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)]
CONFERENCE COMMI TTEE REPORT DIGEST
House Bill No. 1278 by Representative Pearson
Keyword and oneliner of the instrument as it left the House
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
Report adopts Senate amendments to:
1. Relative to a proposed law prohibition on the suspension or reduction in benefits paid to
certain retirees of the Harbor Police Retirement System who are re-employed in a
position covered by LASERS, adds "increase" as a prohibited change in the benefits of
such persons and adds that the prohibition on all such benefit changes applies only until
termination of re-employment.
2. Makes technical corrections.
Digest of the bill as proposed by the Conference Committee
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, 2015.
Proposed law places any commissioned employee of the Harbor Police Department of the Port of
New Orleans first hired on or after July 1, 2015, in the Hazardous Duty Services Plan in
LASERS.
MEMBERS OF THE HARBOR POLI CE RETIREMENT SYSTEM AS OF
JUNE 30, 2015
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 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.
Present law requires suspension or reduction of benefits if a LASERS retiree becomes re-
employed in a LASERS-covered position. Proposed law provides an exception for a retiree of
the Harbor Police Retirement System who has been retired from such system for at least one year
as of July 1, 2014, and who is employed in a position making him eligible for membership in LASERS on July 1, 2015. Exempts the benefits of such a member from suspension or reduction
until the employee's subsequent retirement. Further exempts the benefits of such a member from
increase until the employee's subsequent retirement.
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 requires 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 endeavor
agreement. Requires submission of the cooperative endeavor agreement to the House and Senate committees on retirement by Oct. 1, 2014.
Effective July 1, 2015, only if the Public Retirement Systems' Actuarial Committee approves the
terms of the cooperative endeavor agreement authorized pursuant to proposed law prior to
December, 31, 2014.
(Amends R.S. 11:102(C)(1)(l) and (4)(b), 612(intro. para.), 613(A), 615(B), the heading of
Subpart G of Part II of Chapter 3 of Subtitle IV of Title 11 of the La. Revised Statutes of 1950,
3681, 3682(1), (2), (4)(a), (7), (16), (18)-(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)-(6), and (8), (C)(1),
(2), and (13), and (E), 3685.2(B)(intro. para.), (6), and (7), 3686(B)(1), (D)(3), and (E), 3688(D),
3688.1, 3690(A) and (B), 3690.2, 3692(A), and 3695(C)(intro. para.); Adds R.S.
11:102(C)(1)(m), 416(A)(3)(d), 612(2.1), 620.1, 631, and 3682(20.1); Repeals R.S. 11:3682(29),
3685(D), 3688(A)-(C) and (E), 3689(B)-(E), 3690(C) and (D), 3690.1, 3691, 3693, and 3698)