Dementia, or Schoolcraft County's
Under-funded and Unfunded M.E.R.S.
Retirement Benefits and Premiums?



This article is one of a series of editorial articles that express personal opinions and views. They are written with no pretensions to be error free. I will gladly correct substantial errors of fact. My opinions can change, depending upon my awareness of changes in factual information. It is my intent to remain focussed on specific public issues, regarding the personalities involved. For all I know, all the characters are saints, concerning their private lives and other public business...

Changes may be requested by E-MAILing the details to


This evening, I attended the Schoolcraft County Audit and Finance Committee meeting, followed by the Schoolcraft County Board of Commissioners meeting. On the agendas, for both meetings, was an item of business concerning M.E.R.S. B2 and B4 retirement benefits, as requested by Commissioner "Lame Duck" Erickson.

County M.E.R.S. plan administrator, and Schoolcraft County Clerk, Sigrid Doyle, was present at both meetings, as was Schoolcraft County Treasurer, Terri Evonich.

In the audience were the two newly elected commissioners, Margaret "Pinocchio" Arnold, and Scott "Invisible Man" Chartier. Neither one offered any public comment regarding the business considered at the meetings of 11/10/04, or the M.E.R.S. retirement business considered at past meetings I have attended.

During the Audit and Finance Meeting, Commissioner Erickson repeated his continued concerns, about his understanding of an apparent fiscally irresponsible Schoolcraft County policy of paying M.E.R.S. retirement premiums at a lower B2 plan rate for current and retired, county employees, that will be, or are now collecting retirement benefits at a higher B4 plan rate. County Commissioner, Doug Erickson, repeated his past analogy, likening the mounting county M.E.R.S. retirement plan debt to the consequences of the irresponsible use of a credit card, where the debtor fails to pay off the principal owed and continues on a mindless spending spree towards a credit maximum, paying interest only, with no provision or intention to pay off the mounting principal debt.

Commissioner Erickson then referred to the Schoolcraft County M.E.R.S. "Annual Actuarial Valuation as of December 31, 2003" that showed, on page 15, based on 2003 M.E.R.S. plan premiums, the future retirement benefits of current union county employees were only funded at the 54.4% level, some $933,732 short of being paid "up to date". Given the unfunded debt of other Schoolcraft County M.E.R.S. plan retirement divisions, for other non-union groups of county employees, the total unfunded county M.E.R.S. plan premiums debt was close to $1.7 million.

Referring to the 2003 actuarial report, Erickson then stated that a pending 2004 report might indicate the current year's situation to be worse, because of the absence of a one time subsidy paid, in 2003, to all state M.E.R.S. accounts, by the M.E.R.S. corporate entity, because of an outstanding 2003 investment year.

After Commissioner Erickson's reference to the data in the 2003 M.E.R.S. actuarial report, a short discussion followed. During the discussion, Schoolcraft County Clerk, Sigrid Doyle, and Schoolcraft County Treasurer, Terri Evonich, concurred, with Commissioner Aldrich's paraphrased statement that "...until a few years ago, the Schoolcraft County M.E.R.S. retirement accounts were over funded..." Commissioner Aldrich suggested a County Board "M.E.R.S. meeting" to consider the merits of Erickson's concerns. The general consensus of board members was that such a meeting was appropriate. No action was taken regarding the time and place of a meeting.

No serious public concern was expressed, by anyone else, other than me, to Erickson's, irrefutable substantiated concerns. It was as if everyone else knew about a documented, unconsidered, unfunded, unexplained, and, possibly, expanding Schoolcraft County debt of $1.7 million was "business, as usual", worthy of no more concern than an indefinite commitment to consider the mundane business at some undetermined future date, after "deer season". It was, as if, more than Aldrich, Doyle and Evonich, at the County Board meeting knew about the deficit, and, other than Erickson, everyone's consensus was "Its no big deal!".

