Major reforms recommended for Ky. pension plan
FRANKFORT, Ky. (AP) — A panel of lawmakers has heard recommendations for reforming Kentucky's public pension plan in an effort to make it solvent.
The Courier-Journal and the Lexington Herald-Leader report that the options were presented Monday to a state task force by the Pew Center on the States and the Laura and John Arnold Foundation. Their recommendations included decreasing tax credits, issuing pension bonds, requiring bigger employee contributions and paying out less to future workers.
The state's pension systems are facing unfunded liabilities of $33 billion. Lawmakers say they hope to pass a reform effort during next year's legislative session.
"While the choices will be hard, ultimately this is a solvable problem," the Pew Center said in its written report to the task force. "But if Kentucky continues to delay, it could become an unmanageable crisis. This task force has the chance to make a real, lasting improvement in Kentucky's fiscal health and put the commonwealth on a credible path towards closing its funding gap."
Democratic Rep. Mike Cherry of Princeton co-chairs the task force and said members will discuss options and vote on recommendations late next month. He said lawmakers thought they had addressed the pension shortfall with legislation passed in 2008, but those changes have been inadequate to address the problems.
Some lawmakers said they are hesitant to change retirement benefits or ask workers to contribute more pay.
"We don't want to hit the employees any harder than they've already been hit. If we do, we're going to lose our employees," said Rep. Brent Yonts, D-Greenville.
Republican Sen. Damon Thayer of Georgetown, who co-chairs the panel, said it's not reasonable to ask taxpayers to pay more to finance public pensions that are better than many have in the private sector.
"The taxpayers who fund public pensions ... we have to be cognizant of their role in this equation," he said. "We've got some tough decisions to make."