MEA - Retired
Supreme Court hears state workers' challenge to RTW
This week, the Michigan Supreme Court heard the first arguments challenging right-to-work since the law went into effect in 2013.
The Court will decide whether the law applies to 35,000 state workers. The lawsuit was brought by the United Auto Workers and claims that the law violates the constitutional autonomy of Michigan's Civil Service Commission. That body negotiates compensation and conditions of employment for state workers.
The state is arguing that the Legislature-not the Commission-has power over the conditions of employment for state workers. Previously, the Michigan Court of Appeals sided with the state. Only the Michigan State Police and firefighters are currently exempt from the law.
Early 2015 Planning on Defined Contribution Initiatives
Chuck Agerstrand, MEA-Retired
MEA along with our coalition partners within the Coalition of Secure Retirement (CSR’s) goal in January and February includes meeting with key players in the Legislature. The list targets newly elected legislators, Senate Appropriations Committee members and the Governor’s office & staff. We also plan to coordinate a meeting with the Department of Technology, Management and Budget to discuss the up-front costs that a switch to a defined contribution plan would create for the Michigan Public School Employees Retirement System. As a point of information the CSR along with MEA supports the Governor’s efforts to prefund retiree healthcare and increase state contributions to the MPSERS system. CSR’s long-term goals include a Day at the Capitol for CSR retiree members, continued grass roots development and a new research project focused on examining the health of state employee DC plans after that system was converted in 1997.
Considering Returning to Work? Know the Law!
Have you ever considered returning to work at a public or charter school as a part time or contract employee? Before you enter into any agreement to return to work after retirement, be sure to carefully consider the law regarding this. Recently, a retired school psychologist returned to work with a private agency working at a charter school during the 2010-2011 school year. He earned $5,000 for his work, but now he must pay back the retirement system $34,000 to cover the pension and health benefits he received during this period. Any retiree who is considering returning to work for a public school or charter school as a part time employee needs to be aware of the strict rules Read more about this case recently posted in a Detroit News article by clicking here. Please go to the MPSERS Info tab on our website for more detailed information (see MPSERS “After You Retire and Retiree Earning Limitations.”
Lame Duck Wrap-Up
December 19, 2014 Chuck Agerstrand MEA
Early Friday morning, the legislature completed work on a package of legislation that would raise over $1 billion for transportation infrastructure. In addition, the package would raise $300 million in new revenues for public education and nearly $100 million for local governments. All of the changes will be placed on a statewide ballot question in May of 2015. If voters reject the plan, only the legislation regarding internet sales tax (known as the Main Street Fairness Plan) will remain in place. The plan is made up of the following parts:
* The sales tax on gasoline will be eliminated (tax reduction of approx. $700 million)
* Michigan sales tax would be increased from 6 to 7% (tax increase of $1.34 billion)
* Increased driver registration fees and overweight truck fees (tax increase of $95 million)
* ‘Main Street Fairness’ legislation included in plan: companies with a ‘nexus’ in Michigan must collect sales tax revenue for online sales (tax increase of $40 million)
* Earned Income Tax Credit would be restored to 20% of the federal level (tax reduction of $260 million)
* Transform current per gallon motor fuel tax to a wholesale tax and increase the rate to raise $1.2 billion for transportation infrastructure
When factoring in the various tax increases and tax reductions, the plan would raise overall revenues by approximately $1.8 billion. The new money, when fully phased in, would primarily be divided between roads and bridges ($1.3 billion); public education ($300 million); local government ($94 million); and public transportation ($112 million). Other pieces of the agreement include:
* The School Aid Fund will be used only for k-12 and community colleges, not universities. This reverses a trend started several years ago where up to $200 million was removed from the SAF to pay for university operations. Commitments were made by the governor and legislative leaders to restore the lost funds for universities through the general fund
* The creation of a study to examine the true cost of education with the goal of providing a better indication of k-12 spending needs
While the House and Senate have been debating a final road package for weeks, in the end the ballot proposal passed overwhelmingly in the House but barely made it through the Senate. Many Senators expressed concern that voters may shy away from such a complicated proposal. Over the next few months backers and detractors of the plan will have the opportunity to sway voters one way or the other.
