Plan proposed to fix pension crisis

With Senate President Robert Stivers and House Speaker Jeff Hoover by his side, Kentucky Governor Matt Bevin announced on Wednesday a 10-poiint plan to save Kentucky’s pension system for teachers and other state retirees.

“Nothing is changing for retirees,” Bevin said during the press conference.

The 10-point plan included:

  1. The pension plan will save pension systems while meeting legal and moral obligations owed to current teachers and state workers.
  2. Requires full payment of ARC and creates a new funding formula that mandates hundreds of millions more into every retirement plan, making them healthier and solvent sooner
  3. For those still working: no increase to the full retirement age, and current defined benefits remain in place until the employee reaches the promised level of unreduced pension benefit
  4. For those retired: No claw backs or reductions to pension checks, and healthcare benefits are protected
  5. For future, non-hazardous employees and teachers: enrollment in a defined contribution retirement plan will provide comparable retirement benefits
  6. For current and future, hazardous employees: will continue in the same system they are in now
  7. Closes loophole to ensure payment of death benefits for the families of hazardous employees
  8. Stops defined benefits plan for all legislators, moving them into the same defined contribution plan as other state employees under the jurisdiction of the KRS board
  9. No emergency clause: law will not go into effect until July 1, 2018
  10. Structural changes should improve the Commonwealth’s rating with credit agencies, which have downgraded Kentucky’s rating, citing unfunded pension burdens

The announced plan addresses the administration’s efforts to draft a bill that will be brought to both the House and Senate for a vote in the near future during a special session to be called by the Governor. A special session is a minimum of five working days for Kentucky’s senators and representatives.