Mayor asks task force to work harder on reforming police and firefighter pension fund

bfortune@herald-leader.comJune 26, 2012 

Lexington Mayor Jim Gray (shown) on Wednesday, March 9, 2011 at news conference in the his office named Keith Jackson interim fire chief of the Division of Fire and Emergency Services. Jackson, 45, is a 20-year veteran of the division. Photo by David Perry oe Staff


Mayor Jim Gray directed his Task Force on Pension Reform on Tuesday to work harder to come to agreement on a plan to address the growing unfunded liability in the city's police and fire pension fund.

The mounting liability is an estimated $500 million, and it threatens the city's ability to provide basic services, Gray said.

"This unfunded liability is double the city's current annual general fund budget," he said. "We've put in $182 million over the past four years in cash and bonds. It hasn't made a dent."

The unfunded liability is the gap between how much money is in the fund and how much is needed to pay current and future retirees.

Gray appointed the pension task force in October, directing it to forge an agreement between police and fire unions and the city to balance the fund. The goal was to bring the parties together in a negotiated agreement that could be taken to Frankfort during this year's legislative session. There was no agreement.

In an effort to push pension discussions into high gear, on Tuesday Gray called on Police Chief Ronnie Bastin and Fire Chief Keith Jackson to start holding meetings within their divisions to gather ideas and recommendations, and report to the task force in 45 days.

Gray asked for changes that could easily be made to the pension rules, and he requested ideas for long-term solutions.

"For the past nine months we have been working together with union representatives through this task force, but things must change. That's why I've called for the chiefs to become involved and set a deadline," he said.

The mayor said more of his staff's time will be spent on resolving pension issues. A consultant will be hired to work with the unions and the city to come to an agreement.

"By far the best solution is an agreement by the task force," Gray said.

However, if that fails, the mayor will ask state legislators in their next session to give Lexington control of its pension fund. Although Lexington residents pay the bills, the legislature makes the rules for the city's pension fund — a system Gray said was fundamentally unfair.

"This is a tough problem, and it's going to take all of working together to solve it, from management to the rank and file," he said. "Problems like this don't get better by ignoring them or by avoiding them."

Beverly Fortune: (859) 231-3251. Twitter: @BFortune2010

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