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Regular Session, 2014
HOUSE BILL NO. 1278 (Substitute for House Bill No. 79 by Representative Pearson)
BY REPRESENTATIVE PEARSON
RETIREMENT/STATE EMPS: Provides for enrollment of new hires of the Harbor Police
Department of the Port of New Orleans in the Hazardous Duty Services Plan in the
La. State Employees' Retirement System and for merger of the existing Harbor
Police Retirement System into the La. State Employees' Retirement System
AN ACT1
To amend and reenact R.S. 11:102(C)(1)(l) and (4)(b), 612(introductory paragraph), 613(A),2
615(B), 3681, 3682(1), (2), (4)(a), (7), (16), (18) through (20), and (26),3
3683(introductory paragraph), (1), and (3)(b), 3684(A), (D), and (F), 3685(A)(1)(a)4
and (2)(introductory paragraph) and (d), (B)(1), (3) through (6), and (8), (C)(1), (2),5
and (13), and (E), 3685.2(B)(introductory paragraph), (6) and (7), 3686(B)(1),6
(D)(3), and (E), 3688(D), 3688.1, 3690(A) and (B), 3690.2, 3692(A), and7
3695(C)(introductory paragraph), to enact R.S. 11:102(C)(1)(m), 612(2.1), 620.1,8
Subpart E of Part VII of Chapter 1 of Subtitle II of Title 11 of the Louisiana Revised9
Statutes of 1950, comprised of R.S. 11:631, and 3682(20.1), and to repeal R.S.10
11:3682(29), 3685(D), 3688(A) through (C) and (E), 3689(B) through (E), 3690 (C)11
and (D), 3690.1, 3691, 3693, and 3698, relative to retirement for employees of the12
Harbor Police Department of the Port of New Orleans; to provide relative to the13
merger of the Harbor Police Retirement System into the Louisiana State Employees'14
Retirement System; to provide for enrollment of new hires of the Harbor Police15
Department in the Hazardous Duty Services Plan in the Louisiana State Employees'16
Retirement System; to provide relative to a cooperative endeavor agreement with17
respect to the merger of the systems; to provide relative to the assets of the Harbor18
Police Retirement System; to provide relative to benefits for members of the Harbor19 HLS 14RS-3532 ORIGINAL
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Police Retirement System; to provide relative to retirement benefits for new hires of1
the Harbor Police Department of the Port of New Orleans; to provide relative to the2
boards of trustees of the Louisiana State Employees' Retirement System and the3
Harbor Police Retirement System; to provide an effective date; and to provide for4
related matters.5
Notice of intention to introduce this Act has been published6
as provided by Article X, Section 29(C) of the Constitution7
of Louisiana.8
Be it enacted by the Legislature of Louisiana:9
Section 1. R.S. 11:612(introductory paragraph), 613(A), 615(B), 3682(16) and10
3683(1) are hereby amended and reenacted and R.S. 11:612(2.1) is hereby enacted to read11
as follows:12
§612. Application; definitions13
Terms not specifically defined in this Section but defined in R.S. 11:403 shall14
have the meanings provided in R.S. 11:403 unless a different meaning is clearly15
required by the context. For purposes of this Subpart:16
* * *17
(2.1) In addition to the definition provided in Paragraph (2) of this Section,18
the term "member" shall include any commissioned employee of the Harbor Police19
Department of the Port of New Orleans first hired on or after July 1, 2014.20
* * *21
§613. Eligibility for plan membership22
A. Each person who becomes an employee in state service in one of the23
positions defined in R.S. 11:612(2) or (2.1) shall become a member of the Hazardous24
Duty Services Plan of the system as a condition of employment.25
* * *26
§615. Retirement benefit calculation27
* * *28 HLS 14RS-3532 ORIGINAL
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B. If the member's last ten years of creditable service were not accrued1
exclusively in one of the hazardous duty positions defined in R.S. 11:612(2) or (2.1),2
he shall receive a retirement benefit equal to two and one-half percent of his average3
compensation for the actual number of years of creditable service earned in a4
hazardous duty position.5
* * *6
§3682. Definitions7
The following words and phrases, as used in this Subpart, unless expressly8
indicated to the contrary or unless a different meaning is plainly required by context,9
shall have the following meanings:10
* * *11
(16) "Employee" means any commissioned member or employee of the12
Harbor Police Department of the Port of New Orleans prior to July 1, 2004, or any13
commissioned member of the Harbor Police Department of the Port of New Orleans14
on or after July 1, 2004 and hired on or before June 30, 2014.15
* * *16
§3683. Membership17
The membership of the retirement system shall be composed as follows:18
(1) All persons who shall become employees as defined in R.S. 11:3682(16)19
after August 1, 1971, and on or before June 30, 2014, except those specifically20
excluded under Paragraph (3) of this Section, shall become members as a condition21
of their employment, provided they are under fifty years of age at the date of22
employment.23
* * *24
Section 2. R.S. 11:102(C)(1)(l) and (4)(b), 3681, 3682(1), (2), (4)(a), (7), (18)25
through (20), and (26), 3683(introductory paragraph) and (3)(b), 3684(A), (D), and (F),26
3685(A)(1)(a) and (2)(introductory paragraph) and (d),(B)(1), (3) through (6), and (8),27
(C)(1), (2), and (13), and (E), 3685.2(B)(introductory paragraph), (6) and (7), 3686(B)(1),28
(D)(3), and (E), 3688(D), 3688.1, 3690(A) and (B), 3690.2, 3692(A), and29 HLS 14RS-3532 ORIGINAL
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3695(C)(introductory paragraph) are hereby amended and reenacted and R.S.1
11:102(C)(1)(m), 620.1, Subpart E of Part VII of Chapter 1 of Subtitle II of Title 11 of the2
Louisiana Revised Statutes of 1950, comprised of R.S. 11:631, and 3682(20.1) are hereby3
enacted to read as follows:4
§102. Employer contributions; determination; state systems5
* * *6
C.(1) This Subsection shall be applicable to the Louisiana State Employees'7
Retirement System effective for the June 30, 2010, system valuation and beginning8
Fiscal Year 2011-2012. For purposes of this Subsection, "plan" or "plans" shall9
mean a subgroup within the system characterized by the following employee10
classifications:11
* * *12
(l) Harbor Police Retirement Plan members as provided pursuant to R.S.13
11:631.14
(m) Any other specialty retirement plan provided for a subgroup of system15
members. If the legislation enacting such a plan is silent as to the application of this16
Subsection, the Public Retirement Systems' Actuarial Committee shall provide for17
