MEA - Retired
Legislature OKs shifting money from School Aid to pay down budget deficit
The Michigan House and Senate passed two bills that balance the 2014-15 budget through fund shifts and cuts to state agencies. HB 4110 covers K-12, community colleges and higher education and calls for shifting money from the School Aid Fund to the General Fund. HB 4112 cuts money from state agencies and departments. Both bills are now on their way to the Governor for his signature.
HB 4110 replaces $250.3 million in the General Fund with School Aid revenue. A shift of $167.1 million from the School Aid Fund is allocated for community colleges.
The House and Senate Fiscal agencies provide a full analysis of the cost shifts and the impact on the School Aid Fund.
Both bills are meant to deal with a $325 million projected shortfall in the General Fund.
Contact Gov. Snyder and tell him to veto HB 4110
HB 4059 Introduced in the Michigan House
HB 4059, introduced by Rep Hughes would amend the Public School Employees Retirement Act to allow retirees to retain their retirement allowances and health benefit subsidy while providing certain services to schools in an identified critical shortage discipline or as a substitute teacher, instructional coach, or school improvement facilitator.
Previously, Public Act (PA) 464 of 2012 (House Bill 5261) amended the Act to allow retirees to retain their retirement benefits while providing services in each of the circumstances described below; however, that bill sunset each of the provisions as of July 1, 2014. House Bill 4059 would delete the sunsets, thus restoring the PA 464 provisions. Please Email your legislator by
Currently, the Act reduces either pension or retiree health benefits or both while a Michigan Public School Employees' Retirement System (MPSERS) retiree returns to work in a reporting unit, with varying reductions depending on the retirement date and the circumstances of the new employment. Under the Act, the term "reporting unit" means a public school district, intermediate school district, public school academy, tax-supported community or junior college or university, or an agency having employees on its payroll who are members of the retirement system.
One of the features of this legislation is that the bill would exempt from the current retiree benefit reductions, a retiree employed by a reporting unit that has a situation that necessitates the hiring of a retiree in an area designated as a critical shortage discipline. The Act currently requires the State Superintendent of Public Instruction to compile and annually update a list ob critical shortage disciplines.
The critical shortage provision would apply under the following circumstances:
- The retiree has been retired for at least 12 months before being reemployed.
- The retiree is employed for no more than a total of 3 years.
- The retiree is not eligible to use any of the service or compensation earned for a recomputation of his or her pension.
- The reporting unit pays to the MPSERS system 100% of the contribution rate for the unfunded actuarial accrued liability (UAAL) for the pension and for the UAAL for retiree health care.
Substitute Teachers, Instructional Coaches, and School Improvement Facilitators
It’s important to note that this bill would also exempt, from the current benefit reductions, a retiree retired after July 1, 2010 who subsequently is employed by or works in a reporting unit as a substitute teacher, instructional coach, or school improvement facilitator. This provision would apply under the following circumstances:
- The retiree has been retired for at least 1 month before being reemployed.
- The retiree earns no more than 1/3 of his or her final average compensation in a calendar year.
- The retiree is not eligible to use any of the service or compensation earned for a recomputation of the pension.
- The reporting unit pays to the MPSERS system 100% of the contribution rate for the UAAL for the pension and for the UAAL for retiree health care. (The Act requires that a reporting unit provide the Department of Technology, Management, and Budget - Office of Retirement Services quarterly with the names and total compensation paid under this provision. If the retiree works through a third party, the Act requires the reporting unit to obtain from the third party a list of all the retirees employed and total earnings for each quarterly period.)
MEA lobbyists continue to work for the passage of this legislation. The bill is currently before the House Liability Reform Committee.
Please Email Your Legislator by clicking here:
Possible Breach with Data Security – BC/BS
To our MEA-Retired members who use Blue Cross/Blue Shield insurance:
We are aware of the possible breach of data security that you may have seen in the news and have been in contact with BCBS. We will pass on information as we get it from the ORS and BCBS. MEA-Retired
This message is from the Office of Retirement Services Facebook page 2/6/15:
"We are in close contact with Blue Cross Blue Shield of MI to understand whether any of our retirees or their dependents had their information compromised as part of the Anthem data breach. At this time there is no indication that this is the case, but BCBSM is still gathering data about the scope of the breach. BCBSM is investigating the matter fully and will be communicating directly to customers about what is going on and the impact to them. Please call BCBSM if you have immediate concerns about the breach or have any related questions. In the meantime, here's an article with further information and helpful tips you might consider if you are concerned."
Anthem Hotline: 1-877-263-7995
www.AnthemFacts.com scroll down to the bottom of the page, click on FAQs
This message is from our BCBS representative, Branko Bojicic:
"BCBSM is working with Anthem to find out what impacts it may have on Michigan Blues members. As more information becomes available I will share with you. As you know, information security has been a top priority at BCBSM and BCN for years. As hacking becomes more sophisticated and new types of data threats emerge, we continually evaluate and update our internal controls to ensure privacy and security for our members. Anthem has established a web site and a call center for immediate information." He also referred us to the www.AnthemFacts.com website for more information. Today that website has this message: "Anthem was the target of a very sophisticated external cyber attack. Based on what we know now, there is no evidence that credit card or medical information were targeted or compromised."
Reports from the media:
Anthem health data breach affects millions
Roads Update in Lame Duck and School Funding Impact
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.
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.”
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)