Kentucky Pension News

5% across-the-board raise proposed for city employees | News | state-journal.com

City employees may soon see a 5% across-the-board raise on the first paycheck in the new fiscal year, which starts July 1.

At the May 9 city commission work session, Blair Johanson, a managing consultant with Greensboro, North Carolina-based JER HR Group — previously called Johanson Group, presented a draft of the classification, compensation and benefits study his company has been working on in conjunction with Human Resources Director Kathy Fields and an internal team of city staff composed of Frankfort Fire Chief Wayne Briscoe, IT Director Bobby Ripy, Sewer Director Kenny Hogsten and Frankfort Parks, Recreation and Historic Sites Director Shawn Pickens.

• The legislative scorecard — a look at winners and losers from another Kentucky law-making session

Another Kentucky law-making session has ended and the state’s citizens are sifting through what was done that will affect their lives.

Some have emerged from the 2022 General Assembly with big victories. Some have seen their goals dashed and will have to regroup and try again next year.

Here’s a look at some major winners and losers of this year’s legislative session.

• Public safety tops agenda at Fiscal Court meeting

Several magistrates expressed their opinions that such a rate increase could put the county in jeopardy of being accused of “pension spiking.” Generally pension spiking is a process by which an employee or group of employees near retirement sees a larger than normal pay increase that “spikes” the amount of compensation they would see during retirement. In 2017, however, the Kentucky General Assembly set a $25 cap on the amount a government employee’s monthly pension payment could be increased without being considered pension spiking.

• Raises, pensions, full-day kindergarten, more: Breakdown of what made it in KY’s budget

Kentucky’s next two-year state budget includes big pay raises for state workers; full funding for public pensions, plus extra cash to help pay down the pension systems’ unfunded liabilities; and enough money to provide full-day kindergarten at local school districts, lawmakers said Wednesday as they approved it. House and Senate budget negotiators reached a deal on a $13 billion annual General Fund that would leave $1.75 billion in the state’s “rainy day” budget reserve trust fund. There also would be about $1 billion left unspent before proposed changes to the state’s tax code. A separate tax bill would take that sum down to about $11 million.

• Kentucky lawmakers wrap up work on next 2-year budget

Kentucky lawmakers wrapped up work Wednesday on the state’s next two-year budget, approving big pay raises for state employees and increased spending on education while setting aside large sums to offset expected personal income tax cuts.

The spending plan — the result of negotiations among leaders of the Republican-dominated legislature — won Senate and House passage with bipartisan support. The votes sent the state’s preeminent policy document to Democratic Gov. Andy Beshear.

RSS BIPPS Pension Posts

  • #KYGA22 Week 3: House passes budget bills, Senate approves literacy legislation and redistricting vetoes overridden January 22, 2022
    This week, the state House passed two budget bills. House Bill 1 funds the executive branch which is responsible for much of the commonwealth’s operations. House Bill 241 provides financing for Kentucky’s Transportation Cabinet (read our initial analysis here). Both budget bills now move on to the Senate for consideration.The enormous influx of COVID federal […]
  • Reform current pension benefits, ensure systems' future survival November 22, 2021
    Editor’s Note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after being published by newspapers statewide.Recent coverage of a slight increase in the Kentucky Employees Retirement System’s (KERS) funding level offers some needed perspective on the current environment. Consider that KERS was 140% funded in 2000 but fell […]
  • Pension-surplus funds not meant to be spent on higher benefits October 1, 2021
    Editor’s Note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after being published by newspapers statewide.Sometimes “no” isn’t just the right answer; it’s the only realistic one. Kentucky Government Retirees President Jim Carroll told the Public Pension Oversight Board (PPOB) he thinks giving state pensioners a 1.5% cost-of-living […]
  • Road fund bulletin highlights need for additional pension reform September 18, 2021
    Kentucky Auditor Mike Harmon released a data bulletin this week focused on expenditures and sources of revenue for the commonwealth’s road fund. The Bluegrass Institute has been actively opposing any increase in the state’s gas tax until an audit can be completed for the Kentucky Transportation Cabinet (KYTC) which would include a report on tax […]
  • Count your legal and pension blessings, and respond rightly September 3, 2021
    Editor’s Note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after being published by newspapers statewide. (This column was originally released on Aug. 26.)Welcome to the dog days of August. The Cincinnati Reds are hotter than usual and 90-degree temperatures have returned along with some semblance of legal […]

National Pension News

Kansas makes 3 commitments, lowers assumed rate by 75 basis points | Pensions & Investments

Kansas Public Employees Retirement System, Topeka, approved two new commitments totaling up to $50 million.

