GOVERNOR BARBOUR CALLS SPECIAL SESSION TO FIX STATE RETIREMENT SYSTEM

State employees – not taxpayers – should increase contributions

Jackson, Miss. – Governor Haley Barbour called a Special Session
today to increase state, city, county and school district employees’
contribution into the retirement system by less than 2 percent to ensure
the pension remains solvent. If approved, it would be the first increase
in employee contributions since 1991.

The session will begin at 1 p.m. today and will run concurrently with
the remaining days of the regular legislative session. Legislators are
in Jackson this week to finalize the Fiscal Year 2011 budget.

“Nobody here likes this; however, both Houses understand that we have
to protect our state employees’ future pensions, and we have to
protect our pension recipients today,” Governor Barbour said in a
press conference today. “If we don’t do this then $70 million will
be lost to the general fund which will undoubtedly result in people
being laid off, perhaps 1,000 or more layoffs if departments and
agencies have to take this out of their budgets.”

Employee contributions to the Public Employee Retirement System,
currently 7.25 percent, would increase to 9 percent to keep the program
in line with requirements of the Governmental Accounting Standards
Board. The increase would place more than $70 million into the system
from state workers and another $20 million from city, county and school
district employees.

Without the increase from state workers, the money would be taken from
agency budgets, which are already strained by budget cuts and low
revenue projections for next year. Employee contributions have not risen
in almost 20 years while taxpayer payments into the pension plan have
steadily risen to 12 percent.

Governor Barbour said there should be a fair balance of contributions
paid by the employee and the taxpayer.