Snyder: Moving Teachers To 401(k) May Cost Less Than Thought

LANSING (AP) — Michigan Gov. Rick Snyder says transition and other costs that would come with closing the pension system to newly hired teachers may be lower than estimated previously.

The Republican governor told reporters Monday he is “always open-minded” to discussions with lawmakers. GOP legislative leaders are pushing to end a hybrid pension-401(k) plan that new school employees qualify for and instead give new hires a 401(k) only.

Snyder has been resistant previously, citing large upfront costs associated with closing a pension plan.

But he says there is new data showing that the costs of such a switch “might be somewhat less, but we’re still making determinations of what those may be.”

A legislative analysis of past legislation estimated costs ranging from $1.6 billion to $3.8 billion in the first five years.

 

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Comments

One Comment

  1. Ella Sitten says:

    It has been three years since the lead appeared in the Flint drinking water and the pipes are still not replaced. Homeowners seem to be stuck with a $5,000 bill to replace the plumbing inside of their homes that was damaged by the lack of corrosion control. The potholes are still crater sized. Where is the 3 to 5 billion dollars going to come from? Without money coming into the school employees pension plan, MPSERS, current retirees will lose their pensions. I guess it wouldn’t make any difference to Republicans in Michigan who are in favor of for profit charter schools instead of public schools. I guess education is not a priority in Michigan.

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