2018 REGULAR SESSION
ACTUARIAL NOTE HB 43
Page 1 of 6
House Bill 43 HLS 18RS-206
Original
Author: Representative Pearson
Date: March 3, 2018
LLA Note HB 43 .01
Organizations Affected:
Louisiana State Employees’
Retirement System
Registrar of Voters Employees’
Retirement System
OR SEE ACTUARIAL NOTE
This Note has been prepared by the Actuarial Services Department of the
Legislative Auditor with assistance from either the Fiscal Notes staff of the
Legislative Auditor or staff of the Legislative Fiscal Office. The attachment of this
Note provides compliance with the requirements of R.S. 24:521 as amended by
Act 353 of the 2016 Regular Session.
Bill Header: RETIREMENT/SYSTEMS: Provides for the incorporation of the Registrars of Voters Employees’ Retirement Plan into
the Louisiana State Employees Retirement System.
Cost Summary:
The estimated actuarial and fiscal impact of HB 43 on the retirement systems and their plan sponsors is summarized below. Actuarial
costs pertain to estimated changes in the actuarial p resent value of future benefit payments. Fiscal costs or savings pertain to
changes to all cash flows over the next five year period including retirement system cash flows, OPEB cash flows, or cash flows
related to other government entities.
An increase in actuarial costs is denoted throughout the actuarial note by “Increase” or a positive number. Actuarial savings are
denoted by “Decrease” or a negative number. An increase in expenditures or revenues (fiscal impact) is denoted by “Increase” or a
positive number. A decrease in expenditures or revenues is denoted by “decrease” or a negative number.
Estimated Actuarial Impact:
The top part of the following chart shows the estimated change in the actuarial present value of future benefit payments and
expenses, if any, attributable to the proposed legislation. The bottom part shows the effect on cash flows.
Actuarial Costs Pertaining to:
Actuarial Cost
The Retirement Systems $0
Other Post Employment Benefits (OPEB 0
Other Government Entities 0
Total $0
Five Year Fiscal Cost Pertaining to: Expenses Revenues
The Retirement Systems $0 $0
Other Post Employment Benefits 0 0
Other Government Entities 0 0
Total $0 $0
This bill complies with the Louisiana Constitution which requires unfunded liabilities created by an improvement in r etirement
benefits to be amortized over a period not to exceed ten years.
Bill Information
Current Law
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
Proposed Law
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
Implications of the Proposed Changes
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
I. ACTUARIAL ANALYSIS SECTION
A. Analysis of Actuarial Costs
(Prepared by the LLA)
This section of the actuarial note pertains to actuarial costs or savings assoc iated with the retirement systems , with OPEB, and
with other government entities. 2018 REGULAR SESSION
ACTUARIAL NOTE HB 43
Page 2 of 6
1. Retirement Systems
The actuarial cost or savings of HB 43 associated with the retirement systems is estimated to be $0. The actuary’s analysis is
summarized below.
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
2. Other Post-Employment Benefits (OPEB)
The actuarial cost or savings of HB 43 associated with OPEB, including retiree health insurance premiums, is estimated to be
$0. The actuary’s analysis is summarized below.
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
3. Other Government Entities
The actuarial cost or savings of HB 43 associated with government entities other than those identified in HB 43 , is estimated
to be $0. The actuary’s analysis is summarized below.
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
B. Actuarial Data, Methods and Assumptions
(Prepared by the LLA)
Unless indicated otherwise, the actuarial note for HB 43 was prepared using actuarial data, methods, and assumptions as disclosed
in the most recent actuarial valuation report adopted by PRSAC. The data, methods and assumptions are being used to provide
consistency with the actuary for the retirement system who may also be providing testimony to the Senate and House retirement
committees.
C. Actuarial Caveat
(Prepared by the LLA)
There is nothing in HB 43 that will compromise the signing actuary’s ability to present an unbiased statement of actuarial opinion.
