Page 1 of 4
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Regular Session, 2011 ENROLLED
SENATE BILL NO. 6
BY SENATOR GAUTREAUX
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
AN ACT1
To enact R.S. 11:887.1, relative to the Teachers' Retirement System of Louisiana; to provide2
for payment of unfunded accrued liability by an employer that withdraws some or3
all of its employees from the retirement system; to provide for all other withdrawal4
liabilities of such employers; to provide for determination of amount of withdrawal5
liability payment and collection of same; to provide an effective date; and to provide6
for related matters.7
Notice of intention to introduce this Act has been published.8
Be it enacted by the Legislature of Louisiana:9
Section 1. R.S. 11:887.1 is hereby enacted to read as follows:10
ยง887.1. Unfunded accrued liability; payment by employing agency11
A.(1)(a) Notwithstanding any other provision of law to the contrary, if12
an employing agency is authorized by law to terminate its participation in the13
retirement system and terminates participation for all of its employees, such14
employing agency shall remit to the retirement system its proportionate share15
of any unfunded actuarial accrued liability of the retirement system, as further16
provided in this Section.17
(b) Notwithstanding any other provision of law to the contrary, if an18
employing agency terminates its participation in the retirement system as19
authorized by administrative action, contract, or other legally authorized20
action, and terminates participation for all of its employees, any entity21
authorizing such termination shall remit to the retirement system the employing22
agency's proportionate share of any unfunded actuarial accrued liability of the23
retirement system, as further provided in this Section.24
(c) Notwithstanding any other provision of law to the contrary, if an25
employing agency whose employees are not members of the retirement system,26 SB NO. 6 ENROLLED
Page 2 of 4
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
hires any employee previously employed by another employing agency whose1
employees were members of the retirement system there shall be no obligation2
on the part of the hiring employing agency for any unfunded accrued liability3
resulting from the employee's previous employment.4
(2) Notwithstanding any other provision of law to the contrary, if an5
employing agency terminates its participation in the retirement system for some6
of its employees by eliminating positions held by such employees through7
privatization, the employer shall remit to the retirement system its8
proportionate share of any unfunded actuarial accrued liability, as further9
provided in this Section.10
(3)(a) Notwithstanding any other provision of law to the contrary, if a11
school or entity under an employer's jurisdiction is converted to any other12
governance model and, by administrative action, contract, or other legally13
authorized action, the prospective employing entity is permitted by the14
employer to terminate its participation or forgo participation in the retirement15
system, the employer shall remit to the retirement system the proportionate16
share of any unfunded actuarial accrued liability, as further provided in this17
Section.18
(b) Notwithstanding any other provision of law to the contrary, if a19
school or entity under an employer's jurisdiction is transferred to any other20
entity and the receiving entity permits the prospective employing agency, as21
applicable, to terminate participation or forgo participation in the retirement22
system, the receiving entity shall remit to the retirement system the23
proportionate share of any unfunded actuarial accrued liability, as further24
provided in this Section.25
(4) For purposes of this Section, the following terms shall have the26
following meanings:27
(a) "Proportionate share of any unfunded accrued liability" shall mean28
the unfunded accrued liability, if any, which is attributable to benefits accrued29
by or granted to employees and retirees of the employing agency which was30 SB NO. 6 ENROLLED
Page 3 of 4
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
established during the period of time that the employing agency was a1
participating employer with the retirement system or, with respect to2
Paragraph (A)(3) of this Section, during the period of time the school or entity3
was under the employer's jurisdiction.4
(b) "Privatization" shall mean the elimination of positions eligible for5
membership in the retirement system without eliminating the services provided6
or delivered or the functions performed, and the outsourcing, contracting for7
the service or function with a private employer, or utilization of any other legal8
mechanism having the same effect, with the result that the service or function9
previously provided, delivered, or performed by an employee in a retirement10
system-covered position is now provided, delivered, or performed by a person11
or persons in positions which are not eligible for system coverage.12
B.(1) The actuary employed by the retirement system shall determine13
the amounts required to be remitted pursuant to this Section as of the June14
thirtieth immediately prior to the respective date of the termination of15
participation, elimination of positions, or conversion or transfer of the school16
or entity.17
(2)(a) Should the entity responsible for payment disagree with the18
amounts determined by the retirement system actuary, such entity may appeal19
to the Public Retirement Systems' Actuarial Committee within thirty days of20
receipt of the invoice.21
(b) The legislative auditor shall perform an independent determination22
of the amounts due and in the event his calculation disagrees with that of the23
retirement system actuary, the committee shall meet and render a final24
determination. In the event the calculations agree, the invoice shall be due as25
provided in this Section.26
(3) The amounts due pursuant to this Section shall, at the option of the27
employing agency, be paid either in a lump sum or in equal monthly payments28
with interest at the retirement system's actuarial valuation rate amortized over29
ten years or less.30 SB NO. 6 ENROLLED
Page 4 of 4
Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
C. Should an employing agency fail to make payment pursuant to this1
Section timely, the amount due shall be collected in the same manner as2
authorized by R.S. 11:886 and 887.3
Section 2. The provisions of this Act shall apply to any employing agency4
participating in the retirement system in any plan year ending on or after June 30, 2011.5
Section 3. This Act shall become effective on June 30, 2011; if vetoed by the6
governor and subsequently approved by the legislature, this Act shall become effective on7
June 30, 2011, or on the day following such approval by the legislature, whichever is later.8
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: