On Tuesday, the Senate State and Local Government voted 8-3 to pass House Bill 1, the pension relief bill for regional universities and other quasi-governmental agencies including health departments, rape crisis centers, and more.
House Bill 1, sponsored by Rep. James Allen Tipton, allows those organizations an opportunity to exit the retirement system and pay off their liabilities in a lump sum, or over a 30-year period if they choose to exit, as well as freezes the employer contribution rate for those groups at 49 percent. Learn more about the bill here.
Murray State University President Bob Jackson testified in favor of the bill stating the retirement system and the pension costs to the university, in the current state, are unsustainable and unmanageable for the university. He noted 10 years ago, the universities and other agencies were paying a 10 percent employer contribution rate, which has now reached 84 percent if the bill does not go into effect.
Jackson, who was a Democratic state Senator from 1997 to 2004, told lawmakers families and students count on the university and with the pressures of rising pension costs and decreasing state appropriations, is the financial responsibilities are becoming impossible.
House Bill 1 now moves forward to receive a vote by the full Senate on Wednesday, expected to be the final day of the special session.