I sat stunned. With no verified knowledge of the debt's cause, or how long it took to accrue, or the rate at which it accrued, from zero dollars, I did a little mental arithmetic, while I witnessed the "shuck and jive" routine. I assumed a "few years" as 50 months, and divided it into $2 million. Assuming a linear expansion process, over 50 months, the debt would be expanding at a rate of $40,000 a month.

The Schoolcraft County Board of Commissioners were more interested in "beer camp" than where the money was to come from to pay a substantial bill, of questionable causes, that was expanding at an unknown rate! I concluded, again, that the majority of the board must know more than was obvious to me, because of the relative indifference to Commissioner Erickson's report, and the fact that Commissioner Aldrich, the County Clerk, and the County Treasurer admitted that they were all aware that the M.E.R.S. plan had gone from over funded to under funded in a "few years".

What's to worry about? We know! It's time for deer camp! It was time to zip my lips regarding any speculation about the nature of the deficit. There is more important business in Da U.P., Eh?

I do not remember Schoolcraft County Board Chairman Frenette saying a word, regarding the details of the apparent M.E.R.S. debt, at either meeting. I assume he knew about it, also.

As a consequence of Commissioner Erickson's enlightening presentation, I had two questions for the Schoolcraft County Board during the following public comment period. They are paraphrased below.

1. Is the B4 retirement option, that you have referred to, before, a county employees union contract term that applies to all county employees?

2. Do current M.E.R.S. premium payments include paying off the $1.7 million debt?

The discussion that followed got a little heated. I felt my blood pressure, and likely, my voice, rise as I responded to the following display of evasion of those that have the fiduciary responsibility for a candid and responsible county M.E.R.S. county employee retirement plan process.

Schoolcraft County Clerk/M.E.R.S. Administrator/County Board Secretary/..., Sigrid Doyle, answered my first query. She said, in so many words, that the option to retire at a B4 benefit rate, applied to all retiring union employees that chose to retire within 3 "window" time periods, in a five year period, as specified in the county employee union contract. She then implied, in a fashion that I do not remember well enough to quote, that M.E.R.S. had 4 billion dollars from which to pay the Schoolcraft County employee B4 union contract retirement benefits.

My response, in an attempt to draw out more revealing information, and to vent my disgust with what I witnessed, pointed out that a union contract entitlement, for all county union employees, to retire with unfunded B4 benefits, was something I had great difficulty believing was appropriate, considering the past and current fabrication I had heard regarding the issues. Other than Sigrid's vague claims of a union employee entitlement to unfunded B4 retirement benefits, no specific reference had been provided for B4 union retiree entitlements, and no concern had been voiced by anyone, other than Commissioner Erickson, and I, concerning a substantial growing unfunded county $1.7 million retirement premium debt.

After I voiced my disbelief, Commissioner Aldrich chose to close that discussion by stating that a future public M.E.R.S. related County Board meeting would be the appropriate place for further comments.

My second question was met with no other answer, other than Commissioner Aldrich referring me to a yet-to-be-determined public M.E.R.S. related County Board meeting.

During the following public comment period, of the subsequent Schoolcraft County Board of Commissioners meeting, Commissioner Erickson chose to address my second question from the previous audit meeting. He stated, again, that the 2003 actuarial report indicated that current employer contributions (of Schoolcraft County) were only funding union contracted projected benefits at the 54.4% level.

I could only assume, from the manner in which he chose to answer my prior question, that he was prompting someone present, with the direct responsibility for the knowledge, to answer my question. No one spoke up, so I conclude that no part of current M.E.R.S. premium payments goes to reduce a $1.7 million premium payment deficit that is likely increasing.

If, as the County Board meeting of 11/10/04 indicated, everyone knew about the deficit, or were relatively unconcerned, other than Commissioner Erickson, why my total ignorance until that evening? How could an unfunded public county debt of $1.7 million accrue with no public knowledge? What more was hidden?


