MFT and SRP Michigan Federation of Teachers & School Related Personnel

 

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April 2003

MPSERS Rumors
Another Charter School Bill Introduced
Detroit School Reform Board Legislation Passes Senate
Districts Could Set School Cell Phone Policies
Budget Negotiations Continue
School Aid Bill Passes House

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may be found on the Legislative Hotline page of this website.

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MPSERS Rumors

Many school district and community college employees have heard rumors that the State of Michigan will soon be offering an early retirement proposal for all members of the Michigan Public School Employee Retirement System (MPSERS).

Representative Minore (D-Flint) has introduced House Bill 4486, which would increase the public school retirement multiplier to 1.75 percent of the member's final average compensation from 1.5 percent after April 1, 2004. The bill is before the House Appropriations Committee but has not been scheduled for a hearing. Every session legislation is introduced to increase the retirement for school employees, and every session these bills do not move. The passage of such legislation is highly unlikely.

Our concerns with this type of legislation are as follows:
  1. A 1.75% factor, even as a one-time early retirement incentive, would create funding problems to the system at this time;
  2. Due to reduced investment earnings, MPSERS is currently funded at only 91.5%;
  3. The sudden unanticipated increase in retirees - each receiving a higher pension for life than MPSERS anticipated-would additionally drain the funding of the pension fund;
  4. MPSERS would have to continue to pay the health insurance cost (which are funded on a pay-as-you-go basis) for retirees as well as for their current employees; and
  5. The savings generated by "graded premium" retiree health care would not be realized for at least ten years and would do nothing to alleviate the funding problems created by an early retirement incentive.
While we recognize our members deserve a retirement increase, we cannot support a proposal that threatens the financial stability and longevity of your retirement (MPSERS); or that would cause a decrease in health care coverage (graded premium retiree health care). Should anything occur to change this situation, we will notify our locals immediately.

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Another Charter School Bill Introduced

Senate Bill 393 (Kuipers, R-Holland), entitled the Charter School Oversight and Accountability Act, would provide for 350 additional charter schools, including 50 high schools through 2012. Under this bill, charter schools would have to:
  1. Does not close Bay Mills "loopholes";

  2. Provides for some additional oversight;

  3. Increases public access to information at new charter schools using management companies;

  4. Includes collective bargaining provisions for new charter schools authorized by ISDs.
Though the Governor's office has not yet reviewed the legislation, their only comment has been that the bill provides for too many new schools. It contains twice as many as the McPherson Commission suggested.

Earlier in the month, Superintendent of Public Instruction Tom Watkins had refused to grant school district numbers to seven Bay Mills authorized charter schools. Without a district number these public school academies would not have been able to file for school aid payments in the fall.

Although Mr. Watkins said he had authority to take that step, the denial was under legal review by the attorney general and the Bay Mills tribe was considering a lawsuit. After the introduction of Senate Bill 393, Mr. Watkins reversed his earlier decision that would have denied state aid to seven new schools chartered by Bay Mills Community College.

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Detroit School Reform Board Legislation Passes Senate

Senate Bill 157 (Scott, D-Highland Park) passed the Senate on April 3 and was referred to the House Committee on Commerce. This bill would require that the question of whether to retain the school reform board and chief executive officer of the Detroit Public School District, and the authority to appoint them, be placed on the ballot at the August 2003 primary election in Detroit.

Republican legislators have stated publically the reason for supporting this legislation is to remove this issue from the November 2004 ballot. They fear this will increase voter turnout for the 2004 President election.

Under current law, the question must be placed on the ballot in the November 2004 general election If the ballot question is approved by a majority of the school electors voting, the school reform board and the chief executive officer continue in place in the district. The authority of the mayor to appoint members of the school reform board continues. Additionally, the question may be placed on the ballot again after the expiration of five years following the election at which the question is approved, if sufficient petitions are filed.

If the ballot question is not approved, the school reform board must arrange with local election officials for the election of a new elected school board for the school district. This election must be at a special election held as soon as practicable, but not sooner than 90 days after the election on the ballot question. The bill would retain these provisions.

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Districts Could Set School Cell Phone Policies

Senate Bill 294 (Cherry, D-Burton) would permit the board of a school district to adopt and implement its own local policy concerning whether pupils could carry pocket pagers, electronic communication devices, or other personal communication devices in school, beginning with the 2004-2005 school year.

Currently, school boards must prohibit pupils from carrying these devices, unless a board approves their use for health or other unusual reasons. Under the bill, this provision would apply until the end of the 2003-2004 school year.

This bill passed the Senate on March and now moves to the House Education Committee.

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Budget Negotiations Continue

The House left for spring break without passing the Higher Education Budget or the Community College Budget out of their respective subcommittees. Both appropriations subcommittees will resume budget deliberations when they return on April 29th. It has been estimated that the state budgets will not be completed until mid summer.

