Officials representing retired government employees voiced optimism that their charges may actually get a cost-of-living bump in monthly benefits checks — despite worries over the state’s precarious fiscal situation — after a Louisiana House committee Thursday approved legislation granting an increase for most state pensioners.
“It looks really good,” said Rodney R. Watson, executive director of the Louisiana Retired Teachers Association, articulating the sentiment being voiced by his colleagues in a State Capitol hallway moments after the House Retirement Committee favorably recommended House Bill 32 for consideration by the full House.
The measure is virtually identical to legislation the full Senate approved Wednesday night, meaning that the cost of living adjustment, or COLA, is near the end of its legislation journey. Gov. John Bel Edwards has indicated he would sign the legislation, which passed last year but was vetoed by then Gov. Bobby Jindal.
The only difference between the House and Senate versions of the increase is that the Senate bill attaches the success of the COLA with the passage of two other measures aimed at tweaking the system. But Maureen Westgard, executive director of the Teachers’ Retirement System of Louisiana, said the four retirement systems and the associations that represent retirees have said they support the two revamp bills attached to the Senate’s cost of living increase measure.
Nobody voted against Senate Bill 2 as it went through two committees and a vote by the full Senate. Only one legislator has voted against the idea of COLA so far, — Central Republican Rep. Barry Ivey, a member of the House Retirement Committee — voted against the bump in monthly benefit checks for about 125,000 retired state workers, teachers, school employees, troopers and others, who are over the age of 60 and have been retired for at least a year.
The four systems covering the pensions of state workers and public teachers would give a 1.5 percent increase. Retirees in the systems that handle the pensions for State Police employees and public school employees would give a 2 percent bump.
The average monthly increase would be about $30 but could vary based on the circumstances of individual retirees and the retirement systems to which they belong.
The money comes from an account where excess investment earnings were deposited and the $380 million ultimate cost would not come from the state budget, which is $750 million in the red.
Ivey quoted from the reports of credit agencies that recently downgraded Louisiana’s finances — a move that makes borrowing money more expensive for the state. Fitch’s, one the agencies, made special note of the debt owed by the retirements systems, which has been hovering around $20 billion, and called the reforms instituted by legislators a couple years “modest.” He said the retirement systems need to work on strengthening their finances and that no law promises retirees should receive cost of living adjustments.
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