ENROLLED
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ACT No. 399
Regular Session, 2014
HOUSE BILL NO. 1225
BY REPRESENTATIVE ROBIDEAUX AND SENATORS GUILLORY, APPEL,
CORTEZ, CROWE, LONG, PEACOCK, AND PERRY
AN ACT1
To amend and reenact R.S. 11:102(B)(3)(d)(v) through (viii), 102.1(B)(3)(b), (4), and (5)2
and (C)(4) and (5), 102.2(B)(3)(b) and (4) and (C)(4) and (5), 542(A)(2) and (3),3
(C)(1) through (3), and (F)(1), 883.1(A)(2) and (3), (C)(1) through (3), (F), and4
(G)(1), 1145.1(A), (C)(1) through (3), and (D), and 1332(A), (C)(1) through (3), (D),5
and (F) and to enact R.S. 11:102.1(B)(6) and (C)(6), 102.2(B)(5) and (C)(6), 102.3,6
542(G), 883.1(H), 1145.1(F), and 1332(G), relative to the liabilities of the state7
retirement systems; to provide for payment of such liabilities; to limit creation of8
certain additional liabilities through benefit increases; to provide relative to9
authorization of such benefit increases; to provide for an effective date; and to10
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. 11:102(B)(3)(d)(v) through (viii), 102.1(B)(3)(b), (4), and (5) and16
(C)(4) and (5), 102.2(B)(3)(b) and (4) and (C)(4) and (5), 542(A)(2) and (3), (C)(1) through17
(3), and (F)(1), 883.1(A)(2) and (3), (C)(1) through (3), (F), and (G)(1), 1145.1(A), (C)(1)18
through (3), and (D), and 1332(A), (C)(1) through (3), (D), and (F) are hereby amended and19
reenacted and R.S. 11:102.1(B)(6) and (C)(6), 102.2(B)(5) and (C)(6), 102.3, 542(G),20
883.1(H), 1145.1(F), and 1332(G) are hereby enacted to read as follows: 21
§102. Employer contributions; determination; state systems22
* * *23 ENROLLEDHB NO. 1225
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B.1
* * *2
(3) With respect to each state public retirement system, the actuarially3
required employer contribution for each fiscal year, commencing with Fiscal Year4
1989-1990, shall be that dollar amount equal to the sum of:5
* * *6
(d) That fiscal year's payment, computed as of the first of that fiscal year and7
projected to the middle of that fiscal year at the actuarially assumed interest rate,8
necessary to amortize changes in actuarial liability due to:9
* * *10
(v)(aa)(I) Effective July 1, 2004, and beginning with Fiscal Year 1998-1999,11
the amortization period for the changes, gains, or losses of the Louisiana State12
Employees' Retirement System provided in Items (i) through (iv) of this13
Subparagraph shall be thirty years, or in accordance with standards promulgated by14
the Governmental Accounting Standards Board, from the year in which the change,15
gain, or loss occurred. The outstanding balances of amortization bases established16
pursuant to Items (i) through (iv) of this Subparagraph before Fiscal Year17
1998-1999, shall be amortized as a level dollar amount from July 1, 2004, through18
June 30, 2029. Beginning with Fiscal Year 2003-2004, and for each fiscal year19
thereafter, the outstanding balances of amortization bases established pursuant to20
Items (i) through (iv) of this Subparagraph shall be amortized as a level dollar21
amount. For the Louisiana State Employees' Retirement System, effective for the22
June 30, 2010, system valuation and beginning with Fiscal Year 2011-2012,23
amortization payments for changes in actuarial liability shall be determined in24
accordance with Subsection C of this Section.25
(II) Notwithstanding the provisions of Subsubitem (I) of this Subitem,26
effective for the June thirtieth valuation following the fiscal year in which the system27
first attains a funded percentage of eighty-five or more and for every year thereafter,28
the amortization period for the changes, gains, or losses of the Louisiana State29
Employees' Retirement System provided in Items (i) through (iv) of this30 ENROLLEDHB NO. 1225
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Subparagraph shall be twenty years from the year in which the change, gain, or loss1
occurred.2
(bb)(I) Effective for the June thirtieth valuation for the fiscal year3
immediately following the year in which the system fully liquidates an amortization4
base established in R.S. 11:102.1 and for each valuation thereafter, after any5
remaining payment required pursuant to R.S. 11:102.1, the system shall apply to the6
oldest outstanding positive amortization base of the system, the system's remaining7
excess investment experience returns. For the first valuation to which this8
Subsubitem applies the amount of excess returns to be applied pursuant to the9
provisions of this Subsubitem shall be the excess returns up to the amount of excess10
investment experience returns as equals that year's remaining payment pursuant to11
R.S. 11:102.1. Upon complete liquidation of such amortization base, any remaining12
funds shall be applied to the next oldest outstanding positive amortization base until13
no further funds remain or all such bases are completely liquidated. Notwithstanding14
any provision of this Subitem to the contrary, the maximum amount of excess returns15
to be applied in any subsequent year pursuant to this Subsubitem shall equal the prior16
year's maximum amount increased by the percentage increase in the system's17
actuarial value of assets for the preceding year, if any. For any payment made18
pursuant to the provisions of this Subsubitem, if the system is eighty-five percent19
funded or greater prior to the application of the funds, the net remaining liability20
shall be reamortized over the remaining amortization period with annual payments21
calculated as provided in this Item; if the system is less than eighty-five percent22
funded prior to application of the funds, the net remaining liability shall not be23
reamortized after such application. For the purposes of this Subsubitem, the oldest24
outstanding positive amortization base shall first mean the Original Amortization25
Base until it is completely liquidated, then the Experience Account Amortization26
Base until it is completely liquidated, and then the oldest outstanding debt of the27
system excluding any amortization base established to amortize a particularized28
liability established pursuant to Subsection C of this Section or a liability established29
pursuant to Subparagraphs (2)(a) and (3)(c) of this Subsection.30 ENROLLEDHB NO. 1225
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(II) Effective for the June thirtieth valuation for the fiscal year immediately1
following the year in which the system fully liquidates the last remaining2
amortization base established in R.S. 11:102.1 and for each valuation thereafter, if3
the system's investment experience for the fiscal year exceeds the system's actuarial4
assumed rate of return, the system shall apply to the oldest outstanding positive5
amortization base of the system, excluding any amortization base established to6
amortize a particularized liability established pursuant to Subsection C of this7
Section or a liability established pursuant to Subparagraphs (2)(a) and (3)(c) of this8
Subsection, the system's excess investment experience returns. For the first9
valuation to which this Subsubitem applies, the amount of excess returns to be10
applied pursuant to the provisions of this Subsubitem shall be the excess returns up11
to the amount of excess investment experience returns as equals double the last12
payment made pursuant to Subsubitem (I) of this Subitem. Upon complete13
liquidation of such amortization base, any remaining funds shall be applied to the14
next oldest outstanding positive amortization base until no further funds remain or15
all such bases are completely liquidated. Notwithstanding any provision of this16
Subitem to the contrary, the maximum amount of excess returns to be applied in any17
subsequent year pursuant to this Subsubitem shall equal the prior year's maximum18
amount increased by the percentage increase in the system's actuarial value of assets19
for the preceding year, if any. For any payment made pursuant to the provisions of20
this Subsubitem, if the system is eighty-five percent funded or greater prior to the21
application of the funds, the net remaining liability shall be reamortized over the22
remaining amortization period with annual payments calculated as provided in this23
Item; if the system is less than eighty-five percent funded prior to application of the24
funds, the net remaining liability shall not be reamortized after such application.25
(cc) Effective for the June 30, 2019, system valuation and for each valuation26
thereafter, actuarial gains allocated to the experience account shall be amortized as27
a loss with level payments over a ten-year period.28
(dd) Notwithstanding any provision of this Item to the contrary, for the June29
30, 2014, valuation the amortization period for investment gains not allocated to the30 ENROLLEDHB NO. 1225
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Original Amortization Base, the Experience Account Amortization Base, or credited1
to the experience account shall be five years.2
(vi)(aa)(I) Effective July 1, 2004, and beginning with Fiscal Year 2000-2001,3
the amortization period for the changes, gains, or losses of the Louisiana School4
Employees' Retirement System provided in Items (i) through (iv) of this5
