Michigan legislators have unprecedented sums of money to spend. Some might call them “generational” dollars – not just because this much money only comes along once in a generation, but because many of these dollars are borrowed from the next generation. Almost a year ago, Michigan received an influx of emergency federal ARP dollars. Further, federal money pumped into the economy has ballooned state receipts leading to billions in state surpluses. Legislators and leaders have spent much time discussing and debating how to use these funds to help our state. As budget conversations heat up in Lansing, now is the time for elected officials to use this money to help future generations and should not fund programs that will create future costs.
This is a once-in-a-lifetime opportunity to address a major issue facing Michigan: the need to keep pension promises and invest in state and local pension investment funds. Pension promises need to be kept to honor the word we made to retirees who served our communities like police, firefighters and teachers. Paying down these liabilities will not only lift heavy burdens from future generations; they are investments that will compound and grow. We know the economy is rapidly changing, so let’s resolve this issue today.
By directing state surplus dollars to pension promises, the funding will help local governments free up ongoing revenue and expenditures for other purposes. They will be able to focus on the future of their communities, instead of putting money to fund past underfunded state and city pensions.
The West Michigan Policy Forum recently had conversations with Rep. Thomas Albert and Sen. Jim Stamas, the appropriations chairs for the Michigan House and Senate, on this topic. We’re very encouraged by their updates and supportive of their efforts. We cannot let the perfect become the enemy of the good – in order to keep the promises made to teachers, firefighters and police officers we need to remind legislators why seizing this opportunity to fund pension promises must be a priority.
We’ve seen bipartisan cooperation so far on this issue, but it’s not done until legislation crosses the finish line and is signed.
This is an important structural issue that will pay dividends for decades to come. It would be irresponsible to fail to take action now. We have a responsibility to Michigan’s children to handle this correctly and efficiently now. This will lift burdens on both current and future generations.
Contact your legislator today, make your voice heard, and tell them ARP dollars deserve to go to investing in our pension system.