MISSISSIPPI LEGISLATURE

1999 Regular Session

To: Appropriations

By: Representative Manning

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 25-15-15, Mississippi Code of 1972, is amended as follows:

25-15-15. (1) * * * The state shall provide fifty percent (50%) of the cost of the above life insurance plan and one hundred percent (100%) of the cost of the above health insurance plan for all active full-time employees, and the employees shall be given the opportunity to purchase coverage for their eligible dependents * * *. The premiums for such dependent coverage and the employee's * * * share of the premiums for his life insurance coverage shall be deducted from the employee's salary by the employing agency, department or institution * * *, which deductions, together with the * * * share of * * * life insurance premiums of such employing agency, department or institution * * * from funds appropriated to or authorized to be expended by such employing agency, department or institution * * *, shall be deposited directly into a depository bank or special fund in the State Treasury, as determined by the department. These funds and interest earned on these funds may be used for the disbursement of claims and shall be exempt from the appropriation process.

(2) The department * * * may establish and enforce late charges and interest penalties or other penalties for the purpose of requiring the prompt payment of all premiums for life and health insurance permitted under this article. All funds in excess of the amount needed for disbursement of claims shall be deposited in a special fund in the State Treasury to be known as the State Employees Insurance Fund. The State Treasurer shall invest all funds in the State Employees Insurance Fund and all interest earned shall be credited to the State Employees Insurance Fund. Such funds shall be placed with one or more depositories of the state and invested on the first day such funds are available for investment in certificates of deposit, repurchase agreements or in United States Treasury bills or as otherwise authorized by law for the investment of Public Employees' Retirement System funds, as long as such investment is made from competitive offering and at the highest and best market rate obtainable consistent with any available investment alternatives; however, such investments shall not be made in shares of stock, common or preferred, or in any other investments which would mature more than one (1) year from the date of investment. The department shall have the authority to draw from this fund periodically such funds as are necessary to operate the self-insurance plan or to pay to the insurance carrier the cost of operation of this plan. It is the purpose of this section to limit the amount of participation by the state to fifty percent (50%) of the cost of the life insurance program for active full-time employees and not to limit the contracting for additional benefits where the cost will be paid in full by the employee. The state shall not share in the cost of * * * coverage for retired employees except as provided in subsection (4) of this section.

(3) The department shall also provide for the creation of an Insurance Reserve Fund and funds therein shall be invested by the State Treasurer with all interest earned credited to the State Employees Insurance Fund.

(4) The full cost of the premiums for the health insurance plan for retired employees shall be paid from funds in the Public employees' Retirement System, or from funds in the Mississippi Highway Safety Patrol Retirement System in the case of retired members of the Mississippi Highway Safety Patrol. The Public employees' Retirement System and the Highway Safety Patrol Retirement System shall pay to the department on a monthly basis the amount of the premiums as determined by the department.

(5) Any retired employee electing to purchase retired life * * * insurance shall have the full cost of such insurance * * * deducted monthly from his * * * retirement * * * check or shall be directly billed for the cost of the premiums. 

SECTION 2. Section 25-15-256, Mississippi Code of 1972, is amended as follows:

25-15-256. The state shall provide annually, by line item in the Mississippi Library Commission appropriation bill, such funds to pay one hundred percent (100%) of the cost of insurance under the Public School Employees Health Insurance Plan created under Article 7, Chapter 15, Title 25, Mississippi Code of 1972, for all full-time library staff members in each public library in Mississippi. The commission shall allot to each public library a sufficient amount of those funds appropriated to pay the costs of insurance for eligible employees. Any funds so appropriated by line item which are not expended during the fiscal year for which such funds were appropriated shall be carried forward for the same purposes during the next succeeding fiscal year. If any premiums for health insurance and/or late charges and interest penalties are not paid by a public library in a timely manner, as defined by the department, the Mississippi Library Commission, upon notice by the department, shall immediately withhold all subsequent disbursements of funds to that public library.

Any local contribution to the cost of insurance paid by a public library for eligible employees during the fiscal year immediately preceding July 1, 1994, shall be converted into salary supplements or fringe benefits distributed among all full-time employees of the library.

The full cost of the premiums for the health insurance plan for retired library staff members who are members of the public employees' Retirement System shall be paid from funds in the Public Employees' Retirement System. The Public Employees' Retirement System shall pay to the department on a monthly basis the amount of the premiums as determined by the department.