Subparagraph shall be thirty years, or in accordance with standards promulgated by6
the Governmental Accounting Standards Board, from the year in which the change,7
gain, or loss occurred. The outstanding balances of amortization bases established8
pursuant to Items (i) through (iv) of this Subparagraph before Fiscal Year 2000-9
2001, shall be amortized as a level dollar amount from July 1, 2004, through June 30,10
2029. Beginning with Fiscal Year 2003-2004, and for each fiscal year thereafter, the11
outstanding balances of amortization bases established pursuant to Items (i) through12
(iv) of this Subparagraph shall be amortized as a level dollar amount.13
(II) Notwithstanding the provisions of Subsubitem (I) of this Subitem,14
effective for the June thirtieth valuation following the fiscal year in which the15
system first attains a funded percentage of eighty-five or more and for every year16
thereafter, the amortization period for the changes, gains, or losses of the Louisiana17
School Employees' Retirement System provided in Items (i) through (iv) of this18
Subparagraph shall be twenty years from the year in which the change, gain, or loss19
occurred.20
(bb)(I) Effective for the June 30, 2014, valuation, if the system's investment21
experience for the fiscal year exceeds the system's actuarial assumed rate of return,22
the system shall apply the excess investment experience returns, up to the first seven23
and one-half million dollars, to the oldest outstanding positive amortization base of24
the system, excluding any amortization base established to amortize a liability25
established pursuant to Subparagraphs (2)(a) and (3)(c) of this Subsection, and26
without reamortization of such base.27
(II) Effective for the June 30, 2015, valuation and for each valuation28
thereafter, if the system's investment experience for the fiscal year exceeds the29
system's actuarial assumed rate of return, the system shall apply the excess30 ENROLLEDHB NO. 1225
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investment experience returns, up to the first fifteen million dollars for the June 30,1
2015, valuation, to the oldest outstanding positive amortization base of the system,2
excluding any amortization base established to amortize a liability established3
pursuant to Subparagraphs (2)(a) and (3)(c) of this Subsection. Upon complete4
liquidation of such amortization base, any remaining funds shall be applied to the5
next oldest outstanding positive amortization base until no further funds remain or6
all such bases are completely liquidated. Notwithstanding any provision of this7
Subsubitem to the contrary, the maximum amount of excess returns to be applied in8
any subsequent year pursuant to this Subsubitem shall equal the prior year's9
maximum amount increased by the percentage increase in the system's actuarial10
value of assets for the preceding year, if any. For any payment made pursuant to the11
provisions of this Subsubitem, if the system is eighty-five percent funded or greater12
prior to the application of the funds, the net remaining liability shall be reamortized13
over the remaining amortization period with annual payments calculated as provided14
in this Item; if the system is less than eighty-five percent funded prior to application15
of the funds, the net remaining liability shall not be reamortized after such16
application.17
(cc) Effective for the June 30, 2019, system valuation and for each valuation18
thereafter, actuarial gains allocated to the experience account shall be amortized as19
a loss with level payments over a ten-year period.20
(dd) Notwithstanding any provision of this Item to the contrary, for the June21
30, 2014, valuation the amortization period for investment gains not allocated to the22
oldest outstanding positive amortization base pursuant to Subitem (bb) of this Item23
or credited to the experience account shall be five years.24
(vii)(aa)(I) Effective July 1, 2004, and beginning with Fiscal Year 2000-25
2001, the amortization period for the changes, gains, or losses of the Teachers'26
Retirement System of Louisiana provided in Items (i) through (iv) of this27
Subparagraph shall be thirty years, or in accordance with standards promulgated by28
the Governmental Accounting Standards Board, from the year in which the change,29
gain, or loss occurred. The outstanding balances of amortization bases established30 ENROLLEDHB NO. 1225
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pursuant to Items (i) through (iv) of this Subparagraph before Fiscal Year 2000-1
2001, shall be amortized as a level dollar amount from July 1, 2004, through June 30,2
2029. Beginning with Fiscal Year 2003-2004, and for each fiscal year thereafter, the3
outstanding balances of amortization bases established pursuant to Items (i) through4
(iv) of this Subparagraph shall be amortized as a level dollar amount. For the5
Teachers' Retirement System of Louisiana, effective for the June 30, 2011, system6
valuation and beginning with Fiscal Year 2012-2013, amortization payments for7
changes in actuarial liability shall be determined in accordance with Subsection D8
of this Section.9
(II) Notwithstanding the provisions of Subsubitem (I) of this Subitem,10
effective for the June thirtieth valuation following the fiscal year in which the system11
first attains a funded percentage of eighty-five or more and for every year thereafter,12
the amortization period for the changes, gains, or losses of the Teachers' Retirement13
System of Louisiana provided in Items (i) through (iv) of this Subparagraph shall be14
twenty years from the year in which the change, gain, or loss occurred.15
(bb)(I) Effective for the June thirtieth valuation for the fiscal year16
immediately following the year in which the system fully liquidates an amortization17
base established in R.S. 11:102.2 and for each valuation thereafter, after any18
remaining payment required pursuant to R.S. 11:102.2, the system shall apply to the19
oldest outstanding positive amortization base of the system, the system's remaining20
excess investment experience returns. For the first valuation to which this21
Subsubitem applies the amount of excess returns to be applied pursuant to the22
provisions of this Subsubitem shall be the excess returns up to the amount of excess23
investment experience returns as equals that year's remaining payment pursuant to24
R.S. 11:102.2. Upon complete liquidation of such amortization base, any remaining25
funds shall be applied to the next oldest outstanding positive amortization base until26
no further funds remain or all such bases are completely liquidated. Notwithstanding27
any provision of this Subitem to the contrary, the maximum amount of excess returns28
to be applied in any subsequent year pursuant to this Subsubitem shall equal the prior29
year's maximum amount increased by the percentage increase in the system's30 ENROLLEDHB NO. 1225
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actuarial value of assets for the preceding year, if any. For any payment made1
pursuant to the provisions of this Subsubitem, if the system is eighty-five percent2
funded or greater prior to the application of the funds, the net remaining liability3
shall be reamortized over the remaining amortization period with annual payments4
calculated as provided in this Item; if the system is less than eighty-five percent5
funded prior to application of the funds, the net remaining liability shall not be6
reamortized after such application. For the purposes of this Subitem, the oldest7
outstanding positive amortization base shall first mean the Original Amortization8
Base until it is completely liquidated, then the Experience Account Amortization9
Base until it is completely liquidated, and then the oldest outstanding debt of the10
system excluding any amortization base established to amortize a particularized11
liability established pursuant to Subsection D of this Section or a liability established12
pursuant to Subparagraphs (2)(a) and (3)(c) of this Subsection.13
(II) Effective for the June thirtieth valuation for the fiscal year immediately14
following the year in which the system fully liquidates the last remaining15
amortization base established in R.S. 11:102.2 and for each valuation thereafter, if16
the system's investment experience for the fiscal year exceeds the system's actuarial17
assumed rate of return, the system shall apply to the oldest outstanding positive18
amortization base of the system, excluding any amortization base established to19
amortize a particularized liability established pursuant to Subsection D of this20
Section or a liability established pursuant to Subparagraphs (2)(a) and (3)(c) of this21
Subsection, the system's excess investment experience returns. For the first22
valuation to which this Subsubitem applies, the amount of excess returns to be23
applied pursuant to the provisions of this Subsubitem shall be the excess returns up24
to the amount of excess investment experience returns as equals double the last25
payment made pursuant to Subsubitem (I) of this Subitem. Upon complete26
liquidation of such amortization base, any remaining funds shall be applied to the27
next oldest outstanding positive amortization base until no further funds remain or28
