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2021 House Bill 4188: Revise school pension calculations
Introduced by Rep. Thomas Albert R-Lowell on February 9, 2021
To require managers of the state-run school pension system to use a “layered amortization" method for repaying the debt accumulated by failing to contribute enough to meet the system’s pension promises to employees. This requires officials to amortize (pay back) each “layer” of underfunding accumulated in a given period over not more than 10 years. The bill would also permit and require pension managers to assume 6.8% annual growth in pension fund assets when determining the amount needed to make good on future pension promises.   Official Text and Analysis.
Referred to the House Appropriations Committee on February 9, 2021
Reported in the House on December 1, 2021
With the recommendation that the substitute (H-1) be adopted and that the bill then pass.
Substitute offered in the House on January 25, 2022
The substitute passed by voice vote in the House on January 25, 2022
To establish procedures and standards for managers of the school employee retirement system to select a vendor for the defined-contribution annuity option authorized for retirees by the 2017 pension reform law that largely replaced the perennially underfunded “defined benefit” pension system with one that offers 401k accounts with fairly generous employer contributions, or an annuity to be created later, which this bill now would do.
Received in the Senate on January 26, 2022
Referred to the Senate Appropriations Committee on January 26, 2022
Vetoed by Gov. Gretchen Whitmer on December 22, 2022