LANSING (WKZO) -- The state senate passed reforms to the Michigan Public School Employees Retirement System that will shrink more than 15-billion dollars in unfunded liabilities facing the system. The bill increases employee contributions as well as prefunds retiree health care beginning in the upcoming fiscal year 2012-2013.  Prefunding means that the state will now be setting aside money to meet the debt when it comes due in the future.