all such bases are completely liquidated. Notwithstanding any provision of this29
Subitem to the contrary, the maximum amount of excess returns to be applied in any30 ENROLLEDHB NO. 1225
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subsequent year pursuant to this Subsubitem shall equal the prior year's maximum1
amount increased by the percentage increase in the system's actuarial value of assets2
for the preceding year, if any. For any payment made pursuant to the provisions of3
this Subsubitem, if the system is eighty-five percent funded or greater prior to the4
application of the funds, the net remaining liability shall be reamortized over the5
remaining amortization period with annual payments calculated as provided in this6
Item; if the system is less than eighty-five percent funded prior to application of the7
funds, the net remaining liability shall not be reamortized after such application.8
(cc) Effective for the June 30, 2019, system valuation and for each valuation9
thereafter, actuarial gains allocated to the experience account shall be amortized as10
a loss with level payments over a ten-year period.11
(dd) Notwithstanding any provision of this Item to the contrary, for the June12
30, 2014, valuation the amortization period for investment gains not allocated to the13
Original Amortization Base, the Experience Account Amortization Base, or credited14
to the experience account shall be five years.15
(viii)(aa)(I) Effective July 1, 2009, and beginning with Fiscal Year 1992-16
1993, the amortization period for the changes, gains, or losses of the Louisiana State17
Police Retirement System provided in Items (i) through (iv) of this Subparagraph18
shall be thirty years, or in accordance with standards promulgated by the19
Governmental Accounting Standards Board, from the year in which the change, gain,20
or loss occurred. The outstanding balances of amortization bases established21
pursuant to Items (i) through (iv) of this Subparagraph before Fiscal Year 2008-22
2009, shall be amortized as a level dollar amount from July 1, 2009, through June 30,23
2029. Beginning with Fiscal Year 2008-2009, and for each fiscal year thereafter, the24
outstanding balances of amortization bases established pursuant to Items (i) through25
(iv) of this Subparagraph shall be amortized as a level dollar amount.26
(II) Notwithstanding the provisions of Subsubitem (I) of this Subitem,27
effective for the June thirtieth valuation following the fiscal year in which the28
system first attains a funded percentage of eighty-five or more and for every year29
thereafter, the amortization period for the changes, gains, or losses of the Louisiana30 ENROLLEDHB NO. 1225
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State Police Retirement System provided in Items (i) through (iv) of this1
Subparagraph shall be twenty years from the year in which the change, gain, or loss2
occurred.3
(bb)(I) Effective for the June 30, 2014, valuation, if the system's investment4
experience for the fiscal year exceeds the system's actuarial assumed rate of return,5
the system shall apply the excess investment experience returns, up to the first two6
and one-half million dollars, to the oldest outstanding positive amortization base of7
the system, excluding any amortization base established to amortize a liability8
established pursuant to Subparagraphs (2)(a) and (3)(c) of this Subsection, and9
without reamortization of such base.10
(II) Effective for the June 30, 2015, valuation and for each valuation11
thereafter, if the system's investment experience for the fiscal year exceeds the12
system's actuarial assumed rate of return, the system shall apply the excess13
investment experience returns, up to the first five million dollars for the June 30,14
2015, valuation, to the oldest outstanding positive amortization base of the system,15
excluding any amortization base established to amortize a liability established16
pursuant to Subparagraphs (2)(a) and (3)(c) of this Subsection. Upon complete17
liquidation of such amortization base, any remaining funds shall be applied to the18
next oldest outstanding positive amortization base until no further funds remain or19
all such bases are completely liquidated. Notwithstanding any provision of this20
Subsubitem to the contrary, the maximum amount of excess returns to be applied in21
any subsequent year pursuant to this Subsubitem shall equal the prior year's22
maximum amount increased by the percentage increase in the system's actuarial23
value of assets for the preceding year, if any. For any payment made pursuant to the24
provisions of this Subsubitem, if the system is eighty-five percent funded or greater25
prior to the application of the funds, the net remaining liability shall be reamortized26
over the remaining amortization period with annual payments calculated as provided27
in this Item; if the system is less than eighty-five percent funded prior to application28
of the funds, the net remaining liability shall not be reamortized after such29
application.30 ENROLLEDHB NO. 1225
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(cc) Effective for the June 30, 2019, system valuation and for each valuation1
thereafter, actuarial gains allocated to the experience account shall be amortized as2
a loss with level payments over a ten-year period.3
(dd) Notwithstanding any provision of this Item to the contrary, for the June4
30, 2014, valuation the amortization period for investment gains not allocated to the5
oldest outstanding positive amortization base pursuant to Subitem (bb) of this Item6
or credited to the experience account shall be five years.7
* * *8
§102.1. Consolidation of amortization payment schedules; Louisiana State9
Employees' Retirement System10
* * *11
B. Original amortization base.12
* * *13
(3)14
* * *15
(b) The first payment after this consolidation shall be made in Fiscal Year16
2010-2011 and the final payment in shall be made no later than Fiscal Year 2028-17
2029.18
(4)(a) In Except as provided in Paragraph (6) of this Subsection, in any year19
in which the system exceeds its actuarially-assumed rate of return, the first fifty20
million dollars of excess returns, up to the first fifty million for the June 30, 2015,21
valuation, shall be applied to the remaining balance of the original amortization base22
established in this Subsection. The maximum amount of excess returns to be applied23
in any subsequent year pursuant to the provisions of this Subparagraph shall equal24
the prior year's maximum amount increased by the percentage increase in the25
system's actuarial value of assets for the preceding year, if any.26
(b) After such application, the net remaining liability shall be reamortized27
over the remaining amortization period with annual payments calculated as provided28
in this Subsection or as otherwise provided by law. For any payment made pursuant29
to the provisions of this Paragraph, if the system is eighty-five percent funded or30 ENROLLEDHB NO. 1225
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greater prior to the application of the funds, the net remaining liability shall be1
reamortized over the remaining amortization period with annual payments calculated2
as provided in this Subsection or as otherwise provided by law; if the system is less3
than eighty-five percent funded prior to application of the funds, the net remaining4
liability shall not be reamortized after such application.5
(5) Notwithstanding the provisions of R.S. 11:102(B)(3)(c) and (5) or any6
other provision of law to the contrary, in any year through Fiscal Year 2016-2017 in7
which the system receives an overpayment of employer contributions as determined8
pursuant to R.S. 11:102(B)(2) and in any year through Fiscal Year 2016-2017 in9
which the system receives additional contributions pursuant to R.S. 11:102(B)(5),10
the amount of such overpayment or additional contribution shall be applied to the11
remaining balance of the original amortization base established pursuant to this12
Subsection. After such application, the net remaining liability shall be reamortized13
over the remaining amortization period with annual payments calculated as provided14
in this Subsection or as otherwise provided by law. For any payment made pursuant15
to the provisions of this Paragraph, if the system is eighty-five percent funded or16
greater prior to the application of the funds, the net remaining liability shall be17
reamortized over the remaining amortization period with annual payments calculated18
as provided in this Subsection or as otherwise provided by law; if the system is less19
than eighty-five percent funded prior to application of the funds, the net remaining20
liability shall not be reamortized after such application.21
(6) For the June 30, 2014, valuation, if the system exceeds its actuarially-22
assumed rate of return, the excess returns, up to the first twenty-five million dollars,23
shall be applied to the remaining balance of the original amortization base24
established in this Subsection, without reamortization of such base.25
C. Experience account amortization base.26
* * *27
(4)(a) In Except as provided in Paragraph (6) of this Subsection, in any year28
