November 6, 2008, Introduced by Reps. Byrum and Miller and referred to the Committee on Tax Policy.
A bill to amend 1976 PA 451, entitled
"The revised school code,"
by amending section 1224 (MCL 380.1224), as amended by 1992 PA 19.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1224. (1) At the request of an employee and as part of
the employee's compensation arrangement, the board of a school
district may purchase a tax-deferred investment for an employee for
retirement or other purposes and may make payroll allocations in
accordance with the arrangement to pay for the tax-deferred
investment. The allocation shall be made in a manner which will
qualify all or part of the tax-deferred investment for the benefit
afforded under the federal internal revenue code or other federal
income tax law. The employee shall own the tax-deferred investment.
The employee's rights under it shall be nonforfeitable except for
failure to make required payments.
(2) The board shall establish and maintain a bidding process
for any investment administrative services it uses to procure the
tax-deferred investments. The bidding process shall assure that
providers of investment administrative services that are
headquartered or doing a majority of their business in this state
are given the opportunity to compete for the investment
administrative services business. Before contracting for any
investment administrative services with a provider that is not
either headquartered in this state or doing a majority of its
business in this state, the board of a school district or board of
an intermediate school district shall prepare and make available to
the public a detailed cost-benefit analysis justifying the
selection of the service provider. The analysis shall be prepared
utilizing accurate, reliable, and objective data and shall use the
soundest actuarial techniques that are available to the school
district or intermediate school district.
(3) (2)
The board shall not have liability
because of its
purchase of tax-deferred investments for employees.
(4) (3)
This section shall be applied in a
nondiscriminatory
manner to employees of the school district.
(5) (4)
As used in this section, "tax-deferred
investment"
means an annuity contract, interest in a mutual fund, or other
investment device that qualifies for deferral of federal income
taxes under the federal internal revenue code or other federal
income tax law.