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On January 26, 2024, HB 42 was filed to eliminate MPERS' retirement, disability, and survivors' benefits for essentially all employees hired after January 1, 2025.
HB 42 would do this by providing that a municipality is an "employer" only if it enters an agreement with MPERS to extend the benefits of present law to its employees. If the employer does not enter into an agreement, its police officers will only be covered under Social Security, which provides much lower benefits than MPERS.
Will employers enter into such an agreement if the bill becomes law? Hopefully, but don't count on it. Due to required payments on the oldest unfunded accrued liability, the employer contribution rate will be at its highest over the next 11 years. Given that there's no deadline to enter into an agreement by, why not wait until year 12?
By effectively closing the plan, the bill could cause the employer contribution rate to exceed 100 percent. Overall contributions to MPERS could decrease, leaving less money to pay retirees.
The bill would also add 4 mayors (designated by the Louisiana Municipal Association) to the MPERS' board. This is addition to the 2 mayors already on the board. It would dilute police officers' input into their own retirement system (less than half of the trustees would be actual MPERS' members or retirees) and give MPERS a whopping total of 19 trustees, the most of any retirement system in the State.
Further, the bill limits the amount of delinquent contributions that MPERS can claim and makes it harder to collect delinquent contributions from available funds on deposit in the state treasury for the delinquent employer and via litigation. Again, these provisions would increase non-delinquent employers' costs and decrease retirees' COLAs.
Additionally, another bill, HB 52, would change the required venue for all legal actions involving MPERS from East Baton Rouge Parish to the district court of the judicial district in which the employer is located (in other words, they are looking for "hometown cooking"). Actions involving all other retirement systems would be left unchanged.
This bill would increase legal costs and is likely a response to MPERS filing lawsuits to force municipalities to enroll their police officers and pay their delinquent contributions (aside from the obvious, their failure increases law-abiding employers' costs and decreases retirees' COLAs). Several employers thought that the lawsuits should be heard in their home parish rather than East Baton Rouge. The Louisiana Supreme Court thought otherwise.
If you have concerns about these bills (and anyone who is receiving, or who wants to receive, retirement benefits should), please contact members of the House Retirement Committee, which will initially hear the bill. Their contact info can be found on the committee's website.
You can also find your own representatives by using this tool. They would appreciate your input.
Finally, you may want to consider expressing your concerns to the Louisiana Municipal Association at (800) 234-8274 or via this webpage.
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