Louisiana Senate Bill SB49

Louisiana 2012 Regular Session

• Introduced: 3/12/12
• Refer: 3/12/12
• Report Pass: 4/30/12
• Engrossed: 5/3/12
• Refer: 5/7/12
• Report Pass: 5/21/12
• Enrolled: 6/3/12
• Chaptered: 6/11/12
• Passed: 6/11/12

Caption

Provides for a second tier of benefits for persons employed on or after 1/1/13. (7/1/12) (EN -$3,162,000 FC LF EX)

Impact

The bill's implications for state law are profound, modifying existing retirement provisions for employees. Specifically, it alters how benefits are calculated, as the new members in these tiers will see their retirement allowances based on a percentage of their earnings multiplied by their years of service. This approach aims to provide more sustainable retirement benefits in light of changing demographics and fiscal pressures on the retirement system.

Summary

Senate Bill 49 pertains to the Municipal Employees' Retirement System (MERS) and introduces significant changes to the retirement benefits for new members hired on or after January 1, 2013. The bill establishes two separate subplans within the existing retirement system: Plan A Tier 2 and Plan B Tier 2. Each of these new tiers applies different eligibility requirements for retirement and introduces varying percentages of earnings for the calculation of retirement allowances.

Sentiment

Overall, the sentiment surrounding SB 49 has been cautiously optimistic among employees who understand the need for sustainable retirement plans. Some members of the legislative community viewed the bill as a necessary step to ensure the longevity of retirement benefits for future workers, while others expressed concerns about the sufficiency of benefits, especially in the context of inflation and rising living costs.

Contention

Key points of contention include the changes in contribution percentages and retirement calculations that might affect the financial wellbeing of future retirees. Critics of the bill fear that setting contributions within a range of eight to ten percent could lead to inadequate retirement savings for employees, ultimately harming them in the later stages of their lives. Additionally, the distinctions made between the tiers have raised questions about fairness and equity among workers who have similar roles but differing retirement benefits due to their hiring dates.