in which the excess returns of the system exceed the amount in Paragraph applied to29
the Original Amortization Base pursuant to Subparagraph (B)(4)(a) of this Section,30 ENROLLEDHB NO. 1225
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the remaining excess returns, up to the next fifty million dollars for the June 30,1
2015, valuation, of excess returns shall be applied to the experience account2
amortization base established in this Subsection. The maximum amount of excess3
returns to be applied in any subsequent year pursuant to the provisions of this4
Subparagraph shall equal the prior year's maximum amount increased by the5
percentage increase in the system's actuarial value of assets for the preceding year,6
if any.7
(b) After such application, the net remaining liability shall be reamortized8
over the remaining amortization period with annual payments calculated as provided9
in this Subsection or as otherwise provided by law. For any payment made pursuant10
to the provisions of this Paragraph, if the system is eighty-five percent funded or11
greater prior to the application of the funds, the net remaining liability shall be12
reamortized over the remaining amortization period with annual payments calculated13
as provided in this Subsection or as otherwise provided by law; if the system is less14
than eighty-five percent funded prior to application of the funds, the net remaining15
liability shall not be reamortized after such application.16
(5) Notwithstanding the provisions of R.S. 11:102(B)(3)(c) and (5) or any17
other provision of law to the contrary, in any year from Fiscal Year 2017-201818
through Fiscal Year 2039-2040 in which the system receives an overpayment of19
employer contributions as determined pursuant to R.S. 11:102(B)(2) and in any year20
from Fiscal Year 2017-2018 through Fiscal Year 2039-2040 in which the system21
receives additional contributions pursuant to R.S. 11:102(B)(5), the amount of such22
overpayment or additional contribution shall be applied to the remaining balance of23
the experience account amortization base established pursuant to this Subsection.24
After such application, the net remaining liability shall be reamortized over the25
remaining amortization period with annual payments calculated as provided in this26
Subsection or as otherwise provided by law. For any payment made pursuant to the27
provisions of this Paragraph, if the system is eighty-five percent funded or greater28
prior to the application of the funds, the net remaining liability shall be reamortized29
over the remaining amortization period with annual payments calculated as provided30 ENROLLEDHB NO. 1225
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in this Subsection or as otherwise provided by law; if the system is less than eighty-1
five percent funded prior to application of the funds, the net remaining liability shall2
not be reamortized after such application.3
(6) For the June 30, 2014, valuation, if the excess returns of the system4
exceed the amount applied to the original amortization base pursuant to5
Subparagraph (B)(6) of this Section, the remaining excess returns, up to the next6
twenty-five million dollars, shall be applied to the remaining balance of the7
experience account amortization base established in this Subsection, without8
reamortization of such base.9
§102.2. Consolidation of amortization payment schedules; Teachers' Retirement10
System of Louisiana11
* * *12
B. Original amortization base.13
* * *14
(3)15
* * *16
(b) The first payment shall be made in Fiscal Year 2010-2011 and the final17
payment in shall be made no later than Fiscal Year 2028-2029.18
(4)(a) In Except as provided in Paragraph (5) of this Subsection, in any year19
in which the system exceeds its actuarially-assumed rate of return, the first one20
hundred million dollars of excess returns, up to the first one hundred million dollars21
for the June 30, 2015, valuation, shall be applied to the remaining balance of the22
original amortization base established in this Subsection. The maximum amount of23
excess returns to be applied in any subsequent year pursuant to the provisions of this24
Subparagraph shall equal the prior year's maximum amount increased by the25
percentage increase in the system's actuarial value of assets for the preceding year,26
if any.27
(b) After such application, the net remaining liability shall be reamortized28
over the remaining amortization period with annual payments as provided in this29
Subsection or as otherwise provided by law. For any payment made pursuant to the30 ENROLLEDHB NO. 1225
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provisions of this Paragraph, if the system is eighty-five percent funded or greater1
prior to the application of the funds, the net remaining liability shall be reamortized2
over the remaining amortization period with annual payments calculated as provided3
in this Subsection or as otherwise provided by law; if the system is less than eighty-4
five percent funded prior to application of the funds, the net remaining liability shall5
not be reamortized after such application.6
(5) For the June 30, 2014, valuation, if the system exceeds its actuarially-7
assumed rate of return, the excess returns, up to the first fifty million dollars, shall8
be applied to the remaining balance of the original amortization base established in9
this Subsection, without reamortization of such base.10
C. Experience account amortization base.11
* * *12
(4)(a) In Except as provided in Paragraph (6) of this Subsection, in any year13
in which the excess returns of the system exceed the amount in Paragraph applied to14
the Original Amortization Base pursuant to Subparagraph (B)(4)(a) of this Section,15
the remaining excess returns, up to the next one hundred million dollars for the June16
30, 2015, valuation, of excess returns shall be applied to the experience account17
amortization base established in this Subsection. The maximum amount of excess18
returns to be applied in any subsequent year pursuant to the provisions of this19
Subparagraph shall equal the prior year's maximum amount increased by the20
percentage increase in the system's actuarial value of assets for the preceding year,21
if any.22
(b) After such application, the net remaining liability shall be reamortized23
over the remaining amortization period with annual payments calculated as provided24
in this Subsection or as otherwise provided by law. For any payment made pursuant25
to the provisions of this Paragraph, if the system is eighty-five percent funded or26
greater prior to the application of the funds, the net remaining liability shall be27
reamortized over the remaining amortization period with annual payments calculated28
as provided in this Subsection or as otherwise provided by law; if the system is less29 ENROLLEDHB NO. 1225
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than eighty-five percent funded prior to application of the funds, the net remaining1
liability shall not be reamortized after such application.2
(5) Notwithstanding the provisions of R.S. 11:102(B)(3)(c) and (5) or any3
other provision of law to the contrary, in any year from Fiscal Year 2009-20104
through Fiscal Year 2039-2040 in which the system receives an overpayment of5
employer contributions as determined pursuant to R.S. 11:102(B)(2) and in any year6
from Fiscal Year 2009-2010 through Fiscal Year 2039-2040 in which the system7
receives additional contributions pursuant to R.S. 11:102(B)(5), the amount of such8
overpayment or additional contribution shall be applied to the remaining balance of9
the experience account amortization base established pursuant to this Subsection.10
After such application, the net remaining liability shall be reamortized over the11
remaining amortization period with annual payments calculated as provided in this12
Subsection or as otherwise provided by law. For any payment made pursuant to the13
provisions of this Paragraph, if the system is eighty-five percent funded or greater14
prior to the application of the funds, the net remaining liability shall be reamortized15
over the remaining amortization period with annual payments calculated as provided16
in this Subsection or as otherwise provided by law; if the system is less than eighty-17
five percent funded prior to application of the funds, the net remaining liability shall18
not be reamortized after such application.19
(6) For the June 30, 2014, valuation, if the excess returns of the system20
exceed the amount applied to the original amortization base pursuant to21
Subparagraph (B)(5) of this Section, the remaining excess returns, up to the next fifty22
million dollars, shall be applied to the remaining balance of the experience account23
amortization base established in this Subsection, without reamortization of such24
base.25
§102.3. Review of volatility26
Following the close of Fiscal Year 2018-2019, the future volatility of the27
then-existing schedules of each state system shall be reexamined by staff of each28
system and of the legislature, including actuaries for both. The results of this29
reexamination, which may identify issues to be resolved and include30 ENROLLEDHB NO. 1225
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are additions.
