Kentucky Chamber president highlights need for balanced approach to pension reforms
With a special session to address the state’s woefully underfunded pension systems quickly approaching, a panel of groups from different perspectives discussed what could and should be done to address the persistent pension problems the state faces Monday night.
On KET’s Kentucky Tonight program, host Renee Shaw was joined by a panel including Kentucky Chamber President and CEO Dave Adkisson, Kentucky Education Association President Stephanie Winkler, Kentucky Center for Economic Policy Executive Director Jason Bailey, and William Smith, representative for the Bluegrass Institute for Public Policy Solutions to discuss pension reforms.
The Kentucky Education Association (KEA) would like to see more funding placed into the system to ensure that benefits that have been promised to teachers can be paid, Winkler said. Winkler also stated that changes to the system—even ones that could total $30 million—won’t save enough money to fix the system.
Similarly, Bailey maintained his position that his group does not believe the pension system problems are at crisis level and money is what is needed to fix the system rather than making structural changes for future hires. Bailey noted the legislative reforms made in 2013 and said no savings have been seen from those changes. However, when the legislation was implemented, PEW Charitable Trust, who advised the legislature, stated it would take years for the benefits to be seen as the hires were being placed into a new system.
Adkisson noted the differences of opinions among the panel with the KEA and Kentucky Center for Economic Policy representatives saying more money is needed to fix the systems and the Blue Grass Institute stating that the focus needs to be on the structural changes and how benefits are administered.
“Our position is in the middle of that. We feel like it is going to take more money, but there have to be some structural changes,” Adkisson said. “I think almost anybody that has been fairly objective knows that it’s going to take some of both. And trying to find that middle is what’s going to play out in Frankfort over the next six months.”
In terms of what structural changes could be on the table, the panel discussed the items widely considered to be outside of the inviolable contract including paid sick day spiking the final pension payments, retirement age before receiving full benefits, and other items.
The panel had differing opinions on what could work and what is even an option due to the legal nature of the inviable contract and the political will to make changes.
But in conclusion, Adkisson said this issue impacts the state and its citizens in too many ways for the problem to not be taken seriously and just say we need more money or only changes to benefits.
“We have a problem to fix. We need to do it in a balanced, rational way. The last figure I saw said there are 550,000 Kentuckians affected by this issue. Those who are retirees, those who are active teachers, those who are active police and fire, etc. So this is not a small deal to 550,000 people and their families,” Adkisson said.
The panel also discussed much more in the hour long program. Watch the full Kentucky Tonight segment on pension reforms on the KET website here.