the application to such plan.18
* * *19
(4) For each plan referenced in Paragraph (1) of this Subsection, the20
legislature shall set the required employer contribution rate equal to the sum of the21
following:22
* * *23
(b) The shared unfunded accrued liability rate. (i) Except as provided in24
Item (ii) of this Subparagraph, a A single rate shall be computed for each fiscal year,25
applicable to all plans for actuarial changes, gains, and losses existing on June 30,26
2010, or occurring thereafter, including experience and investment gains and losses,27
which are independent of the existence of the plans listed in Paragraph (1) of this28 HLS 14RS-3532 ORIGINAL
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Subsection, the payment and rate therefor shall be calculated as provided in1
Paragraphs (B)(1) and (3) of this Section.2
(ii) The shared unfunded accrued liability rate applicable to the Harbor3
Police Retirement System shall not include any unfunded accrued liability incurred4
on or before July 1, 2015, until the earlier of:5
(aa) July 1, 2022.6
(bb) The date that all sums payable by the Port of New Orleans to the board7
of trustees of the Louisiana State Employees' Retirement System pursuant to the8
terms and conditions of a cooperative endeavor agreement between the board of9
trustees of the Louisiana State Employees' Retirement System, the board of10
commissioners of the Port of New Orleans, and the board of trustees of the Harbor11
Police Retirement System regarding the merger of the Harbor Police Retirement12
System into the Louisiana State Employees' Retirement System have been paid in13
full.14
* * *15
§620.1. Transfer of other service credit; Harbor Police Retirement Plan employees16
A. Any member of the Harbor Police Retirement Plan who would otherwise17
be eligible for benefits under this plan except that his first employment making him18
eligible for membership in the Harbor Police Retirement Plan occurred on or before19
June 30, 2014, and who has not participated in the Deferred Retirement Option Plan20
in the Harbor Police Retirement Plan shall have the right to irrevocably elect to21
become a member of this plan by submitting an application to the board of trustees22
to become effective on or after July 1, 2015.23
B. Any eligible member who elects to transfer to the Hazardous Duty24
Services Plan from the Harbor Police Retirement Plan shall have the option of:25
(1) Maintaining prior service credit in the Harbor Police Retirement Plan26
pursuant to the provisions of that plan and accruing service credit and benefits in the27
Hazardous Duty Services Plan after the date he joins the plan. If such election28 HLS 14RS-3532 ORIGINAL
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results in an actuarial cost to this system, the member shall pay the system the1
amount of such actuarial cost prior to his retirement.2
(2)(a) An internal actuarial transfer from the Harbor Police Retirement Plan3
to this plan in accordance with the provisions of R.S. 11:143(C) and (D) in which the4
member transfers all of his service credit from the Harbor Police Retirement Plan5
and maintains prior service credit at the accrual rate at which it was earned in such6
plan prior to joining the Hazardous Duty Services Plan. If the amount of funds7
transferred is less than the actuarial cost of the service transferred, the member8
transferring, except as otherwise provided in this Section, shall pay the deficit or9
difference, including the interest thereon at the board-approved actuarial valuation10
rate of the system.11
(b) In lieu of paying the deficit or difference plus interest, the member may,12
at his option but only at the time of transfer, be granted an amount of credit in this13
plan which is based on the amount of funds actually transferred plus any additional14
funds less than the deficit paid by the member.15
(c) A member who completes a transfer under the provisions of this16
Paragraph shall have his retirement benefit calculated using the accrual rate of the17
plan from which he transferred based on the number of years transferred.18
C. A member whose first employment making him eligible for membership19
in the Harbor Police Retirement Plan occurred on or before June 30, 2015, who20
elects to join this plan shall thereafter for purposes of all state retirement systems be21
treated as an employee whose membership is governed by the provisions of Act No.22
992 of the 2010 Regular Session of the Legislature.23
* * *24
SUBPART E. HARBOR POLICE RETIREMENT PLAN25
§631. Administration of the Harbor Police Retirement Plan26
A. With the exception of payment of permanent benefit increases,27
membership and benefits for the Harbor Police Retirement Plan shall be in28
accordance with the provisions of Subpart G of Part II of Chapter 3 of Subtitle IV of29 HLS 14RS-3532 ORIGINAL
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Title 11 of the Louisiana Revised Statutes of 1950; however, if provisions of this1
Chapter cover matters not specifically addressed by the provisions of Subpart G of2
Part II of Chapter 3 of Subtitle IV of Title 11 of the Louisiana Revised Statutes of3
1950, the provisions of this Chapter shall apply to that plan. The provisions of4
Subpart G of Part II of Chapter 3 of Subtitle IV of Title 11 of the Louisiana Revised5
Statutes of 1950 are hereby made a part of this system. Eligibility for and payment6
of permanent benefit increases for members of the plan shall be governed by the laws7
and rules of this system.8
B. Notwithstanding any provision of law to the contrary, upon the merger9
of the Harbor Police Retirement System with this system, the assets of the Harbor10
Police Retirement System shall become part of the Louisiana State Employees'11
Retirement System trust and shall be managed in accordance with the laws governing12
this system.13
* * *14
SUBPART G. HARBOR POLICE RETIREMENT SYSTEM PLAN (PORT OF NEW15
ORLEANS) IN THE LOUISIANA STATE EMPLOYEES' RETIREMENT SYSTEM16
§3681. Name and date of establishment 17
A. A retirement system plan is hereby established and placed under the18
management of the Board of Trustees for the purpose of providing retirement19
allowances and other benefits under the provisions of this Subpart for Commissioned20
Members of the Harbor Police Department of the Port of New Orleans hired on or21
before June 30, 2014. The retirement system so created shall be established as of the22
first day of August nineteen hundred and seventy-one.23
