LANSING, Mich. (AP) — Republicans who control the Michigan Legislature on Wednesday continued efforts to save money on retiree benefit costs related to state employees.
The GOP-led Senate approved a bill by a 23-13, mostly party line vote that would require employees covered by state pension plans to decide whether to remain in the pension plan or convert to a 401(k) system. Workers who choose to remain in the pension plan would have to contribute 4 percent of their compensation to remain in it.
The bill returns with relatively minor changes to the Republican-led House, which approved an initial version of the bill earlier this fall. Both chambers must agree on the same language before it can be sent to Republican Gov. Rick Snyder for his consideration.
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Democrats and some state employee labor unions said the measures erode benefits for state workers who will be retiring in the future. But there are some provisions that would benefit state workers, at least in the short term.
The bill would eliminate the 3 percent employee contribution that state workers have been making since last year to help cover retiree health care costs. Those contributions, which have been challenged in court cases, would be refunded to workers.
Retiree health insurance coverage would be eliminated for new employees hired after Jan. 1, 2012. That benefit would be replaced through a 401(k)-like system for health coverage. Similar options would be available to current state workers if they were hired in 1997 through this year.
Republicans say the measures are necessary to reduce the long-term costs of the state employee retirement system.
"If we do nothing, it will collapse," said Sen. Mark Jansen, a Republican from Kent County's Gaines Township.
Separately, the Senate approved bills aimed at blocking the offering of taxpayer-paid health insurance to domestic partners living with some public employees. Those measures return to the House with changes.
The legislation would prohibit some public employers from extending health benefits to unmarried partners of employees, whether they are of the same sex or opposite sex. It would apply to public schools, local governments and some state employees.
It would not apply to public universities, which have constitutional power to determine their own policies.
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The retiree benefit bills are House Bills 4701-2.
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