Thursday, January 26, 2012

Republican idea for fixing PERS? Let's put our money in mortgage-backed securities!!!

Republicans spent the last election cycle saying that Democrats were engaging in scare tactics regarding PERS and taking pledges not to mess with the 13th check.

Well, guess what?  The Republican assault on PERS has begun. Sen. Joey Fillingane (R-Sumrall) has fired the first shot in the form of SB 2218 filed earlier this week. Here's the "short" title of the bill (full text of the bill is available by clicking the title):

AN ACT TO AMEND SECTION 25-11-103, MISSISSIPPI CODE OF 1972, TO REVISE CERTAIN DEFINITIONS RELATING TO THE LAWS GOVERNING THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM; TO REVISE THE DEFINITION OF THE TERM "BENEFICIARY" TO MAKE IT CLEAR THAT, IN THE EVENT THAT A MEMBER OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM DIES BEFORE RETIREMENT AND THE SPOUSE AND/OR CHILDREN ARE NOT ENTITLED TO A RETIREMENT ALLOWANCE ON THE BASIS THAT THE DECEASED MEMBER DID NOT HAVE THE REQUISITE NUMBER OF YEARS OF SERVICE, THE TYPE OF SERVICE TO WHICH IS REFERRED IS MEMBERSHIP SERVICE; TO REVISE THE DEFINITION OF THE TERM "CHILD" TO CLARIFY THAT A NATURAL CHILD OF A MEMBER OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM IS ONE THAT IS CONCEIVED BEFORE THE DEATH OF THE MEMBER; TO REVISE THE DEFINITION OF THE TERM "EARNED COMPENSATION" TO EXCLUDE FROM EARNED COMPENSATION THE VALUE OF MAINTENANCE FURNISHED AND TO EXCLUDE THE VALUE OF ANY IN-KIND BENEFITS FROM THE COMPUTATION OF EARNED COMPENSATION; TO AMEND SECTION 25-11-109, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT CREDITABLE SERVICE FOR MEMBERS OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM FOR PERIODS OF TIME AFTER JULY 1, 2013, SHALL BE AWARDED IN MONTHLY INCREMENTS; TO PROVIDE THAT THE COMPUTATION OF UNUSED LEAVE FOR CREDITABLE SERVICE FOR MEMBERS WHO RETIRE ON OR AFTER JULY 1, 2013, SHALL BE CALCULATED IN MONTHLY INCREMENTS; TO MAKE IT CLEAR THAT LEAVE CREDIT FOR ELECTED OFFICIALS WHO ARE MEMBERS OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM IS IN LIEU OF, AND NOT IN ADDITION TO, LEAVE EARNED WHILE SIMULTANEOUSLY EMPLOYED IN A NONELECTED POSITION IN THE SYSTEM; TO AMEND SECTION 25-11-113, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT A MEMBER OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM WHO APPLIES FOR A DISABILITY RETIREMENT ALLOWANCE MUST PROVIDE SUFFICIENT OBJECTIVE MEDICAL EVIDENCE IN SUPPORT OF THE CLAIM AND TO DEFINE "OBJECTIVE MEDICAL EVIDENCE"; TO AMEND SECTION 25-11-114, MISSISSIPPI CODE OF 1972, TO MAKE IT CLEAR THAT IF A MEMBER OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM DIES BEFORE BEING QUALIFIED FOR A FULL, UNREDUCED RETIREMENT ALLOWANCE, THE REDUCTION FACTOR FOR THE ANNUITY OF THE SURVIVING SPOUSE SHALL BE BASED ON THE NUMBER OF YEARS THAT WOULD HAVE BEEN REQUIRED FOR THE DECEASED MEMBER TO QUALIFY FOR A FULL, UNREDUCED RETIREMENT ALLOWANCE; TO MAKE IT CLEAR THAT IN ORDER FOR BENEFITS FOR A DEATH OR DISABILITY THAT OCCURS IN THE PERFORMANCE OF DUTY TO BE PAYABLE, THE DEATH OR
