The Kentucky Senate has passed a bill that would reform the majority of the state's pension system. Senate Bill 2 contained the recommendations of a legislative task force on the underfunded pension system. It suspends cost of living adjustments and creates a hybrid, 401k-style pension plan for new hires.
Bill sponsor Damon Thayer says the bi-partisan support for the bill shows the need for continued cooperation on pensions.
"This is not a perfect bill. There are certainly other ways that this can be done," Thayer said. "But in this town and in this building, when have we ever given up the good for the sake of the perfect. This is a good bill, Mr. President."
State lawmakers return to Frankfort today to take on some of the Commonwealth's most pressing issues, including finding a way to shore up the financially troubled pension plan for government retirees. The Legislature met for a week in early January to elect House and Senate leaders, then took a three-week break.
Kentucky legislative leaders say solutions on how to pay for Kentucky’s underfunded pensions won’t likely be addressed in the 2013 legislative session, which began Tuesday.
Both House Speaker Greg Stumbo and Senate President Robert Stivers say there will likely be a bill to introduce changes to the pension systems. But they also agree that such a bill is unlikely to deal how to fund the changes.
What they do disagree on is when to deal with the funding solutions. Stumbo says pension funding should be dealt with in a special session, hand in hand with tax reform.
Kentucky lawmakers start their legislative session today where they're expected to consider tax reforms and search for ways to shore up the financially troubled pension system for government retirees. A task force appointed by Gov. Steve Beshear has recommended a series of changes to the state tax code that could generate more than $600 million in additional revenue. A separate legislative task force has recommended pumping more money into the pension system, which has a $33 billion unfunded liability.