2024 Senate Bill 911

Retirement: public school employees; certain required annual contributions; modify.

A bill to amend 1980 PA 300, entitled “The public school employees retirement act of 1979,” by amending sections 41 and 43e (MCL 38.1341 and 38.1343e), section 41 as amended by 2023 PA 198 and section 43e as amended by 2012 PA 300.

Mackinac Center Analysis

The bill would reduce pension contributions into the school retirement system when the state has saved enough to prefund the costs of retiree healthcare benefits. Under current policy, the state will not put less into the retirement system until all the debts are prefunded. And while retiree health care benefits have now been fully prefunded, the state still owes pensioners $29.9 billion more than what has been saved. The $670 million that had been used to prefund retiree health care benefits would be moved to paying down pension debts.

The bill would allow the state to take the $670 million and spend it on other priorities.

The state accidentally made school employees the state’s largest creditors by promising pension benefits and not setting aside enough money to pay for them. Lawmakers have been trying to pay down those debts and prevent itself from going further into pension debt. The bill would delay debts from being paid down and cost taxpayers $1.4 billion due to additional interest costs.

Introduced in the Senate

June 12, 2024

Introduced by Sen. Kevin Hertel (D-12)

Referred to the Committee on Appropriations

June 20, 2024

Discharged from committee

Referred to the Committee of the Whole

Reported with substitute S-1

Substitute S-1 concurred in by voice vote

Passed in the Senate 20 to 17 (details)

Received in the House

June 25, 2024

Referred to the Committee on Appropriations

June 26, 2024

Discharged from committee

June 27, 2024

Substitute H-3 offered by Rep. Matt Koleszar (D-22)

The substitute passed by voice vote

Passed in the House 56 to 54 (details)

Motion to give immediate effect by Rep. Abraham Aiyash (D-9)

The motion prevailed by voice vote