Sweeping retirement changes deferred in Louisiana Legislature
Sweeping reforms to the way the state government pays its retired employees were withdrawn Thursday when the sponsor for the four-bill package said he saw the writing on the wall.
Central state Rep. Barry Ivey, who sponsored the four bills that would have worked in concert, said the central point is to change state government retirement from a traditional system that pays retirees a monthly benefit for the rest of their lives to a hybrid model that would include both a pension and a 401(k)-type program, in which the retiree gets only the money invested over time plus any earnings.
Ivey, a Republican, said his plan would put the retirements of state employees more in line with what is offered in the private sector. At the same time, Ivey argued that the hybrid plan would cost taxpayers less and chip away at the near $20 billion difference between the promises made to retirees by the state and the amount of money available to pay those debts, which is called unfunded accrued liability.
Critics, and there were many attending the hearing, disagreed, saying the revamp would cost new state employees more while lowering their benefits in retirement.