Despite Delays, Lawmakers Say Pension Bill Will Emerge Soon
Lawmakers are still working on revisions to a massive bill that would overhaul the state’s pension systems, but push-back from public employees and a statehouse sexual harassment scandal have slowed down the process.
In October, Gov. Matt Bevin and Republican leaders of the legislature unveiled a plan that would phase out the state’s use of a pension system that guarantees benefits for life and tinker with benefits of current employees.
The proposal was met with widespread backlash from state employees. In turn, Bevin and Republican lawmakers promised to revise the bill so it could be considered during a special legislative session late last year, but a consensus on new changes couldn’t be reached.
Lawmakers now say a revised set of pension changes will be released later this month.
Senate President Robert Stivers, a Republican from Manchester, said a sexual harassment scandal in the House and ensuing leadership shakeup are partly to blame for delaying the revisions.
“I don’t think it’s derailing, but I think it’s somewhat slowing the process, there’s no doubt about that,” Stivers said.
House Speaker Jeff Hoover has temporarily relinquished the speakership to Speaker Pro Tem David Osborne while the Legislative Ethics Commission investigates whether Hoover sexually harassed a staffer.
On Wednesday, eight lawmakers including Louisville Republican Rep. Phil Moffett filed a complaint against Hoover over the allegations.
Osborne said lawmakers are still focused on pensions despite the harassment scandal and said he hoped the bill would be released in the first two weeks of the session.
“People will have time to read the bill, as will all of our members,” Osborne said. “We’ve said all along that our members will have adequate time to understand the bill and communicate with their constituents.”
Osborne said lawmakers were still waiting for the bill to be scored by officials in the state’s pension systems.
The proposal released this fall would have moved most future and some current state workers onto less-generous 401(k)-style retirement plans. Current employees would be required to contribute 3 percent of their paychecks to the retiree health system and retired teachers would have cost of living adjustments suspended for 5 years.
Stivers said the 401(k) provision would likely be included in the new bill but that it might be scaled back for current employees.
Under the bill released in the fall, employees hired since Jan. 1, 2014 would be moved into 401(k)s and current employees would have their benefits capped after 27 years of service and then moved into 401(k)s going forward.
Lawmakers also have to pass a new two-year budget, which Bevin has promised will include steep cuts to state spending.
Stivers said it’s unlikely that lawmakers will make comprehensive changes to the tax code this session.
“There may be some type of tax reform, but if it was going to be comprehensive I don’t think it could be done in this period of time,” Stivers said.
Bevin will present his proposed budget during an address on Jan 16.