Attorney for Stumbo claims public pensions don't receive tax dollars in attempt to get TV ad pulled

10/26/2016 05:40 PM

An attorney for House Speaker Greg Stumbo argued in a cease-and-desist letter sent Wednesday that an ad airing against him on WYMT-TV in Hazard should be pulled, in part, because public pensions aren’t funded with tax dollars.

The assertion drew a rebuke from the chairman of the Senate’s budget committee, who said he hoped the correspondence was sent without Stumbo’s review because the speaker “obviously knows better.”

The ad, launched by the Republican State Leadership Committee on Tuesday, focuses on Stumbo’s pension and the effects of 2005 legislation dubbed the “greed bill,” which allows lawmakers to combine their years of service and highest salaries in all branches of government when calculating their retirements.

The RSLC, citing a study by the conservative-leaning Bluegrass Institute, says in its 30-second TV spot that Stumbo is set to earn $1.2 million over his lifetime once he retires from public office.

Pension information is exempt from Kentucky open records laws. The Lexington-based think tank estimated Stumbo’s public retirement windfall based on his years of service in the legislature plus his four years as attorney general, when he earned $100,346 annually.

Anna Whites, Stumbo’s attorney, cried foul in a cease-and-desist letter on Tuesday, but WYMT continued airing the ad.

That prompted a second letter from Whites on Wednesday. She questioned supporting documentation provided by RSLC, said Stumbo, D-Prestonsburg, did not vote for the 2005 legislation since he was attorney general at the time of the bill’s passage and said the speaker does not earn six figures as a lawmaker.

“Further, there is no taxpayer money involved in the pension,” she wrote. “The pension is funded by its members, like all pensions. There is nothing in the supporting materials that indicates any taxpayer responsibility for pension coverage. That statement is blatantly false.”

But Sen. Chris McDaniel, a Taylor Mill Republican who chairs the Senate Appropriations and Revenue Committee, says it’s Whites who’s mistaken.

“In every pension system that we have, there is taxpayer money that goes towards that benefit,” he said in an interview with Pure Politics in the Capitol Annex on Wednesday.

The General Assembly approved a two-year budget in April that pumped more than $1.2 billion into the Kentucky Retirement Systems and Kentucky Teachers’ Retirement Systems as part of its employer contributions and to amortize billions more in unfunded liabilities, not to mention employer contributions to the Judicial Form Retirement System that covers legislators and judges. That’s also on top of amounts withheld from employees in the systems.

“Obviously whoever the attorney is that wrote this letter is simply misinformed because it bears very clear in every budget that we write that we send taxpayer dollars to the pension systems,” McDaniel said.

When asked about the state’s contributions into the pension systems, Whites wrote in an email, “Our response would be that the state makes the typical employer contribution, as any employer does. Such contributions are a part of any employment package.”

In response to a follow-up question about the source of the state’s contributions if not from tax dollars, Whites reiterated her point but avoided talk of taxes.

“Our position would be that this is the same contribution mechanism that serves all state employees,” she told Pure Politics in an email.

“Our legislators have a unique job that requires a huge personal investment in time and effort by the legislator and family members. The state contribution is part of the appropriate and commercially reasonable employment benefit.”

The RSLC also unveiled a website, StumboGreed.com, on Wednesday as part of a corresponding digital advertising effort in Stumbo’s race.

“While the state’s teacher’s pension plan nears bankruptcy and while jobs in his own district in eastern Kentucky continue to vanish, Speaker Stumbo’s handsome payday remains intact,” RSLC President Matt Walter said in a statement. “Even though he’d prefer not to talk about this politically inconvenient reality, his voters deserve an explanation.”

A copy of Whites’ cease-and-desist follow-up letter can be downloaded here: Whites cease and desist follow.pdf

A copy of RSLC’s response to the initial cease-and-desist letter can be viewed here: RSLC response to cease and desist.pdf

Kevin Wheatley

Kevin Wheatley is a Video Journalist for Spectrum News and covers Kentucky politics and all the goings-on at the State Capitol. Kevin was born and raised in Frankfort so he grew up around politics and has always had the drive to follow the political process and hold lawmakers accountable. Before joining Spectrum News Kevin covered government and politics for The State Journal in Frankfort. You can watch Kevin’s work weeknights at 7:00 and 11:30 on Pure Politics, available exclusively on Spectrum News, HD Channels 403 and 715. You can reach him at kevin.wheatley@charter.com or 502-792-1135.

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