Inside208

Pension/OPEB Bonding Expansion Possible

Posted on December 3, 2018 by Dene Westbrook
Rogers City Mayor Scott McLennan and City Manager Joe Hefele traveled to Lansing last week to testify with their State Senator - Sen. Jim Stamas, the bill sponsor.

Rogers City Mayor Scott McLennan and City Manager Joe Hefele traveled to Lansing last week to testify with their State Senator – Sen. Jim Stamas, the bill sponsor.

The Senate Michigan Competitiveness Committee reported Senate Bill 1129 last week with the support of the Michigan Municipal League.

This bill would extend the 12/31/2018 sunset date of the current law by five years and expand access to this bonding tool to single-A rated communities.

The League has long argued that additional tools for communities are necessary as they look for the best ways to manage their growing pension and OPEB liabilities. Senate Bill 1129 would provide such a tool. Mayor Scott McLennan and City Manager Joe Hefele from Rogers City traveled to Lansing to testify before the committee alongside their State Senator, the bill sponsor, Sen Jim Stamas.

Rogers City has conducted exhaustive research on the best options to help them deal with their growing pension liability and determined that having the ability to bond for these costs will save the city’s taxpayers over the long-run and preserve current services for their residents.

Rogers City officials testify with Sen. Stamas in Lansing last week.

Rogers City officials testify with Sen. Stamas in Lansing last week.

Expanding access to single-A communities will allow municipalities like Rogers City to consider bonding as one of their financing options as others look for ways to manage these costs.

The committee unanimously reported a substitute version of SB 1129 (S-1) to the full Senate where it is scheduled for further action this week. The League will continue working with the Legislature and Treasury to secure final passage of this proposal.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

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