State program reimbursing U.P. universities for overpayment
HOUGHTON — A state retirement program is reimbursing Michigan Tech and other universities for years of overpayments. ABC 10 / CW 5 talked with University President Glenn Mroz about why this happened.
Michigan Tech is in the process of getting millions of dollars back from the Michigan Public Schools Employees Retirement System. Tech was one of seven state universities to receive a refund due to a miscalculation on the payments owed to the pension program. Tech has been overbilled for almost two decades.
More than $11 million dollars, which includes accrued interest, was returned on Tuesday with more money still to be refunded. But how does a mistake like this happen?
Michigan Technological University President Glenn Mroz said, “Some of the money that we were paying was not reported to the actuaries. So the actuaries actually
calculated a higher number for what was owed than what we actually owed.”
Steps are being taken to keep this from happening again.
Michigan Tech is working with the state legislature to come up with a way to even the playing field for the seven MPSERS universities.
Mroz said, “K-12 system, community colleges, and libraries had their liability capped a couple years ago and we were excluded from that legislation at that time and we’ve
been working with people in the legislature to fix that.”
Payments made by MPSERS employees into the fund were not affected. Michigan Tech stopped participating in the program in 1996 but are still required to continue making payments to fund the pensions of members until 2036.
The refund will go toward that ongoing liability.