BATON ROUGE, La. (AP) - The battles of past legislative sessions tied to Gov. Bobby Jindal’s failed push to overhaul the state employee retirement system won’t be fought again when the next regular session begins Monday.
Jindal has abandoned attempts to make state employees work longer for reduced benefits and to move to a 401(k)-style pension system, which the Louisiana Supreme Court ruled had not been legally approved.
The Advocate reports (https://bit.ly/1fGZX6n ) that leaders of Louisiana’s two largest statewide retirement systems are predicting that lawmakers will shift attention to granting 1.5 percent cost of living adjustments to retirees and discussing ways to shrink retirement debt.
“I think the focus will be on reducing debt and paying COLAs,” said Cindy Rougeou, executive director of the Louisiana State Employees Retirement System or LASERS.
Many of the 100,000 retiree members of the four statewide systems - which also include the School Employees Retirement System and the State Police Retirement System - haven’t received a boost in their pension checks in at least five years.
“Each year, there’s kind of a theme. I think this year will be the COLA year,” said Maureen Westgard, executive director of the Teachers Retirement System of Louisiana.
All four systems have registered better-than-expected investment earnings that exceeded benchmarks. The positive earnings picture allowed some money to be put into the savings accounts from which retiree raises are funded.
Meanwhile, the systems have a $19 billion gap between money on hand and the amount it would cost to pay for all promised pension benefits over time. The liability is largely due to past administrations and lawmakers providing pension benefits without adequately funding them and escalating interest on that debt.
Westgard said she expects a “big policy discussion” over COLAs because the funding system diverts investment earnings away from paying of systems’ debts.
A proposal by House Retirement Committee Chairman Kevin Pearson, R-Slidell, would take money left over after the 1.5 percent COLA is paid and use it toward payments on the unfunded accrued liability.
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Online:
Louisiana Legislature: www.legis.la.gov
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Information from: The Advocate, https://theadvocate.com
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