CORUNNA — The Shiawassee Board of Commissioners voted 6-1 Thursday to increase the Municipal Employee Retirement System (MERS) contribution by current non-union represented employees.
The non-rep contribution, which is deducated from employees’ pay, will increase from 1 to 3 percent Jan. 1. The contribution will jump to 5 percent Jan. 1, 2022. Non-represented employees include elected officials and employees in the prosecutor’s office, health department and district court.
“That additional amount of money will go into the MERS fund to help with legacy costs,” County Coordinator Brian Boggs said following Wednesday’s Committee of the Whole meeting. “We have $34 million of unfunded liabilities so that’s important.”
Commissioner Brandon Marks, R-District 4, voted against the proposal Thursday. He said while he supports the increase in non-rep contribution, he believes it should be higher.
“It’s not the time to take baby steps,” Marks said after Wednesday’s Committee of the Whole meeting. “Baby steps should’ve happened 20, 30 years ago. Now’s the time for a big adjustment and it hurts, and is it fair to these employees? No it isn’t, but we have a job to do, and it’s to make sure that the budget is right 30 years from now and beyond.
“I intend to do my part so that no one else inherits what we’ve inherited, things like what we’ve inherited with the MERS problem, the massive legacy costs,” he said.
Thursday’s motion to increase non-rep contributions adds to the board’s numerous efforts to combat a long-term MERS problem.
In September, commissioners voted unanimously to close the MERS defined benefit plan to new employees, effective Jan. 1. The move does not affect any employees currently participating in MERS, Boggs said at the time.
Additionally, it will be up to the board of commissioners to negotiate the discontinuation of MERS across all union contracts as they are renewed in the coming years.
The county is considering a switch to a defined contribution program for new employees, though no formal action has been taken at this point. A defined contribution plan means employee benefits are determined by how much they contribute over time and are not outlined ahead of time.