LANSING, Mich. — The state Senate early Thursday morning approved a multi-bill package that would address the shortfalls in municipal employee pension plans throughout the state.
“Government starts in our communities,” said Sen. Marty Knollenberg, R-Troy. “Our local governments provide many crucial services that we rely on every day. These are our neighbors, our friends and our families and we need to ensure that financial promises made to them are met.”
Senate Bills 686 and 688-699 seek to address the current $18.8 billion local governments are facing on their pension and retirement health care obligations. The bills would create additional reporting requirements for local governments with unfunded liabilities to aid in developing and implementing plans to address taxpayer-funded obligations.
More than 300 Michigan local governments throughout the state offer retiree health care benefits and another 600 offer some form of pension. However, recent findings show a total unfunded liability of $18.8 billion for both pension obligations and retiree health care benefits.
“The passage of these bills was a true testament to democracy and compromise,” Knollenberg said. “Through hours of diligent work and meeting with constituents and my colleagues we were able to approve a bipartisan solution that left all involved parties satisfied.”
The bills seek to address the funding shortfalls by increasing transparency and preserving local control. While many local government and labor leaders have already taken steps together to address their unfunded liabilities, these reforms are designed to help locals that either are unaware of their growing debt issue or have not been able to sufficiently address the problem.
“I appreciate the work from firefighters and police officers, who came from every corner of the state to meet with legislators,” Knollenberg said. “These men and women were instrumental in getting these reforms accomplished through hard work and compromise.”
SBs 686 and 688-699 now go before the House of Representatives for consideration.