The genesis of the story "Ingham County vs. the FOP in 1997: a Public Act 312 story"   On August 18, 2016 I posted a story with the title "End collective bargaining for public employees." I announced it with this email to subscribers: The Public Employment Relations Act (PERA) is the state law that requires local governments and public schools in Michigan to engage in collective bargaining. It never was a good idea, but recently it has been seen - by me, at least - as a major cause of underfunded pension systems and an obstacle to solutions. It must be repealed.   With such huge pension debts facing us, public employers must be granted the power to take the steps necessary to make course corrections. We cannot afford to pay public employees any more than needed to attract and retain qualified employees. Paying more than the market rate is unfair to the people paying the bills: the taxpayers. Read more . . . Political consultant and Ingham County commissioner Mark Grebner replied as follows:   Aug 18 8:41 pm   Steve -   You might note that Ingham shifted dramatically away from defined benefit pensions in 2012, my final year on the Board of Commissioners.  By a very narrow margin, the Board adopted a "hybrid plan" for all new hires, with a 1.0% multiplier, much reduced retiree health coverage, and various reforms.  We have never (to my knowledge) allowed overtime pay, sick payout, etc. to be counted in the FAC. The County may not be in perfect fiscal health, but I think our problems are manageable. Aug 18 8:53 pm Mark,   Ingham is 70.8% funded, so they are not out of the woods yet.   I admit to not fully understanding how Lansing and East Lansing got into this mess. It appears that they were making contributions as calculated by the actuary. Apparently those contributions were not adequate, and that is probably because the actuary was overestimating the rate of return on investments. And didn't anticipate the Great Recession. And pre-funding for retiree health care is a fairly recent requirement. Aug 18 9:38 pm Steve -  There's no doubt that Ingham has a long road to walk, but at least we're on that road, and walking. I have always figured that the required contributions are underestimated because the pension funds simply pretend that nobody is gaming the system.  If you become familiar with the micro-tactics of retirees, you encounter permitted conduct that should be criminal, or at least should provoke public outrage.  Lansing's "early retirement" scandal was one of the few cases that reached public awareness, but the same sort of thing happens all the time, with everybody turning a blind eye. To take one example:  Until 2012, when we shut it down, Sheriff's Department officers only needed to serve a few months as a major for the multiplier to be raised to 3.2% - FOR ALL ACCUMULATED YEARS.  In other words, somebody who had 25 years, at 2.5%, should get 62.5% x FAC.  But if his friends in the department arranged there to be a vacant major's position, the employee could be sort of dipped into it, which raised his pension to 3.2% x 25 = 80% of FAC.  And he would only serve a couple months, because there were any number of other deserving soon-to-retire officers, who needed to sit briefly at that desk and look out that window. MERS representatives acted as if they had never heard of such a thing, and also as if we had specifically chosen that practice and instructed MERS to carry it out.  They certainly didn't factor such conduct into our required contribution. As far as I'm concerned, the real problem with defined benefit plans is that elected officials can increase benefits dramatically, by just erasing a number on a page and writing in a different one.  Ten years of steady, responsible management can be undone by a bare majority acting at a single meeting.  Or even a bare majority winking and nodding at staff to allow an employee maneuver to go unchallenged. Defined contribution plans mean that benefits can only be increased if somebody puts actual money into the pot.  Defined benefit plans can be increased by obligating some future administration - maybe 30 years from now - to cover the costs. I don't see employee unions as the villains; if state law were written correctly, local governments would have to fund any benefit they award, at the time they award it. -mark grebner Aug 19 4:05 pm That is an interesting story about the Sheriffs Department officers, but it doesn't make a very good case for collective bargaining. How long had the provision allowing a bump up to the 3.2% multiplier for majors been in the contract? Who represents the county in the negotiations? The commissioners had to ratify the contract that included that provision, so they must not have been paying close attention. How did the commissioners become aware that it was a bit of scam? Aug 19 4:39 pm Steve -  Keep in mind that 312 arbitration sometimes introduces insane provisions into the agreement.  As I recall, the 3.2 multiplier was requested by the five members of that unit about 15 years ago, who generously offered to have their salaries reduced by an amount of money equal to the County's cost.  The arbitrator, who was trying to give something to both sides, thought that sounded pretty even-handed.  Over the County's objection, he awarded that paragraph to the employees. The five stuck around just long enough to push their lifetime multipliers to 3.2, then retired en masse, leaving their successors to contribute 18% of their salary toward retirement.  