Superivisors proceed to repay missing funds for hospital employees’ retirement

Published 12:09 am Tuesday, November 8, 2016


NATCHEZ — Adams County Board of Supervisors attorney Scott Slover projects within two weeks, former Natchez Regional Medical Center employees should be able to receive full retirement benefits.

On Monday supervisors elected to proceed with paying the Mississippi Public Employee Retirement System for payments missed by Natchez Regional officials two years ago.

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Slover said $310,000 in funding is from a bankruptcy escrow account closing in mid October. Supervisors had earmarked for those funds for paying PERS. Slover said the total owed to PERS would be $448,160.38.

Board President Mike Lazarus said the $138,160.38 would come out of the general fund and cash balances.

The board considered making the payment in January, when property tax revenues are received, but opted to pay it within the next week to more quickly make retirees whole again.

“It would do the county worlds of good to wait until January,” he said. “We are not taking out a tax anticipation loan.

“We can pay it and make everything work. Departments will just have to be careful and hang tight until January.”

The $138,160.38 payment is part of approximately $200,000 the supervisors saved by refinancing the $3 million loan taken out to keep the hospital operational two years ago.

While employees continued to make contributions toward PERS, from November 2013 until the bankruptcy filing the hospital did not pay the employer portion of the payments. Under PERS, employers make a 15.75-percent match to employee contributions.

In May 2016, Gov. Phil Bryant signed a bill into law to allow Adams County to buy out the PERS claim from the bankruptcy.

PERS has not allowed people to accept a partial payment on outstanding funds during this time period even though employees paid their portion of the benefits.

The former county-owned hospital filed for bankruptcy protection in March 2014, after losing millions of dollars. The bankruptcy ended in October 2014 when the hospital was sold to Community Health Systems for $10 million.

During the sales process, an escrow account of $4 million was created to cover any remaining clawbacks from Medicaid and Medicare. Administrative claims, secured creditors and unsecured creditors will also have access to the account.

PERS is one of the creditors and Slover said has entered a claim of approximately $500,000 for reimbursement.

If PERS is reimbursed, Slover said the county could receive up to the entirety of the claim, as the county is agreeing to purchase this debt.

Slover said it is highly unlikely for a creditor to receive its full claim during bankruptcy.