Louisiana Senate Bill SB27

Louisiana 2014 Regular Session

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

Caption

Provides for a supplemental benefit increase. (2/3 - CA10s29(F)) (6/30/14) (OR INCREASE APV)

Impact

The enactment of SB 27 is projected to significantly impact state laws related to retirement benefits. The actuarial present value of future benefits for LASERS will increase by approximately $97.5 million due to the mandated 1.5% increase. Each 0.1% increase in the supplemental PBI will additionally raise future liabilities by around $6.5 million. This increase highlights the need for legislative approval, as substantial changes to retirement benefits must adhere to specific constitutional provisions, ensuring legislative oversight over such financial commitments.

Summary

Senate Bill 27, authored by Senator Mike Walsworth, proposes a supplemental permanent benefit increase (PBI) for members of the Louisiana State Employees’ Retirement System (LASERS) effective June 30, 2014. This bill allows eligible retirees and beneficiaries to receive a 1.5% increase on benefits, with the possibility of an additional supplemental increase that will be determined later. The PBI is aimed at improving the financial well-being of retirees, particularly those who have been in the system for a significant duration, such as over one year and at least age 60.

Sentiment

Discussion surrounding SB 27 indicated a mixture of support and concern among legislators and stakeholders. Proponents argue that the supplemental benefits will provide necessary assistance to retired public employees who have contributed to state services. On the contrary, critics highlight that the increased financial obligations could strain the state retirement system's resources and could lead to budgetary challenges in the future, particularly if unfunded liabilities continue to grow.

Contention

Notable points of contention include the balance of ensuring adequate retirement benefits for those who have served in public employment versus the realities of state budget constraints. Additionally, concerns were raised regarding the actuarial soundness of the retirement fund post-implementation, especially with projected increases in liabilities affecting broader fiscal health. Opponents stress that while additional benefits support retirees, they may inadvertently exacerbate funding issues if not paired with robust revenue strategies.