House Bill No. 42, introduced by Representative Bacala, aims to establish a phased retirement program within the Teachers' Retirement System of Louisiana. The bill amends existing law to create a framework for this program, allowing eligible members of the retirement system to participate in a phased retirement arrangement with their respective public postsecondary education institutions. Key provisions include a reduced retirement benefit during participation, which is calculated based on the participant's full regular benefit amount and the percentage of work effort performed. Upon completion of the program, participants will receive their full retirement benefits. Additionally, both the participant and employer will not be required to make contributions to the defined benefit plan during the phased retirement period.

The bill also outlines the responsibilities of the public postsecondary education management boards, which are authorized to develop and implement their own phased retirement programs. These programs must adhere to specific guidelines, including voluntary participation, eligibility criteria, and a defined participation period of 12 to 36 months. A memorandum of understanding detailing workload and expectations must be executed between the employee and the institution. Furthermore, starting July 1, 2027, the employer will be responsible for paying the full amount of the monthly administrative fee associated with the program. The costs incurred from this legislation will be funded through additional employer contributions, ensuring compliance with the Louisiana Constitution.

Statutes affected:
HB42 Original: 11:927(F)(2)
HB42 Engrossed: 11:927(F)(2)