§875. Pension accumulation fund; description and composition of funds; normal and accrued liability contributions; determination

The pension accumulation fund shall be the fund in which shall be accumulated all reserves for the payment of all pensions and other benefits payable from contributions made by employers and, in applicable cases, from the proceeds of one-half of one percent of taxes collectible in all parishes except the parish of Orleans. Contributions to and payments from the pension accumulation fund shall be made as follows:

(1) On account of each member there shall be paid annually into the pension accumulation fund by employers from the preceding fiscal year an amount equal to a certain percentage of the earnable compensation of each member to be known as the "normal contribution", and an additional amount equal to a percentage of his earnable compensation, to be known as the "accrued liability contribution". The percentage rate of such contributions shall be fixed on the basis of the liabilities of the retirement system as shown by actuarial valuation; provided, however, that the total percentage rate of such contributions shall not be less than eleven and eight-tenths percent.

(2) On the basis of regular interest and of such mortality and other tables as shall be adopted by the board of trustees, the actuary engaged by the board to make each valuation during the period over which the accrued liability contribution is payable, immediately after making such valuation, shall determine the uniform and constant percentage of the earnable compensation of the average new entrant, which if contributed on the basis of compensation of such new entrant throughout his entire period of active service would be sufficient to provide for the payment of any pension payable on his account. The percentage rate so determined shall be known as the "normal contribution" rate. After the accrued liability contribution has ceased to be payable, the normal contribution rate shall be the percentage rate of the earnable salary of all members obtained by deducting from the total liabilities of the pension accumulation fund the amount of the funds in hand to the credit of that fund and dividing the remainder by one percent of the present value of the prospective future salaries of all members as computed on the basis of the mortality and service tables adopted by the board of trustees and regular interest. The normal rate of contribution shall be determined by the actuary after each valuation.

(3) Immediately succeeding the first valuation the actuary shall compute the percentage rate of the total annual compensation of all members which is equivalent to four percent of the amount of the total pension liability on account of all members and beneficiaries which is not dischargeable by the aforesaid normal contribution made on account of such members during the remainder of their active service. The percentage rate originally so determined shall be known as the "accrued liability contribution" rate.

(4)(a) In addition to the contributions to be made to and payments to be made from the pension accumulation fund in accordance with the provisions of Paragraphs (1), (2) and (3) of this Section on account of each member who contributes to the fund on the basis of total salary, there shall be paid into the pension accumulation fund an amount which shall equal one-half of one percent of the aggregate amount of the taxes shown to be collectible by the tax rolls of each respective parish except the parish of Orleans, which amount shall be deducted by the sheriff and ex officio tax collector for each of such parishes and turned over to the board of trustees periodically at the same time as said sheriff disburses funds to the tax recipient bodies of his respective parish. The first deductions required to be made under this provision shall commence with the collection from the 1962 tax roll and shall be made annually thereafter.

(b) If at any time the amount thus required to be deducted and paid over to the board of trustees results in a larger or smaller aggregate amount than the amount required for the purposes for which such funds are to be used, as provided by this Chapter, then the board of trustees of the system shall instruct the sheriffs and ex officio tax collectors of the parishes to deduct for this retirement system a smaller or larger percentage than is herein provided not to exceed a total deduction of more than one percent.

(c) The percentage rate of the contribution to be made to the system in accordance with this Paragraph (4) which shall be credited in the pension accumulation fund to "normal contribution" and the percentage rate to be credited to "accrued liability" shall be determined by the board of trustees, based upon such actuarial valuation for the purpose as the board shall direct.

(5) With respect to each member of this system who is a participant in the Louisiana Educational Employees Professional Improvement Program, the employer's contribution shall not be computed on the compensation received pursuant to R.S. 17:3601 et seq. until July 1, 1982, and shall be computed including such compensation every year thereafter.

Amended by Acts 1959, No. 54, §6; Acts 1962, No. 186, §1; Acts 1965, No. 6, §1; Acts 1970, No. 28, §5; Acts 1981, No. 935, §1, eff. July 1, 1981; Acts 1982, No. 171, §1; Acts 1987, No. 724, §1; Redesignated from R.S. 17:696 by Acts 1991, No. 74, §3, eff. June 25, 1991.

{{NOTE: SEE ACTS 1987, No. 724, §2 - SPECIAL EFFECTIVENESS.}}