SLS 17RS-37 ORIGINAL
2017 Regular Session
SENATE BILL NO. 8
BY SENATOR PEACOCK
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
RETIREMENT SYSTEMS. Provides for correction of membership and enrollment errors
in the state and statewide retirement systems. (6/30/17)
1 AN ACT
2 To enact R.S. 11:143.1 and 888.1 and to repeal R.S. 11:896 and 1119, relative to enrollment
3 in certain state and statewide retirement systems; to provide for the correction of
4 enrollment errors, including the transfer of monies, service credit, and liabilities; to
5 provide for the payment of costs of the transfer; to provide for an effective date; and
6 to provide for related matters.
7 Notice of intention to introduce this Act has been published.
8 Be it enacted by the Legislature of Louisiana:
9 Section 1. R.S. 11:143.1 and 888.1 are hereby enacted to read as follows:
10 §143.1. Correction of membership errors
11 A. The provisions of this Section shall be applicable to all employees in
12 positions covered by state and statewide public retirement systems.
13 B.(1) If a person is employed in a position that on the date of employment
14 was covered by a system to which this Section applies, but was by error enrolled
15 in another public pension or retirement system, plan, or fund, and has not
16 retired from or participated in the deferred retirement option plan of the
17 incorrect system, he shall be enrolled in the correct system if he remains eligible
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1 for membership in that system, and all service credit and the funds required by
2 Subsection C of this Section shall be transferred to the correct system.
3 (2) Within thirty days of the date the error is discovered, the incorrect
4 system shall notify the employee and the employer of the error and shall initiate
5 the transfer with the correct system.
6 (3)(a) If the employee previously received a refund of employee
7 contributions from the incorrect system, the employee shall be given the
8 opportunity to restore the forfeited service credit before the transfer by
9 repaying to the incorrect system the refunded contributions plus interest at the
10 board-approved actuarial valuation interest rate of the incorrect system. Upon
11 receiving notification of the enrollment error, the employee shall have ninety
12 days to restore the forfeited service credit as provided in this Paragraph.
13 (b) If the refund is not repaid within ninety days, then the service credit
14 associated with the refund shall not be restored before the transfer. Once the
15 transfer is complete, the employee may still restore the forfeited service credit
16 by paying to the incorrect system the amount required by this Paragraph. Upon
17 repayment, the restored service credit shall be transferred immediately to the
correct system in accordance with R. S. 11:143; however, notwithstanding the18
19 provisions of R.S. 11:143(D)(4) to the contrary, the retirement percentage factor
20 of the correct system shall be used to calculate the retirement benefit based on
21 the number of years transferred.
22 C.(1) The correct system shall determine the employee contributions that
23 system would have received if the employee had been properly enrolled on the
24 date of employment. That system shall notify the incorrect system and the
25 employee of the calculation.
26 (2)(a) The incorrect system shall determine the contributions made by
27 the employee, any employee contributions paid by the employer, the employer
28 contributions paid on the earnable compensation of the employee, and interest
29 on those contributions compounded annually at the board-approved actuarial
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1 valuation interest rate of the incorrect system and the total of these amounts.
2 The incorrect system shall provide these calculations to the employee, the
3 employer, and the correct system.
4 (b) If the amount of employee contributions calculated pursuant to
5 Paragraph (1) of this Subsection is less than the amount of contributions made
6 by the employee as determined by the incorrect system in Subparagraph (a) of
7 this Paragraph, the incorrect system shall pay to the employee the amount of
8 the overpayment.
9 (c) The incorrect system shall transfer to the correct system the total
10 calculated pursuant to Subparagraph (a) of this Paragraph less any payment to
11 the employee pursuant to Subparagraph (b) of this Paragraph.
12 D.(1) The correct system shall calculate the amount necessary to fund
13 the receipt of the service credit as provided in this Subsection.
14 (2)(a) If the transfer occurs within three years of the enrollment error
15 the correct system shall receive an amount equal to all employee and employer
16 contributions that would have been received by the correct system had the
17 employee been properly enrolled on the date of employment, plus interest at the
18 correct system's board-approved actuarial valuation interest rate.
19 (b) If the transfer occurs more than three years after the enrollment
20 error, the correct system shall receive the greater of:
21 (i) An amount equal to all employee and employer contributions that
22 would have been received by the correct system had the employee been properly
23 enrolled at employment plus interest compounded annually at the correct
24 system's board-approved actuarial valuation interest rate.
25 (ii) The actuarial cost to the correct system for the service credit
26 transferred, calculated in accordance with R.S. 11:158(C)(1)(a) and (2). The
27 employer shall pay any fee or cost for this calculation.
