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Legislature to tackle local pension overhaul

Nov 30, 2017

Credit Michigan Municipal League

The state would evaluate retirement funds in every Michigan city, township, village, and county under a legislation rolled out today by Republicans in Lansing. Communities with under-funded liabilities would have to fix that, or a state-appointed financial management team would step 

House Speaker Tom Leonard says local governments would have a chance to reach a consent agreement to fund pensions and retiree healthcare. But the team could impose its own plan if no agreement is reached. He says that could include forcing a community to sell assets.

“Quite frankly, if we’ve got a local municipality that values funding a golf course over our firefighters’ and police officers’ health care, they ought to have that authority,” Leonard said.

Republican leaders say the local pension overhaul is their top priority between now and the Legislature’s winter break. 

Democrats are not on board with the bills.  

State House Minority Leader Sam Singh says the state helped create the problem by short-changing local governments. He says an overhaul of revenue sharing should also be part of the discussions.

“Over $7.5 billion over the last 15 years have been taken away from local governments to balance the state’s books," Singh said. "And for us not to actually have a revenue solution on top of these other provisions will never help these communities.”

Hearings on local pensions will begin next week.