MISSISSIPPI LEGISLATURE
2015 Regular Session
To: Finance
By: Senator(s) Wiggins
AN ACT TO BE KNOWN AS THE UNIFORM MANAGEMENT OF PUBLIC EMPLOYEE RETIREMENT SYSTEMS; TO PROVIDE THAT THE ACT APPLIES TO ALL RETIREMENT PROGRAMS AND RETIREMENT SYSTEMS MAINTAINED BY THE STATE OR ANY POLITICAL SUBDIVISION OR INSTRUMENTALITY OF THE STATE, WITH CERTAIN EXCEPTIONS; TO PROVIDE THAT ALL ASSETS OF A RETIREMENT SYSTEM ARE HELD IN TRUST, AND THE TRUSTEE OF THE RETIREMENT SYSTEM HAS THE EXCLUSIVE AUTHORITY TO INVEST AND MANAGE THOSE ASSETS; TO AUTHORIZE THE TRUSTEE TO ESTABLISH AN ADMINISTRATIVE BUDGET SUFFICIENT TO PERFORM THE TRUSTEE'S DUTIES AND DRAW UPON ASSETS OF THE RETIREMENT SYSTEM TO FUND THE BUDGET; TO AUTHORIZE THE TRUSTEE TO OBTAIN BY EMPLOYMENT OR CONTRACT THE SERVICES NECESSARY TO EXERCISE THE TRUSTEE'S POWERS AND PERFORM THE TRUSTEE'S DUTIES; TO AUTHORIZE THE TRUSTEE TO DELEGATE CERTAIN FUNCTIONS; TO PRESCRIBE THE GENERAL DUTIES OF THE TRUSTEE AND PRESCRIBE THE DUTIES OF THE TRUSTEE IN INVESTING AND MANAGING THE ASSETS OF THE RETIREMENT SYSTEM; TO PROVIDE THAT A TRUSTEE WHO BREACHES A DUTY IMPOSED BY THIS ACT IS PERSONALLY LIABLE TO A RETIREMENT SYSTEM FOR ANY LOSSES RESULTING FROM THE BREACH AND ANY PROFITS MADE BY THE TRUSTEE THROUGH USE OF ASSETS OF THE SYSTEM BY THE TRUSTEE; TO PROVIDE THAT AN AGREEMENT THAT PURPORTS TO LIMIT THE LIABILITY OF A TRUSTEE FOR A BREACH OF DUTY UNDER THIS ACT IS VOID; TO REQUIRE THE ADMINISTRATOR OF A RETIREMENT SYSTEM TO DISSEMINATE TO THE PUBLIC A SUMMARY PLAN DESCRIPTION, ANNUAL DISCLOSURE OF FINANCIAL AND ACTUARIAL STATUS, AND AN ANNUAL REPORT; TO REQUIRE THE ADMINISTRATOR OF A RETIREMENT SYSTEM TO FURNISH TO EACH PARTICIPANT AND BENEFICIARY WHO IS RECEIVING BENEFITS UNDER A RETIREMENT PROGRAM CERTAIN INFORMATION ABOUT THE PROGRAM; TO REQUIRE THE ADMINISTRATOR OF A RETIREMENT SYSTEM TO FILE CERTAIN INFORMATION WITH THE RETIREMENT SYSTEM; TO AUTHORIZE ENFORCEMENT OF THE PROVISIONS OF THIS ACT BY AN ACTION MAINTAINED BY THE STATE OR A POLITICAL SUBDIVISION OF THE STATE OR BY A PARTICIPANT OR BENEFICIARY; TO BRING FORWARD SECTIONS 25-11-15, 25-11-101, 25-11-121, 25-11-123, 25-11-129, 25-11-133, 25-11-317, 25-11-319, 25-13-25, 25-13-31, 25-13-33, 21-29-11, 21-29-107, 21-29-125, 21-29-209, 21-29-227, 21-29-257 AND 21-29-307, MISSISSIPPI CODE OF 1972, FOR THE PURPOSES OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Short title. This act may be cited as the Uniform Management of Public Employee Retirement Systems (MPERS) Act.
SECTION 2. Definitions. (1) As used in this act:
(a) "Administrator" means the person primarily responsible for the management of a retirement system or, if no person is clearly designated, the trustee of the system who has the ultimate authority to manage the system.
(b) "Agent group of programs" means a group of retirement programs which shares administrative and investment functions but maintains a separate account for each retirement program so that assets accumulated for a particular program may be used to pay benefits only for that program's participants and beneficiaries.
(c) "Appropriate grouping of programs" means:
(i) For defined benefit plans, a cost-sharing program or an agent group of programs; and
(ii) For defined contribution plans, a group of retirement programs which shares administrative and investment functions.
(d) "Beneficiary" means a person, other than the participant, who is designated by a participant or by a retirement program to receive a benefit under the program.
(e) "Code" means the federal Internal Revenue Code of 1986, as amended.
(f) "Cost-sharing program" means a retirement program for the employees of more than one (1) public employer in which all assets accumulated for the payment of benefits may be used to pay benefits to any participants or beneficiaries of the program.
(g) "Defined benefit plan" means a retirement program other than a defined contribution plan.
(h) "Defined contribution plan" means a retirement program that provides for an individual account for each participant and for benefits based solely upon the amount contributed to the participant's account, and any income, expenses, gains and losses credited or charged to the account and any forfeitures of accounts of other participants that may be allocated to the participant's account.
(i) "Employee" includes an officer of a public employer.
(j) "Fair value" means the amount that a willing buyer would pay a willing seller for an asset in a current sale, as determined in good faith by a fiduciary.
(k) "Fiduciary" means a person who:
(i) Exercises any discretionary authority to manage a retirement system;
(ii) Exercises any authority to invest or manage assets of a system;
(iii) Provides investment advice for a fee or other direct or indirect compensation with respect to assets of a system or has any authority or responsibility to do so; or
(iv) Is a trustee or a member of a trustee board.
(e) "Furnish" means:
(i) To deliver personally, to mail to the last known place of employment or home address of the intended recipient, or, if reasonable grounds exist to believe that the intended recipient would receive it in ordinary course, to transmit by any other usual means of communication; or
(ii) To provide to the intended recipient's public employer if reasonable grounds exist to believe that the employer will make a good faith effort to deliver personally, by mail, or by other usual means of communication.
(m) "Governing law" means state and local laws establishing or authorizing the creation of a retirement program or system and the principal state and local laws and regulations governing the management of a retirement program or system or assets of either.
(n) "Guaranteed benefit policy" means an insurance policy or contract to the extent the policy or contract provides for benefits in a guaranteed amount. The term includes any surplus in a separate account, but excludes any other portion of a separate account.
