Bill Text: MS HB1590 | 2024 | Regular Session | Engrossed
Bill Title: PERS; reconstitute membership of board and rescind scheduled employer's contribution increase.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2024-04-02 - Died In Committee [HB1590 Detail]
Download: Mississippi-2024-HB1590-Engrossed.html
MISSISSIPPI LEGISLATURE
2024 Regular Session
To: State Affairs
By: Representative Zuber (By Request)
House Bill 1590
(As Passed the House)
AN ACT TO AMEND SECTION 25-11-15, MISSISSIPPI CODE OF 1972, TO RECONSTITUTE THE BOARD OF TRUSTEES OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM; TO PROVIDE THAT THE BOARD SHALL CONSIST OF THE STATE TREASURER, THE COMMISSIONER OF REVENUE, FOUR APPOINTEES OF THE GOVERNOR, THREE APPOINTEES OF THE LIEUTENANT GOVERNOR, ONE RETIRED MEMBER RECEIVING A RETIREMENT ALLOWANCE FROM THE SYSTEM AND ELECTED BY THE RETIRED MEMBERS OR BENEFICIARIES RECEIVING A RETIREMENT ALLOWANCE FROM THE SYSTEMS ADMINISTERED BY THE BOARD, AND ONE MEMBER OF THE SYSTEM HAVING AT LEAST 10 YEARS OF CREDITABLE SERVICE AND ELECTED BY THE MEMBERS OF THE RETIREMENT SYSTEMS ADMINISTERED BY THE BOARD; TO PROVIDE FOR STAGGERED TERMS OF FOUR YEARS FOR TRUSTEES AFTER THE INITIAL TERMS; TO PROVIDE QUALIFICATIONS FOR THE APPOINTED AND ELECTED TRUSTEES; TO PROVIDE THAT THE GOVERNOR'S AND LIEUTENANT GOVERNOR'S APPOINTMENTS BE SUBJECT TO THE ADVICE AND CONSENT OF THE SENATE; TO AMEND SECTION 25-11-123, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE INCREASE IN THE EMPLOYER'S CONTRIBUTION RATE THAT IS SCHEDULED TO TAKE EFFECT ON JULY 1, 2024, IS RESCINDED AND SHALL NOT TAKE EFFECT, AND THE BOARD SHALL NOT PROVIDE FOR ANY INCREASE IN THE EMPLOYER'S CONTRIBUTION RATE THROUGH JUNE 30, 2024; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 25-11-15, Mississippi Code of 1972, is amended as follows:
25-11-15. (1) Board of trustees: The general administration and responsibility for the proper operation of the Public Employees' Retirement System and the federal-state agreement and for making effective the provisions of Articles 1 and 3 are vested in a board of trustees.
(2) (a) The board
shall consist of * * * eleven (11) trustees, as follows:
( * * *i) The State Treasurer;
* * *
(ii) The Commissioner of Revenue;
(iii) Four (4) members appointed by the Governor;
(iv) Three (3) members appointed by the Lieutenant Governor;
(v) One (1) retired member who is receiving a retirement allowance from the system, elected by the retired members or beneficiaries receiving a retirement allowance from the system and by the retired members or beneficiaries of the municipal systems, the firemen's and policemen's disability and relief funds and the Mississippi Highway Safety Patrol Retirement System administered by the board of trustees; and
(vi) One (1) member of the system having at least ten (10) years of creditable service, elected by the members of the system, the municipal systems and the Mississippi Highway Safety Patrol Retirement System.
(b) (i) For the terms beginning July 1, 2024, the appointed trustees shall serve terms of the following lengths: two (2) appointees of the Governor shall serve for an initial term ending on July 1, 2025; one (1) appointee of the Lieutenant Governor shall serve for an initial term ending on July 1, 2026; one (1) appointee of the Governor and one (1) appointee of the Lieutenant Governor shall serve for an initial term ending on July 1, 2027; and one (1) appointee of the Governor and one (1) appointee of the Lieutenant Governor shall serve for an initial term ending on July 1, 2028. After the expiration of the initial terms, their successors shall be appointed for terms of four (4) years from the expiration date of the previous term.
