KTRS 'system' blamed for pension shortfall
FRANKFORT, Ky. (WHAS11) -- On Oct. 25, Kentucky Senate President Robert Stivers said part of the shortfall for the state’s pension system is the fault of how the state's Teachers’ Retirement System is operated.
The Senate’s highest-ranking member said the actual proposal designed to save the pension systems could be released in the next couple of days.
President Stivers spoke, as he described it, to dispel misinformation about KTRS.
Those responsible for the fund insist that investments are looking up and additional state monies are moving the system towards stable footing.
“The biggest part of this problem is the systems themselves being over 80 percent responsible no matter who you want to listen to,” said the Republican Senate President.
President Stivers explained that funding KTRS (Kentucky Teachers' Retirement System) is different than funding for other pension plans in that statute requires Kentucky pay a percentage of payroll into the system. While the General Assembly has agreed to place additional monies in recent years to make up for some of the shortfall, President Stivers said that action is not a requirement.
Wednesday, he called into question the function of KTRS pointing to a 2013 memo stating that the system went from $6 billion short in 2008 to $13.8 billion in the hole by 2013. He and a spokesman for the retirement system acknowledged that timeframe also included the years known as "The Great Recession.”
The KTRS spokesman reported that shortfall number today is about $14.5 billion.
He credited an additional $973 million in state funding and improved investment returns for helping right the ship.
But President Stivers insists that more must be done to revamp the system itself.
"I truly value the teachers,” insisted President Stivers, “but the teachers need to be informed as to what their system is doing.”
We asked Democratic State Senator Morgan McGarvey whether KTRS needs to be investigated to see if it has been run property.
The 19th District Democrat responded, “I heard Senator Stivers raise those questions today. I like Senator Stivers, he's a serious guy, so when he we asks those questions we should try to get the facts and the answers and not look for something just to support our own partisan ideology.”
Last week Republican leaders said their plan will require paying off the estimated $40 to $60 billion unfunded liability over 30 years. The governor has yet to announce the timing of a special session to address the pension crisis.
President Stivers said the actual plan could be released to the public by the end of this week.