(o) "Insurer" means a company, service, or organization qualified to engage in the business of insurance in this state.
(p) "Nonforfeitable benefit" means an immediate or deferred benefit that arises from a participant's service, is unconditional, and is enforceable against the retirement system.
(q) "Participant" means an individual who is or has been an employee enrolled in a retirement program and who is or may become eligible to receive or is currently receiving a benefit under the program, or whose beneficiaries are or may become eligible to receive a benefit. The term does not include an individual who is no longer an employee of a public employer and has not accrued any nonforfeitable benefits under that employer's retirement program.
(r) "Public employer" means this state or any political subdivision, or any agency or instrumentality of this state or any political subdivision, whose employees are participants in a retirement program.
(s) "Qualified public accountant" means:
(i) An auditing agency of this state or a political subdivision of this state that has no direct relationship with the functions or activities of a retirement system or its fiduciaries other than:
1. Functions relating to this act; or
2. A relationship between the system and the agency's employees as participants or beneficiaries on the same basis as other participants and beneficiaries; or
(ii) A person who is an independent certified public accountant, certified or licensed by a regulatory authority of a state.
(t) "Related person" of an individual means:
(i) The individual's spouse or a parent or sibling of the spouse;
(ii) The individual's descendant, sibling or parent, or the spouse of the individual's descendant, sibling or parent;
(iii) Another individual residing in the same household as the individual;
(iv) A trust or estate in which an individual described in subparagraph (i), (ii) or (iii) of this paragraph has a substantial interest;
(v) A trust or estate for which the individual has fiduciary responsibilities; or
(vi) An incompetent, ward or minor for whom the individual has fiduciary responsibilities.
(u) "Retirement program" means a program of rights and obligations which a public employer establishes or maintains and which, by its express terms or as a result of surrounding circumstances:
(i) Provides retirement income to employees; or
(ii) Results in a deferral of income by employees for periods extending to the termination of covered employment or beyond.
(v) "Retirement system" means an entity established or maintained by a public employer to manage one or more retirement programs, or to invest or manage the assets of one or more retirement programs.
(w) "Trustee" means a person who has ultimate authority to manage a retirement system or to invest or manage its assets.
(x) "This act" means Sections 1 through 19 of this act.
SECTION 3. Scope. This act applies to all retirement programs and retirement systems, except:
(a) A retirement program that is unfunded and is maintained by a public employer solely for the purpose of providing deferred compensation for a select group of management employees or employees who rank in the top five percent (5%) of employees of that employer based on compensation;
(b) A severance-pay arrangement under which:
(i) Payments are made solely on account of the termination of an employee's service and are not contingent upon the employee's retiring;
(ii) The total amount of the payments does not exceed the equivalent of twice the employee's total earnings from the public employer during the year immediately preceding the termination of service; and
(iii) All payments are completed within twenty-four (24) months after the termination of service;
(c) An arrangement or payment made on behalf of an employee because the employee is covered by Title II of the federal Social Security Act, as amended (42 USC Section 401 et seq.);
(d) A qualified governmental excess benefit arrangement within the meaning of Section 415(m) of the code;
(e) An individual retirement account or individual retirement annuity within the meaning of Section 408 of the code;
(f) A retirement program consisting solely of annuity contracts or custodial accounts satisfying the requirements of Section 403(b) of the code; or
(g) A program maintained solely for the purpose of complying with workers' compensation laws or disability insurance laws.
SECTION 4. Establishment of trust. (1) Except as otherwise provided in subsection (2) of this section, all assets of a retirement system are held in trust. The trustee has the exclusive authority, subject to this act, to invest and manage those assets.
(2) Assets of a retirement system which consist of insurance contracts or policies issued by an insurer, assets of an insurer, and assets of the system held by an insurer need not be held in trust.
(3) If an insurer issues a guaranteed benefit policy to a retirement system, assets of the system include the policy but not assets of the insurer.
(4) If a retirement system invests in a security issued by an investment company registered under the Investment Company Act of 1940 (15 USC Section 80a-1 et seq.), the assets of the system include the security, but not assets of the investment company.
SECTION 5. Powers of trustee. In addition to other powers conferred by the governing law, a trustee has exclusive authority, consistent with the trustee's duties under this act, to:
(a) Establish an administrative budget sufficient to perform the trustee's duties and, as appropriate and reasonable, draw upon assets of the retirement system to fund the budget;
(b) Obtain by employment or contract the services necessary to exercise the trustee's powers and perform the trustee's duties, including actuarial, auditing, custodial, investment and legal services; and
(c) Procure and dispose of the goods and property necessary to exercise the trustee's powers and perform the trustee's duties.
SECTION 6. Delegation of functions. (1) A trustee or administrator may delegate functions that a prudent trustee or administrator acting in a like capacity and familiar with those matters could properly delegate under the circumstances.
(2) The trustee or administrator shall exercise reasonable care, skill and caution in:
(a) Selecting an agent;
(b) Establishing the scope and terms of the delegation, consistent with the purposes and terms of the retirement program; and
(c) Periodically reviewing the agent's performance and compliance with the terms of the delegation.
(3) In performing a delegated function, an agent owes a duty to the retirement system and to its participants and beneficiaries to comply with the terms of the delegation and, if a fiduciary, to comply with the duties imposed by Section 7 of this act.
(4) A trustee or administrator who complies with subsections (1) and (2) of this section is not liable to the retirement system or to its participants or beneficiaries for the decisions or actions of the agent to whom the function was delegated.
(5) By accepting the delegation of a function from the trustee or administrator, an agent submits to the jurisdiction of the courts of this state.
(6) A trustee may limit the authority of an administrator to delegate functions under this section.
SECTION 7. General duties of trustee and fiduciary. A trustee or other fiduciary shall discharge duties with respect to a retirement system:
(a) Solely in the interest of the participants and beneficiaries;
(b) For the exclusive purpose of providing benefits to participants and beneficiaries and paying reasonable expenses of administering the system;
(c) With the care, skill and caution under the circumstances then prevailing which a prudent person acting in a like capacity and familiar with those matters would use in the conduct of an activity of like character and purpose;
(d) Impartially, taking into account any differing interests of participants and beneficiaries;
(e) Incurring only costs that are appropriate and reasonable; and
(f) In accordance with a good-faith interpretation of the law governing the retirement program and system.
