Twenty-three empaneled to explore funding woes at KTRS
06/16/2015 04:54 PM
A 23-member group has been empaneled via executive order to examine funding issues at the Kentucky Teachers’ Retirement System, Gov. Steve Beshear announced in a news release Tuesday.
The panel, created via executive order and called the Kentucky Teachers’ Retirement System Funding Work Group, is expected to present its recommendations by Dec. 1 and explore how other states grant pension benefits, various funding options and draft a plan to improve KTRS’s financial standing, according to the release.
“Our teachers are the foundation of our educational system for the future of our children and grandchildren,” the Democratic governor said in a statement. “We must assure that the Kentucky Teachers’ Retirement System is able to fully honor our commitments to our teachers and those who retired from teaching. Today I’m asking a group of experts to find ways to ensure the future of the KTRS.”
- Former state senator and former chairman of the Kentucky Board of Education David Karem
- Kentucky Chamber of Commerce CEO David Adkisson
- Kentucky School Boards Association Executive Director Mike Armstrong
- Jason Bailey, research and policy director for the Mountain Association for Community Economic Development
- Kentucky Education Association Executive Director Mary Ann Blankenship
- State Budget Director Jane Driskell
- State Auditor Adam Edelen in an ex-officio capacity
- Amanda Ellis, associate commissioner of the Office of Next Generation Learners in Kentucky Department of Education
- Finance and Administration Cabinet Secretary Lori Flanery
- KTRS Executive Director Gary Harbin
- State Treasurer Todd Hollenbach
- Executive Cabinet Secretary Mary Lassiter
- Personnel Cabinet Secretary Timothy Longmeyer
- Kentucky Board of Education Chairman Roger Marcum
- Jefferson County Teachers’ Association President Brent McKim
- Prichard Committee for Academic Excellence Executive Director Brigitte Blom Ramsey
- Kentucky Association of School Superintendents Executive Director Tom Shelton
- Kentucky Retired Teachers Association Executive Director Bob Wagoner
- Kentucky Association of School Administrators Executive Director Wayne Young
- Two members of the Kentucky Senate, appointed by Senate President Robert Stivers
- Two members of the Kentucky House of Representatives, appointed by House Speaker Greg Stumbo
KTRS officials have pushed for additional funding in recent sessions, heavily backing a bill that would have authorized the sale of $3.3 billion in bonds to shore up the system.
The order also notes accounting standards will change for KTRS, and without a funding plan in place, the agency’s funded ration is expected to decline to 45.6 percent while its unfunded liabilities will rise to $21.6 billion once the new Governmental Accounting Standards Board take effect next month, Harbin told Pure Politics in late March.
Stumbo, D-Prestonsburg, noted his sponsorship of House Bill 4, which would have authorized the bonding plan for KTRS.
“There is no doubt that additional and significant money is needed to address the long-term stability of the Kentucky Teachers’ Retirement System,” he said in a statement. “I sponsored House Bill 4, which was passed by the House and died in the Senate, believing we had a unique opportunity to provide additional funds in this year’s session. My hope is that this work group will inform and help the legislature find the best solution for the needed funding.”
Said Stivers, R-Manchester: “I appreciate the Governor’s willingness to take action on a very serious issue that is definitely a priority for all legislators. This will not be a quick fix, but rest assured that the Senate Republicans are committed to finding long-term solutions to make this system viable in perpetuity for teachers and all Kentuckians.”
Not all lawmakers were thrilled at Beshear’s announcement, however.
House Minority Floor Leader Jeff Hoover, who has unsuccessfully pushed for such a study of KTRS in recent sessions, said he was “extremely disappointed” in Beshear’s decision to empanel the group.
The Jamestown Republican reiterated that he would rather have an independent group examine the long-term stability of KTRS.
“Governor Beshear had a real opportunity to create an independent, non-partisan panel to give a thorough review of KTRS in an effort to make substantive recommendations to solidify the system,” Hoover said in a statement.
“Instead the Governor chose to fill this task force with self-serving special interest groups that have been part of the problem, not part of the solution. During the last session House Democrats proposed $3.3 billion in pension obligation bonds for KTRS, which would have handed taxpayers the bill and crushed Kentucky’s economy for decades to come. Meanwhile an outside group recently advised investors to exercise caution in purchasing bonds in Kentucky because of our tremendous pension debt and sluggish economy in the Commonwealth.”
But Beshear said threats of rating adjustments by national credit-rating agencies necessitate an immediate resolution.
“If Kentucky is to compete for 21st-century jobs, we must have a world-class education system for our children,” he said in a statement.
“The success of such a system is dependent upon the recruitment and retention of outstanding educational professionals. If we do not have a stable, secure retirement system for our teachers, Kentucky will never be able to compete in education at the highest levels.”
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