Bills to pay down Louisiana retirement debt stall

We live for today.

Or maybe the state should just pay their share instead of trying to take it from the workers who paid theirs.

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to pay for the benefits you have already promised???

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More precisely it's the loan they took out in the 80s to refinance the old system that needs paying back.

Once that is done, the state retirement system is on sound financial footing.

All through the 90s when Louisiana was running surplus after surplus, that liability could have been paid down ahead of time. But they didn't want to do it. They wanted to give the money to their cronies in the form of syrup mills and such.

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More precisely it's the loan they took out in the 80s to refinance the old system that needs paying back.

Once that is done, the state retirement system is on sound financial footing.

All through the 90s when Louisiana was running surplus after surplus, that liability could have been paid down ahead of time. But they didn't want to do it. They wanted to give the money to their cronies in the form of syrup mills and such.

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OR give out $2 billion in unfunded COLAs. That buys a lot of syrup mills.

Since you seem to realize the system is NOT on sound financial footing...doesn't it make sense to not give out additional benefits until you are?

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My favorite was when Bobby pushed the idea of having state workers contribute more to retirement, but the extra money would go into the general fund

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And where do you think employee payments go now?

Let's put aside the general fund mistake, since I get your point that increased employee contributions would offset employer contributions.

That is true of employee contributions in general. The 8% that employees pay now just goes to offset money the state would put in. It doesn't add any more funds. The idea is that retirement benefits are freakin' costly and employees should pick up some of that tab.

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And where do you think employee payments go now?

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LASERS? OGB?

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Since you seem to realize the system is NOT on sound financial footing

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While I implied that, I don't really think it's all that unsound currently. What's unsound is the Medicaid/Medicare systems in Louisiana. That's primarily what's driving our budget problems. And it's the budget problems that are making us fall behind in the UAL payments. Well, that and a seemingly institutional unwillingness to pay down the debt.

That said, I agree with this:

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doesn't it make sense to not give out additional benefits until you are?

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Except to say, more precisely, that there shouldn't be COLAs until the original UAL has been paid off.

But, if I'm not mistaken, COLAs are a part of the retirement agreement.

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Except to say, more precisely, that there shouldn't be COLAs until the original UAL has been paid off.

But, if I'm not mistaken, COLAs are a part of the retirement agreement

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No, they are not. No additional funds are collected for COLAs and they are not earned benefits (in LA anyway). They cannot be granted without a 2/3 vote of the legislature (that is relatively new, one of a few good reforms that has been made).

But when they are granted, they are essentially siphoning off funds that should be going to benefits that ARE covered as normal retirement benefits.

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That is true of employee contributions in general. The 8% that employees pay now just goes to offset money the state would put in. It doesn't add any more funds. The idea is that retirement benefits are freakin' costly and employees should pick up some of that tab.

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Maybe you're unaware of how the system works.

LASERS Investment Earnings
Returns generated from LASERS investments make up the largest portion of funding. Over the past 20
years, LASERS investment earnings have contributed over 41% of revenue. In FY 2010, LASERS investment
earnings accounted for more than 62% of revenue.

The many years of insufficient contributions from the State resulted in a large initial unfunded accrued liability (IUAL, or initial debt). A 1987 Constitutional Amendment required the State to begin paying the full contribution necessary to fund the normal cost of benefits for LASERS members and to amortize the initial debt for payment by 2029. Other factors have also contributed to the System’s total unfunded accrued liability (UAL, or total debt), including interest on the initial debt, investment losses, changes in assumptions, and benefit enhancements granted by the Legislature without funding.

Because of this, the State contribution consists of two components: accruing benefits and the debt payment. The debt payment makes up the greatest percentage of the State’s contributions each year. As an example, for the 2010-2011 fiscal year, the total State contribution of 22% consists of 6.56% for the cost of employee benefits and 15.44% for the debt payment. That means over 70% of what the state paid to LASERS that year was for the debt.

There is a misconception that employer contributions to LASERS comprise a significant portion of the State operating budget. In fact, State payments to the retirement system are approximately 2% of the overall operating budget.

Additionally, LASERS continues to be a major economic driver for our State.
LASERS paid more than $860 million in benefits and refunds in FY 2010.
Over 90% of LASERS retirees live in Louisiana, resulting in a $782 million impact on our State and hometown economies.
LASERS invests over $230 million in Louisiana companies.

It is also important to keep in mind that the average rank and file benefit is only $19,140 per year. LASERS members do not participate in Social Security. LASERS ensures their retirement security.

LINK

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All those state retirement plans should be defined contribution

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Why?