Important Legislative Update: Hybrid Pension Program

The 2023-4 Legislative Session has for all practical purposes come to a close.  The session wrapped up with a meltdown in the Michigan House and a record-setting marathon session in the Michigan Senate.  Before closing the books on the two-year session, the Michigan Legislature sent several pieces of legislation to the Governor that will have a major impact on state employees.  These include changes to the unemployment system, PA 152 (the so-called “80/20” law), and an opportunity for some state workers to opt into the State Police Retirement System. 
 
More on these issues below.
 
 
“Lame Duck” Session Ends with Fireworks and a Whimper
 
Following the outcome of the 2024 general election, Governor Whitmer and Democratic leaders in the Michigan Legislature were faced with the fact that their “Trifecta” would come to an end starting January 1.  At that time, Republicans would take over the majority in the Michigan House making it all but impossible to enact key Democratic priorities.  Pro-labor advocacy groups knew that time was very limited to pass a large amount of pro-worker legislation before the window of opportunity closed.
 
Complicating matters was the fact that, with a single seat majority in both the House and Senate, both chambers could not afford to have any of their members absent if they wished to move legislation.  The Michigan Senate managed to have a full complement for all but one of the session days starting after the November 5 election.  The House, however, faced serious challenges to reaching a quorum. 
 
First, Representative Reggie Miller (D-Van Buren Twp.) had a slower-than expected recovery from back surgery that forced her to miss session the first week of December.  That forced the House to take no actions that entire week.  Representative Miller was able to return to session the following week, but rumors were swirling that another member – Representative Karen Whitsett (D-Detroit) was threatening to boycott session altogether.  Fortunately for Democrats, Representative Whitsett attended session on Wednesday, December 11 through Friday, December 13.  This allowed House Democrats to pass a number of key labor priorities.  However, when she left session on Friday night, she again threatened not to return unless some of her own priorities were placed on the House agenda. 
 
When the House attempted to return to session on Wednesday, December 18, Representative Whitsett refused to attend so the House session was adjourned without taking any action.  House leaders and other Democratic leaders desperately tried to encourage Rep. Whitsett to return to session on Thursday, December 19, and they briefly succeeded.  Rep. Whitsett traveled to Lansing and entered the Capitol building but she refused to enter the House Chamber.  It is unclear exactly what her demands were, but when Speaker Tate took the rare action of enforcing a “Call of the House” (in which all members are legally required to take their seats in the House Chamber), Rep. Whitsett instead took refuge in the office of the Republican House Leader, Representative Matt Hall (R-Richland Twp.). 
 
After an hour of waiting for Rep. Whitsett to take her place on the House floor, Speaker Tate shockingly made the decision to adjourn the House, thereby ending any possibility of movement on hundreds of bills needing House approval. 
 
This outcome will no doubt be hailed as a major victory for the incoming Republican majority, and incoming Speaker of the House Matt Hall will get credit for encouraging Rep. Whitsett to scuttle efforts to pass legislation opposed by his Republican colleagues.  The Republican members of the House had already decided to boycott the Lame Duck session, arguing that Democratic leaders were not giving them enough time to review the dozens of bills they were passing (or intended to pass).  Rep. Whitsett’s refusal to attend session was the final wrench in the machine that ground the House to a halt.
 
On the other side of the Capitol, the Michigan Senate was taken aback by the news that the House had essentially collapsed.  Hundreds of Senate bills awaiting approval in the House were immediately killed.  These included bills to improve the Workers Disability Compensation law for injured workers, to remove limitations on pro-worker policies adopted by local units of government, and to make improvements to apprenticeship training programs.  For a moment, it looked like the Senate Democratic leaders might throw up their hands and adjourn like the House did.  Instead, they did the opposite.
 
After recessing for much of Thursday afternoon, the Michigan Senate prepared a list of House-passed bills that they could move forward that needed no further action from the House.  The list comprised of dozens of bills dealing with topics including such areas as criminal penalties for hate crimes, enhancements of school safety laws, codification of election security rules, and many, many more.  Most importantly to MAGE members were the passage of House Bills 4665-4467 that opened up the Michigan State Troopers Retirement System to other law-enforcement related classifications in state government; and House Bill 6058 that phases out the so-called “80/20 Law” that requires public employees to pay a minimum of 20% of the cost of health care benefits (see below for more information on the pension bills). 
 
The Senate remained in session from 10am on Thursday, December 18, to 3pm on Friday, December 19.  The 29-hour continuous session was the longest in Michigan Senate history.  The stamina of lawmakers on both sides of the aisle was severely tested, especially as the minority Republicans made speech after speech in efforts to slow the process and hopefully force the majority Democrats to drop bills from their agenda.  The marathon was an ordeal for lawmakers, staff, and even the lobbyists who remained in the Capitol for the entire period.  At the end, however, dozens of pieces of legislation were passed that otherwise would have died at the end of the year.
 
