The Public Employees’ Retirement System of Mississippi on Sunday announced its opposition to a bill in the state legislature that would eliminate an employer-contribution increase the board had approved and would also drastically change the make-up of the PERS Board of Trustees.
Currently, eight of PERS’ 10 board members are elected by members of the pension fund, joining the state treasurer and one PERS member appointed by the governor. The proposed legislation would reduce the number of elected officials to two out of 11.
House Bill 1590, passed by the Mississippi House of Representatives on March 13, would increase the total number of board seats to 11. The number of board members directly appointed by the governor would increase to four from one, and the number of members appointed by the lieutenant governor would increase to three from zero. No qualifications are laid out in the bill for those seven appointments, in contrast to very specific qualifications laid out in the bill’s original text and for other appointments. In addition to the state treasurer, the 11th member would be the Mississippi Commissioner of Revenue, also appointed by the governor.
The bill moved to the Mississippi Senate for consideration and was referred on March 14 to the state Senate’s Government Structure Committee, which was created in January and is in its first session. The state legislative session runs through early May.
The current governor of Mississippi is Tate Reeves, a Republican, who began serving in 2020 and was re-elected to a second term in November 2023.
In a press release, PERS called the bill an attempt to politicize the PERS system.
“This change would indirectly shift more power to politicians, in effect turning control over to the governor and lieutenant governor, especially since all appointments would be with advice and consent of the Senate,” the release stated.
According to PERS, replacing the board with government appointees would result in a loss of institutional knowledge and continuity.
Additionally, House Bill 1590 would undo the board’s plans to increase the pension employer contribution rate to 22.4% from 17.4%. “By rejecting the Board’s proposed rate increase, this approach not only would jeopardize the membership, it would also hurt all taxpayers,” the PERS release stated in response to the measure. “The longer the plan goes without proper funding, the more it costs and the harder it gets, leaving future citizens with the liability.”
The pension system had a funded status of 56.1%, as of June 30, 2023. The fund has one-, three-, five- and 10-year annualized returns of 7.76%, 9.36%, 7.63% and 8.47%, respectively.
PERS managed about $31.6 billion in assets, as of June 30, 2023. According to the release, 10% of Mississippi’s population are members or beneficiaries of PERS, representing 300,000 members.
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Tags: Legislation, Mississippi, Mississippi PERS, Pensions, Public Employees’ Retirement System of Mississippi