recommendations for plan amendments, shall be reported to the Public Retirement1
Systems' Actuarial Committee by November 1, 2019. The committee shall review2
the results and determine what changes to the system plan provisions, if any, are3
advisable. If appropriate, the committee shall make a recommendation to the4
legislature on whether and what type of legislation is warranted.5
* * *6
§542. Experience account7
A.8
* * *9
(2) The experience account shall be credited as follows:10
(a) To the extent permitted by Paragraph (3) of this Subsection and after11
allocation to the consolidated amortization bases as provided in R.S. 11:102.1 R.S.12
11:102(B)(3)(d)(v)(bb) and 102.1, as applicable, an amount not to exceed fifty13
percent of the remaining balance of the prior year's net investment experience gain14
as determined by the system's actuary.15
(b) To the extent permitted by Paragraph (3) of this Subsection, an amount16
not to exceed that portion of the system's net investment income attributable to the17
balance in the experience account during the prior year.18
(3)(a) In no event shall the amount a credit be made to the account that19
would cause the balance in the experience account to exceed the reserve necessary20
to grant:21
(i) Two two permanent benefit increases as provided in determined pursuant22
to Subsection C of this Section if the system is eighty percent funded or greater.23
(ii) One permanent benefit increase as determined pursuant to Subsection C24
of this Section if the system is less than eighty percent funded.25
(b) If the system is less than eighty percent funded and has reserves in excess26
of the amounts provided for in Item (a)(ii) of this Paragraph, it shall not apply credits27
to the account pursuant to Subparagraph (2)(b) of this Subsection.28
* * *29 ENROLLEDHB NO. 1225
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are additions.
C.(1) In accordance with the provisions of this Section, the board of trustees1
may recommend to the president of the Senate and the speaker of the House of2
Representatives that the system be permitted to grant a permanent benefit increase3
to retirees, survivors, and beneficiaries whenever the conditions in Subsection F of4
this Section are satisfied and the balance in the experience account is sufficient to5
fund such benefit fully on an actuarial basis, as determined by the system's actuary.6
If the legislative auditor's actuary disagrees with the determination of the system's7
actuary, a permanent benefit increase shall not be granted. The board of trustees8
shall not grant a permanent benefit increase unless such permanent benefit increase9
has been approved by the legislature. by concurrent resolution adopted by the10
favorable vote of a majority of the elected members of each house. Any such11
permanent benefit increase granted on or before June 30, 2015, shall be limited to12
and shall only be payable based on an amount not to exceed seventy thousand dollars13
of the retiree's annual benefit. Any such permanent benefit increase granted on or14
after July 1, 2015, shall be limited to and shall only be payable based on an amount15
not to exceed sixty thousand dollars of the retiree's annual benefit. ; however,16
effective Effective for years after July 1, 1999, and on or before June 30, 2015, the17
seventy-thousand dollar limit shall be increased each year in an amount equal to any18
increase in the consumer price index (U.S. city average for all urban consumers19
(CPI-U)) for the preceding year, if any. Effective on or after July 1, 2015, the sixty-20
thousand dollar limit shall be increased each year in an amount equal to any increase21
in the consumer price index, (U.S. city average for all urban consumers (CPI-U)) for22
the twelve-month period ending on the system's valuation date, if any. Any increase23
granted pursuant to the provisions of this Subsection Section shall begin on the July24
first following legislative approval, shall be payable annually, and shall equal an25
amount not to exceed be an amount equal to the lesser of:26
(a) Three percent.(b) An amount as determined in Paragraph (2) of this27
Subsection.28
(b)(2) If the The increase in the consumer price index, U.S. city average for29
all urban consumers (CPI-U), as prepared by the U.S. Department of Labor, Bureau30 ENROLLEDHB NO. 1225
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are additions.
of Labor Statistics, for the twelve-month period ending on the system's valuation1
date calendar year immediately preceding the permanent benefit increase is less than2
three percent, then the permanent benefit increase shall be a sum equal to the CPI-U3
increase for that prior calendar year, if any. If the balance in the experience account4
is not sufficient to fund that sum, no increase shall be granted.5
(2)(a) If the system is eighty percent funded or greater, three percent.6
(b) If the system is at least seventy-five percent funded but less than eighty7
percent funded and the legislature has not granted a benefit increase in the preceding8
fiscal year, two and one-half percent.9
(c) If the system is at least sixty-five percent funded but less than seventy-10
five percent funded and the legislature has not granted a benefit increase in the11
preceding fiscal year, two percent.12
(d) If the system is at least fifty-five percent funded but less than sixty-five13
percent funded and the legislature has not granted a benefit increase in the preceding14
fiscal year, one and one-half percent.15
(e) If the system is less than fifty-five percent funded or if the system is less16
than eighty-five percent funded but more than fifty-five percent funded and the17
legislature granted a benefit increase in the preceding fiscal year, no increase shall18
be granted.19
(3) The Subject to the limitations contained in Paragraph (1) of this20
Subsection, the percentage of each recipient's permanent benefit increase shall be21
based on the benefit being paid to the recipient on the effective date of the increase.22
* * *23
F.(1) The permanent benefit increase which is authorized by Subsection C24
of this Section shall be limited to the lesser of either two percent or an amount as25
determined in Paragraph (C)(2) Subsection C of this Section in or for any year in26
which the system does not earn an actuarial rate of return of at least eight and one-27
quarter percent interest on the investment of the system's assets.28
* * *29 ENROLLEDHB NO. 1225
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are additions.
G.(1) Notwithstanding any provision of this Section to the contrary, in a year1
in which the experience account balance is insufficient to fund the amount required2
pursuant to Paragraph (C)(1) of this Section, the board may make the3
recommendation provided in Paragraph (C)(1) of this Section if all of the following4
conditions are satisfied:5
(a) No benefit increase was granted in the preceding fiscal year.6
(b) The experience account balance established in the system valuation for7
the preceding fiscal year reached its maximum reserve permitted pursuant to8
Paragraph (A)(3) of this Section applicable to the system valuation for that valuation9
year.10
(c) The experience account balance established in the system valuation for11
the current fiscal year is insufficient to fund the maximum increase permitted12
pursuant to Paragraph (C)(2) of this Section applicable to the system valuation for13
the preceding fiscal year.14
(d) All of the insufficiency in the account is attributable to the following:15
(i) The growth of the cost of the increase, but only if that growth was16
produced solely by either or both of these events:17
(aa) Changes in the pool of the eligible recipients.18
(bb) The growth in the benefit amount to which the increase applies due to19
the application of the CPI-U pursuant to the provisions of Paragraph (C)(1) of this20
Section.21
(ii) Credits to the account, if any, are insufficient to cover the growth in the22
cost of the increase.23
(2) The amount of the increase shall be equal to the amount the balance in24
the experience account will fully fund rounded to the nearest lower one-tenth of one25
percent.26
* * *27
§883.1. Experience account28
A.29
* * *30 ENROLLEDHB NO. 1225
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are additions.
