Optional Retirement Plan (ORP)

The Optional Retirement Plan (ORP) has been available since 1990, and is an alternative retirement plan provided by a private carrier for academic and unclassified employees of Louisiana colleges, universities, and community colleges. The ORP is also available to employees of the following boards:
  • Board of Regents
  • Board of Supervisors for the University of Louisiana System
  • Board of Supervisors of Louisiana State University and Agricultural and Mechanical College
  • Board of Supervisors of Southern University and Agricultural and Mechanical College
  • Board of Supervisors of Community and Technical Colleges
  • Any other constitutionally established board that manages institutions of higher education
The companies below are the current ORP providers. Contracts with these providers expire June 30, 2020.
How ORP works

An ORP account is owned by the employee, and there is no waiting period to join. The employee’s contribution is 8.0% of salary, less a 0.05% administrative fee to TRSL. The employer contribution, that will be transferred to individual ORP employee accounts, is determined by employer type.
 
Higher education employers: The minimum contribution rate is 6.2%. However, higher education boards created by Article VIII of the Louisiana Constitution can establish the employer contribution rate above 6.2% by board resolution. Any rate established by board resolution is applicable to each board’s employees and the employees of each institution and agency under its supervision and control, including laboratory schools. Resolutions establishing the employer contribution rate in excess of 6.2% must be received by TRSL by June 1 prior to the fiscal year for which the rate is being set.

Non-higher education employers: The employer contribution rate must be the greater of the employer normal cost contribution for the TRSL Regular Plan, or 6.2%.
 
What is the normal cost? Normal cost is the cost of funding the benefits for active members in the TRSL Regular Plan (a defined benefit plan) earned that year. The normal cost is calculated by accounting for the TRSL Regular Plan’s historical experiences and its assumptions about future events, such as investment returns, mortality and disability rates, salary increases, and termination and retirement rates. Employer normal cost rates can be found in TRSL's contribution rates webpage.

Employee and employer contributions are pooled and invested by the designated ORP carrier in the options chosen by the employee. The performance of the employee's investments determines the retirement benefit due. Projections of possible benefits are provided, but not guaranteed, by the ORP carriers.

ORP balances can be rolled over to another IRS-qualified retirement plan or to an IRA(s) at any time after termination of employment. Also, a one-time, lump-sum payment of up to 36 months of your annuity is available from the ORP account at the time of retirement in addition to a lifetime annuity. If the up-front lump sum is chosen, lifetime benefits would be reduced accordingly.
TRSL or ORP: Which one?

The decision to join the ORP is irrevocable. You cannot change your mind and later join TRSL. If you change to another employer that reports to TRSL, you must stay in the ORP. You should look at your career expectations carefully and realistically before deciding whether to enroll in TRSL or the ORP.
 
If you are reasonably sure you won’t continue in your current position, or don’t plan to remain in Louisiana for at least five years, the ORP may be a good idea because it would be portable to most other U.S. colleges and universities. However, if you plan to continue teaching or working in Louisiana, TRSL is probably the best choice. Ultimately, however, each person has unique circumstances, and the decision to join ORP or TRSL belongs entirely to that individual.

If you decide to enroll in the ORP, you will need to complete TRSL’s Application for Optional Retirement Plan or Change of Carrier (Form 16).
Need more information?

  Optional Retirement Plan (ORP)
  ORP Comparison Calculator
  ORP Contribution Rates
 
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