Michigan teachers to receive refund

OSCEOLA COUNTY — Before leaving for the holiday break, school staff and faculty across Michigan received an early Christmas gift. Those who worked in a school system between 2010 and 2012 would be refunded the 3 percent they had paid toward the Michigan Public School Employees Retirement System (MPSERS).

In 2010, the Michigan Legislature took action to build up the MPSERS, said Mecosta-Osceola Intermediate School District Assistant Superintendent Mark Klumpp.

“One action involved public school employees paying 3 percent of their salary into MPSERS in order to fund retiree healthcare,” he said. “These contributions started on July 1, 2010, under Public Act 75, but their constitutionality was challenged by the Michigan Education Association and American Federation of Teachers. The legislature recognized there was a flaw in the initial act in the summer of 2012, and as such passed Public Act 300 for effect Sept. 4, 2012.’

Klumpp said PA 300 allowed school employees the option to pay the 3 percent into MPSERS and receive a health insurance premium or to opt out.

“The question that has been before the court system since 2012 has been whether PA 300 corrected the PA 75 contributions from 2010 to 2012,” he said.

Late last month, the Michigan Supreme Court ruled PA 300 did not change PA 75, Klumpp said. Now, more than $550 million in employee withholdings and interest will be returned to the schools to be distributed back to their employees.

“This is something that has taken several years to resolve,” Klumpp said. “We know employees are very anxious to get their funds back. However, there are several tax and payroll implications that must be considered before rushing to repay these funds. We would encourage any individuals that worked for a school district between 2010 and 2012 to verify the district they worked at during that time frame has their updated contact information.

“The Office of Retirement Services should be commended for their quick turnaround with the funds and data so quickly after the Supreme Court Ruling. The MOISD anticipates we should be able to return funds to our employees sometime in February.”

MOISD Superintendent Steve Locke said the refunds will come from the school district employees worked for from 2010 to 2012.