New teachers will get different retirement options than current school employees under a bill sent to Governor Rick Snyder today.
This months-long argument threatened to derail budget negotiations between GOP leaders and Governor Snyder, who is anxious to get the spending plan wrapped up this week.
Republicans like state Representative Tom Albert say the current pension system is unaffordable and burns up money that could be used in classrooms and to boost teacher pay.
“So if we start reigning in the pension costs, hopefully in the future we can start paying more for a starting salary.”
The new system would provide traditional 401-K plans and a hybrid 401-K and pension plan that would require higher contributions from new teachers.
The overhaul is opposed by Democrats, teachers unions, and school administrators – who say this punishes new employees without fixing the problems.