LANSING, Mich. — A new retirement plan for staff of Mayor Andy Schor, will go into effect on August 1.
On Friday, the Lansing mayor sent out a memo stating that his staff, along with non-bargaining employees that were hired by the City of Lansing after August 1, 2019, will only have a defined contribution retirement plan (DC) instead of a defined benefit (DB) plan.
"Our Financial Health Team has proposed this change as a way to help prevent an increase in our unfunded costs," said Mayor Schor. "This is an effort that we have the ability to implement right now, while also providing portability of benefits to employees that generally do not stay long enough to take advantage of DB benefits."
This memo was the mayor's next step in defining the city's legacy costs after the city's Financial Health Team recommended the change.
"The Lansing Financial Health Team applauds Mayor Schor for demonstrating a commitment to the process of addressing the City's significant unfunded actuarial accrued liabilities. This unfunded liability did not appear overnight, nor will it be resolved with a single quick or painless solution. The solution will come through a series of tough actions and difficult decisions, which over time will provide the City the best chance to remain in control of how to address this challenge and to fund the necessary services to the residents and taxpayers of the City. This move is a step in the right direction, in addition to Mayor Schor and City Council's recent support of adding a Chief Strategy
Officer position to the Mayor's staff," said FHT Co-Chairs Brian Lefler and Ben Bakken.
There is still another step in the process, the city council must approve the recommendation to include any new executive management hires in the same plan.
City Council will review the recommendation at their next meeting, which is Monday, July 29.
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