23 May 2011

Committee action, May 23: SB 4, SB 6

SB 6 by Sen. Butch Gautreaux would force charter schools to pay off a proportion of the unfunded accrued liability for retirement if they leave that system. Work by the Senate Retirement Committee already had begun on the bill and after additional time to consider things, the committee undid its amending from last week and then adopted other amendments that incorporated them. The most difficult seemed to be over how to define “proportionate share.”

Sen. A.G. Crowe raised a point of order that as the bill’s sponsor also was the chairman of the committee, that it would be better for him to turn the committee’s operation over to the vice chairman to keep the confusion to a minimum when dealing with his bill. Gautreaux said he had run the committee this way for eight years and was not going to change it now.

Opponents testified that they weren’t necessarily against the concept, but they thought without specifics, in terms of a formula to figure out just what this cost could be, that they couldn’t be in favor of the bill.
However, the amendment set by Sen. Conrad Appel they thought might have improved the picture but as these had just become public, they needed a chance to review them. This included a representative from Gov. Bobby Jindal’s office, who mentioned this created problematic situations regarding the Recovery School District and charters as standalone institutions that the amendments did not seem to address. However, they did like the reduction in scope of liability for only those employees of the charter school at the school, not the historical record of the school or its employees.

Some of the witnesses asked for perhaps 24 hours, but Gautreaux said they were going to move ahead. Crowe, who had expressed sympathy with waiting, then moved to defer consideration but he received no second.

Supporters who testified, representing school superintendants and teachers unions, thought anything that reduced what costs districts paid was good and pointed out that many charter schools had willingly entered the system, as they have a choice whether to when moving into charter status. Gautreaux pointed out an analogy made by committee member and banker Sen. Fred Mills that the situation currently without this legislation was like someone who couldn’t pay back a loan saying other borrowers could cover them. Supporters also pointed out there was a constitutional obligation to keep an actuarially sound retirement system.

Without opposition, the panel then voted favorably on it.

SB 4 by Sen. Buddy Shaw would allow, when a public safety employee in the Municipal Police Employees Retirement System has reached 100 percent of his retirement and was not drawing it, if elected by the employee that retirement would not have to be paid into by the employer but instead by the employee. He said this would save money for the employing agency.

Sen. Fred Mills asked if this applied retroactively, and told it was not. He also questioned whether there wouldn’t be a net actuarially loss because technically the employer would not pay in. With the ensuing confusion on these points, and that the Committee had a 24-hour rule on amendment submission making any amendment offered to address these concerns impossible, Shaw asked for and got a deferral of the bill for the next meeting.

This won’t take long if you vote right.
Shaw, when beginning discussion of his SB 10 of his that would increase chances of retirees to get cost-of-living increases.

If I don’t vote for this, locks would be changed.
Sen. Elbert Guillory, speaking of his 102-year-old mother who lives with him who would be the beneficiary of Shaw’s bill.

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