At a meeting of the Public Pension Oversight Board, legislators expressed the need for legislative review of contracts for the top officials of the pension systems in the state and said legislation would be filed to set up a Senate confirmation panel for board appointments.
At the meeting of the pension group Monday, legislators suggested the need for more transparency and oversight when it comes to the appointment of retirement system officials and their contracts. The calls come in light of news that KRS Executive Director Bill Thielen has agreed to postpone his retirement with a new contract approved by the KRS board Friday which keeps Thielen at the helm for an additional 30 months and includes a salary increase.
The legislators expressing concerns over the new contract suggested that legislation will be introduced to provide more oversight. Sen. Joe Bowen called for legislation to allow review of all contracts with KRS and KTRS by Government Contract Review Committee. Sen. Jimmy Higdon said he would look to file legislation to make non-elected KRS board appointments subject to Senate confirmation and agreed with Bowen’s proposal on contract oversight.
After the meeting, House Republican Leader Jeff Hoover added to the calls for transparency with a statement about the need for legislative oversight.
“I have long advocated for increased transparency for our public pension systems, including a comprehensive audit,” Hoover said. “As a member of the General Assembly, I concur with those who are calling for greater oversight by legislators, including ending the procurement code exemption for KRS and KTRS and allow their contracts to be reviewed by the Government Contract Review Committee.”
On the call for an audit, Thielen also announced to the committee that the KRS board approved a resolution Friday requesting a comprehensive performance audit of the system—a call first made by the Kentucky Chamber. Thielen said the money to conduct such an audit should be appropriated by the General Assembly in the next legislative session.
However, Kentucky Chamber President and CEO Dave Adkisson called Monday for the oversight board to recommend that the funds be allocated ahead of the 2016 session, adding that there is no need to wait a whole year to get this done.
Also at the meeting, Thielen explained to legislators that the retirement system’s investment returns have been down 4.8% in the last three months, something he said would be worse for the system than the recession if those numbers were to continue. However, Thielen said the returns have seen some slight improvements in October.
As for an update on other issues facing the systems, both KRS and KTRS officials expressed concerns over the fact that the Kentucky Career and Technical College System has stopped enrolling its new employees in the pension plan and officials from both systems said they would continue to monitor the impact of the change.
For more on the remarks from Kentucky Chamber President Dave Adkisson from the Monday meeting, click here.