(2) The experience account shall be credited as follows:1
(a) To the extent permitted by Paragraph (3) of this Subsection and after2
allocation to the consolidated amortization bases as provided in R.S. 11:102.2 R.S.3
11:102(B)(3)(d)(vii)(bb) and 102.2, as applicable, an amount not to exceed fifty4
percent of the remaining balance of the prior year's net investment experience gain5
as determined by the system's actuary.6
(b) To the extent permitted by Paragraph (3) of this Subsection, an amount7
not to exceed that portion of the system's net investment income attributable to the8
balance in the experience account during the prior year.9
(3)(a) In no event shall the amount a credit be made to the account that10
would cause the balance in the experience account to exceed the reserve necessary11
to grant either of the following:12
(i) Two two permanent benefit increases as provided in determined pursuant13
to Subsection C of this Section if the system is eighty percent funded or greater.14
(ii) One permanent benefit increase as determined pursuant to Subsection C15
of this Section if the system is less than eighty percent funded.16
(b) If the system is less than eighty percent funded and has reserves in excess17
of the amounts provided for in Item (a)(ii) of this Paragraph, it shall not apply credits18
to the account pursuant to Subparagraph (2)(b) of this Subsection.19
* * *20
C.(1) In accordance with the provisions of this Section, the board of trustees21
may recommend to the president of the Senate and the speaker of the House of22
Representatives that the system be permitted to grant a permanent benefit increase23
to retirees and beneficiaries whenever the conditions in Subsection G of this Section24
are satisfied and the balance in the experience account is sufficient to fund such25
benefit fully on an actuarial basis, as determined by the system's actuary. If the26
legislative auditor's actuary disagrees with the determination of the system's actuary,27
a permanent benefit increase shall not be granted. The board of trustees shall not28
grant a permanent benefit increase unless such permanent benefit increase has been29
approved by the legislature. by concurrent resolution adopted by a favorable vote of30 ENROLLEDHB NO. 1225
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are additions.
a majority of the elected members of each house. Any increase granted pursuant to1
the provisions of this Section shall begin on the July first following legislative2
approval, shall be payable annually, and shall equal an amount not to exceed be an3
amount equal to the lesser of:4
(a) Three percent.(b) An amount as determined in Paragraph (2) of this5
Subsection.6
(2)(b) If the The increase in the consumer price index, U.S. city average for7
all urban consumers (CPI-U), as prepared by the U.S. Department of Labor, Bureau8
of Labor Statistics, for the twelve-month period ending on the system's valuation9
date calendar year immediately preceding the permanent benefit increase is less than10
three percent, then the permanent benefit increase shall be a sum equal to the CPI-U11
increase for that prior calendar year, if any. If the balance in the experience account12
is not sufficient to fund that sum, no increase shall be granted.13
(2)(a) If the system is eighty percent funded or greater, three percent.14
(b) If the system is at least seventy-five percent funded but less than eighty15
percent funded and the legislature has not granted a benefit increase in the preceding16
fiscal year, two and one-half percent.17
(c) If the system is at least sixty-five percent funded but less than seventy-18
five percent funded and the legislature has not granted a benefit increase in the19
preceding fiscal year, two percent.20
(d) If the system is at least fifty-five percent funded but less than sixty-five21
percent funded and the legislature has not granted a benefit increase in the preceding22
fiscal year, one and one-half percent.23
(e) If the system is less than fifty-five percent funded or if the system is less24
than eighty-five percent funded but more than fifty-five percent funded and the25
legislature granted a benefit increase in the preceding fiscal year, no increase shall26
be granted.27 ENROLLEDHB NO. 1225
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(3) The Subject to the limitations contained in Subsection F of this Section,1
the percentage of each recipient's permanent benefit increase shall be based on the2
benefit being paid to the recipient on the effective date of the increase.3
* * *4
F.(1) Notwithstanding any other provisions of this Section to the contrary,5
any permanent benefit increase granted on or before June 30, 2015, shall be6
calculated only on the first seventy thousand dollars of the retiree's annual retirement7
benefit. (2) The This seventy-thousand dollar limit provided for in Paragraph (1)8
of this Subsection shall be increased each year in an amount equal to any increase9
in the consumer price index, U.S. city average for all urban consumers (CPI-U) for10
the preceding year, if any.11
(2) Notwithstanding any other provisions of this Section to the contrary, any12
permanent benefit increase granted on or after July 1, 2015, shall be calculated only13
on the first sixty thousand dollars of the retiree's annual retirement benefit. This14
sixty-thousand dollar limit shall be increased each year in an amount equal to any15
increase in the consumer price index, U.S. city average for all urban consumers (CPI-16
U) for the immediately preceding one-year period ending in June, if any.17
G.(1) The permanent benefit increase which is authorized by Subsection C18
of this Section shall be limited to the lesser of either two percent or an amount as19
determined in Paragraph (C)(2) Subsection C of this Section in or for any year in20
which the system does not earn an actuarial rate of return of at least eight and one-21
quarter percent interest on the investment of the system's assets.22
* * *23
H.(1) Notwithstanding any provision of this Section to the contrary, in a year24
in which the experience account balance is insufficient to fund the amount required25
pursuant to Paragraph (C)(1) of this Section, the board may make the26
recommendation provided in Paragraph (C)(1) of this Section if all of the following27
conditions are satisfied:28
(a) No benefit increase was granted in the preceding fiscal year.29 ENROLLEDHB NO. 1225
Page 24 of 34
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are additions.
(b) The experience account balance established in the system valuation for1
the preceding fiscal year reached its maximum reserve permitted pursuant to2
Paragraph (A)(3) of this Section applicable to the system valuation for that valuation3
year.4
(c) The experience account balance established in the system valuation for5
the current fiscal year is insufficient to fund the maximum increase permitted6
pursuant to Paragraph (C)(2) of this Section applicable to the system valuation for7
the preceding fiscal year.8
(d) All of the insufficiency in the account is attributable to the following:9
(i) The growth of the cost of the increase, but only if that growth was10
produced solely by either or both of these events:11
(aa) Changes in the pool of the eligible recipients.12
(bb) The growth in the benefit amount to which the increase applies due to13
the application of the CPI-U pursuant to the provisions of Paragraph (C)(1) of this14
Section.15
(ii) Credits to the account, if any, are insufficient to cover the growth in the16
cost of the increase.17
(2) The amount of the increase shall be equal to the amount the balance in18
the experience account will fully fund rounded to the nearest lower one-tenth of one19
percent.20
* * *21
§1145.1. Employee Experience Account22
A.(1) The Employee Experience Account shall be credited as follows:23
(a) To the extent permitted by Paragraph (2) of this Subsection and after24
allocation as provided in R.S. 11:102(B)(3)(d)(vi)(bb), an amount not to exceed fifty25
percent of the prior year's net investment experience gain as determined by the26
system's actuary.27
(b) To the extent permitted by Paragraph (2) of this Subsection, an amount28
not to exceed that portion of the system's net investment income attributable to the29
balance in the Employee Experience Account during the prior year.30 ENROLLEDHB NO. 1225
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are additions.
(2)(a) In no event shall the amount a credit be made to the account that1
would cause the balance in the Employee Experience Account to exceed the reserve2
necessary to grant :3
(i) Two two cost-of-living adjustments determined pursuant to Subsection4
C of this Section if the system is eighty percent funded or greater.5
(ii) One permanent benefit increase as determined pursuant to Subsection C6
of this Section if the system is less than eighty percent funded.7
(b) If the system is less than eighty percent funded and has reserves in excess8
of the amounts provided for in Item (a)(ii) of this Paragraph, it shall not apply credits9
to the account pursuant to Subparagraph (1)(b) of this Subsection.10
* * *11
C.(1) In accordance with the provisions of this Section, the board of trustees12
may recommend to the president of the Senate and the speaker of the House of13
Representatives that the system be permitted to grant a cost-of-living adjustment to14
retirees and beneficiaries whenever the conditions in this Section are satisfied and15
the balance in the Employee Experience Account is sufficient to fully fund such16
benefit on an actuarial basis, as determined by the system's actuary. If the legislative17
actuary disagrees with the determination of the system's actuary, a cost-of-living18
adjustment shall not be granted. The board of trustees shall not grant a cost-of-living19
adjustment as provided in this Subsection unless such cost-of-living adjustment has20
been approved by the legislature. by concurrent resolution adopted by the favorable21
vote of a majority of the elected members of each house. Any such cost-of-living22
adjustment granted on or before June 30, 2015, shall be limited to and shall only be23
payable based on an amount not to exceed eighty-five thousand dollars of the24
retiree's annual benefit. Any such cost-of-living adjustment granted on or after July25
1, 2015, shall be limited to and shall only be payable based on an amount not to26
exceed sixty thousand dollars of the retiree's annual benefit.; however, effective27
Effective for years after July 1, 2007, and on or before June 30, 2015, the eighty-five28
thousand dollar limit shall be increased each year in an amount equal to the increase29
in the Consumer Price Index (United States city average for all urban consumers30 ENROLLEDHB NO. 1225
Page 26 of 34
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are additions.
