SMC, LMC may still be on the hook for retirement funds | Local News

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Southwest Michigan’s two community colleges may owe money to the state’s school employee retirement system, even after the Legislature ended the requirement that such institutions pay in for part-time student workers.

Southwestern Michigan College and Lake Michigan College have submitted information to the Michigan Office of Retirement Services in connection with legislation passed in June exempting part-time student workers. The question remains whether the state will require community colleges to reimburse the state for contributions not made in the past.

The new also requires the state’s community colleges to report what they have or have not contributed to the system over the last four years.

LMC and SMC reported they submitted information to the ORS by an Aug. 31 deadline. The ORS then had 30 days to review all the community college information and submit a report about what colleges may or may not owe to the Michigan Public School Employee Retirement System.

The issue came to the forefront late last year and early this year when the Michigan Office of Auditor General audited SMC records and concluded that the college failed to make MPSERS contributions for about 500 part-time student workers and owed $388,600 to the state.

SMC officials disagreed and are suing the OAG over whether it has the authority to audit the college. That suit is pending in the Michigan Court of Appeals. SMC officials further pushed to get the legislation mentioned above to clarify the issue.

LMC spokeswoman Candice Elders said this week the college is ready to submit more information if required.

“We will cooperate fully to ensure our former student workers are fairly compensated in accordance with the legislation,” she said.

She said the college included 429 students in the ORS report for the years 2015-18. Of that number, she said it appears there were 214 students who were incorrectly excluded from retirement benefits “based on the regulations as we understand them now.”

Elders said the college has not received any invoice or estimated dollar amount from the ORS. An internal estimate put that number at about $164,000, she said.

SMC President David Mathews said he could not provide similar totals for his college, but he said the college did provide the state with payroll information for all student workers for the four-year period.

He said SMC officials still have questions about which student workers should or should not have been enrolled in MPSERS. He gave examples such as students who are funded by work study programs and students taking a mix of classes from SMC and other universities.

“We also believe that the ORS had approved the non-enrollment of student workers whose primary relationship with the college was that of a student, not of an employee,” he said. “This is what (the new law) clarified and what was the understanding of the majority of community colleges.”

ORS spokesman Caleb Buhs said all community colleges are being asked to provide demographic information, wages and hours worked by school term/semester and state/school fiscal year.

“The purpose of the study is to gather the information necessary to make appropriate policy decisions,” he said.

He said all community colleges have paid into MPSERS on behalf of most employees, with the question now only about part-time student workers. “This study will tell us which ones paid into MPSERS on behalf of some or all of their part-time student employees,” he said.

ORS officials made their position clear in testimony before a state Senate committee in the spring. Director Kerrie Vanden Bosch told legislators her office’s position has always been that part-time student workers should be enrolled in MPSERS. She said there is a provision in the law that allows state aid to be withheld to cover any MPSERS contributions owed.

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