Whitesburg KY
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Beshear orders special session




FRANKFORT

Gov. Steve Beshear has called the General Assembly into a special legislative session to deal with pension reform for public employees.

Beshear signed an order Tuesday calling lawmakers back to Frankfort on June 23. The governor previously said he would call lawmakers back to the Capitol if leaders agreed on a plan to shore up the state’s financially unstable pension system.

“We’ve worked this out, hopefully, before we ever start. So we’re at a point to where we can hit the ground running,” Beshear said during a press conference at his office in the state Capitol. “I’m hoping in a fiveday period that it will go ahead and clear the House and the Senate and I can sign the bill.”

Kentucky’s state retirement system, which covers retirement benefits for more than 445,000 people, is facing an unfunded liability of more than $26 billion. Legislative leaders have said that without changes, the system faces an eventual financial collapse.

In his Tuesday order, Beshear said there was an “immediate need to protect the retirement of current employees and modernize the pension system to ensure a financially sound and sustainable retirement program for future employees.”

Among the proposed changes, which would affect only new hires: State employees would have to wait until the sum of their age and years of employment totals 87 to retire with full benefits. But employees who are 65 or older could retire with full benefits and five years of service. The plan would also require new employees to contribute 1 percent of their salaries to health insurance.

Beshear said doing nothing puts the retirement benefits of teachers, firefighters, police officers, emergency workers and other government employees at risk.

“These people have worked hard and earned the right to be financially secure when they retire,” he said. “The reforms that the House and Senate leadership and I have agreed to will go a long way toward placing the pension systems on a sound financial footing.”

Beshear said the proposed changes, combined with an increase in the retirement system’s financial investment returns, could save nearly $500 million a year. Other lawmakers have disputed the figure, saying it would be far less.


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