B. It shall have the power and the privileges of a corporation and shall be24
known as the "Harbor Police Retirement System" and by such name all of its25
business shall be transacted, all of its funds invested and all of its cash and securities26
and other property held.27
§3682. Definitions28 HLS 14RS-3532 ORIGINAL
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The following words and phrases, as used in this Subpart, unless expressly1
indicated to the contrary or unless a different meaning is plainly required by context,2
shall have the following meanings:3
(1) "Accumulated contribution" means the sum of all the amounts deducted4
from the compensation of a member and credited to his individual account in the5
Annuity Savings Fund Employee Savings Account established in R.S. 11:532,6
together with regular interest thereon as provided in R.S. 11:3688.7
(2) "Actuarial equivalent" means a benefit of equivalent value to the8
accumulated contributions, annuity, or benefits, as the case may be, computed upon9
the basis of such interest and mortality assumptions as are adopted in accordance10
with the provisions of R.S. 11:3688(D) by the board or provided in law.11
* * *12
(4)(a) "Average compensation" for the limited purpose of applying Section13
415(b) of the Internal Revenue Code, means the average compensation earned by a14
member for the period of three consecutive years during which the member was an15
active member of the retirement system plan and had the greatest aggregate16
compensation from the employer.17
* * *18
(7) "Board of trustees" or "board" means the board provided for in R.S.19
11:3688 to administer the retirement system R.S. 11:511.20
* * *21
(18) "Medical board" means the board of physicians provided for in R.S.22
11:3688 R.S. 11:403.23
(19) "Member" includes any employees, as defined in Paragraph (16) of this24
Section, included in the membership of this system plan as provided in R.S. 11:3683.25
(20) "Membership service" means service as an employee while a member26
of the Harbor Police Retirement System or this system plan.27 HLS 14RS-3532 ORIGINAL
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(20.1) "Plan" means the Harbor Police Retirement Plan established in this1
Subpart and administered as a plan within the Louisiana State Employees'2
Retirement System pursuant to R.S. 11:631.3
* * *4
(26) "Retirement system" or "system" means the Harbor Police Retirement5
System as established in R.S. 11:3681 Louisiana State Employees' Retirement6
System.7
* * *8
§3683. Membership9
The membership of the retirement system plan shall be composed as follows:10
* * *11
(3)12
* * *13
(b) Any employee who is employed on July 7, 2003, who has retired from14
service under any retirement system of this state partly or wholly financed by public15
funds, who is receiving retirement benefits therefrom, and who was prohibited from16
becoming a member of this system upon his initial employment solely on this basis17
shall become a member of this system plan from the date of his initial employment18
provided he meets all other eligibility requirements; however, any such employee19
may purchase credit for previous service only in compliance with the provisions of20
R.S. 11:158 relating to actuarial calculation of purchase price.21
* * *22
§3684. Creditable service23
A. Immediately after the establishment of the system August 1, 1971, the24
board of trustees shall request all information regarding members from the retirement25
system in which they have previously held membership. Upon verification of the26
statements of service the board shall issue a prior service certificate certifying to27
each member the length of prior service for which credit shall have been allowed on28
the basis of these certified statements of service. So long as membership continues29 HLS 14RS-3532 ORIGINAL
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a prior service certificate shall be final and conclusive for retirement purposes as to1
such service, provided that any member may, within one year from the date of2
issuance or modification of such certificate, request the board of trustees to modify3
or correct his prior service certificate.4
* * *5
D. Anything in this Subpart to the contrary notwithstanding, any person who6
shall have been an employee as defined in R.S. 11:3682(16) any time subsequent to7
September 16, 1940, who shall have entered the armed forces of the United States8
during time of war or have been inducted into said forces in time of peace9
subsequent to said date, shall be entitled to prior service credit for the period that he10
served in the armed forces of the United States, not to exceed four years, provided11
he is not granted credit for such service in any other retirement system, and provided12
he becomes a member of this system on the date of its establishment August 1, 1971.13
* * *14
F. Any member who has terminated membership in the system plan for any15
reason and has withdrawn his contributions and who later is reemployed and16
becomes a member of the system, shall after eighteen months of additional service17
and membership, be eligible to obtain credit for his prior service in the system,18
provided that he pay back into the system the amount of the contributions which had19
been refunded to him plus compound interest from the date of the refund until the20
date of repurchase. The compound interest rate to be used in the computation of the21
amount the member must pay back into the system shall be the actuarially assumed22
interest rate in the most recent actuarial valuation.23
* * *24
§3685. Benefits25
A.(1)(a) Any member of this system plan who has completed at least twenty26
years of creditable service and attained the age of forty-five years, or any member27
who has completed at least twenty-five years of creditable service regardless of age,28
or any member who has completed at least ten years of service and attained the age29 HLS 14RS-3532 ORIGINAL
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of sixty years, or any member who has completed at least twelve years of creditable1
service and has attained the age of fifty-five years, shall be entitled to retire from2
service and upon such retirement shall be paid a retirement allowance equal to three3
and one-third percent of his average final compensation multiplied by his years of4
creditable service, not to exceed one hundred percent of his final salary.5
* * *6
(2) Benefits shall be payable to survivors of a deceased member , with who7