(CPI-U)), as prepared by the United States Department of Labor, Bureau of Labor1
Statistics, for the preceding calendar year, if any. Effective on or after July 1, 2015,2
the sixty-thousand dollar limit shall be increased each year in an amount equal to any3
increase in the consumer price index (U.S. city average for all urban consumers4
(CPI-U)) for the twelve-month period ending on the system's valuation date, if any.5
Any cost-of-living adjustment granted pursuant to the provisions of this Subsection6
Section shall begin on July first following legislative approval, shall be payable7
annually, and shall equal an amount not to exceed be an amount equal to the lesser8
of:9
(a) Three percent.(b) An amount as determined in Paragraph (2) of this10
Subsection.11
(b)(2) If the The increase in the Consumer Price Index (United States city12
average for all urban consumers (CPI-U)), as prepared by the United States13
Department of Labor, Bureau of Labor Statistics, for the twelve-month period ending14
on the system's valuation date calendar year immediately preceding the cost-of-living15
adjustment is less than three percent, then the cost-of-living adjustment shall be a16
sum equal to the CPI-U increase for that prior calendar year, if any. If the balance17
in the experience account is not sufficient to fund that sum, no increase shall be18
granted.19
(2)(a) If the system is eighty percent funded or greater, three percent.20
(b) If the system is at least seventy-five percent funded but less than eighty21
percent funded and the legislature has not granted a benefit increase in the preceding22
fiscal year, two and one-half percent.23
(c) If the system is at least sixty-five percent funded but less than seventy-24
five percent funded and the legislature has not granted a benefit increase in the25
preceding fiscal year, two percent.26
(d) If the system is at least fifty-five percent funded but less than sixty-five27
percent funded and the legislature has not granted a benefit increase in the preceding28
fiscal year, one and one-half percent.29 ENROLLEDHB NO. 1225
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are additions.
(e) If the system is less than fifty-five percent funded or if the system is less1
than eighty-five percent funded but more than fifty-five percent funded and the2
legislature granted a benefit increase in the preceding fiscal year, no increase shall3
be granted.4
(3) The Subject to the limitations contained in Paragraph (1) of this5
Subsection, the percentage of each recipient's cost-of-living adjustment shall be6
based on the benefit being paid to the recipient on the effective date of the increase.7
* * *8
D. The cost-of-living increase which is authorized by Subsection C of this9
Section shall be limited to the lesser of either two percent or an amount determined10
as provided in Paragraph (C)(2) Subsection C of this Section in or for any year in11
which the system does not earn the required actuarial rate of return as certified by the12
system's actuary. an actuarial rate of return of at least seven and one-quarter percent13
interest on the investment of the system's assets.14
* * *15
F.(1) Notwithstanding any provision of this Section to the contrary, in a year16
in which the experience account balance is insufficient to fund the amount required17
pursuant to Paragraph (C)(1) of this Section, the board may make the18
recommendation provided in Paragraph (C)(1) of this Section if all of the following19
conditions are satisfied:20
(a) No benefit increase was granted in the preceding fiscal year.21
(b) The experience account balance established in the system valuation for22
the preceding fiscal year reached its maximum reserve permitted pursuant to23
Paragraph (A)(3) of this Section applicable to the system valuation for that valuation24
year.25
(c) The experience account balance established in the system valuation for26
the current fiscal year is insufficient to fund the maximum increase permitted27
pursuant to Paragraph (C)(2) of this Section applicable to the system valuation for28
the preceding fiscal year.29
(d) All of the insufficiency in the account is attributable to the following:30 ENROLLEDHB NO. 1225
Page 28 of 34
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are additions.
(i) The growth of the cost of the increase, but only if that growth was1
produced solely by either or both of these events:2
(aa) Changes in the pool of the eligible recipients.3
(bb) The growth in the benefit amount to which the increase applies due to4
the application of the CPI-U pursuant to the provisions of Paragraph (C)(1) of this5
Section.6
(ii) Credits to the account, if any, are insufficient to cover the growth in the7
cost of the increase.8
(2) The amount of the increase shall be equal to the amount the balance in9
the experience account will fully fund rounded to the nearest lower one-tenth of one10
percent.11
* * *12
§1332. Employee Experience Account13
A.(1) The Employee Experience Account shall be credited as follows:14
(a) To the extent permitted by Paragraph (2) of this Subsection and after the15
allocation as provided in R.S. 11:102(B)(3)(d)(viii)(bb), an amount not to exceed16
fifty percent of the prior year's net investment experience gain as determined by the17
system's actuary.18
(b) To the extent permitted by Paragraph (2) of this Subsection, an amount19
not to exceed that portion of the system's net investment income attributable to the20
balance in the Employee Experience Account during the prior year.21
(2)(a) In no event shall the amount a credit be made to the account that22
would cause the balance in the Employee Experience Account to exceed the reserve23
necessary to grant :24
(i) Two two cost-of-living adjustments determined pursuant to Subsection25
C of this Section if the system is eighty percent funded or greater.26
(ii) One permanent benefit increase as determined pursuant to Subsection C27
of this Section if the system is less than eighty percent funded.28 ENROLLEDHB NO. 1225
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(b) If the system is less than eighty percent funded and has reserves in excess1
of the amounts provided for in Item (a)(ii) of this Paragraph, it shall not apply credits2
to the account pursuant to Subparagraph (1)(b) of this Subsection.3
* * *4
C.(1) In accordance with the provisions of this Section, the board of trustees5
may recommend to the president of the Senate and the speaker of the House of6
Representatives that the system be permitted to grant a cost-of-living adjustment to7
retirees and beneficiaries whenever the conditions in this Section are satisfied and8
the balance in the Employee Experience Account is sufficient to fully fund such9
benefit on an actuarial basis, as determined by the system's actuary. If the legislative10
actuary disagrees with the determination of the system's actuary, a cost-of-living11
adjustment shall not be granted. The board of trustees shall not grant a cost-of-living12
adjustment as provided in this Subsection unless such cost-of-living adjustment has13
been approved by the legislature. by concurrent resolution adopted by the favorable14
vote of a majority of the elected members of each house. Any such cost-of-living15
adjustment granted on or before June 30, 2015, shall be limited to and shall only be16
payable based on an amount not to exceed eighty-five thousand dollars of the17
retiree's annual benefit. Any such cost-of-living adjustment granted on or after July18
1, 2015, shall be limited to and shall only be payable based on an amount not to19
exceed sixty thousand dollars of the retiree's annual benefit. ; however, effective20
Effective for years after July 1, 2007, and on or before June 30, 2015, the eighty-five21
thousand dollar limit shall be increased each year in an amount equal to the increase22
in the Consumer Price Index consumer price index (United States city average for23
all urban consumers (CPI-U)), as prepared by the United States Department of24
Labor, Bureau of Labor Statistics, for the preceding calendar year, if any. Effective25
on or after July 1, 2015, the sixty-thousand dollar limit shall be increased each year26
in an amount equal to any increase in the consumer price index (U.S. city average27
for all urban consumers (CPI-U)) for the twelve-month period ending on the system's28
valuation date, if any. Any adjustment granted pursuant to the provisions of this29
Subsection Section shall begin on July first following legislative approval, shall be30 ENROLLEDHB NO. 1225
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are additions.