SECTION 8. Duties of trustee in investing and managing assets of retirement system. (1) In investing and managing assets of a retirement system under Section 7 of this act, a trustee with authority to invest and manage assets:
(a) Shall consider among other circumstances:
(i) General economic conditions;
(ii) The possible effect of inflation or deflation;
(iii) The role that each investment or course of action plays within the overall portfolio of the retirement program or appropriate grouping of programs;
(iv) The expected total return from income and the appreciation of capital;
(v) Needs for liquidity, regularity of income and preservation or appreciation of capital; and
(vi) For defined benefit plans, the adequacy of funding for the plan based on reasonable actuarial factors;
(b) Shall diversify the investments of each retirement program or appropriate grouping of programs unless the trustee reasonably determines that, because of special circumstances, it is clearly prudent not to do so;
(c) Shall make a reasonable effort to verify facts relevant to the investment and management of assets of a retirement system;
(d) May invest in any kind of property or type of investment consistent with this act; and
(e) May consider benefits created by an investment in addition to investment return only if the trustee determines that the investment providing these collateral benefits would be prudent even without the collateral benefits.
(2) A trustee with authority to invest and manage assets of a retirement system shall adopt a statement of investment objectives and policies for each retirement program or appropriate grouping of programs. The statement shall include the desired rate of return on assets overall, the desired rates of return and acceptable levels of risk for each asset class, asset-allocation goals, guidelines for the delegation of authority and information on the types of reports to be used to evaluate investment performance. At least annually, the trustee shall review the statement and change or reaffirm it.
SECTION 9. Special application of duties. (1) A trustee may return a contribution to a public employer or employee, or make alternative arrangements for reimbursement, if the trustee determines the contribution was made because of a mistake of fact or law.
(2) Upon termination of a retirement program, a trustee may return to a public employer any assets of the program remaining after all liabilities of the program to participants and beneficiaries have been satisfied.
(3) If a retirement program provides for individual accounts and permits a participant or beneficiary to exercise control over the assets in such an account and a participant or beneficiary exercises control over those assets:
(a) The participant or beneficiary is not a fiduciary by reason of the exercise of control; and
(b) A person who is otherwise a fiduciary is not liable for any loss, or by reason of any breach of fiduciary duty, resulting from the participant's or beneficiary's exercise of control.
(4) If an insurer issues to a retirement system a contract or policy that is supported by the insurer's general account, but is not a guaranteed benefit policy, the insurer complies with Section 7 of this act if it manages the assets of the general account with the care, skill and caution under the circumstances then prevailing which a prudent person acting in a like capacity and familiar with those matters would use in the conduct of an activity of like character and purpose, taking into account all obligations supported by the general account.
SECTION 10. Reviewing compliance. (1) Compliance by a trustee or other fiduciary with Sections 6 through 8 of this act shall be determined in light of the facts and circumstances existing at the time of the trustee or fiduciary's decision or action and not by hindsight.
(2) A trustee's investment and management decisions shall be evaluated not in isolation but in the context of the trust portfolio as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the program or appropriate grouping of programs.
SECTION 11. Liability of trustee or other fiduciary. (1) A trustee or other fiduciary who breaches a duty imposed by this act is personally liable to a retirement system for any losses resulting from the breach and any profits made by the trustee or other fiduciary through use of assets of the system by the trustee or other fiduciary. The trustee or other fiduciary is subject to other equitable remedies as the court considers appropriate, including removal.
(2) An agreement that purports to limit the liability of a trustee or other fiduciary for a breach of duty under this act is void.
(3) A retirement system may insure itself against liability or losses occurring because of a breach of duty under this act by a trustee or other fiduciary.
(4) A trustee or other fiduciary may insure against liability or losses occurring because of a breach of duty under this act if the insurance is purchased or provided either by the trustee or fiduciary personally or, on the trustee or fiduciary's behalf, by this state, the retirement system, a public employer whose employees participate in a retirement program served by the trustee or fiduciary, an employee representative whose members participate in a retirement program served by the trustee or fiduciary or the trustee or fiduciary's employer.
SECTION 12. Disclosure to public. (1) An administrator of a retirement system shall prepare and disseminate:
(a) A summary plan description of each retirement program;
(b) A summary description of any material modification in the terms of the program and any material change in the information required to be contained in the summary plan description, to the extent the modification or change has not been integrated into an updated summary plan description;
(c) An annual disclosure of financial and actuarial status; and
(d) An annual report.
(2) An administrator shall make available for public examination in the principal office of the administrator and in other places if necessary to make the information reasonably available to participants:
(a) The governing law of the retirement program and system;
(b) The most recent summary plan description;
(c) Summary descriptions of modifications or changes described in subsection (1)(b) of this section that have been provided to participants and beneficiaries but not yet integrated into the summary plan description;
(d) The most recent annual disclosure of financial and actuarial status; and
(e) The most recent annual report.
(3) Upon written request by a participant, beneficiary or member of the public, the administrator shall provide a copy of any publication described in subsection (2) of this section. Except as otherwise provided in Section 13(1) of this act, the administrator may charge a reasonable fee to cover the cost of providing copies and shall provide the copies within thirty (30) days after receiving payment.
SECTION 13. Disclosure to participants and beneficiaries. (1) An administrator shall furnish to each participant and to each beneficiary who is receiving benefits under a retirement program:
(a) A copy of the most recent summary plan description, along with any summary descriptions of modifications or changes described in Section 12(1)(b) of this act, within three (3) months after a person becomes a participant or, in the case of a beneficiary, within three (3) months after a person first receives benefits, or, if later, within four (4) months after the retirement program becomes subject to this act;
(b) The summary description of any modifications or changes described in Section 12(1)(b) of this act, within seven (7) months after the end of the fiscal year in which a modification or change has been made;
(c) A copy of an updated summary plan description that integrates all modifications and changes at intervals not exceeding five (5) years; and
(d) The annual report within seven (7) months after the end of each fiscal year.
(2) An administrator shall provide to a participant or beneficiary a statement containing information that would permit the participant or beneficiary to estimate projected benefits reasonably, to the extent the information is regularly maintained by the retirement system. The information shall be provided with the annual report or upon written request of the participant or beneficiary. The information need not be provided to a participant or beneficiary who is currently receiving benefits.
(3) A participant who is not currently receiving benefits is entitled without charge to one (1) statement under subsection (2) of this section during any fiscal year. The administrator may charge a reasonable fee to cover the cost of providing other statements. The administrator shall provide the statements within thirty (30) days after the participant or beneficiary's request or, if a fee is charged, within thirty (30) days after receiving payment.
SECTION 14. Reports to agency. An administrator shall file with the retirement system a copy of:
(a) The governing law of the retirement program and system within four (4) months after the system becomes subject to this act and an updated copy at least once every year thereafter;
(b) The summary plan description within four (4) months after the system becomes subject to this act and of updated summary plan descriptions at the same time they are first furnished to any participant or beneficiary under Section 13(1)(c) of this act;
(c) Any summary description of modifications or changes within seven (7) months after the end of the fiscal year in which a modification or change has been made; and
(d) The annual disclosure of financial and actuarial status and annual report within seven (7) months after the end of each fiscal year.
