Faculty Senate President Kevin Cope plans to push for legislation to remedy what he calls a failing retirement and benefit system for full-time professional University employees.
During the past four years, total contribution to employee retirement carriers have slumped as University payments toward a state “accrued liability” have steadily increased.
Full-time professional University employees participate in two main retirement programs managed by the Teachers Retirement System of Louisiana, or TRSL. The most popular program, according to Cope, is the Optional Retirement Package, or ORP.
The ORP sees both employees and the University contribute a percentage of an employee’s salary toward his or her retirement fund.
Cope’s dissension with this plan is funds that are actually making it to employee accounts are dwindling. The TRSL is tied to a $10 billion unfunded accrued liability — or deficit — which is being paid down by contributions from many state organizations, including the University.
Jason Droddy, assistant vice chancellor of legislative and external affairs, attributed the hole to certain groups with existing financial liabilities being added to the retirement system along with certain rules within the system that build up unpaid costs.
While the employee side of the retirement contribution has remained steady, the employer contribution — made by the University — has increased in the past four years, according to TRSL statistics.
At the same time, the amount of the employer contribution going to the unfunded liability has increased by 4.9 percent, and the contribution to employee coffers has decreased by 1.2 percent.
Cope equates the decreases to a pay decrease while the University is actually paying more.
Droddy said the University’s contribution to this unfunded liability is a heavy majority of the oft-mentioned unfunded mandates. The last increase in employer contribution to the liability cost the University about $10 million at the beginning of this fiscal year.
Droddy said the University expects to take another similar unfunded mandate or “hidden cut” in the next fiscal year.
“This will become a major problem to the growth and improvement and recruitment operations at LSU because as word gets around of this it will become increasingly hard to recruit employees and increasingly difficult, especially to recruit senior employees,” Cope said.
 
—-
Contact Xerses A. Wilson at [email protected]