FAQs

Yes. Going forward, MPERS doesn't plan to offer any settlement under any terms more favorable than the amended resolution's. The example below shows why municipalities should rush to meet the relevant deadlines and take advantage of these terms as soon as possible. 

First, let's illustrate what the employer would normally owe, absent a settlement. Under R.S. 11:2227(J)(2), any employer who becomes delinquent for a period in excess of one hundred and eighty days in the collection and remittance of the amounts due as monthly contributions is liable for the greater of (1) the amount of employer and member contributions owed plus interest charged at the legal rate from the date the payment became delinquent plus a 25% penalty and (2) an amount equal to the actuarial cost of a purchase of the service credit for which contributions were not timely paid, as calculated by the system's actuary pursuant to R.S. 11:158(C). Further, the employer that failed to transmit the required contributions in a timely manner shall also reimburse the system any legal and actuarial fees paid by the system.

Next, let's turn to what would be owed under a settlement authorized by the amended resolution. One particular delinquent employer has a single employee that it failed to enroll since January of 2015. Under R.S. 11:2227(J)(2)(c), as of September 30, 2023, the employer owed MPERS $267,510.63. That amount is obviously past due and increases each day. It must be paid in full immediately, and the employer has already been sued by MPERS.

If the employer entered into a settlement under the amended resolutions's terms, that amount would be immediately lowered by the sum of $35,648.43 (judicial interest) and $46,289.94 (25% penalties), which is $81,938.37. That would leave the employee and the employer respectively owing principal amounts of contributions totaling $44,577.74 and $140,582.02. Those amounts would be able to be paid off over 48 months with interest at 6.75%, which would result in respective monthly payments of $1,062.31 and $3,350.13.

However, to protect MPERS, the employer would have to pay MPERS the difference between the (1) the actuarial value of service credit for the employee (calculated through date benefits begin) and (2) the sum of the employee and employer contributions and associated interest paid by employer on behalf of employee, within 30 days of receipt of request from MPERS, IF AND ONLY IF the employee sticks around and eventually applies for payment of benefits by MPERS for retirement or disability, or dies and his survivors become eligible for benefit payments.

As you can see, the savings can be significant. But they start disappearing on December 2, 2023.

Under a settlement pursuant to the amended resolution's terms, the delinquent employer would pay (over up to 12 months) 100% of the principal amount of employer contributions, with interest at MPERS’ assumed actuarial rate of return calculated with a beginning date of July 1, 2023. However, if any of these former employees applies for benefits, within 30 days of notice, the former employer must pay MPERS the difference between past due payments credited and actuarial value of service credit (calculated through date of retirement).

This discount is still very large. Remember, under R.S. 11:2227(J)(2), any employer who becomes delinquent for a period in excess of one hundred and eighty days in the collection and remittance of the amounts due as monthly contributions is liable for the greater of (1) the amount of employer and member contributions owed plus interest charged at the legal rate from the date the payment became delinquent plus a 25% penalty and (2) an amount equal to the actuarial cost of a purchase of the service credit for which contributions were not timely paid, as calculated by the system's actuary pursuant to R.S. 11:158(C). Further, the employer that failed to transmit the required contributions in a timely manner shall also reimburse the system any legal and actuarial fees paid by the system.

To be eligible for a settlement authorized by the amended resolution, sufficient records (for the period beginning January 1, 2013 and ending on the last day of the month that fell before the month in which the records are provided to MPERS) must be received by MPERS on or before December 31, 2023.

Municipalities that either chose not or do not have sufficient payroll records to provide will not be able to take advantage of the amended resolution’s settlement terms. Since many initial records sent by municipalities to MPERS are insufficient and thus require MPERS to request additional records, waiting until the deadline in the resolution to provide any records is not a good strategy for any municipality seeking to take advantage of the settlement terms which enable both MPERS and the municipalities to avoid the cost of litigation.

Absolutely, MPERS is essentially legally obligated to do so. MPERS has already sued Stonewall, Richwood (settled), Killian, Cotton Valley (settled), New Orleans, Moreauville, Cottonport, Baskin (settled), Simmesport, Elton, Greensburg, Ferriday (twice), Dodson (settled), Springfield, Cheneyville, Glenmora, Roseland, Forest Hill, Zwolle, Grayson, Melville, Grand Couteau, Varnado, Gibsland, Henderson, and Lecompte. MPERS is mandated to hold accountable municipalities and public officials who don't honor the benefits that its municipal police officers are promised under Louisiana and federal law (which include disability and survivor benefits, not just retirement benefits).

Fortunately, other municipalities (including but not limited to Port Barre) had the good sense to settle before being sued. Those municipalities may have settled under more favorable terms than the resolution's. However, after years of certain municipalities' noncompliance, the resolution's terms are now the best that MPERS can offer.

Notably, MPERS has had to make public records requests of many of these and other municipalities to determine which officers (if any) need to be enrolled and what amounts the municipalities owe under state law. Of course, these municipalities were required under Title 11 to report the requested information to MPERS monthly, regardless of any public records request, but failed to do so.

Sadly, some municipalities violated state law yet again by failing to respond (or responding only after several months) to MPERS' requests. In fact, some of those same municipalities (namely, Cheneyville, Grand Isle, Lecompte, and Springfield) subsequently made (mostly pointless) public records requests of MPERS, all while failing to provide or fully provide responsive records to the public records requests that MPERS made of them to try to enforce their compliance with the retirement laws.

Unfortunately, not only are they hurting their own police officers and their families (there is almost certainly at least one deceased officer of some delinquent municipality who was never enrolled in MPERS and subsequently killed in the line of duty and whose spouse or children are not receiving benefits because of it), they are also increasing the employer contribution rates for all participating municipalities and shortchanging the amount of MPERS' retirees potential cost-of-living adjustments.

Yes, you need to act very quickly. No, MPERS will absolutely NOT extend deadlines any further. Please send us sufficient records and enroll all of your eligible officers well before the deadlines described above.

We do not care if your insurance company's lawyers are waiting on writs or appeals because they said they can get you "hometown cooking." An amended resolution settlement is not a right. In our opinion, it's just an intelligent option.

These FAQs will be unpublished after 12/31/23, because all municipalities eligible for an amended resolution will be determined shortly thereafter. Any delinquent municipality who misses deadlines will be sued unless it negotiates an individual settlement with MPERS, which will it cost more than an amended resolution settlement.

Absolutely not. We look forward to receiving those funds and will use them to provide benefits to police officers and their beneficiaries.