Executive Director’s Blog Post – MPSERS reform package dead in lame duck but debate is far from over

I am writing to inform you that due to your efforts, and the efforts of other supporters of the Michigan Public Schools Employees Retirement System, the Senate today has decided not to vote on Senate Bills 102, 1177 & 1178 during the remainder of the current legislative session!

The decision to back away would not have happened without your strong efforts to oppose this legislation. Of particular note, many members of the Senate were concerned about the transition costs to close out the system ($25 – $33 billion of additional costs) that would have to be paid by the taxpayers of Michigan. Additionally, there was concern that these bills were rushed to the floor and that the reforms instituted in 2012 were working and rapidly reducing the unfunded liability.

Let me offer my thanks and congratulations for “dodging this bullet” and I hope your holidays are a bit less stressful as a result.

Now for the other side of this coin: I fully expect these bills will be offered almost immediately in the Senate and House when the new legislative session begins. I also expect a strong effort will be made to increase the costs you will be responsible to pay for your health care. Whether that is in the form of increased monthly premiums, substantially higher out-of-pocket expenses or reduction in coverage is yet to be determined but, in any event, be prepared for a renewed effort to reduce your benefits.

Taking appropriate steps to head off the next round of these efforts is critical to our success. First and foremost, do not become complacent. For every argument we have put forward, there will be an effort to undermine each point. Stay committed to the financial implications of closing out the MPSERS plan. The transition costs are real and the State cannot afford to close out the system. It is, simply put, very bad fiscal policy for the taxpayers of the State of Michigan.

In fact, the 2012 reforms have reduced the unfunded liability in the system by over $12 billion. This includes pre-funding of health care costs that previously had not been set aside. The bottom line is the reforms are working extremely well and there is no solid reasoning for moving to close the system.

Please continue your efforts to engage with your Senators and Representatives. Thank those who have opposed these bills and express your concerns with those who have yet to make a public comment on them.

The last and possibly most important action you can take is to ask public school retirees or active employees to join MARSP. Nothing speaks louder to elected officials than the power of the vote. Increasing our membership (currently just over 40, 000 members) will exponentially expand our ability to influence critical legislation. Getting a friend, spouse or someone you just met who worked in public schools to join MARSP is the best way to support our mission: Protecting your future.

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