Michigan lawmakers look at changing future teacher retirement fund payments
State lawmakers are debating a change to the way the future teacher retirement fund’s growth is projected.
Currently, projections for future retirement fund payments are based on an assumption that school payroll will grow by 3.5% annually.
State Rep. Thomas Albert (R-Lowell) says that’s a problem.
“Without change, I have serious concerns that this mountain of debt will become too steep and the costs will overcome the school aid fund,” says Albert.
Albert’s bill would gradually reduce the payroll growth assumption until it reaches zero in 2025.
He compares it to switching from an adjustable rate mortgage to a fixed rate, making it a more predictable, less risky way to pay off the system’s accumulated debt.
Albert’s bill has passed the House and is now before the Senate Education committee.