Gov. Bobby Jindal signed Sunday legislation that gives the first bump on monthly retirement checks for about 100,000 retired state employees in about six years.
The package linked the 1.5 percent increase in retiree pension checks to passage of separate legislation that would limit the amount and frequency of future increases. The increase represents roughly $350 average annual benefit increase, according to the governor’s office.
“It’s a victory on a number of different fronts,” said state Rep. Joel Robideaux, R-Lafayette.
Retirement system investment earnings over an amount set in law go into the special accounts the Legislature set up for the purpose of COLA granting.
Robideaux sponsored House Bill 1225, which would require more of the systems’ investment earning to go into reduction of their unfunded accrued liabilities — money required to fill commitments made to retirees and current members over time.
“This legislation is a fiscally responsible way to give retirees a COLA and to reform the systems to make them financially stable for future retirees,” Jindal said.
If the system is less than 55 percent funded, no benefit increase would be granted. If it’s 55 percent but less than 65 percent funded, and the Legislature hasn’t granted an increase in the prior year, a 1.5 percent raise could be granted.
The systems would have to be 85 percent or greater funded to get a 3 percent benefit increase.
HB1225 had to pass in order for the COLAs into effect.
Jindal also signed the measures that actually put the cost of living adjustments into effect: Senate Bill 18 grants COLAs for members of LASERS, the Louisiana State Employees’ Retirement System; Senate Bill 16 gives the raises to retired state police; Senate Bill 19 for Louisiana School Employees’ Retirement System; and Senate Bill 21 for Teachers’ Retirement System of Louisiana.