SECTION 15. Summary plan description. (1) A summary plan description and a summary description of modifications or changes under Section 12(1)(b) of this act shall be written in a manner calculated to be understood by the average participant and be accurate and sufficiently comprehensive reasonably to inform the participants and beneficiaries of their rights and obligations under the retirement program.
(2) A summary plan description shall contain:
(a) The name of the retirement program and system and type of administration;
(b) The name and business address of the administrator;
(c) The name and business address of each agent for service of process;
(d) Citations to the governing law of the retirement program and system;
(e) A description of the program's requirements respecting eligibility for participation and benefits;
(f) A description of the program's provisions providing for nonforfeitable benefits;
(g) A description of circumstances that may result in disqualification, ineligibility or denial or loss of benefits;
(h) A description of the benefits provided by the program, including the manner of calculating benefits and any benefits provided for spouses and survivors;
(i) The source of financing of the program;
(j) The identity of any organization through which benefits are provided;
(k) The date the fiscal year ends;
(l) The procedures to claim benefits under the program and the administrative procedures available under the program for the redress of claims that are denied in whole or in part; and
(m) Notice of the availability of additional information under Sections 12(2) and (3), 13(2) and (3) and 14 of this act.
SECTION 16. Annual disclosure of financial and actuarial
status. An annual disclosure of financial and actuarial
status shall contain:
(a) The name of the retirement system and identification of each retirement program and, when programs are in an appropriate grouping of programs, of each appropriate grouping of programs;
(b) The name and business address of the administrator;
(c) The name and business address of each trustee and each member of a trustee board and a brief description of how the trustee or member was selected;
(d) The name and business address of each agent for the service of process;
(e) The number of employees covered by each retirement program not in an appropriate grouping of programs, or by each appropriate grouping of programs, or both;
(f) The name and business address of each fiduciary;
(g) The current statement of investment objectives and policies required by Section 8(2) of this act;
(h) Financial statements and notes to the financial statements in conformity with generally accepted accounting principles;
(i) An opinion on the financial statements by a qualified public accountant in conformity with generally accepted auditing standards;
(j) In the case of a defined benefit plan, actuarial schedules and notes to the actuarial schedules in conformity with generally accepted actuarial principles and practices for measuring pension obligations;
(k) In the case of a defined benefit plan, an opinion by a qualified actuary that the actuarial schedules are complete and accurate to the best of the actuary's knowledge, that each assumption and method used in preparing the schedules is reasonable, that the assumptions and methods in the aggregate are reasonable, and that the assumptions and methods in combination offer the actuary's best estimate of anticipated experience;
(l) A description of any material interest, other than the interest in the retirement program itself, held by any public employer participating in the system or any employee organization representing employees covered by the system in any material transaction with the system within the last three (3) years or proposed to be effected;
(m) A description of any material interest held by any trustee, administrator or employee who is a fiduciary with respect to the investment and management of assets of the system, or by a related person, in any material transaction with the system within the last three (3) years or proposed to be effected;
(n) A schedule of the rates of return, net of total investment expense, on assets of the system overall and on assets aggregated by category over the most recent one (1), three (3), five (5) and ten (10) year periods, to the extent available, and the rates of return on appropriate benchmarks for assets of the system overall and for each category over each period;
(o) A schedule of the sum of total investment expense and total general administrative expense for the fiscal year expressed as a percentage of the fair value of assets of the system on the last day of the fiscal year, and an equivalent percentage for the preceding five (5) fiscal years; and
(p) A schedule of all assets held for investment purposes on the last day of the fiscal year aggregated and identified by issuer, borrower, lessor or similar party to the transaction stating, if relevant, the asset's maturity date, rate of interest, par or maturity value, number of shares, cost and fair value and identifying any asset that is in default or classified as uncollectible.
SECTION 17. Annual report. (1) An annual report shall contain:
(a) The name and business address of each trustee and each member of a trustee board;
(b) The financial statements, but not the notes, required by Section 16(h) of this act;
(c) For defined benefit plans, the actuarial schedules, but not the notes, required by Section 16(j) of this act;
(d) The schedules described in Section 16(n) and (o) of this act;
(e) A brief description of and information about how to interpret the statements and schedules;
(f) Other material necessary to summarize fairly and accurately the annual disclosure of financial and actuarial status; and
(g) Notice of the availability of additional information pursuant to Sections 12(2) and (3), 13(2) and (3) and 14 of this act.
SECTION 18. Enforcement. (1) An action may be maintained by:
(a) A public employer, participant, beneficiary or fiduciary:
(i) To enjoin an act, practice or omission that violates this act;
(ii) For appropriate equitable relief for a breach of trust under Section 11 of this act; or
(iii) For other appropriate equitable relief to redress the violation of or to enforce this act; or
(b) The retirement system to enjoin any violation of Section 14 of this act.
(2) In an action under this section by a participant, beneficiary or fiduciary, the court may award reasonable attorney fees and costs to either party.
SECTION 19. Alienation of benefits. Benefits of a retirement program may not be assigned or alienated and shall be exempt from claims of creditors, except as otherwise provided by state law.
SECTION 20. Section 25-11-15, Mississippi Code of 1972, is brought forward 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) The board shall consist of ten (10) trustees, as follows:
(a) The State Treasurer;
(b) One (1) member who shall be appointed by the Governor for a term of four (4) years, who shall be a member of the system;
(c) Two (2) members of the system having at least ten (10) years of creditable service who are state employees who are not employees of the state institutions of higher learning, who shall be elected by members of the system who are employees of state agencies and by members of the Mississippi Highway Safety Patrol Retirement System, but not by employees of the state institutions of higher learning;
(d) Two (2) members of the system having at least ten (10) years of creditable service who do not hold office in the legislative or judicial departments of municipal or county government, one (1) of whom shall be an employee of a municipality, instrumentality or juristic entity thereof, who shall be elected by members of the system who are employees of the municipalities, instrumentalities or juristic entities thereof and by members of the municipal systems and the firemen's and policemen's disability and relief funds administered by the board of trustees, and one (1) of whom shall be an employee of a county, instrumentality or juristic entity thereof, who shall be elected by members of the system who are employees of the counties, instrumentalities or juristic entities thereof;
(e) One (1) member of the system having at least ten (10) years of creditable service who is an employee of a state institution of higher learning, who shall be elected by members of the system who are employees of the state institutions of higher learning as included in Section 37-101-1. Any member of the board on July 1, 1984, who is an employee of an institution of higher learning shall serve as the member trustee representing the institutions of higher learning until the end of the term for which he or she was elected;
(f) Two (2) retired members who are receiving a retirement allowance from the system, who shall be 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, to serve for a term of six (6) years under rules and regulations adopted by the board to govern that election; however, any retired member of the board in office on April 19, 1993, shall serve as a retired trustee until the end of the term for which he or she was elected;
(g) One (1) member of the system having at least ten (10) years of creditable service who is an employee of any public school district or junior college or community college district that participates in the system, who shall be elected by the members of the system who are employees of any public school district or junior college or community college district; however, any member of the board on June 30, 1989, who is a certified classroom teacher shall serve as the member representing a classroom teacher until the end of the term for which the member was appointed;
(h) In the first election to be held for trustees one (1) member shall be elected for a term of two (2) years, and one (1) member for a term of four (4) years, and one (1) member for a term of six (6) years. Thereafter, their successors shall be elected for terms of six (6) years. 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.
