PERS is a defined benefit plan that is designed to provide a monthly retirement benefit to employees at time of retirement. 2023 Magnolia Tribune. The modest benefit that retirees earn through PERS, when combined with their Social Security benefit, enables them to contribute to the states economy and avoid living in poverty after paying taxes, health care, and other living expenses. However, they have the option to receive the cost-of-living adjustment each month. COLA payments increased from $699 million in 2019 to $751 million in 2020, an increase of 7.44 percent. here One would change the cost-of-living adjustment often referred to as the "13th check" from a yearly lump sum to a monthly addition to benefits. Further, 93 percent of benefits paid to PERS retirees remains in the states economy, generating $4.63 in total economic activity for the state for every $1.00 invested by Mississippi taxpayers. Use of and/or registration on any portion of this site constitutes acceptance of our User Agreement (updated 4/4/2023), Privacy Policy and Cookie Statement, and Your Privacy Choices and Rights (updated 7/1/2023). If you do not have an existing account, you can also easily use an existing Google, Facebook or Apple account. Changes should not be made that impact the current retirees. December 15, 2020 (Tuesday) COLA. Questions arise about future of public retirees' 13th check - WLBT Vesting Period prior to July 1, 2007 All rights reserved. Employer (taxpayer) contributions made up only 29 percent of pension revenues over the same 30-year period. All Mississippians benefit from the services PERS members provide. Virtually every industry sector in the state benefited from increased revenues due to the injection of these retirement system dollars into the states economy. (Illinois does not tax any retirement income, including IMRF pension payments.). A perk of some pension programs, the 13 th check refers to an extra check retirees (and in some cases, employees) receive at the end of a fiscal year if a pension fund has performed better than. For some of the older retirees, the 13th check can be almost as much as . Models run by the actuaries show savings of more than $10 billion dollars, ensuring the plans viability more than a quarter century into the future. HB 472 changed the way PERS computes the COLA (which was once computed at a rate of 2.5 percent of the original benefit), which was designed to help retirees benefit checks keep up with the rate of inflation. Oh Really? If you make changes that affect current employees (future retirees) they are able to make their retirement plans based on that information. . This COLA is better known as the 13th check since many retirees take it in a lump sum at years end. Only if PERS were to cease operations completely would everyones benefit need to be paid out in single day a very unlikely scenario. "The unintended consequences of that bill would be very detrimental to the system," PERS director Pat Robertson said Thursday at the Capitol. I would rather not have a reduction in the dollar amount of the pension, Biden is already assuring me that even relatively adequate pension will be next to worthless shortly. Payments are scheduled for July 7, 2023. Know the Facts about PERS | Mississippi Retired Public - MRPEA Our mission is toresearch and share educational information that fosters greater economic freedom and individual responsibility. If you are an existing Print subscriber click HERE for your login info. In fiscal year 2016, PERS distributed $2.4 billion in benefits, 93 percent of which stay within the state of Mississippi. Another idea by the PERS staff is to change the COLA for new hires by either reducing the rate, tying it to the U.S. Consumer Price Index like Social Security or making it ad-hoc subject to Board of Trustees approval annually. You gain access to:- profiles and social posts A grand bargain might be reached to apply changes to PERS' COLA, better known statewide as the "13 th check" since most retirees decide to take it in year-end, lump sum form. PDF Retiree Handbook - Mississippi Funding for the trust fund comes from three sources. External Relations: Moira Delaney Hannah Nelson Caroline Presnell We all have worked to be able to return now you are taking away the help that we do get. The 13th check refers to an extra check some pension systems may issue to its pensioners at the end of the fiscal year if a pension fund does unexpectedly well. Comprehensive Annual Financial Reports (CAFR). The COLA was no small part of the deficit between contributions and payments that grew to $1.2 billion last year., Given the trends, the question before Mississippi leaders and taxpayers alike is, How sustainable is the 13th Check?, Senate Appropriations Vice Chairman Sen. Brice Wiggins told Yall Politics this is not an issue unique to Mississippi, Nationwide, states continue to struggle with how to pay for their obligations to retirees and potential retirees. But what are the elements of a good company slogan? "Rumors are about 90 percent of the way things happen here at the Capitol and they're always based on something that was heard," added Representative Jay Hughes.Representatives Tom Miles and Jay Hughes have posted concerns over a rumor that there might be a push next year to do away with the "COLA" (13th check) for retirees during the coming session. PERS manages a trust fund to provide retirement benefits to current and future public retirees. PERS of Mississippi Recipient ID: Account Owner ID: Date of Signature Signature of Benefit Recipient www.pers.ms.gov Public Employees' Retirement System of Mississippi 429 Mississippi Street, Jackson, MS 39201-1005 800.444.7377 601.359.3589 601.359.6707, fax Each year, the cost of the plans COLA which amounts to three percent of the annual retirement allowance for each full fiscal year of retirement until the retired member reaches age 60 increases dramatically even though the rate isnt tied to inflation like Social Security. The goal of any reform is to ensure that promises to present retirees are honored while making sure taxpayers, who are legally bound by court decisions and state law, wont need to finance an enormous bailout. Per the study, DB plans provide a more efficient use of taxpayer funds when offering retirement benefits to state and local government employees. Tech: Matt Latourelle Ryan Burch Kirsten Corrao Beth Dellea Travis Eden Tate Kamish Margaret Kearney Eric Lotto Joseph Sanchez. Direct Deposit 2021. "Not all Republicans are trying to undermine the retirement system. DB plans such as PERS encourage employee loyalty enabling employers to limit the high cost of employee turnover. Below is a political column by the Bigger Pie Forum: On October 13, the federal Social Security Administrationannounceda 5.9 percent cost of living increase for Social