The Michigan Senate and House passed legislation on Thursday creating a Municipal Stability Board within the state's treasury department to oversee the funded status of municipal pension plans.
The proposed Protecting Local Government Retirement and Benefits Act creates the board for municipalities in Michigan that have a funding ratio of 60% or less and whose annual pension contribution is more than 10% of its revenue.
The three-member board, which will consist of a state official, local official and member representing employees and retirees appointed by the Michigan governor, will review and annually update a list of best practices for municipalities with underfunded plans, and those municipalities will be required to submit a corrective action plan within 180 days of receiving notification from the board of their underfunded status.
Thomas Albert, state representative and sponsor of the bill, and Jennifer Mausoff, spokeswoman for the $10 billion Michigan Municipal Employees' Retirement System, Lansing, was not available to provide further information.