(i) Any person eligible to vote for the election of a member of the board of trustees 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 of trustees, the required creditable service in "the system" shall include each system administered by the board of trustees in which the person is a member.
The members described above and serving on the board on June 30, 1989, shall continue to serve on the board until the expiration of their terms.
(3) 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 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.
(4) 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.
(5) 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.
(6) 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.
(7) 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.
(8) 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.
(9) 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, 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.
(10) 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 members, 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.
(11) 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.
(12) 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 21. Section 25-11-101, Mississippi Code of 1972, is brought forward as follows:
25-11-101. A retirement system is hereby established and placed under the management of the board of trustees for the purpose of providing retirement allowances and other benefits under the provisions of this article for officers and employees in the state service and their beneficiaries. The retirement system provided by this article shall go into operation as of the first day of the month following the effective date thereof, when contributions by members shall begin and benefits shall become payable.
This system shall be an agency of the State of Mississippi having all the powers and privileges of a public corporation and shall be known as the "Public Employees' Retirement System of Mississippi." By such name all of its business shall be transacted, all of its funds invested, and all of its cash and securities and other property held; but in ordinary correspondence the word "system" may be used instead of the full title. After appropriation for administrative expenses and after payment of investment management fees and costs, all funds of the system shall be held in trust in the custody of the board of trustees as funds of the beneficiaries of the trust. The Joint Legislative Committee on Performance Evaluation and Expenditure Review is hereby authorized and directed to have performed random actuarial evaluations, as necessary, of the funds and expenses of the Public Employees' Retirement System and to make annual reports to the Legislature on the financial soundness of the system.
SECTION 22. Section 25-11-121, Mississippi Code of 1972, is brought forward as follows:
25-11-121. (1) The board shall, from time to time, determine the current requirements for benefit payments and administrative expense which shall be maintained as a cash working balance, except that such cash working balance shall not exceed at any time an amount necessary to meet the current obligations of the system for a period of ninety (90) days. Any amounts in excess of such cash working balance shall be invested, as follows:
(a) Funds may be deposited in any institution insured by the Federal Deposit Insurance Corporation that maintains a facility that takes deposits in the State of Mississippi or a custodial bank;
(b) Corporate bonds and taxable municipal bonds; or corporate short-term obligations of corporations or of wholly owned subsidiaries of corporations, whose short-term obligations are rated A-2 or better by Standard and Poor's, rated P-2 or better by Moody's Investment Service, F-2 or better by Fitch Ratings, Ltd., or the equivalent of these ratings if assigned by another United States Securities and Exchange Commission designated Nationally Recognized Statistical Rating Organization;
(c) Agency and nonagency residential and commercial mortgage-backed securities and collateralized mortgage obligations;
(d) Asset-backed securities;
(e) Bank loans;
(f) Convertible bonds;
(g) Bonds of the Tennessee Valley Authority;
(h) Bonds, notes, certificates and other valid obligations of the United States, and other valid obligations of any federal instrumentality that issues securities under authority of an act of Congress and are exempt from registration with the Securities and Exchange Commission;
(i) Bonds, notes, debentures and other securities issued by any federal instrumentality and fully guaranteed by the United States;
(j) Interest-bearing revenue bonds or notes or bonds or notes which are general obligations of any state in the United States or of any city or county therein;
(k) Bonds of established non-United States companies and foreign government securities. The board may take requisite action to effectuate or hedge transactions or invest in currency through foreign or domestic banks, including the purchase and sale, transfer, exchange, or otherwise disposal of, and generally deal in foreign exchange through the use of foreign currency, interbank forward contracts, futures contracts, options contracts, swaps and other related derivative instruments, notwithstanding any other provisions of this article to the contrary;
(l) Shares of stocks, common and/or preferred, of corporations created by or existing under the laws of the United States or any state, district or territory thereof and shares of stocks, common and/or preferred, and convertible securities of non-United States companies; provided:
(i) The maximum investments in stocks shall not exceed eighty percent (80%) of the total book value of the total investment fund of the system;
(ii) The stock of such corporation shall:
1. Be listed on a national stock exchange; or
2. Be traded in the over-the-counter market;
(iii) The outstanding shares of such corporation shall have a total market value of not less than Fifty Million Dollars ($50,000,000.00);
(iv) The amount of investment in any one (1) corporation shall not exceed three percent (3%) of the book value of the assets of the system;
(v) The shares of any one (1) corporation owned by the system shall not exceed five percent (5%) of that corporation's outstanding stock.
The board may take requisite action utilizing foreign currency as an investment vehicle, or to effectuate or hedge transactions for shares of stocks and convertible securities of non-United States companies through foreign or domestic banks, including the purchase and sale, transfer, exchange, or otherwise disposal of, and generally deal in foreign exchange through the use of foreign currency, interbank forward contracts, futures contracts, options contracts, swaps and other related derivative instruments, notwithstanding any other provisions of this article to the contrary;
(m) Covered call and put options on securities or indices traded on one or more of the regulated exchanges;
(n) Pooled or commingled funds managed by a corporate trustee or by a Securities and Exchange Commission registered investment advisory firm retained as an investment manager by the board of trustees, and shares of investment companies and unit investment trusts registered under the Investment Company Act of 1940, where such pooled or commingled funds or shares are comprised of common or preferred stocks, bonds, money market instruments or other investments authorized under this section. Such investment in commingled funds or shares shall be held in trust; provided that the total book value of investments under this paragraph shall at no time exceed five percent (5%) of the total book value of all investments of the system. Any investment manager approved by the board of trustees shall invest such commingled funds or shares as a fiduciary;
(o) Pooled or commingled real estate funds or real estate securities managed by a corporate trustee or by a Securities and Exchange Commission registered investment advisory firm retained as an investment manager by the board of trustees. Such investment in commingled funds or shares shall be held in trust; provided that the total book value of investments under this paragraph shall at no time exceed ten percent (10%) of the total book value of all investments of the system. Any investment manager approved by the board of trustees shall invest such commingled funds or shares as a fiduciary. The ten percent (10%) limitation in this paragraph shall not be subject to the five percent (5%) limitation in paragraph (n) of this subsection;
(p) Types of investments not specifically authorized by this subsection if the investments are in the form of a separate account managed by a Securities and Exchange Commission registered investment advisory firm retained as an investment manager by the board; or a limited partnership or commingled fund approved by the board; provided that the total book value of investments under this paragraph shall at no time exceed ten percent (10%) of the total book value of all investments of the system. Any person or entity who exercises any discretionary authority or discretionary control respecting management of the separate account, limited partnership or commingled fund, or who exercises any authority or control respecting management or disposition of the assets of the separate account, limited partnership or commingled fund, shall exercise such authority or control as a fiduciary.
