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Regular Session, 2014
SENATE BILL NO. 673
BY SENATOR GUILLORY
RETIREMENT BENEFITS. Repeals provisions ruled unconstitutional related to Act 483
of the 2012 regular legislative session. (6/30/14)
AN ACT1
To amend and reenact R.S. 11:62(4)(introductory paragraph), (5)(introductory paragraph),2
and (11)(introductory paragraph), 102(B)(1) and (3)(a) and (d)(v), (vi), and (vii),3
542(A)(2)(a), 883.1(A)(2)(a), and 1145.1(A)(1)(a), (C)(4)(a)(introductory4
paragraph), and (E) and to repeal R.S. 11:62(4.1), (5.1), and (11.1), 102(C)(1)(m),5
542 (C)(4)(d)(iii) and (e)(iii), 883.1(C)(4)(d)(iii) and (e)(iii), 1145.1(C)(4)(a)(iii) and6
(b)(iii), and Chapter 7 of Subtitle II of Title 11 of the Louisiana Revised Statutes of7
1950, comprised of R.S. 11:1399.1 through 1399.7, relative to the cash balance plan;8
to delete provisions referencing the plan; to provide for an effective date; and to9
provide for related matters.10
Notice of intention to introduce this Act has been published.11
Be it enacted by the Legislature of Louisiana:12
Section 1. R.S. 11:62(4)(introductory paragraph), (5)(introductory paragraph), and13
(11)(introductory paragraph), 102(B)(1) and (3)(a) and (d)(v), (vi), and (vii), 542(A)(2)(a),14
883.1(A)(2)(a), and 1145.1(A)(1)(a), (C)(4)(a)(introductory paragraph), and (E) are hereby15
amended and reenacted to read as follows:16
§62. Employee contribution rates established17 SB NO. 673
SLS 14RS-1259 ORIGINAL
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words in boldface type and underscored are additions.
Employee contributions to state and statewide public retirement systems shall1
be paid at the following rates, except as otherwise provided by law:2
* * *3
(4) Louisiana School Employees' Retirement System members in Tier 1:4
* * *5
(5) Louisiana State Employees' Retirement System members in Tier 1:6
* * *7
(11) Teachers' Retirement System of Louisiana members in Tier 1:8
* * *9
§102. Employer contributions; determination; state systems10
* * *11
B.(1) Except as provided in Subsection C of this Section for the Louisiana12
State Employees' Retirement System and Subsection D of this Section for the13
Teachers' Retirement System of Louisiana and except as provided in R.S. 11:102.1,14
102.2, and in Paragraph (5) of this Subsection, for each fiscal year, commencing with15
Fiscal Year 1989-1990, for each of the public retirement systems referenced in16
Subsection A of this Section, the legislature shall set the required employer17
contribution rate equal to the actuarially required employer contribution, as18
determined under Paragraph (3) of this Subsection, divided by the total projected19
payroll of all active members including cash balance plan members of each20
particular system for the fiscal year. Each entity funding a portion of a member's21
salary shall also fund the employer's contribution on that portion of the member's22
salary at the employer contribution rate specified in this Subsection.23
* * *24
(3) With respect to each state public retirement system, the actuarially25
required employer contribution for each fiscal year, commencing with Fiscal Year26
1989-1990, shall be that dollar amount equal to the sum of:27
(a) The employer's normal cost for that fiscal year, computed as of the first28
of the fiscal year using the system's actuarial funding method as specified in R.S.29 SB NO. 673
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words in boldface type and underscored are additions.
11:22 and taking into account the value of future accumulated employee1
contributions and interest thereon, such employer's normal cost rate multiplied by the2
total projected payroll for all active members including cash balance plan members3
to the middle of that fiscal year. For the Louisiana State Employees' Retirement4
System, effective for the June 30, 2010, system valuation and beginning with Fiscal5
Year 2011-2012, the normal cost shall be determined in accordance with Subsection6
C of this Section. For the Teachers' Retirement System of Louisiana, effective for7
the June 30, 2011, system valuation and beginning with Fiscal Year 2012-2013, the8
normal cost shall be determined in accordance with Subsection D of this Section.9
* * *10
(d) That fiscal year's payment, computed as of the first of that fiscal year and11
projected to the middle of that fiscal year at the actuarially assumed interest rate,12
necessary to amortize changes in actuarial liability due to:13
* * *14
(v) Effective July 1, 2004, and beginning with Fiscal Year 1998-1999, the15
amortization period for the changes, gains, or losses of the Louisiana State16
Employees' Retirement System provided in Items (i) through (iv) of this17
Subparagraph shall be thirty years, or in accordance with standards promulgated by18
the Governmental Accounting Standards Board, from the year in which the change,19
gain, or loss occurred. The outstanding balances of amortization bases established20
pursuant to Items (i) through (iv) of this Subparagraph before Fiscal Year21
1998-1999, shall be amortized as a level dollar amount from July 1, 2004, through22
June 30, 2029. Beginning with Fiscal Year 2003-2004, and for each fiscal year23
thereafter, the outstanding balances of amortization bases established pursuant to24
Items (i) through (iv) of this Subparagraph and for any changes, gains, or losses25
attributable to the cash balance plan shall be amortized as a level dollar amount. For26
