Attend Court of Appeals Hearing on Taxing our Pensions
Hello MEA Retirees and Future Retirees –
Okrie v State of Michigan Oral Argument, Tuesday June 7, 10 a.m. Hall of Justice, Second Floor, Lansing
Please help us fill the courtroom next Tuesday, June 7
when the Michigan Court of Appeals will be hearing oral argument in the Thomas Okrie v State of Michigan
case. Details about the case and the oral argument, parking, and other details are in the attached flyer. To view the flyer click here
Here’s some background:
Recall that in 2011 newly elected Governor Rick Snyder proposed and the Legislature adopted a major overhaul of Michigan’s income tax structure. The Small Business Tax was abolished for 95 percent of businesses in Michigan – 86,000 businesses – and a 6 percent flat Corporate Income Tax was established only for corporations, not LLCs, partnerships, C-corporations, and other entities that were taxed under the former SBT. There were no strings attached to these tax changes and it is impossible to know if even one new job was created because of the abolishment of the SBT.
Since the new CIT did not generate enough revenue to replace the SBT, other sources of revenue were sought. The biggest tax expenditure on the books at the time was the exemption of pensions and some retirement income from Michigan’s income tax. Under the new law, effective January 1, 2012, retirement income of those born after 1945 would be subject to the income tax.
Other tax credits were abolished also. The total tax shift from business to individuals amounted to $1.8 billion, about $540 million of it straight from the pockets of seniors and younger retirees. Please make every effort to attend the hearing in the Michigan Court of Claims on Tuesday
, June 7in Lansing.. Click here for details and directions.
Thomas R. Okrie was a retired public school teacher who was personally outraged at the Governor and the Legislature for imposing the pension tax. He hired attorney Gary Supanich to bring a legal challenge. A class-action lawsuit was filed in July 2013 on behalf of Okrie and similarly situated retired state and public school employees (over 100,000 people), challenging the State of Michigan’s action of taking away their deferred compensation in the form of tax exemptions without providing comparable financial benefits to them. The lawsuit principally alleged a breach of contract under state law, or an impairment of contract and “Takings” in violation of the state and federal constitutions.
After the filing of the Okrie lawsuit, the Legislature and Governor also changed the court system to take the authority away from the liberal Ingham County Circuit Court judges to hear cases against the state and reassigned them to a newly established panel of Court of Appeals judges. The Okrie case was cited by court watchers as one of the reasons for this re-organization. Okrie challenged the constitutionality of the court re-organization and lost. He also lost his case-in-chief in front of the new panel and appealed to the Michigan Court of Appeals. Now, nearly three years later on June 7, the Michigan Court of Appeals will be hearing oral argument on the Okrie pension tax challenge.
We need to fill the courtroom with retirees – the grayer the hair and more wrinkled your skin the better – to show we have not forgotten our anger over the pension tax. Whether you were born before or after 1945, you are invited to show up at the Hall of Justice at 10 a.m. on Tuesday, June 7 to show your support for this class action lawsuit.
Thank you so much for your past support and interest!
Michigan State Employee Retirees Association