Louisiana House Bill HB33

Louisiana 2013 Regular Session

Caption

Provides for continued payment of the unfunded accrued liability portion of employer contributions after participation ceases (OR INCREASE FC GF & LF EX)

Impact

The primary impact of HB 33 is the requirement for terminating employers to pay their portion of any unfunded liabilities when they cease participation in TRSL. This change is designed to protect remaining employers from increased financial burdens resulting from withdrawals. Employers will be faced with either making a lump sum payment or opting for a loan to cover this payment over ten years. This payment policy encourages employers to consider the long-term financial implications of their actions regarding workforce management and retirement benefits.

Summary

House Bill 33 addresses the issue of employers withdrawing from the Teachers’ Retirement System of Louisiana (TRSL). It mandates that any employer that terminates participation for some or all of its employees must pay its proportionate share of any unfunded accrued liability. This bill aims to correct the current inequity where employers could opt out and pass their financial liabilities onto remaining employers, thereby smoothing the impact on the overall retirement system. This legislation is an attempt to ensure that financial responsibilities are maintained when employers exit the system.

Sentiment

The sentiment surrounding HB 33 appears to be largely focused on ensuring fairness within the retirement system. Supporters see it as a necessary reform to hold employers accountable for their financial obligations, thus promoting stability within the pension system. Conversely, there may be concerns among some employers about the increased financial burdens imposed on them upon withdrawal. The overall attitude remains cautiously optimistic, emphasizing accountability while recognizing potential financial strain on certain employers.

Contention

Notable points of contention may arise regarding the implementation of the bill and its effects on employers, particularly in sectors like higher education. Some may argue that the bill could deter employers from making necessary staffing changes or restructuring by introducing additional financial liability. The challenge will be striking a balance between maintaining the integrity of the retirement system and providing flexibility for employers navigating workforce transformations.