the legislature, this Act shall become effective on2
June 30, 2011, or on the day following such approval by the legislature, whichever is later.3
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: