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Impact of a Pension Cost Shift

posted Dec 18, 2014, 9:48 AM by School Publications

The possibility of a “Pension Cost Shift” once again looms for school districts because it is believed that the current “Pension Reform” will be found unconstitutional. When the cost shift was first discussed a couple of years ago, it was believed that the shift would be phased in over a period of time. I have used utilized a .5% shift per year over the span of 15 years to calculate the impact on our school district. Over the 15-year phase-in period, it would cost Brownstown #201 approximately a total of $900,000. The annual expense to Brownstown #201 after the phase-in was complete, would be in the range of $105,000-$130,000. In the original discussions, it was understood that the state wasn’t going to provide a revenue opportunity to help offset the new expense. 

Adam Bussard

Brownstown BCUSD #201 Superintendent