The original instrument and the following digest, which constitutes no part of the
legislative instrument, were prepared by Nancy Vicknair.
DIGEST
Martiny (SB 14)
Present law provides for transfer of service credit between La. public retirement systems.
Specifies application procedures, calculations, and payment deadlines. Provides for "reverse"
transfers, but only coincident with retirement.
Proposed law retains present law and allows for certain in-service reverse transfers. Requires
that application for an in-service reverse transfer be submitted to the receiving system on or
before Dec. 31, 2013.
Present law generally applicable to transfers specifies that the retirement benefit based on the
transferred time shall be calculated using the "percentage factor", commonly called the "accrual
rate", of the transferring system.
Present law relative to certain transfers to the Sheriffs' Pension and Relief Fund and the
secondary component and Hazardous Duty Services Plan of the La. State Employees' Retirement
System allows the member to purchase the (higher) accrual rate of the receiving system's plan
provisions. Provides for the calculation of the purchase price pursuant to present law.
Proposed law retains present law and allows any person using the transfers authorized in
proposed law to purchase the accrual rate of the receiving system at a price calculated pursuant to
present law.
Proposed law, relative to members of the Firefighters' Retirement System (FRS), allows
employees of the St. George Fire Dept. who applied to transfer service credit from the New
Orleans Fire Firefighters' Pension and Relief Fund (NOFF) into FRS on or after Aug. 26, 1999,
and on or before Dec. 31, 2007, to have the benefit accrual rate purchase permitted pursuant to
proposed law funded by their employer. Specifies that proposed law is applicable only to that
service credit transferred from NOFF during the designated time frame. Provides that the Dept.
shall pay an amount calculated pursuant to proposed law which, on an actuarial basis, totally
offsets the increase in accrued liability of FRS resulting from the accrual rate adjustment.
Requires the adjusted accrual rate to be effective on the June 30
th
following the execution of the
agreement required in proposed law. Mandates that the increase in benefit shall not be an
accrued benefit subject to the protection of Article X, Section 29(E) of the Constitution until FRS
has received full payment.
Specifies that the transaction permitted by proposed law shall be treated as a merger of service
credit. Further requires the governing authorities of the Dept. and FRS to execute a merger note
to memorialize their respective obligations and requires the payments to be amortized over the period of time applicable to mergers. Further requires the Dept. to make annual level payments
to FRS and requires the annual interest rate applicable to the note to be fixed at 7.5%.
Requires that no funds derived from the assessments against insurers shall be used to pay any
increased costs or increase in liability of FRS resulting from the provisions of proposed law.
Further requires that the provisions of proposed law shall not be construed to authorize an
increase in payments to any person receiving benefits before the effective date of proposed law.
Effective June 30, 2013.
(Amends R.S. 11:143)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Retirement to the original
bill
1. Make technical changes.