Louisiana House Bill HB85

Louisiana 2014 Regular Session

• Introduced: 3/10/14
• Refer: 3/10/14

Caption

Provides a permanent benefit increase paid from the experience account to certain retired members and beneficiaries of the Louisiana State Employees' Retirement System (OR +$97,481,233 APV)

Impact

The enactment of HB 85 is projected to increase the actuarial present value of future benefits by approximately $97.5 million. This increase will require an outflow of funds from the Experience Account to the Regular Benefit Account, effectively repositioning state resources to accommodate these new benefit levels. Notably, the legislation ensures that employer contribution requirements will remain unchanged while facilitating a sustainable increase in retiree benefits over time.

Summary

House Bill 85 aims to provide a permanent benefit increase for certain retired members and beneficiaries of the Louisiana State Employees’ Retirement System (LASERS). This legislation proposes a 1.5% increase based on the portion of each retiree's benefit that is less than $96,931. The bill's intent is to enhance the financial well-being of eligible retirees, allowing them a modest increase in their annual benefits, which is set to take effect on July 1, 2014. The bill focuses on ensuring that retirees who have served and contributed to the state receive fair compensation as they age.

Sentiment

Overall sentiment towards HB 85 appears supportive from the perspective of retirees and advocates for public employee benefits. However, some concerns have been raised regarding the long-term financial sustainability of the proposed increases, particularly in light of the broader fiscal constraints faced by the state. Proponents argue that enhancing retirement benefits is a moral imperative and a necessary recognition of the contributions of public servants, while opponents may point to potential impacts on the state budget.

Contention

Debate surrounding HB 85 emphasizes the balance between providing adequate support for retirees and maintaining fiscal responsibility. Opponents are concerned that increasing benefits could strain state resources in the future, especially given that no additional revenues are anticipated from the General Fund to cover these costs. The legislation's approval hinges on the legislative requirement for a two-thirds majority, indicating a need for careful consideration of the state's capacity to support such increases sustainably.