(ii) All appointments for the initial terms shall be made no later than May 31, 2024.
(iii) Each appointee of the Governor and the Lieutenant Governor shall be a person with knowledge and understanding of the investment of financial assets and of the principles of a retirement plan, as either a participant or an employer, and shall not have a conflict of interest with any plan administered by the board.
(iv) Two (2) of the members to be appointed by the Governor shall be appointed only after consideration of recommendations for those appointments made by the Speaker of the House to the Governor. Two (2) of the members to be appointed by the Lieutenant Governor shall be appointed only after consideration of recommendations for those appointments made by the Speaker of the House to the Lieutenant Governor.
(v) All appointments by the Governor and the Lieutenant Governor shall be subject to the advice and consent of the Senate. Members appointed when the Senate is not in session shall serve only until the end of the next regular session, unless confirmed by the Senate.
( * * *c) (i) In the * * * election to be held for trustees whose
terms begin July 1, 2024, one (1) member shall be elected for a term * * * ending on July 1, 2026;
and one (1) member shall be elected for a term * * * ending on July 1, 2028. Thereafter, their
successors shall be elected for terms of * * * four (4) years from the expiration
date of the previous term. All elections shall be held in accordance with
rules and regulations adopted by the board to govern those elections,
and the board shall be the sole judge of all questions arising incident to or
connected with the elections.
( * * *ii) The election for trustees whose
terms begin July 1, 2024, shall be held no later than May 31, 2024, with any necessary
runoffs occurring no later than June 21, 2024. Any person eligible to vote
for the election of a * * * trustee and who meets the
qualifications for the office may seek election to the office and serve if
elected. For purposes of determining eligibility to seek office as a member of
the board * * *,
the required creditable service in "the system" shall include each
system administered by the board * * * in which the person is a member.
* * *
(3) The trustees serving on the effective date of this act shall retain their positions through June 30, 2024. On July 1, 2024, the new members shall assume their positions.
( * * *4) If a vacancy occurs in the office of
a trustee, the vacancy shall be filled for the unexpired term in the same
manner as the office was previously filled. However, if the unexpired term of
an elected member is six (6) months or less, an election shall be held to fill
the office vacated for the next succeeding full term of office, and the person
so elected to fill the next full term shall be appointed by the board to fill
the remainder of the unexpired term. Whenever any member who is elected to a
position to represent a class of members ceases to be a member of that class,
that board member is no longer eligible for membership on the board. The position
shall be declared vacant, and the unexpired term shall be filled in the same
manner as the office was previously filled.
( * * *5) Each trustee shall, within ten (10)
days after his or her appointment or election, take an oath of office as provided
by law and, in addition, shall take an oath that he or she will diligently and
honestly administer the affairs of the board, and that he or she will not
knowingly violate or willingly permit to be violated any of the provisions of
law applicable to Articles 1 and 3. The oath shall be signed by the member
making it, certified by the officer before whom it is taken, and immediately
filed in the office of the Secretary of State.
( * * *6) Each trustee shall be entitled to one
(1) vote. Six (6) members shall constitute a quorum at any meeting of the board,
and a majority of those present shall be necessary for a decision.
( * * *7) Subject to the limitations of
Articles 1 and 3, the board shall establish rules and regulations for the administration
of the system created by those articles and for the transaction of its
business, and to give force and effect to the provisions of those articles wherever
necessary to carry out the intent and purposes of the Legislature. The cited
articles are remedial law and shall be liberally construed to accomplish their
purposes.
( * * *8) Notwithstanding any other law to
the contrary, in the event of a natural disaster or other occurrence that results
in the failure of the retirement system's computer system or a significant disruption
of the normal activities of the retirement system, the executive director of
the board, or his or her deputy, shall be authorized to contract with another
entity, governmental or private, during the period of the failure or disruption,
for services, commodities, work space and supplies as necessary to carry out
the administration of all systems and programs administered by the board. The
board shall be authorized to pay the reasonable cost of those services, commodities,
work space and supplies. At the meeting of the board next following the execution
of a contract authorized under this subsection, documentation of the contract,
including a description of the services, commodities, work space or supplies,
the price thereof and the nature of the disaster or occurrence, shall be
presented to the board and placed on the minutes of the board. Because of
their emergency nature, purchases made under this subsection shall not be
required to comply with the provisions of Section 31-7-13 or any other law
governing public purchases.