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School Aid Bill Passes House

House Bill 4401(Representative Shulman, R-West Bloomfield), has passed the House and is awaiting action before the Senate Appropriations Subcommittee on K-12 School Aid. Listed below is a comparison of current law, the Governor's Proposal, and House Bill 4401. The Governor's Proposal is a balanced budget, however, House Bill 4401 is $45 million over projected revenues. The Senate will work on their version of the school aid budget in May.
SCHOOL AID
Fiscal Year 2003 - 2004
SECTION NO. SECTION CURRENT LAW (BEFORE PRORATION) GOVERNOR'S PROPOSAL HOUSE BILL 4401 (H-1)
(Dollars in millions)
Sec. 6 (4) Pupil Membership Blend A sum of 80% of current fall pupil count plus 20% of the previous February's count. A sum of 50% of current fall pupil count plus 50% of previous the February's count (Saves $40 million). Retains current law.
Sec. 6(4)(y ) Declining Enrollment for Lower Peninsula

1,550 pupils or less & 4.5 pupils per square mile & allow 3 year average of pupil membership
Small, rural districts may use a 3-year average membership blend if doing so results in higher membership than the actual current year blend. Applies to Lower Peninsula only. Deleted Retains current language, but expands it to also include districts in the Uper Peninsula.
Sec. 11 (3) Proration Language Requires an across-the-board proration when revenues are expected to fall short of appropriations. Concurs with Current Law. Replaces language with a requirement for the State Budget Director to develop a fair and equitable method of reducing payments.
Sec. 20 (l0) Consolidation Language Foundation allowance for districts that consolidate after June 1, 2002, to be $50 per- pupil above the highest foundations allowance of the consolidating districts, capped at the "hold-harmless" state maximum. Gives districts consolidating after June 1, 2002, a pupil-weighted average foundations allowance plus $10, or the state maximum, whichever is less. $1 million - Gives consolidating districts and districts that are annexed a pupil-weighted average foundation allowance.

Creates a consolidation incentive program that pays $50 per pupil in a consolidated district, with payments to district capped at $500,000 per consolidated district.
Sec. 20 (19) Small Class-Size Grants $26.7 million The foundation allowance of districts that received a grant under former Section 32e for small class-size grants shall be increased by the per-pupil amount of the small class-size grant in FY 2002. Concurs with Current Law. Reduced to $20.1 million
Sec. 20 (20) Foundation Allowance Increase for districts with a Reform Board The foundation allowance of a district with a reform board in place shall be increased by a per-pupil amount sufficient to result in additional revenue to the district of $15 million. Concurs with Current Law. Eliminates language that would allocate $15 million on a per-pupil basis to the Detroit School District in FY 2003-2004.
Sec. 22a & Sec. 22b Foundation Allowances See Chart March Capitol Report Same as FY 2003. Same as FY 2003.
Sec. 24 Court-Placed Pupils $8.9 million $10.9 million $10.9 million
Sec. 26a Renaissance Zones Reimbursement $10.2 million $27.9 million $27.9 million
Sec. 31a At-Risk $314.2 million $314.2 million (Expands the allowable uses of funds to include tutorial services and programs that combine academic, enrichment, and recreational activities.) $314.2 million
Concurs with the Covernor and includes the following additional uses; early childhood programs, ESL programs, and uses allowed under Section 98b (Learning Without Limits).
Sec. 31d (1) School Lunch $18.1 million $21.3 million $21.3 million
Sec. 32c Early Childhood Grants $2 million $0 $1 million
Sec. 32d School Readiness $72.8 million $72.8 million $72.8 million
NEW
Sec. - 32j
ISD Early Literacy & Parent Education Not Applicable $3.3 million $3.3 million
Sec. 41 Bilingual Education $4.2 million $4.2 million $4.2 million
Sec. 56 ISD Special Education Millage Equalization $38.1 million $36.9 million $36.9 million
Sec. 57 Gifted & Talented $5 million $0 $0
Sec. 61a Vocational Education $31 million $30 million $30 million
Sec. 62 ISD Vocational Education Millage Equalization $9.8 million $9.5 million $9.5 million
Sec. 67/68 Career Preparation $22.2 million $0 $0
Sec. 74 Bus Driver Safety $1.6 million $1.6 million $1.6 million
Sec. 81 (1) ISD General Operations $95 million $88.7 million $91.4 million
Sec. 94a CEPI - & Standards & Poors $6.8 million ($2.5 to maintain Standards & Poors contract) $2.8 million (Standards & Poors not renewed) $4.9 million ($2 million allocated to continue Standards and Poors contract)
Sec. 96 Golden Apple Awards $1.3 million $0 $0
Sec. 98 Michigan Virtual High School 5 million ($3.5 million allocated to Wireless Technology Program) $2 million ($1 million for Wireless Technology Program) $1 million for the MVU and transfers the Wireless Technology Program to new Section 98b.
NEW
Sec. 98b
Learning Without Limits Not Applicable. ($3.5 million for Learning Without Limits grants is currently in Section 98) Not Applicable. ($1 million for Learning Without Limits grants is currently in Section 98) $24.7 million in total funds and adds new language that expands a pilot program to purchase wireless technology for 6th grade pupils.
Sec. 99 Math/Science Centers $10.2 million $0 $5 million
Sec. 99a School Health Curriculum Grants $3.2 million $0 $0
Sec. 105 (17) - (20) Schools of Choice Guarantee If fewer than 90% of the pupils living in a local school district attend school in that district, the district foundations allowance payment shall be paid as if exactly 75% were enrolled in the district for 02 - 03, 50% for 03 - 04, and 25% for 04 - 05. Deleted Concurs with Governor
Sec. 107 (1) Adult Education $77.5 million $20 million -- Language added to allow providers to charge tuition unless participant's income is at or below 200% of federal poverty level. $28.5 million
Sec. 108 Adult Learning (PAL) $20 million $0 $0
Sec. 147 Public School Employees' Retirement Rate 12.99% 12.99% - If districts participating the School Bond Loan Fund assist State Treasurer with refinancing bonds. Rate will revert back to 14.37% for all districts if this does not occur. Concurs with Governor.



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May 13, 2003
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