BELTON, Ky. (8/28/17) — I am very aware that many in the 15th District are concerned about the condition of the state pension systems. Some have contacted me about a House meeting that is going to take place on Tuesday, Aug. 29, which is closed to the public. I am going to be as open and honest as I can be and hope that you understand the reality and seriousness of the entire situation from many aspects.
On Monday, Aug. 28, the independent consulting group PFM commissioned by the state to examine our pension problems, will release their third and final report to the Pension Oversight Board along with their recommendations as to how to fix those problems. There is no doubt the recommendations will not be pretty, however, it is imperative that everyone understand that at this point in time, these are only recommendations. Any legislative action will not mirror the full recommendations. The first thing that has to happen is Gov. Bevin and his staff have to take those recommendations and propose a plan to the General Assembly. Then, the General Assembly has to wrestle with those recommendations before taking a vote which will NOT happen on Tuesday. Monday and Tuesday are only the BEGINNING of the process that will take, what I anticipate, a couple of months if not longer.
What is happening on Tuesday is simply a PRESENTATION by PFM to the entire House, both Democrats and Republicans, so as to inform us of what their recommendations are, so when we get the governor’s proposal, we will have some idea of what is being recommended. The reason the House meeting is happening behind closed doors is so that legislators on both sides of the aisle will not have the opportunity to “grandstand” in front of the cameras, and trust me, this happens. It is my understanding that PFM will present and we will have the opportunity to ask questions and that is all that is taking place on Tuesday. Legislators will not be engaged again in the legislative process regarding pensions until we get the governor’s proposal.
The public pension problem has been evolving for many years. Past leadership failed to act; they added to the problem without adding more funds, denied there was a problem and kicked the can down the road until the unfunded liability has grown to astronomical proportions. Prior to the passage of SB3 this past legislative session, an ACT relating to the disclosure of public retirement information and declaring an emergency that provided transparency that had been fought for years, the unfunded liability was thought to be around $34 billion. After the veil was lifted, it is estimated to be between $64 and $84 billion across all eight plans. When formulating a final plan, we have been informed, the intention is not to pass a measure that would include an emergency clause; current employees within every Kentucky Retirement System would have ample time to make a retirement decision once a plan is passed by the legislature.
I have seen a Facebook post that says “Tell Your Legislator: Keep your hands off my pension.” What it should say is “Please save my pension.” To make a medical analogy — just because you deny you have cancer doesn’t mean that you don’t have it. We have to deal with reality even though the treatment may not be pleasant.
Gov. Bevin is committed to finding real, long-term solutions as evidenced by putting an historic amount of funding into the pension systems in his first budget. However, in doing so, he was highly criticized because in order to put such a big amount towards the pension systems, unfortunately, there had to be a less than 1 percent cut to higher education in order to begin to get to a solution of the public pension system without raising taxes. When you have a finite pot of money that has to be spread out over many bowls, if more has to be put in one bowl for a period of time in order to cover past expenses not paid, other bowls may not get as much until those unfunded expenses are made up. That doesn’t mean the cuts will last forever, but they may have to continue for a period of time until what was ignored for years gets caught up.
“We are morally and legally obligated to deliver, to the best of our ability, the pension promise made to Kentucky’s state employees. I am determined that we can deliver on this promise,” sai Gov. Matt Bevin.
As I have said to many, I did not create the problem, I didn’t contribute to the problem nor did I try to hide it. However, I am committed to working with both sides of the aisle in an attempt to make practical decisions in order to try to solve the problem. Tough decisions will have to be made to save the pensions so that they will continue to exist at all in the future.
I personally would ask for your prayers as we as legislators discern what the solution needs to look like in fairness to all Kentuckians, regardless of political fallout. There is a tough road ahead, however, current House leadership is committed to fixing the issue. Please remain objective as those formally in control of House leadership for almost 100 years begin to use this as a political issue that their party is primarily responsible for creating. Current House leadership has only been operating for eight months. It may take a while to right the ship.
While the meeting on Tuesday is not open to the public, the meeting on Monday (Aug. 28) is. It will take place in the Capitol Annex at 12 p.m. CDT/1 p.m. EDT in room 149. There are several overflow rooms being designated for those that want to be present for that meeting.
Gov. Bevin has invited folks to join him on his official Facebook or YouTube pages Monday evening at 7 p.m. CDT/8 p.m. EDT for a live question-and-answer session regarding the current pension shortfall. He has several videos and lots of information on the website. If you are reading this after Monday evening, I am sure there will be recordings you can watch after the fact. https://pensions.ky.gov/Pages/index.aspx
Within that website you can dive further into the three main state pension systems; each includes more than one pension system. It is a very complicated issue and it needs serious thought and consideration.
I will be more than happy to discuss with groups along the way and intend to keep the constituents of the 15th District informed moving forward. Please follow along via my legislative log that is published in most local papers as well as on SurfKY News or on my official Facebook page @melindagibbonsprunty
You can also keep track of committee meetings and potential legislation through the Kentucky Legislature Home Page at www.lrc.ky.gov
Note: Representative Melinda Gibbons Prunty represents the 15th House District serving Muhlenberg and SE Hopkins Counties which includes White Plains, Morton’s Gap, Anton as well as sections of Nortonville, Earlington and SE Madisonville. She is Vice-Chair of the Health & Family Services Committee and serves as a member of the Education, IT & Small Business, Medicaid Advisory & Oversight Committees as well as the Budget Review Subcommittee on Education. She has also been appointed to and serves on the House Adoption Work Group.
© Copyright 2008 – 2017 SurfKY News Group, Inc. All rights reserved.
This material may not be published, broadcast, or rewritten without permission.
Click here to subscribe to receive daily updates by email.