( * * *9) The computer equipment and
software owned by the Public Employees' Retirement System are assets of the
Trust Fund by virtue of the Constitution, Section 272-A and acquisition and
operation thereof shall be under the jurisdiction of the Public Employees' Retirement
System.
( * * *10) The board shall elect a chairman and
shall by a majority vote of all of its members appoint a secretary whose title
shall be executive director, who shall serve at the will and pleasure of the
board, who shall not be a member of the board of trustees, who shall be
entitled to membership in the system, and who shall act as secretary of the board.
The board of trustees shall employ such actuarial, investment, clerical
and other employees as are required to transact the business of the system, and
shall fix the compensation of all employees, subject to the rules and
regulations of the State Personnel Board.
( * * *11) Each member of the board shall
receive as compensation for his or her services Three Hundred Dollars ($300.00)
per month. All members of the board shall be reimbursed for their necessary
traveling expenses, which shall be paid in accordance with the requirements of
Section 25-3-41 or other applicable statutes with respect to traveling expenses
of state officials and employees on official business. All members of the
board shall be entitled to be members of the system and shall be entitled to
creditable service for all time served as a member of the board, except for the
retired * * *
member, who shall not be entitled to be a member of the system and who
shall be eligible to receive the retirement allowance and compensation for
services from the system while serving as a member of the board. Members of
the board who are employed in state service (as defined in Section 25-11-103)
shall not be required to take annual leave from their state service employment
while performing his or her official duties as a member of the board.
( * * *12) All expenses of the board
incurred in the administration of Articles 1 and 3 shall be paid from such funds
as may be appropriated by the Legislature for that purpose or from
administrative fees collected from political subdivisions or juristic entities
of the state. Each political subdivision of the state and each instrumentality
of the state or of a political subdivision or subdivisions that submit a plan
for approval by the board as provided in Section 25-11-11 shall reimburse the
board, for coverage into the administrative expense fund, its pro rata share of
the total expense of administering Articles 1 and 3 as provided by regulations
of the board.
( * * *13) The Lieutenant Governor may
designate two (2) Senators and the Speaker of the House of Representatives may
designate two (2) Representatives to attend any meeting of the Board of
Trustees of the Public Employees' Retirement System. The appointing authorities
may designate alternate members from their respective houses to serve when the regular
designees are unable to attend the meetings of the board. The legislative
designees shall have no jurisdiction or vote on any matter within the
jurisdiction of the board. For attending meetings of the board, the
legislators shall receive per diem and expenses, which shall be paid from the
contingent expense funds of their respective houses in the same amounts as provided
for committee meetings when the Legislature is not in session; however, no per
diem and expenses for attending meetings of the board will be paid while the
Legislature is in session. No per diem and expenses will be paid except for
attending meetings of the board without prior approval of the proper committee
in their respective houses.
SECTION 2. Section 25-11-123, Mississippi Code of 1972, is amended as follows:
25-11-123. All of the assets of the system shall be credited according to the purpose for which they are held to one (1) of four (4) reserves; namely, the annuity savings account, the annuity reserve, the employer's accumulation account, and the expense account.
(a) Annuity savings account. In the annuity savings account shall be accumulated the contributions made by members to provide for their annuities, including interest thereon which shall be posted monthly. Credits to and charges against the annuity savings account shall be made as follows:
(1) Beginning July 1, 2010, the employer shall cause to be deducted from the salary of each member on each and every payroll of the employer for each and every payroll period nine percent (9%) of earned compensation as defined in Section 25-11-103. Future contributions shall be fixed biennially by the board on the basis of the liabilities of the retirement system for the various allowances and benefits as shown by actuarial valuation; however, any member earning at a rate less than Sixteen Dollars and Sixty-seven Cents ($16.67) per month, or Two Hundred Dollars ($200.00) per year, shall contribute not less than One Dollar ($1.00) per month, or Twelve Dollars ($12.00) per year.
