Traverse City Record-Eagle

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May 3, 2012

Forum: Mich. must keep promises

Michigan's citizens face problems. Wages are not keeping pace with inflation, bargaining rights are being stripped away under the guise of "reform" and certain groups are facing increased tax burdens while businesses enjoy tax cuts.

These are important issues, but most important is the inability of legislators to keep their promises to citizens young and old. Starting with the abolition of the Michigan Promise, which was to be a reward to young people who did well on high school tests, and moving to recent legislation to tax retiree pensions (enacted) and modify educational employee pensions (proposed), it is clear legislators appear to have learned a different set of values than I learned; namely, a promise made is a promise kept.

SB 1040 is proposed legislation that again shifts a financial burden from the state to the backs of people who can least afford to pay; namely, educational employees. State government has taken money from the pension system and not repaid it (Gov. Engler). State government prohibits local school districts from enacting their own operational millage since the passage of Proposal A and then fails to fund districts in an equitable fashion (Gov. Engler, Gov. Granholm, and Gov. Snyder).

It is past time state government accepts its fiduciary responsibility to the educational community and adopts best practices to ensure a financially sound pension system as well as an equitable funding strategy for schools; therefore, I propose:

1) Repay money stripped from the health care portion of the employee retirement system in the early 1990s. How much is this? Various estimates put the actual amount taken to equal $140 million to $400 million, depending on who you listen to. Repay $200 million (with interest this would amount to $482,342,784. Take the money from the school aid fund, which has a positive balance. This gives immediate relief to local districts with the rate they pay toward the system.

2) Require retired school personnel currently working in a school environment to pay 20 percent of their income back to the Michigan Public Schools Employee Retirement System. This may stop the practice of double-dipping, especially by highly compensated individuals.

3) Immediately stop privatization of school employees. The number of employees paying into the system has decreased from around 340,000 in 2002 to 236,660 in 2011. With fewer people paying in, is it any wonder there is a problem?

4) Begin an immediate investigation into why administrative expenses for other post-employment benefits have mushroomed from 8 percent of total expenses to 11.1 percent of total expenses for the period 2002 to 2011, a 38.75 percent increase. With increased usage of technology, it defies common sense to see such an increase.

5) Modify Proposal A to allow local districts to put to their voters millage increases to defray operational expenses.

This puts the onus for funding where it belongs — at the local level, not in Lansing.

These best practices are achievable if the Legislature and the people want to achieve them. Keeping Michigan's promises; that would be Pure Michigan!

About the author: Chris Korbel has been a teacher for 36 years and served eight years recently on the statewide Michigan Education Association Board of Directors — an elected position. He has a master's degree in business administration, was elected president of his local for over 10 years and has bargained contracts and handled grievances.

About the forum: The forum is a periodic column of opinion written by Record-Eagle readers in their areas of interest or expertise. Submissions of 500 words or less may be made by emailing letters@record-eagle.com. Please include biographical information and a photo.

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