Louisiana State Employees' Retirement System, Baton Rouge, will propose a change in the calculation method that determines employer contributions, confirmed Deputy Director Maris E. LeBlanc.
Contributions to the $9.3 billion system by the state would be cut by $40 million the first year, Ms. LeBlanc said in a telephone interview. The effect on contributions in future years cannot currently be calculated accurately due to variables, she said.
The change, which needs to be approved by the Legislature, is being proposed because of expected changes in measuring liabilities under the Government Accounting Standards Board rules.
The current state law requires systems to calculate liabilities by increasing normal costs for each participant on an annual basis as they get closer to retirement; the proposal keeps the normal cost the same annually as a percentage of a participant's career rather than changing it annually.
The Legislature is scheduled to go into session on March 12.