(2) All investments shall be acquired at prices not exceeding the prevailing market values for such investments.
(3) Any limitations herein set forth shall be applicable only at the time of purchase and shall not require the liquidation of any investment at any time. All investments shall be clearly marked to indicate ownership by the system and to the extent possible shall be registered in the name of the system.
(4) Subject to the above terms, conditions, limitations and restrictions, the board shall have power to sell, assign, transfer and dispose of any of the securities and investments of the system, provided that said sale, assignment or transfer has the majority approval of the entire board. The board may employ or contract with investment managers, evaluation services or other such services as determined by the board to be necessary for the effective and efficient operation of the system.
(5) Except as otherwise provided herein, no trustee and no employee of the board shall have any direct or indirect interest in the income, gains or profits of any investment made by the board, nor shall any such person receive any pay or emolument for his services in connection with any investment made by the board. No trustee or employee of the board shall become an endorser or surety, or in any manner an obligor for money loaned by or borrowed from the system.
(6) All interest derived from investments and any gains from the sale or exchange of investments shall be credited by the board to the account of the system.
(7) The board of trustees shall credit regular interest to the annuity savings account monthly. Regular interest shall mean such per centum rate to be compounded annually as set by the board of trustees through regulation.
(8) The board of trustees shall be the custodian of the funds of the system. All retirement allowance payrolls shall be certified by the executive director who shall furnish the board a surety bond in a company authorized to do business in Mississippi in such an amount as shall be required by the board, the premium to be paid by the board from the expense account.
(9) For the purpose of meeting disbursements for retirement allowances, annuities and other payments, cash may be kept available, not exceeding the requirements of the system for a period of ninety (90) days, on deposit in one or more banks or trust companies organized under the laws of the State of Mississippi or the laws of the United States, provided that the sum on deposit in any one (1) bank or trust company shall not exceed thirty-five percent (35%) of the paid-up capital and regular surplus of such bank or trust company.
(10) The board, the executive director and employees shall discharge their duties with respect to the investments of the system solely for the interest of the system with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent investor acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, including diversifying the investments of the system so as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so.
(11) Documentary material or data made or received by the system which consists of trade secrets or commercial or financial information that relates to the investments of the system shall be exempt from the Mississippi Public Records Act of 1983 if the disclosure of the material or data is likely to impair the system's ability to obtain such information in the future, or is likely to cause substantial harm to the competitive position of the person or entity from whom the information was obtained.
SECTION 23. Section 25-11-123, Mississippi Code of 1972, is brought forward 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. Beginning January 1, 1990, the rate shall be fixed at nine and three-fourths percent (9-3/4%). The board shall reduce the employer's contribution rate by one percent (1%) from and after July 1 of the year following the year in which the board determines and the board's actuary certifies that the employer's contribution rate can be reduced by that amount without causing the unfunded accrued actuarial liability amortization period for the retirement system to exceed twenty (20) years. 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.
(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." Beginning on earned compensation effective January 1, 1990, the rate computed as provided in this section shall be nine and three-fourths percent (9-3/4%). The board shall reduce the employer's contribution rate by one percent (1%) from and after July 1 of the year following the year in which the board determines and the board's actuary certifies that the employer's contribution rate can be reduced by that amount without causing the unfunded accrued actuarial liability amortization period for the retirement system to exceed twenty (20) years. 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 24. Section 25-11-129, Mississippi Code of 1972, is brought forward as follows:
25-11-129. (1) The right of a person to an annuity, a retirement allowance or benefit, or to the return of contributions, or to any optional benefit or any other right accrued or accruing to any person under the provisions of Articles 1 and 3, the system and the monies in the system created by said articles, are hereby exempt from any state, county or municipal ad valorem taxes, income taxes, premium taxes, privilege taxes, property taxes, sales and use taxes or other taxes not so named, notwithstanding any other provision of law to the contrary, and exempt from levy and sale, garnishment, attachment or any other process whatsoever, and shall be unassignable except as specifically otherwise provided in this article and except as otherwise provided in subsection (2) of this section.
(2) Any retired member or beneficiary receiving a retirement allowance or benefit under this article may authorize the system to make deductions from the retirement allowance or benefit for the payment of employer or system sponsored group life or health insurance. The deductions authorized under this subsection shall be subject to rules and regulations adopted by the board.
SECTION 25. Section 25-11-133, Mississippi Code of 1972, is brought forward as follows:
25-11-133. (1) The maintenance of actuarial reserves for the various allowances and benefits under Articles 1 and 3, and the payment of all annuities, retirement allowances, refunds and other benefits granted hereunder are made obligations of the employer's accumulation accounts. All income, interest and dividends derived from deposits and investments authorized by those articles shall be used for the payment of the obligations of the system.
(2) In the event of the termination of the Public Employees' Retirement System established pursuant to the provisions of Section 25-11-101 et seq., all members of the system as of the date of termination of the system shall be deemed to have a vested right to benefits to the extent and in the same manner that rights would be vested under the statute existing as of the date of termination of the system, except that any member who, because of a termination of the system has not fulfilled the requirements for length of service, shall nonetheless be entitled to compensation as of the date that such member would otherwise be eligible, with such compensation to be computed on the basis of time actually a member of the service and compensation actually earned during the time a member, in the manner now provided by statute.
In the event of a deficit in the availability of funds for payment due under the provisions of the Public Employees' Retirement System, an appropriation shall be made sufficient for the payment thereof as an obligation of the state.
(3) (a) Notwithstanding any provisions of this section or this title to the contrary, the maximum annual retirement allowance attributable to the employer contributions payable by the system to a member shall be subject to the limitations set forth in Section 415 of the Internal Revenue Code and any regulations issued thereunder as applicable to governmental plans as the term is defined under Section 414(d) of the Internal Revenue Code.
(b) The board is authorized to provide by rule or regulation for the payment of benefits as provided under this chapter to members or beneficiaries of the retirement system at a time and under circumstances not otherwise provided for in this chapter to the extent that the payment is required to maintain the system as a qualified retirement plan for purposes of federal income tax laws.
