Gov. Bevin unveils plan to save Kentucky's pension systems

Governor Matt Bevin says his plan to save state pensions is "Keeping the Promise."

FRANKFORT (WHAS11) – The special session to vote on Governor Bevin’s reform plan is expected within the next month although Governor Bevin did not announce the dates for the five-day session to vote on the plan.

Flanked by Senate President Robert Stivers and House Speaker Jeff Hoover, Governor Bevin announced 10 points to the proposal still being worked on.

He said the plan will prevent "clawbacks" on pension and health benefits of those already retired, current employees will not see an increase in full retirement age.

Employees of hazardous positions such as first responders will see no changes at all and future teachers and employees will be placed into a 401K style plan.

Governor Bevin said the proposal means it will take 30 years for the plan to be fully solvent.

“Sure, everyone wishes we could get it taken care of in three or five or 10 years but the cost of doing that would be to gut everything in government and to violate, at least potentially, certain promises that were made. We're not going to do that. We're going to meet every promise that was made to everybody. We're going to remove all of that concern, we're not going to change anything for any retiree, we're not going to change people's retirement dates, we're going to allow anybody in the system to move, continue forward. We're going to honor the people who are hazard duty folks by recognizing that that is a different job than most of the rest of us have in government and we are going to protect everybody at every turn and that takes time,” Bevin said.

While they're working on full language of the plan, the governor's office released more detailed bullet points, see them listed below:

• “Keeping the Promise” will save Kentucky’s pension systems and meet the legal and moral obligations owed to current and retired teachers and public servants
• Requires full payment of ARC and creates new funding formula that mandates hundreds of millions more into every retirement plan, making them healthier and solvent sooner
• For those still working: no increase to the full retirement age, and current defined benefits remain in place until the employee reaches the promised level of unreduced pension benefit
• For those retired: no clawbacks or reductions to pension checks, and healthcare benefits are protected
• For future non-hazardous employees and teachers: enrollment in a defined contribution retirement plan that will provide comparable retirement benefits
• For current and future hazardous employees: will continue in the same system they are in now
• Closes loophole to ensure payment of death benefits for the families of hazardous employees
• Stops defined benefits plan for all legislators, moving them into the same defined contribution plan as other state employees under the jurisdiction of the KRS Board
• No emergency clause: law will not go into effect until July 1, 2018
• Structural changes should improve the Commonwealth’s rating with credit agencies, which have downgraded Kentucky’s rating, citing unfunded pension burdens

RELATED: Paying for pensions with pot?

The following document highlights individual plans for Bevin's "Keeping the Promise:"

Keeping the Promise_Pension Decisions for Multiple Plans  on Scribd

The following document is a general overview of the Keeping the Promise plan:

General Overview Keeping the Promise_10 on Scribd

The following statement is from Kentucky Democratic Party Chair Rep. Sannie Overly:

"Switching new teachers and new nonhazardous state employees to a 401(k)-style plan will not only weaken local economies throughout the state but will continue to decrease our ability to attract and retain a skilled state workforce.

This is purely a move touted by ultraconservative groups across the nation to privatize state services, remove a skilled state workforce and drive down wages for our future educators. The war on the working class and public education must stop. This plan will do nothing to pay down our current pension obligations and ensures less retirement security for future generations to come."

 

© 2017 WHAS-TV


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