By Bobby Harrison/NEMS Daily Journal
JACKSON – Gov. Haley Barbour has formed a commission to study the solvency of the state’s retirement system, which has been financially strained in recent years by a volatile stock market and by enhanced benefits for its members.
The Public Employees Retirement System Study Commission is supposed to make recommendations to the governor and the Legislature by Nov. 15.
“The current funding path for Mississippi’s pension system relies too heavily on increased contributions from taxpayers,” Barbour said in a news release. “Large benefit increases adopted in the 1990s and early 2000s, coupled with the impact of the economic downturn, have created a financially unsustainable system. The Commission will take a hard look at the tough decisions that need to be implemented to ensure the long-term solvency of the system.”
In recent years, the PERS Board, the Legislature and Barbour have struggled with how to fund the system, which includes about 167,000 state, city and county employees, including school district personnel. As legislators and Barbour have dealt with declining state revenue and budget shortfalls, they have struggled with providing the additional funds required by the system to ensure it met federal guidelines and was able to meet its long-term obligations to the state’s public employees.
The governor has been particularly vocal in opposing increases in the taxpayer share of funding the system.
In 2010, the Legislature, on the recommendation of Barbour, opted to increase the employees share from 7 and one-fourth percent of their paycheck to 9 percent instead of increasing the taxpayer share.
This past session, legislative leaders convinced the PERS Board to delay until January a planned .93 percent increase to 12.93 percent in the employer (or taxpayer share.) And in May, Pat Robertson, PERS executive director, said in a speech that the need for future increases might be mitigated because of improved earnings on PERS’ investments.
It is not known yet whether recent stock market declines would dampen that outlook.