FRANKFORT — The Kentucky Senate unanimously approved a bill Thursday that would allow state lawmakers to decline a big increase in their retirement benefits if they switch to a higher-paying job in state government.
"This is a matter of doing the right thing," said the sponsor of Senate Bill 4, Sen. Chris McDaniel, R-Latonia.
McDaniel said an actuarial analysis showed that allowing lawmakers to opt-out of the lucrative benefit could save the state treasury about $6.1 million over 20 years.
Most part-time lawmakers make about $30,000 to $40,000 a year, but their retirement benefits dramatically increase if they take a higher-paying job elsewhere in state government, such as a cabinet position or judgeship.
In recent years, several lawmakers have taken advantage of a 2005 law, House Bill 299, that allows them to use the higher salary from another state government job when calculating their legislative pension.
McDaniel has said he couldn't make his bill mandatory for legislators because it would be challenged by people who already have taken advantage of HB 299. He anticipates that lawmakers' decisions to opt out of the HB 299 provision would be public record, but his bill doesn't mandate public disclosure.
Senate President Robert Stivers, R-Manchester, said Thursday's vote marked the sixth time the Republican-led Senate has tried to repeal provisions of HB 299, but those efforts have died in the Democratic-led House.
Stivers, who has been in the Senate since 1997, also said he would take the opt-out if SB 4 becomes law.
"Senate Bill 4 is one of our priorities this year — one that is critical in our efforts to 'right' our commonwealth's pension problems," Stivers said. "It's time we make this part of the total solution."