All that remains is for the Governor to sign those bills into law.  She began on December 23 by signing Senate Bill 40 – a bill that restores Michigan’s unemployment benefits to a maximum of 26 weeks (up from the 20 it had been reduced to in 2011).  SB 40 also increases the maximum weekly benefit to $614 over the next three years.  Currently Michigan’s UI maximum weekly benefit is the lowest of all surrounding states – but SB 40 will put us near the top after three years and incudes an annual cost-of-living increase after that.  We are hopeful that Governor Whitmer will sign the remaining pieces of the labor agenda that will arrive on her desk in the next week.
 
 
 
 
Corrections Officers and Others Set to be Eligible for Retirement Improvements
 
For the past two years, efforts spearheaded by the Michigan Corrections Organization (MCO) and their parent union the Service Employees International Union (SEIU) have centered on improving retirement options for law-enforcement related personnel in state government.  MAGE, in addition to other unions like AFSCME and advocacy organizations like the Coalition for Secure Retirement – MI have added their voices to the choir.  Staffing shortages have hit critical levels throughout state government, and studies of Michigan and other states indicate that a lack of retirement security has led to an epidemic of state employees leaving their jobs early to pursue opportunities in local government or the private sector. 
 
While there has been support among Democratic lawmakers to improve retirement options for all state workers, there has as of yet only been bi-partisan support for certain classifications.  Specifically, law-enforcement related classifications have received support of both Democrats and Republicans when discussing providing improved retirement benefits.  To that end, a package of bills were introduced in both the House and Senate that would allow certain law-enforcement related positions in state government to utilize the hybrid pension plan currently offered to Michigan State Troopers. 
 
House Bills 4665, 4666 and 4667, sponsored by Representatives Will Snyder (D-Muskegon), Amos O’Neal (D-Saginaw) and Jenn Hill (D-Marquette); and Senate Bills 165, 166 and 167, sponsored by Senators John Cherry (D-Flint), Kristen McDonald-Rivet (D-Bay City) and Sue Shink (D-Northfield Twp.) were both able to move in the Lame Duck session.  The bills will allow certain state workers to opt into the Michigan State Police Retirement System.  Specifically, the affected classifications are:
 
Conservation officer.
State Police Motor Carrier officer.
State Police Property Securities officer
Corrections officer.
Resident unit officer.
Corrections medical aide.
Corrections shift supervisor.
Corrections security inspector.
Corrections security representative.
Deputy prison warden.
Departmental administrator-prison warden.
Corrections resident representative.
Corrections transportation officer.
Special alternative incarcerations officer.
Certain forensics security positions with the Center for Forensic Psychiatry. (These positions would be a forensics security aide IIB or IIIB; a forensics security supervisor IVB, VB, or VIB; or a forensics supervisor VII.)
 
State workers who are currently in the SERS Defined Benefit Plan would not be eligible to make the switch (however only those active employees hired in prior to March, 1997 are in this plan which is a rapidly shrinking number).  State employees who had opted out of SERS and instead took the Defined Contribution option would also be ineligible to switch to the MSP plan. 
 
Because the House failed to have a quorum the last week of the Lame Duck session (see article above), the Senate had to pass the House versions of the bills (HB 4665-4667).  Nonetheless, special recognition goes to Senator John Cherry who was the champion of the legislation through the House and Senate.  The Senate passed HB 4665-4667 at approximately 6:30am on December 19.  All Democrats voted in favor of the bills, and they were joined by Senators Ed McBroom (R-Vulcan), John Damoose (R-Harbor Springs), Mike Weber (R-Rochester Hills), Roger Victory (R-Georgetown Twp.), and Mark Huizinga (R-Walker).  The remaining Republican Senators voted no. 
 
The Senate unfortunately did not take action on another bill, House Bill 6061, that would have created a hybrid pension plan open to all state workers.  Sponsored by Representative Regina Weiss (D-Oak Park), HB 6061 sought to create a hybrid pension plan identical to that currently offered to public school employees.  Efforts to pass such legislation will continue in 2025, but due to the lack of support for the efforts by Republican leaders, it is unlikely that those efforts will be successful in the short term. 
 
Once HB 4665-4667 are signed into law by Governor Whitmer, the Department of Technology, Management and Budget will prepare a plan to present eligible state employees a method of opting into the MSP retirement plan.  Eligible employees should be receiving more information on this in the coming weeks.