Louisiana Revised Statutes 11:107.1 – Funding deposit account
Terms Used In Louisiana Revised Statutes 11:107.1
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
A. The provisions of this Section shall apply to the following statewide public retirement systems or funds, hereinafter referred to in this Section as “systems”:
(1) The Assessors’ Retirement Fund.
(2) The Clerks’ of Court Retirement and Relief Fund.
(3) The Municipal Employees’ Retirement System of Louisiana.
(4) The Parochial Employees’ Retirement System of Louisiana.
(5) The Registrars of Voters Employees’ Retirement System.
(6) The Firefighters’ Retirement System.
B.(1) There shall be established a funding deposit account for each system to which this Section applies. Such account shall be credited and charged solely as provided in this Section.
(2) The balance in the account shall be set equal to zero as of December thirty-first of the year immediately preceding the date the account is established.
(3) Notwithstanding any provision of this Subpart to the contrary, for any fiscal year ending on or after December 31, 2008, in which the board of trustees of a system elects or previously elected to set the net direct employer contribution rate higher than the minimum recommended rate pursuant to this Subpart, all surplus funds collected by the system shall be credited to the system’s funding deposit account.
C. The funds in the account shall earn interest annually at the board-approved actuarial valuation interest rate, and such interest shall be credited to the account at least once a year.
D. Notwithstanding any provisions of law to the contrary, the board of trustees of each system may in any fiscal year direct that funds from the account be charged for the following purposes:
(1) To reduce the unfunded accrued liability as prescribed in this Subpart.
(2) To reduce the present value of future normal costs for systems using an aggregate funding method.
(3) To pay all or a portion of any future net direct employer contributions.
(4)(a) Except as provided in Subparagraph (c) of this Paragraph, to provide for cost-of-living increases, in accordance with applicable law.
(b) Notwithstanding the provisions of La. Rev. Stat. 11:243(G)(1), in order to exercise the authority to grant an increase pursuant to the provisions of Subparagraph (a) of this Paragraph, an increase shall satisfy the requirements of La. Rev. Stat. 11:243(G)(3).
(c) Notwithstanding any provision of law to the contrary, the Firefighters’ Retirement System shall not provide for cost-of-living increases with funds charged from the account.
E. In no event shall the funds charged from the account exceed the outstanding account balance.
F. If the board of trustees of a system elects to charge funds from the funding deposit account pursuant to Paragraph (D)(3) of this Section, the percent reduction in the minimum recommended employer contribution rate otherwise applicable shall be determined by dividing the interest-adjusted value of the charges from the funding deposit account by the projected payroll for the fiscal year for which the contribution rate is to be reduced.
G. For funding purposes, any asset value utilized in the calculation of the actuarial value of assets of a system shall exclude the funding deposit account balance as of the asset determination date for such calculation.
H. For all purposes other than funding, the funds in the account shall be considered assets of the system.
Acts 2009, No. 296, §1, eff. June 30, 2009; Acts 2015, No. 370, §1, eff. June 30, 2015; Acts 2016, No. 208, §1, eff. July 1, 2016.