DISABILITY MUST HAVE BEEN AS A DIRECT RESULT OF A PHYSICAL INJURY SUSTAINED FROM AN ACCIDENT OR A TRAUMATIC EVENT CAUSED BY EXTERNAL VIOLENCE OR PHYSICAL FORCE OCCURRING IN THE PERFORMANCE OF DUTY; TO AMEND SECTION 25-11-119, MISSISSIPPI CODE OF 1972, TO AUTHORIZE DISCLOSURE OF CERTAIN CONFIDENTIAL MEMBER INFORMATION TO THE MEMBER'S CURRENT OR FORMER EMPLOYER; TO AMEND SECTION 25-11-121, MISSISSIPPI CODE OF 1972, TO REVISE THE INVESTMENT OPTIONS FOR EXCESS FUNDS OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM TO REFLECT THE CURRENT INVESTMENT ENVIRONMENT; TO AMEND SECTION 25-13-11, MISSISSIPPI CODE OF 1972, TO REVISE THE EARLY RETIREMENT FORMULA FOR THE MISSISSIPPI HIGHWAY SAFETY PATROL RETIREMENT SYSTEM TO PROVIDE THAT THE RETIREMENT ANNUITY SHALL BE REDUCED BY AN ACTUARIALLY DETERMINED PERCENTAGE OR FACTOR, RATHER THAN 3% AS IN CURRENT LAW, FOR EACH YEAR OF AGE BELOW 55 OR FOR EACH YEAR OF SERVICE BELOW 25, WHICHEVER IS THE LESSER; TO AMEND SECTIONS 25-11-111.1, 25-13-11.1 AND 21-29-325, MISSISSIPPI CODE OF 1972, TO AUTHORIZE THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM TO MAKE PAYMENTS OF RETIREMENT BENEFITS TO MEMBERS OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM, THE MISSISSIPPI HIGHWAY SAFETY PATROL RETIREMENT SYSTEM AND THE MUNICIPAL RETIREMENT SYSTEMS IT ADMINISTERS, BY WHATEVER MEANS IT DEEMS MOST APPROPRIATE AND TO AUTHORIZE ALTERNATE MEANS OF PAYMENT IF THE MEMBER OR BENEFICIARY CAN DEMONSTRATE THAT PAYMENT BY THE PRESCRIBED MEANS WILL CAUSE UNDUE HARDSHIP; TO AMEND SECTION 25-9-120, MISSISSIPPI CODE OF 1972, TO EXEMPT ACTUARIAL OR INVESTMENT MANAGEMENT SERVICES CONTRACTS ENTERED INTO BY THE BOARD OF TRUSTEES OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM FROM THE RULES AND REGULATIONS OF THE PERSONAL SERVICE CONTRACT REVIEW BOARD THAT GOVERN SOLICITATION AND SELECTION OF CONTRACTUAL SERVICES PERSONNEL; AND FOR RELATED PURPOSES.


There are provisions in the bill that would change the way leave time is calculated at retirement, make it more difficult to get a disability retirement allowance, and allow the PERS Board to determine how to credit someone's service.  There's other stuff in there as well, and folks will be pouring over this for the next few days to figure out all of the implications of the bill.

My favorite part, though, is the language that would let PERS retirement funds be invested in mortgage-backed securities (see lines 1241-1243).  You may recall mortgage-backed securities as the investment vehicle that nearly ended America in 2008.

Sen. Fillingane's bill was assigned to the Senate Finance Committee, of which he is the chairman.

1 comment:

billy b said...

I wonder if Fillingane has any actual idea, clue, or education in anything at all related to derivitives, "credit-default swaps", or anything at all related to the mortgage investment business. I highly doubt it, or he would never endorse such nonsense. he is merely doing, writing under his name, and submitting what the big brokerage and fund manager boys, who contribute to the business PAC's that fund any and all things Republican Party/candidate related here in Mississippi under our state's completely out-of-date campaign finance regulations. They tell him to jump, he responds "how high gentlemen"?