Meaning that the $70,000 we were paying majors was suddenly only $56,000 - not enough to attract anybody to apply for the job legitimately. As a result, neither the Board nor Controller ever had a chance to disagree.  And since the people retiring were only in their 50's at the time, I imagine they're all still alive and enjoying the bounty.  Which may last another 20 or 30 years, given the likely ages of their wives. DB pensions are full of leaks, and worrying about patching the leaks distracts from the reality that the DESIGN is wrong, not the details or implementation. Aug 23 4:48 pm Mark, I found the arbitration you are talking about. I excerpted and attached the section on retirement. Is there any other documentation on this, such as commissioner meeting minutes, news stories? Is there anybody else familiar with the case I could talk to? Anywhere I could get the names and retirement dates of the 5 majors? Aug 23 5:17 pm Steve -  I had no idea you were so serious about this!  I thought I was just swapping old yarns! Fortunately, when I tell stories, I generally get the details mostly right, and I don't make stuff up. Reading the opinion, it appears that I was wrong to think the members of the unit were majors - maybe they were all sergeants?  That's exactly the sort of erroneous information I am guilty of spreading.  Maybe either Ingham County or MIRS would answer a FOIA request for the names of everybody who was a member of the bargaining unit at the time of the award.  Or maybe they'd both tell you they don't have the information any longer. The guy who could really tell you the story would be Matt Myers, the former Chief Deputy Sheriff.  (Or Undersheriff?)  He's also the former Ingham County Controller, having left about five years ago.  Last I knew, he was retired in California, but I haven't heard from him in a while.  I'm including him as a CC, in case that email address is still valid. If this doesn't get his attention, you might ask Becky Bennett - 517-676-7200 - if she has contact info for him.  Or maybe Sheriff Wriggelsworth. You might possibly try Gerald Ambrose, who was controller at the time.  Maybe he'll remember enough to put you onto the right track.  He's living in southwest Lansing these days, hiding from howling mobs who want to discuss his brief tenure as Emergency Manager of Flint.  (Don't bring it up, if you reach him.) This is a very old scandal, which was never public back in its day.  Turns out it was 19 years ago! Anyway, I've told you everything I know, and several things it turns out I didn't know.  I look forward to hearing what you find!   I'd never before heard of Public Act 314, so I did some research, sent Ingham County several FOIA requests and posted the story "Ingham County vs. the FOP in 1997: a Public Act 312 story" on October 5, 2016. I also posted a lot of the information I obtained on Ingham County - including actuarial valuation reports going back to 1996 - here. But  before I posted the story, I sent it to Mark for his comments:   Oct 5 Steve -  My only criticism is that your article completely lacks the appropriate hysteria. For example, you don't highlight that the changed multiplier applies to all previous service, so a few months under the new contract added $10000 or more to the annual pensions, meaning $250,000 over a typical retirement for each person. You mention that the county's contribution to the pensions increased to 60%+ of payroll, but you ought to point out that amounts to $50000 per covered employee per year - an astounding uncontemplated cost.   Rough calculations of how much each covered employee increased the net-present-value of their pension by that maneuver would probably run to something like $100,000 per person - all by just tricking one arbitrator.  It makes bank robbery look like low-payoff drudgery.  I suppose the loss to the county has run well over $1,000,000. You've done a great job of collecting all the facts and figures and putting them into context.  My only suggestion is you scream yourself hoarse about it. Oct 5 Mark, thanks for the suggestions. I will keep working on it. Oct 5 Steve -  At least one sentence should be IN ALL CAPITAL LETTERS!  Angry!  People should see that you're ANGRY about what happened! Pretend you're an Old Testament prophet, and you've been sent to warn the world of God's wrath.  That'll put you in the right frame of mind. Thanks! I've already found your research interesting and useful.  Now, if it were just more entertaining.... Oct 5 The best I can do is bold italics. I think I've included most of your suggestions. My changes are below Tom Krug's picture and above The illogic of Public Act 312. Oct 5 Steve -  For a curmudgeon, you're sure calm and reasonable.  Are you planning to send links to the entire Ingham Board of Commissioners?  If you haven't done it, and don't plan to, please let me know, so I can. Thanks.  Lots of precise details, which are slightly different than what I remember, but not contradictory. Oct 5 I'll send it to the commissioners after I make sure I've got them all. This took about 10 FOIA requests to Ingham's FOIA center. They never charged me a cent.  I got all the actuarial valuation reports going back to 1997, if you ever need them. Oct 5 Steve -  If I were ever looking for a poster child for FOIA, someone who used the Act for its ostensible purpose of disinterestedly checking up on government, you certainly win the prize.  All the FOIA request I make have some sort of personal motivation, or a political angle, or whatever. Good to know they didn't try to discourage you by setting up a tollbooth.