Court Opinion

ID: 9655495
Source: CourtListenerOpinion
Date Created: 2023-08-23 19:12:22.010701+00
Date Added: 2024-06-11T18:13:19.155223
License: Public Domain

Levin, J.
(dissenting). The question presented is whether the School Code of 1976 authorizes a school district to agree to pay early retirement incentives. We would hold that a school district is not authorized to do so.
*226The state appropriates in excess of $500,000,000 per year to the public school employees’ retirement systems, of which over $115,000,000 funds current service contributions.1 The Attorney General alleges that sustaining the authority of school districts to pay early retirement incentives will have a serious adverse effect on those systems. The plaintiffs respond that it will not have an adverse effect if the Legislature fully funds the retirement systems. If early retirement incentives require that additional funds be provided in order to fund the systems fully, however, additional legislative appropriations would be required to cover the cost of early retirement incentive programs agreed to by school districts.
The instant case was decided by entry of a summary judgment without a factual record. We therefore do not know what the cost would be to the state of a decision of this Court sustaining the validity of such agreements.
I
It can indeed be argued that the question is one of law and that the meaning of § 1255 of the School Code of 1976 should be determined without regard to the cost to the state of a construction favoring the validity of such agreements. The potential cost to the state, however, has in our opinion considerable bearing on the likely legislative intent and cannot responsibly be ignored by this Court.
It appears from the complaint that school districts will be financially advantaged by early retirement incentive agreements. They can reduce their teaching staffs without discharging teachers *227and hire replacement teachers at lower salaries. But it also appears that such programs, by increasing the number of years that retired teachers would draw pensions from the state retirement systems, may substantially increase the drain on those systems and the attendant annual cost the state must bear to fund those retirement programs.
Although we do not have a record in this case, it appears from Fair Lawn Ed Ass’n v Fair Lawn Bd of Ed, 79 NJ 574, 582-583; 401 A2d 681 (1979), that the amounts potentially involved are large. It was there "estimated that a decrease of only one year in average retirement age would increase annual State contributions by nearly $12,000,000”. The New Jersey Supreme Court took what we believe to be the responsible course in holding "that actions taken by a state agency which may substantially affect retirement age and thus the actuarial assumptions of a statutory pension system are impermissible unless clearly and unequivocally authorized by the Legislature(Emphasis added.) There has been no such clear and unequivocal authorization by the Legislature in this case.
II
The plausible linguistic argument in the opinion of the Court fails to take into account the language of § 4(1) of the Public School Employees Retirement Act of 19792 providing that "compensation” shall exclude "other fringe benefits paid by and from the funds of employers”. We read that language as a declaration of public policy that fringe benefits paid from the funds of employers of public school employees shall not enlarge the cost *228to the state of funding public school employees’ retirement systems. Where the Legislature has enacted two complete and self-contained statutory schemes addressing discrete problems, neither should be construed to frustrate the purposes and objectives of the other. See Mathis v Interstate Motor Freight System, 408 Mich 164; 289 NW2d 708 (1980). See also Perez v State Farm Mutual Automobile Ins Co, 418 Mich 634, 648-650; 344 NW2d 773 (1984) (lead opinion).
A legislative policy of protecting state funded retirement systems from the cost of early retirement programs is also reflected in 1984 PA 3, which permits early retirement of state employees in a carefully constructed program designed both to protect the state retirement systems and to limit the number of persons who may avail themselves of early retirement. Act 3 limits the number of early retirees to those who are eligible and exercise the early retirement option in one month —May, 1984 — and requires that the entire cost of that early retirement program be paid from the budgets of the departments of state government that will benefit therefrom so that the retirement systems are saved harmless from all added costs resulting from early retirement. The Court’s construction of the School Code does not contain such safeguards, nor does it guard against the risk noted in the advice of the Department of Management and Budget respecting Act 3, that if the proposed one-time early retirement program were to be "repeated or made a permanent feature of the state retirement program (and strong pressure would exist to do it), it would result in adding significant long-term costs to the state retirement system”.3
*229Early retirement incentives may constitute sound public policy. But this is a policy decision that the Legislature has reserved to itself. The Legislature has not delegated to the parties to this litigation the resolution of that question with all its fiscal implications for the people of this state.4
Kavanagh, J., concurred with Levin,

 1983 PA 125.

 MCL 38.1304; MSA 15.893(114), first added to the predecessor Public Retirement Act by 1963 PA 102, MCL 38.201; MSA 15.893(1).

 Letter to the Governor dated September 15, 1983.

 We see no need to consider the language of the PERA because the PERA only requires bargaining concerning a subject matter about which a school district is authorized to bargain. Clearly, the PERA does not authorize school districts to bargain concerning the payment of benefits that the Legislature has not authorized a school district to pay.
The disposition we believe to be correct makes it unnecessary to consider whether Const 1963, art 9, § 24 requires a school district to fund in full its obligations under an early retirement incentive program.