Controversial PERS bill dies on calendar but cities and counties still have concerns

Published: Feb. 9, 2023 at 8:28 PM CST
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JACKSON, Miss. (WLBT) - We’re following up on a story we first reported Monday about a bill that could change the structure of the state’s retirement system decision-making.

Lawmakers tell us many of you have contacted them by phone and email. And that apparently moved the needle on this issue.

”The walls and the halls of the Capitol, they talk and when you start hearing talks about retiree systems, about what’s going to happen and what’s not going to happen, you need to pay attention,” said Rep. Tom Miles.

And retirees were paying attention, as were cities and counties who’ve raised their hands to say the decision to raise PERS employer contributions will impact also them.

So, the controversial House Bill 605?

“The bill will die on the calendar today,” noted Rep. Charles Busby. Busby says they worked out a solution.

“The PERS board agreed to push the date by which the employers contribution would be increased out to July 1, 2024, and to work with us in the interim to find a better solution,” he described.

The retirees’ concern and reason for calls to the Capitol had been about preventing interference by lawmakers.

“We, as elected officials, should not stand in the way of letting the PERS board do their job,” noted Rep. Miles.

But it turns out there was another side to the argument from local leaders. Hattiesburg Mayor Toby Barker broke down their concerns.

“Based on what the PERS board decided to do in December, which was increase the employer contribution from 17.4 to 22.4., that’s an over 28% increase in our retirement cost for the city of Hattiesburg, that was 1.5 million,” Barker said. “And so, you know, where does that money come from?”

Barker says it’s still an unfunded mandate on local governments and school districts that will impact more than just state employees and retirees. And they’ll have to budget in the fall with the knowledge that the issue is unresolved.

“All you’re doing is shifting the burden from the state to down to the local property owners, because that’s what will happen,” noted Barker. “If these employer contribution rates are allowed to go into effect as they are, I mean, cities and school districts and counties are going to have to raise property taxes, and they’re going to have to cut services and employees.”

The actuary had recommended an effective date for the contribution increase of July 1, 2024. That was in the official reports based on the Board’s current funding policy.

But the motion passed by the Board included an effective date of October 1, 2023.

PERS tells us that October was chosen at the time to “provide funding to the system sooner, considering investment experience and the prospect of more economic volatility, while still providing time for implementation at the state and local level.”

We also received a statement from the PERS executive director.

“I plan to recommend to the PERS Board that the effective date of the previously approved employer contribution rate increase be moved from October 1, 2023, to July 1, 2024. This change will provide more time for planning while remaining consistent with actuarial recommendations and acting in the best interest of the membership to ensure the plan is properly funded long term.”

PERS Executive Director Ray Higgins

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