Lawmakers’ Retirement Abuse Curtailed

The Louisiana Legislature continued its efforts at the last session to derail the gravy train that former lawmakers have ridden to lucrative retirement benefits. The reform effort began in earnest in 1996.

A law passed in 1976 was typical of how legislators have managed to manipulate the retirement system. Act 601 by then-Rep. Billy Tauzin allowed lawmakers who were in the Louisiana State Teachers Retirement System to count legislative time when figuring their teacher retirement pay.

That gave legislators an advantage over teachers who had to work full-time to qualify for retirement benefits.

Fortunately, the benefit lasted only one year. Rep. Shady Wall in 1977 sponsored Act 743 that said legislators could count only time in one system, not both.

Legislators prior to Jan. 2, 1997, were able to retire with 16 years of legislative service — and nothing else — and receive 56 percent of their highest three-year average salary. Their benefits were 3.5 percent of their annual salary for their three highest years, multiplied by the number of years of service.

Most retirees have to compute their retirement with an accrual rate of only 2.5 percent.

Those lawmakers who had worked in other government fields could retire earlier if they paid into the retirement system for each of those other years.

The best way to enhance retirement pay was to get a highpaying government job after leaving the Legislature, work at it for at least three years and use that salary and legislative service time to figure benefits.

A half-dozen lawmakers used that ploy when Mike Foster was governor. However, Foster was no different than previous governors who all made a habit of helping exlegislators.

Some of those former legislators were qualified for the jobs they were given. However, you have to wonder whether better-qualified individuals may have been denied an opportunity to compete for those positions.

Retirement pay for part-time officials came to an end in 1996 when the Legislature and the voters by a 70-percent margin approved a constitutional amendment ending the benefits. Among those affected were legislators and members of police juries, parish councils, school boards, levee boards, city councils and town councils and aldermen and constables.

Any of those officials who were in office on Jan. 1, 1997, were excluded from the new restrictions. However, those serving on Jan. 2, 1997, and afterwards were no longer eligible for retirement benefits.

Believe it or not, some legislators are still eligible for retirement benefits because of their long service. And the benefits keep growing as long as they are in office. Some have even taken higherpaying jobs that will enhance their retirement pay.

Rep. Kevin Pearson, R-Slidell, sponsored legislation this year that puts an end to some of those shenanigans. It says any former legislator who gets elected again on or after July 1, 2011, can only use 2 percent instead of 3.5 percent to compute his or her retirement benefits.

Rep. Neil Abramson, D-New Orleans, during debate on Pearson’s bill asked why he didn’t reduce that 2 percent to zero. Pearson said it’s a constitutional issue, but he may pursue that possibility at a future session.

Legislators elected after July 1, 2011, also won’t be able to double-dip by using legislative service time to enhance their retirement when they take a higher-paying government job.

Act 377 is clear when it says a person holding another government job “shall not include any compensation for his service in the Legislature occurring on or after July 1, 2011…”

None of the provisions of the new law apply to legislators serving on June 30, 2011, who were grandfathered in 1997.

A number of Southwest Louisiana legislators have over the years declined to participate in the legislative retirement system, even though they were eligible. And that is to their credit.

Legislators and other part-time officials elected on or after Jan. 2, 1997, have not been able to participate in the state retirement system.

The legislative retirement issue has surfaced in the current campaign for Calcasieu Parish tax assessor. Some mistakenly believe that one of the candidates — state Sen. Willie Mount, D-Lake Charles — would enhance her retirement by holding the higher-paying job.

Mount was first elected to the Legislature in 1999 and didn’t take office until 2000. She is term-limited and has no legislative retirement.

I asked Mount about her 6 /2 years as mayor of Lake Charles. She said the city withheld retirement contributions from her pay, but she withdrew those funds when she left office. The city didn’t contribute to her retirement, she said.

Assessors need 12 years of service and be 55 before they qualify for retirement benefits.

The state’s four state-backed retirement systems are in debt to the tune of $18 billion. The special interest legislation like some of that mentioned here isn’t responsible for the major portion of that debt, but it is definitely part of the problem.

Let’s hope some of the steps taken during the recent session to curb retirement abuse continue. The effort so far has only scratched the surface, but it’s a move in the right direction.

Jim Beam, the retired editor of the Lake Charles American Press, has covered people and politics for more than five decades. Contact him at 494-4025 or [email protected].

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