Mississippi Litigation Review & Commentary

Mississippi Litigation Review & Commentary

Comments on the Latest Developments in Mississippi Civil Litigation

Philip is a trial attorney based in Jackson, Mississippi with a diverse civil litigation practice.

Category Archives: Mississippi Public Employer’s Retirement System (PERS)

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George Will on the Looming Pension Crisis

Posted in Mississippi Public Employer's Retirement System (PERS)
Conservative columnist George Will wrote this article about America’s looming pension crisis. From the article: Nowadays, America’s most persistent public dishonesties are the wildly optimistic, but politically convenient, expectations for returns on pension fund investments. Last year, when Illinois reduced its expected return on its teachers’ retirement fund from 7.5 percent to 7, this meant… Continue Reading

Experts Say Tell Florida Its 7.6% PERS Investment Return Assumption Is Too High

Posted in Mississippi Public Employer's Retirement System (PERS)
The Orlando Sentinel reported last week on a report from the State’s actuarial consultant that stated that Florida’s PERS investment return assumption of 7.6% is too high. The actuaries recommended a 7% investment return assumption. Financial models showed that there was less than a 35% chance of meeting the assumed 7.6%: The consultants developed financial… Continue Reading

State Budget Proposals Will Only Make PERS Problems Worse

Posted in Mississippi Public Employer's Retirement System (PERS), Politics in Mississippi
In Kingfish’s recent post on PERS he discussed the structural problems PERS has with growing retiree roles vs. enrolled workers. That problem is apparently guaranteed to get worse with Mississippi’s budget problems. Lat week at Mississippi Today Adam Ganucheau reported on the legislature’s plans for the 2018 budget. Those plans include eliminating 1,999 vacant state… Continue Reading

Kingfish Analyzes PERS Structural Problems

Posted in Mississippi Public Employer's Retirement System (PERS), Politics in Mississippi
Last week in this post on Jackson Jambalaya Kingfish analyzed the recent column by PERS director Pat Robertson that I discussed here. Kingfish notes that PERS has problems despite the fact that it has been meeting its investment return assumption that I have been so critical of: The problem PERS faces is structural in nature. … Continue Reading

PERS Director Now Says 60% Funding is Good

Posted in Mississippi Public Employer's Retirement System (PERS)
Last week PERS executive director Pat Robertson published an article in the state press responding to criticism of Mississippi’s public employees retirement system. Think Kevin Bacon at the end of Animal House. From the article: Our funded status means we have approximately 60 percent of the funds needed to pay not only all current benefits,… Continue Reading

Does PERS Have 2 Sets of Books?

Posted in Mississippi Public Employer's Retirement System (PERS)
Last week the New York Times published this Mary Williams Walsh article regarding public pensions having two sets of books. Why the difference? The dreaded investment return projections that I have discussed in many prior posts on this topic. According to the article, public pensions only disclose the financials with the optimistic projections even though… Continue Reading

Mississippi’s PERS Funding Ratio is 10th Worst in the Nation

Posted in Mississippi Public Employer's Retirement System (PERS)
According to this Bloomberg report, Mississippi’s PERS funding ratio of 60.9% as of 2014 was the 10th worst in the nation. Here is a link. Given the performance of the equity markets, it seems odd that Mississippi’s funding ratio decreased from 67.3% in 2009 to 60.9% in 2014. Regardless, with asset values at all time… Continue Reading

PERS Suffers Negative Yearly Investment Return

Posted in Mississippi Public Employer's Retirement System (PERS)
Mississippi’s PERS website links its quarterly investment report for the period ending March 31, 2016: PERS Investement Report.03.31.16. The report reflects that the total fund’s return for the period ending 3/31/2016 was  minus .47%. As a reminder, PERS is modeled on an unrealistic investment return assumption of 7.75%. The fund made money in private equity,… Continue Reading

PERS Update: Fairy Dust in Investment Return Assumptions?