(4) Notwithstanding any other provision of this plan, all distributions from this plan shall conform to the regulations issued under Section 401(a)(9) of the Internal Revenue Code, applicable to governmental plans, as defined in Section 414(d) of the Internal Revenue Code, including the incidental death benefit provisions of Section 401(a)(9)(G) of the Internal Revenue Code. Further, the regulations shall override any plan provision that is inconsistent with Section 401(a)(9) of the Internal Revenue Code.
(5) The actuarial assumptions used to convert a retirement allowance from the normal form of payment to an optional form of payment shall be an appendix to Article 3 and subject to approval by the board based upon certification by the actuary.
(6) Notwithstanding any other provision of this plan, the maximum compensation that can be considered for all plan purposes shall not be greater than that allowed under Section 401(a)(17) of the Internal Revenue Code.
SECTION 26. Section 25-11-317, Mississippi Code of 1972, is brought forward as follows:
25-11-317. (1) The general administration and responsibility for the proper operation of the plan and for making effective the provisions hereof are vested in the Board of Trustees of the Public Employees' Retirement System of Mississippi.
(2) The board shall invest all funds in accordance with Section 25-11-121.
(3) The board shall designate an actuary who shall be the technical advisor of the board on matters regarding the operation of the plan and shall perform such other duties as are required in connection therewith.
(4) At least once in each two-year period following the date of establishment, the actuary shall make an actuarial investigation into the mortality, service and compensation experience of the members and beneficiaries of the plan and shall make a valuation of the contingent assets and liabilities of the plan.
(5) On the basis of regular interest and tables last adopted by the board, the actuary shall make biennial valuation of the contingent assets and liabilities of the plan.
(6) The board shall keep such data as shall be necessary for the actuarial valuation of the contingent assets and liabilities of the plan and for checking the experience of the plan.
(7) The board shall determine from time to time the rate of regular interest for use in all calculations, with the rate of five percent (5%) per annum applicable unless changed by the board.
(8) Subject to the limitations hereof, the board from time to time shall establish rules and regulations for the administration of the plan and for the transaction of business.
(9) The board shall keep a record of all its proceedings under this article which shall be open to public inspection, except for individual member records. The system shall not disclose the name, address or contents of any individual member records without the prior written consent of the individual to whom the record pertains.
(10) The Executive Secretary of the Public Employees' Retirement System of Mississippi shall serve as the executive secretary of the plan.
SECTION 27. Section 25-11-319, Mississippi Code of 1972, is brought forward as follows:
25-11-319. (1) The right of a person to an annuity, a retirement allowance or benefit, or to the return of contributions, or to any optional benefit or any other right accrued or accruing to any person under the provisions of the Supplemental Legislative Retirement Plan, and the monies in the plan created by this article, are exempt from any state or municipal tax, and exempt from levy and sale, garnishment, attachment or any other process whatsoever, and shall be unassignable except as specifically otherwise provided in this article.
(2) Any retired member or beneficiary receiving a retirement allowance or benefit under this article may authorize the system to make deductions from the retirement allowance or benefit for the payment of employer or system sponsored group life or health insurance. The deductions authorized under this subsection shall be subject to rules and regulations adopted by the board.
SECTION 28. Section 25-13-25, Mississippi Code of 1972, is brought forward as follows:
25-13-25. There is established an administrative board for the Mississippi Highway Safety Patrol Retirement System, which shall be composed of the Commissioner of Public Safety, four (4) active members of the retirement system elected by the active members of the system, and one (1) retired member of the retirement system elected by the retired members of the system. The administrative board, with approval of the Attorney General, may make any and all regulations necessary for the efficient, orderly and successful operation of this chapter, not inconsistent herewith. This is a remedial chapter and entitled to a broad and liberal interpretation to accomplish its purpose.
SECTION 29. Section 25-13-31, Mississippi Code of 1972, is brought forward as follows:
25-13-31. (1) The right of a person to an annuity, a retirement allowance or benefit, or to the return of contributions, or to any optional benefits or any other right accrued or accruing to any person under the provisions of the Highway Patrol Retirement Law, the system and the monies in the system created by said law, are hereby exempt from any state, county or municipal ad valorem taxes, income taxes, premium taxes, privilege taxes, property taxes, sales and use taxes or other taxes not so named, notwithstanding any other provision of law to the contrary, and exempt from levy and sale, garnishment, attachment, or any other process whatsoever, and shall be unassignable except as specifically otherwise provided in this article.
(2) Any retired member or beneficiary receiving a retirement allowance or benefit under this article may authorize the Public Employees' Retirement System to make deductions from the retirement allowance or benefit for the payment of employer or system sponsored group life or health insurance. The deductions authorized under this subsection shall be subject to rules and regulations adopted by the Board of Trustees of the Public Employees' Retirement System.
SECTION 30. Section 25-13-33, Mississippi Code of 1972, is brought forward as follows:
25-13-33. (1) The maintenance of actuarial reserves for the various allowances and benefits under this chapter, and the payment of all annuities, retirement allowances, refunds and other benefits granted under this chapter are made obligations of the disability and relief fund. All income, interest and dividends derived from deposits and investments authorized by this chapter shall be used for the payment of the obligations of the system.
(2) In the event of the termination of the Mississippi Highway Safety Patrol Retirement System, established pursuant to the provisions of Section 25-13-1 et seq., all members of the system as of the date of termination of the system shall be deemed to have a vested right to benefits to the extent and in the same manner that rights would be vested under the statute existing as of the date of termination of the system; except that any member who, because of a termination of the system has not fulfilled the requirements for length of service, shall be entitled to compensation as of the date that such member would otherwise be eligible, with such compensation to be computed on the basis of time actually a member of the service and compensation actually earned during the time as a member, in the manner now provided by statute.
In the event of a deficit in the availability of funds for payment due under the provisions of the Mississippi Highway Safety Patrol Retirement System, an appropriation shall be made sufficient for the payment thereof as an obligation of the State of Mississippi.
(3) (a) Notwithstanding any provisions of this section or chapter to the contrary, the maximum annual retirement allowance attributable to the employer contributions payable by the system to a member shall be subject to the limitations set forth in Section 415 of the Internal Revenue Code and any regulations issued thereunder as applicable to governmental plans as the term is defined under Section 414(d) of the Internal Revenue Code.
(b) The Board of Trustees of the Public Employees' Retirement System is authorized to provide by rule or regulation for the payment of benefits as provided under this chapter to members or beneficiaries of the Highway Safety Patrol Retirement System at a time and under circumstances not otherwise provided for in this chapter to the extent that the payment is required to maintain the Highway Safety Patrol Retirement System as a qualified retirement plan for purposes of federal income tax laws.
