Michigan Votes Forum

This bill is such a bad idea that it’s beyond comprehension that a Republican Senator could drink from this glass of cool aid.  Maybe it speaks to the complete lack of financial understanding displayed by our elected officials.  Here are the FACTS from the House Fiscal agency - the net annual cost to be between $501.7 million and $657.9 million - these costs are driven by the need to fund the added pension benefits AND amortize the unfunded accrued actuarial liabilities (UAAL).

Remember, the UAAL is over $30 Billion - add this years reported investment loss (and things have gotten worse since the report date of 9/30/2008) and you have UAAL of nearly $40 Billion.  Where does that money come from? It comes from local school operating  budgets - and the state is not increasing funding to schools (note the proposed proration and the annual 20j money grab).

Kill this bill or it will kill Michigan Schools.

 how about we let the unions provide the pension.

Wow!  Where is all this money coming from??  I thought we were cutting, cutting, cutting? 

 whatever gave you THAT idea???

granholm is still in charge. the're not cutting anything anytime soon.

The caption on this has a nice tabloid flair, don't your think?

That aside, and looking at the merits:  Read the legislative analysis of this bill, very carefully.

As the analysis states, if this bill were to pass, additional costs would immediately be incurred by local school districts, even if they did not in any way benefit from any supposed savings generated by employee retirements.  That is a bummer.

Further, why pay someone a large premium to retire if they are eligible and getting ready to retire anyway?  That simply doesn't make sense.

Getting a one-third boost in retirement pay would be a nice thing for Michigan school retirees.  But this is not the way to to do, nor is it the time to do it.  This bill should not pass.

mea teachers should get NO boost of retirement till the students learn.

pay for performance, not for cronyism.

 Yeah, I don't get it. The State's supposed to cut millions from higher education and it wants to cut their support of the Extension system by 50%.  They're laying off thousands of workers, but we're supposed to spend billions on asking people who are ready to retire, to retire...  Not that I'm surprised, but I'm sick of hearing the lies and watching them steal from taxpayers.

 it's what we get for letting the unions pick the politicians. any democrat who gets more than one third of his campaign funding from the unions is BOUGHT AND PAID FOR.

Oh my, whatever will wiitle cwazy do if this bill doesn't pass in the legislature?  What will become of cwazy's wittle song and dance?

Fact is, this bill has a huge downside for local school districts, and the state.  People who are genuinely interested in this kind of thing should skip past the tabloid caption that has been put on it here, and look at the various legislative analyses, to get a solid feel for the proposal's ramifications.

My opinion is that this legislation represents a bad idea on several points -- all cost related -- and should not pass. 

 This bill would add more costs to local school districts with no benefit.  The MEA is out of control.

Please don't forget that the sponsor of this bill is NOT a democrat.  THINK for a moment before you react and maybe wonder to yourself, why would a term-limited (R) want to support the MEA...?  ohhh... he's running for CONGRESS.

 Since each district pays a percentage of its budget to the retirement fund, this bill creates such a burden on districts tomorrow.  What is the current percentage up to now?  A few years ago it was nearing 20%.  That means that for an employee making $50,000, the district would pay an additional $10,000 into ORS out of the operating budget?  How is that fiscally responsible?  In ten years when all the "cheap" teachers have 10 years of experience and MAs, what percentage will the individual school districts pay then?

Or, is the state (taxpayer) planning on taking over school district pension liabilities? 

This legislation was introduced by Wayne Kuipers (R)?

I haven't been around for a while--could someone explain this?

 I think most folks do not realize that a percentage of the school's operating budget is going to fund pensions.  If it were put into concrete terms like 20% of the school operating budget goes to funding pension liability, many (not versed in MI school finance) would be outraged--especially if they have children or grandchildren in school.

This bill needs to die quickly, please.

Where is our pension????

When teachers do the job we pay them to, then they should get a pension.

I am sick and tired of hearing that the most important thing in the budget is education.

There are a lot of us, especially in Michigan suffering right now, and the LEAST concern we have is money spent

on education!!!!!!!!!!!!!!

 you obviously don't have a big enough, or corrupt enough union representing you.

