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Supreme Court to decide if state has to give back $550 million to teachers and school employees

Nov 8, 2017

The Michigan Supreme Court hears oral arguments today in a long legal battle between the state and a large group of public school employee unions.

The spotlight is on a 2010 law that dates back to the Granholm administration. The law required public school employees to contribute 3% of their salaries to retiree health care.

And even though that practice has ended, the money paid from the summer of 2010 until January 2013 is sitting in an escrow account that now tops $550 million.

Governor Snyder wants the money for the state.

The unions want it given back to teachers and school employees.

MLive's Emily Lawler joined Stateside to talk about the case.

Originally, the 2010 law was designed to tackle retirement health care funding.

“Organizations and municipalities across the state are struggling with this even still today, but retiree health care was really a rising cost, and something that the state felt a need to reign in at some level, and, for teachers, they asked for a 3% contribution to go toward retiree health care,” Lawler said.

The 2010 law that required that contribution was later ruled unconstitutional. Lawler said that the question now is what to do with the money that was collected during that time.

“The amount of money that’s in this escrow fund that has been collected — teachers say they want it, the state wants it for their retirement — is $550 million,” Lawler said. “So all that money from all those school employees really adds up.”

Listen above for the full conversation. 

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