New lame duck threat looming for School Aid Fund
Senate leaders have now publicly stated they plan to pass damaging pension changes during lame duck, with hearings in that chamber starting Wednesday morning. It's urgent that all members mobilize around the issue - and stay on message about the huge costs these changes would mean for taxpayers.
According to the state's own budget experts, the plan to gut school employee pensions would cost taxpayers billions of extra dollars while providing a less secure retirement to new school employees - while threatening the solvency of the defined benefit system that active school employees and retirees rely on. Everyone has a stake in this fight.
SB 102 is scheduled for a 9 a.m. Wednesday hearing in the Senate Appropriations Committee. It would move all new school hires into a defined contribution, 401(k)-style retirement plan, even though the changes already made to the pension system in 2012 are working.
Experts in the Department of Technology, Management and Budget peg the increased costs at $1.2 billion next year alone - with a 30-year price tag of $24 billion.
The question we have to ask in phone calls, emails, and letters to lawmakers: Who will pay those enormous costs? Will taxes go up? Or will lawmakers slash school spending again? To cover that $1.2 billion first-year cost, funding would need to be cut $820 per pupil!
Also up for hearing are SBs 1177 and 1178 - bills that would spread out the state's pension costs over 50 years, instead of the current 22 years. This is an attempt to make the increased costs of closing the pension system appear smaller by spreading them out until 2067 - long after every current employee has retired and passing the buck on to future legislators and taxpayers.
Send an email to your State Senator and Representative with a personalized message through our Action Network page. If you want to call your lawmakers, look up your lawmakers' contact information here.
Such drastic "fixes" to the school employee pension system are not necessary, because recent changes are working. The hybrid system created in 2012 is fully funded, and investments are rebounding from the economic downturn of 2008.
For his part, Gov. Rick Snyder has been opposed to making further changes, and reaction in the House has been mixed. Your efforts matter-besides phone calls, emails, and letters to lawmakers, consider writing a letter to the editor of your local newspaper or getting involved in other efforts locally to get the word out. Look for ways to rally your MEA colleagues and bring parents, administrators, and business leaders into the fight!
It’s official -- Michigan’s new Speaker of the House, Rep. Tom Leonard (R-DeWitt), says one of his top priorities will be to come after educator pensions.
“1 of Speaker-elect Leonard’s top priorities – moving newly hired teachers to 401k instead of a pension. Snyder admin has been reluctant #mileg,” tweeted Associated Press reporter David Eggert (@DavidEggert00) Thursday afternoon.
Whether it happens in the abbreviated “lame duck” legislative session between now and mid-December, or lawmakers wait to take it up when a new Legislature is seated in January, MEA members need to begin mobilizing now.
That means educating yourself, colleagues, friends, and family of what’s happening and why what's being discussed is wrong for employees, retirees and the state. Read more about how the billionaire DeVos family is behind this latest attack on public school employees and the Michigan Public School Employees Retirement System (MPSERS).
Learn how the system was already reformed in 2012, how the current hybrid system is fully funded, and how shifting new employees to 401(k)-style pensions would cost the state hundreds of millions per year in closure costs, and more.