(4) Notwithstanding any other provision of this plan, all distributions from this plan shall conform to the regulations issued under Section 401(a)(9) of the Internal Revenue Code, applicable to governmental plans, as defined in Section 414(d) of the Internal Revenue Code, including the incidental death benefit provisions of Section 401(a)(9)(G) of the Internal Revenue Code. Further, such regulations shall override any plan provision that is inconsistent with Section 401(a)(9) of the Internal Revenue Code.
(5) The actuarial assumptions used to convert a retirement allowance from the normal form of payment to an optional form of payment shall be an appendix to this chapter and subject to approval by the board of trustees based upon certification by the actuary.
(6) Notwithstanding any other provision of this plan, the maximum compensation that can be considered for all plan purposes shall not be greater than that allowed under Section 401(a)(17) of the Internal Revenue Code.
SECTION 31. Section 21-29-11, Mississippi Code of 1972, is brought forward as follows:
21-29-11. The general administration and responsibility for the proper operation of the retirement system and for making effective the provisions of this article are hereby vested in the board, the members of which shall serve without compensation except as otherwise provided by law. The board shall organize and adopt such rules and regulations as it may deem necessary and promptly do such things as may properly be done.
The board shall have, in addition to all others, the following rights, powers and duties:
(a) It shall keep minutes of its proceedings which shall be open to public inspection;
(b) Fix a time for regular meetings and provide for the means of calling special meetings;
(c) A majority of all of the board members present shall constitute a quorum for transaction of the affairs of the board;
(d) To hear, consider and pass upon all applications coming before it and order payments as provided by this article, and the board may hear witnesses and administer oaths, appoint hearing officers and make decisions in all matters properly before said board;
(e) It shall have full power to invest and reinvest the funds of the retirement system under the provisions of Section 25-11-121. Moreover, said board shall have full power to order the custodian of securities and funds hereafter designated to hold, purchase, sell, assign, transfer and dispose of any of the securities and investments in which any of the funds created herein shall have been invested, as well as the proceeds of said investments and all moneys belonging to said funds. The funds held by the board may be commingled with other Public Employees' Retirement System investments for the most advantageous investments;
(f) It shall annually determine and allow interest on each individual account in the employees' saving fund based on the average percentage of interest earned from investment or deposit of all funds of the retirement system. However, the interest to be credited to such individual accounts shall not exceed one percent (1%) per annum.
SECTION 32. Section 21-29-107, Mississippi Code of 1972, is brought forward as follows:
21-29-107. The board of trustees shall fix a time for regular meetings in its minutes, and it shall keep minutes of its meetings which shall be public records, subject to the statutes, rules and regulations governing the board of trustees.
The board shall have the power and duty to promptly hear and pass upon all applications of firemen and/or policemen or the beneficiaries of deceased firemen and of deceased policemen for participation in the benefits of said fund. The board may appoint hearing officers to further its duties hereunder. Said board may hear witnesses, administer oaths, find facts, and make decisions in all matters properly before said board, which decisions shall be final except upon appeals in the way hereafter set forth. Said board may order payments made according to the facts found and the provisions of this article, which payments shall be made as far as funds may be available from each separate municipal fund. Said board shall have the power, with the funds they have on hand, to invest and reinvest funds under the provisions of Section 25-11-121. Such funds may be commingled with other system funds for the most advantageous investments; however, each fund shall have separate accounting status. No warrant shall be drawn against said fund without the approval of a majority of said board.
SECTION 33. Section 21-29-125, Mississippi Code of 1972, is brought forward as follows:
21-29-125. The authority is vested in the board of trustees to invest such part of said fund as may not be immediately required, in investments authorized under Section 25-11-121 with the right to change said investment from time to time, and with the right and duty to convert invested funds into current funds as the same may be needed for the purpose of this article.
SECTION 34. Section 21-29-209, Mississippi Code of 1972, is brought forward as follows:
21-29-209. The board shall fix a time for regular meetings in its minutes and it shall keep minutes of its meetings, which shall be public records. Special meetings may be held upon the call of the chairman of the board or any two (2) members thereof, upon twenty-four (24) hours' written notice, stating the purpose of the meeting, or at any time when all members are present.
The board shall have the duty and power to promptly hear and pass upon all applications of firemen and/or policemen or of beneficiaries of deceased firemen and of deceased policemen for participation in the benefits of said fund. Said board may hear witnesses, administer oaths, find facts, and make decisions in all matters properly before said board, which decisions shall be final except upon appeals in the way hereafter set forth. Said board shall order payments made according to the facts found and the provisions of this article, which payments shall be made as far as funds may be available. The board may invest the funds as provided in Section 25-11-121, and such funds may be commingled with other system funds for the most advantageous investments; however, each fund shall have separate accounting status.
SECTION 35. Section 21-29-227, Mississippi Code of 1972, is brought forward as follows:
21-29-227. The authority is vested in the board of trustees to invest such part of said fund as may not be immediately required, in investments authorized under Section 25-11-121 with the right to change said investment from time to time, and with the right and duty to convert invested funds into current funds as the same may be needed for the purposes of this article.
SECTION 36. Section 21-29-257, Mississippi Code of 1972, is brought forward as follows:
21-29-257. No part of said fund to which any of said firemen or policemen shall be entitled, or which may be payable or ordered paid to him shall be seized, attached, assigned or levied upon by any writ of attachment, garnishment, execution, sequestration or other like process or writ.
SECTION 37. Section 21-29-307, Mississippi Code of 1972, is brought forward as follows:
21-29-307. (1) The right of a person to an annuity, a retirement allowance, or benefit, or to the return of contributions, or to any optional benefit or any other right accrued or accruing to any person under the provisions of Articles 1, 3 or 5 of this chapter; the system; and the monies in the system created by such articles, are hereby exempt from any state, county or municipal ad valorem taxes, income taxes, premium taxes, privilege taxes, property taxes, sales and use taxes, or other taxes not so named, notwithstanding any other provision of law to the contrary, and exempt from levy and sale, garnishment, attachment or any other process whatsoever, and shall be unassignable except as specifically otherwise provided in Article 1, 3 or 5 of this chapter effective January 1, 1988, and except as otherwise provided in subsection (2) of this section.
(2) Any retired member or beneficiary receiving a retirement allowance or benefit under Article 1, 3 or 5 of this chapter may authorize the Public Employees' Retirement System to make deductions from the retirement allowance or benefit for the payment of employer or system sponsored group life or health insurance. The deductions authorized under this subsection shall be subject to rules and regulations adopted by the Board of Trustees of the Public Employees' Retirement System.
SECTION 38. Sections 1 through 19 of this act shall be codified as a new Article 13 in Chapter 11, Title 25, Mississippi Code of 1972.
SECTION 39. This act shall take effect and be in force from and after July 1, 2015.