payable annually, and shall equal an amount not to exceed be an amount equal to the1
lesser of:2
(a) Three percent.(b) An amount as determined in Paragraph (2) of this3
Subsection.4
(b)(2) If the The increase in the Consumer Price Index consumer price index5
(United States city average for all urban consumers (CPI-U)), as prepared by the6
United States Department of Labor, Bureau of Labor Statistics, for the twelve-month7
period ending on the system's valuation date calendar year immediately preceding8
the cost-of-living adjustment is less than three percent, then the cost-of-living9
adjustment shall be a sum equal to the CPI-U increase for that prior calendar year,10
if any. If the balance in the experience account is not sufficient to fund that sum, no11
increase shall be granted.12
(2)(a) If the system is eighty percent funded or greater, three percent.13
(b) If the system is at least seventy-five percent funded but less than eighty14
percent funded and the legislature has not granted a benefit increase in the preceding15
fiscal year, two and one-half percent.16
(c) If the system is at least sixty-five percent funded but less than seventy-17
five percent funded and the legislature has not granted a benefit increase in the18
preceding fiscal year, two percent.19
(d) If the system is at least fifty-five percent funded but less than sixty-five20
percent funded and the legislature has not granted a benefit increase in the preceding21
fiscal year, one and one-half percent.22
(e) If the system is less than fifty-five percent funded or if the system is less23
than eighty-five percent funded but more than fifty-five percent funded and the24
legislature granted a benefit increase in the preceding fiscal year, no increase shall25
be granted.26
(3) The Subject to the limitations contained in Paragraph (1) of this27
Subsection, the percentage of each recipient's cost-of-living adjustment shall be28
based on the benefit being paid to the recipient on the effective date of the increase.29
* * *30 ENROLLEDHB NO. 1225
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D. The cost-of-living increase which is authorized by Subsection C of this1
Section shall be limited to the lesser of either two percent or an amount determined2
as provided in Paragraph (C)(2) Subsection C of this Section in or for any year in3
which the system does not earn the required actuarial rate of return as certified by the4
system's actuary. an actuarial rate of return of at least seven percent interest on the5
investment of the system's assets.6
* * *7
F. In addition to the cost-of-living adjustment authorized by Subsection C8
of this Section, the board of trustees may grant a supplemental cost-of-living9
adjustment to all retirees and beneficiaries who are at least age sixty-five, which10
shall consist of an amount equal to two percent of the benefit being received on the11
date of the adjustment. In order to grant such supplemental cost-of-living12
adjustment, the board of trustees shall recommend to the president of the Senate and13
the speaker of the House of Representatives that the system be permitted to grant14
such supplemental cost-of-living adjustment to retirees and beneficiaries whenever15
the balance in the Employee Experience Account is sufficient to fully fund such16
benefit on an actuarial basis, as determined by the system's actuary. If the legislative17
actuary disagrees with the determination of the system's actuary, such supplemental18
cost-of-living adjustment shall not be granted. The board of trustees shall not grant19
such supplemental cost-of-living adjustment as provided in this Subsection unless20
such supplemental cost-of-living adjustment has been approved by the legislature.21
by concurrent resolution adopted by the favorable vote of a majority of the elected22
members of each house. Any such supplemental cost-of-living adjustment paid on23
or before June 30, 2015, shall be limited to and shall only be payable based on an24
amount not to exceed eighty-five thousand dollars of the retiree's annual benefit.25
Any such supplemental cost-of-living adjustment paid on or after July 1, 2015, shall26
be limited to and shall only be payable based on an amount not to exceed sixty27
thousand dollars of the retiree's annual benefit. ; however, effective Effective on and28
for years after July 1, 2007, and on or before June 30, 2015, the eighty-five thousand29
dollar limit shall be increased each year in an amount equal to the increase in the30 ENROLLEDHB NO. 1225
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are additions.
Consumer Price Index consumer price index (United States city average for all urban1
consumers (CPI-U)), as prepared by the United States Department of Labor, Bureau2
of Labor Statistics, for the preceding calendar year, if any. Effective on and after3
July 1, 2015, the sixty-thousand dollar limit shall be increased each year in an4
amount equal to the increase in the consumer price index (United States city average5
for all urban consumers (CPI-U)), as prepared by the United States Department of6
Labor, Bureau of Labor Statistics, for the twelve-month period ending on the7
system's valuation date, if any. Any cost-of-living adjustment granted pursuant to the8
provisions of this Subsection shall begin on July first following legislative approval9
and shall be payable annually.10
G.(1) Notwithstanding any provision of this Section to the contrary, in a year11
in which the experience account balance is insufficient to fund the amount required12
pursuant to Paragraph (C)(1) of this Section, the board may make the13
recommendation provided in Paragraph (C)(1) of this Section if all of the following14
conditions are satisfied:15
(a) No benefit increase was granted in the preceding fiscal year.16
(b) The experience account balance established in the system valuation for17
the preceding fiscal year reached its maximum reserve permitted pursuant to18
Paragraph (A)(3) of this Section applicable to the system valuation for that valuation19
year.20
(c) The experience account balance established in the system valuation for21
the current fiscal year is insufficient to fund the maximum increase permitted22
pursuant to Paragraph (C)(2) of this Section applicable to the system valuation for23
the preceding fiscal year.24
(d) All of the insufficiency in the account is attributable to the following:25
(i) The growth of the cost of the increase, but only if that growth was26
produced solely by either or both of these events:27
(aa) Changes in the pool of the eligible recipients.28 ENROLLEDHB NO. 1225
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(bb) The growth in the benefit amount to which the increase applies due to1
the application of the CPI-U pursuant to the provisions of Paragraph (C)(1) of this2
Section.3
(ii) Credits to the account, if any, are insufficient to cover the growth in the4
cost of the increase.5
(2) The amount of the increase shall be equal to the amount the balance in6
the experience account will fully fund rounded to the nearest lower one-tenth of one7
percent.8
Section 2.(A) Notwithstanding any provision to the contrary of R.S. 11:542(A)(2)(a),9
883.1(A)(2)(a), 1145.1(A)(1)(a), or 1332(A)(1)(a), as amended by this Act, for the June 30,10
2014, valuation, for the purposes of determining excess returns to be credited to the11
experience account, each system shall exclude only the following sum from its calculation12
of net investment experience gain:13
(1) Louisiana State Employees' Retirement System: the first one hundred million14
dollars of excess investment experience returns.15
(2) Teachers' Retirement System of Louisiana: the first two hundred million dollars16
of excess investment experience returns.17
(3) Louisiana School Employees' Retirement System: the first fifteen million dollars18
of excess investment experience returns.19
(4) State Police Retirement System: the first five million dollars of excess20
investment experience returns.21
(B) Any restriction in such provisions of law, as amended by this Act, on the total22
amount of assets authorized to be credited to the account is hereby expressly retained.23
Section 3. The systems shall each prepare and present to the House and Senate24
committees on retirement a report on the administrative and actuarial processes that will be25
applied in the implementation of this Act. The reports shall be submitted to the committees26
no later than November 14, 2014.27
Section 4. The provisions of Sections 1, 2, and 3 of this Act shall become effective28
if and when the Acts which originated as Senate Bill Nos. 16, 18, 19, and 21 of the 201429
Regular Session of the Legislature of Louisiana become effective.30 ENROLLEDHB NO. 1225
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are additions.
Section 5. The provisions of this Section and Section 4 of this Act shall become1
effective on June 30, 2014; if this Act is vetoed by the governor and subsequently approved2
by the legislature, the provisions of this Section and Section 4 of this Act shall become3
effective on June 30, 2014, or on the day following such approval by the legislature,4
whichever is later.5
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: