Date: 07-16-2017
Can public pension benefits be cut? Kentucky officials looking into it
FRANKFORT, Ky. — Advocates for public employees and teachers in Kentucky are uneasy as Gov. Matt Bevin prepares to call a special legislative session to stabilize Kentucky’s public pension crisis.
For decades the workers — some of whom cannot receive Social Security — have been protected by state laws that recognize their pension benefits as an “inviolable contract” guaranteeing them the benefits they earn under the plan they signed up for when hired.
But Kentucky’s pension crisis has grown — the state now has at least $40 billion in unfunded pension liabilities — and, officials and workers advocates say, likely will require some sort of unprecedented and unpopular action.
Chris McDaniel, the Taylor Mill Republican who chairs the Senate budget committee, said he’s not trying to scare people, but the state is at a point “where we cannot make pension payments and deliver essential services. … It’s impossible.”
A think tank is recommending that lawmakers consider reducing the future benefits of current government workers — a move that advocates for those workers consider a full-out assault on their contractually guaranteed benefits.
In a recent letter to the editor published in the Courier-Journal and other newspapers, Jim Carroll, president of the advocacy group Kentucky Government Retirees, said: “We will not accept cuts to benefits promised under an inviolable contract enunciated in state law. If a bill is considered that reduces promised benefits, we will storm the Capitol with torches and pitchforks. If it is signed into law, we will litigate.”
For teachers, the main concern is different. Certain aspects of the benefits they get — and consider important — are specifically exempted in law from protections and are now vulnerable as legislators look to address the pension crisis. Teachers are not eligible for Social Security benefits, as other state workers are.
For his part, Bevin said in a June 6 letter to legislators, “We have a moral and legal obligation to fulfill our pension promises to current employees and retirees.”
But the governor has not released his specific proposals yet for pension reforms or tax reforms, nor has he said when the special session will be. The Governor’s Office did not respond to an email and phone call seeking comment for this story.
McDaniel says it is too early to predict how lawmakers will address benefits, other than to say that a new approach will be taken to achieve savings on benefits for employees hired in the future who have no protection of the inviolable contract. CLICK TO READ MORE HERE
By Tom Loftus
The Courier-Journal
