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2024 Regular Session
HOUSE BILL NO. 31
BY REPRESENTATIVE FREIBERG
RETIREMENT/TEACHERS: Provides relative to the optional retirement plan and defined
benefit plan for the Teachers' Retirement System of Louisiana
1 AN ACT
2To amend and reenact R.S. 11:927(A) and to enact R.S. 11:927(B)(4) and (F), 929(B)(2)(d),
3 and 932, relative to the optional retirement plan; to provide for election to join the
4 Teachers' Retirement System of Louisiana; to provide for membership; to provide
5 relative to administrative fees charged by the system; to provide relative to certain
6 single-sum cash payments from the plan; and to provide for related matters.
7 Notice of intention to introduce this Act has been published
8 as provided by Article X, Section 29(C) of the Constitution
9 of Louisiana.
10Be it enacted by the Legislature of Louisiana:
11 Section 1. R.S. 11:927(A) is hereby amended and reenacted and R.S. 11:927(B)(4)
12and (F), 929(B)(2)(d), and 932 are hereby enacted to read as follows:
13 §927. Contributions
14 A. Each participant shall contribute monthly to the optional retirement plan
15 the same amount which he would be required to contribute to the regular retirement
16 plan of the Teachers' Retirement System of Louisiana if he were a member of that
17 retirement plan. Participant contributions may be made by employer pick-up in
18 accordance with the provisions of Section 414(h)(2) of the United States Internal
19 Revenue Code or any amendment thereto. The entirety of each participant's
20 contribution, less the participant's share of any monthly fee established by the board
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1 to cover the cost of administration and maintenance of the optional retirement plan,
2 shall be remitted to the appropriate designated company or companies for application
3 to the participant's contract or contracts.
4 B.
5 * * *
6 (4) Beginning July 1, 2026, in addition to any contributions otherwise
7 required to be submitted to the Teachers' Retirement System of Louisiana pursuant
8 to this Subsection, each employer shall contribute to the Teachers' Retirement
9 System of Louisiana on behalf of each participant in the optional retirement plan the
10 employer's share of any monthly fee established by the board to cover the cost of
11 administration and maintenance of the optional retirement plan. The Teachers'
12 Retirement System of Louisiana shall retain the contribution to cover the cost of
13 administration and maintenance of the optional retirement plan.
14 * * *
15 F.(1) Any monthly fee established by the board to cover the cost of
16 administration and maintenance of the optional retirement plan shall be expressed
17 as a percentage of the participant's earnable compensation. The participant's share
18 of the monthly fee shall be the lesser of:
19 (a) One-half of the total monthly fee.
20 (b) Five-hundredths of one percent of the participant's earnable
21 compensation.
22 (2) The employers share of the monthly fee shall be the balance remaining
23 after payment of the participant's share.
24 * * *
25 §929. Benefits not obligation of the state; payment of benefits; eligibility in other
26 plans
27 * * *
28 B.
29 * * *
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1 (2) The Board of Trustees of the Teachers' Retirement System may approve
2 the following single-sum cash payments:
3 * * *
4 (d) Annual disbursements in an amount sufficient to satisfy federal required
5 minimum distributions.
6 * * *
7 §932. Regular plan membership; irrevocable election
8 A.(1) Notwithstanding any provision of law to the contrary, any active
9 contributing participant in the optional retirement plan on June 30, 2024, whose first
10 employment making him eligible for participation in the optional retirement plan
11 occurred on or before July 31, 2020, and who, notwithstanding participation in the
12 optional retirement plan, is otherwise eligible for membership in the regular
13 retirement plan of the Teachers' Retirement System of Louisiana may make an
14 irrevocable election to become a member of the regular retirement plan of the
15 Teachers' Retirement System of Louisiana. The election shall be made in writing in
16 a manner prescribed by the system and received by the system on or before June 30,
17 2025.
18 (2) For a participant whose election is received by the system on or before
19 December 31, 2024, all contributions to the optional retirement plan from a
20 participant making the election and from his employer shall cease on January 31,
21 2025. Beginning February 1, 2025, the participant shall begin contributing to and
22 accruing benefits in the regular retirement plan of the Teachers' Retirement System
23 of Louisiana as a member first eligible for membership in a state system on that date.
24 The person's employing agency shall pay the system the contributions required
25 pursuant to R.S. 11:102.
26 (3) For a participant whose election is received by the system on or after
27 January 1, 2025, all contributions to the optional retirement plan from the participant
28 and from his employer shall cease on the last day of the month following the month
29 in which the system receives the election. Beginning the first day of the following
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1 month, the participant shall begin contributing to and accruing benefits in the regular
2 retirement plan of the Teachers' Retirement System of Louisiana as a member first
3 eligible for membership in the state system on that date. The person's employing
4 agency shall pay the system the contributions required pursuant to R.S. 11:102.