Religious Freedom Restoration Act Dies
Earlier last week, the House passed HB 5958- the Religious Freedom Restoration Act (RFRA). As the last day of lame duck session approached, several Senators signed a letter urging Majority Leader Randy Richardville (R-Monroe) to take up the house passed version of the bill after he had told local media he felt there was no ‘fervor’ in his chamber for the issue. The letter was signed by the letter’s author Senator Tom Casperson (R-Escanaba), Senate Minority Floor Leader Tupac Hunter (D-Detroit), and 13 other Republicans.
House Bill 5958, sponsored by Speaker Jase Bolger (R-Marshall), would limit Michigan government’s ability to infringe on one’s “sincerely held religious beliefs.” Opponents of the bill, several of whom protested outside of the state capitol building this week, believe that the bill is essentially a license to discriminate, and will violate the civil rights of gay individuals, women, and others. Supporting the bill, Ari Adler, spokesperson for Speaker Bolger, maintained that that it only requires that state or local government have sufficient justification for its action when infringing on someone’s religious beliefs. The bill failed to move before the end of lame duck.
Medical Marijuana Legislation Goes Up in Smoke
Legislation that deals with Michigan’s medical marijuana dispensaries was recently discharged from Senate committee after lying dormant for months. Michigan law enforcement held a press conference this week to voice their strong concerns with the legislation. The Michigan Sheriffs Association, the Michigan Chiefs were joined by the Michigan Association for Local Public Health, who announced that they had formed a list of 19 new issues with the latest version of House Bill 4271. One of the main components of the bill is to allow state-issued medical marijuana growers, or caretakers, to sell their excess marijuana. Law enforcement has a major issue with the financial incentive aspect of the bill, and sees this as a loophole, with nothing stopping authorized growers from selling 100% of their marijuana, rather than using any for themselves. The issue was ultimately not taken up.
Education Reforms Fail to Pass
Bills aimed at making numerous different reforms to public education were left behind as the legislature adjourned for the year. These included bills to require mandatory repetition of third grade for students who fail standardized reading tests; expand the Education Achievement Authority; convert public school pension system (MPSERS) to a defined contribution scheme; require letter grading of public schools; and create an “early warning” system for schools in financial distress that would have placed hundreds of school districts on an accelerated path to an emergency financial manager. Many of these bills passed one chamber or the other but House and Senate leaders were unsuccessful in reaching an agreement before the end of the 2014 session. Public school employee organizations were generally happy to see these bills die.
PROTECT OUR PENSIONS!
From our friends at AFT Michigan
Currently, the Michigan Senate is considering a package of bills aimed at making significant changes to the Michigan Public School Employee Retirement System. Senate Bills 722-728 would shift newly-hired public school employees into a defined contribution pension system. The bills would also eliminate future duty disability retirements and prohibit the purchase of service credits.
The proponents of the bills claim that the shift will save schools money while continuing to provide an adequate retirement plan for school employees. However, recent studies have shown that both these assertions are dubious at best. First, closing a defined benefit plan to new hires will end future contributions into that system - thereby requiring additional immediate funds to ensure that the existing unfunded accrued liability can be paid off. Second, comparisons of defined benefit to defined contribution plans have shown that the employer must make a much larger contribution into a defined contribution plan to provide the same level of benefits received from a defined benefit system.
These bills would likely end up costing the state millions in immediate required spending while diminishing future pension benefits for all newly hired public school employees.
We have made it easy to send an email message to your state senator. To use this feature please click on the link at the bottom of this post. This will cause the Member Login section of the website to open. Directions for sending an email message follow:
To send an email message you must login using your credentials. (User name = first letter of your first name + your last name, Password = the last 4 digits of your social security number). Click on the box next to your senator’s name and either modify the email message or simply click submit to send the pre-written message.
