It has become increasingly clear that many of the proposals now being considered in the Capitol are solutions looking for problems that do not exist.
The ongoing attempt by Governor Bevin and other legislative leaders to reform our two main public retirement systems is the best-known example. These leaders’ desire for change, however, ignores a stubborn fact: The bipartisan reforms of 2008 and 2013 are working.
These systems posted investment gains of 13 and 15 percent last year, or about double what they historically strive for annually. As long as we keep funding the systems, as the state did in the 2014 and 2016 budget cycles, we will bring their long-term liability under control.
It looks like the other legislative leaders are starting to see the wisdom of that approach. Last week, for example, Senate President Stivers said that switching to a 401(k)-style system would cost government more than continuing on the path we are now on.
The difference is not a small number, either. For teachers alone, the governor’s original plan from last fall would have cost taxpayers $4.4 billion more over a 20-year period while providing fewer benefits to the employees and retirees.
A revised pension bill was expected to be filed this week, so we will know more once it and an accompanying actuarial study are released. For now, I will say I am troubled that this bill is being written in secret.
This process is contrary to the close working relationship legislators and stakeholders had when enacting the earlier reforms, and with only about two dozen meeting days left in the legislative session, there is relatively little time to give this proposal the type of hearing it deserves.
As we wait to see what their bill would do, there are three others being pushed forward in the House this year that I think would be more harmful than helpful.
One approved by the House last week would make it more difficult for us to go after those pharmaceutical companies that have flooded the commonwealth with painkillers.
Currently, the Attorney General’s office partners with private law firms on cases that require a considerable amount of manpower and expertise. These contracts cost the state nothing, because the law firms are only paid if a settlement is reached.
Last week’s legislation, however, will make this legal arrangement less appealing to the law firms, meaning they will be less likely to join us in cases where the state believes our citizens have been harmed. That’s the last thing we need to be doing, especially with tens of millions of dollars at stake.
The two other bills, meanwhile, would significantly alter our workers comp and unemployment insurance programs, both of which are in strong shape.
The first of those bills passed a House committee last week and would put a 15-year limit on medical benefits for those with a workplace related injury that leaves them partially disabled. These workers, such as our firefighters, police officers and coal miners, were hurt while doing their job, and should not have to cover the medical costs to treat this pain. Workers comp premiums have also been declining for the last dozen years, underscoring the fact that there is no crisis to address.
The legislation regarding unemployment insurance, meanwhile, would significantly cut weekly payments and make it tougher for displaced workers to qualify in the first place.
This work undermines 2010 and 2012 reforms that brought business and labor leaders together to come up with a solution to pay back the nearly $1 billion federal loan we had to borrow to pay unemployment benefits during the Great Recession.
That plan worked even better than hoped, because it paid the loan back years ahead of schedule. Now, that fund has more than $400 million in reserve, which is a healthy amount that will make it easier to weather another recession. At a time when things are working well, and with the state unemployment rate below five percent, it makes no sense to go after those seeking to find another job and are already having a tough time keeping food on their table.
While there is a considerable difference of opinion regarding these bills, there was some harmony in the Capitol last week when government leaders from all three branches gathered in the Rotunda to celebrate Black History Month. My fellow House members and I have also been learning more about the month during each day’s session. For example, the founding father of Black History Month was a Berea graduate and nearby Lynch plays a prominent role as well in our corner of the state.
Legislators are only meeting for four days this week because of the Presidents Day holiday, but with March just around the corner, the legislative pace promises to speed up.
With our time in the Capitol winding down, it is more important than ever that you let me know your views on the issues before the General Assembly. My address is Room 429I, Capitol Annex, 702 Capitol Avenue, Frankfort, KY 40601, or you can send me an email at Angie.Hatton@lrc.ky.gov.
Our toll-free message line is 800-372-7181, and if you have a hearing impairment, it is 800- 896-0305.