(2) The deductions provided in paragraph (1) of this subsection shall be made notwithstanding that the minimum compensation provided by law for any member is reduced by the deduction. Every member shall be deemed to consent and agree to the deductions made and provided for in paragraph (1) of this subsection and shall receipt for his full salary or compensation, and payment of salary or compensation less the deduction shall be a full and complete discharge and acquittance of all claims and demands whatsoever for the services rendered by the person during the period covered by the payment, except as to the benefits provided under Articles 1 and 3. The board shall provide by rules for the methods of collection of contributions from members and the employer. The board shall have full authority to require the production of evidence necessary to verify the correctness of amounts contributed.
(b) Annuity reserve. The annuity reserve shall be the account representing the actuarial value of all annuities in force, and to it shall be charged all annuities and all benefits in lieu of annuities, payable as provided in this article. If a beneficiary retired on account of disability is restored to active service with a compensation not less than his average final compensation at the time of his last retirement, the remainder of his contributions shall be transferred from the annuity reserve to the annuity savings account and credited to his individual account therein, and the balance of his annuity reserve shall be transferred to the employer's accumulation account.
(c) Employer's accumulation account. The employer's accumulation account shall represent the accumulation of all reserves for the payment of all retirement allowances and other benefits payable from contributions made by the employer, and against this account shall be charged all retirement allowances and other benefits on account of members. Credits to and charges against the employer's accumulation account shall be made as follows:
(1) On account of each
member there shall be paid monthly into the employer's accumulation account by
the employers for the preceding fiscal year an amount equal to a certain
percentage of the total earned compensation, as defined in Section 25-11-103,
of each member. The percentage rate of those contributions shall be fixed
biennially by the board on the basis of the liabilities of the retirement
system for the various allowances and benefits as shown by actuarial valuation.
* * * Political subdivisions joining Article 3 of the
Public Employees' Retirement System after July 1, 1968, may adjust the employer's
contributions by agreement with the Board of Trustees of the Public Employees'
Retirement System to provide service credits for any period before execution of
the agreement based upon an actuarial determination of employer's contribution
rates. From and after the effective date of this act, the increase in the employer's
contribution rate that is scheduled to take effect on July 1, 2024, is rescinded
and shall not take effect, and the board shall not provide for any increase in the
employer's contribution rate through June 30, 2024.
(2) On the basis of regular interest and of such mortality and other tables as are adopted by the board of trustees, the actuary engaged by the board to make each valuation required by this article during the period over which the accrued liability contribution is payable, immediately after making that valuation, shall determine the uniform and constant percentage of the earnable compensation of each member which, if contributed by the employer on the basis of compensation of the member throughout his entire period of membership service, would be sufficient to provide for the payment of any retirement allowance payable on his account for that service. The percentage rate so determined shall be known as the "normal contribution rate." After the accrued liability contribution has ceased to be payable, the normal contribution rate shall be the percentage rate of the salary of all members obtained by deducting from the total liabilities on account of membership service the amount in the employer's accumulation account, and dividing the remainder by one percent (1%) of the present value of the prospective future salaries of all members as computed on the basis of the mortality and service tables adopted by the board of trustees and regular interest. The normal rate of contributions shall be determined by the actuary after each valuation.
(3) The total amount payable in each year to the employer's accumulation account shall not be less than the sum of the percentage rate known as the "normal contribution rate" and the "accrued liability contribution rate" of the total compensation earnable by all members during the preceding year, provided that the payment by the employer shall be sufficient, when combined with the amounts in the account, to provide the allowances and other benefits chargeable to this account during the year then current.
(4) The accrued liability contribution shall be discontinued as soon as the accumulated balance in the employer's accumulation account shall equal the present value, computed on the basis of the normal contribution rate then in force, or the prospective normal contributions to be received on account of all persons who are at that time members.
(5) All allowances and benefits in lieu thereof, with the exception of those payable on account of members who receive no prior service credit, payable from contributions of the employer, shall be paid from the employer's accumulation account.
