Jindal’s battles shift to retirement

With one battle largely behind him and fuming teachers and union leaders considering court challenges, Gov. Bobby Jindal now shifts his focus to a different group of angry people: state employees.

The Republican governor’s attention centered on an education overhaul that will substantially change the face of public education. The centerpiece bills received final passage last week.

While relishing the victory, the Jindal administration signaled a swing to proposals to revamp retirement programs for thousands of rank-and-file state workers and public college employees who stand to lose money and retirement benefits if Jindal’s plan is enacted.

The workers are fighting to kill the bills in the Legislature.

Behind the scenes, lawmakers in the Republican-dominated Legislature have shown resistance to Jindal’s proposals, suggesting they can’t pass in their current form and questioning whether they can win legislative backing at all.

“I still think there’s still the energy there to do something with pensions. Whether we do what was proposed at the beginning of session is another question,” said House Speaker Chuck Kleckley, R-Lake Charles, a Jindal ally who acknowledges lawmakers have heartburn over the issue.

Neither retirement committee in the House or Senate has scheduled hearings on the measures. The House took the lead on the controversial Jindal education measures, so the Senate is being asked to start the retirement proposals.

The governor wants to increase the contribution rate charged to state workers and higher education employees for their retirement from 8 percent to 11 percent of their pay.

He also wants to push back the retirement age to 67 for a person to receive full benefits, to calculate the monthly retirement payment on an employee’s last five years of salary instead of the current three years and to create a cheaper type of pension plan for new employees.

The proposals wouldn’t apply to public school teachers and law enforcement workers. And if state workers weren’t angry enough, Jindal managed to dredge up more fury by not initially including himself in the 3 percentage point increase that boosts employee costs for their retirement benefits.

Jindal spokesman Kyle Plotkin said the governor will ask lawmakers to change the measure to include him in its provisions. “The governor thinks it’s the right thing to do,” Plotkin said.

Jindal said the retirement changes would help cut the costs of retirement programs that are more than $18 billion short of what they need to pay all benefits to participants. He said the lower costs would safeguard state services and ensure the state can provide pensions to its workers.

“The growth of state pension costs is crowding out critical investments in priority areas,” Plotkin said in a recent statement.

Opponents call the proposals illegal, by breaking contracts made with employees when they were hired. And they note that the money drummed up by increased costs on workers is slated to lower state agency costs in Jindal’s budget proposal, rather than pay down the retirement debt.

A recent analysis by a law firm hired by the Louisiana Legislative Auditor’s office, whose employees would be subject to the Jindal-backed changes, said the key proposals sought by the governor are likely to be ruled unconstitutional.

The lawyers said that if the bills were passed and then challenged, a judge probably would reject them because they change benefits in employees’ existing contracts with state agencies and diminish accrued retirement benefits.

The Jindal administration said the analysis was riddled with errors. Kleckley agreed.

“We’re still looking at it, but we think there are a lot of holes in it,” the House speaker said.

Whether lawmakers pass or reject Jindal’s pension proposals, however, the push has created woes for them. Next year’s budget is tied to the fate of the retirement bills, and legislators’ own staff would be impacted by the changes.

In some ways, this next battle that Jindal has picked could be more riddled with angst toward the governor than the education bills.

EDITOR’S NOTE: Melinda Deslatte covers state politics for The Associated Press.