By Tom Latek
Kentucky Today
FRANKFORT, Ky. (KT) – Questions and issues still remain about the proposed public pension reform bill released to lawmakers last week.
House Speaker Jeff Hoover, R-Jamestown, said: “We’re hearing from constituents who are concerned about the three percent on health insurance (and) also, the re-employment issue.”
He was referring to a new requirement that three percent of public employees’ pay be used to help pay health insurance for future retirees and the practice of retiring from state government, then returning for additional retirement benefits.
Another question is how many votes in the House are needed for passage, a simple majority with at least 40 “yes” votes of members present, or if more than 50 are necessary.
“I really don’t know if it requires 40,” Hoover said. ”Whatever is out there, we’ll have more than 40 votes. There’s no question of that.”
The Speaker said he is sharing his members’ thoughts with Gov. Matt Bevin and Senate leadership on possible amendments to the legislation.
“We’re not talking about changing the whole thing,” he said. “We’re talking about addressing two or three things that we’re hearing a lot of comment on.”
It appears the public pension plan will have an easier time in the Senate.
“We have the votes to pass the bill,” said Senate Majority Leader Damon Thayer, R-Georgetown. “But I think there are a couple of tweaks that can be made. The same ones Speaker Hoover has mentioned.”
Thayer warned that “If we don’t pass this pension bill, or at least something very close to it, there are going to be some really tough votes coming up in the next session. We are looking at double-digit cuts across the board in government. I think it’s pretty well accepted that there are going to be cuts across the board. It’s just a matter of how deep they are.
“These are dire circumstances we find ourselves in. I give the Governor a lot of credit for not avoiding this issue like previous governors have done. He’s willing to take on arguably the toughest issue that we’re ever going to have to deal with.”
The legislation, which runs 500 pages, was released to all 138 state lawmakers Friday night, some of whom put it online.
It calls for new employees and teachers to be placed in a 401 (a) defined contribution plan. Current employees would keep the defined benefit plan, but it’s capped at 27 years of service, moving them into a 401 (a). Teachers who currently have 27 or more years of service have a three-year window before they would be moved into a defined contribution plan. Cost-of-living adjustments for retired teachers would be frozen for five years, and there is a requirement for an additional three percent of salary to help pay for future retirees’ health insurance.
More than 11,000 Kentucky teachers are eligible to retire and some have warned during forums put together by the Kentucky Education Association that they are considering retiring before the reforms would take effect.
Fixing Kentucky’s public pension systems, considered one of the worst-funded in the country, has been a priority for Bevin. The unfunded liability could be as much as $60 billion.
Both Hoover and Thayer still believe Gov. Bevin will call a special session to act on the bill from now until the end of the year, although they are unsure when the call will be issuede.
Although Republicans have supermajorities in both chambers House Majority Whip Kevin Bratcher, R-Louisville, earlier this week said it wouldn’t be an easy task to pass the legislation.
“There’s a lot of misinformation out there,” he said. “A lot of people don’t understand the bill. It is complex. This isn’t a slam-dunk by any means. It’s going to be a challenge.”
House Republicans will meet again on Friday to discuss the bill.