2015 Senate Bill 86 / Public Act 46

Authorize more local “pension obligation bonds”

Introduced in the Senate

Feb. 10, 2015

Introduced by Sen. Jack Brandenburg (R-8)

To extend for one year the Dec. 31, 2015 sunset on a law passed in 2012 to allow local governments to borrow money to cover unfunded employee pension liabilities, which is allowed only if the local has closed its traditional “defined benefit” pension system to new employees. The law also allows locals to incur long term debt to pay for future retiree health insurance costs, which unlike pensions are not legally enforceable obligations. This would be the second extension of this deadline.

Referred to the Committee on Finance

Feb. 19, 2015

Reported without amendment

With the recommendation that the bill pass.

March 4, 2015

Passed in the Senate 36 to 0 (details)

To extend for three years the Dec. 31, 2015 sunset on a law passed in 2012 to allow local governments to borrow money to cover unfunded employee pension liabilities, which is allowed only if the local has closed its traditional “defined benefit” pension system to new employees. The law also allows locals to incur long term debt to pay for future retiree health insurance costs, which unlike pensions are not legally enforceable obligations. This would be the second extension of this deadline.

Motion to reconsider by Sen. Mike Kowall (R-15)

The vote by which the bill was passed.

The motion passed by voice vote

Received

Passed in the Senate 38 to 0

To extend for one year the Dec. 31, 2015 sunset on a law passed in 2012 to allow local governments to borrow money to cover unfunded employee pension liabilities, which is allowed only if the local has closed its traditional “defined benefit” pension system to new employees. The law also allows locals to incur long term debt to pay for future retiree health insurance costs, which unlike pensions are not legally enforceable obligations. This would be the second extension of this deadline.

Received in the House

March 4, 2015

Referred to the Committee on Financial Liability Reform

May 7, 2015

Reported without amendment

Without amendment and with the recommendation that the bill pass.

May 20, 2015

Passed in the House 109 to 1 (details)

To extend for three years the Dec. 31, 2015 sunset on a law passed in 2012 to allow local governments to borrow money to cover unfunded employee pension liabilities, which is allowed only if the local has closed its traditional “defined benefit” pension system to new employees. The law also allows locals to incur long term debt to pay for future retiree health insurance costs, which unlike pensions are not legally enforceable obligations. This would be the second extension of this deadline.

Signed by Gov. Rick Snyder

June 8, 2015