Louisiana House Bill HB79

Louisiana 2014 Regular Session

• Introduced: 3/10/14
• Refer: 3/10/14
• Report Pass: 4/28/14

Caption

Provides for enrollment of new hires of the Harbor Police Department of the Port of New Orleans in the Hazardous Duty Services Plan in the La. State Employees' Retirement System and for administration of the Harbor Police Retirement System by the La. State Employees' Retirement System (OR INCREASE APV)

Impact

The bill will affect the financial obligations of the Port of New Orleans concerning its retirement system. By allowing LASERS to administer HPRS, the burden of unfunded liabilities is expected to be addressed by better funding methods, as LASERS has a stronger actuarial funding structure. However, this shift may lead to increased contributions from the Port as it starts paying toward the UAL of LASERS, which could impact the financial planning of the agency, requiring careful management of budgetary resources in the coming years.

Summary

House Bill 79 seeks to transition the Harbor Police Retirement System (HPRS) to be administered by the Louisiana State Employees’ Retirement System (LASERS). The bill proposes that as of June 30, 2014, no new members will be allowed into the HPRS, with future hires from the Harbor Police Department being enrolled in the Hazardous Duty Services Plan under LASERS. This legislative change aims to stabilize retirement benefits while addressing the unfunded accrued liability (UAL) issues experienced by HPRS, encouraging a more sustainable funding strategy for public employees' retirement benefits.

Sentiment

Overall, the sentiment surrounding HB 79 appears to be cautiously optimistic among proponents, who argue that consolidating the retirement systems under LASERS may enhance financial stability and provide better benefits for current and future employees. Nonetheless, there are concerns regarding how this transition might impact existing retirees and the adequacy of future benefit increases under the new system.

Contention

Notable points of contention include the overall financial implications of transferring to a new retirement plan, as well as worries concerning potential losses for members transitioning from HPRS to the new Hazardous Duty sub plan. Critics may express apprehension about how actuarial costs will be managed, especially since the new plan aims to eliminate the previous 20% contribution cap for the Port towards employee costs. The concerns are primarily rooted in how these changes will affect the long-term viability of benefits and overall employee satisfaction.