Kentucky Gov. Steve Beshear said today he is backing a bill that would help shore up unfunded liabilities in the state’s pension systems. The bill, the Kentucky Public Pension Protection and Modernization Act, was scheduled to be introduced today by state Rep. Mike Cherry, according to the governor’s website. The $17 billion Kentucky Retirement Systems and the $15.5 billion Kentucky Teachers’ Retirement System, both in Frankfort, face combined unfunded liabilities estimated to be $26 billion, according to the governor.
The bill includes incentives for new employees that would lengthen the eligibility period for retirement, and require longer vesting for retirement and health benefits. The legislation also calls for an annual cost-of-living adjustment at 1.5% instead of the current practice of tying the adjustment to the rate of inflation.
The act also calls for the creation of an advisory commission, more investment training and education for the pension systems’ boards, and improved public transparency where meeting information and financial reporting would be posted in real time on a website.