Today, I heard, on WTIQ radio news, a report that implied that the unfunded B4 benefits, would be a likely problem, five or ten years from now, if nothing is done.

Regardless of the content or intended meaning of the news story, Commissioner Erickson provided the substantiated figures that show that, on 12/31/03, Schoolcraft County had a growing $1.7 million dollar unfunded retirement pension premium debt, and if funded today, with future tax revenues, then goods and services that would be purchased with that $1.7 million, will not be available to the taxpaying community that must pay for past unfunded M.E.R.S. retirement premiums. To a Schoolcraft County budget, plagued by the consequences of declining revenues, a growing unfunded $1.7 million debt is a problem, today. Whether it is a problem, five or ten years hence, depends on the will of the Schoolcraft County Board of Commissioners to deal with the cause and effects, today.

If the impact of paying a mounting accrued 2003 M.E.R.S. debt of $1.7 million, unconsidered in the 2004 budget, and ignored, for "several years", by a majority of commissioners, until yesterday, is not a problem for 5 or 10 years, then lets give public accolades to those that created the non-problem, and ignored the non-problem; and get rid of Commissioner "Lame Duck" Erickson, tomorrow, for his today's attempts to prompt his fellow commissioners to deal with today's growing $1.7 million county M.E.R.S. unfunded retirement premiums debt.

11/17/04, Original date of the following section
11/20/04, Some technical details updated or corrected
11/23/04, Added content

Consideration of some of M.E.R.S. related information, most of it "public knowledge", leads to some interesting insight to the motives, means, goals, ethics and professional abilities of those with the responsibility to keep the County's M.E.R.S. retirement obligation, justifiable and manageable. The true extent of Schoolcraft County's liability for current and future retirement benefits may extend far beyond County Clerk Doyle's statements that imply that "M.E.R.S. Inc's" billions will keep the county happy. Based on reasonable guesstimate calculations, based on static variables, and the relatively safe assumption that the union's B4 or B2 benefits apply to a worker's life time earnings:

If there is no funding of Schoolcraft County M.E.R.S. plan Division 01 B4 benefits, as I fail to find and understand in the 2003 actuarial report, and if there are 39 Schoolcraft County Division 01 employees, and all retire at 30 years with B4 benefits based on $25,000 yearly wages, each would draw:

$25,000 x 30yrs x 2.5% /12months = $1,562.50 per month retirement at a B4 rate

$25,000 x 30yrs x 2.0% /12months = $1,250.00 per month retirement at a B2 rate

The financial liability to Schoolcraft County, to date, for the past 5 years since 1999, when the B4 benefits became a Division 01 right by union contract, i.a.w. current Article 44, is:

$1,562.50 - $1,250 = $312.50 per employee, per month x 39 employees x 12 months = $146, 250 x 5 years = $731,250 unfunded cash liability, today; for 1999 through 2004, only.

For each month the County Board sits on its hands, by my guesstimate, today, the County is accruing a monthly unfunded Division 01 B4 benefit debt, from 1999, of $146,250 /12 = $12,187.50, and that does not consider non-Division 01 county employees that may have the right to retire, or have retired, with unfunded "B4" linked benefits.

To me, the real scary part of the Division 01 union contract B4 benefit, and the current system of accounting and accountability, is that it has been rumored, to me, that B4 benefits apply to a retiree's lifetime wages, not just those earned from 1999 to date. If that is the case, and current M.E.R.S. premium payments do not include funding for any B4 benefits, the unfunded cash liability, for B4 benefits alone, today, is unknown millions.

An unknown millions guesstimate would be, based on my previous guesstimate basis, for 39 Division 01 retirees, with an average of 18 years of employment, to date:

$731,250 x (18/5) = $2,632,500 of "known" unaccounted unfunded B4 retirement premium debt, accruing at a rate of $12,187.50 x (18/5)= $43,875 each month! And Commissioner Aldrich "knows" it?