The $26 billion pension fund’s board at its May 20 meeting approved commitments of $25 million each to Apax XI, a middle-market buyout fund managed by Apax Partners, and mega-buyout fund Platinum Equity Capital Partners VI, spokeswoman Kristen Basso said in an email.

Ohio Teachers Pension Touts Past Transparency Awards, Fails To Disclose Special Investigation By State Auditor

The nearly $100 billion State Teachers Retirement System of Ohio never tires of telling its members of past transparency awards it has received from Ohio State Auditor Keith Faber. The fact that Faber’s office is currently conducting a special investigation into the pension’s transparency practices, prompted by public records lawsuits and numerous member complaints—the results of which could, says the auditor, affect the retirement system’s rating in the future—is not disclosed by the pension.

Stricter reporting standards may be on the way for alternative investments in Pennsylvania pensions | Pennsylvania | thecentersquare.com

Public pensions in Pennsylvania have a transparency problem. Adopting stricter reporting standards may give state legislators a better sense of the pension system’s full costs.

Pennsylvania’s public pensions have some of the lowest funding ratios in the country; the more fees the state pays out, the harder it is to ensure worker retirements are fully funded.

Ohio Teachers Pension May Be First To Investigate And Recover Funds From Private Equity Firms

Following last week’s election results, at least five members of the Board of the $100 billion State Teachers Retirement System of Ohio are not under the direct influence of any union or the pension’s Wall Street-friendly, overpaid investment staff. Soon the new Board will be free to vote to restore much-needed transparency, complete the independent forensic investigation of the pension’s secretive aka “private” investments commissioned by participants last year, recover monies related to any mismanagement or wrongdoing and restore promised Cost of Living benefits. If so, STRS Ohio will become the first public pension in the nation where stakeholders have reclaimed control from Wall Street.

Sen. Kesha Ram Hinsdale: With public pensions, a defined contribution is a broken promise – VTDigger

Educators and civil servants in Vermont made a promise to the communities they serve. They work for wages below those paid for comparable private-sector jobs and, in exchange, receive affordable health insurance, paid time off, and a stable pension on which to retire.

They have kept their promise, and we, as government and the public, need to keep our promise to them in return.

BIPPS on Pensions

The Bluegrass Institute for Public Policy Solutions, Kentucky’s first and only free-market think tank, is asking all candidates campaigning for General Assembly seats during this fall’s election to pledge support for bringing a greater level of transparency to Kentucky’s troubled public pension system.

The Institute recently sent – and asks all incumbents and challengers to sign – an 84-word pledge vowing to back “making the Kentucky Retirement Systems, Teachers’ Retirement System and Judicial Form Retirement System fully transparent, including requiring the disclosure of names, status and projected actual retirement benefits and benefit payments from the Kentucky Employees Retirement System, Teachers’ Retirement System, State Police Retirement System, County Employees Retirement System and Judicial Retirement Plan.”

For much of the past decade, the Bluegrass Institute for Public Policy Solutions has led from the forefront of pension reform in the commonwealth of Kentucky. “Future Shock,” the institute’s groundbreaking four-part series released in 2011 and 2012, warned that without meaningful reforms, the pension liability would engulf Kentucky’s entire economy. In a column published by the Bluegrass Institute on March 26, 2013, the late Lowell Reese, an esteemed journalist, publisher and former Chamber of Commerce executive, urged policymakers to take seriously the need to address the commonwealth’s deepening pension crisis. “The soaring cost of public employee pensions in Kentucky has become a major societal issue,” said Reese, who authored the “Future Shock” series. “The standard of living of all Kentuckians is at stake.”

The pension and healthcare funds for government employees in Kentucky — the state-administered pension systems — are in significant financial stress. The unfunded liabilities stand at $31 billion. Public employee pensions in Kentucky are badly draining the budgets of city and county governments, dipping into the budget of the commonwealth as never before, pushing up the state’s debt level while pulling down its credit rating. The pension obligations are on the brink of dramatically crowding out funds for essential government services such as public safety and education.

“Kentucky’s pension records are not subject to the open records law,” wrote Lowell Reese in Sunday’s Courier-Journal “They are shrouded in secrecy.

Reese, publisher of Kentucky Roll Call, also authored “Future Shock,” a series of Bluegrass Institute reports on Kentucky’s public-pension crisis.

The final of those reports offers 16 solutions for lawmakers to consider in fixing the pension system. No. 1 on the list: transparency.

Lowell Reese examines “gold-plated pensions” and Kentucky legislators’ history of awarding themselves more benefits at the expense of the state’s taxpayers.

“…the main message of this story resides in the subsurface — the attitude of the General Assembly…demonstrated by flat-out greed and disrespect for the public treasury, which now has put the standard of living of all Kentuckians in jeopardy.”