What a timely idea.  This bill would do more to provide new jobs for Michigan residents and help the Michigan economy at a faster rate than anything in the federal economic stimulus bill.

 A better solution for getting more young teachers a job--push the K-3 classroom cap (house bill).

People are going to retire anyway.

The unfunded accrued actuarial liability is too great.

 wouldn't kicking out older, higher paid teachers in favor of younger, lower paid teachers be counter to the stated goals of the educational unions?

 I agree.  We keep graduates from our universities in Michigan.  New teachers get paid a lot less.  School districts save money by hiring young new teachers.  School districts have a greater cash flow to help them get through the tough current economic times.  Older teacher have an incentive to retire rather than staying around do to the uncertain economy.  This is a win win situation.  It is very similar to what our President is currently trying to do with our nation's economy.  I think this bill is a very creative solution to help school districts with current budget crunches.

The current economy is very unstable.  Many teachers that can retire will not because they are unsure of being able to support themselves on their current pension.  Many more people retire when they are given incentives.  The current incentive package that GM retires got was a lump sum amounting to $45,000 worth of incentives.  Michigan can not afford a large lump sum incentive like this right now in this economy.  However if you take the amount GM got that amounts to what a retiring teacher in this incentive plan would get over the next 7 1/2 years.  Our teachers spent a lot of time going to school to learn and than many years after that to teach our children.  Shouldn't our teachers be entitled to an incentive like GM workers for all they have done over the years to teach our children?

 The money will come from hiring new young teachers at the bottom of the pay scale giving each school district thousands of dollars in cash flow right now. 

 obviously the teacher's union has no problem putting SOME teachers out of work, while promoting OTHER teachers into their now vacant job slots. and the state of michigan has no problem with that either. i'm just glad i don't belong to the union that has to sell this one to it's rank and file. imagine what this is going to do to the amount of union dues collected monthly to elect more democrats.

why doesn't the state simply write a law that makes it illegal to give money to the unions. it would amount to an instant teacher payraise, and save the state billions yearly. imagine what it would do for the auto industry. this by itself would put a couple of billion dollars back into our economy.

I certainly wouldn't be retiring early today if I had a choice.

 What will the GM pension healthcare look like if GM goes bankrupt?  What will the pension look like?  Ask Pittsburg steal workers how much pension they received/now receive.  The US pension gaurantee fund doesn't cover the entire amount (and that's assuming there is enough in the fund).

Of course, pensions for MI government employees won't get covered by a federal fund if ORS winds up falling short--taxpayers will pick that up.

Now I'll be optimistic.  I think GM will be around in 20 years.

In 20 years we will all be driving around less in our battery powered cars that we get recharged at a battery changing station.

Electricity to recharge the batteries will come from the sky.

But,

I certainly wouldn't be retiring early today if I had a choice.

 I am one of those teachers that is waiting to see what happens.  If I retire this year it will save a young teacher in our district, if not it will be one more laid off.  I want to help the younger teachers but also need to protect my future.  Help us both out and save the district some money also.  Look at all possibilities - my district is struggling- and could use some help.  They cannot afford a buyout like others to encourage retirees.

Help the taxpayers out and accept the same benefits as State Employees.

Don't you think we non-government employees are hurting?

Many of us don't have health care coverage or a pension.

 i guess this is where you get to put your ideals on the line. is it more important to help out the younger teacher, or to protect your future? i thought teachers had a union so you didn't ever have to make this kind of decision. 

More government jobs?

Absolutely not! We need less government jobs, and less government. Government is the main reason Michigan and the U.S. economy is in such a mess, and they are taking taxpayers money to 'stimulate' us.

Now, if the bill COSTS millions to hire these young educators, then NO, the state shouldn't pass the bill. 

But, what you are saying is that if the bill SAVES money for the state by hiring $30,000/yr employees to replace $65,000/yr employees, they SHOULD or SHOULDN'T do it?

