Friday, January 29, 2010

Retirement Benefits Attacked

Today the state budget director, Bob Emerson, outlined proposed changes to the Michigan Public School Employees Retirement System.

The proposed changes:

Public school employees who are members of the Michigan Public School Employees Retirement System (MPSERS) will be subject to the following changes effective October 1, 2010:

* To ensure MPSERS is financially sound, employee contributions to the plan will increase by 3 percent for all employees except those in the MIP Plus program whose contribution was increased in 2008. MIP Plus members' contribution will increase by 0.9 percent.

* Elimination of subsidized retiree vision and dental coverage for school employees retiring with an effective date after October 1, 2010. Retirees will be able to purchase this coverage for a monthly fee through the plan.

* The retirement multiplier will be increased from 1.5 percent to 1.6 percent for employees who retire with an effective date between July 1 and September 1, 2010, which will be paid by the applicable school districts.

* A new, more cost-effective hybrid retirement plan for new employees hired on or after October 1, 2010, will be created. New employees will participate in both a base defined benefit plan and a defined contribution plan.

* Phased retirement option for retiring employees age 60 or older. Phased-in retirement will be allowed for up to three years, enabling employees to collect their DB plan retirement with a workload of no more than 20 hours per week for a previously full-time employee. This option is available to the employees at the discretion of the school districts.

Check back here for more information on this attack on your benefits.