The Retirement Program (“ORP” and “TRSL”) Controversy
During the summer of 2009, when faculty were engaged in summer teaching and research projects, the Teachers’ Retirement System of Louisiana (TRSL) quietly but dramatically cut the rate at which employer contributions to defined-contribution retirement programs passed through to employee (faculty) retirement accounts. The reduction, from 6.95% to 5.76%, was the largest in the history of the ORP (a reduction of 18% ), which had already established a long-term trend toward declining benefits. Since the discovery of the retirement program problem, the rate of divergence—the simultaneous increase in employer contributions and decrease in employee receipts—has continued to worsen, with the 2012–2013 fiscal and academic years setting new but unhappy records in this area. TRSL has attempted to explain this reduction with respect to certain actuarial assumptions but continues to use the monies taken from ORP participants to resolve the unfunded liability of the defined-benefit plan, from which ORP participants receive no benefits. Meanwhile, the defined-benefit plan teeters on insolvency, with retirees in that program having no prospect of cost-of-living adjustments.
List of retirement system management boards for regional and selected other universities (showing the novelty of a higher education retirement plan that is nested within a much larger teachers’ plan) [September 2009]
Video of testimony by LSU and LSU System Faculty Senate President Kevin L. Cope regarding House Bill 331, permitting re-entry into the TRSL defined-benefit plan after participation in the ORP definied-contribution plan (after video begins playing, move your player scroll bar to 3:19:20 to reach the beginning of the testimony on HB331) [May 2010].
Announcement (via LSU HRM) of 2012–2013 ORP and TRSL rates: employee normal cost; employer normal cost; unfunded accrued liability; total cost (lowest employee share since program inception) [July 2012]
Current TRSL tables showing declining contributions from employer payments [no date] (CAUTION: The tables are difficult to follow and interprets; scroll down and look for the ORP, not the TRSL, contribution information in the lower-right corner of this long page)