SECTION 3. Section 25-15-261, Mississippi Code of 1972, is amended as follows:

25-15-261. (1) Each eligible employee may participate in the program by signing up for the plan at the time of employment. Each eligible employee who declines coverage under the plan must sign a waiver of coverage. After acceptance in the plan, the employee may cease his or her participation by filing a specific disclaimer with the department. Forms for this purpose shall be prescribed and issued by the department. All eligible employees will be eligible to participate in this self-insured plan on the effective date of the plan or on the date on which they are employed by the school district, if later, provided they make any necessary contributions as set out hereunder. Prior to the initial enrollment cutoff date for the plan, all participating employees who are currently covered under the Public School Employees Health Insurance Plan or under a group health plan sponsored by any participating school district or community/junior college district shall be eligible for full benefits under this plan on the first day of his or her participation regardless of any preexisting health condition or injury. All other participating employees shall have coverage of preexisting illness within one (1) year after enrollment in the plan. Spouses of employees, unmarried dependent children from birth to age nineteen (19) years, unmarried dependent children who are full-time students up to age twenty-three (23) years, and physically or mentally handicapped children, regardless of age, are eligible under this plan as of the date the employee becomes eligible.

If both spouses are eligible employees who participate in the plan, the benefits shall apply individually to each spouse by virtue of his or her participation in the plan. If those spouses also have one or more eligible dependents participating in the plan, the cost of their dependents shall be calculated at

a special family plan rate. The cost for participation by the dependents shall be paid by the spouse who elects to carry such dependents under his or her coverage. The special family plan rate shall apply also if the public school, community/junior college district or public library employee's spouse is a covered eligible employee under the State Employees Health Insurance Plan.

(2) The state shall annually provide one hundred percent (100%) of the cost of the above insurance plan for all district employees who work no less than twenty (20) hours during each week and regular nonstudent school bus drivers. Where federal funding is allowable to defray, in full or in part, the cost of participation in the program by district employees who work no less than twenty (20) hours during each week and regular nonstudent school bus drivers, whose salaries are paid, in full or in part, by federal funds, the allowance under this section shall be reduced to the extent of such federal funding. Where the use of federal funds is allowable but not available, it is the intent of the Legislature that school districts contribute the cost of participation for such employees from local funds, except that parent fees for child nutrition programs shall not be increased to cover such cost.

Any local contribution to the cost of insurance paid by the school district during the fiscal year immediately preceding July 1, 1994, shall be converted into salary supplements or fringe benefits in that school district for certificated employees and teacher assistants. Any local contribution to the cost of insurance paid by the school district for noncertificated employees during the fiscal year immediately preceding July 1, 1994, shall be converted into salary supplements or fringe benefits in that school district.

(3) The state shall provide annually, by line item in the community/junior college appropriation bill, such funds to pay one hundred percent (100%) of the cost of the plan for all community/junior college district employees who work no less than twenty (20) hours during each week.

Where the use of federal funding is allowable to defray, in full or in part, the cost of participation in the insurance plan by community/junior college district employees who work no less than twenty (20) hours during each week, whose salaries are paid, in full or in part, by federal funds, the allowance under this section shall be reduced to the extent of the federal funding. Where the use of federal funds is allowable but not available, it is the intent of the Legislature that community/junior college districts contribute the cost of participation for such employees from local funds.

Any community/junior college district may contribute to the cost of coverage for any district employee from local community/junior college district funds, and any public school district may contribute to the cost of coverage for any district employee from nonminimum program funds. Any part of the cost of such coverage for participating employees of public school districts and public community/junior college districts that is not paid by the state or by the districts shall be paid by the participating employees, which shall be deducted from the salaries of the employees in a manner determined by the department.

Any funds appropriated for the cost of insurance by line item in the community/junior colleges appropriation bill which are not expended during the fiscal year for which such funds were appropriated shall be carried forward for the same purposes during the next succeeding fiscal year.

Any local contribution to the cost of insurance paid by a community/junior college district for eligible employees during the fiscal year immediately preceding July 1, 1994, shall be converted into salary supplements or fringe benefits distributed among all full-time employees of the district.

(4) The state shall not share in the cost of coverage for retired employees except as follows: The full cost of the premiums for the health insurance plan for retired employees who are members of the Public Employees' Retirement System shall be paid from funds in the Public Employees' Retirement System. The Public Employees' Retirement System shall pay to the department on a monthly basis the amount of the premiums as determined by the department.

