Compliance January 25, 2013
Court Strikes Down La. Cash Balance Plan
January 25, 2013 (PLANSPONSOR.com) – A Louisiana court has found the approval of a cash balance plan for future state workers to be invalid.
Reported by Rebecca Moore
The district court judge agreed with the Retired State Employees Association of Louisiana, which claimed in its lawsuit that the plan is unconstitutional because it did not get a two-thirds vote in the state House of Representatives. The lawsuit says any provision involving a public retirement system that is deemed to carry a price tag requires a two-thirds vote for passage (see “Association Challenges Louisiana Cash Balance Plan”).
Governor Bobby Jindal said in a statement that he would appeal the ruling, according to news reports.
The Louisiana State Employees Retirement System (LASERS) board had asked the Legislature to delay implementation of the cash balance plan due to concerns that federal issues involving the Internal Revenue Service (IRS) and Social Security status of the cash balance plan would not be resolved before the new law was to take effect in July of this year (see “LASERS to Ask for Delay of Cash Balance Plan”).