After the release of a new pension reform proposal last week, the Kentucky Chamber issued a statement Tuesday about the plan and the need for action on structural reforms to the state’s retirement systems.
Senate Bill 1, sponsored by Public Pension Oversight Board Chair Joe Bowen and co-sponsored by Senate President Robert Stivers, seeks to fully fund the systems while moving new hires to a different style plan and other reforms they hope will save as much as $4.8 billion over the next 20 years.
The Chamber released the following statement on Tuesday:
The Kentucky Chamber supports the basic provisions in Senate Bill 1 to put Kentucky on a path toward solvency and protect taxpayers from uncontrollable costs. The business community is encouraged by structural reforms put forth in Senate Bill 1, many of which the Chamber has advocated for many years, including ensuring a disciplined approach to requiring responsible payments into the systems, recognizing the imbalance caused by public employees living longer on average than when the systems were created, and lessening the large financial burden of the systems’ liabilities being placed solely on taxpayers. Senate Bill 1 would create greater consistency across all of Kentucky’s retirement plans and keep promises made to state workers.
Inaction is not an option. It is clear the state’s retirement systems are in trouble. Structural changes are necessary in order to ensure the retirement security of current, future, and retired public employees. By honoring the commitments made and tackling this issue now, we can refocus attention on priorities that will move the state forward such as education, economic development, transportation funding and other pro-growth policies.
While many business leaders have called for even stronger reforms more akin to private sector practices, we commend the legislature for working to accommodate multiple interests and competing priorities for scarce state dollars. The Chamber looks forward to reviewing further information on Senate Bill 1. Now is the time to help the state’s woefully underfunded systems and put Kentucky on a sustainable path.