SECTION 4. Section 25-11-101, Mississippi Code of 1972, is amended 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. Among the other benefits provided by the retirement system is the payment of the cost of the premiums for the State Employees Health Insurance Plan and the Public School Employees Health Insurance Plan for retired members of the retirement system who are participating in those plans. The retirement system provided by Article 3 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 5. Section 25-11-123, Mississippi Code of 1972, is amended 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, 1991, the employer shall cause to be deducted from the salary of each member on each and every payroll of such employer for each and every payroll period seven and one-fourth percent (7-1/4%) 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; provided, however, that 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 herein shall be made notwithstanding that the minimum compensation provided by law for any member shall be reduced thereby. Every member shall be deemed to consent and agree to the deductions made and provided for herein and shall receipt for his full salary or compensation, and payment of salary or compensation less said deduction shall be a full and complete discharge and acquittance of all claims and demands whatsoever for the services rendered by such person during the period covered by such 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 such 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%). 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 prior to 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 shall be 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 such 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 such 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 such 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.

(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. Provided, however, that notwithstanding the provisions of Sections 25-11-15(10) and 25-11-105(f)(5)e, 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 such 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 shall designate, 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 such receipts, shall deposit such amounts as provided by law.

(f) 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 percentage rate of such 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. Notwithstanding any other provision of law, the county board of education, the governing authorities of separate, consolidated, or municipal school districts, and all other such boards set up by law which handle and disburse school funds, shall pay from local tax sources one and one-half percent (1-1/2%) of the total employer's contribution rate of nine and three-fourths percent (9-3/4%).

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 shall designate, 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 said 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.

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.

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. 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 6. Section 25-13-1, Mississippi Code of 1972, is amended as follows:

25-13-1. There is hereby established a retirement system for the Mississippi Highway Safety Patrol, as defined in this chapter, effective July 1, 1958, under which members of the Mississippi Highway Safety Patrol may retire for superannuation or may retire for reason of disability, and providing benefits to widows and orphans of such patrolmen. This retirement system is designed to supplement and is in addition to the provisions of Sections 25-11-1 to 25-11-21. Under the terms of this chapter, the highway safety patrolmen, as defined herein, retain all the benefits of old age and survivors insurance under the federal laws administered by the Department of Public Health, Education and Welfare, or its successor, as provided in the federal and state agreement executed on July 2, 1952, but shall not be eligible for benefits under Sections 25-11-101 to 25-11-139, which is the state retirement annuity plan for state employees. Another benefit provided by the retirement system is the payment of the cost of the premiums for the State Employees Health Insurance Plan for retired members of the retirement system who are participating in the plan. This chapter is a substitute for and in lieu of said sections, and is designed to provide more liberal benefits for the highway safety patrolmen by reason of the dangerous nature of their employment.

SECTION 7. Section 25-15-3, Mississippi Code of 1972, is amended as follows:

25-15-3. For the purposes of this article, the words and phrases used herein shall have the following meanings:

(a) "Employee" means any person who works full time for the State Mississippi and receives his compensation in a direct payment from a department, agency or institution of the state government. This term includes legislators, employees of the legislative branch and the judicial branch of the state, * * * full-time salaried judges and full-time district attorneys and their staff and full-time compulsory school attendance officers. For the purposes of this article, any "employee" making contributions to the Public Employees' Retirement System or the Mississippi Highway Safety Patrol Retirement System shall be considered a full-time employee.

(b) "Department" means the Department of Finance and Administration.

(c) "Plan" means the State Employees Life and Health Insurance Plan created under this article.

(d) "Fund" means the State Employees Insurance Fund set up under this article.

(e) "Retired employee" means any person who is retired under the Public Employees' Retirement System or the Mississippi Highway Safety Patrol Retirement System and is receiving a retirement allowance from such system.

SECTION 8. Section 25-15-251, Mississippi Code of 1972, is amended as follows:

25-15-251. For the purposes of this article, the words and phrases used herein shall have the following meanings:

(a) "Employee" means a person who works full time for any school district, community/junior college, public library or university-based program authorized under Section 37-23-31 for deaf, aphasic and emotionally disturbed children, or any regular nonstudent school bus driver.

(b) "Department" means the Mississippi Department of Finance and Administration.

(c) "Plan" means the Public School Employees Health Insurance Plan created under this article.

(d) "Retired employee" means any retired employee as defined in this section who is enrolled on April 12, 1991, in a group health insurance plan offered by the individual school district or community/junior college district, and those active employees who may subsequently retire from employment after April 12, 1991.

SECTION 9. This act shall take effect and be in force from and after July 1, 1999.