had at least five years of creditable service, and who dies before retirement as8
specified in the following:9
* * *10
(d)(i) If a member dies leaving no surviving spouse or children, his mother11
and/or his father who were dependent upon him as their sole means of support shall12
be paid monthly benefits equal to forty percent of the average final compensation of13
the member prior to his death.14
(ii) If a deceased member leaves a surviving child who has a total physical15
disability or mental disability, the child, regardless of age, shall be entitled to the16
benefits for children under eighteen years of age pursuant to Subparagraph (c) or (e)17
of this Paragraph if the child had a total physical disability or mental disability at the18
time of the death of the member, and the child is dependent upon his legal guardian19
for subsistence. The legal guardian shall provide adequate proof of physical or20
mental disability of such a surviving child and shall notify the board of any21
subsequent changes in the child's condition that cause the child to no longer be22
dependent upon the legal guardian and of any changes in the assistance being23
received from other state agencies. The board may require a certified statement of24
the child's eligibility status at the end of each calendar year.25
* * *26
B. The provisions of this Subsection shall apply to those persons enrolled in27
the deferred retirement option plan prior to July 1, 1995.28 HLS 14RS-3532 ORIGINAL
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(1) In lieu of terminating employment and accepting a service retirement1
under this Subpart, any member of this system plan who has not less than twenty2
years of creditable service and who is eligible to receive a service retirement3
allowance may elect to participate in a deferred retirement option plan as provided4
for below and defer the receipt of benefits in accordance with the provisions of this5
Section.6
* * *7
(3) The duration of participation in the deferred retirement option plan shall8
be specified and shall not exceed five years.9
(4) A member may participate in the deferred retirement option plan only10
once.11
(5) Upon the effective date of the commencement of participation in the12
deferred retirement option plan, active membership in the system shall terminate.13
Employer contributions shall continue to be payable by the employer during the14
member's participation in the such plan, but payment of employee contributions shall15
cease upon the effective date of the member's commencement of participation in the16
such plan. For purposes of this Section, compensation and creditable service shall17
remain as they existed on the effective date of commencement of participation in the18
deferred retirement option plan. The monthly retirement benefits that would have19
been payable, had the member elected to cease employm ent and receive a service20
retirement allowance, shall be paid into the deferred retirement option plan account.21
Upon termination of employment, deferred benefits shall be payable as provided by22
Paragraph (B)(8).23
(6) The deferred retirement option plan account shall earn interest not to24
exceed two percent less than the realized rate of investment return earned by the fund25
for that year. A Prior to July 1, 2015, a person who participates in this program shall26
have credited to his DROP account the same annual cost of living increase that he27
would have received had the member been a retiree in the system as provided in28
Subsection C of this Section.29 HLS 14RS-3532 ORIGINAL
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* * *1
(8) Upon termination of employment at the end of the specified period of2
participation, a participant in the program shall receive, at his option, a lump sum3
payment from the account equal to the payment to the account; or a true annuity4
based upon his account; or he may elect any other method of payment if approved5
by the board of trustees. In the event a member elects to receive a true annuity, or6
any other method of payment approved by the board of trustees, funds will be7
transferred from the DROP account into the Annuity Reserve Account Retiree's8
Annuity Reserve account to provide for the annuity payments.9
* * *10
C. The provisions of this Subsection shall apply to those persons enrolled in11
the Deferred Retirement Option Plan on or after July 1, 1995.12
(1) As governed by the provisions of this Subsection, there exists as a part13
of this retirement system plan, an optional account known as the Deferred14
Retirement Option Plan, which may be cited as the "DROP".15
(2) The provisions of this Subsection are applicable with respect to those16
otherwise eligible members of the retirement system plan whose election to17
participate in the this DROP occurs on or after July 1, 1995.18
* * *19
(13) The Deferred Retirement Option Plan Account shall not earn interest20
during the period of participation. However, the board of trustees shall annually set21
a percentage rate, and its manner of compounding, to represent the interest rate that22
would be earned thereby if same did earn interest. If the member ceases employment23
at the end of the specified period of participation as contractually agreed, or dies24
during or at the end of the specified period of participation as contractually agreed,25
a sum equal to the amount the individual account would have earned, if the26
representative interest rate, as compounded, had been applicable to such account,27
shall be added to this account. Thereafter, the account, if maintained as otherwise28
authorized by this Subsection, shall earn interest at a rate compounded, as set29 HLS 14RS-3532 ORIGINAL
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annually by the board of trustees. Such actual rate of interest and manner of1
compounding shall be equal to the representative rate and compounding in effect for2
the same period of time. If the member does not abide by the terms of the contract3
and cease employment at the end of the period of participation as contractually4
agreed, payments into the Deferred Retirement Option Plan Account shall5
immediately cease and the member shall immediately be paid a lump sum payment6
from the member's individual account balance in the Deferred Retirement Option7
Plan Account equal to its balance, without the addition of any sum representing8
interest, and such member's account shall be terminated. Such member shall not be9
considered as retired, but shall remain as a member of the retirement system, in an10
