LANSING, Mich. – Michigan legislators have passed school pension reform that is estimated to save taxpayers about $970 million during the next two years, the Detroit Free Press reports.
According to the Free Press, the bill attempts to address health care costs by requiring most employees and retirees younger than 65 to pay 20 percent of their own health care costs, while providing new employees with a health savings account instead of the benefits provided to current employees.
Some say the changes will eliminate $15 billion of nearly $50 billion in unfunded liabilities associated with the state school pension system, according to the Free Press
SOURCE: Detroit Free Press, “Retired teachers will get less as Legislature overhauls pensions, health care,” Aug. 16, 2012
FURTHER READING: Michigan Capitol Confidential, “The State Is Already Addressing ‘Transition Costs’ in School Pension Fund,” Aug. 8, 2012