An Employer's Road Map to Changing LAGERS Benefits

Road, Mountain, Path, Direction


It’s that time of year.  The air is crisp, leaves are changing color, the Cardinals and the Royals advanced to the playoffs, football has begun, and, the most exciting of all, it’s budget time!

This is the time of year when my phone calls and e-mails pick up as employers consider changing benefit levels for the upcoming fiscal year.  I thought this post would be a great opportunity to address some of the most common questions I receive from employers during these autumn months.

What is the process for changing LAGERS benefits?

  1. Request a supplemental valuation (cost study) from LAGERS’ actuary. This will tell you how the benefit change will affect your employer’s cost for retirement benefits. Each employer may receive one free supplemental valuation each year but may request more, for a fee.
  2. Make the valuation available for public inspection for 45 calendar days.
  3. The board of the local employer may adopt a resolution to formally install the benefit change after the 45 day public information period has expired.

How do we satisfy the 45 day public information period?

Many political subdivisions choose to include discussion of the valuation in official board minutes to start the 45 day clock.

When will the change take effect?

The board will set an effective date when it adopts the resolution.  The effective date can be the first of any future month the board chooses.  It does not have to match up with the employer’s fiscal year, LAGERS’ fiscal year, or calendar year.

Did you say the Royals made the playoffs?

This is hard for me to believe as well.  I was four years old the last time the Royals were playing baseball this late in the year.

Will former employees and retirees be affected by a benefit change?

No.  Only current employees’ benefits will be affected.

When is the earliest an employee can retire and be eligible for the newly elected benefits?

An employee may have a retirement effective date the same day as the effective date of the benefit change and be affected by the benefit change, so long as the employee receives credited service for the month immediately preceding the effective date of the benefit change.

How often can an employer change benefits?

An employer may make a benefit change once every two years.  This applies to each benefit category.  For example, if an employer changes to the L-3 benefit program in 2014, it cannot adopt a new benefit program until 2016.  However, it could elect the Rule of 80, for example, in 2015.

Can we make multiple changes at the same time?

Yes.  For example, many employers have recently made upgrades in the benefit program to increase benefits for future retirees while at the same time switching to employee contributory to offset some of the cost.

Can we change to any level we want or do we have to move one level at a time?

An employer may elect to move to any level.

Can we choose to apply the benefit change to new hires only or future service only?

Upgrades are retro-active and will be applied to all credited service the current employees have earned with that employer.  Downgrades will be applied to all current employees as well, but only to the future service the employees earn.  Removing the Rule of 80 applies to new hires only.


Have any questions not on this list? Let me know, I can help!


Jeff Kempker, RPA, CRC Jeff Kempker
Manager of Member Services


Tagged Benefit Change, Cost, Downgrade, employer, Employers, Members, Upgrade

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