I am deeply concerned about the pension reform framework recently made public.
These proposals challenge the contract rights of members, lower the standard of living of employees now and in retirement, and will worsen the cash-flow crisis in the state employee pension plan.
A state Supreme Court justice recently questioned the legality of freezing participation in the judicial pension plan at 27 years.
We share the same concern for Kentucky Retirement Systems members whose benefits also are covered by an inviolable contract.
The framework imposes a new 3 percent employee contribution to help fund health insurance expenses. State workers already are underpaid and losing ground every year.
Moreover, the KRS health insurance trust funds are a fiscal bright spot with improving cash flow and dramatically increasing funding ratios.
Finally, the conversion to a 401(k)-style plan will divert contributions from new employees from KRS to Wall Street. The legacy plans will still have to pay down the existing unfunded liabilities even as they are closed.
Yes, pensions must be addressed. The legislature failed in its duty to adequately fund pensions, with an inevitable result. We look forward to a vigorous discussion of revenue sources that address pension funding without betraying the promise to workers and retirees.
Jim Carroll
President,
Kentucky Government Retirees
531 Chinook Trl.
Frankfort, KY 40601
502-682-0196
What’s the point of posting an opinion piece complaining about proposed changes if one doesn’t also voice a response with different ideas to resolve this crisis? This man is a “President” of his organization, yet he provides readers with no solutions. Call me naive, but if I were affected by this crisis and aware that the current system will be bankrupt by 2022, then I would be praising Bevin’s plan.
It’s not a crisis, but the Governor has convinced Raul that it is. If the General Assembly will continue to fund the system as they have in the last budget, the pension system will be able to continue to pay its obligations and will be back on its feet in about 20 years. It takes that long to make up for the money the legislators “borrowed” from the system since 2000. A vast majority of the other states have the same type of pension system as Kentucky, and they are not destroying it like Kentucky is about to do.
I agree that the recent budget moves have helped to stabilize the system, but for how long? Kentucky’s pension was completely funded as recently as 20 years ago (which is recent when discussing compounding interest). Why would we want to be a recession away from total collapse when we have a chance to fix it forever? Even the most Liberal media coverage in Kentucky agrees that this IS a crisis – http://www.courier-journal.com/story/news/politics/2017/08/24/kentucky-pension-crisis-question-answers/549085001/
No ones likes getting their financial affairs in order, because it’s painful. In this case, the retirees and employees in our system need to know that we value their service and Kentucky will keep the promises that have been made!
There is no final bill with no financial analysis available to consider but most importantly there are absolutely no funds in pension reform bill-not even to replace and restore funds taken from retirement system. Therefore, the legislature has no credibility to solve a problem they helped create or understand the resentment by teachers, state employees, and especially elderly retirees who do not deserve and are not able to worry about their their monthly checks to pay their bills & health care.