pensions

Aaron Payne

Major unions and one of their leading allies in the U.S. Senate are hailing tens of billions of dollars allocated for shoring up struggling union pension funds

The funding added to President Joe Biden’s $1.9 trillion COVID relief bill, dubbed the Butch-Lewis Act, would provide $86 billion to dozens of failing union pension plans across the country, including the Teamsters, carpenters, builders, and more. Ohio Democratic Senator Sherrod Brown said Tuesday the funding will save tens of thousands of Ohioans their pensions “earned over a lifetime.” He said he called some of those with pensions last weekend.

“The relief in their voices, the excitement, the tears. They had thought their retirement, what they had planned on might have been destroyed,” Brown said.

Creative Commons

A bill reforming the teacher pension system for new hires cleared the Kentucky State House Thursday afternoon, less than two hours after coming out of a legislative committee.

The bill would put teachers hired after Jan. 2022 into a different “tier” than current employees. The new tier would have a smaller defined benefit than the existing plan, but would also have an additional defined contribution, meaning a portion of retirees’ total benefits could fluctuate based on the treasury rate, but would not go down in value. 

The bill’s sponsor, Rep. Ed Massey (R-Boone), said the average payment would be 74% of the teacher’s salary, similar to salary replacement for the current plan and would save the state $3.57 billion over the next 30 years.

J. Tyler Franklin

Kentucky lawmakers will return to Frankfort on Tuesday for an unusual legislative session in the middle of the coronavirus pandemic.

Unlike most years when committee rooms and galleries can be packed with advocates, lobbyists and other interested parties, access to the Capitol will be limited, though many proceedings can still be accessed on KET’s website.

Legislators will be faced with weighty issues: they’ll need to pass a one-year budget amid uncertainties about how much money the state will bring in, respond to the coronavirus pandemic and Republican leaders say they want to strip Democratic Gov. Andy Beshear of his power to respond to the pandemic.

Beshear has said he wants to find new revenue sources for the state during the economic crisis—including initiatives like sports betting and medical marijuana, which have gotten limited support in previous years.

J. Tyler Franklin, WFPL

Kentucky’s regional universities are worried about a spike in the amount they have to put into the state’s pension system and, after more than a decade of cuts, are asking for the legislature to give them more funding.

Regional universities like Eastern Kentucky University, Murray State University and Western Kentucky University currently have to contribute an amount equal to 49 percent of every employees’ salary back to the retirement system.

That amount is about to increase to 93 percent. The universities say that would force them to cut services and raise tuition.


Becca Schimmel

Union coal miners and retirees breathed a collective sigh of relief after the U.S. Senate passed a spending bill that includes support for miners’ pensions, which had been at risk due to the coal industry’s downturn. 

The bill, which funds the federal government for the coming year, also includes The Bipartisan American Miners Act which secures pension and health benefits for retirees.

The United Mine Workers says that without Congressional action about 82,000 retirees and widows could have lost some or all of their retirement benefits in 2020. 


Senator Joe Manchin YouTube screenshot

West Virginia Democratic Sen. Joe Manchin pledged Wednesday to block all legislation until pensions and health benefits are secured for coal miners. 

Manchin said no legislation will pass the Senate until he is assured that coal miners’ benefits will be in the spending bill used to fund the federal government.

The Bipartisan American Miners Act would permanently secure pensions for about 82,000 coal miners who could lose their retirement benefits by sometime next year without congressional action.


Aaron Payne | Ohio Valley ReSource

The recent bankruptcy of Ohio Valley coal giant Murray Energy has renewed fears about the already shaky financial foundations of the pension plan that tens of thousands of miners and their families depend upon.

The seismic collapse of yet another coal employer has lawmakers from the region renewing their push to fix the United Mine Workers pension fund, and has even raised broader concerns about pensions for a range of other trades.

Murray Energy has a substantial footprint across the region. It is also the last major employer contributing to the UMWA pension plan. In its bankruptcy filing, the company reports $2.7 billion in debt and more than $8 billion in obligations under various pension and benefit plans. More information will likely come out as the bankruptcy court takes up the matter.


