Mississippi lawmakers have been working to reshape controversial changes made to the public employees’ retirement system a year ago.
Last year, as part of legislation to phase out the state income tax, lawmakers made some changes to PERS — including a provision placing individuals hired after March 1 of this year into a new tier where they would be required to work for the state for 35 years before drawing benefits. This provision drew backlash from multiple groups, most notably first responders, who argued that recruitment efforts would be stifled drastically.
Accounting for these concerns, both legislative chambers, in a roundabout way, reached a compromise on a plan to alter PERS. On Sunday, the House of Representatives and Senate nearly unanimously adopted a conference report that checked multiple priority boxes. This followed multiple failed attempts within the 2026 session to address PERS.
Notably, lawmakers agreed to return the required time of employment before drawing benefits to 30 years. Another change, one that was supported by both House Speaker Jason White and Lt. Gov. Delbert Hosemann, would allow retirees to return to the workforce sooner, with the separation period dropping from 90 days to 30 days. This is expected to play a meaningful role in boosting the number of teachers in public schools amid a shortage.
Lawmakers also created the Mississippi Work and Save Administrative Fund, a voluntary state-sponsored payroll-deduction retirement savings program for employees of employers that do not already have a specified tax‑favored retirement plan.
A proposal that was not included in the adopted legislation was one offered by the Senate that would make a significant cash contribution to PERS, which has an unfunded liability of roughly $26 billion. The Senate had previously proposed that the state pay $1 billion into the system over the next 11 years. That plan was ditched in conference, though legislative leadership has expressed an appetite to put money into PERS.
The PERS changes have been sent to the desk of Gov. Tate Reeves, and if signed into law, will go into effect on July 1.