inactive status. Only upon actual cessation of employment shall the member be11
considered as a retiree and entitled to the receipt of retirement benefits. This account12
shall not be subject to any fees or charges of any kind for any purpose, except as13
otherwise provided herein.14
* * *15
E. The benefits provided in this Section shall not be retroactive to any16
period. Further adjustments in benefits may be made each January July first after at17
least a full year has elapsed after benefits began, subject to the limitations contained18
herein.19
* * *20
§3685.2. Computation of retirement benefits21
* * *22
B. The annual retirement benefit of any member of the retirement system23
plan who is not a qualified participant, as defined by Paragraph (2) of Subsection A24
(A)(2) of this Section, and which is not attributable to the member's after-tax25
employee contribution, cannot exceed the lesser of ninety thousand dollars or one26
hundred percent of such member's average compensation. For purposes of27
determining whether a member's benefit exceeds those limitations, the following28
shall apply:29 HLS 14RS-3532 ORIGINAL
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* * *1
(6) Adjustment for less than ten years of participation or service.2
(a) If retirement system benefits are payable under this retirement system3
plan to a member who has less than ten years of participation in the retirement4
system plan, the dollar limitation referred to in the Introductory Paragraph of this5
Subsection shall be multiplied by a fraction, the numerator of which is the member's6
number of years of participation in the system plan, not greater than ten, and the7
denominator of which is ten.8
(b) If retirement benefits are payable under this retirement system plan to a9
member who has less than ten years of service with the employer, the percentage10
limitation referred to in the Introductory Paragraph of this Subsection and the dollar11
limitation referred to in Paragraph (9) of this Subsection shall be multiplied by a12
fraction, the numerator of which is the member's number of years of service with the13
employer, not greater than ten, and the denominator of which is ten.14
(7) Annual adjustment. The ninety thousand dollar limitation provided in15
this Subsection shall be adjusted annually to the maximum dollar limits allowable16
by the secretary of the Treasury of the United States under Section 415(d) of the17
Internal Revenue Code, such adjustments to take effect on the first day of each fiscal18
year following December 31, 1987. The adjustment shall not exceed the adjustment19
in effect for the calendar year in which the fiscal year of the system begins. The20
adjusted earlier limitation is applicable to employees who are members of the system21
plan and to members who have retired or otherwise terminated their service under22
the system plan with a nonforfeitable right to accrued benefits, regardless of whether23
they have actually begun to receive benefits. This system shall be considered24
specifically to provide for such post-retirement adjustments. For any limitation year25
beginning after separation from service occurs, the annual adjustment factor is a26
fraction, the numerator of which is the adjusted dollar limitation for the limitation27
year in which the compensation limitation is being adjusted and the denominator of28
which is the adjusted dollar limitation for the limitation year in which the member29 HLS 14RS-3532 ORIGINAL
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separated from service. No adjustment shall be permitted with respect to post1
October 14, 1987, limitations.2
* * *3
§3686. Disability retirement4
* * *5
B.(1) Upon retirement for disability, a member shall receive a retirement6
allowance if he has attained the age of fifty-five years; otherwise, he shall receive a7
disability benefit which shall be computed as follows: 8
(a) In case of total disability of any harbor member resulting from injury9
received in line of duty, a monthly pension of sixty percent of his average salary10
shall be paid to the disabled employee.11
(b) Any member of the system plan who has become disabled or12
incapacitated because of continued illness or as a result of any injury received, even13
though not in the line of duty, and who has been a member of the system plan for at14
least five years but is not eligible for retirement under the provisions of R.S. 11:368515
may apply for retirement under the provisions of this Section.16
(c) Any disability beneficiary of the Harbor Police Retirement System Plan17
who is receiving disability benefits as a result of an injury sustained in the line of18
duty, and who, as a result of the disability, is permanently and completely confined19
to a wheelchair for movement of person, is permanently and legally blind as a result20
of an injury suffered in the line of duty, or as a result of his injury is an amputee to21
such a degree as would prevent him from serving as a law enforcement officer, shall22
be exempt from any provision of this Subpart or any other provision of law which23
provides for reduction of benefits if the recipient, subsequent to his disability,24
becomes gainfully employed.25
* * *26
D.27
* * *28 HLS 14RS-3532 ORIGINAL
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(3) Should a disability beneficiary under the age of fifty-five be restored to1
active service at a compensation not less than his average final compensation, his2
retirement allowance shall cease, he shall again become a member of the retirement3
system plan, and he shall contribute thereafter at the same rate he paid prior to4
disability. Any such prior service certificate on the basis of which his service was5
computed at the time of his retirement shall be restored to full force and effect, and6
in addition, upon his subsequent retirement he shall be credited with all his service7
as a member but should he be restored to active service on or after the attainment of8
the age of fifty years his pension upon subsequent retirement shall not exceed the9
sum of the pension which he was receiving immediately prior to his last restoration10
and the pension that he would have received on account of his service since his last11
restoration had he entered service at the time as a new entrant.12
E. Should a member cease to be an employee except by death or retirement13
under the provisions of this Subpart, he shall be paid such part of the amount of the14