Keep in mind that the previous guesstimate are based on my logical assumptions, minimal knowledge, and less than perfect arithmetic skills, and ... the numbers do not include any effort to include funding for an apparent existing known premium deficit of $1.7 million. If I am anywhere close to correct, in my many justified assumptions, a lot of folks should be living on bread and water.

The thumbnail calculations and tentative conclusions I have reached, show a current total unfunded county M.E.R.S. pension cash liability of $1,700,000 + $731,250 (For a known 5 years only) + the $X hidden payments being made for the unfunded benefits of past employees, including the unethical, if not illegal, retirement benefits of certain sitting and ex-Schoolcraft County commissioners. How the B4 benefit rate applies to retiring non-union personnel, I have only hearsay for reference. From what I have been told, all benefits apply to all members of any particular M.E.R.S. plan division. Schoolcraft County's M.E.R.S. plan, Division 01, has a combination of union and non-union employees, the consequences of which provides non-union employees with union bargained benefits, without the payment of union dues, or contracts that include B4 benefits.

I cannot imagine any non-union county employee retiring from Division 01, with B4 benefits, being forced to give up that which they may not be due. Perhaps the County Board wishes to make it a recognized and funded benefit, now, assuming it can tie up more future tax revenues for more deficit spending to purchase past premiums and future premium obligations for benefits that I do not think were contracted for, by any non-union county employee; or paid for by the county.

I hope that County Clerk Doyle can find the County Board minutes to appropriate funding for the retired commissioners that are collecting, today, significantly more than their deficit spending of future tax revenues cover. I hope she can find the County Board minutes to appropriate funding for union B4 M.E.R.S. benefits that are specified in Article 44 of the A.F.S.C.M.E. union contract. I hope she can find the County Board minutes to appropriate funding for non-union B4 M.E.R.S. benefits that she implies are due, and hopes to collect, along with other non-union county employees.

I hope that the mess I perceive is not another case of the "emperor's new clothes" that only I fail to see. Perception is everything, and it is often based on a perspective that distorts the "big picture". Magicians know about such things.

From my perspective, it was self-serving genius, for the county administrator of the Schoolcraft County M.E.R.S. plan, to place most non-union employees in the same division as union workers. The county administrator of the M.E.R.S. plan is non-union, and she, like all other non-union county workers, will be, or hope to be, collecting B4 benefits that are, to the best of my knowledge, no part of any non-union contract, and have never been paid for. Sounds like another "free" retirement benefit package, for full time county employees, this time, rather than commissioners, and some of their select acquaintances.

What I haven't figured out, to my satisfaction, yet, is what benefit accrued, and to whom, when most county department heads and commissioners, were removed from Division 01 and placed in Division 20, of the county's M.E.R.S. plan. Division 20 had only one member, Schoolcraft County Sheriff, Gary Maddox, and no B4 benefits. Why would the major county employees be moved from a division that would, supposedly, give them a legitimate retirement claim to Division 01 B4 benefits, and be placed in Division 20, where a basis for B4 claims does not exist?

The only "reasonable" conclusion I have reached, to date, is that moving department heads and commissioners, from Division 01, to Division 20, was an effort to slow the accelerating decrease in Division 01 equity, relative to that division's current and near term retirement liabilities. I suspect, but I do not know, that a County funding level of 54.4%, for Division 01, was close to prompting some up close, and personal, "M.E.R.S. Inc." scrutiny of Schoolcraft County financial decisions that lead to an equity deficit of 45.6%, while "minimum required contributions" were being made. Shuffling current benefit liabilities, and near term major unfunded or under funded liabilities, out of Division 01, would reduce that division's debt load, and move it elsewhere, where its impact, in the near term, would draw less attention, due to the current higher equity, in Division 20.

