BATON ROUGE, La. (AP) — Louisiana Gov. Bobby Jindal’s push to make thousands of state workers pay more and wait longer for their retirement benefits is planned for an overhaul by senators who are resisting some of the changes proposed.
The Senate diverted the bills to a second committee, where they are expected to get a heavy rewrite Monday to shrink and phase in the increased payments and lessen the blow of the impact to workers who have been state employees for decades.
“That will put them in the public realm so that way everybody will see them in their semifinal form,” said Sen. Elbert Guillory, the Opelousas Democrat who is sponsoring the measures for Jindal.
The retirement proposals have faced opposition from lawmakers and constitutional questions. They have remained stalled on the Senate calendar for weeks as Senate leaders, Guillory and the governor’s office haggled behind the scenes over ways to make the proposals more palatable — and adjustments that could win enough support for passage.
The three most significant bills for current workers were shuttled to the Senate Finance Committee, Guillory said, so changes could be made there before they are taken up on the Senate floor.
Guillory is floating changes that would delay the start date of all the measures until July 1, 2013, and would make the delayed retirement age applicable only to workers with fewer than 20 years of state employment.
Jindal spokesman Kyle Plotkin said the governor supports Guillory’s proposed adjustments.
Opponents say the changes won’t wipe away the constitutional problems and expect court challenges if they pass.
“It’s clear that he’s trying to moderate the harshness of the bills, and I certainly appreciate that. At the same time, he’s not able to moderate the constitutional impediments,” said Cindy Rougeou, executive director of the Louisiana State Employees Retirement System.
Jindal says adjustments to the state’s retirement offerings are needed to limit the growing costs of pension programs that are $18 billion short of the funding they’ll need to pay for all the benefits promised.
Lawyers for the retirement systems and a legal analysis done for the Legislature said the changes would violate provisions in the Louisiana Constitution that protect pension benefits for state employees.
Rougeou also questioned whether the bills — if changed as proposed — would save much money.
“It seems like they’re trying to make it closer and closer to the existing structure, so I wonder if there’s really much savings,” she said. “So, I’m not sure what would be accomplished.”
Under amendments proposed by Guillory and sent out in an email, the amount state workers would pay toward their retirement would grow from 8 percent of their salary to 10 percent over four years from 2013 until 2016.
Another bill that would require employees to work longer to get their full retirement benefits, depending on how many years they’ve been in the system and their current age, would be tweaked so that employees with 15 to fewer than 20 years working for the state could retire at 55, employees with 10 to fewer than 15 years on the job at age 57, employees with 5 to fewer than 10 years in state employment at age 60 and those with fewer than five years at age 65.
New hires would have to wait until the age of 67 to retire with full pension benefits. Anyone with 30 years of state employment could still retire when hitting that mark under existing provisions, according to changes suggested by Guillory.
A third measure that would calculate the monthly retirement payment on an employee’s top five years of salary instead of three years would be phased in so that the full change would apply to people who retire on or after July 1, 2015, under the proposed amendments.
“With this present plan that we have, I think that state workers will really like these bills,” Guillory said.
As many as 50,000 rank-and-file state workers and public college employees could be affected by the pension bills, depending on how the measures take shape.
The governor’s proposals center only on certain state employees. They don’t include elementary and secondary school system employees or state police, prison guards and anyone else deemed in hazardous duty.
Jindal also is pushing to create a cheaper investment account similar to a 401(k) plan for state employees hired after July 1, 2013, instead of a monthly retirement payment based on their salaries and years of employment. That proposal won narrow passage from the House this week and heads to the Senate for debate.