LANSING – Growing contributions to the Michigan Public School Employees Retirement System are reducing what school districts can spend on other educational services and that effect is likely to continue for the near term, the Citizens Research Council said in a report released Wednesday.

The report, Funding for Public Education: The Recent Impact of Increased MPSERS Contributions, found that between inflation and MPSERS contributions, funds for other needs have fallen 13.1 percent for K-12 schools and 8.8 percent for all educational entities.

Pension contributions increased from 8.7 percent of school revenues in Fiscal Year 2003-04 to 14.8 percent of revenues in fiscal year 2011-12, the report said.

And those contributions are expected to continue climbing, the report said.

In FY 2011-12, average per-pupil funding was $8,213. Of that, $186 went to MPSERS. For FY 2014-15, based on consensus revenue estimates, average per-pupil spending would increase to $8,840, but MPSERS would take $527 of that.

The recent changes could help to contain MPSERS increases and stabilize contributions, the report noted.

“However, in the near term, the crowding-out effects of increased MPSERS contributions will remain, and state policymakers will need to continue to decide whether additional support is warranted to reverse some of their negative impacts on public schools,” the report said.

Climbing markets could also help to stabilize pension system contributions, the report said, noting that market losses in 2008 and 2009 contributed to the need for more cash from school districts to support the system. The fund’s value has yet to return to the heights it hit in 2000, the report showed, and was down $16.6 billion in 2011 from that index year. Of that loss, about $14 billion was from investments, with the rest from liabilities of the fund.

The MPSERS contributions are exacerbated by loss of students and related loss of funding, the report showed. There were 1.55 million students in the public schools in 2011-12, down from 1.71 million in 2003-04. And traditional districts have seen more decline, with charter school enrollment increasing to 119,900 from 73,473 over the same period.

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