Surge in market helps state retirement system

By Bobby Harrison/NEMS Daily Journal Jackson Bureau

JACKSON – If investment earnings continue to skyrocket, the taxpayer share of funding for the Public Employees Retirement System might not have to be increased again in the coming year.
The share paid by the government – through taxpayers – to fund the state retirement system is scheduled to rise from 12 percent of the salary of each public employee to 12.93 percent on Jan 1.
But that might be the last increase for at least a short while, Pat Robertson, the executive director of PERS, said Monday during a speech to the Mississippi State Stennis Institute of Government/capitol press corps.
Unless something unforeseen happens, Robertson said, the state will earn more than 20 percent on its investments for the current fiscal year, which ends June 30, on top of earnings of more than 14 percent for the last fiscal year.
Robertson, making no promises, said the earnings for the current year could decrease the need for another increase in the employer contribution.
With the budget struggles of recent years, the PERS Board, the Legislature and Gov. Haley Barbour have struggled with how to fund the system, which includes about 167,000 state, city and county 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 employee share from 7.25 percent of pay to 9 percent instead of increasing the taxpayer share.
Despite the double-digit increase in investment earnings caused by the recent surge in the stock market, the system is still underfunded, thanks in large part to the dramatic drop in the market earlier this decade.
On top of the spotty performance of PERS earnings in recent years, the benefits for public employees were enhanced by the Legislature in 1999 without paying for the additional benefits. That has produced another long-term burden on the system, Robertson sad.
“PERS is not as well funded as it should be,” she conceded. Still, she said the system is on the right path.

Contact Bobby Harrison at (601) 353-3119 or bobby.harrison@journalinc.com.