The ability to shuffle county employees, into and out of divisions, provides a potential mechanism of reward and punishment, for the county M.E.R.S. plan administrator. That potential becomes apparent when one considers a distinct minority of non-union Schoolcraft County employees that are not in Division 01, or any other division that provides B4 benefits, and, consequently, will not share in the "expected" unfunded B4 benefits available to the majority. I know of no objective difference between the majority of non-union workers, that are in Division 01, "eligible" for B4 benefits, and those in Division 10, for example, not eligible for "B4" retirement benefits.

When, in my relative ignorance, I look at the mix of current Schoolcraft County employees, as they are divided up in the various divisions of the county's M.E.R.S. plan, I can make no rational sense of most of what I perceive. It is as if personal whim determines the mix of personnel, divisions and expected benefits.

Based on my vague and unsubstantiated awareness, unfunded B4 benefits, identical to the union employee's B4 benefits, somehow accrue to a majority of non-union personnel, but not all. I look forward to County Clerk Doyle's cogent explanation to dispell the obvious ignorance and misunderstanding I have.

Commissioner Aldrich said, on 11/10/04, in so many words, "I know"... about the under funding.
I ask, 11/17/04, "You do?" "Really?" "Then what do you know that justifies the evasion, fabrication and delay, regarding the County Board's responsibility to deal with Schoolcraft County's M.E.R.S. plan equity deficit?"
How about Schoolcraft County Commissioner Frenette? As Chairman of the Board, with a vested interest in M.E.R.S. affairs, I expect him to know more; but I have heard nothing, since his revealing statement of 07/17/04 when Frenette said "It was no big deal.", and that everything had been done in public with an actuary's approval.

I guess I will have to wait until after deer hunting season, before my fanciful speculation is dispelled by the wisdom of those that are paid to know about such arcane matters. Maybe I will be made aware, by those that know better and have remained silent, for years, why my own understanding is wrong, fanciful, and unwarranted speculation and fabrication. For the sake of Schoolcraft County, I hope that what I perceive is the consequence of my overheated imagination, prompted by my gross ignorance and the fact that only one public official has been candid about his perception, regarding M.E.R.S. matters.

I remember sitting in public silence, while watching the "shuck and jive" routines between ex-Manistique City Treasurer Linda Armock and the Manistique City Council and City Manager, and understanding, consequentially, that there were serious problems regarding the accounting methods of the City of Manistique. I was right.

I have the same feeling, while watching similar evasive "shuck and jive" routines between Schoolcraft County Clerk Doyle, and the majority of the Schoolcraft County Commissioners. I have no reason to believe that all is right in "Pleasantville", and until I hear rational explanations for that which trips my "Baloney Alarm", I will not be silent, in public, this time.

My public silence, last time, perpetuated corrupt accounting procedures that led to an accounting nightmare and embezzlement, for the City of Manistique. Those that I spoke to, in private, had their own perspective of the situation, colored by their personal interests in city government, that superceded appropriate accounting and governmental procedures. Regarding County M.E.R.S. financial issues, I see public officials with similar attachments to personal interests that supercede appropriate governmental and accounting procedures. Whether I am "right" or "wrong", I am willing to justify my position, in context, in public, and let the Devil take the hindmost.

I heard a rumor that Schoolcraft County Clerk/M.E.R.S. Administrator/County Board Secretary, Sigrid Doyle, has found fault with my 11/10/04 public statement that I had little to no reason to believe her fabrications.

I've shown my reasons for my disbelief. I hope that the County Clerk show me hers, for the unsubstantiated "All is well!" stand she has taken, over the years, while Commissioner Erickson was ignored, misled and subsequently hung out to dry for public display, by deceivers that had no use for the honest and conscientious job he was elected to do.

I said fabrication, and I meant it.

I do have reasons to consider one rumored statement, attributed to the County Clerk, as true. "It's all ancient history. Nothing is to be gained by turning over rocks."

How true. So far, for Commissioner Erickson and I, it has been all pain, and no gain, while wondering, "Is it we that suffer dementia, or everyone else?".

It is still "Pleasantville"...

Some Schoolcraft County M.E.R.S. related benefit and financing information.

 © 2004