Thursday, March 7, 2013

Jackson Municipal Retirement System funding falls below 50%

PERS issued an annual report stating Jackson's municipal retirement system is less than 50% funded. The unfunded liability is $63.5 million dollars. The unfunded liability increased $2.3 million from the 2012 report and $3.5 million since 2011. The retirement account covers police and firefighters hired by the city prior to April 1, 1976. The funding level is currently 48.8%.

Retirement systems for policeman and firemen were managed by municipalities for decades. Enrollment in these retirement accounts ended in the late 1970's as new employees were enrolled in PERS. The municipalities were given the option of converting these accounts to the PERS system in the 1980s but nearly 20 chose not to do so. The municipalities, not PERS, are responsible for funding these accounts although they are managed by PERS. 2011 post, 2012 post The payments will decrease each year as enrollment was closed and beneficiaries die. The chart on page 58 in the report posted below provides a graph showing the plan will "wind down" in 2030's until it reaches zero.

Click on chart to expand

The report states there is only one current city employee enrolled in the system and 640 beneficiaries- 439 retired employees and 191 surviving family members. 10 are on disability. The annual benefit to a retiree is $22,328 and $14,662 to a survivor. The total payment in fiscal year 2011 to beneficiaries was $12,910,994. The average age is 72 years old. A member is paid 50% of his average compensation and an additional 1.7% of average compensation for each year of service over twenty years (the maximum level is 66%.). There are 14 fewer beneficiaries than last year but the liability still increased.

The total liability for Jackson is $124,017,685 but the plan has $60,511,241 in assets. The plan assumes a rate of return of 8.0%. The system is earned the same rate of return as PERS: 0.6% in 2012. The plan was funded on September 30, 2012 at a level of 48.8%.


Jackson faced a similar problem in the mid 1990s. Jackson's plan was below a funding level of 50% from 1991 (38%) to 1996 (46%). The unfunded actuarial liability was $73,861,000 in 1996 and after reaching $80,568,000 in 1994. Jackson issued $50 million in retirement bonds (actually $49.8 million) that were paid off in 2009. The interest cost was $23 million of the bonds. The average interest rate paid on the bonds was 6.3% (not a weighted average) and the average annual principal payment was $4.1 million. The proceeds gained from the sale of the bonds paid the unfunded liability down to $15.8 million in 1997 and improved the funding level to 88%. The plan had a surplus of $6.2 million in 2002 and was funded at 104%. Unfortunately, the funding level has declined since 2004:

1998: 90%
1999: 98%
2000: 102%
2001: 104%
2002: 94%
2003: 88%
2004: 83%
2005: 76%
2006: 73%
2007: 72%
2008: 70%
2009: 59%
2010: 54%
2011: 52%
2012: 49%

Jackson dedicates 5.00 mills (slightly over $1 million per mill) to funding the plan. The funds generated by the property taxes were used to retire the bonds. Thus Jackson only contributed $280,482, 7.9% of the PERS-required contribution of $3,563,516. However, Jackson paid more than the required amount in 2010: $5,735,113 while PERS required $5,005,779 - a payment of 114%. Jackson is scheduled to end contributions in 2020 as it projects the system to be fully funded as it winds down to zero beneficiaries.

 

6 comments:

Anonymous said...

Jackson is a massive debt bomb.

Anonymous said...

For those who haven't heard Marshand Crisler has been nominated for induction into the 'Egg-Sucking Dog' Perennial Candidate Hall-of-Fame.

Congrats Marshand. You've earned it!

KaptKangaroo said...

I hear a tree, it is falling, somewhere, I think, in the woods.

Shadowfax said...

I'll have to be honest and plead ignorance to the fact that PERS rates municipalities independent of each other and segregates those ratings from the system as a whole. If that's the case, how can ANY small municipality be acceptably funded?

Shadowfax said...

To clarify my non-understanding; I did not know a municipality could opt out of the larger pie and choose a mini-pie of its own. It's too late now to claim they want to be melted into the bigger pie. Is there a list somewhere of all the municipalities who selected this option? Most of them are going to be S.O.L.

Kingfish said...

Report is now included in the post. Clinton funds its plan pretty well.

Who is the hottest reporter?

Suscribe to latest on JJ.

Recent Comments

Search Jackson Jambalaya

Loading...

Subscribe to JJ's Youtube channel

Archives

Who is the Hottest Reporter in Jackson?

Trollfest '09

Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).


Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.

Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".

In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.


In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.

Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.

Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!

This is definitely a Beaver production.


Note: Security provided by INS.

Trollfest '07

Jackson Jambalaya is the home of Trollfest '07. Catch this great event which promises to leave NE Jackson & Fondren in flames. Sonjay Poontang and his band headline the night with a special steel cage, no time limit "loser must leave town" bout between Alan Lange and "Big Cat"Donna Ladd following afterwards. Kamikaze will perform his new song F*** Bush, he's still a _____. Did I mention there was no referee? Dr. Heddy Matthias and Lori Gregory will face off in the undercard dueling with dangling participles and other um, devices. Robbie Bell will perform Her two latest songs: My Best Friends are in the Media and Mama's, Don't Let Your Babies Grow up to be George Bell. Sid Salter of The Clarion-Ledger will host "Pin the Tail on the Trial Lawyer", sponsored by State Farm.

There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

Note: Security provided by INS
.