A.(1) There is hereby established a funding deposit account, hereafter in this Section referred to as the “account”. The account shall be credited and charged solely as provided in this Section.

            (2) The balance in the account shall be set equal to zero as of July 1, 2023.

            (3) The funds in the account shall earn interest annually at the board-approved valuation interest rate, and the interest shall be credited to the account once per year.

            B.(1) Notwithstanding any provision of La. Rev. Stat. 11:103 or 104, for fiscal years beginning on or after July 1, 2023, the board of trustees may require a net direct contribution rate of up to the following applicable limit:

            (a)(i) For a year in which the employer contribution rate determined under La. Rev. Stat. 11:103 is equal to or greater than the rate determined under La. Rev. Stat. 11:103 for the previous year, the rate determined under La. Rev. Stat. 11:103 plus eighty-five hundredths of one percentage point.

            (ii) For a year in which the employer contribution rate determined under La. Rev. Stat. 11:103 is lower than the rate determined under La. Rev. Stat. 11:103 for the previous year, the rate determined under La. Rev. Stat. 11:103 plus eighty-five hundredths of one percentage point plus one-half of the difference between the rates determined for the two years.

            (b) Notwithstanding Subparagraph (a) of this Paragraph, for the 2023-2024 Fiscal Year:

            (i) If the employer contribution rate determined under La. Rev. Stat. 11:103 is equal to or greater than the rate under La. Rev. Stat. 11:103 for the previous year, the rate determined under La. Rev. Stat. 11:103 plus forty-two and one-half hundredths of one percentage point.

            (ii) If the employer contribution rate determined under La. Rev. Stat. 11:103 is lower than the rate determined under La. Rev. Stat. 11:103 for the previous year, the rate determined under La. Rev. Stat. 11:103 plus forty-two and one-half hundredths of one percentage point plus one-half of the difference between the rates determined for the two years.

            (2) For any fiscal year in which the board of trustees sets the direct employer contribution rate higher than the rate determined under La. Rev. Stat. 11:103, excess contributions resulting from the higher rate shall be used as provided in Paragraph (C)(1) of this Section or transferred to the account as provided in Paragraph (C)(2) of this Section.

            C.(1) Except as provided in Paragraph (2) of this Subsection, any excess contributions resulting from the board’s exercise of its authority pursuant to Paragraph (B)(1) of this Section shall be applied, until exhausted, exclusively to reduce the outstanding balance of the oldest positive amortization base; however, the future payments for such amortization base shall continue to be made according to the original amortization schedule established in compliance with the requirements of Article X, Section 29(E)(3) of the Constitution of Louisiana and La. Rev. Stat. 11:103 until the outstanding balance is fully liquidated.

            (2) The board of trustees may dedicate a specific amount of excess contributions, up to the amount generated by setting the rate equal to eighty-five hundredths of one percentage point more than the rate determined under La. Rev. Stat. 11:103, to be used solely to pay additional benefits to retirees, survivors, and beneficiaries. The dedicated amount of funds shall be credited to the account.

            D. Beginning with the June 30, 2024, valuation, the board of trustees may, in any fiscal year, direct that the account be charged to provide additional benefits to retirees, survivors, and beneficiaries as provided in Subsection F of this Section.

            E. The monies in the account shall not be considered system assets for purposes of calculating employer contributions.

            F.(1) Funding for additional benefits for retirees, survivors, and beneficiaries shall be provided only from the funding deposit account and only when sufficient funds are available as determined by the actuary. The additional benefits shall be payable only as determined by the board of trustees, and the board shall determine the following:

            (a) Whether the additional benefit will be a nonrecurring lump-sum payment or a permanent benefit increase. Any additional benefit paid under the provisions of this Subsection shall be in the form of a nonrecurring lump sum no more frequently than once in a three-year period.

            (b) Whether the additional benefit will be calculated based upon the original or current benefit.

            (c) Whether a minimum age will be required to receive an additional benefit.

            (d) Whether a minimum period since benefit commencement longer than the period required in Subparagraph (2)(b) of this Subsection will be required to receive an additional benefit.

            (2)(a) The amount of any permanent benefit increase shall not exceed three percent of the benefit to be used in the calculation in accordance with Subparagraph (1)(b) of this Subsection.

            (b) No additional benefit shall be payable until at least one year has elapsed since benefit commencement.

            (3) Approval of additional benefits for retirees, survivors, and beneficiaries as provided in this Subsection shall be made by formal action of the board of trustees and shall be considered amendments to the plan provisions of the retirement system.

            Acts 2022, No. 360, §1, eff. June 30, 2022; Acts 2023, No. 108, §1, eff. July 1, 2023.