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)]
HB 19 Original 2020 Regular Session Bacala
Abstract: Authorizes the Municipal Police Employees' Retirement System (MPERS) to increase
required employer contribution rates in certain circumstances and establishes a funding
deposit account within the system for collection of contribution remittances above the
actuarially required amount.
Present law provides for employer contribution rates within MPERS. Provides that in any fiscal year
during which the recommended employer contribution rate would otherwise be decreased, the board
of trustees may either maintain the previous fiscal year's employer contribution rate or set the
employer contribution rate at any point between the previous year's rate and the recommended rate.
Present law further provides that any excess funds resulting from the board's exercise of its authority
shall be combined with any contribution surplus, or offset by any contribution shortfall, and the
resulting balance, if greater than zero, shall be applied for the following purposes:
(1)To reduce system unfunded accrued liabilities.
(2)To reduce the outstanding amortization charge base or bases.
Proposed law retains present law and provides that excess funds, after compliance with present law,
shall be applied to a contribution surplus base or to reduction of the present value of future normal
costs.
Present law provides a formula for determining the required employer contribution rates for the
statewide retirement systems. Present law grants certain statewide retirement systems the authority
to increase required employer contribution rates up to 3% more than the rate determined under
present law. Proposed law grants MPERS the same authority.
Present law (R.S. 11:107.1) establishes a "funding deposit account" in certain statewide systems.
Funds collected pursuant to present law in excess of minimum required employer contribution rates
are credited to this account and may be used by the board of trustees of the system for the following
purposes:
(1)Reduce system unfunded accrued liabilities.
(2)Reduce future employer contribution rates. (3)Pay cost-of-living adjustments.
Proposed law establishes a funding deposit account within MPERS and further provides that the
system may only provide for cost-of-living adjustments from the funding deposit account.
Present law provides that MPERS may provide a supplemental cost-of-living adjustment from
interest income from investments to all retirees and beneficiaries who are 65 years of age or over
provided certain requirements are met. Proposed law provides that after June 30, 2020, the first of
such cost-of-living increase may be funded under present law, and any such cost-of-living increase
thereafter may only be funded through the funding deposit account.
Effective June 30, 2020.
(Adds R.S. 11:105(A)(8), 106(A)(5), 107(A)(7), 107.1(A)(7) and (D)(5), and 246(C); Repeals R.S.
11:107.2 and 2225(A)(7))