And, if the state SAVES money by doing this, why wouldn't you be in favor of it?  Explain why you don't want to SAVE the state money by hiring $30,000 people to replace $65,000 people?

 this bill creates no new jobs, it only retires out employees, at a cost to the government of whatever their retirement pay is, and replaces them with other employees. look at the total costs, not just the 'apparent savings'. your retirement payments will increase dramatically, while the 'apparent savings' will not offset the increase.

 What part of "budget deficit" is difficult for the MEA to understand?  These are the same people who are teaching Math!

Morons! 

This bill carries a net ANNUAL COST of $500 million to $660 million.  That's a net cost (savings minus expenses).  This data is from the non-partisan House Fiscal Agency!  There is no arguement about what happens if this bill moves forward - it will COST over 1/2 a billion annually!  These are facts not clouded by political mandates or partisan postions.  There is no agrument that Michigan cannot afford this type of irresponsible bill!  See the analysis for yourself here: http://www.scribd.com/doc/13322997/HB4285SB255-Cost-Impact

Then come back here and try to defend an indefensible position.

Uber.........    No one would be kicked out.  They would have a CHOICE of whether they wanted to accept the incentive or not. 

 jmd 364  ----------- Did you sign your letter "Morons" or are you calling someone a "moron"?

 just how much 'incentive' do you think the state will apply when the screws really tighten down? look at the BIG 3, they too used incentives to clear the high paid 'dead wood' from their payrolls. then they used layoffs when that didn't work. the unions fought for decades to get teachers higher pay, and now  they are sitting silently while highly paid teachers that they fought for are being 'incentive-ized' out of jobs, only to be replaced by lower paid teachers with no experience teaching.

the higher 'incentive' increases our day to day costs of paying for their retirement for as long as they are retired. this increase will not be offset by the supposed 'savings' of hiring fresh new know nothing teachers. i can see that the concern for the quality of education of our children is just shining through this bill.  

i can also see that all those years of paying union dues is really paying off for the higher paid teachers.

I'm not sitting on the economic model used by the Fiscal Agency - but I'm betting that there will still be a net cost to the system and here's why... The Pension system as it sits today lost $9.2 billion in asset value as of September 30, 2008 (see here).  That number is not included in the calcualtion of the funded ratio because the state has employed a "smoothing" calculation to minimize the impact of down years.  The problem with "smoothing" is that it's only effective for nominal losses and typically effective if the system only suffers a single down years.  That will not be the case for 2008 and 2009. 

The accrued actuarial deficit in the pension system, using the "smoothing" method, exceeds $30 billion. Add the current loss to the amount (as a proxy for estimating the impact of eliminating this accounting trick) and we approach a $40 billion pension deficit. Even amortized over 20 years that adds nearly $2 billion in year in extra payments - that equals an added cost (and additional funding requirement) of $1,234/student. Together with the current per student pension contribution of $981 and you have a cost of $2,215 per student or 30% of the $7,316/student foundation allowance.  Now, given that we are enrolling fewer studnets, and that means a need for fewer teachers, you componund the probem by adding more retirees on top of fewer supporting working teachers; a trend that has been accelerating for the last few years.

The system is broken, and adding new burdens to the system does not make econmic sense. Read the report for yourself...

 teaching and automaking compare exactly. both are unionized, both have been offered buyouts, both have debated buyouts, only one has resorted to layoffs YET. the only other difference between the two is the product they put out.

if you truly want to save money, allow 'bad kids' to be expelled sooner. get the obstacles to education out of the classroom. that will allow the teachers to teach more efficiently, to more eager students, and that will save the government money on 'nannying' the 'bad kids' all day. in the end we will be putting out a superior product. in the auto industry, if a part doesn't meet 'spec', it's rejected. let's hold our students to the same standards.

a little discipline won't hurt them. as for offering an incentive, wouldn't it just be cheaper to perhaps offer a pay cut if the teacher stays teaching, as opposed to retiring at current (not "boosted" or otherwise inflated) rates? you might discover that there are some teachers now willing to work for less. incentives cost money in the long run, but young teachers get payraises quickly. i don't see the two ending up as 'a wash'.