Rep. Rick Rand working on bill to create pension oversight board
11/22/2010 06:17 AM
State Rep. Rick Rand, D-Bedford, said he is working on legislation that would create an independent board to scrutinize the state pension system, including its investments.
Rand, the state House budget chairman, said on Pure Politics Friday that the board would serve as “a bridge” from the pension system to the administration and the legislature. In addition, he said the board could recommend ways to change benefits for future state employees to make the system more stable and less of a financial liability for the state over the long haul.
“That board would oversee the pension system to make sure their investments were according to industry standards. It would even look at benefits and could advise us on benefits … for new employees,” Rand said.
The Kentucky Retirement System is overseen by a board of directors most of whom are beneficiaries of the pension system.
A study presented to the budget committee this summer revealed that the pension system revealed that the Kentucky Retirement System’s investments aren’t likely to keep up with expected payouts over the next 30 years.
And an audit of the pension system this year revealed questions about the use of middlemen managing some of the investments, as first reported by John Cheves of the Herald-Leader.
Rand also weighed in on the ongoing controversy over the Passport Health Plan, the managed care set-up in Louisville and 15 surrounding counties. The program provides coverage to poor and disabled Kentuckians. It is the largest private contractor with the state with its nearly $800 million annual contract.
A state audit found the program spent “excessively” on travel, lobbying and entertainment and questioned extra payouts to the founding entities, including the University of Louisville Hospital.
“I don’t think it’s soured us. Obviously what’s happened is disappointing and upsetting to all of us,” he said.
The question lawmakers most want answered is whether Passport can deliver services cheaper than the Medicaid program, Rand said.
- Ryan Alessi
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