Lawmakers pass PERS policy change
Published: March 9,2010
JACKSON — The Mississippi Senate passed a bill Tuesday that aims to prevent “double dipping” by state employees who retire and then return to work as part-time or contract workers for the government.
The bill would require state agencies to make a contribution to the Public Employees Retirement System (PERS) fund for those employees, even though the contract workers and part-time workers cannot accrue more time toward retirement.
Currently, neither the returning employees nor the agencies that hire them contribute to the retirement system.
Senate Finance chairman Dean Kirby, R-Pearl, said Tuesday that the bill would prevent “double-dipping.” He said many state employees retire and then soon return as contract workers.
“The purpose of the bill is to make sure our retirement system stays solvent,” Kirby said.
The bill would also extend the waiting period before a state retiree can return to work at an agency.
Currently, there’s a 45-day wait. The House passed a one-year wait, but the Senate changed that to 90 days.
Mississippi’s PERS has $18 billion in assets and pays out about $1.5 billion each year in benefits. The state currently has more than 20,000 employees eligible for immediate retirement.
Mississippi PERS covers nonfederal public employees. That includes people who work for state, county and city governments; public schools; universities; fire departments and law enforcement agencies.
Kirby said the bad economy and tight state budget have prompted some agencies to suggest that employees retire and then come back as part-time workers. That saves an agency money, because it only pays a part-time salary and no longer must pay into the retirement system for that worker. The employee would earn that salary, plus his or her state pension.
“That really hurts the retirement system,” Kirby said.
Sen. Hob Bryan, D-Amory, said if everyone who’s been working for 25 years were to retire at the same time, the system couldn’t withstand the financial demands.
“Every time we pay benefits to someone in their 40s and 50s, we take money away from those the system was intended for, those in their 60s,” Bryan said.
A different version of the bill passed the House earlier this session. The Senate version now goes back to the House, which can either accept the changes or seek final negotiations between the two chambers.
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