According to MLive reporter Dave Murray, “Key state Senate Republicans say they’re close to a compromise on teacher pension reforms that would move educators into a 401(k)-style plan while saving school districts about $300 million.”
The House and Senate are negotiating a compromise bill to overhaul the current school employee pension system, which is over $22 billion underfunded. The most significant part of the discussion is whether or not to shift new employees into 401(k) accounts or leave them in the current defined-benefit plan, the likes of which are bankrupting cities and states across the country.
Actually, the debate is much simpler: Should public school employees get special benefits or take part in the same type of defined-contribution pension system benefiting every state government worker hired since 1997 and almost all Michigan private-sector workers (to the extent they get any retirement benefits at all)?
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