Following the July 18, 2018 Municipal Stability Board meeting, the Michigan Department of Treasury published an initial guidance document for communities that find themselves in “underfunded” status for retirement pension system and/or OPEB offerings.
Under PA 202 of 2017, all local governments with defined benefit pension or retirement health insurance offerings are required to provide actuarial and budget cost data to Treasury based upon two criteria; funded percentage of benefit offering liability and percent of general fund operating revenues that the benefit provision requires. The Municipal Stability Board was created within the new act to provide guidance to local units and approve “Corrective Action Plans” for those units that trip both of those triggers.
The “Corrective Action Plan Development: Best Practices and Strategies” document was approved by the MSB on an interim basis at their July meeting and made available for public comment. The MSB will be revisiting this document at their August 15th meeting and determining if there are any changes necessary based upon any submitted public comment.
Additionally, the League hosted a webinar this week with Treasury staff to provide additional information on the act’s waiver process and to assist communities with understanding the new Corrective Action Plan phase and offer suggestions for development of those plans. The full webinar can be viewed here.
More information and background on the act and related documents can be found at www.michigan.gov/localretirementreporting
Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and email@example.com.