Regular Session News #21: Governor signs COLA bills, return-to-work bills move forward

Jun 1, 2016

Today, Gov. John Bel Edwards signed three bills into law that, taken together, allow TRSL to pay a 1.5% permanent benefit increase (also called COLA) to eligible TRSL retirees and beneficiaries on July 1. Senate Bill 2, sponsored by Sen. Barrow Peacock, authorizes the 1.5% COLA calculated on the first $60,000 of the retirement benefit. Granting of the COLA was contingent upon passage of Senate bills 5 and 18, also sponsored by Sen. Peacock, and summarized below:

• SB 5 requires non‐investment related administrative expenses to be funded directly through employer contributions beginning the first fiscal year in which this change will not increase the projected employer contribution rate.
• SB 18 clarifies provisions created in Act 399 of 2014 regarding excess investment earnings, employer contributions, and cost-of-living adjustments (COLAs). SB 18 also addresses the System’s amortization period for changes, gains, losses and allocations to the experience account, and authorizes re-amortization at certain times.

For more information on COLA eligibility requirements, please see the criteria listed here.

In other action today, the Senate retirement committee favorably reported the following bills affecting TRSL:

• HB 14 (Pearson) replaces the chair of the House retirement committee with any member of the committee appointed by the House speaker to serve on each state and statewide retirement board.
• HB 32 (Jones) grants a 1.5% benefit increase to eligible TRSL retirees and beneficiaries, effective July 1, 2016. The committee amended the bill relative to the Louisiana State Police Retirement System (LSPRS). (Refer to www.TRSL.org for information about eligibility requirements.)
• HB 60 (Miguez), as amended*, adds “school nurse” to the list of retirees who can return to work and continue to receive a benefit check, subject to a 25% of benefit earnings limitation.
• HB 61 (Hoffmann), as amended*, adds “school psychologist” to the list of full-time critical shortage positions in which a retiree can return to work without a restriction of benefits.
• HB 907 (LeBas), as amended*, increases from 25% of benefit to 50% of benefit, the earnings allowed for TRSL retirees who are re-employed as substitute classroom teachers filling a vacancy created by extended leave.
• HB 1093 (Ivey) requires the legislative auditor to report on the actuarial assumptions and funded ratios of each of the four state public retirement systems, and determine the appropriateness of these assumptions at least every five years.
• HCR 12 (Franklin) asks Congress to consider eliminating the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) Social Security reductions.

*House bills 60, 61, and 907 were all amended to increase the waiting period between retirement and returning to work from 12 months to 36 months for non-critical shortage positions. The re-employment of retirees who have met the 12-month waiting period and returned to work prior to May 15, 2016, would continue to be governed by current law.

A complete list of legislation impacting TRSL, including the position taken by the TRSL Board of Trustees on each bill, is available on the Legislation page of our website.