the Louisiana State Employees' Retirement System, effective for the June 30, 2010,27
system valuation and beginning with Fiscal Year 2011-2012, amortization payments28
for changes in actuarial liability shall be determined in accordance with Subsection29 SB NO. 673
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C of this Section.1
(vi) Effective July 1, 2004, and beginning with Fiscal Year 2000-2001, the2
amortization period for the changes, gains, or losses of the Louisiana School3
Employees' Retirement System provided in Items (i) through (iv) of this4
Subparagraph and for any changes, gains, or losses attributable to the cash balance5
plan shall be thirty years, or in accordance with standards promulgated by the6
Governmental Accounting Standards Board, from the year in which the change, gain,7
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
(vii) Effective July 1, 2004, and beginning with Fiscal Year 2000-2001, the14
amortization period for the changes, gains, or losses of the Teachers' Retirement15
System of Louisiana provided in Items (i) through (iv) of this Subparagraph and for16
any changes, gains, or losses attributable to the cash balance plan shall be thirty17
years, or in accordance with standards promulgated by the Governmental Accounting18
Standards Board, from the year in which the change, gain, or loss occurred. The19
outstanding balances of amortization bases established pursuant to Items (i) through20
(iv) of this Subparagraph before Fiscal Year 2000-2001, shall be amortized as a level21
dollar amount from July 1, 2004, through June 30, 2029. Beginning with Fiscal Year22
2003-2004, and for each fiscal year thereafter, the outstanding balances of23
amortization bases established pursuant to Items (i) through (iv) of this Subparagraph24
shall be amortized as a level dollar amount. For the Teachers' Retirement System of25
Louisiana, effective for the June 30, 2011, system valuation and beginning with26
Fiscal Year 2012-2013, amortization payments for changes in actuarial liability shall27
be determined in accordance with Subsection D of this Section.28
* * *29 SB NO. 673
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§542. Experience account1
A.2
* * *3
(2) The experience account shall be credited as follows:4
(a) To the extent permitted by Paragraph (3) of this Subsection and after5
allocation to the consolidated amortization bases as provided in R.S. 11:102.1, an6
amount not to exceed fifty percent of the remaining balance of the prior year's net7
investment experience gain attributable to Tier 1 assets as determined by the system's8
actuary.9
* * *10
§883.1. Experience account11
* * *12
A.13
* * *14
(2) The experience account shall be credited as follows:15
(a) To the extent permitted by Paragraph (3) of this Subsection and after16
allocation to the consolidated amortization bases as provided in R.S. 11:102.2, an17
amount not to exceed fifty percent of the remaining balance of the prior year's net18
investment experience gain attributable to Tier 1 assets as determined by the system's19
actuary.20
* * *21
§1145.1. Employee Experience account Account22
A.(1) The experience account Employee Experience Account shall be23
credited as follows:24
(a) To the extent permitted by Paragraph (2) of this Subsection, an amount25
not to exceed fifty percent of the prior year's net investment experience gain26
attributable to Tier 1 assets as determined by the system's actuary.27
* * *28
(C)29 SB NO. 673
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* * *1
(4)(a) Except as provided in Subparagraph (c) of this Paragraph, in order to2
be eligible for the cost-of-living adjustment, there shall be the funds available in the3
experience account Employee Experience Account to pay for such an adjustment,4
and a retiree:5
* * *6
E. Effective July 1, 2007, the balance in the experience account Employee7
Experience Account shall be zero.8
* * *9
Section 2. R.S. 11:62(4.1), (5.1), and (11.1), 102(C)(1)(m), 542 (C)(4)(d)(iii) and10
(e)(iii), 883.1(C)(4)(d)(iii) and (e)(iii), 1145.1(C)(4)(a)(iii) and (b)(iii), and Chapter 7 of11
Subtitle II of Title 11 of the Louisiana Revised Statutes of 1950, comprised of R.S.12
11:1399.1 through 1399.7 are hereby repealed.13
Section 3. In the event of any conflict between the provision of this Act and the14
provisions of another Act of the 2014 Regular Session, the provisions of the other Act shall15
supercede and prevail. 16
Section 4. This Act shall become effective on June 30, 2014; if vetoed by the17
governor and subsequently approved by the legislature, this Act shall become effective on18
June 30, 2014, or on the day following such approval by the legislature, whichever is later.19
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Margaret M. Corley.
DIGEST
Guillory (SB 673)
Present law contains provisions enacted by Act 483 of the 2012 Regular Session which was
later ruled unconstitutional.
Proposed law restores the statutes to their previous form.
(Amends R.S. 11:62(4)(intro. para.), (5)(intro. para.), and (11)(intro. para.), 102(B)(1) and
(3)(a) and (d)(v), (vi), and (vii), 542(A)(2)(a), 883.1(A)(2)(a), and 1145.1(A)(1)(a),
(C)(4)(a)(intro. para.), and (E); repeals R.S. 11:62(4.1), (5.1), and (11.1), 102(C)(1)(m), 542
(C)(4)(d)(iii) and (e)(iii), 883.1(C)(4)(d)(iii) and (e)(iii), 1145.1(C)(4)(a)(iii) and (b)(iii), and
Chapter 7 of Subtitle II of Title 11 of the La. Revised Statutes of 1950, comprised of R.S.
11:1399.1 - 1399.7)