Thomas K. Elliott, ousted chairman of the Kentucky Retirement Systems Board of Trustees, state Attorney General Andy Beshear and another KRS trustee are suing Kentucky Gov. Matt Bevin over the restructuring of the retirement system board.
On June 17, Mr. Elliott and trustee Mary Helen Peter filed a lawsuit challenging Mr. Bevin's authority to remove Mr. Elliott from the board. They amended that lawsuit this week in light of Mr. Bevin's larger overhaul of the KRS board.
At a news conference Wednesday, Mr. Beshear announced he will be joining the trustees' lawsuit and adding a section challenging the governor's recent restructure of the University of Louisville Board of Trustees.
Mr. Bevin on June 17 announced the creation of the Kentucky Retirement Systems Board of Directors, replacing the KRS board of trustees. Mr. Elliott, whom Mr. Bevin ordered removed from the board in April, citing a need for a fresh start and more transparency, was not listed as a member of the new board of directors, but Mark Lattis, whom Mr. Bevin appointed as his replacement in May, was. The other 12 current trustees were retained under the new structure, and four new members appointed by Mr. Bevin were added.
Mr. Elliott and Ms. Peter's lawsuit argues that Mr. Elliott remains a member and chairman of the board and that Mr. Bevin's attempts to remove and replace him are “null, void, unconstitutional and of no effect.”
The lawsuit also seeks to enjoin attempts to interfere with Mr. Elliott's service as a trustee and chairman and abolish the KRS board until the court has ruled on the legality of the restructure.
In the restructuring, Mr. Bevin also appointed existing trustees John R. Farris and David L. Eager as board chairman and vice chairman, respectively; said any executive director appointed by the board must also be approved by governor; and mandated that all investment holdings, fees and commissions, contracts or offering documents, be available online, echoing language in a pension transparency bill that passed the state Senate in February but died in the state House.
William A. Thielen, current executive director of the roughly $16 billion Frankfort-based retirement system, announced last month he will retire Sept. 1.
Mr. Thielen previously told Pensions & Investments that Mr. Elliott attended last month's board meeting but did participate under the threat of arrest from members of the governor's office and state troopers.
Mr. Elliott was first appointed to the board in 2011 and reappointed last year by then-Gov. Steve Beshear for a term that expires March 31, 2019. Steve Beshear is Andy Beshear's father.
Andy Beshear said Wednesday that Mr. Bevin's reorganizations are “not about efficiency,” but are about “control and power” and “eviscerate” the checks and the balances in place.
On Monday, Mr. Beshear said in a written opinion that conditions at last month's meeting violated the state's Open Meetings Act. In May, Mr. Beshear's office issued an opinion against Mr. Elliott's removal.
Mr. Elliott and a spokeswoman for Mr. Bevin could not immediately be reached for comment.