To contact your state senator, click here.
Senator Jansen's staff testifies - "MPSERS on Edge of Disaster"
Posted with permission from the AFT Retiree Network
On November 13, the Senate Appropriations Subcommittee on General Government brought in officials from the Office of Retirement Services to answer questions about a recent MPSERS audit. Phil Stoddard testified that the audit had found no material weaknesses in the MPSERS system. However, staff persons from Senator Jansen's office highlighted four reportable conditions contained in the audit and used that as a basis to attack the health of the entire MPSERS system.
Mr. Stoddard reported to the committee that investment returns for MPSERS have been in the 94th percentile nationally over the past four years. He said that unfunded liabilities have been shrinking overall, and the relatively new hybrid plan is 105% funded. Mr. Stoddard stated that ORS runs one of the most sophisticated retirement systems in the country.
After Mr. Stoddard concluded his testimony, Deborah Drick and Mike Maloney from Senator Jansen's staff testified before the committee. They claimed that the MPSERS system is in fact teetering on the edge of disaster. They stated that the assumed rate of return in wildly overblown, and that the plans are woefully underfunded. Their opinion of the performance audit differed substantially from that of ORS, and they claimed that the audit paints a picture of denial and political expedience.
Mr. Maloney testified to the committee that the actuarial assumptions in the MPSERS plan are completely wrong. He stated that the mortality rate is wrong, the assumed rate of return is too high, and that the system is on the brink of collapse.
Committee Chair John Pappageorge (R-Troy) suggested that persons with such wildly different opinions as to the accuracy of the rate of return assumptions should try to come to some agreement on an accurate number. This issue will continue to receive legislative attention as the Senate examines Senator Jansen's proposed legislative package in December
Understanding your Annual Wellness Visit
Visiting your doctor for an annual wellness visit is one of the best ways to stay on top of your health and catch issues early. If you haven't yet visited your doctor for your wellness visit this year, here's what you should know before you go:
What is an annual wellness visit?
An annual wellness visit is a preventive visit to your doctor once per year. During this visit, your doctor will check for potential health issues and suggest ways you can improve your health.
What should I bring with me?
To help your doctor determine your health needs, bring a list of the medications you take and the names of any other doctors you see, as well as a list of any family health issues.
What should I expect during my visit?
During your visit, your doctor will ask you questions about your personal and family health history. Your doctor will also measure your height, weight, body mass index, and blood pressure. Your doctor will use this information to create a preventive care plan for you.
The visit is covered once a year at 100 percent and includes your height, weight, body mass index, and blood pressure measurements. However, if your doctor recommends additional screenings or tests, you may have to pay coinsurance for these services. To view a list of covered preventive services, check your Evidence of Coverage at www.bcbsm.com/mpsers. (BCBS Fall 2014 Best of Health)
Have you noticed the recent changes to our website? We have made several changes which improve the navigation and functionality of the website.
You will notice that one of the major changes can be seen in the navigation bar on the left side of the home page. The items listed here (buttons) are the gateway into the main information in the website. Some of these buttons contain side arrows which indicate additional information that can be accessed via these buttons. (See “About Us,” “Leadership,” etc.). You will notice that when you “hover over” one of these buttons, sub-menus pop out to the right. This makes it easier to get to more detailed information.
Member Only Section (Member Login)
We have made several changes in this area too. Once you have logged into the system you will notice the message at the bottom of the page, which clearly indicates that you must click on the “Submit” button to enter into this area. Once you click on “submit,” following a brief pause, our website reopens. Now for the major changes. Please note that some of the navigation buttons on the left are highlighted with a change in color and have a red border around them. This highlighted buttons indicates that it contains additional information available for members only, not for the general public. Some new navigational buttons also appear at the bottom of the navigation bar on the left. We would encourage members to explore this area of the website.
Member Login Reminder
Members can login with these credentials:
Username: (first letter of your first name + last name Tom Smith = tsmith
Password: (last four digits of your Social Security Number)