II. FISCAL ANALYSIS SECTION
Tables A, B, C, and D have been prepared by the LLA. These tables include information developed by the LLA from its own sources
as well as information supplied by Tanesha Morgan of the Legislative Fiscal Office (LFO). Table D includes all costs and savings
pertaining to Louisiana government.
The LFO has requested that the information supplied by Tanesha Morgan be included in the actuarial note verbatim and without any
changes. This information is shown below under Fiscal Costs Developed by the LFO. The reader should note that complete fiscal
cost information is contained within Table D. Fiscal costs developed by the LFO only reflect the portion of Table D that was supplied
by the LFO.
Table A pertains to fiscal costs or savings associated with the retirement systems; Table B pertains to OPEB; Table C pertains to fiscal
costs associated with government entities other than the retirement systems and sponsors. Table D is the cumulative sum of Tables A,
B, and C.
A. Estimated Fiscal Impact – Retirement Systems
(Prepared by the LLA)
1. Narrative
Table A shows the estimated fiscal impact of the proposed legislation on the retirement systems and the government entities
that sponsor them. Fiscal costs and savings include both administrative and actuarial costs and savings. A fiscal cost is
denoted by “Increase” or a positive number. Fiscal savings are denoted by “Decrease” or a negative number. A revenue
increase is denoted by “Increase” or a positive number. A revenue decrease is denoted by “Decrease” or a negative number.
2018 REGULAR SESSION
ACTUARIAL NOTE HB 43
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Retirement System Fiscal Cost: Table A EXPENDITURES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
REVENUES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
B. Estimated Fiscal Impact – OPEB
(Prepared by the LLA)
1. Narrative
Table B shows the estimated fiscal impact of HB 43 on actuarial costs or savings associated with OPEB and the government
entities that sponsor these benefit programs. Fiscal costs or savings in Table B include administrative costs associated with
the government entity sponsoring the OPEB program. A fiscal cost is denoted by “Increase” or a positive number. Fiscal
savings are denoted by “Decrease” or a negative number. A revenue increase is denoted by “Increase” or a positive number.
A revenue decrease is denoted by “Decrease” or a negative number.
OPEB Fiscal Cost: Table B
EXPENDITURES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
REVENUES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
C. Estimated Fiscal Impact: Other Government Entities (unrelated to the retirement systems or OPEB)
(Prepared by Bradley Cryer, Assistant Legislative Auditor )
1. Narrative
From time to time, legislation is proposed that has an indirect effect on cash flows associated with other government entities,
unrelated to the retirement systems or OPEB. Table C shows the estimated fiscal impact of HB 43 on such government
entities. A fiscal cost is denoted by “Increase” or a positive number. Fiscal savings are denoted by “Decrease” or a negative
number.
2018 REGULAR SESSION
ACTUARIAL NOTE HB 43
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Fiscal Costs for Other Government Entities: Table C EXPENDITURES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
REVENUES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
D. Estimated Fiscal Impact − All Retirement Systems, OPEB, and All Government Entities
(Prepared by the LLA)
1. Narrative
Table D shows the estimated fiscal impact of HB 43 on all government entities within the state of Louisiana. Cell values in
Table D are the sum of the respective cell values in Table A, T able B, and Table C. A fiscal cost is denoted by “Increase” or
a positive number. F iscal savings are denoted by “Decrease” or a negative number. A revenue increase is denoted by
“Increase” or a positive number. A revenue decrease is denoted by “Decrease” or a negative number.
Total Fiscal Cost: Table D (Cumulative Costs from Tables A, B, & C)
EXPENDITURES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
REVENUES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Fiscal Costs Received by the LLA from the LFO
1. Narrative
Proposed law provides for the incorporation of the existing Registrars of Voters Employees' Retirement System (ROVERS)
into Louisiana State Employees' Retirement System (LASERS). Proposed law provides that members of ROVERS hired on
or before June 30, 2018 be moved to a newly created ROVER Plan within LASERS. Proposed law provides that any
registrar of voters appointed after June 30, 2018 and any employee of an office of a registrar of voters hired after June 30,
2018 shall become a rank and file member of LASERS. Proposed law repeals the ROVERS board on July 1, 2018 and
provides that the LASERS board shall complete the transfer all administrative functions from ROVERS to LASERS within
two years of July 1, 2018.
