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Senate approves Wozniak municipal retirement reform

LANSING, Mich. — The Senate on Thursday unanimously approved legislation sponsored by Sen. Doug Wozniak that would clarify that members, courts and municipalities have the ability to have a hearing with the board of the state Municipal Employees’ Retirement System (MERS) if such entities claim grievance against the retirement system.

“Retirees of our state’s municipalities who believe they have been wronged by MERS should have the right to formally appeal a decision,” said Wozniak, R-Shelby Township. “A recent unpublished court opinion now threatens the longstanding appeals process, and we can’t let it stand in the way of helping people. My legislation will ensure the process continues, as has been the intent since MERS was established 25 years ago.”

MERS is an independent, nonprofit retirement services company established by statute in 1996 that administers retirement plans for Michigan’s local units of government.

Currently, when a claimant has a dispute with a MERS decision, the claimant or the employer may submit, within 60 days, a written request for an administrative hearing to challenge the decision, known as an administrative appeal. The filing of an appeal with MERS begins a contested case process under the Administrative Procedures Act.

To clarify a potential misinterpretation of this process, as MERS is independent and not an official state agency, Senate Bill 1041 would specify in these cases that the system should be treated as such in order to maintain the long-established appeals process. Senate Bill 1042 would require the MERS board to provide claimants a hearing upon written request.

“If my legislation is not signed, decades of precedent may go out the window, with thousands of retirees left in the wake to face an uncertain and potentially costly retirement benefit dispute process that they were never meant to face,” Wozniak said.

SBs 1041 and 1042 now go to the House of Representatives for consideration.