U of L's Ramsey says state pension system should go to 401(k)-style to save money
06/23/2011 07:45 AM
Revamping the state worker retirement system to require future employees to pay into 401(k)-type accounts should be lawmakers’ top priority in 2012, University of Louisville President Jim Ramsey said.
Ramsey, a state budget director for former Gov. Paul Patton, said the legislature should take the step of picking a “drop-dead” date to cut off the current pension system and any new hires beyond that date would be under the defined contribution, or 401(k)-style system.
“I know that’s not popular,” Ramsey said after the 9 minute mark in the video. “But that’s what we’re in. The University of Louisville and University of Kentucky are a little different than our other brother and sister institutions, either K-12 or higher education.”
In addition to the pension system, Kentucky’s budget health is threatened by the continued growth of the state Medicaid system that covers health care for poor and disabled Kentuckians, as well as the cost of the corrections system.
Ramsey talked about those issues, as well as the state’s revenue growth (at the 10 minute mark).
As for the university’s finances, Ramsey said even though tuition continues to go up — another 6% next year — most students don’t pay the sticker price thanks to scholarships and financial assistance.
But he said the universities do need more “support” from state lawmakers in the budget both to hold down tuition and grow strategically with research and classrooms. Specifically, he said he wants the legislature to set aside money again for the Bucks for Brains program that uses state dollars to match private donations for research.
“We need more Bucks for Brains,” Ramsey said. “We actually need more classroom space … So yes, we need more support from the state.”
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