2018 REGULAR SESSION
ACTUARIAL NOTE HB 43
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Fiscal Costs for Other Government Entities EXPENDITURES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
REVENUES 2018-19 2019-2020 2020-2021 2021-2022 2022-23 5 Year Total
State General Fund $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Agy Self Generated 0 0 0 0 0 0
Stat Deds/Other 0 0 0 0 0 0
Federal Funds 0 0 0 0 0 0
Local Funds 0 0 0 0 0 0
Annual Total $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
HB 43 will have the following effects on fiscal costs and revenues related to other government entities during the five year
measurement period.
2. Expenditures:
There will be some initial savings to ROVERS of up to $189,673 for board expenses ($31,600) and other administrative
expenses ($158,073). These are itemized below.
The bill immediately eliminates the ROVERS board of trustees. The FY 18 budget for ROVERS board expenses is $31,600
and includes per diems, continuing education, and travel. Therefore, there is anticipated to be an immediate saving to
ROVERS of $31,600.
The bill also transfers the administrative functions of ROVERS to LASERS within two years. The FY 18 budget for ROVERS
administrative expenses is $158,073 and includes expenses such as the salary for a part time Executive Director and part
time office assistant, office supplies, office equipment, Internet service and security monitoring. Therefo re, there is
anticipated to be savings to ROVERS of $158,073.
LASERS does not anticipate the need to hire additional staff to manage administrative functions of ROVERS; and all of the
cost associated with administering the ROVER plan is anticipated to be absorbed through LASERS’ existing budget.
However, the LFO anticipates that there may be some indeterminable initial implementation costs to LASERS associated
with the modification of its computer systems.
Note: The sources of revenue that fund the board and administrative expenses at ROVERS are employer and employee
contributions and ad valorem taxes.
3. Revenues:
There is no anticipated direct material effect on governmental revenues as a result of this measure.
Credentials of the Signatory Staff:
Paul T. Richmond is the Manager of Actuarial Services for the Louisiana Legislative Auditor. He is an Enrolled Actuary, a member
of the American Academy of Actuaries, a member of the Society of Actuaries and has met the Qualification Standards of the
American Academy of Actuaries necessary to render the actuarial opinion contained herein.
John D. Carpenter, Legislative Fiscal Officer and Bradley Cryer, Assistant Legislative Auditor, have supervised the preparation of the
fiscal analyses contained herein.
Information Pertaining to Article (10)(29(F) of the Louisiana Constitution
HB 43 contains a retirement system benefit provision having an actuarial cost.
HB 43 does not contain enough information to clearly identify and compare current and proposed law.
2018 REGULAR SESSION
ACTUARIAL NOTE HB 43
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Dual Referral Relative to Total Fiscal Costs or Total Cash Flows:
The information presented below is based on information contained in Table D for the first three years following the 2018 regular
session.
Senate House
13.5.1 Applies to Senate or House Instruments. 6.8F Applies to Senate or House Instruments.
If an annual fiscal cost ≥ $100,000, then bill is
dual referred to:
If an annual General Fund fiscal cost ≥
$100,000, then the bill is dual referred to:
Dual Referral: Senate Finance Dual Referral to Appropriations
13.5.2 Applies to Senate or House Instruments. 6.8G Applies to Senate Instruments only.
If an annual tax or fee change ≥ $500,000,
then the bill is dual referred to:
If a net fee decrease occurs or if an increase in
annual fees and taxes ≥ $500,000, then the bill is
dual referred to:
Dual Referral: Revenue and Fiscal Affairs
Dual Referral: Ways and Means