“This is the elephant in the room,” Collins said. “We have to do the hard things ... We have to find ways to make the program sustainable for the 20- and 30-year-olds who are out there now.”
In recent years, various groups have expressed concerns about PERS, which covers employees in state and local government, local school districts, community colleges and universities.
The system has 58 percent of the funds needed to cover its liabilities over a 30-year period. The desired industry average is 80 percent.
But Pat Robertson, PERS executive director, has said the program is solvent and steps have been taken to ensure its continued sustainability.
The PERS Board recently increased the amount paid by state and local governments from 12.83 percent to 15.75 percent of an employee’s salary starting July 1.
Collins said taxpayers cannot continue to sustain such increases. The increase will cost the state an estimated $44 million per year and will be passed on to local governments to cover their employees in the system.
Collins’ bill, still being developed, would freeze the cost of living increases for three years.
Currently, retirees receive a 3 percent cost of living increase each year. Many people take their cost of living adjustments in what is known as a 13th check. Collins said for some the 13th check is more than $50,000.
A 2011 PERS study found the average annual retirement benefit is just more than $19,000, including the yearly cost of living adjustment.
Collins’ plan also would give the governor and lieutenant governor three additional members to the board that oversees PERS. Currently, the governor has one appointee.
Most PERS Board members are people in the retirement system elected by fellow members.
She said a study commission formed by former Gov. Haley Barbour recommended the board be revamped to include more financial and investment experts.
Collins’ proposal would halt the cost of living adjustment any year that its funding dropped below a certain level.
It would also eliminate the enhanced retirement plan for legislators elected after Jan. 1, 2011. The system is separate from PERS and funded solely by legislators.
“We need to lead by example,” she said.
Sen. J.P Wilemon, D-Belmont, said he considered filing legislation to make changes for new hires, but opted not to because of fear of how that proposal might be changed in the legislative process.
“I would not vote for anything that changes the benefits for current employees,” he said.
Collins said she hopes her legislation will help jump-start talk of how to make changes she said are needed.
“I think the ball is in our court,” she said. “We should not be afraid to talk about it.”