Plan to split county employee pension plan from Kentucky Retirement System put on hold
Gov. Matt Bevin and Public Pension Oversight Board Chair Sen. Joe Bowen announced Thursday that a bill to separate the County Employee Retirement System (CERS) from the woefully underfunded Kentucky Retirement System (KRS) will not move forward in the 2017 session but could be achieved in a special session addressing all pension issues.
The bill, sponsored by Sen. Bowen and advocated by county and city groups in the state, came about as CERS has the highest funding levels of all 5 plans in KRS and holds much of the assets, causing the county employees to seek separation from the system.
While well intentioned, Bevin said he feels the issue needs more research before taking such a huge step and would like to see the audits of all state retirement systems completed before addressing any pension issues.
Bevin said because of Bowen’s passion, the concept of separation of the county employee retirement plan from KRS will be “leading part of conversation” on pension reform later in the year.
The governor did, however, express concerns of high contribution payments that could be required of counties as reforms move forward and said those worries are why the issue needs to be part of a bigger conversation on reforms.
“The last thing we want to do is make this problem worse,” Bevin said.
Senator Bowen said he still believes in the legislation, which is why he sponsored it, but does believe waiting to have the conversation was the right move so that the bill didn’t get lost this session and could receive the serious consideration it deserves.
The county and city groups working on this bill are disappointed by the news that the bill is stalled this year, according to Bowen. But he said they remain committed to the issue.
“By slowing it down, we are speeding it up,” Bowen said, referring to the traction he believes the issue will get because of the attention that is being placed on it.