28 (3) If the amount transferred from the incorrect system pursuant to
29 Subparagraph (C)(2)(c) of this Section is not sufficient to pay the amount
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1 required by the provisions of Paragraph (2) of this Subsection, the employer
2 shall pay any difference to the correct system.
3 (4) If the amount transferred from the incorrect system pursuant to
4 Subparagraph (C)(2)(c) of this Section exceeds the amount required by the
5 provisions of Paragraph (2) of this Subsection, the correct system shall credit
6 to the employer's account the amount of the overpayment.
7 E. Upon transfer of all monies required pursuant to Subparagraph
8 (C)(2)(c) of this Section, all of the employee's service credit shall be transferred
9 to the correct system and the employee's refundable contribution balance in the
10 correct system shall be equal to the employee contributions that would have
11 been paid to the correct system had the employee been properly enrolled in the
12 correct system at employment. The retirement percentage factor of the correct
13 system shall be used to calculate the employee's retirement benefit based on the
14 number of years transferred.
15 F. After the date on which the transfer of the funds required pursuant
16 to Subparagraph (C)(2)(c) is completed, the system from which the employee
17 transfers shall have no future liability with respect to the service credit, liability,
18 or contributions transferred to the correct system.
19 * * *
20 §888.1. Service for which credit has not been received
21 If a person is employed in a position in which he should have been
22 enrolled in this system on the date of employment, but was not enrolled in any
23 public retirement system, he shall become a member of this system. He may
24 establish service credit for the time he should have been a member of this
25 system only under the provisions of R.S. 11:888.
26 Section 2. R.S. 11:896 and 1119 are hereby repealed.
27 Section 3. This Act shall become effective on June 30, 2017; if vetoed by the
28 governor and subsequently approved by the legislature, this Act shall become effective on
29 June 30, 2017, or on the day following such approval by the legislature, whichever is later.
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The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Laura Gail Sullivan.
DIGEST
SB 8 Original 2017 Regular Session Peacock
Proposed law provides for the correction of an enrollment error for a person incorrectly
enrolled in any La. public pension or retirement system, plan, or fund who should have been
enrolled in one of the state or statewide retirement systems.
The state systems are:
(1) La. State Employees' Retirement System (LASERS).
(2) Teachers' Retirement System of La. (Teachers' or TRSL).
(3) La. School Employees' Retirement System (LSERS).
(4) La. State Police Retirement System (TROOPERS).
The statewide systems are:
(1) Assessors' Retirement Fund (Assessors).
(2) Clerks' of Court Retirement and Relief Fund (Clerks).
(3) District Attorneys' Retirement System (DARS).
(4) Firefighters' Retirement System (FRS).
(5) Municipal Employees' Retirement System of La. (MERS).
(6) Municipal Police Employees' Retirement Systems (MPERS).
(7) Parochial Employees' Retirement System of La. (PERS).
(8) Registrar of Voters Employees' Retirement System (ROVERS).
(9) Sheriffs' Pension and Relief Fund (Sheriffs).
Proposed law provides that any person who was enrolled in the wrong system by error but
who should have been in one of the systems covered by proposed law shall be transferred
to the system for which his employment makes him eligible.
Proposed law provides that the employee shall be notified of the error by the incorrect
system. Requires the incorrect system to initiate the transfer within 30 days of the date the
error is discovered.
Proposed law provides for restoration of forfeited service credit at the incorrect system if the
employee repays any refund received from the incorrect system. Provides for the transfer of
the restored service credit and associated funds to the correct system.
Proposed law provides for calculation and transfer of funds from the incorrect system to the
correct system. Specifies that upon transfer of all the money required pursuant to proposed
law from the incorrect system to the correct system, all of the employee's service credit shall
be transferred to the correct system and the employee's refundable contribution balance shall
be equal to the contributions he would have paid to the correct system if the employee had
been properly enrolled.
Proposed law provides for calculation of the amount necessary to fund the actuarial liability
created by receipt of the service credit by the correct system. Requires the employer to pay
any deficit between the amount the incorrect system transferred to the correct system and
the amount necessary to fund the liability created by receipt of the service credit.
Proposed law provides for any overpayment of employee contributions to be refunded to the
employee. Provides for any overpayment by the employer to be refunded to the employer.
Present law (R.S. 11:896(C)), relative to the Teachers' system only, provides for enrollment
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in that system of a person employed in a position covered by the system who was not
enrolled in any public retirement system. Provides the person may establish service credit
for the time he should have been a member of this system only under the provisions of
present law (R.S. 11:888).
Proposed law retains present law and redesignates it as R.S. 11:888.1.
Effective June 30, 2017.
(Adds R.S. 11:143.1 and 888.1; repeals R.S. 11:896 and 1119)
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