accumulated contributions standing to the his credit of his individual account in the15
Annuity Savings Fund Employees' Savings Account established in R.S. 11:532 as16
he shall demand. Should a member die before retirement and not be entitled to17
survivors' benefits, the amount of his accumulated contributions standing to the his18
credit of his individual in such account shall be paid to his estate or to such person19
as he shall have nominated by written designation, duly executed and filed with the20
Board of Trustees.21
* * *22
§3688. Administration Actuary; duties and actuarial assumptions23
D. Actuary; duties and actuarial assumptions. (1) The Board of Trustees24
and the Board of Commissioners of the Port of New Orleans shall jointly designate25
an actuary who shall be the technical advisor of the Board of Trustees on actuarial26
matters regarding the operation of the fund plan created by the provisions of this27
Subpart, and shall perform such other duties as are required in connection therewith.28 HLS 14RS-3532 ORIGINAL
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(2) The Board of Trustees shall adopt all actuarial tables, assumptions, and1
rates. The actuary shall make valuations and determinations based on such tables,2
assumptions, and rates.3
(3) At least once in each five-year period, and upon approval of the Board4
of Trustees, the actuary shall make an actuarial investigation into the mortality,5
service and compensation experience of the members and beneficiaries of the6
retirement system. The Board of Trustees shall adopt for the retirement system such7
mortality, service, and other tables and actuarial assumptions as shall be deemed8
necessary.9
(4) On the basis of such tables and actuarial assumptions as the Board of10
Trustees shall adopt, the actuary shall make an annual valuation of the assets and11
liabilities of the funds of the system created by this Subpart.12
(5)(a) Unless different actuarial assumptions are formally adopted and13
disclosed, the following assumptions shall be used in determining actuarial14
equivalents:15
(i) Interest shall be compounded annually at the rate of seven percent per16
annum.17
(ii) Annuity rates shall be determined on the basis of the most current18
mortality table recommended by the Society of Actuaries for retirement systems.19
(iii) Effective July 1, 2011, interest for calculating transfers into the Harbor20
Police Retirement System and for buying back refunded service shall be eight and21
one-quarter percent per annum.22
(b) The Board of Trustees may authorize the use of interest and mortality23
rates in determining the actuarial equivalents which are different from the actuarial24
assumptions used for other purposes in this Subpart. Any change in such actuarial25
assumptions shall be considered a part of this retirement system plan and shall be26
considered an amendment to the provisions of this Section. In order to be effective,27
such change must be formally adopted by the Board of Trustees and disclosed to28
members of the retirement system plan.29 HLS 14RS-3532 ORIGINAL
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§3688.1. Amendments1
A. An action of the board of trustees with respect to cost-of-living2
adjustments as provided in R.S. 11:3685(D), employee contributions as provided in3
R.S. 11:154, and actuarial assumptions as provided in R.S. 11:3688(D), shall be4
considered amendments to the provisions of this retirement system plan.5
B. No amendment to this the retirement system or plan shall operate to6
deprive any member of a benefit to which he is already entitled. In the case of any7
merger or consolidation with, or transfer of assets or liabilities to, any other8
retirement system, each member in the retirement system will, if the retirement9
system is then terminated, receive a benefit immediately after the merger,10
consolidation, or transfer equal to or greater than the benefit he would have been11
entitled to receive immediately before the merger, consolidation, or transfer, if the12
retirement system had then terminated. 13
C. Upon the termination or partial termination of the retirement system or14
upon the discontinuance of contributions by the employer without formal termination15
of the retirement system, the board of trustees shall reevaluate and redetermine the16
benefit of each member in accordance with law, and the entire benefit of each17
member may be paid or commence to be paid and distributed to such member, or in18
the case of his death before such distribution, to the beneficiary or beneficiaries19
designated by such member, or may be held until payment otherwise due under the20
provisions of the retirement system. A member's right to his benefit is not21
conditioned upon a sufficiency of plan assets in the event of termination.22
* * *23
§3690. Method of financing24
A. Employee contributions. (1) The port commission shall make deductions25
from any salary or wages paid by them to any member of this fund plan equal to nine26
percent of the compensation paid him in each and every payroll.27
(2) The deductions provided for herein shall be made notwithstanding that28
the minimum compensation provided for by law for any member shall be reduced29 HLS 14RS-3532 ORIGINAL
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thereby. Every member shall be deemed to consent and agree to the deductions1
made and provided for herein and shall receipt for his full salary or compensation,2
and payment of salary or compensation less said deductions shall be a full and3
complete discharge and acquittance of all claims and demands whatsoever for the4
services rendered by such person during the period covered by such payment, except5
as to the benefits provided under this Subpart. The employer shall certify to the6
board of trustees on each and every payroll or in such other manner as the board may7
prescribe, the amounts to be deducted; and each of said amounts shall be deducted,8
and when deducted shall be paid into said Annuity Savings Fund the Employees'9
Savings Account established in R.S. 11:532, and shall be credited to the individual10
account of the member from whose compensation said deduction was made.11
B. Employer contributions. (1) The port commission shall annually12
contribute an amount equal to the rate per centum determined herein in accordance13
with Paragraphs (2) and (3) of this Subsection calculated pursuant to R.S. 11:102. 14
Contributions shall be made monthly based on the same salary or wages used to15
calculate the members' contributions.16
