The 2020 Regular Legislative Session presented a special set of problems revolving around social distancing and the pandemic. The COVID-19 crises also provided legislators less time to meet and resolve a state budget for 2020-21. This lead to a Special Session that began on Monday evening June 1 and will conclude by June 30.
Let’s discuss what happened to retirement bills in the regular session, including the bills LRTA tracked that weren’t introduced. Here are the outcomes for the retirement bills introduced and heard during the regular session:
HB 8 (Return to Work) by Rep. Bourriaque – Signed into law. Act No. 337
LRTA Supported (with amendments)
- Establishes that the current return-to-work law only applies to retirees who have returned to work with an employer covered by TRSL on or before June 30, 2020, and to retirees who retired on or before June 30, 2010 (the original grandfathered group).
- Requires a retiree who returns to work with an employer covered by TRSL on or after July 1, 2020, to choose one of the following two options, depending on whether the retiree is re-employed in a full-time position:
- Option 1: Have earnings limited to 25% (per fiscal year) of the retiree’s final average compensation (FAC) with a reduction in the benefit if the cap is exceeded, or
- Option 2: (Only available to retirees re-employed in full-time positions)
- Have benefits suspended for the duration of re-employment.
- Return to active member status in TRSL and accrue a supplemental benefit, which will be calculated with the same formula used to determine the original benefit. If re-employed for at least 36 months, the supplemental benefit will be calculated based on the higher of the retiree’s original FAC or the FAC since re-employment. If re-employed less than 36 months, the supplemental benefit will be calculated based on the retiree’s original FAC.
- Allows a retiree returning to work under Option 1 to convert to Option 2 any time prior to or after reaching the allowable 25% earnings limitation (per fiscal year) of the retiree’s FAC.
- Establishes that any retiree, who returns to active service after July 1, 2020, and within 12 months after retirement, shall have his retirement benefits suspended for the duration of such active service or the lapse of 12 months from the effective date of his retirement, whichever occurs first.
- Allows a retiree covered by the current return-to-work law to elect to be covered by the new provisions in House Bill 8.
- Requires that any retiree who returns to active service shall have his benefit suspended if such re-employment is based on a contract or corporate contract.
- Establishes that retirees receiving a TRSL disability retirement cannot return to work under any of the proposed provisions.
- Establishes that employer return-to-work reporting requirements, including penalties for failure to report, will be the same as under current law.
Other Retirement Bills/Resolutions:
Joint, concurrent and other resolutions do not require the signature of the governor to become effective. Resolutions take effect upon adoption.
Thanks to our lobbying efforts and the shortened legislative session, the following bills were not heard during the regular session.
These bills could have negatively impacted benefits for future retirees and/or the retirement system. The bills also could have had a negative impact on current retirees.
So, what’s to come during the Special Session? The Special Session focuses primarily on fiscal matters as they relate to approving a $30 billion budget for fiscal year 2020-21. There is no retirement legislation under consideration, and we will monitor the session for any fiscal considerations that could affect retirement or our benefit plan.
I want to take a moment to thank our members for their vigilant efforts and cooperation as we navigated this session amid the COVID-19 pandemic. Thank you for reviewing the materials we sent you, responding to our calls to action and reaching out to fellow retirees to ensure they stayed informed. We could not do everything that we do without the support of our members. There’s power in our numbers!
Rodney R. Watson
LRTA Executive Director