Posted in Mississippi Public Employer's Retirement System (PERS)
The 175 page PERS 2015 Financial Report is out. And it’s a doozy. You can read it here: PERS 2015 Comprehensive Financial Report. The good news is that they lowered the investment assumption from 8% to 7.75%. The bad news is that they don’t actually expect the fund’s investments to return anywhere close to 7.75%.… Continue Reading

Report Looks at Public Pension Investment Return Assumptions

Posted in Mississippi Public Employer's Retirement System (PERS)
This recent NASRA report looks at the investment return assumption of public retirement systems nationwide. Mississippi’s 8% investment return assumption is among the nation’s highest, although many other systems use this optimistic projection. Investment returns are hugely important for PERS because–as the report notes–investment returns account for an average of 62% of revenue. If investment… Continue Reading

PERS Investment Stupidity

Posted in Mississippi Public Employer's Retirement System (PERS)
Last week in this post I criticized the investment allocation for Mississippi PERS. In that post I noted that PERS is investing in foreign and junk bonds: The PERS 2014 financial report explains that the portfolio’s fixed income investments are a departure from the System’s previous U.S. investment grade only bond portfolio structure. The fund is… Continue Reading

You’re Going to Want to Keep Up with the Singing River Health System Debacle

Posted in General, Mississippi Public Employer's Retirement System (PERS)
Having been both busy at work and playing hurt for the last four weeks, I have not been able to study the ongoing Singing River Health System pension debacle enough to add anything to the conversation. But it has quickly become THE big legal story in Mississippi and promises to be for the foreseeable future.… Continue Reading

PERS Still Massively Underfunded Despite Stock Market Hitting All-Time Highs

Posted in Mississippi Public Employer's Retirement System (PERS)
Steve Wilson at Mississippi Watchdog recently wrote here about how Mississippi’s pension system ranks nationally. From the article: A new report by nonprofit State Budget Solutions says Mississippi’s Public Employees’ Retirement System of Mississippi is carrying $56 billion in unfunded liabilities, worst in the nation — now at 53 percent of the gross state product… Continue Reading

PERS Update: Future of Pension Funds is Bleak

Posted in Mississippi Public Employer's Retirement System (PERS)
Mish’s Global Economic Trend Analysis had this post on Friday about a report that concludes that 85% of pension funds will fail over the next three decades. From the post: Bridgewater Associates did an analysis of pension funds recently and concluded 85% of them will fail if returns average 4%.  Bridgewater notes that public pensions… Continue Reading

PERS Investment Returns Rebound- But PERS Still Underfunded

Posted in Mississippi Public Employer's Retirement System (PERS)
Jackson Jambalaya reported on November 5 about the latest development in Mississippi’s PERS time bomb. Here is the post, which uses charts that graphically depict how deep of a hole PERS is getting into. The good news is that the PERS investment return improved to 13.4%. The bad news is that despite the improved (and… Continue Reading

PERS Update: Illinois Can’t Fix PERS System Despite Nation’s Worst Funding Shortfall

Posted in Mississippi Public Employer's Retirement System (PERS)
The Walls Street Journal reported today on Illinois’ attempt to repair its nation’s worst state-pension crisis. The Illinois debacle is instructive on what a political hot potato state retirement system shortfalls are and how hard it will be to broker an agreement to fix Mississippi’s PERS system. The article states: A split has developed on… Continue Reading

WSJ Op-Ed: Pension Funds’ Expected Rate of Return = Biggest Lie in Global Finance

Posted in General, Mississippi Public Employer's Retirement System (PERS), Politics in Mississippi
Regular readers of this blog know about my prior criticisms of the expected rate of investment return assumption in the Mississippi Public Employees Retirement System. Here are my prior posts. A Wall Street Journal opinion by former hedge fund manager Andy Kessler calls pension funds’ (like PERS) investment return assumption a fantasy that will leave… Continue Reading

State Democrats vs. Math in PERS Debate

Posted in Mississippi Public Employer's Retirement System (PERS), Politics in Mississippi
Last week the Clarion-Ledger reported on Mississippi Democrats taking a hard line against any changes to the State’s Public Employee Retirement System (PERS). To be clear, the Democrats’ apparent strategy is not to challenge Republicans’ plans for modifications to PERS with a different plan. Instead, Democrats argue that PERS isn’t in trouble. The Democrats may… Continue Reading