FRANKFORT, Ky. A bill in the Kentucky Legislature, aimed at alleviating $3.6 billion in unfunded pension liabilities of the $16 billion Kentucky Retirement Systems, Frankfort, and changing retirement benefits for future hires, is stalled in the state House, confirmed Jennifer Brislin, communications director for state House Speaker Jody Richard.
House members support issuing about $830 million in pension obligation bonds, but changing the benefits of future employees is in contention, Ms. Brislin said.
According to the bill, which was approved in the state Senate March 6, employees hired after July 1, 2008, would be able to contribute only 2.5% of pay to their defined benefit plan, compared with 5% before. These employees have the option of putting another 2.5% into a new defined contribution plan.
The legislative session is scheduled to end March 27, Ms. Brislin said, adding that House members are adamant about studying those changes in the interim and coming back to vote on the proposal in the next session, which is scheduled to begin Jan. 8. Gov. Ernie Fletcher has said he will convene a special session if an agreement is not reached now, confirmed his press secretary, Jodi Whitaker.
The state Senate and House have assigned a joint conference committee to study the bill in the interim before the next legislative day on March 26, Ms. Brislin said.
William Hanes, the systems executive director, said the new arrangement would apply only to new members of the Kentucky Employees Retirement System, the Kentucky County Employees Retirement System and the State Police Retirement System, all overseen by KRS. Current KRS members, as well employees in the $15 billion Kentucky Teachers Retirement System, the $195 million Judicial Retirement System and the $50 million Legislators Retirement System, would not be affected.