Rep. Matt Koleszar (D-Plymouth) discusses his legislation, HB 5803, that would reduce school district contributions toward teacher retirement and use the excess money to supplement classroom needs. June 25, 2024. Photo by Jon King.
Legislation to permanently end a 3% tax many public school teachers pay into a health care fund for their retirement is on its way to Gov. Gretchen Whitmer for her signature after receiving final approval in the Michigan House.
“By lowering costs for qualifying teachers on each paycheck and freeing up resources for local school districts, we are increasing flexibility for both,” Whitmer said Wednesday in announcing her plan to sign the bill into law. “We can help our educators pay the bills, put food on the table, and live better lives right here in Michigan. At the same, we can ensure our schools have the funding they need to invest in classrooms, computer labs, and libraries, expand on-campus mental health options, or shore up campus safety.”
But partisan debate over what the pending law will mean long-term isn’t over. The dispute lies in the fact that the teacher retirement system has two parts; one that funds health care costs, which is fully funded, and the other that covers pension liabilities, which is not.