Lisa Autry

“Remember in November” became the rallying cry this year among many Kentucky teachers, highlighting their deep rift with Governor Matt Bevin over pension reform and education proposals. A number of those teachers have been stepping up their activism to help elect Bevin’s Democratic challenger, Andy Beshear, on Nov. 5

Chris McCoy is one of them. He's been on a mission to make Matt Bevin a one-term governor, knocking on doors since July for Gov. Bevin’s Democratic challenger, Andy Beshear.

“I’ve been in the education field for 15 years and I’ve never seen teachers get this excited over an election," McCoy told WKU Public Radio.


Kentucky Supreme Court Hears Arguments in Pension Case

Oct 24, 2019
Kentucky Office of the Courts

Government employees in Kentucky who sued over state investment decisions have taken their case to the state's Supreme Court after a lower court said they lacked standing to file suit.

The Supreme Court heard arguments in the case Thursday.

The fraud lawsuit was filed two years ago by a group of public workers. The Lexington Herald-Leader reports they claim out-of-state firms cheated Kentucky Retirement Systems on $1.5 billion in hedge-fund investments. The suit was dismissed by Kentucky's Court of Appeals.

Centerstone

The Kentucky Supreme Court has ruled that a nonprofit mental health provider can’t use bankruptcy to escape its financial obligations to the state pension system.

The Lexington Herald-Leader reports the unanimous ruling on Thursday could help protect the financial viability of one of the country’s worst-funded public pension systems.

Louisville mental health provider Centerstone owes an estimated $130 million to the Kentucky Retirement Systems, which manages the state’s pension fund.

ThinkStock

State Auditor Mike Harmon says Kentucky’s pension agencies aren’t properly disclosing how they invest their money and how much they pay investment managers.

Harmon says Kentucky Retirement Systems, Teacher Retirement Systems and Judicial Form Retirement System are out of compliance with Senate Bill 2, a 2017 law that requires great transparency in the state’s pension agencies.

“Our auditors found that when it comes to that basic requirement, KRS and TRS have fallen drastically short of what is required by the law,” Harmon said.


Thinkstock

Kentucky’s ailing pension funds might finally start getting healthier, according to estimates provided to lawmakers on Monday.

The pot of money used to send out retirement checks to most of Kentucky’s public workers — KERS non-hazardous — is currently among the worst-funded in the nation at 12.9 percent.

But Rich Robben, Executive Director of the Office of Investments for Kentucky Retirement Systems, says that after massive infusions of cash into the pension system by the legislature in recent years, that funding level might go up by 2 percentage points next year.


Liz Schlemmer

Gov. Matt Bevin’s administration says 1,074 Kentucky teachers broke the law by calling in sick to protest at the state legislature this year and that the educators are eligible to be fined $1,000 each for every day missed.

A release from Kentucky Labor Cabinet Secretary David Dickerson says that teachers won’t be fined this time, but that they might be in the future.

“Let it be clearly understood that the grace extended in this instance will not be extended for future such proven violations,” Dickerson said in a statement.

Flickr/Creative Commons

Kentucky’s health departments have another year to figure out if their workers will stay in the state retirement system or exit, following the passage of Gov. Matt Bevin’s pension bill on Wednesday. But the decision won’t be an easy one, and it may not even be feasible for many health departments to leave the system.

For years county health department workers got a pension — a guaranteed benefit retirement account. Employees hired since 2014 have already been moved into 401k-type plans. And now older workers are at risk of having their pension benefits frozen if the health departments they work for choose to exit the pension system under Bevin’s bill.

J. Tyler Franklin

This week in Kentucky politics, Gov. Matt Bevin signed the so-called pension “relief” bill into law after a short special legislative session. Attorney General Andy Beshear threatened to sue over the session, saying that Bevin had blocked lawmakers from considering other proposals. And Amy McGrath addressed the bumpy launch to her U.S. Senate campaign.

Listen to this week’s show:


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