(6) Upon the retirement of a member, an amount equal to his retirement allowance shall be transferred from the employer's accumulation account to the annuity reserve.
(7) The employer's accumulation account shall be credited with any assets authorized by law to be credited to the account.
(d) Expense account. The expense account shall be the account to which the expenses of the administration of the system shall be charged, exclusive of amounts payable as retirement allowances and as other benefits provided herein. The Legislature shall make annual appropriations in amounts sufficient to administer the system, which shall be credited to this account. There shall be transferred to the State Treasury from this account, not less than once per month, an amount sufficient for payment of the estimated expenses of the system for the succeeding thirty (30) days. Any interest earned on the expense account shall accrue to the benefit of the system. However, notwithstanding the provisions of Sections 25-11-15(10) and 25-11-105(f)(v)5, all expenses of the administration of the system shall be paid from the interest earnings, provided the interest earnings are in excess of the actuarial interest assumption as determined by the board, and provided the present cost of the administrative expense fee of two percent (2%) of the contributions reported by the political subdivisions and instrumentalities shall be reduced to one percent (1%) from and after July 1, 1983, through June 30, 1984, and shall be eliminated thereafter.
(e) Collection of contributions. The employer shall cause to be deducted on each and every payroll of a member for each and every payroll period, beginning subsequent to January 31, 1953, the contributions payable by the member as provided in Articles 1 and 3.
The employer shall make deductions from salaries of employees as provided in Articles 1 and 3 and shall transmit monthly, or at such time as the board of trustees designates, the amount specified to be deducted to the Executive Director of the Public Employees' Retirement System. The executive director, after making a record of all those receipts, shall deposit such amounts as provided by law.
(f) (1) Upon the basis of
each actuarial valuation provided herein, the board of trustees shall
biennially determine the normal contribution rate and the accrued liability
contribution rate as provided in this section. The sum of these two (2) rates
shall be known as the "employer's contribution rate." * * * The percentage rate of those
contributions shall be fixed biennially by the board on the basis of the
liabilities of the retirement system for the various allowances and benefits as
shown by actuarial valuation.
(2) The amount payable by the employer on account of normal and accrued liability contributions shall be determined by applying the employer's contribution rate to the amount of compensation earned by employees who are members of the system. Monthly, or at such time as the board of trustees designates, each department or agency shall compute the amount of the employer's contribution payable, with respect to the salaries of its employees who are members of the system, and shall cause that amount to be paid to the board of trustees from the personal service allotment of the amount appropriated for the operation of the department or agency, or from funds otherwise available to the agency, for the payment of salaries to its employees.
(3) Except as otherwise provided in Section 25-11-106:
(i) Constables shall pay employer and employee contributions on their net fee income as well as the employee contributions on all direct treasury or county payroll income.
(ii) The county shall be responsible for the employer contribution on all direct treasury or county payroll income of constables.
(4) Except as otherwise provided in Section 25-11-106.1, chancery and circuit clerks shall be responsible for both the employer and employee share of contributions on the proportionate share of net income attributable to fees, as well as the employee share of net income attributable to direct treasury or county payroll income, and the employing county shall be responsible for the employer contributions on the net income attributable to direct treasury or county payroll income.
(5) Once each year, under procedures established by the system, each employer shall submit to the Public Employees' Retirement System a copy of their report to Social Security of all employees' earnings.
(6) The board shall provide by rules for the methods of collection of contributions of employers and members. The amounts determined due by an agency to the various funds as specified in Articles 1 and 3 are made obligations of the agency to the board and shall be paid as provided herein. Failure to deduct those contributions shall not relieve the employee and employer from liability thereof. Delinquent employee contributions and any accrued interest shall be the obligation of the employee and delinquent employer contributions and any accrued interest shall be the obligation of the employer. The employer may, in its discretion, elect to pay any or all of the interest on delinquent employee contributions. From and after July 1, 1996, under rules and regulations established by the board, all employers are authorized and shall transfer all funds due to the Public Employees' Retirement System electronically and shall transmit any wage or other reports by computerized reporting systems.
SECTION 3. This act shall take effect and be in force from and after its passage.
