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Target Meetings Postponed; Gov, Leaders Stuck On Closing MPSERS

May 24, 2017

Courtesy MIRS News

High-level meetings over next year’s budget were postponed indefinitely Thursday after Senate Majority Leader Arlan MEEKHOF (R-West Olive) and House Speaker Tom LEONARD (R-DeWitt) told Gov. Rick SNYDER they want to close the teacher pension system as part of the budget and the Governor still wasn’t sold.

The morning meeting with the three leaders was, according to multiple sources, civil and cordial, but yielded a stark difference in how the executive branch and the legislative branch want to move forward with Fiscal Year (FY) 2018. 

Meekhof and Leonard have been open about closing the Michigan Public Schools Employee Retirement System, or MPSERS, to new hires. Doing so, however, comes with a cost and leaders haven’t agreed on even closing MPSERS, let alone what the cost is.

Estimates have ranged to between $680 million in the first year to as low as $400 million in FY 2018. Then there are the costs in the many years to follow. 

And until these questions on “if, how much and how long” are answered, it would be “counter productive” for the leaders to go much future on the rest of the budget, said Meekhof Press Secretary Amber McCANN. 

“There just hasn’t been enough forward progress,” McCann said. 

Originally, the three leaders were to meet last Friday. But, they did not. When they will meet again is not known. 

“Everyone has come to terms that there are upfront costs with closing MPSERS,” said Snyder Director of Communications Ari ADLER. “There has yet to be agreement on how much that is going to cost, and how you’re going to pay for it. The Governor wants to keep responsible budgeting in place. That has to be addressed, not just for the first year, but subsequent years.”

The numbers at play are so large, it’s hard to come to final resolutions on the rest of the budget until the MPSERS question is solved, based on the opinion of the legislative leaders. Adler said the Governor did not ask to cancel any meetings.

Meekhof told MIRS after Thursday morning’s meeting “No decisions were made. It is so complicated. Sometimes I wish I was a CPA, but other times I don’t,” he suggested with a smile. “We have differences of opinions even among the folks around the table about what the numbers are, what the assumptions are and why they are what they are. And some of those (disagreements) are political questions so it’s fair to say we’re not quite there, yet.” 

Preliminary discussions involving Budget Director Al PSCHOLKA and legislative staff were “positive” Thursday. 

Democratic leaders Jim ANANICH (D-Flint) in the Senate and Sam SINGH (D-East Lansing) in the House are against closing MPSERS and support the Governor keeping the current hybrid system in place. 

“Republicans know they don’t have the money they need to fund their half-baked, fiscally irresponsible MPSERS scheme,” Ananich said. “Playing politics with the state budget has caught up to them this time. It’s shameful and they need to be held accountable.”

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