5 B.(1) Notwithstanding any provision of law to the contrary, any active
6 contributing participant in the optional retirement plan whose first employment
7 making him eligible for participation in the optional retirement plan occurred on or
8 after August 1, 2020, and who, notwithstanding participation in the optional
9 retirement plan, is otherwise eligible for membership in the regular retirement plan
10 of the Teachers' Retirement System of Louisiana may make an irrevocable election
11 to become a member of the regular retirement plan of the Teachers' Retirement
12 System of Louisiana. The election shall be made in writing in a manner prescribed
13 by the system and shall be received by the retirement system within five years of the
14 participant's first employment making him eligible for participation in the optional
15 retirement plan.
16 (2) For a participant making the election, all contributions to the optional
17 retirement plan from the participant and from his employer shall cease on the last
18 day of the month following the month in which the system receives the election.
19 Beginning the first day of the following month, the participant shall begin
20 contributing to and accruing benefits in the regular retirement plan of the Teachers'
21 Retirement System of Louisiana as a member first eligible for membership in a state
22 system on that date. The person's employing agency shall pay the system the
23 contributions required to R.S. 11:102.
24 C. Any and all distributions from the optional retirement plan to a participant
25 who made the election provided for in this Section shall be in accordance with R.S.
26 11:929.
27 D. If any participant making an election to become a member of the regular
28 retirement plan of the Teachers' Retirement System of Louisiana has, at the time of
29 such election, prior service in the regular retirement plan, the prior service shall be
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1 used for calculation of benefits only and shall not be used to attain eligibility for any
2 purpose, including but not limited to retirement, disability, or survivor benefits.
3 Section 2. The cost of this Act, if any, shall be funded with additional employer
4contributions in compliance with Article X, Section 29(F) of the Constitution of Louisiana.
5 Section 3. This Act shall become effective on June 30, 2024; if vetoed by the
6governor and subsequently approved by the legislature, this Act shall become effective on
7June 30, 2024, or on the day following such approval by the legislature, whichever is later.
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 31 Engrossed 2024 Regular Session Freiberg
Abstract: Allows an optional retirement plan participant to transfer to the defined benefit
plan in the Teachers' Retirement System of La. (TRSL).
Present law, relative to TRSL, provides that an employee of a public institution of higher
education may elect to enter the optional retirement plan (ORP) when he is first hired in an
eligible TRSL-covered position.
Present law provides for a monthly fee established by TRSL to cover the cost of
administration and maintenance of the ORP, which fee is remitted to the appropriate
designated company or companies for application to the participant's contract or contracts.
Proposed law provides that, beginning on Jul. 1, 2026, the employer is required to contribute
the administration and maintenance fee. Provides for the participant to pay a share of the
monthly fee, which shall be the lesser of:
(1)One-half of the total monthly fee.
(2)0.05% of the participant's earnable compensation.
Proposed law provides the balance remaining of the monthly fee is to be paid by the
employer.
Present law provides that participation in the ORP is an irrevocable decision and a
participant is not eligible for membership in TRSL after joining the ORP.
Proposed law provides that an active, contributing participant in the ORP may elect, through
written notice to TRSL, to cease contributions to the ORP and begin membership in the
regular retirement plan of TRSL. Provides for termination of contributions to the ORP and
commencement of contributions to TRSL based on the date the system receives the
member's election.
Proposed law provides that for participants in the ORP who became eligible for participation
in the plan on or after Aug. 1, 2020, the election to terminate participation shall be received
within five years after his first employment making him eligible for participation in the ORP.
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Proposed law provides that distributions from the ORP shall be made in accordance with
present law.
Proposed law provides that for a person who moves from the ORP to the regular retirement
plan and who has prior service credit in TRSL, the prior service credit may be applied in
calculating a benefit but not in determining eligibility for benefits.
Proposed law requires that any cost of proposed law be funded with additional employer
contributions in compliance with Art. X, Sec 29(F) of the Constitution of Louisiana.
Effective June 30, 2024.
(Amends R.S. 11:927(A); Adds R.S. 11:927(B)(4) and (F), 929(B)(2)(d), and 932)
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Retirement to the
original bill:
1. Add provisions for payment of administration fees.
2. Make option of transferring from ORP available to all participants rather than
only those participating on June 30, 2024.
3. Add five-year limit on option to transfer from ORP to the regular retirement plan.
4. Add provision regarding use of prior service credit in TRSL.
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