This is a sponsored post by Bigger Pie Forum.
Imagine being able to vote yourself better retirement benefits while you’re a beneficiary of a retirement plan.
That’s the scenario in Mississippi if the Public Employees’ Retirement System of Mississippi follows an opinion from the office of Attorney General Jim Hood and changes its present regulation. This would allow legislators and other statewide officials who are also PERS retirees to keep collecting their benefits while in office.
Under PERS regulations, any retiree who either goes back to work for an agency or as an elected state official (city and county officials are exempt from this requirement) has to cease collecting benefits and instead become a contributing member of the defined benefit pension system.
The justification for this regulation is the PERS Board considers the Legislature (and other state elected positions) to be full-time jobs. Any retiree who’s elected to the Legislature will also have the benefit of the SLRP (Supplemental Legislative Retirement Program) in addition to their PERS pension when they leave office.
Right now, the Republican-dominated Legislature has done nothing to reform PERS. The pension system is in the middle of a cash flow flip-flop as the number of the contributing employees shrink while the number joining the retiree rolls continues to increase. This demographic boomerang threatens PERS financial stability.
The number of employees paying into the plan shrunk from 152,382 in 2017 to 150,687 in 2018, while the number of retirees increased from 102,260 to 104,973.
The plan’s funding ratio — which is the share of future obligations covered by current assets and provides a good snapshot of a plan’s financial health — is at 62.5 percent after being 87.5 percent fully funded as recently as fiscal 2001.
Despite increased investment returns in the past two years, the PERS Board has already asked the Legislature to pass the hat to taxpayers in the form of increased employer contributions (15.75 percent to 17.4 percent) that will cost the state general fund $75 million or more per year and local governments $25 million or more. The reality is the taxpayers will need a bigger hat to collect all the money PERS will need in years to come.
Adding enough retirees who are actively collecting their retirement benefits to the Legislature would give them a chance to feather their own nests at the expense of future beneficiaries. Already, there is a lack of representation by non-PERS member taxpayers on the PERS Board of Trustees.
Having retirees collecting PERS benefits while being in a position to appropriate funds and write new laws governing the pension system is like putting the fox in charge of the hen house.
PERS needs vital structural reforms to ensure it can pay out benefits to retirees (such as freezing or modifying the plan’s overly-generous cost of living adjustment) while having something to pay present workers when they retire.
Having a large number of retirees collecting benefits in the Legislature while overseeing the plan will ensure these needed reforms never take shape. This development could also lead to further ruinous changes with the pension fund that could jeopardize its financial standing and lead to a costly taxpayer bailout.
18 comments:
Slurp it up, legislators.
There are a few common-sense changes/corrections that should be made to PERS. None of these decisions should be in the hands of legislators -- who make their decisions based on how it will impact their chances for re-election.
Oh, the hypocrisy coming from Bigger Pie with his history after IHL!
"Imagine being able to vote yourself better retirement benefits while you’re a beneficiary of a retirement plan." Like the current legislators?!!
Anyone who thinks Hood just came up with this opinion out of thin air, going into the 2019 election season with his run for the Governorship, is smoking dope.
This move by Hood, as idiotic as it is, has been hailed by the state's largest lobby of state employees - the Mississippi Association of Educators. They have been spreading the news of Hood's ruling to all that will listen in an effort to elect more teachers to the legislature.
Then there will be a double ability to double dip. Not only the effect on PERS, where they will be voting to feather their own retirement nest, but also their voting for any and every additional penny to go into "education".
Thanks, AG Hood, for figuring out this newest way that Democrats have found to buy themselves votes with other people's tax dollars.
Like pigs in slop.
Do you reckon if there were PERS beneficiaries in the legislature back in the day, they would have said hell no to SLRP? If legislators participate in PERS I see no reason why beneficiaries can't serve in the legislature.
If the legislature opts out of all PERs benefits, then yes I can see telling current beneficiaries that they can't serve. Good luck with that.
Oh, to work for a think tank.
4:28 - the legislature's ability to participate was based on a ruling that their position as a legislator was full-time, thus they were an employee. The SLURP was their payoff when all other PERS retirees got their 3% COMPOUNDED annual COLA. All part of the Ronnie Musgrove, Tim Ford giveaways trying to ensure their political future.
Hard to defend SLURP, but its also hard to defend the COLA being paid much more than the Actual Cost of Living and it being compounded, resulting in the enormous 13th checks.
But this new ruling of Hood's that retirees can go back to work for the state and still claim to be retired from the state. At least the legislators are still working as they gain the benefit (but don't get paid) their SLURP dollars. Hood lets the teachers get paid as an employee, and get paid as a retiree. Only in a Democrat's mind can that make sense.
Seems that Hood's ruling should trickle down to all retirees of the state.....they should be able to hold new roles with the state without forfeiting PERS benefits. What is the difference?
Bigger Pie folks got theirs. Screw the rest of you all. Nothing like inherited wealth.
The solution is to take SLRP away from the legislators. Of course, that will never happen because they have a conflict of interest and will never do anything to remedy the unfair advantage that they enjoy while slurping on taxpayer money for their retirement. If the Little Emperor wants to cut waste, he should step his short ass up and do it with SLRP.
Always enjoy watching the right wing nuts debate the left wing nuts and make the usual silly arguments on this site.
The only thing more clandestine than being able to plot and plan your own retirement benefits...is...get a ruling on it from someone who also participates in the same plan and stands to gain from several fronts with his ruling (not the least of which is votes).
Slurp is also the trade off - a bad one - for the lack of a Legislative pay raise since 1980.
Bigger Pie conveniently fails to mention that legislators are prohibited from voting on any measure that provides direct financial benefit to the legislator.
“Imagine being able to vote for lower taxes while yourself paying less in taxes as a result.”
Oh wait, that’s not imaginary. Or scandalous.
From 5:17 -
"But this new ruling of Hood's that retirees can go back to work for the state and still claim to be retired from the state."
Well, no. The current (pre-opinion) system allows PERS recipients to return to a part time position at a PERS-covered agency while still collecting retirement benefits from their previous full time employment. But there are explicit restrictions on the part time hours and pay, and they do not also accrue additional PERS time while doing part time work. The new opinion basically just says legislators are part time employees and the same rules apply to part time legislators that apply to part time employees of other agencies.
From 5:25 -
"Seems that Hood's ruling should trickle down to all retirees of the state.....they should be able to hold new roles with the state without forfeiting PERS benefits. What is the difference?"
No difference - see above. Other state part time positions already have this scenario. Hood's opinion simply recognizes that legislators are part time employees and can receive the same PERS benefits as other part time state employees who are PERS recipients.
As far as legislators being able to vote for their own benefits, this is hardly a new or unique situation.
10:47 - You made that up.
'The new opinion basically just says legislators are part time employees and the same rules apply to part time legislators that apply to part time employees of other agencies'. It doesn't say that at all. That's simply your 'take away'.
This legislation in no way defined the status of legislative jobs as full or part time, nor was that addressed. It's nothing more than a special exception carved out for members of the legislature. The reasons for that are anybody's guess.
Nor is you final comment accurate. Legislators voting on their own retirement benefits is indeed unique. If you think not, let us know of other situations where that's practiced.
Meanwhile, no other state retiree can, for example, re-enter the system as a teacher and continue drawing benefits. And we certainly need teachers more than we need legislators.
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