Governor's signature clears way for COLAs
May 19, 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 Bill 5 and Senate Bill 18, also sponsored by Sen. Peacock, and summarized below.
- Senate Bill 5 requires nonāinvestment 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.
- Senate Bill 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.
To be eligible for the COLA, the following requirements must be met on or before July 1, 2016.
- Regular retiree: Must have received a benefit for at least one year and be 60 years of age
- Disability retiree: Must have been retired at least one year regardless of age
- Beneficiary of retiree: Retiree or beneficiary (or both combined) must have received a benefit for at least one year, and the deceased retiree would have been 60 years of age at the time the PBI is payable
- Survivor (non-retiree beneficiary): Must have received a benefit for at least one year and the benefits must have originated from the service of a deceased member who would have been 60 years of age at the time the PBI is payable
The benefit increase will be reflected on retirement payments starting July 1.