The Republican-led Michigan Legislature is advancing a portion of the $55 billion state budget.
House-Senate conference committees are expected to approve the budget for universities and community colleges on Tuesday.
Lawmakers want Governor Snyder to close the pension system to newly hired school employees.
Snyder opposes the proposals, saying it would be too costly.
Republican lawmakers designated $475 million to cover transition costs to move to a 401(k) only system in the first year.
The stalemate may delay the approval of the spending plan.
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