Gov.-elect Bevin will work to enact pension legislation as "expeditiously as possible," eschews political strategy in appointments

11/20/2015 04:33 PM

LEXINGTON — Getting the state’s underfunded pension plans for public employees and teachers back on solid financial footing will take “a generation,” Gov.-elect Matt Bevin told an audience of local officials at the annual Kentucky Association of Counties conference Friday.

Pensions were one of a handful of policy points Bevin discussed in his remarks at the conference’s conclusion, which comes amid reports from The Courier-Journal and Lexington Herald-Leader that the Kentucky Retirement Systems dropped to a 19 percent funded status.

KRS’s unfunded liabilities grew by nearly $2 billion, according to the newspapers.

Bevin pitched his plan to convert the state’s retirement plan to a 401(k)-style defined-contribution pension for future workers and teachers, the latter of which would likely necessitate Social Security eligibility for teachers.

“For those people not yet hired, they are going to have to come in to a very different plan than that which has been offered to each of you and has been promised to each of you and to those who are already retired,” he said.

“To do anything less than that is to ensure that those to be hired, those currently working and those who have retired, none of them will get what’s promised to them if we don’t do what I’m saying.”

Moving from a defined-benefit plan for teachers and a hybrid cash-balance plan for state workers currently would cost more “in some measure at the front end,” Bevin said, “but if we know we need three or five dollars coming out and we only have one going in, that’s already a broken system.”

Speaking to reporters after his remarks, Bevin said his first priority is completing his transition into the Governor’s Office before shifting his attention to specific legislation regarding public pensions.

He acknowledged that legislative action may not happen as quickly as he’d personally like.

“I’m also a pragmatist, and I understand that simply desiring something or even knowing for a fact that is has to happen but trying to jam it more quickly through a process than is possible serves no purpose,” Bevin said. “And so we will be thoughtful, we will be methodical, and we will attempt to enact this with enabling legislation as absolutely expeditiously as possible. If we can do it in this session, it will be done in this session.”

Jim Carroll, co-founder of Kentucky Government Retirees, said his group is concerned with Bevin’s proposal to shift new hires to a defined-contribution pension.

“We hope he will shelve this idea for a future time so that all implications can be thoroughly studied,” Carroll said in a statement.

“We hope he will instead concentrate his energies in the 2016 session on finding a funding solution to rescue the KERS non-hazardous and State Police funds. As stakeholders, we are eager to serve as active partners with Gov.-elect Bevin and other Frankfort decision-makers in this critical task.”

Bevin’s legislative agenda would likely have a better chance in a Republican-controlled General Assembly. With former Democratic Rep. Denny Butler’s conversion to the GOP column, the Democrats’ majority dropped to 53-47.

Although rumors of other flips have been plenty, so too is speculation that Bevin could appoint Democratic representatives to administration jobs in Republican-friendly districts.

That’s a tactic most recently attempted by Gov. Steve Beshear in the GOP-controlled Senate, although the majority party’s ranks there have only grown during his eight years in office. Sen. Robin Webb, D-Grayson, won a special election after Beshear named former Sen. Charlie Borders to the Public Service Commission in 2009, but Republicans held onto contested seats after the Democratic governor appointed former Sen. Dan Kelly and Senate President David Williams to circuit judgeships in 2009 and 2012, respectively.

Bevin said political gamesmanship would play no role in his appointments, saying he’s looking for individuals of character, competence and commitment.

“I’m not looking to play political games,” he said. “… If they meet (the three criteria) and they’re Democrats, outstanding. If they don’t meet them and they’re Republican, sorry. I mean, the reality is I’m looking to govern this state in a way that’s going to help every Kentuckian regardless of their party.”


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