The Louisiana Supreme Court struck down as unconstitutional a recent law establishing a cash balance plan for some employees of three of the state's pension plans.
The law, signed by Gov. Bobby Jindal, established a cash balance plan for selected employees hired on or after July 1, 2013, in the $13.9 billion Louisiana Teachers' Retirement System, the $9.6 billion Louisiana State Employees' Retirement System and the $1.5 billion Louisiana School Employees' Retirement System, all of Baton Rouge.
The ruling on June 28 echoes the January ruling of Judge William Morvant in the 19th Judicial District Court for the Parish of East Baton Rouge.
The Louisiana Retired State Employees Association had filed a lawsuit last August alleging the law was unconstitutional because the 68 votes it received in the Louisiana House of Representatives on May 30, 2012, to move the bill to the Louisiana Senate were not sufficient due to a section of the Louisiana Constitution that requires a two-thirds majority to enact benefit provisions for members of any public retirement system.
It would have required 70 votes to reach that two-thirds majority.
Mr. Jindal said in a statement: “We are going to work with legislators on the best way to proceed. We think the cash balance plan is good for the people of Louisiana because it helps get our retirement liabilities under control, protects taxpayers and provides new state employees with a portable retirement account that realizes investment earnings.”