Security. Kirk Fordice. Wheres the by line? First, participating Mississippi public employers make required contributions to the fund. The COLA amount could be frozen for several years, meaning the amount a retiree received as last years 13th check would not be increased or decreased for some number of years. Its not a popular move especially among lawmakers who must appropriate the state funds, and city and county governments which will have to pay more again after the last increase was approved by the PERS Board of Trustees two years ago. The third source of funding comes from investment income. Proponents of the 13th check believe that pensioners are entitled to the money that results from positive returns of pension funds. PERS actuaries recommend that the taxpayer contribution be increased again from 17.4 percent to 19.6 percent. On the other hand, DC plans are portable, facilitating the movement of employees from one job to the next. For nearly two decades, he has reported and offered analysis on government, public policy, business and matters of faith. As a condition of their employment, they are required to contribute to PERS (currently at a rate of 9.00 percent of their total salary) through deductions from their paychecks with the promise that they will receive retirement benefits at some point in the future after meeting all eligibility requirements. Each IMRF employer contributes .62% of its IMRF member payroll to pay for the 13th payment. Over the 30-year period that ended June 30, 2016, mandatory employee contributions and earnings from investments covered 71 percent of the cost of the public retirement system in Mississippi. Companies spend millions to create them to define and market their companies. 1. Change the 13th check in anyway it going to put a burden on people that are already retired. PERS has outlined some pending legislation this year: From age 60, the three percent rate for PERS COLA is compounded for each fiscal year. Colorado presents an excellent example of how to solve for solvency. Contact our team to suggest an update. Current employees should be grandfathered in period. Mississippi Employment Agreement of Executive with Deferred The proposal is in Senate Bill 2140, by Republican Sen. Sean Tindell of Gulfport. This practice is controversial, as rates of return vary from year to year and actuaries use an average rate of return over several years to make estimates on pension health. Jackson Jambalaya: Is the 13th Check Unlucky for PERS? - Blogger And there's talk on social media that it could be in jeopardy next session. This practice is controversial, as rates of return vary from year to year and actuaries use an average rate of return over several years to make estimates on pension health. By joining our newsletter, you are confirming that you agree with the Privacy Policy. For example: Once you receive your first 13th Payment, you will receive one every year unless your pension payments are suspended for some reason, such as for a return to work for an IMRF employer. A grand bargain might be reached to apply changes to PERS COLA, better known statewide as the 13th check since most retirees decide to take it in year-end, lump sum form. For more information, click here to visit our Retiree Resources page. Opponents, meanwhile, believe that pension managers should set that money aside for years where the rate of return is lower than expected. "I think there's a tendency that people forget that the wall and halls of the Capitol talk and seem to leak out," said Representative Tom Miles. The Mississippi Retired Public Employees Association (MRPEA), founded in 1985, is a non-profit organization that serves as an advocacy group for retired and active members of the Public Employees Retirement System of Mississippi (PERS). Use ADP's Mississippi Paycheck Calculator to estimate net or "take home" pay for either hourly or salaried employees. We shouldn't back up on it. You can access up-to-date information about your 13th Payment through your Member Access account. When you first retire, you must have retired on or before June 30 to receive a 13th payment the next year. Click There will be COLAs for the following plan retirees in accordance with their plan rules. By browsing this site, we may share your information with our social media partners in accordance with our Privacy Policy. 1-800-444-7377. Mississippi Paycheck Calculator | ADP I agree that it should not affect those retirees that are already receiving their retirement benefits. Kelly arrested for taking pics of Rose Cochran, PERS gets mo' money but funding level falls, Majority black public school districts spend more, waste more, fail more. PDF Understanding your lump sum COLA Notice - Mississippi Sen. Wiggins expects this discussion will be on the table as Appropriations works through the state budget process this session. Jackson's water bond failure: The REST of the story. At that rate of increase, the 13th Check could exceed $1 billion before the end of the next decade due to the manner in which the benefit is calculated. Car Tag Renewal. 2005: $211,530,000, As JJ states in their analysis, The funding level has fluctuated around 60% over the last five years despite two employer contribution increases of 300 basis points. Sid Salter: Bryant Never Strayed Far From Deputy S SWAC-MEAC Baseball Tourney Comes to Smith-Wills, Presenting the Mississippi State Capitol (Video). You must always receive IMRF pension payments for the previous 12 months in a row in order to receive a 13th Payment. -- Article credit to the Editorial Board of the Bigger Pie Forum --, https://www.northsidesun.com/politics-columns-press-releases/bpf-tie-pers-cola-rate-inflation. Help support local news by making a donation today. For more information, click here to visit our Retiree Resources page. Due diligence requires us to continue to look at such ways. COLAs help ensure that retiree purchasing power remains relatively the same no matter how long a retiree may live and how quickly prices might rise. This was proposed by the PERS commission put together by then-Gov. Opportune Time for PERS and the Legislature To - Magnolia Tribune if(document.getElementsByClassName("reference").length==0) if(document.getElementById('Footnotes')!==null) document.getElementById('Footnotes').parentNode.style.display = 'none'; Communications: Alison Graves Carley Allensworth Abigail Campbell Sarah Groat Erica Shumaker Caitlin Vanden Boom . First, either the rate of compounding (reducing it from 3 percent to 2.5 percent is one proposal by PERS executive director Ray Higgins and his staff) or changing it from compound to simple would pay huge dividends in 2047, when the actuaries say the plan will be fully funded under several scenarios. Unlike social media, we vet sources, fact-check, and have roots embedded in our local community.