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Col Owens: NKY Chamber wrong on pension bill; the crisis represents a long failure of leadership


I have often lauded the NKY Chamber of Commerce for its leadership in our community. But I was disappointed to learn of its position regarding SB1, the bill to address the pension crisis.

The Chamber asserts that the state does not have enough money to fund its pension obligations – obligations under law. It proposes that to put state pension systems on a more sustainable track, more of the burden must be placed on beneficiaries and less on taxpayers.

Putting aside for the moment the question of whether these actions would violate the inviolable contract, which the Attorney General believes they do, they clearly violate common sense and fairness.

Col Owens

Teachers and other public employees have never failed to pay in their share of their pension obligation – which for teachers amounts to close to 13% of their salary. Yet for years the legislature has failed to honor its obligations. Adding insult to injury, it has diverted funds paid in by teachers for their pensions to other, unrelated obligations.

Over a decade ago William Fox, a noted tax expert, was commissioned by the General Assembly to perform an in-depth analysis of Kentucky’s tax system. He concluded the state had a serious “structural deficit,” a built-in failure of its revenue structure to meet its lawful obligations. Yet nothing was done.

Since then lawmakers have repeatedly complained about not having enough money, but they have never summoned the will to re-structure the system to generate the needed money.

Consequently, the situation has continued to deteriorate. It was intensified by the Great Recession, from which many average Kentuckians have never fully recovered – those who have not seen a raise for a decade, those working at full time jobs for below poverty wages – and those working for less pay as a trade-off for a secure pension. These now see that deal about to be broken.

There is a crisis because our leaders have failed to lead. They have failed to be honest, about what needs to be done, and their unwillingness to do it.

We all want our children to be successful and productive members of society, to have a better life than we have. We say we want good schools, both for our children and to prepare our workforce. But we are not willing to pay for them. Thus, teachers must pay for supplies out of their own pockets. The disparity between rich and poor school districts in their ability to provide local support to their schools is almost as extreme as it was before Rose v. Council for Better Education was brought.

We need more revenue. More revenue to pay for services we need to secure the standard of living and quality of life we want. We should review existing tax abatements and exemptions, to eliminate those not serving a useful public purpose. The revenue we do not collect because of them is greater than the revenue we do collect! We should also review our sales tax base, which is not following the shift in our economy from goods to services. We need to adopt legalized gambling, even if we are late to the game. The cigarette tax is a no-brainer. The Chamber already supports the latter two.

Leaders must lead. They must have the courage to muster the facts, determine their meaning, and report that honestly to their constituencies. To fail to do that is to fail to lead. When the history of this period is written, it will clarify that in sad detail.

But this posture of things can be reversed. The Chamber needs to take another look, with a more inclusive view of all the facts. I am confident if it does, it will reach a different conclusion.

Col Owens is a retired Ft. Mitchel attorney.


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6 Comments

  1. Marv Dunn says:

    Mr. Owens is spot on here. The Commonwealth needs more money. Our Legislature has too long been under the influence of Grover Norquest, ALEC and the Chamber.

  2. James says:

    The Colonel is correct, the revenue stream via taxes is based incorrectly on a goods based economy and there is very little leadership to make the required adjustments.
    The last 20+ years of elected and appointed officials have failed to fulfill their law-binding financial obligations to the pension system, yet somehow their elected position pensions were made “safe” and almost 100% funded.
    I admire the governor’s attempt to take the lead on this,( knowing that it may be political suicide) and attempt to make some very necessary yet painful decisions. What is very irksome is that we had so many other elected officials (please note I don’t use the word “leader” here), continue to fund pet projects and borrow money for the state’s other “obligations” yet let pensions fall by the wayside.

  3. Debbie says:

    Finally!! Someone with the voice of reason! You have it right!!!

  4. Debbie says:

    Please send this to the River City News and the Enquirer. They don’t seem to have gotten the word yet. They are still very one sided!! Wish we could get you on the television too!!!

  5. Patricia Brooks says:

    Finally, someone in Northern Kentucky supporting public education!

  6. Beverly says:

    Casino gambling is, indeed, late to the game. However, some money is better than none. It’s an eye opener to go to casinos in states bordering Kentucky and see so many cars with KY license plates.

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