(2) The normal contribution rate shall be the rate per centum of the earned17
salary of all members obtained by deducting from the total liabilities of the fund the18
amount of the funds in hand to the credit of the fund and dividing the remainder by19
one percentum of the present value of the prospective future salaries of all members20
as computed on the basis of the mortality and service tables adopted by the board of21
trustees and interest as set forth in R.S. 11:3688(D)(5)(a)(i). The normal rate of22
contributions shall be determined by the actuary after each valuation.23
(3) The maximum contribution by the employer, Board of Commissioners24
of the Port of New Orleans, shall not exceed twenty percent of the earned25
compensation of the members in any one year. There shall be no contribution by26
employer other than the percentage of earned compensation of the members as27
provided in this Subpart, and subject to the maximum stated above, even in the event28
that the payment by employer should not be sufficient, when combined with the29 HLS 14RS-3532 ORIGINAL
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amount in the fund, to provide the retirement allowances and other benefits payable1
out of the fund.2
* * *3
§3690.2. Unclaimed funds, checks, and property; retention by system4
Any unclaimed employee contributions, other funds, checks, or any other5
property held by this the system that could be claimed by a member or prior member,6
the member's beneficiary, heirs, or estate shall never be presumed abandoned and7
shall be held continuously by the system for the benefit of such member, prior8
member, the member's beneficiary, heirs, or estate.9
§3692. Protection against fraud 10
A. Any persons who shall knowingly make any false statement or shall11
falsify or permit to be falsified any record or records of this the retirement system in12
any attempt to defraud such system as a result of such act shall be guilty of a13
misdemeanor, and on conviction thereof by any court of competent jurisdiction shall14
be punished by a fine not exceeding five hundred dollars or imprisonment in the15
parish jail not exceeding twelve months, or both such fine and imprisonment at the16
discretion of the court.17
* * *18
§3695. Direct rollover19
* * *20
C. An For the purposes of this Section, an "eligible retirement plan" shall21
mean any of the following:22
* * *23
Section 3. R.S. 11:3682(29), 3685(D), 3688(A) through (C) and (E), 3689(B)24
through (E), 3690(C) and (D), 3690.1, 3691, 3693, and 3698 are hereby repealed in their25
entirety.26
Section 4.(A) The board of trustees of the Louisiana State Employees’ Retirement27
System, the board of commissioners of the Port of New Orleans, and the board of trustees28
of the Harbor Police Retirement System shall execute a cooperative endeavor agreement for29 HLS 14RS-3532 ORIGINAL
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the merger of the Harbor Police Retirement System into the Louisiana State Employees’1
Retirement System.2
(B) Any cooperative endeavor agreement executed pursuant to this Section shall3
include provisions regarding the following:4
(1) Rights of current participants in the Harbor Police Retirement System:5
(a) Current participants in the Harbor Police Retirement System, including retirees6
and active members, shall retain all accrued benefits and shall continue to accrue benefits7
under the terms of the Harbor Police Retirement System plan, as specified in R.S. 11:36818
through 3698, except with respect to cost-of-living adjustments which shall be governed by9
the laws and rules of the Louisiana State Employees' Retirement System.10
(b) Active members the Harbor Police Retirement System who have not participated11
in the Deferred Retirement Option Plan may join the Louisiana State Employees’ Retirement12
System Hazardous Duty Services Plan and exercise the option to transfer prior service credit13
using the procedures set out in R.S. 11:620.1.14
(2) Liabilities of the Harbor Police Retirement System:15
(a) The Port of New Orleans shall agree to pay to the board of trustees of the16
Louisiana State Employees’ Retirement System sums sufficient to fund all of the accrued17
liability of the Harbor Police Retirement System determined using the Louisiana State18
Employees’ Retirement System actuarial assumptions.19
(b) The liabilities shall be paid under such terms and conditions as agreed to by the20
parties and shall include interest at the Louisiana State Employees’ Retirement System21
actuarially assumed rate of return as approved by the Public Retirement Systems' Actuarial22
Committee.23
(C) Any cooperative endeavor agreement executed pursuant to this Section shall be24
provided to the House and Senate Committees on Retirement by October 1, 2014.25
Section 5. The cost of this Act, if any, shall be funded with additional employer26
contributions in compliance with Article X, Section 29(F) of the Constitution of Louisiana.27
Section 6.(A) The provisions of this Section and Sections 1, 4, and 5 of this Act shall28
become effective on June 30, 2014.29 HLS 14RS-3532 ORIGINAL
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(B) The provisions of Sections 2 and 3 of this Act shall become effective July 1,1
2015, if the house and senate committees on retirement approve the terms of the cooperative2
endeavor agreement provided for in Section 4 of this Act on or before December 31, 2014.3
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Pearson HB No. 1278
Abstract: Provides for enrollment of new hires of the Harbor Police Department of the Port
of New Orleans in the Hazardous Duty Services Plan in the La. State Employees'
Retirement System (LASERS) and for merger of the existing Harbor Police
Retirement System (HBPOL) into LASERS.
NEW EMPLOYEES OF THE HARBOR POLI CE DEPARTMENT OF THE PORT OF
NEW ORLEANS
Present law establishes the Hazardous Duty Services Plan in LASERS. Such members
receive a 3.33% accrual rate, have an employee contribution rate of 9.5%, and have the
following retirement eligibilities:
(1)Twenty-five years or more of service, at any age.
(2)Twelve years or more of service, at age fifty-five or thereafter.
(3)Twenty years of service credit at any age, actuarially reduced from age 55.
Proposed law retains present law.
Present law provides that any commissioned member of the Harbor Police Department of
the Port of New Orleans on or after July 1, 2004, shall be a member of HBPOL. Proposed
law retains present law for all commissioned members hired on or before June 30, 2014.
