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Snyder's state task force on public retiree costs on right course

• Jul 31, 2017 at 4:00 PM

Although the real work hasn't started, we like the direction a statewide task force is taking in helping chart a viable course on public retiree costs.

The task force, seated by Gov. Rick Snyder, released a 41-page report earlier this month, noting that immediate action is needed. The document, however, contained few specific recommendations on how to bring Michigan's burgeoning unfunded liabilities under control.

At a minimum, however, it noted local units of government should meet minimum requirements to pre-fund retiree health care costs for new hires, The Detroit Free Press reported. Michigan municipalities and counties have a combined $10 billion in unfunded health retiree health care liabilities, $7.4 billion in unfunded pension commitments and $4 billion in bonded debt, the newspaper noted.

Marquette County's unfunded liability is about $16 million, $6 million of which is directly attributable to the former retire/rehire program, where dozens of county workers were allowed to "retire" and collect their pension from the MERS system while continuing their employment with Marquette County.

School districts across the state, including those in Marquette County, are also badly under water, in terms of retiree pension liabilities.

"Since every local government is unique and already utilizes a variety of retirement plans, there is no one size fits all solution to retirement reform and this task force report underscores that," Chris DeRose, CEO of the Municipal Employees' Retirement System of Michigan, said in prepared remarks. "The report rightly recognizes that many Michigan communities are already taking proactive, innovative steps to achieve full funding of their retirement plans so they can keep their promises to those who have served our communities."

Where this task force goes from here is unclear. The way forward will be politically toxic.

That said, though, we applaud Snyder for trying to do something with a nettlesome problem that his predecessors failed to address. We wish the task force the best of luck.


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