Proposed law places any commissioned employee of the Harbor Police Department of the
Port of New Orleans first hired on or after July 1, 2014, in the Hazardous Duty Services Plan
in LASERS.
MEMBERS OF THE HARBOR POLI CE RETIREMENT SYSTEM AS OF
JUNE 30, 2014
Present law establishes HBPOL as a local retirement system to provide for the retirement
of commissioned members and employees of the Harbor Police Department of the Port of
New Orleans prior to July 1, 2004, and for the retirement of commissioned members of the
police department after July 1, 2004. Proposed law abolishes HBPOL as an independent
retirement system and recreates it as a plan (hereafter referred to as the "HBPOL Plan")
within LASERS.
Present law provides for the administration of the HBPOL by a board of trustees comprised
of active, retired, and ex officio members. Proposed law repeals the HBPOL board of
trustees upon the effective date of the merger of the systems. Further provides that the
HBPOL Plan shall be administered by the LASERS board.
Present law authorizes the board of HBPOL to provide cost-of-living adjustments (COLAs)
to retirees whenever the system experiences excess returns above what is actuarially HLS 14RS-3532 ORIGINAL
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required. Proposed law provides that future COLAs for HBPOL retirees and HBPOL Plan
retirees shall be calculated and granted in the same manner as COLAs for LASERS retirees
and beneficiaries.
Proposed law authorizes active members of the HBPOL Plan to transfer service credit to the
Hazardous Duty Services Plan of LASERS. Requires the member to pay any actuarial cost,
calculated in accordance with present law, for such service transfers.
Present law for HBPOL provides for payment benefits to surviving spouses and children of
members. Proposed law for the HBPOL Plan changes the categories of people who may
receive such benefits. Proposed law provides that a surviving totally physically or mentally
disabled child, regardless of age, who is dependent on a legal guardian for subsistence is
entitled to receive benefits. Requires the legal guardian to notify the board if the child
becomes independent or if there are any changes in the assistance being received from other
state agencies. Further requires the legal guardian to provide proof of the child's physical or
mental disability. Authorizes the board to require a certified statement of the child's
eligibility for the survivor benefit at the end of each calendar year.
EMPLOYER CONTRIBUTION RATES
Present law provides that employer contribution rates for HBPOL are capped at 20% of the
earned compensation of the members in any one year. Provides that no further sums must
be transferred to the retirement system in the event the payment from the employer is not
sufficient to provide the retirement allowances and other benefits payable from the fund.
Proposed law repeals present law. Requires employer contribution rates after the merger of
the systems to be calculated in accordance with present law governing LASERS.
Present law, relative to LASERS employer contribution rates, provides for particularized
contribution rates for plans within LASERS, such as the Hazardous Duty Services Plan.
Proposed law provides for particularized contribution rates for the HBPOL Plan.
Present law for LASERS provides that part of the employer contribution rate is an amount
to cover "shared" unfunded liabilities of the system. Such "shared" liability is comprised of
two elements: (1) the unfunded liabilities of the system existing as of June 30, 2010, and
(2) the unfunded liabilities system accrued after June 30, 2010, that are independent of the
existence of the plans within LASERS (for example, losses incurred if the system does not
achieve its actuarial assumed rate of return).
Proposed law provides that the HBPOL Plan contribution rate shall not include any shared
UAL incurred on or before July 1, 2015 until the earlier of:
(1)July 1, 2022.
(2)The date all sums owed to LASERS by the Port of New Orleans pursuant to the
terms and conditions of the cooperative endeavor agreement provided for in
proposed law are paid in full.
ASSETS OF THE SYSTEM
Present law provides for the merger of HBPOL assets into the LASERS trust. Requires such
funds to be managed in accordance with LASERS law.
COOPERATIVE ENDEAVOR AGREEMENT
Proposed law authorizes the boards of trustees of LASERS, HBPOL, and the board of
commissioners of the Port of New Orleans to enter into a cooperative endeavor agreement
for HBPOL to merge into LASERS. Provides requirements relative to the rights of HBPOL
members and the liabilities of the system that shall be contained in such cooperative HLS 14RS-3532 ORIGINAL
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endeavor agreement. Requires submission of the cooperative endeavor agreement to the
House and Senate Committees on Retirement by Oct. 1, 2014.
Provisions relating to the merger of HBPOL into LASERS become effective July 1, 2015,
if the house and senate committees on retirement approve the terms of the cooperative
endeavor agreement authorized pursuant to proposed law.
All other provisions, including enrollment of new hires in the Hazardous Duty Plan of
LASERS, become effective June 30, 2014.
(Amends R.S. 11:102(C)(1)(l) and (4)(b), 612(intro. para.), 613(A), 615(B), 3681, 3682(1),
(2), (4)(a), (7), (16), (18) through (20), and (26), 3683(intro. para.), (1), and (3)(b), 3684(A),
(D), and (F), 3685(A)(1)(a) and (2)(intro. para.) and (d), (B)(1), (3) through (6), and (8),
(C)(1), (2), and (13), and (D), 3685.2(B)(6) and (7), 3686(B)(1), (D)(3), and (E), 3688,
3688.1, 3690(A) and (B), 3690.2, 3692(A), and 3695(C)(intro. para.); Adds R.S.
11:102(C)(1)(m), 612(2.1), 620.1, 631, and 3682(20.1); Repeals R.S. 11:3682(29), 3685(E),
3689(B) through (E), 3690 (C) and (D), 3690.1, 3691, 3693, and 3698)